Rana Foroohar | How Big Tech and Finance Betrayed Us and What We Can Do About It

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and join our amazing community. And with that, please enjoy this week’s episode. What’s up everybody? My guest today is Rana Foroohar. Rana is Global Business Columnist and an Associate
Editor at the Financial Times. She is also seen as Global Economic Analyst
and one of the more knowledgeable and intelligent guests I’ve had on this program. This is a phenomenal conversation. It hits right in my sweet spot and where I
think this show dominates the competition, and that is at the intersection of technology,
finance, and culture, including a 40 minute overtime, focused primarily on the financial
side of this story, including a conversation about the overall macroeconomic picture, the
revival of populism among Western countries, and the real prospects that a splinternet
could emerge not only between the US and China, but also between the US and its Western European
allies. We’re living in one of these dramatic periods
of societal change and uncertainty that most generations never get to experience. And I think it’s being driven primarily by
a very particular set of Internet-enabled technologies that are currently undergoing
a rapid phase of consolidation, something we haven’t seen since at least the late 19th
century. And this was a period where people’s relationships
to nature and to the land were being radically reshaped by the railroads, by industrial capitalism,
urbanization, their sense of time and space, their relationships to their communities and
to each other were being profoundly reordered and this produced an unprecedented amount
of anxiety. And like today, it coincided with a rise in
populism and it calls for heavy handed regulation of what had become industrial monopolies that
were able to set prices and use anti-competitive tactics to bankrupt their competitors, to
the point where if you were an independent oil refiner, you had to sell to John D. Rockefeller. Because he not only got preferential rates
on his oil shipments, but he was getting rebates from the railroads on every barrel shipped
by his competitors. And these types of anti-competitive practices
were going on across the board in steel and tobacco everywhere. And it took a long time for the public to
catch up. And for journalists like Ida Tarbell to emerge
who could begin to bring unnecessary level of clarity to what was happening. And I think this is where we are today, and
people like Rana and Shoshana and other journalists and authors are beginning to take this on
in a way that we haven’t seen before. And I think it behooves all of us to pay attention
because the bad lines of 21st century capitalism and liberalism are being radically redrawn. And if we want to have a say in what this
world looks like and our place in it, we need to participate. And that starts with educating ourselves and
others about what’s going on and how we can start to fix it. And with that, please enjoy my very timely
and very important conversation with Rana Foroohar. Rana, welcome to Hidden Forces. Thank you so much for having me. It’s great having you here. So I read your book, loved it, we’ll talk
about it. But you opened the book with a quote from
Mary Shelley’s Frankenstein, and I couldn’t tell whether you were talking about big tech
or the book or- My own family. See, there’s that two or both. So why did you choose to open the book with
a quote from an early 19th century sci-fi horror novel? Well, you know I couldn’t think of anything
that better encapsulated what I felt I had learned at the end of doing this book, which
is, the book is kind of a 20 year history in some ways of how Silicon Valley and in
particular, the big tech platform firms went from utopia to dystopia. And they started with these incredible ambitions
to connect the world. Don’t be evil. It was a Google mantra. But by the end, and we’re not even there yet,
but we are where we are, 20 years in, we’ve got election manipulation, we’ve got cognitive
capture, we’ve got attention merchandising, we’ve got surveillance capitalism. So there are so many negative externalities
here. And I know, having spoken to some of the creators
of these firms, that they’re very torn. They may not say so when they’re sitting in
Capitol Hill, but they are torn. And I think they’re just beginning to realize,
and we are all just beginning to realize what the cost have been. And that’s essentially what Shelley was getting
at, what started as this dream of life became a monster. So what got you interested in this? In the topic? Yes. So two reasons. About three years ago, I was starting my new
gig as the global business columnist for the Financial Times. And my mandate was to write the world’s biggest
and most important economics and business stories in commentary form, so to do opinion
pieces. And whenever I start a new position like that,
I always like to follow the money and see, where am I gonna throw my energies? Where’s the money? Where’s the power? And as I dug into the numbers, it was really
interesting. I began to see that a lot of wealth and a
lot of political power had moved in the last decade from Wall Street to Silicon Valley,
and that turn was already happening. But if you think about the timing, 2007 the
smartphone, 2008 financial crisis, a lot of regulation on the street. What industry was rising? Tech. It actually took the market’s back up over
that time and now maybe leading them down. But the other thing that happened, and this
was really the thing that kind of drove me to do this book, a few weeks into that job
I come home one day and I open up my credit card bill and I look at it and there’s all
these odd charges like $1.99, $3, $5. And then I look at them and I start adding
them up and it’s over $900 in charges, and I think, “Oh my God, I’ve been hacked.” And then I started to look more closely and
I see they’re all from the App Store. And then I think, I don’t buy that many things
from the App Store. Who else has my password? My then 10 year old son, Alex. So I go downstairs and Alex is parked in his
usual afterschool position, which is on the couch with his phone. And it takes me a minute to get his attention
away from the phone. He’s playing something. And I start to quiz him about what’s happened. And as I dug in, it was really interesting. I realized that something had overtaken him. He had gotten into a game, as it turned out,
a soccer game, one of those games where it’s offered for “free”, and I put that in quotation
marks. You can download the game for free, but then
as you’re playing, you want to buy a better player, you want to get Ronaldo a pair of
cool new shoes, whatever it is, you start buying things in the course of the game. But you don’t necessarily realize it, especially
if you’re a 10 year old, that you’re buying things. And so little by little, as a measure of just
how addicted he was to this game he had spent in the course of a month over $900. Wow. I mean, he was pretty high in the rankings,
but come on. But the thing that was really, really interesting
to me is that. He’s a pretty good kid. He’s pretty good about asking for permission,
but he had not really realized this rabbit hole that he was going down. He was kind of in a fog. And so I became horrified as a mother. And needless to say that his phone was confiscated
and rules were set down, but I was fascinated as a journalist, and I thought, I got to understand
this business model. So you touched on a few things there with
your comment on your son, you’re really touching on the behavioral levers. We had Shoshana Zuboff on the show. We talked about this at length, but let’s
actually roll back a little earlier and talk a bit about this comparison to Wall Street
in 2007 with where we are today. We also had your managing editor, Gillian
Tett, on the program, and we talked about this and how for years Gillian has been saying
this, that she has felt like Silicon Valley resembles or has started to resemble or it
feels a lot like Wall Street pre-crisis. Can you flesh out that comparison a little
bit? How did we get here? Because Silicon Valley, they were the darlings. These guys, you worked in the dot-com bubble
in ’98- Yeah, I’m old enough. Right. And in London. So I’d love to hear about that. But these were back in the late ’90s I mean,
this was like the place to be. And even in the early 2000s and then even
after the crisis, there was a kind of sense that these are the real entrepreneurs. This is where real business is happening. These guys are going to save us. And now everyone hates them. Yeah. So how did we get here? Well, there’s a lot to unpack there. Let me take that in kind of three parts. So at the very most micro level, Gillian’s
