Category Archives: Technology and innovation

A Grassroots Win: FCC Approves Net Neutrality

Thanks to those Naked Capitalism readers who supported, through your petition signatures, e-mails, calls, and donations, the push to preserve net neutrality and keep the major telecom and cable incumbents from giving preferential access to content providers with the financial heft to pay for it. Over time, that practice would be certain to drive smaller sites like ours into a death spiral of lower attractiveness, lower visibility, and lower traffic.

Read more...

Wolf Richter: In Search of Cheap Labor in Tech – Behind the H1-B Visa Scenes

his post focuses on how the procedures in the H1-B visa process that are meant to protect workers from unfair competition from foreign workers and contractors are a joke. And this is one of the reasons that the calls by disconnected Beltway pundits and technocrats for American students to get more technically oriented education, most of all in STEM fields, is hopelessly misguided. Companies are more and more refusing to supply much if anything in the way of entry-level jobs, sending yeoman’s work in former white collar professions, including accounting and the law, to outsources in India. And the fix of having more specialized training is just as unrealistic. The more specialized the training, the more at risk you are that those skills will prove to be useless. That is why so many mid-career professionals fall far when they lose their perch, since if they can’t use the narrow expertise that they’ve accumulated, they have to fall back on their generalist skills, which means low-level jobs like call center work, retail, or if they are lucky, a position like an office manager in a small business.

Read more...

Is Power8, Sponsor of Everton FC, Fulham FC and RCD Espanyol, a Giant Ponzi?

Yves here. Richard Smith is on the trail of what looks to be his biggest international scam find ever, orders of magnitude larger than the usual below the radar single to low double digit million dollar/pound/euro operation that he has ferreted out in the past. And mind you, even though he focuses on the dubious looking inter-corporate relationships and the often evident lack of normal investors protections and business substance, these companies sell hope and glamour to typically credulous retail investors who lose their money and have no recourse.

Read more...

How Superstar Companies Like Apple Are Killing America’s High-Tech Future

Few would argue that America’s fortunes rise and fall on its ability to generate technological innovations — to put bold ideas to work and then bring them to market. William Lazonick, professor of economics at the University of Massachusetts Lowell, and Matt Hopkins, research associate at the Academic-Industry Research Network, have investigated how the technology knowledge base gets created, what has gone wrong in America’s approach to innovation, and why the truth about who invests in the process is poorly understood. In the interview that follows, Lazonick shares findings from two recent papers that are part of the Institute for New Economic Thinking’s project on the “Political Economy of Distribution.” He explains why successful companies like Apple need to make fundamental changes to the way they allocate resources and stop throwing away America’s most valuable asset for future innovation — you.

Read more...

Suit on Animator Wage Suppression Shows Another Face of How Capital Squeezes Labor

Mark Ames reports on the latest revelations in a major anti-trust case against Silicon Valley giants including Disney, Sony, Dreamworks, Lucasfilm, and Pixar. For tech titans, enough is apparently never enough.

The earlier chapters of this sorry saga exposed a long-standing scheme by which major tech companies including Apple, Google, Adobe, Intuit, Intel, Lucasfilm and Pixar colluded to suppress wages of an alleged one million workers. The collusion was agreed at the CEO level of all the participants and memorialized through written agreements.

A related private suit was filed last September by animator against nine movie industry heavyweights including Walt Disney Animation, Dreamworks Animation, Sony Pictures, LucasFilm and Pixar. It alleged similar conduct to the bigger Silicon Valley wage-suppression suit. Among other things, the companies not just compared pay levels but agreed to fix them, and also signed agreements not to recruit from each other.

An amended complaint in the animator suit added two studios to the complaint and far more important, exposed that the wage-fixing scheme was far longer standing that previously thought. K

Read more...

Wolf Richter: Signs That the Startup Bubble is Totally Maxed Out

Yves here. Wolf’s longer original headline to this post focused on how gobsmacked he was to get glossy mail pieces to promote supposedly hot Silicon Valley startups. Apparently, the deemed-to-be-transgressive communications medium (by West Coast standards) was a way to cut through the new venture clutter. But what I found more surprising was how obviously lame these ideas were, yet they’ve all already gotten multiple rounds of funding and have eight figure investments so far.

Read more...

