As I have two decades of experience in tech, and an
extensive background in economics, I was interested to check out this book
after reading about its controversial claims. I doubted that I would agree with
all of its points, but might at least find something interesting in its
arguments. Unfortunately it did not succeed even in that meager goal.
Rushkoff, as best as I can tell is a media arts professor
(is that even a real academic discipline) who has an interest in technology.
Unfortunately he doesn’t even have the most basic layman’s understanding of
economics or history, nor the intellectual curiosity to find out. Instead this book is just a lightly researched
polemic, making ridiculous, often unsourced wide-sweeping claims. Even when I
checked out the few footnotes he included, his sources did not say what he said
they did. For example, the average Google employee does not quit within a year,
there are not 1.7 million medical bankruptcies per year (in 2015 there were
only 900,000 personal bankruptcies for all reasons) and companies are not
gobbling up tech firms with no revenues, left and right. For that last claim I
assume he actually meant profit, but it is hard to tell as he uses economic and
financial terms loosely out of context, and often meaninglessly.
I can appreciate a book even if I don’t agree with it, but
this book doesn’t even agree with itself. On one page the author condemns the
low starvation wages paid by major corporations in third world countries, then
a few pages later says that this is just a fiction of artificial exchange
rates. More than once in apocalyptic terms he talks of companies like WalMart
which are massive profitable behemoths strip mining the nation of all resources
and ripping off the consumer, it efficiencies paling in comparison to its “extracting”,
then he dedicates an entire section to how corporations are becoming less and
less profitable. Which is it? He condemns modern “monopolies” such as Facebook,
but then laments the demise of taxi cartels which supposedly supplied so many
good jobs, and then waxes romantically about medieval guilds, without noting
that both of them are textbook examples of cartels which restrict competition.
Historically speaking this whole thing about guilds that
becomes a foundation of his thesis is just bizarre and completely ahistorical.
He provides no sourcing or even argument to support his contention that they
represented some sort of apex of human “peer to peer” commerce; he just asserts
it as somehow better than modern corporations. As best as I can tell he learned
everything he knows about guilds from playing Dungeons and Dragons in high
school. Without defining the terms he refers to them as “value creation” while
modern corporations are “value extraction”. Romantic notions aside, however,
they create value in the exact same way. Whether I purchase an item from an
individual, a guild, or a corporation, I am doing it for the exact same reason,
because that good or service is worth more to me than the money or item I am giving
up in exchange for it. My trading partner is selling it to me for the exact
same reason. Simply labeling one exchange as creating and another as extracting
is ridiculous romanticism with no basis in economics, math or logic.
As an example of this, at one point the author criticizes
Facebook and other social media applications for mining user data, as in the
modern world that much data on personal preferences is valuable, and that it is
ripping off its users by not sharing this wealth with them. How, in fact, are
they being ripped off when they are more than happy to use these applications
(most provided entirely free) voluntarily. I have been on Facebook several
years and I do not know of a single person ever forced to use the application
at gunpoint. They obviously see some value in the application to themselves,
otherwise they would not use it. Whether Facebook also obtains some value, and
presumably they do otherwise they would not invest considerable resources in
running it, is immaterial to the user. Ironically Rushkoff also repeatedly
mocks these very same Internet startups in other parts of the book for not
having revenue, so apparently he expects them to share the money with customers
that he claims they are not making. And this is one of his more coherent and
consistent arguments.
The book gets somewhat better when it moves from the “history”
to the “solutions” phase, although many
of his solutions have absolutely nothing to do with what he claims were the
problems. Yes, local currencies and bitcoins are interesting, although as of
yet just libertarian thought experiments, but they do nothing to address the
issues of income distribution or economic stagnation that he claims are the
problem. Ironically in one section he condemns the Federal Reserve of the tool
of the rich to enslave the working class, and then promotes local currencies as
a solution to shortages of currency and credit, without noticing the fact that
the primary goal of the Federal Reserve is to act as a lender of last resort
and keep the credit and currency markets functioning properly. Rushkoff then
goes on to make the startling discovery that there are a variety of corporate
structures such as non-profits and employee owned companies, an entirely unsurprising
observation, given their existence for the last several centuries. It all gets
pretty bizarre though, at one point Rushkoff goes the full Mao and proposes we
all start farming “in shifts”. Hey, when the Soviets and Chinese tried that it
only killed a few tens of millions of people. What could possibly go wrong? I could go on for several thousand more words,
but I tire of this.
So in summary, this book easily rates as one of the most
mind-numbingly stupid books I have ever read. I hate to make such broad
generalizations, but in the hundreds, perhaps thousands, of books I have read
in my lifetime no other better examples come to mind. The author fails to make
a single coherent argument in this entire work, and we are all worse off for
having read it. In fact, one may say that it was value extracting. Hey, maybe
he was on to something after all? I award you no points (well, OK, one star
because that is the lowest Amazon will allow) and may God have mercy on your
soul.