actually right. If you look at transactions, there’s a lot
of asymmetry in financial transactions. And she wrote about that famously before the
crash, her book about Fool’s Gold, about the CDO crisis and the amount of asymmetry in
information on either side of a transaction. You can argue there’s even more asymmetry
in this new data capitalism that we’re all a part of. Because if you think about it, let’s go back
to Adam Smith, father of modern capitalism. He would have said that we need three things
to have a properly functioning market, equal access to data, transparency in terms of what
is actually being traded and a shared moral framework. Now, you could argue that none of those things
are in operation really in any kind of data transaction that you’re making right now. And that’s because data doesn’t have a set
value, at least that we know about it does to the big tech firms, and they’ll layer it
in ways that create exponentially more value. You have no idea what one transaction that
is surveilled by a big tech firm is worth, what 10 that are piled together, what your
search patterns plus your GPS data plus what smart devices may be tracking you or what
sensors are watching you cross the street, what that’s worth to Google. It’s worth a lot. We’re actually starting to see some numbers
on that and we can talk about that later, but that’s point number one. So a lot of asymmetry, totally unregulated. I mean, if you think that derivatives were
unregulated before the crisis, big tech is completely unregulated. Point number two is these institutions have
become, in some ways, I think, the new too-big-to-fail institutions, and I’ll explain why. I have a whole chapter in my book about this. As I said, early in my time with the financial
crisis, I started looking at how wealth and power had shifted from the street to the Valley
and then I started looking at, wow, what are all these cash rich firms doing with that
cash hoard? I mean, think about it, Apple. Apple was interestingly the first chapter
of my last book, which was actually about the financial- Makers and takers. … makers and takers. And it’s funny, in that book, I was trying
to talk about how financialization had become a real issue in our economy, that financial
markets have become the tail that wags the dog. And so business was really being led by finance
instead of the other way around. And I wanted to try and find the most Kafkaesque
example I could of how a company was interacting with the financial markets in a way that was
just distorting, unproductive, unhelpful. And what I thought of was back in, I think
it was 2014 or so, Apple had a ton of cash. I mean, it still does, but it had about 250
billion on its balance sheet at that point. It was 10% of all of corporate America’s liquid
reserves. Was that around the time Carl Icahn was rattling
the cage through a dividend? Carl Icahn was rattling the cage, and every
time Carl would tweet, the share price would go up, and Tim Cook, who had had dinner with
them in his home, and they had gotten to be buddies, was handing back money. And I thought, this is insane. I mean, for starters, why is this tweet not
market manipulation? But then I started thinking, well, why are
these buybacks not, and these dividend payments in the way that they’re being done, not market
manipulation? Because this is essentially paying out the
top 10% of the country that owns 80% of the stock. This company hasn’t actually needed to come
to the financial markets for operating capital since the early 1990s. Is this what our markets are for? So that huge tech companies can issue tons
of debt at really cheap rates, then park their own profits in overseas bank accounts where
they’re not taxable, at least not at the current rates in the US and we can get into the Trump
tax cuts and some of what’s happened to that cash word sense. And that’s happening within an industry that
one could argue every part of it that’s really important was taxpayer funded, the internet,
GPS, touchscreen technology. Think about that. That all came out of the Pentagon and came
out of DARPA, and this is what we’ve got. So I looked more deeply at that phenomenon
in this book. And what I found was that basically 80% of
corporate America’s wealth was living in the top 10% of firms that had the most data, the
most IP, the bulk of their cash hoard was an overseas bank accounts, not in cash, but
in bonds, corporate bonds. So they had become, in some ways, underwriters,
unregulated underwriters. I mean, Google and Apple were buying up corporate
issuances in the same way Goldman Sachs would have, sometimes 30% of a new offering, but
we had no idea what was going on. And that just struck me as, wow, there is
a new too-big-to-fail industry. If we think Wall Street has still got problems,
this industry is incredibly opaque and nobody knows about it. So you mentioned a lot of things just now. Sorry to threw so much at you. No, it’s fine. There’s so much I want to talk about. These types of conversations are challenging
because you’re right in my sweet spot. Awesome. Love it. It’s like both of the areas that I’m most
interested in talking about, technology and finance and also culture. So two things you mentioned that stuck out
to me. One is that the markets have become a mechanism
for transferring wealth. Yes. Right? And it’s a positive feedback loop. Yes. And it’s generating larger and larger amounts
of inequality. And in a sense, that is being reflected in
our politics. 100%. And actually you’re touching something. I said that there was a third part to that
question about how is Silicon Valley like Wall Street. If you think about Wall Street as the purveyor
of a kind of economic neo-liberalism, the idea that capital can go wherever it wants
to go, that’s usually where labor’s the cheapest. That creates a lot of great things, but it
also creates tremendous inequality, and it’s one of the reasons we have the politics that
we do, because you have these intense pockets of pain in certain countries because of the
dislocation of jobs. Well, Silicon Valley puts that on steroids. So if you think about capital being able to
fly over the problems of the nation’s date, data can do that even more easily. So I think about a company like Facebook as
almost the apex of neoliberalism. And I think a lot about this battle between
Zuck and Elizabeth Warren. And I almost think of it as, I mean, he’s
right when he says that she’s an existential threat, not just to breaking up Facebook,
to the entire economic order that it represents. So we’ve gone from hot money to hot data. There you go. That should be your third book. Yeah, hot data. I like it. I like that title. So one is that wealth transfer, we can go
down that rabbit hole for hours. And another thing you mentioned is Janeway’s
Innovation Economy, you mentioned … We had Bill on the show as well. Yeah, he’s so great. And we talked about this. Absolutely. And to even be more specific, it’s not that
the government created the internet, it’s that the government ceded the internet. That’s a great way to put it. The government made the funds available to
invest in what was otherwise an uninvestible proposition. Something that would have been so expensive,
rot with so much risk. And the other thing that Janeway talks about
is that the private sector is seeking to exploit and monetize as much of this existing technology
as possible, but that you’re not seeing that other transformational technology, and that
there is a role for the state as an investor in the early stage of the economic cycle,
of the innovation cycle where risk is fraught and where the private sector is unwilling
to make those investments. 100%. And it is interesting, I got interested in
Janeway because I heard him speak several years ago at an INET Conference and he was
digging into the idea of big tech’s role in inequality. And back then that was still just a kind of
a mind boggling idea, right? I mean, these were the innovators. These were the job creators. Heresy. It’s a heresy. How could you? But he really got me thinking and then I dug
a little deeper and I started reading people like Mariana Mazzucato, who makes the point
very smartly in her own work that, look, there are different ways of doing this. If you’re Danish, if you live in Israel, these
countries actually take stakes in the things that they support with taxpayer dollars. We couldn’t even take a stake out of the companies
we bailed out. Well, exactly right. Right? So I mean, even in that case. We need another podcast. In that case, we actually, on top of that,
we paid them twice. Right. Exactly. No, I mean, it’s kind of unbelievable. And it gets too, I mean, talking- Regulatory capture, all sorts of stuff. Oh my gosh, yeah. And also this mythology, this American mythology
