Felix Stalder on Thu, 31 Mar 2016 09:46:22 +0200 (CEST)

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<nettime> Mozorov: The world run by Silicon Valley

Mozorov is getting better and better. I read this piece below in
parallel with two others. First, Sascha Lobo's column in Der Spiegel
[1] in which he showed, by simple analysis of news reporting, that
15 out of 15 identified terrorists involved in the recent deadly
attacks in Europe where previously known to the police, put on various
watch-list, but not apprehended or even closely watched. Still mass
surveillance is touted very time as the solution. Why? Because it's
cheap, requires little labour, a technological push-button solution
which fits perfectly into the neo-liberal dogma of a downsized,
outsourced state.

The second article [2] is about how outsourcing inside silicon valley
contributes to the rise of inequality and a sharply racialized



The state has lost control: tech firms now run western politics
Evgeny Morozov

Sunday 27 March 2016 00.03 GMT


By now, the fact that transatlantic democratic capitalism, once the
engine of postwar prosperity, has run into trouble can hardly be
denied by anyone with the courage to browse a daily newspaper.

Hunger, homelessness, toxic chemicals in the water supply, the lack
of affordable housing: all these issues are back on the agenda, even
in the most prosperous of countries. This appalling decline in living
standards was some time in the making – 40 years of neoliberal
policies are finally taking their toll – so it shouldn’t come as a

However, coupled with the spillover effects of wars in the Middle
East – first the refugees, now the increasingly regular terrorist
attacks in the heart of Europe – our economic and political malaise
looks much more ominous. It’s hardly surprising that the insurgent
populist forces, on both left and right, have such an easy time
bashing the elites. From Flint, Michigan, to Paris, those in power
have accomplished such feats of cluelessness and incompetence that
they have made Donald Trump look like a superman capable of saving
planet Earth.

It seems that democratic capitalism – this odd institutional
creature that has tried to marry a capitalist economic system (the
implicit rule by the few) to a democratic political one (the explicit
rule by the many) – has run into yet another legitimation crisis.

This term, made popular by the German philosopher Jürgen Habermas
in the early 1970s, aptly captures the dissonance between the stated
objectives of our political institutions – the need to promote
equality, justice, fairness – and today’s harsh political reality,
where the very same institutions often stand in the way of upholding
those values.

Habermas’s initial conception of legitimation crisis emphasised
its cultural dimension, for, as he assumed at the time, the smoothly
running welfare state, despite all the naysaying by the radicals, was
reducing social disparities, empowering the workers and ensuring that
they got a growing share of the still-expanding economic pie.

    Those in power have accomplished such feats of incompetence that
they have made Donald Trump look like a superman

That argument did not age well. As became obvious a decade later,
governments were increasingly forced to resort to a panoply of means
to continue satisfying both capital and labour – a trajectory that
has been well documented by Habermas’s main opponent in Germany, the
sociologist Wolfgang Streeck.

First it was inflation; then it was unemployment; then public debt;
eventually it was financial deregulation in order to facilitate
private debt, so that citizens could at least borrow money to buy
things that they could no longer afford and that the government, now
subject to neoliberal dogmas about the virtues of austerity, could
subsidise no more.

But none of those solutions could last, simply postponing – but not
resolving – the legitimation crisis. Today, global elites face two
options for dealing with its latest manifestation. One is to accept
the anti-establishment populism of Bernie Sanders or Donald Trump.
Even though the two disagree on many social and political issues, both
oppose the neoliberal consensus on globalisation, challenging the
mainstream views on the virtues of free trade (as codified in treaties
like Nafta or TTIP) and the need for America to play a robust role
abroad (both would prefer a more isolationist stance).

The other option, and a much more palatable one to the Davos crowd,
is to hope for a miracle that would help convince the public that the
structural crisis we are in is not structural and that something else
– big data, automation, the “fourth industrial revolution” –
will step in to save us or, at least, delay the ultimate rupture, a
process that Streeck, brilliantly, has characterised as “buying

Today, however, there’s a major change. While the financial industry
has historically been key to “buying time” and staving off the
populist rebellion, in the future that role will be assigned to
the technology industry, with a minor role played by the global
advertising markets – the very magic wand that allows so many
digital services to be offered for free, in exchange for our data.

The contours of this new accommodation between governments and
industry are already beginning to emerge. Real incomes might be
stagnating and the population might no longer want to take any more
debt but there is no cause for panic: after all, a growing number
of services, from communications to preventive healthcare, are
already free. Plus, we have new ways to make our ends meet, mostly by
prostituting our free time and other possessions. And the government,
as the latest budget reveals, would even be happy to offer tax
allowances to such micro-entrepreneurs!

Since all this data generated on digital platforms has an immense
market value, it can be profitably sold off to fit any holes in
the budget – including by governments themselves. Universities,
insurance firms, banks: plenty of companies would be happy to buy it.

Finally, technology firms – thanks to data they collect – can
always position themselves as essential to fighting the terrorist
threat. For every Tim Cook fighting the FBI, there’s a Peter Thiel,
the famed venture capitalist and the chairman of Palantir, a $20bn
machine-learning giant that caters to the defence establishment. In a
recent interview, Thiel even boasted that Palantir’s technology had
helped thwart terrorist attacks. The ‘gig economy’ is coming. What
will it mean for work? Arun Sundararajan Read more

The grim reality of contemporary politics is not that it’s
impossible to imagine how capitalism will end – as the Marxist
critic Fredric Jameson once famously put it – but that it’s
becoming equally impossible to imagine how it could possibly continue,
at least, not in its ideal form, tied, however weakly, to the
democratic “polis”. The only solution that seems plausible is by
having our political leaders transfer even more responsibility for
problem-solving, from matters of welfare to matters of warfare, to
Silicon Valley.

This might produce immense gains in efficiency but would this also
not aggravate the democratic deficit that already plagues our public
institutions? Sure, it would – but the crisis of democratic
capitalism seems so acute that it has dropped any pretension to being
democratic; hence the proliferation of euphemisms to describe the
new normal (with Angela Merkel’s “market-conformed democracy”
probably being the most popular one).

Besides, the slogans of the 1970s that were meant to bolster the
democratic pillar of the compromise between capital and labour, from
economic and industrial democracy to codetermination, look quaint in
an era where workers of the “gig economy” cannot even unionise,
let along participate in some broader management of the enterprise.

There’s something even more sinister afoot though. “Buying time”
no longer seems like an adequate description of what is happening, if
only because technology companies, even more so than the banks, are
not only too big too fail but also impossible to undo – let alone
replicate – even if a new government is elected.

Many of them have already taken on the de facto responsibilities of
the state; any close analysis of what’s happening with “smart
cities” – whereby technology firms become key gateways to
essential services of our cities – easily confirms that.

In fact, technology firms are rapidly becoming the default background
condition in which our politics itself is conducted. Once Google and
Facebook take over the management of essential services, Margaret
Thatcher’s famous dictum that “there is no alternative” would no
longer be a mere slogan but an accurate description of reality.

The worst is that today’s legitimation crisis could be our last.
Any discussion of legitimacy presupposes not just the ability to
sense injustice but also to imagine and implement a political
alternative. Imagination would never be in short supply but the
ability to implement things on a large scale is increasingly limited
to technology giants. Once this transfer of power is complete, there
won’t be a need to buy time any more – the democratic alternative
will simply no longer be a feasible option.


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