Two Truths and a Take, Season 2 Episode 5
|Alex Danco||Feb 23|| 18|
Here are two aspects of the anti-tech backlash that I believe are both true, and are actually reciprocally related to each other:
Critics in media, politics, and even in tech itself, who spend all day in the echo chamber, usually overestimate how many people out in the real world actually believe that Silicon Valley internet companies are villains. As anti-tech rhetoric gets louder, we perceive it as more widespread than it actually is.
Conversely, tech leaders don’t appreciate how resonant and cohesive the anti-tech movement actually is. As we cordon off the current backlash to a subset of critics, we fail to appreciate what exactly this movement is about, and what it stands for.
Anti-tech sentiment is far from a universal stance. But it’s more coherent, and therefore more dangerous, than I think most tech leaders realize. To really understand this movement, you need to recognize it as part of a reaction to something bigger than tech. It’s a rebellion against postmodernism.
This post is going to cover a lot of ground:
How innovation overtook progress
The resonance and coherence of the anti-tech movement
The rebellion against postmodernism
Guess which tech leader is sort of a Marxist?
What is postmodernism, and how did we get here?
100 years ago, we were right around the peak of a movement that straddled the 19th and 20th centuries called modernism. Modernism is a big idea: it’s a way of looking at the world, thinking and acting in it that subsumed more or less everything happening in the west. You know that joke where the fish asks, what is water? Modernism was like water.
Modernism fundamentally cared about progress. Your impression from looking around the world, even just looking outside your window, was of definite, forward progress everywhere. Houses went from dark to light. Travel went from slow to fast. Infection went from deadly to curable.
Whatever the challenge, modernism promised: Make it New! This impression came from everywhere. We saw it in art, literature and architecture; we saw it in political movements; we saw it in the transformation of neighbourhoods as they came alive with electricity, gas and plumbing. We also saw it in terrible things, like the Great War, where soldiers were killed in unthinkable numbers. More than anything else, the modernist mindset had a strong concept of forward.
Then came the hangover. Postmodernism began as a conscious reaction to modernism: disillusion with absolute ideals and unstoppable progress; new emphasis on subjective experience and relative change. Postmodern art and culture emphasized a meta-awareness of the old utopian ideals, often by mocking them. New was out. Irony, remixing, and self-reference were in.
Eventually postmodernism just kind of became everything, just as modernism had 50 years before. The way we looked at the world got reoriented around the viewer, the user, and especially the customer. The common threads that tied postmodern art and culture to 20th century consumer capitalism were two forces: commodification and transformation. In art, this looked like print media and other creative forms of remixing and self-aware reproduction: think Andy Warhol, R&B sampling, and Pulp Fiction.
We did it for art, and then we did it for everything else. Over time, we perfected the postmodern “front of house / back of house” service delivery model. The back of house grinds out commoditized ingredients, and then the front of house crafts an experience, transformed and re-transformed to delight the customer.
One important idea to grok if you want to really get postmodernism is Beaudrillard's concept of simulacra: reproductions of an original which no longer exists, or never existed. Walk into a Whole Foods or Starbucks and you’ll see it: the whole place has been crafted, complete with faux-authentic food crates and coffee bean sacks, to recreate this farm-to-market experience that stopped existing a long time ago. We know it’s not real, but we appreciate it. (For more on this, read Venkatesh Rao’s essay The American Cloud.)
Once you figure out simulacra you start see them everywhere, because we increasingly interact with representations of things, rather than things themselves (brands, media, interfaces, and especially digital technology). Our daily lives are a collage of them, and it's actually pretty pleasant. It feels nice to click the save icon, even if the floppy disk has no tangible meaning anymore; and really, neither does “saving” a file at all. It’s nice in the same way that Starbucks is nice.
This all happens against a backdrop of capitalism. On the front end, our consumption gets increasingly varied, low-commitment, and disposable: we consume in the moment, knowing that tomorrow we’ll get to choose again. On the back end, ownership gets progressively abstracted away, and insulated from its consequences.
It makes intuitive sense that these two things are related. As our consumption becomes more disposable, we develop a taste for easy variety and differentiation. And the cheapest way to serve up variety is through simulacra: commodify and capitalize the back end; transform and retransform the product offering. Give it enough iterations, and you get the airline industry: lose money flying planes so you can make money selling imaginary credit card tiers.