of bootstrapping. I mean, listen, we were talking earlier, like
you, I’m the child of immigrants, I believe in bootstrapping, but the idea that we’re
all in it alone all the time is a false narrative. And it’s killing us. It’s going to kill the system if we’re not
careful. I feel like though, part of the resurgence
of that narrative came out of the failures of the government. What we saw in 2008 was a larceny, right? Yeah. What we saw was the system grinding to a halt,
and the power behind the throne, stepping in front of the throne and saying, “Okay,
we’re going to save the system, and now since we’re here, actually we’re gonna get a little
greedy and we’re gonna actually just really rape you.” Yeah, yeah, well. People saw that. That’s right. And I think among other things, the rise of
this type of ideological framework became more popular because people were like, “Well,
screw the government. The government’s not here to protect me. The government’s here to rape me. The government’s here to take my wealth.” Yeah, and I think maybe more particularly
screw the elites. Oh, absolutely. Which, you know, folks, I think … One of
the things I’m fascinated by is when you talk about the big tech regulation push, it’s far
left and far right. There’s a lot of people that see Mark Zuckerberg,
Jamie Diamond, Larry Summers, whoever you want to throw into the basket, that kind of
Silicon Valley, Wall Street, Washington beltway, as being all part of the same group of elites
that they feel sold them down the river, didn’t care about their interests, are part of a
rigged game that they’re never going to be able to engage in. And I actually think that we’re moving, and
we’ve already moved from occupy Wall Street to occupy Silicon Valley and those guys, particularly
if you see a progressive Warren government, I think that the tax issues are going to change
dramatically. The ability of them to monetize debt, the
way in which the business model is conducted is going to just change dramatically. And that’s gonna lead to a big correction,
I think, in valuations. I want to talk about that too. In fact, we’ve got a real issue here, Rana,
which is that I put together a rundown, but then this morning I saw your appearance on
CNBC and it got me thinking about how I want to talk about SoftBank and WeWork and Uber
and some of these Ponzi schemes that exist in financial markets. The AliBaba. So we’re going to do our best. But what you touched on, there was in the
book you talked about how that you believe that curbing Silicon Valley’s nefarious side
effects will become the signature economic issue for lawmakers over the next five years. Yeah. We had a crisis in 2008, right? Yeah. The market’s melted down. We hit 666 on the S&P. And even then, we didn’t get the type of regulation
that people expected and we certainly didn’t get fairness in the bailout. Yeah. Right? What do you mean when you say that? Are you saying that we’re going to get real
progress in terms of regulating Wall Street? And what’s that regulation going to look like? I’ve heard another interview you gave on the
way over here. Well, you said if you could have your perfect
candidate, you would merge Andrew Yang and Elizabeth Warren into one. Yeah, get their brains together maybe. It feels to me like part of the problem is
that I don’t see anybody that’s really addressing this coherently cause Andrew Yang doesn’t
want to regulate. Andrew Yang wants a dividend cause he wants
more money to the inputs, to the behavioral inputs into the surveillance capitalist model. I’m so glad that you asked about that and
I didn’t have time to flush out. But what I mean to say is that I want someone
like Yang who understands enough about the technology and the subtleties that he’s not
going to make a statement like just break them up, which is more a slogan than a solution. I love Elizabeth Warren. I think the world of her. I think she’s got her heart in the right place. But nobody, including Warren, has a 360 view
on how regulation is gonna ping pong around. And we can talk about that because there are
things we could do that would address the financial issues. There are things we’re going to do that would
address the monopoly issues, but then they can have side effects and things like national
security in privacy and civil liberties and first amendment. You need, one of the things I recommend in
my book actually is a task force of the smartest people independent to sit down with a short
timeframe, not forever, but a year, 18 months, and at least make a playbook of what are the
issues and what are the possible externalities when you start to move one lever. I mean, we really need to do that and it can
be done. Europe has gone and France in particular has
gone some way towards doing this. But what I like about Elizabeth Warren is
that she takes on the power aspect of this and power is the commonality between what
happened in 2008 and what’s happening now. The reason I’m more worried, and I think it’s
actually a bigger deal now, is that we’re talking about an entire economic system. So back then we were talking absolutely an
important deal. The financial system melts down. Our tax payer dollars are used to bail it
out. That’s huge. But we knew what was happening. We knew what the solutions were. I think we made the wrong bet. We didn’t ask the private sector to take any
pain. Right now we’re dealing with not just the
business model of the fangs, but everybody’s business model. Data surveillance is … Starbucks knows plenty
about you. J&J knows about you. John Deere knows, maybe not so much about
you, but a lot about cabbages. We’ll talk about John Deere here as well. Yeah. And that’s also a threat in terms of cybersecurity. So that fact, this is everybody’s business
model. It is as Shoshana would say, a new kind of
capitalism. That fact just exponentially increases the
urgency. And at the same time, and we haven’t even
gotten to my chapter on the Uberization of everything, the nature of these firms and
the way that they invest and create jobs or don’t create jobs is so different than firms
of the past. So you look at a company like Facebook or
WhatsApp, that’s the famous example that everybody uses. The market caps are huge, as big as some of
the last generation of tech firms, but they create a fraction of the jobs. And same again if you look at the industrials
of the past. So that disruption, that model is coming,
that’s gonna crunch white collar jobs so much. I mean, you can’t even believe the amount
of investment that is going into software now. Long-term, if we had the right education plan
in place, that would be a net gain. But in the short-term, there is going to be
broad and deep job dislocation of a kind that if we think that out of work steel employees
or truck drivers are upset now, man, just wait until the middle classes, the upper middle
classes start to feel this pain and I think we’re going to have a real revolt. So many things to talk about, just to fall
on the point about WhatsApp. Another great example that I’ve used in the
program before is Kodak and Instagram. Instagram got bought out the same year that
Kodak went bankrupt. Isn’t that interesting? Yeah. So your point is that the way that money is
made today, you can scale. Yeah. You can scale a very small number of employees
and shareholders or partners or whatever, and you can capture that market. Yeah, absolutely. It’s a winter takeoff phenomenon. When you shift from an economy that is run
on tangibles, widgets, things you can touch and feel to an economy based on intangibles,
it becomes easier to create a network effect, become big, eat everybody else’s lunch. You’re also needing to put less capital investment
into the ground floor onto main street. And that’s one of the interesting things. Remember Trump’s tax cuts a couple of years
ago? We were all told, “Hey, we’re going to give
the big tech companies a lower rate. They’re going to bring all this money home. They’re going to invest it.” Well, for starters, they put it in share buy
backs, but the fact is they don’t have to invest as much as you would invest to say,
build a new factory. I mean, the entire nature of capital investment
in the economy changes. And so that’s changing, I could go on, that’s
changing the Fed’s calculations about interest rates. That’s changing how we think about productivity. We are in a new world in which the main resource
is data. And if we don’t find a way to divide the pie
of that new world up more equally, we’re in for a world of political pain. So kind of, you touched on this before, you
touched on it again, the point has to do with barter. Yeah. It’s the fact that a lot of value’s being
