The Internet Is Not the Answer (33 page)

The answer is shaping what GigaOm columnist Mathew Ingram calls the Internet’s “quasi-monopolies”
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before they shape us. The answer is Richard Sennett’s “bold politicians,” able to stand up to quasi-monopolists like Google. The answer is an accountable, strong government able to stand up to the “alien forces” of Silicon Valley big data companies.
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The answer is the aggressive antitrust investigation of Google conducted by EU competition commissioner Joaquín Almunia. The answer is a politician like Margaret Hodge, the chair of the British House of Commons public accounts committee, who, while investigating Google’s tax avoidance scheme in the United Kingdom, told a Google executive that his company’s tax behavior was “devious, calculated and, in my view, unethical.”
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The answer, as Marc Rotenberg, the executive director of the Electronic Privacy Information Center, argues, is “putting teeth” into privacy fines against “one of the biggest violations in history”—Google’s “Street View” mapping program, which secretly aggregated information from private homes and intercepted communications from personal Wi-Fi networks.
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The answer, as the Italian government has insisted, is to require Google to obey European law and ask permission before creating a profile of Internet users.
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It’s not just Google that needs to be confronted by the government. The answer also lies in a bold political response to other Internet giants, like Jeff Bezos’s Amazon. In July 2014, the
Nation
’s Steve Wasserman asked the right question: “When will the Justice Department take on Amazon?”
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We should thus celebrate the 2013 efforts of German antitrust watchdog the Bundeskartellamt to investigate Amazon’s unfair pricing practices against its third-party partners.
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We should welcome the July 2014 decision by the US Federal Trade Commission to sue Amazon for allegedly allowing children to make millions of dollars of unauthorized purchases in its app store.
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We should encourage the efforts of the International Association of Machinists and Aerospace Workers to petition the National Labor Relations Board to enable Amazon workers in US warehouses to form their first labor union.
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Above all, we should applaud the efforts of small publishers like Melville House’s Dennis Loy Johnson to challenge the increasingly monopolistic power of Amazon in the book business. “How is this not extortion?” Johnson asked about Amazon’s 2014 decision to delay shipments of books from Hachette and the German publisher Bonnier after they failed to agree to a business arrangement in which Amazon demanded broader discounts and extra marketing fees. “You know, the thing that is illegal when the Mafia does it.”
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As Brad Stone notes, Amazon is becoming “increasingly monolithic in markets like books and electronics,” which is why he believes that antitrust authorities will inevitably come to scrutinize Amazon’s market power.
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Let’s hope that there will be politicians bold enough to take on Bezos before Amazon becomes, quite literally, the Everything Store.

No, the Internet is
not
the answer, especially when it comes to the so-called sharing economy of peer-to-peer networks like Uber and Airbnb. The good news is that, as
Wired
’s Marcus Wohlsen put it, the “sun is setting on the wild west” of ride- and apartment-sharing networks.
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Tax collectors and municipalities from Cleveland to Hamburg are recognizing that many peer-to-peer rentals and ride-sharing apps are breaking both local and national housing and transportation laws. What the
Financial Times
calls a “regulatory backlash”
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has pushed Uber to limit surge pricing during emergencies
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and forced Airbnb hosts to install smoke and carbon monoxide detectors in their homes.
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“Just because a company has an app instead of a storefront doesn’t mean consumer protection laws don’t apply,” notes the New York State attorney general Eric Schneiderman, who is trying to subpoena Airbnb’s user data in New York City.
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A group of housing activists in San Francisco is even planning a late 2014 ballot measure in the city that would “severely curb” Airbnb’s operations.
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“Airbnb is bringing up the rent despite what the company says,” explains the New York City–based political party Working Families.
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The answer is to use the law and regulation to force the Internet out of its prolonged adolescence. Whether it’s Philadelphia’s 2013 decision to ban 3-D-printed weapons
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or a 2014 European Court of Human Rights ruling on the responsibility of websites to police their users’ comments
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or California governor Jerry Brown’s 2013 bill to outlaw online revenge porn
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or the French so-called anti-Amazon law, which doesn’t allow free shipping on discounted books,
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or Thomas Piketty’s call for a global tax on plutocrats like Mark Zuckerberg or Larry Page, active legislation is the most effective way to make the Internet a fairer and better place. Rather than asking what will life be like after the Internet, the real question is what life could be like if the Wild West openness of the Internet were tempered by the external authority of government.