A real-life example that we’ve talked about in this newsletter is cooking-as-a-service. Food used to come from a farm; then it came from a grocery store hooked up to the food cloud, owned by a bank; now it comes from a delivery courier, hooked up to the cooking cloud, owned by a sovereign wealth fund. This is a very postmodern form of progress: food isn’t necessarily getting better, or more nutritious, or even cheaper. But it’s exactly what you want, and the more you like it, the richer someone gets.
Out with Progress, in with Innovation
I hope you can appreciate at this point that the modernists and the postmodernists have different ideas about how to build the future. The lazy way to think of it is that modernists care about what we can make, whereas postmodernists care about what we can get. This isn’t far from correct, but it misses the real distinction which is subtler.
The best articulation I’ve heard is from Peter Drucker’s book The Landmarks of Tomorrow. To Drucker, the modernist saw progress as an assertion of human power. Progress was a demonstration of superiority over the cold, dark and chaotic. It fit seamlessly with the modernist concept of forward: progress was something that inevitably happened, because humans moved forward.
Drucker understood that the 20th century mindset was different. To the postmodernist, progress isn’t inevitable; it is a leap into the unknown that may or may not pay off. The postmodernist thinks skeptically about risks and tradeoffs, what it means to take that leap, and under what conditions one should do so. This isn’t how 19th century leaders and nations thought about technological progress. This new attitude comes from finance, where everything is understood as a risk.
This new attitude needed a new word, and we found one: Innovation. As Drucker put it presciently:
Innovation is more than a new method. It is a new view of the universe, as one of risk rather than of chance or of certainty. It is a new view of man's role in the universe; he creates order by taking risks. And this means that innovation, rather than being an assertion of human power, is an acceptance of human responsibility.
As progress becomes a question of assumed risk, rather than asserted power, building the future looks less like a mission and more like arbitrage. Innovation means identifying a window of opportunity to move capital in, assuming the risk of value creation within that window, and then exiting as the opportunity closes.
The upside of this approach meant that any capital, not just mission-driven capital, could participate in building the future. The downside is that capital is mobile: it only sticks around when it can find no better options. The compromise we reach in practice looks like present-day American Cloud: effective, but alienating.
Oddly enough, the person who figured this out first was Karl Marx. Admittedly, Marx’s mindset presumes a degree of liquidity that most real-life investors could only dream of. But his basic idea of founders and investors as arbitrageur of opportunity is correct. The modern progress economy dealt in technological potential and progress, whereas the postmodern innovation economy dealt in windows of opportunity that open and close.
In other words, Karl Marx understood Venture Capital better than you thought.
Memes, Fortnite, SaaS, and Simulacra
Life imitates art, especially online. Internet culture is a kaleidoscope of self-referential simulacra, beyond anything the mid-century postmodernists imagined.
Frederic Jameson wrote in Postmodernism: The Cultural Logic of Late Capitalism: "The culture of the simulacrum comes to life in a society where exchange value has been generalized to the point at which the very memory of use value is effaced, a society of which Guy Debord has observed, in an extraordinary phrase, that it in it ‘the image has become the final form of commodity reification.’”
He may as well have been talking about the internet, because that mouthful of words is just a fancy way of saying "everything became memes, and then memes became everything".
The most influential media franchise today, and arguably one of the most important software products today period, is a video game that makes billions of dollars a year by selling remixed dance moves and cool-looking weapon skins. The postmodern work ethic is hard at work online: commodify the back end, transform and retransform the front end. Sound familiar? It’s the dominant motif for value creation in the tech community: the Platform and Applications cycle.
(From Dani Grant & Nick Grossman - The Myth of the Infrastructure Phase)
I’ve written about this before, both in the newsletter and in Scarcity in the Software Century: software is a fantastic template for incrementally building the future, because it pulls itself forward in a positive feedback loop I call the abundance cycle. Platforms and applications pull each other forward into existence, and in doing so, building the future becomes a matter of fulfilling demand that either already exists, or can at least be seen clearly. It’s a bit of a random walk, but it really gets us somewhere.
Today’s tech industry really is a triumph of the postmodern work ethic. No one cares about your product; we care about your adoption. No one cares about what your technology does; we care about what problems it solves for users, and how fast you can grow. The first commandment of tech is Build Stuff People Want.
The second commandment is Don't Reinvent the Wheel Every Time. There’s a reason why tech products have a unified look and feel: they’re made out of 99% of the same parts. There’s more to it than selling skins on Fortnite, but shipping software and internet products mostly means transformation and retransformation, A/B testing and optimization, as the product eventually becomes the copy of a copy of an original that’s been lost in time.