transacted, but it’s not being priced. That’s right. And that in order for economies to function
properly, a capitalist isn’t the function, you need to have prices. We have had an imperfect capitalist system
for years because things like the environment are not prices in many cases. And so we end up exacting costs onto our environment
that we wouldn’t otherwise if they were priceable. It seems that we’ve been going in the opposite
direction. And that kind of brings us to a point about
industrialization where people went from being people to being labor to now being inputs. Absolutely. Or the raw material. I mean, it’s amazing. It really is like you’re living in The Matrix. Oh, we talk about The Matrix on this show
a lot. It is true- It’s religion on this show. Really? Oh my God, it’s so true though. I mean, it’s prescient. It’s- Very prescient. We are the raw material and our own patterns,
our behaviors, our thoughts are being studied, analyzed, and then sold back to us. So a number of things. One, when you were saying this is even worse,
this is worse than the financialization, this sort of datazation. You have a great quote in the book and it
flushes out one side of why I agree with you. You write, “One of the reasons that it’s tough
to tackle the challenges wrought by big tech is that we spend so much time being distracted
by it.” 100%. One of the things I often think about is the
automation, and I don’t mean it in the way that most people think about automation. I mean that we live in a world where more
and more of our lives happen automatically. We just assume things will work. We assume our car will work. If it breaks, we don’t know what to do. We certainly can’t fix it. And the average Joe engineer on the block
can’t fix it. You need to have computers to fix these things. If you get lost or if your phone goes down,
you don’t how to get home in many cases. I mean, it’s the same sort of phenomenon of
pilots who don’t have enough flight time who are relying on the automatic pilot, the auto
pilot, and then when the autopilot goes down, what do they do? It’s such a deep thing. You’re making me think about Zen and the Art
of Motorcycle Maintenance. I don’t know if you’ve ever read that- I have not, but I’ve heard it’s a great book. It’s really right in that area from a philosophical
standpoint. It’s also very, what you’re saying is kind
of Marxian, it’s like we are in this sort of capitalistic cycle where we’re becoming
more and more dislocated from the means of production. But what you’re talking about is very true. Except we’re being dislocated from ourselves. We’re being- Indeed. … pulled apart. Right? Indeed. Indeed. And we’re in an attention economy. This is a term that was coined by Tim Wu,
who’s at the sort of forefront of thinking about ways to regulate this and the Columbia
Law professor. To get back to your point about why technology’s
distractions are making it hard to solve the problem. Let me just give you a little example that
I’ve been thinking about a lot. One of the things that I talk about in my
book is that, and you may already know this, but in 1998 when Larry Page and Sergey Brin,
the founders of Google wrote their initial paper about search. They did that at Stanford. It’s online. Anybody can read it. There’s an abbreviated version. Then there’s a longer version that’s over
30 pages. And of course, as I was researching this book
I sat down and read the entire thing. Well, I get to almost the end in the appendix
section and there’s a two paragraph section on advertising and its discontents. And it basically lays out exactly where we
are. The guys say, “Okay. We’ve now told you what the search engine
is and how it will work. Now, how do you monetize it? One easy way would be through targeted surveillance,
looking at people’s personal data and then selling advertising against that.” However, they concluded that that would create
a diametrically different set of interests between companies and users that companies
could potentially mislead users, that even public entities could be misleading. I mean, they essentially predicted exactly
where we are. So that to me was a mind blowing thing. I thought to myself, surely other people are
talking about this. I’ve missed it. Somebody else’s reported this, some New Yorker
writer has written the like long story of that, two paragraphs. No. Guess why? Because people aren’t reading. They’re too busy tweeting, journalists. I mean, I’m stunned by the fact that sometimes
all you have to do is show up and read the documents, but people don’t do it anymore. And that’s the tip of the iceberg. So how are we going to solve something like
climate change when we’re all busy interacting in 280 characters and children are now as
the latest Common Sense survey said, getting most of their, not just entertainment, but
news from YouTube. I mean, my own son, I mean, think about this. He is in a household, divorced household,
two very involved parents in both households, three journalists, one activist, highly educated. He will sometimes come home and talk about
these facts he’s heard online that are just so clearly fake news. And I think, what’s happening here, that this
is someone who is at the highest level of privilege and is being inculcated with these
ideas through these new forms of media. So it’s actually really scary. And we’ve done a number of episodes on this. I did one where it’s the only one I ever did
where we didn’t have a guest. And I put together a series of clips, including
from The Matrix and it was based on Theodore Kaczynski’s paper, Industrial Society and
Its Future, the Unabomber. And one of the things that I talked about
and sort of that I want to bring up here is that, and Shoshana kind of touches on this
when she talks about the unprecedented. It’s so unprecedented that we don’t really
understand what’s happening. We don’t see how it’s dramatically changing
our lives and everything around us. Talk about the extent to which people are
distracted. It’s scary. Well, it is. I mean, two or three thoughts there, just
to dig down into the brain science for a minute. We’re kind of at the beginning of this. There’s not a lot of peer reviewed work, but
what we’re seeing is that brain patterns are being changed. Our ability to concentrate is being lowered. College professors, high school teachers are
now complaining that kids can’t come in and study the basic books. I mean, you mentioned at the very beginning
my quote from Mary Shelley. I just hope my kids will be able to … Well,
I know my daughter will make it through, but I hope Alex will be able to make it through
Frankenstein. The idea of doing 300 pages of reading is
becoming a problem for kids. Now, some people would say, “That’s all right. We’ve had these shifts in the past from print
to television, or, when were comic books were new everybody got kind of exacerbated about
that.” But I am skeptical. It’s not the same thing because it’s because
it’s not one-way. It’s two-ways. That’s it. There’s two-way communication there. And again, to bring up Shoshana, the whole
point about predictive algorithms is that the best predictions you can make are the
ones that you’ve already secured through your actions. If you guide- There you go. … if you guide the foot traffic on Pokemon
Go to that restaurant, you can predict with 100% reliability that you’re going to sell
50 pizzas today cause you know cause you sent the traffic there. It’s not that you’re predicting the traffics. And talk about an asymmetry of information. That’s the thing. You mentioned it earlier, it’s power. This is about power. It’s about power. And it’s about free will. Do we have free will? It’s about free will also. Do we have free will? Again, I’m jumping everywhere. I’m all over the place here. The papers are scattered. I hope your readers won’t mind. Yeah, no. Oh, sorry, your listeners. No, they won’t. I love this. I just want to make the best use of it. So you mentioned George Soros in the book,
another trigger. What’s it called, trigger warning George Soros. Trigger warning- Oh my gosh, I hope we don’t lose half the
readers right now. Yeah, yeah. So he gave a speech at Davos in January, 2018. He also gave one in 2017 and I think he gave
one to 2019 as well. But there’s an excerpt of that I pulled from
your book. And he’s explaining, for example, how big
tech was divesting people of their autonomy, and he said that, “It takes a real effort
to assert and defend with John Stewart Mill called the freedom of mind. There is a possibility that once lost, people
who grew up in the digital age will have difficulty in regaining it.” Yes. I worry so much about that. I see such a difference, not only in my children,
