Who Owns the Future?

June 12, 2014

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Jaron Lanier. 2013. Who Owns the Future? New York: Simon & Schuster.

Jaron Lanier is a heavyweight in computer science, who among other things had a lot to do with the creation and development of virtual reality. He is also an artist and musician, and a humanistic thinker who has thought deeply about the future of the information economy. I always find it hopeful when someone with impeccable technical credentials can avoid reducing everything to computation and elevating technology over people. Lanier is clearly fighting for human value in general, and human economic value in particular. The purpose of his book is to warn us that human value is being systematically undermined in the emerging information economy, and to consider what might be done about it.

I found Lanier’s writing brilliant but a little exasperating. He writes something like he thinks, no doubt, in short bursts of creativity that come at the problem from many different directions. He has thirty-two short chapters and eight “interludes,” many of which left me intrigued but wishing for more thorough explanation. To try and lay out his argument logically, I will have to pull it together from here and there rather than covering the book from start to finish. Still, you have to love a guy who can write, “Drawing the line between what we forfeit to calculation and what we reserve for the heroics of free will is the story of our time,” and, “The spiritual challenge will remain of not losing touch with that core of experience, that little something that doesn’t fit into the aspects of reality that can be digitized,” just to quote two of his insights.

The information revolution promises to be a great leap forward in human productivity. Why is it that the economic benefits are not more obvious then, at least to the majority of people in the most developed countries? Why are a relatively small number of people making so much money while the middle class is slowly shrinking? Lanier thinks that something has gone wrong:

PCs enabled millions of people to run their own affairs. The PC strengthened the middle class. Tablets are instead optimized for delivering entertainment, but the real problem is that you can’t use them without ceding information superiority to someone else.

The information economy has taken a turn for the worse as people have come to rely on a relatively small number of companies that owe their success to the collection of vast amounts of information. Lanier believes that we have made a bad bargain with these companies, giving them too much information and not getting enough in return. We are operating partly on the idea that information should be freely shared, and partly on the idea that information is economic power. The result is often that information freely shared by the many is gathered and used for profit by the few. He believes that an information economy run that way is ultimately unsustainable, since it will eventually destroy more income-generating activity than it creates.

Siren Servers

Lanier uses the term “Siren Server” to refer to “an elite computer, or coordinated collection of computers, on a network…Siren Servers gather data from the network, often without having to pay for it. The data is analyzed using the most powerful available computers, run by the very best available technical people. The results of the analysis are kept secret, but are used to manipulate the rest of the world to advantage.” The name, of course, is a reference to the mythological sirens who lured men to their death.

The information advantage can take many forms. More information helps an insurance company reduce risk by insuring only the healthy. More information helps Amazon automatically monitor book sales to make sure it is never undersold. More information helps Walmart calculate the lowest price it can get away with charging a supplier. More information helps an advertiser present just the right ad in the right place to induce you to click on it. Much of this may seem benign and even economically efficient. Customers get low prices and the free search engines to find them. But lower risk for those with the most information translates into higher risk for someone else, such as Walmart’s or Amazon’s suppliers. Instead of rewarding companies for taking risks, the information economy enables companies to earn the greatest rewards by using information to export risk to others.

Siren Servers lure customers with “rewarding network effects,” virtuous feedback cycles that make a company’s network more valuable as more people use it. The more people read Amazon books on their Kindle, the more publishers will put out Kindle editions. The more people using a matchmaking service, the better the chances of meeting someone you like, whether the matching algorithms actually work very well or not. But the most successful Siren Servers also hold onto their customers with punishing network effects that make it hard to leave, such as lost access to data. You don’t really own a copy of the Kindle book you “bought,” just the right to access it through a particular company.

Who will make a living?

The biggest threat from the information economy is that fewer people will be able to make a middle-class living. Lanier is by no means a Luddite who sees only the destructive impact of new technologies on work. He acknowledges that “up until about the turn of this century we didn’t need to worry about technological advancement devaluing people, because new technologies always created new kinds of jobs even as old ones were destroyed.” He is essentially an economic optimist who believes in economic growth through the creation of new wants and new value: “To lose trust in the basic inception of wealth is to lose trust in the idea of human improvement. If all the value that can be already is, then market dynamics can only be about churn, conflict, and accumulation. Static or contracting economies make people cruel and shortsighted.”

However, as the information economy has played out so far, the combination of free-flowing information and profitable consolidation of information by Siren Servers is threatening many middle-class jobs. A multitude of news,  books and music are available online, but newspapers are going bankrupt, bookstores are closing, and fewer people can make a living as journalists or musicians. And that’s only the beginning. Lanier sees online instruction as a real threat to the jobs of university professors. Publishing books online will become ever easier, but getting paid for it will be harder. Even health care workers could lose jobs to caregiving robots. “Eventually most productivity probably will become software-mediated.”

In Lanier’s view, the problem is not that humans have less to contribute, but that the human contribution is not being properly accounted for and compensated. “The most crucial quality of our response to very high- functioning machines, artificial intelligences and the like, is how we conceive of the things that the machines can’t do, and whether those tasks are considered real jobs for people or not.”

What people do

Lanier insists that smart technology depends ultimately on people. He says that “algorithms are only a repackaging of human effort.” The decisions of a caregiving robot will have to be based on the inputs of many humans making decisions in real situations. “The supposedly artificially intelligent result can be understood as a mash-up of what real people did before.” As smarter technologies increase our ability to implement our ideas, the ideas themselves will become more important than ever. Getting people to submit to surveillance and give up information for free will become more and more a matter of stealing human labor, a new form of economic exploitation.

The real problem is not human obsolescence, but a misguided philosophy that undervalues the human contribution. Or to be more precise, the contributions of most ordinary people. The same technological entrepreneurs who envision obsolescence for the masses regard themselves as Nietzschean heroes making their mark on the universe by using information collected from others. At times, Lanier refers to this as a new religion, a faith in technology and its wizards.

To put the argument very concisely, the information economy requires a more consistent association between information and economic value. Everyone must be able to receive compensation for the information they provide, and large companies must pay for the information from which they profit.

The more advanced technology becomes, the more all activity becomes mediated by information tools. Therefore, as our economy turns more fully into an information economy, it will only grow if more information is monetized, instead of less. That’s not what we’re doing….

Even the most successful players of the game are gradually undermining the core of their own wealth. Capitalism only works if there are enough successful people to be the customers. A market system can only be sustainable when the accounting is thorough enough to reflect where value comes from, which, I’ll demonstrate, is another way of saying that an information age middle class must come into being.

Continued