Government, Not the Private Sector, Leads Innovation

This video, in which economist Mariana Mazzucato discusses her book The Entrepreneurial State, explains how most of what you think you know about innovation is wrong. Innovation is not led by the private sector; it lacks the long term horizons and risk appetite to do so. Instead, the most innovative countries and regions have the state playing a very active role, not just in funding basic research or making sure markets work properly, as in limiting anti-competitive practices that can stymie new entrants. Instead, the state plays an active role along the entire value chain. One result of the wide-spread misperception that the private sectors deserves most of the credit is that businesses are able to skim a disproportionate level of the returns for themselves.

Read more...

“The Tragedy of Electronic Medical Records”

Yves here. We’ve written about the pitfalls of electronic health records in the past. One of the surprising reactions is the “dazzled by technology” response of some readers. While there are problems with relying on paper-based records, and electronic records could in fact remedy many of them, a large swathe of the public seems unwilling to hear that what is good in theory may not turn out well in practice.

The sorry fact is that electronic health records, which in theory should reduce errors and allow for more consistent delivery of medical services, were instead designed only with patient billing and control over doctors in mind. As a result, they are if anything worsening medical outcomes. One indicator: as we reported, the latest ECRI Institute puts health care information technology as the top risk in its 2014 Patient Safety Concerns for Large Health Care Organizations report. Note that this ranking is based on the collection and analysis of over 300,000 events since 2009.

This is another example of crapification. Electronic medical records have been implemented, with apparent success, in other economics. For instance, when I lived in Australia from 2002 to 2004, it was normal for doctors to make use of them during patient visits, making entries into the system, and I never got the impression they found it onerous. Here, in New York City, I still see doctors making considerable use of paper records. As the article indicates below, the reason is the US systems are costly, lower productivity, and make doctors less likely to review patient information.

Read more...

Tech Underbelly: Indentured Servitude and Bonded Labor in the US

A labor collusion pact with the aim of suppressing pay levels among Apple, Google, Microsoft, Pixar, and others, demonstrated that the idea that Silicon Valley plays fairly is an illusion. But even more unsavory abuses occur further down the food chain. H1-B visa workers, who are generally held in low esteem in the US since they compete with Americans, take a risk when they sign up with labor brokers, even seemingly legitimate ones like Tata Consultancy, part of the giant Tata Group in India.

As the NBC video below, part of a joint investigation with the Center for Investigative Reporting, explains, the most abusive recruiters are body shops, who abuse the H1-B program by bringing in technology graduates when the firm in fact has no job lined up. The Indian immigrants are hostage, kept in guest houses where they are told not to go outside until they find work.

Read more...

Adair Turner: The Consequences of Money-Manager Capitalism

Yves here. This is a terrific interview with Lord Adair Turner, former head of the FSA. Most of it focuses on the things missed in contemporary economics, particularly macroeconomics, and how some disciplinary “back to the future” would be desirable. A major topic of discussion is how wealth is becoming as concentrated as it was in the 18th century, and the driver then and now was the disproportionately large role real estate has come to play. Then, it was income-producing agricultural land. Now it is urban property, bid up by domestic and international elites who want to live in particularly prized cities. Turner points out the irony that access to cheap finance for housing, meant to help middle and lower income buyers, has instead contributed to rising wealth inequality. He also describes how the ability of banks and financial markets to supply virtually unlimited amounts of credit, against a limited stock of particularly sought-after locations, has the potential to create tulip-mania type results.

Perhaps due to time constraints, Turner didn’t venture into the views of classical economists, that profiting from land, which they derided as rentier capitalism, was economically unproductive. As Michael Hudson has stressed, they urged heavy taxation of land as the remedy.

Read more...

Tom Englehardt Interviews Laura Poitras on Snowden and the Total Information Capture Approach to Surveillance

Yves here. This interview with Laura Poitras is a reminder of how the world has, and more important, hasn’t changed since the explosive revelations made by Edward Snowden less than a year and a half ago. Even though his disclosures produced a great uproar, with demands in the US, UK, and Europe for explanations and […]

Read more...

Evil Feedly and Digg: “Social Logins” as Symptoms of Creeping Surveillance State

Your humble blogger is a beached whale as a result of the steady march of police state practices on the Internet. And to calibrate how heinous the underlying situation is, Lambert, who has 20 years of experience as a computer professional, calls my current mess the technology equivalent of being shoved into a minefield without any signs. And as you’ll see below, I’ve already stepped on one mine.

Read more...