and it’s interesting, there is a difference possibly because of their gender, but also
their age. I have a daughter who’s 17 and a son who’s
now 13. Some of the early research is showing that
tween and teen boys are amongst the most susceptible to being kind of pulled into- Why is that? I wanted to ask you about, because I’ve seen
the same thing. Okay. So what I’ve been told, and again, I think
we’re at the beginning of this research, but what I’ve been told by some psychiatrist is
that tween boys, if you think about it from an evolutionary standpoint, they’re geared
up to be out with dad hunting, shooting, learning, learning about the world with a lot of quick
action and reward, reward or punishment quickly in repetition. So they’re looking for high repetition, quick
feedback and reward. That’s exactly what you get online. The only other thing that I have found in
my own life that even remotely replaces this is basketball for my son, the highest speed,
quick repetition, quick reward game. So I basically try and push him off now to
YMCA as much as I can to keep him off the phone. I read that in the book. You put that in the book. But that’s what we think so far. We don’t really know. I mean, teenage girls are being affected too. Many of them are, of course, prone to depression
and anxiety. Those levels, interestingly, in recent years,
had been tailing off and now they’re coming back, which is something that Jean Twenge
looks at in her book, iGen, which I quoted in this, is also a great read. Again, pretty new research, but what we’re
seeing is that social media in particular is she likens it actually to alcohol, to a
glass of red wine. Maybe one drink is good for you because maybe
you don’t want to be the only teetotaler at the party. And there’s some antioxidants and that’s good. Okay. So you don’t want to be the only kid without
a phone, that makes you kind of an isolated weirdo. But the more you start to have that second,
third drink, the more hours that you spend with social media in this kind of bubble world
where images are being perfected in this very unreal way, the more you start to suffer from
things like anxiety, depression, girls are getting eating disorders, having self harming
behaviors. I was actually moderating a conference on
this topic recently, and there were a bunch of kids there, high school and college kids,
and during one of the breaks, one of the young women came up to me and said, “You know, I
feel weird about how I use my relationship with social media that the other day it was
my dad’s birthday and I wanted to wish him a happy birthday, but I thought I didn’t really
want to post it, I just wanted it to be personal. But then I thought, if I do this and I don’t
post it, if I don’t have a picture or something on my Facebook page, is it real? Did it really happen?” Wow. So that is mind blowing and to me that gets
to what you’re saying, which is that this generation is being shaped differently. So many thoughts. So also for listeners, Nicholas Carr, the
author, has written a bunch of books on this, on technology and the brain, Sherry Turkle
also. Yeah, she’s great. Yeah, she has. She found, actually … I spoke to her recently
and some of her research is on empathy. She’s doing a lot of work on how this changes
how we relate to one another as human beings and how we actually empathize. She found that if I were to pull out my phone
right now and put it on this table between us, that would automatically decrease the
empathy of the conversation. And by empathy, I don’t mean that we’re unliking
you. It means I’m looking to understand you and
where you are. Can you think of anything more useful in our
society today than trying to reach across the table and understand where someone else
is. Yeah, so in Alone Together she actually gives
a great scene when she’s at the ZOO and her daughter sees a turtle and she makes the point
like it would’ve been better if they just had a robot, like why do they even have the
regular turtle there? And she was sort of confused by that. It might’ve been her daughter or a girl that
was next to her. But her book, Alone Together, is very good
for listeners. We had Jonathan Haidt on the program. We talked about- He’s great. He’s also great. We talked about how social media is particularly
harmful to girls. But this larger thing about gender is also
problematic because we’re at a period of time today where so many things are shifting, norms
are shifting, or they’re being questioned. And I just feel like people are losing their
footing. And even to have a conversation like what
you’re describing, you have to stereotype boys. And there are a lot of people that are gonna
tell you that’s not okay. Oh, I know. I know. So this is a big problem. Well, this is why I want, my daughter is looking
for colleges, to go to University of Chicago because it’s like the last pretty safe space. That’s also, by the way, you’re a child of
immigrants. I find that we, immigrant children or immigrants
tend to be more normal when it comes to this stuff. Yeah. They’re less … Just in the same way that
Americans have a really screwed up relationship to food. Yes, oh my gosh, yes. It’s similar. It’s similar. It’s like … But the larger kind of thing- I just love that. I just love that you said that. That’s why they have these fad diets. It’s true because Americans have these fad
diets, and I think the research that I’ve read has a lot to do with the fact that there
is no food culture, kind of. Maybe in the South there’s more of a food
culture, but I don’t know how good it is because there’s an obesity epidemic in some of the
Southern States. Yeah. No, but I see what you’re getting at. I mean, I was not hot housed. I think that there’s two trends that are intersecting,
let’s say. It’s funny, I actually wrote a piece that
I thought was very sensible, but got a lot of hate mail DFT over a year ago on why supposedly
liberal college campuses are so illiberal in terms of curbing, conservative folks that
come and speak. I mean, okay, somebody doesn’t like it, you
write a letter, you speak out. Too bad. Grow up. Yeah, right. So anyway, that got a lot of hate mail, but
that trend of a certain kind of I would say illiberal liberalism coming to universities
is actually intersecting with the first generation of digital natives that are in this like multifaceted
kind of mirrored fun house world that is distorting and confusing and complicated and really,
I mean, if you go back in history, it’s not unprecedented. Neil Ferguson, the historian, I actually quote
his book, The Tower and the Square. He looks at disruptive technologies and their
effect on society. And he talked a little bit in his book about
the printing press and how, when you had Martin Luther, you had everybody being able to read
the Bible in their own language, you got a lot of great things eventually, but first
you had a 150 years of religious wars all over Europe. So we may be in that period right now. That’s an interesting analogy because like
the printing press, you were able to experience a dramatic shift in terms of your capacity
to experience or learn independent of other people. That’s true. You were reading a text and now I remember
why I brought up the episode we did, 27, Industrial Society and Its Future. By the way, for listeners, we also did an
episode, I think it was 66, called How The Internet Happened, where we talked about a
lot of the things that Rana mentioned, specifically with Google, but with all lots of other companies. But one of the things I mentioned in that
episode, Industrial Society and Its Future, was how you could be sitting in a railway
car and every single person in that car is experiencing a completely separate reality
than anyone else. The simple example is that everyone has their
own newspaper and each one of those newspapers is running its own advertisements. And there are no rules, and there has to be
no relationship between one or the other. And I think, we all sort of understand that
intellectually, I just don’t think, and then right back to Shoshana, who has written, I
think one of the best books of the current century, I have called it. When I read it, I was really blown away by
it. I don’t think that we understand really what
that means, how profound that is. Oh, it’s huge. It is the post-fact world. It is the social schizophrenia. Yeah. That’s a great way to put it. I mean, the fact that you and I can search
the same term and have different results depending on our patterns and our previous movements
online is stunning. I mean, it creates, just as you say, completely
different realities. I mean, sometimes I feel like a Luddite because
I still read three papers in print every day, as well as a number of things online, but