The upside to this approach is that it gets you somewhere. But the way you get there, for the most part, is through combinatorics: trying out new skins and new interfaces for a deck of perpetually shuffled cards. The postmodernist looks at a mega success story like Uber, and sees a triumph of innovation. Uber seized a window of opportunity to reinvent transportation as an on-demand service. It's mobility on tap, like running water. Who wouldn’t want this?
Then the modernist looks at Uber and asks: but where is the progress? It’s still the same car, and it still needs a driver. It moves the same speed, burns the same gas, and gets stuck in the same traffic. What has actually changed?
Peter Thiel, Marxist?
I think you can generally distill down most of anti-tech criticism into two main points.
The first point is “The tech industry is the worst of late capitalism.” This critic argues that the prime directive of tech companies is to move fast and break things, exploit labor, regulatory and geographic arbitrage, and then extract shreds of profit out of dying institutions in the name of consumer convenience. Amazon destroyed retail, Google and Facebook destroyed newspapers, Uber is destroying labor, Airbnb is destroying neighbourhoods; that kind of thing.
The second point is “These are just stupid apps.” This critic argues that we’ve gone all-in on an innovation economy that’s fine tuned to produce profitable but pointless bullshit instead of solving any real problems. To this critic, the window of opportunity for reshuffling existing stuff will almost always be open wider than the window of opportunity to invent something fundamentally new.
I know plenty people in tech who genuinely don’t think that “tech is destroying everything” and “tech will fund superficial over substance every time” are overlapping accusations, or even valid criticism at all. And why would they? To a postmodernist, these aren’t even negatives. Destruction is simply a part of value creation, and the next big thing starts out looking like a toy.
To the postmodernist, software and the internet are the conclusive answer as to whether or not we’re making any progress. Of course we’re making progress! The S&P 500 is dominated by venture-backed software companies, and even though Silicon Valley did not produce the most globally disruptive technology of the past decade (that would be fracking), the Bay Area is still the consensus cradle of the future. Even the value shop bears who call the tech bubble bursting every year will grudgingly admit: it somehow never does.
And then there’s Peter Thiel. I’ve come to appreciate that one of Thiel’s more interesting and less appreciated points of view on tech is his assertion that we have stopped believing in the future. (Tech people nod along in agreement until they realize that Thiel is specifically talking about us.) Furthermore, he specifically calls out software as part of the problem. He wrote an essay called The End of the Future for the National Review in 2011 where he pondered:
The economic decoupling of computers from everything else leads to more questions than answers, and barely hints at the strange future where today’s trends simply continue. Would supercomputers become powerful engines for the miraculous creation of wholly new forms of economic value, or would they simply become powerful weapons for reshuffling existing structures — for Nature, red in tooth and claw? More simply, how does one measure the difference between progress and mere change? How much is there of each?
There are a few ways you can read this. One reading sees software as overrated or perhaps even neutral as a progress-driver in society: if it’s just rearranging existing pieces, then it’s probably just rearranging value too. Another reading sees software as useful, but overbought and heading for a correction.
But there’s a more interesting way that you can interpret this, which is that Thiel sees software as part of a broader culture war.
My reading of The End of the Future, Zero to One and Thiel’s other writing is as a criticism of postmodernism in general. In this worldview, we lost the path to technological Eden when we stopped believing in the literal and in the inevitable. As Drucker called it 60 years ago, we chose innovation over progress. Today’s founders and VCs have found success by randomly walking into tomorrow, iterating towards any combination of existing pieces that produces a subjectively better outcome for a customer. Hey, it works!
Thiel’s “strange future where today’s trends simply continue” almost looks like a perpetual motion machine, where Silicon Valley eventually gets enough capital and enough momentum spun up that it can keep repeatedly jamming open those windows of opportunity, commodifying and transforming anything in scope into perpetually new simulacra as they pass through: another successfully executed arbitrage. Tech is now wealthy enough to do this self-sufficiently; the only question now is whether we'll get bored.
That’s why the anti-tech backlash of “tech is destroying everything” and “tech will fund superficial over substance every time” matters as a combined narrative. It’s a genuinely coherent worldview, it calls out something bigger than software, and it hits at a particular moment in time where the United States government has introduced Star Trek-inspired Space Force aesthetics and has moved to mandate classical architecture in courthouses, which may not be as random as you think.
Anyway, all of this is really just a long winded way of saying: Bitcoin.
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Have a great week,