Greene refers to Silicon Valley as the Fifth Estate as it has come to replace also the media (which is referred to as the fourth estate) as the main source of information
Almost all of us are in awe of technology as it has revolutionised the way in which we lead our lives. Who doesn’t use Facebook or buy goods on Amazon or has lived without searching for things on Google or is unfamiliar with Apple? There will be near unanimity that these four companies with the acronym GAFA, and more like Uber, Airbnb and their likes have changed the way in which a lot of business and human activity is conducted. We all recognise the value technology has brought in making our lives easier and more efficient.
But that is not how Lucie Greene sees it, and the book Silicon States is an exposition of how powerful these technology companies have become and how they virtually control our lives. They are actually guiding our lives and as time goes on, we will become subservient to them. There is method to the approach pursued and this is a conscious attempt to make us dependent on Silicon Valley. Look at Amazon for example, which has gotten into every sphere of our lives in India too, and we can now buy our smallest needs online. While they have captured the larger share of our wallet today, in the next 10 years they will also decide the terms of engagement as we will have less choice. This is the power of these tech companies. Moreover, Amazon never says it is serving humanity and is driven purely by profit.
Governments, too, are not spared of its influence and GAFA permeates every sphere of activity, whether it is space programmes of the US or contracts bestowed to different vendors. We in India know how companies wield considerable power over government policy. These technology firms do the same quite unobtrusively with the same result. Their financial clout and power is just amazing and hard to stop. They have gotten involved in defence strategy in the Middle East. The UK government has turned to Google for machine learning for health services. Elon Musk is directly involved in the construction of spaceships. Therefore, these names are common in government corridors.
Interestingly, the author talks about artificial intelligence (AI) and its perverse effects for governments, which in a way are frightening. To begin with, unemployment will become a major issue as people become redundant. Use of driverless cars means that there will fewer vehicle trespasses and the quantum of fines will come down that can affect the revenue of states and municipal bodies. Airbnb has caused quite a disruption in the real estate sector, both for property purchases as well as leases. More importantly, Facebook is embroiled in a controversy over how data has been used by political parties during elections, and the role of Russia interfering with polling patterns was significant during the US elections.
Tech companies with their deep pockets have the wherewithal to influence government policies relating to immigration; and the power exerted is quite mind boggling. Also, Greene points out that Facebook and Google are beneficiaries of major government advertising purchases and hence a quid pro quo can be easily established here.
Quite interestingly, Greene refers to Silicon Valley as the Fifth Estate as it has come to replace also the media (which is referred to as the fourth estate) as the main source of information. Silicon Valley has full control over news and its dissemination, which can leave the media far behind. While in a competitive environment all can be justified, under economic Darwinism, the advent of fake news and guided news by those with power can distort the way we form our opinions. As people move away from newspapers to WhatsApp and Facebook, the quality of information is hard to monitor. Already advertising revenue has moved away from the press to social media, and in 2016 as much as $1 billion migrated from the fourth to fifth estate. Also, with a closed user group formed informally between these companies, any adverse report in the media has repercussions of a total boycott, which no media house is willing to risk.
Is the author overstating the power wielded by Silicon Valley? One is not sure as she has presented both facts and interpretations, which can be scary at times. Even when it comes to philanthropy, she terms it ‘hacking’ because she believes there is an ulterior motive to ‘control’ when money is given in the form of charity.
The organisations that receive money are opaque and there is no trail or audit here. But this can hold for any company set up to use such funds and cannot be taken as a negative only for Silicon Valley. Similarly, in her view, Silicon Valley spending a lot in Africa to get the internet accessible to the poor has a downside of how views are being moulded in a predetermined manner.
The author admits that a lot of good has happened due to Silicon Valley but the ulterior motives are what can raise questions. This is a fair point, but could be overstated at times. She has also turned the argument around for Airbnb as being detrimental to the environment as now more people travel, which adds to global warming given that travel is by air.
This sounds a weak approach for attacking Silicon Valley.
She points out that there has been discrimination against women in Silicon Valley companies, which again is generic, as the same holds true for several industries and technology alone cannot be faulted for this.
When reading the book there appears to be a very strong bias against the power which these companies wield and at times the benefits brought on the table are ignored as there is emphasis on the downside rather than the upside.
Some of the fears are legitimate, but to paint Silicon Valley as having some very negative designs may be stretching the argument to the extreme.
The author is chief economist, CARE ratings