I’m pretty disturbed because I find even in comparison to some younger people that I know
in the business, I feel like I’m better informed because I’m just spending less time and that
I have a more balanced view. I mean, that’s one of the reasons I find myself
writing these stories that I think are very normal, but then get these kind of far right
or far left political reactions. We’re all being pushed to the extreme in this
schizophrenic world that you’re talking about. It’s fascinating. Actually, I recently wrote an article, there
was some studies that were done on Republicans and Democrats and their perceptions of each
other. And of course, as you would imagine, both
sides had more extreme views about the other side than was warranted. We’re in these filter bubbles. I live in Brooklyn. I can’t tell you how many dinner parties I
go to where people think that Republicans are just raving lunatics. And I’m like, I grew up in rural Indiana in
a cornfield. I know the Trump voter. They’re my best friend from high school. But what’s interesting is, so why is this? They dug down and they found that the patterns
really correlated with the amount, first of all of media consumption in general, but then
of course of social media and kind of non-traditional forms of media. Even the New York Times read online was more
polarizing than say an old style network news program that’s supposed to hit just to the
middle. So this dynamic is polarizing even what we
think of as conventional news sources. And the only solution really is to interact
with each other. They found that the people that have the least
bias are the ones that actually spend the most time with people from the other side. So it tended to be educated Republicans and
interestingly, uneducated Democrats. Elite Democrats were all sitting at their
dinner parties- That makes all the sense in the world. … in the park slope. And poor Republicans might be in talk radio
filter bubble. So talk about the need for empathy, real human
communication, and we’re losing it. Wow. I mean, I can’t tell you how much that last
point resonates. I’ve had a few falling outs where I’ve just
stopped talking to some people and they’re both … Again, to your point, illiberal liberalism. It’s not liberal. No, it’s not. It’s not. It’s not liberal. Liberal means that you are tolerant. That’s right. And they’re intolerant. That’s right. I’ve gone to a lot of these parties where
there’s like a litmus test. It’s not even a litmus test. They just assume that you’re going to agree
with their political points of view and if there’s any divergence, there’s like an awkward
moment, like, how do I handle this? You might know I’m a person. I have lots of different views and just cause
I don’t tow every line- 100%. … you know, it doesn’t make me. It’s so illiberal and it’s also incredibly
anti-intellectual, which is another thing to worry about. It is anti-intellectual. So two things I want to mention to listeners
again, we mentioned Jonathan Haidt, The Righteous Mind touches on all the things Rana is talking
about. Yes, great book. Absolutely. It helps explain so much about why people
can dislike others so much whose views diverge from their own. Accountability is something I want to talk
about though. Because you talked about it in terms of anti-intellectualism. I think this is a huge problem. I think you especially are in a unique place,
but both of us to some degree are in a unique position because we are forced to be accountable
as a result of our profession. We can’t just make stuff up. Actually, sure, I could make stuff up. I’m independent. I don’t work for the Financial Times. I could start making things up and if I can
monetize that audience, that works just fine. And lots of people actually do that. But actually I would be embarrassed. So accountability. People aren’t accountable. And one of the things that drives me nuts
and this I think is actually more of a phenomenon on the right. I don’t have any numbers to back it up, it’s
anecdotal, but I feel like the conspiracy theories, there’s a larger panoply of conspiracy
theories on the right and a willingness simply to indulge with them. I’ll give a great example of one in fact that
I think you have every right to believe in a conspiracy, but it’s a perfect example. So when Jeffrey Epstein ended up murdered,
because you write about this in the book, you write it by your own particular reaction. My reaction was, wow, this is super suspicious,
but I have no freaking idea what happened. I just heard something. It’s perfectly possible the guy killed himself. And I saw a bunch of people just immediately
going on social media and saying that he was murdered and everything else. And I’m like, maybe, but you have now lost
all credibility. You have also biased herself. You’re not positioning yourself to confirm
that bias. You’re not actually trying to get to the truth. This is a common problem. As the story goes on more and more, it looks
like increasingly like there’s some really bad shit happening. I don’t know if you saw the ABC anchor, Robbie,
what’s her name? She’s one of the anchors on good morning America. She was between takes, she was on set, her
mic was hot and she was talking about how they had a … She and her producers that
put together a story and they were sitting on it for three years, ABC would not run it. Oh, wow. They had Bill Clinton. They had Prince Andrew. Wow. Yeah. Now I think that she later found out that
… Well, she knows she was probably being recorded cause they record between takes. She probably looked at it, one of the producers
signed it off and put it out. And let her out. That is probably a way to push the story. But in any case, my point is even something
like Epstein, you guys shouldn’t be talking out of your ass. If you don’t know, don’t say anything. And I think that lack of accountability is
a problem because it allows for this flourishing of so many conspiracy theories, alternative
theories. But that brings us just to another problem,
which is actually a two-fold problem. One again, is the technology. It is that there is not one consensus hallucination
of what reality is. The Matrix, again, there is no real reality. Where do we get, is there a turtle shell at
the bottom of that? And the other point is that the official narrative,
the state has lost credibility. And Donald Trump’s a great example of this. Donald Trump pulled troops out of Syria. And what did the mainstream media do? Instead of focusing and saying yes, the way
that he did this was horrible, but we also have to admit our foreign policy is a disaster. The Bush administration was a colossal disaster. Obama’s foray into Libya was a disaster. We pushed all this stuff. It’s a really interesting question. You’re making me think. This is slightly off topic, but I think maybe
not. I was maybe a year ago getting ready to do
a hit on CNN, the latest iteration in the US China trade issues, and right before Trump
hadn’t given a press conference in a while. But he got off a plane, decided he was going
to talk. So boom, my hits cancel, but I’ve still got
my headset in, so I start listening. I hadn’t actually watched him on TV for a
long period of time. He spoke for about 20 minutes. And I was blown away, not by the factuality
of what he said, but the fact that he believed it himself. He was authentic to himself. And what I was thinking was, that’s powerful
to a viewer on television. And why does nobody write that? And so I wrote this article saying this guy
is a complete master at delivering messages and we need to pay attention to this and quit
dissing him for getting this or that wrong. Guess what? If you’re a television viewer, you’re watching
emotional energy, you’re watching body language, you’re watching confidence, you’re watching
the animal instincts. I got kind of slammed for writing that piece. Really? By commentors? Oh, a lot of liberal, yeah, commentors. I mean, I’m a card carrying Democrat, but- They were terrified that you might be speaking
the truth. Well, it’s just interesting. There’s something about the current environment
in which the lack of accountability, the polarization has somehow made it all the harder to tell
the truth or to be anywhere in the middle. Being in the middle is really, really difficult
these days, and it’s exactly what we need. So a lot of thoughts. I had Andrew Marantz on the show also recently. He came out with a book called Online Extremists,
Techno-Utopians, and the Hijacking of the American Conversation, anti-social. And during the episode, early on, very early
on, he said, “This is what Donald Trump has done to us as a country.” And I said to him, “Is that right? Has Donald Trump done this to us?” I think there is an echo chamber in sort of