But these external controls don’t always need to originate from government. One of the most effective strategies for fighting online piracy has stemmed from voluntary, market-led solutions uniting private companies across the Internet economy—from content creators and ISPs to payment processors and even search providers. In 2011, for example, there was a US-based voluntary agreement, the so-called “six strikes” copyright enforcement plan, signed by AT&T, Cablevision, Comcast, Time Warner Cable, Verizon, and the major record labels, designed to reduce online piracy.
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Beginning in June 2011, American Express, Discover, MasterCard, PayPal, and Visa worked with the City of London Police on a set of best practices for withdrawing payment to websites that distribute stolen content.
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And in July 2013, AOL, Condé Nast, Microsoft, Yahoo, and Google were among signatories of an Interactive Advertising Bureau plan designed to cut off the flow of advertising revenue to websites profiting from illegal content.
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These kinds of voluntary efforts by the private sector should be seen as complementing rather than competing with government efforts to police the Internet. Indeed, as the then US Intellectual Property Enforcement coordinator, Victoria Espinel, noted about the 2013 Interactive Advertising Bureau plan, it would actually “further encourage the innovation made possible by an open Internet.”
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Libertarian disruptors like John Perry Barlow and Alexis Ohanian would, no doubt, disagree with Espinel, arguing that any kind of external controls on the Internet would undermine innovation. But this is wrong, too. As AOL founder Steve Case has argued, the “coming Internet revolutions in areas such as education and health care” will require partnering with government.
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And as Sussex University economist Mariana Mazzucato showed in her important 2013 book,
The Entrepreneurial State
, the most significant innovations—such as Tim Berners-Lee’s invention of the World Wide Web at CERN in 1989—have come out of the public sector.
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Even Google and Apple, Mazzucato notes, were originally funded by public money—Apple by a $500,000 government loan before it went public and Google by Sergey Brin’s National Science Foundation grant to fund his graduate studies at Stanford.
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I’m not sure I’d go quite as far as the Canadian political theorist Michael Ignatieff, whose answer is “a new Bismarck to tame the machines.” But Ignatieff’s question is the most important one facing us all in the early twenty-first century. “A question haunting democratic politics everywhere,” he says, “is whether elected governments can control the cyclone of technological change sweeping through their societies.”
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The answer to Ignatieff’s question is yes. Elected governments exist so that we can shape the society in which we live. There’s no other alternative to controlling technological change. Not distributed capitalism or peer-to-peer government or MOOCs, data factories, or some other libertarian scheme to make a few Internet entrepreneurs obscenely rich and powerful. From downtown Rochester to London’s Berwick Street to Silicon Valley itself, that cyclone is doing much more harm than good. The Internet’s current Epic Fail isn’t necessarily its final grade. But to improve, it needs to grow up quickly and take responsibility for its actions.

The Alien Spaceship

A couple of weeks after meeting Michael Birch, I had lunch with a friend at the Battery. There was no Soylent on the menu. Instead, we dined on grilled octopus and shared a vintage bottle of Russian River Chardonnay. The service, the wine, and the organic food produced by local, sustainable farms were all impeccable. We were treated like lords by the club’s obsequious domestic staff—which wasn’t surprising, since the Battery had been designed by Ken Fulk, the high-society event planner who organized Sean Parker’s $10 million
Lord of the Rings
fantasy wedding and who is a big fan of television dramas like
Downton Abbey
that glorify two-tier societies.
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After lunch, I took a tour of the Battery, which, with its not-so-secret poker room and its wood-paneled library lined with unread books, resembled a nineteenth-century gentleman’s club as imagined by a twenty-first-century fantasist. The Battery might have been a gigantic Instagram photo.
Hello this is us
, it was saying about a Silicon Valley that has seceded from time and space. Half a century ago, J. C. R. Licklider imagined a human-computer symbiosis that would “save humanity.” Little did Licklider imagine, however, that his intergalactic computer network would end up financing the building of an alien spaceship in downtown San Francisco.

Chrystia Freeland, the author of
Plutocrats
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and an authority on the rise of the new global superrich and the fall of everyone else, has a compelling explanation of why fantasists like Fulk find nostalgic dramas like
Downton Abbey
so seductive. It’s a contemporaneous show, she argues, because there is a “profound similarity between the vast economic, social, and political changes that drive the action in ‘Downton Abbey’ and our own time.”
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In our digital age of perpetual creative destruction, Freeland says, technology companies like Google, Uber, and Facebook are, on the one hand, enabling the vast personal fortunes of twenty-first-century Internet plutocrats like Mark Zuckerberg and Travis Kalanick; and, on the other, wrecking the lives of a woman like Pam Wetherington, the nonunionized worker at Amazon’s Kentucky warehouse who was fired after suffering stress fractures in both feet after walking for miles on the warehouse’s concrete floor.

But there is one important difference between
Downton Abbey
and Silicon Valley, Freeland reminds us. “With their lavish lifestyles, the aristocrats of ‘Downton Abbey’ may seem like a 20th-century version of our own plutocrats, but they are not,” she says, because today’s “aristocracy of talent” have “all the perks and few of the traditional values” of the old Downton Abbey aristocracy.”
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And so, in the Silicon Valley of 2014, there are all the social and economic hierarchies of 1914 without any of what Freeland calls “the social constraints” of the old aristocracy. We have Downton Abbey reinvented as the Battery. We have secession fantasies and $130 million yachts as long as football fields and billionaire uberlibertarians with staffs of black-clad blondes and white-coated butlers. We have massively meretricious wealth with minimal social responsibility. We have a new nobility without any noblesse oblige. What we have is certainly not the answer to the deepening economic and social inequalities and injustices of the early twenty-first century.

The answer, then, can’t just be more regulation from government. Noblesse oblige, after all, can’t be legislated. As critics like Tim Wu have argued, the answer lies in our new digital elite becoming accountable for the most traumatic socioeconomic disruption since the industrial revolution. Rather than thinking differently, the ethic of this new elite should be to think traditionally. Rather than seceding to Burning Man or Mars, this plutocracy must be beamed back down to earth. “Move fast and break things” was the old hacker ethic; “you break it, you own it” should be the new one. Rather than an Internet Bill of Rights, what we really need is an informal Bill of Responsibilities that establishes a new social contract for every member of networked society.