leftist progressive media. Oh, yeah. That gives him too much credit. He’s a symptom of a change that was happening. It also doesn’t take accountability. Also, the media. This is another issue unfortunately. We have a lot of hams in the news. Yes, that’s true. You have a lot of people that are just narcissists
and people hate them. Understandably, they hate them. That’s very true actually. You know, it’s funny, I worried a little bit
about being a journalist, writing a book that was very critical of big tech. You were very critical in the book. I was, I was very critical. You were critical of also, you’ve named names,
you did not pull punches. I didn’t pull punches. Sandberg is one of them where you were very
hard on her. I think completely in pure fairness. Well, I think that, I got to say, I think
if she wasn’t a woman, she’d be taking a lot more heat. 100%. A lot more heat. And I hear that there’s a book coming out
in the spring about her. I wonder what it’s going to say. I mean- A critical book or- I hear there’s a critical book coming out
in the spring. Of course, Shoshana calls her the typhoid
Mary of surveillance capitalism. Oh, she’s like- It’s a great name. Actually, that’s the best analogy. I mean, I get so angry when I hear Zuckerberg,
but particularly Sandberg on the Hill month after month saying, “Okay, yes, we’re so sorry
about this latest mishap, but we couldn’t have possibly imagined.” What do you mean you couldn’t have imagined? You perfected the AdSense model at Google
and then you brought it and further tweaked it at Facebook. I mean, she’s ground zero with all of this
and anybody that was there nose. I mean, Roger McNamee writes about this in
his book, Zucked. Zucked. Yeah. With a big thumbs up. Great title. Yes, exactly. They are so disconnected. It’s like freakishly disconnected. I think you and your book mentioned Lloyd
Blankfein quote of we’re doing God’s work. Yeah. Well, I wasn’t sure if he was joking. Was he? He was totally joking. Was he joking? He was joking. They’re not joking. That’s the thing. There was something in the papers recently
about Sheryl standing up when somebody was attacking Mark or not attacking, but being
critical in the media about Mark and saying, “How can you do this to this kid?” That kid was, first of all, like put aside
the Freudian mommy dynamics there, but this kid is a billionaire that is running a public
company that is unaccountable because of a loophole from leftover from 1996. I mean, that’s insane. If I were a shareholder in that company, I
would say that’s a management, that’s a governance crisis. That’s the least of our worries. Let’s just try talking about Tesla or SoftBank
or something else. We will talk about those things. But just to drive this point home, your managing
editor, Gillian Tett, wrote a piece in The FT today where she talked about how Facebook
… Well, she talked about a number of things, but Facebook has basically gone back on their
promise to shepherd Social Science One, which should have been an academy industry project
that promise to follow academics from across the world and give them access to private
anonymized data from two billion Facebook users. But there was a quote that she made available
in that article, and it was from a Facebook official, and she said, “Making user data
available for research on a large scale in a way that protects individual privacy is
just incredibly hard, maybe impossible.” What bullshit. Of course it’s not impossible. And you guys promised that you were gonna
make this available and you couldn’t even do that. In other words, this brings us back to the
point, Janeway’s. And also we did another episode, to plug my
show, I’ve been plugging it all day. As you should. Yes. Who else is going to plug in if not me? That’s right. That’s right. I have my cousin from … I’m Greek, as we
said. All my family’s in Greece and I have a … My
youngest cousin likes his own Facebook posts and I said, I go, “What are you doing liking
your posts?” And he goes, “If I don’t like them, who will?” I love it. I love it. I’m very sympathetic to that. Yeah, yeah, yeah. Alexandros is his name. So that goes back to Safi Bahcall. We did an episode with Safi Bahcall on phase
transitions, and we covered Vannevar Bush and the relationship between the government,
the military, and academia. And we had a similar situation also with Bell
Labs, and Facebook’s not even willing to do that. Yeah. Right? Yeah. Well, I guess the question is why do we believe
anything at this point that Facebook- We don’t. And isn’t that the problem? Yeah, it’s 100%. I mean, this company has just a leadership
crisis of a kind that I don’t really know how they’re going to come out of it at this
point. I mean, definitely Zuck or Sheryl are going
to have to go, one if not both, and I think that that’s probably going to happen by 2020. I want to try and transition effectively here. Sure. There are a number of things I want to get
to. The next thing that I want to try and connect
here is to take it from what we’ve done so far, which is talk about big data as a primarily
private sector phenomenon and now attached to it the state component. So already we know, for example, Amazon has
strong ties to the surveillance state. Dwight D. Eisenhower was the first to talk
about the military industrial complex. It was actually originally the military industrial
congressional complex. It seems that we have something similar today
with the surveillance economy. Google also, Niantic Labs. Shoshana talks about this at length. Again, a book I highly recommend listeners
read. I also want to say this, I do highly recommend
Rana’s book. I put it right up at the top of my shelf along
with Shoshana’s book and a number of other, these other books- Oh, I’m honored to be in that spot. … that are doing a lot of very good work
in this area. Let’s talk a little bit about this. I don’t know much about who these players
are. I think it’s very scary that Amazon has so
many relationships that we don’t understand when Jeff Bezos owns the Washington Post. This kind of brings us, again, it kind of,
it’s a way of talking about the unprecedented. These companies have become so big and so
powerful so quickly and we were caught off guard. We don’t really realize. In your research, can you flesh this out for
me, what are we talking about here? How interconnected is the private sector of
these big tech companies with the government? Hugely interconnected. I mean, Eric Schmidt, the former CEO and Chairman
of Google is sitting on kind of semi-government board that is essentially creating digital
defense policy. I mean, he’s running that. Amazon is the main purveyor for government
procurement at this point. I mean, they do logistics for the CIA. They deliver documents. There’s a lot of deep ties, but let me pull
back for a minute, because there’s also a fascinating juxtaposition here. We spoke earlier about how in some ways the
biggest tech platform firms are the apex of the multinational corporation. The neoliberal capital data can go anywhere. They’re completely supranational. I mean, if you think about it, Google is still
operating a research center in China. Now, would Raytheon be able to do that? I don’t think so, but Google with its AI division
is arguably more important for national security than any kind of old line maker of military
equipment. Now, I don’t know completely what the answers
to these questions should be, but I can tell you one thing. This defense, the big tech companies from
Facebook to Google have given that we can’t be touched, we can’t be regulated, we can’t
be liable for any of the same kind of regulation as other companies because we’re your national
champions and the battle against China is beyond nationalistic. It’s so cynical. These are companies- That’s Zuckerberg’s like go-to. That’s Zuck … I mean, one of the best moments- If you regulate us, it’s going to put our
national security at risk. China is going to take over. These companies would love to be in China. I’ll tell you, the only reason Amazon is now
playing the China card is that it can’t get in because of Alibaba. So they’ve decided to go the other direction
and say, “We want to own everything to do with government procurement.” What I’m concerned about is two things. First of all, it’s a false narrative that
regulation will somehow penalize America in the innovation battle with any big country
from China to the European Union. Our advantage has always been decentralization. Our advantage has been allowing many, many
different companies to grow and flourish. Unfortunately, what the statistics are showing
is that for the last 20 years, as big tech has gotten bigger and bigger and bigger, the
number of innovators has gone down by a number of measures, entrepreneurial zeal per capita,
the Kauffman Foundation has done really great research on this, but basically there’s black
holes now because these firms will come in and buy up anybody that they think is going
to compete with them. There’s a lot of research to show, Stanford
research shows that innovation tends to slow down dramatically after a company goes public
for obvious reasons. Smaller companies- Look at Apple. Look at Apple. Look at Apple. It hasn’t had- It’s a perfect example. Totally. What do they keep putting out? Higher resolutions screens, fancier watches. Credit cards. It’s a fashion company. Exactly. Or a financial company. It’s a consumer electronics company. It’s not doing anything interesting anymore. So this is a false narrative that the Schmidt’s
and Sandberg’s and Zuckerberg’s are putting forward. That’s point number one. Point number two is that we are headed, like
it or not, to a splinternet. I think that the US, Europe and China and
some of the emerging markets that China is going to pull into its orbit via the one belt,
one road infrastructure program, I think we are going in fundamentally different directions
in terms of how the digital economy is going to be regulated. Now, if we were smart on this, as in all things
to do with trade, we would be really teaming up with Europe right now to say, “All right,
we are a liberal democracy, I hope still, let’s talk to other people with this system
and find out what the rules of the road should be. Let’s come to some standards that we can both
live with.” Instead, we are embroiled in this false narrative
put forward by the companies themselves, who by the way, are now the biggest lobbying group
in Washington. They have bought out so many regulators, so
many academics who write about this topic- Absolutely. … who do the amicus briefs that are being
looked at by the courts in small print. You find out that they’re Google consultants. Absolutely. Unbelievable. Absolutely. We’ve talked about this as well on the program. We’ve done a number of episodes on China. There’s also something else, which is, there’s
a historical, this again is part of the problem people don’t read. I’m 100% with you. People should stay the hell away from news
and try and read it only- Yes. … in a controlled manner. Yes. And not just like read whatever comes on their
social media feed 100%. Nassim Taleb, I don’t know if you’ve ever
had on. No, I would love to have the Nassim. I’ve actually reached out to him. He’s a difficult person to get ahold of. He is. He’s not on email very much too. He walks the walk. I know. I’ve been trying to get him on for years. Well, I interviewed him once way back when,
when his last book was coming out and he told me he didn’t do it any high speed data, any
high-speed media at all, that he read basically only books, and he had a stack of amazing
books on his [inaudible 01:01:11]. I actually have a thought about that as well,
quick interjection on it, and I don’t want to get lost on the point, but I actually think
that physical books will actually command a high resale value in the future because
I think people, or maybe not a high resale value, but they will come back into demand
because I think- Interesting. … that people want to wait to read without
having their thoughts surveilled. Oh God, yes. I think that’ll be a powerful thing. I wanted to kind of make a point before I
move us to the overtime Rana, and a couple of points. One is … Both of them steeped in history. One is that we’ve seen this before. We’ve seen that when a technology becomes
mature, there is this phase of consolidation, and we saw the regulation of heavy industry
and the banking sector and everything else in the late 1800s, early 1900s. Certainly the banking regulation didn’t go
as well as we would have liked. I think it was done much better after World
War II, but regardless, something similar has to happen again and will happen. I’ll also say something else, which touches
on your point about China and these selfish companies that operate for their own private
benefit. Fine, what’s the way they’ve been built. That’s the culture. But this idea that. I should be more afraid of Xi Jinping than
of Mark Zuckerberg. Right. And it also, if you’ve read history, you know
IG Farben, you know about IBM, IBM’s role in supporting the Nazi killing machine with
their punch cards, the DuPont family, the Rockefellers, the big banks supported Mussolini. They supported Francoist Spain. They supported the Nazis. They funded them all up until the trading
with the Enemy Act. They continued to have relationships, I think
IBM had relationships right through the end of the war with the Nazis. This is such an important point. And you know what, you’re calling to mind
is the fact that Facebook hired this nefarious PR firm to go after George Soros. Mark Zuckerberg and Sheryl Sandberg are Jewish. This firm ended up using antisemitism to try
and smear Soros. I mean, there is no reason why we should think
a large multinational corporation run by unelected people is any better than any other kind of
large state monopoly, namely China. I mean, I actually think of big tech and China
as being kind of similar in some ways. Well, I mean, again, to bring it back to the
Nazis. The Nazi regime, the fascist regime, and Mussolini’s
Italy also, of course, Mussolini pioneered this. The relationship between the public and private
sectors was instrumental in enabling totalitarianism. To bring it back to George Soros, one of the
other things that you quoted in his speech from Davos, he said that he feared, “alliances
between authoritarian states and these large data rich it monopolies that would bring together
nascent systems of corporate surveillance and an already developed system of state sponsored
surveillance.” Which is one of the things I want to talk
to you in the overtime. I also do want to talk to you about, you have
such a deep knowledge of financial markets. You’ve covered it for years and years. I want to talk about the macro picture, touch
on it to the extent that we can, and I also do want to talk about SoftBank. AliBaba, WeWork, Uber. Again, try to mix it in as much as we can. For regular listeners, you know that the drill. If you’re new to the show or you don’t support
us yet, you can head over to Patreon.com/HiddenForces and subscribe to our audio file, autodidact
or super nerd tiers and get access to this week’s overtime where I’m going to continue
our conversation with Rana, as well as access to a transcript of this week’s episode, as
well as to my beautiful multi-page 12-page rundown today full of pictures, including
a Frankenstein and Mary Shelley’s- Oh, that’s so great. I love that we can download all that. Yeah. It’s available to our subscribers and those
who support us on Patreon. Rana, stick around, we’re gonna continue this
on the overtime. Awesome. Today’s episode of Hidden Forces was recorded
at Creative Media Design Studio in New York city. For more information about this week’s episode,
or if you want easy access to related programming, visit our website at HiddenForces.io, and
subscribe to our free email list. If you want access to overtime segments, episode
transcripts, and show rundowns full of links and detailed information related to each and
every episode, check out our premium subscription available through the Hidden Forces website
or through our Patreon page at Patreon.com/HiddenForces. Today’s episode was produced by me and edited
by Stylianos Nicolaou. For more episodes, you can check out our website
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and Instagram @HiddenForcesPod, or send me an email at [email protected] As always, thanks for listening. We’ll see you next week.

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7 thoughts on “Rana Foroohar | How Big Tech and Finance Betrayed Us and What We Can Do About It

  1. Make money itself accountable. Free Money is the root of all evil. End the fiat money system and these people will have nothing to leverage!

  2. We would be better off returning to the unfettered capitalism of the 19th century. Read The Progressive Era by Murray Rothbard and Illiberal Reformers by Thomas Leonard. Progressive regulation and clamoring for more Marxist egalitarianism is precisely the problem. Society must adapt to markets. Markets cannot be made to conform to the whims of social engineers. Markets are the touchstone of hard reality.

  3. "first generation is more normal" sounds like these two are out of touch with main stream society, so how can they fully comment on society and be credited to do so?

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