Four Industries Big Tech Has Ruined

Lambert here: The author forgot to include the Internet.

By Keith A. Spencer, a cultural critic, essayist, and editor at Cross-posted from Alternet.

The word “innovation” has become synonymous with Silicon Valley to the point of absurdity. Indeed, the tech industry’s entrepreneurs and “thoughtfluencers” throw it around as casually as a dodgeball in a middle-school P.E. class; what it really means is perpetually unclear and purposefully hazy. It is vague enough to be suitable in nearly any situation where a new product, service or “thing” is advertised as superior to the old — never mind if the so-called “old” thing has some distinct advantages, or if the new thing’s superiority is solely that it makes more money than the old thing, or if there are other old things that are actually superior yet which won’t make anyone rich. (Consider Apple removing the headphone jack from its new phones to be Exhibit A.)

That summary may sound flippant, but it is a good explication of the path of the tech industry over the past two decades: Some venture capital–backed entrepreneurs jackhammer their way into a new industry, “tech”-ify it in some way, undermine the competition and declare their new way superior once the old is bankrupted. Thus, rather than confine themselves to operating systems and PC software like they did in the 1980s and 1990s, the tech industry has figured out that the real money lies in being a middleman. By that I mean serving as the in-between point for, say, web traffic to newspapers and magazines (like this one); or being the go-between for taxi services, coordinating drivers and passengers through apps. In both of these examples, the original product isn’t that different from the pre-tech world: a taxi ride, in the latter case, a news article in the former. The difference is that a tech behemoth takes a cut of the transaction. And also in many cases, the labor — the people making and producing and doing the things the tech industry takes a slice from — is more precarious, less well-remunerated, and less safe than it was in the pre-tech era.

Looking at it this way, the tech industry doesn’t really seem innovative at all. Or rather, its sole innovation seems to be exploiting workers with more cruelty, and positioning itself in the middle of more transactions. Granted, there are certain services that have become more convenientbecause of apps and smartphones — but there is no reason that convenience must come at the high cost that it does, besides the tech industry’s insatiable lust for profit. Here are but a few examples of how our livelihoods and our societies have been worsened by Silicon Valley as it sinks its talons into new industries.

Public transit was never great in the United States, with the exception of a few big cities like New York, and thus private taxi services were around to supplement. Being a taxi driver was once a much-vaunted job, so much so that a taxi medallion was perceived of as a ticket to the middle class.

Then came Uber and Lyft, who flooded the market for private transit and undercut the taxi industry by de-skilling the industry and paying their workers far, far less. Driving a taxi is no longer a middle class job; once-valuable taxi medallions have become burdens for some taxi drivers. The outlook for career taxi drivers is so dismal that an alarming number of taxi drivers have been committing suicide.

Meanwhile, because of the precarious nature of Lyft and Uber jobs, those drivers are frequently not vetted or under-vetted — resulting in significant safety concerns for passengers. And unlike a taxi back in the old days, being a rideshare driver isn’t a ticket to the middle-class at all: a recent study of such employees revealed that most contractors use these kinds of jobs not as their sole source of income, but as supplementary jobs to make ends meet.

Richard D. Wolff, an economics professor at the New School in New York City, describes gig economy companies like Uber as “winning the competition” by taking shortcuts that “frequently endanger the public.” Regulatory agencies for taxis were created in most countries, Wolff says, because taxi companies were historically unsafe. “Taxi companies are required now to have insurance, training for drivers, well-inspected cars, and other safeguards to protect the public. The cost of riding in a taxi reflects those safeguards,” Wolff said, adding:

…there’s always the incentive for somebody to come in and operate, once again, inadequately insured, inadequately maintained, inadequately vetted drivers — to come in with a cheaper cab service [that is] unregulated by the taxi commission. That’s all that Uber and Lyft [are]… they undercut the old arrangement and offer cheaper and more competitive services by cutting corners.

Home Appliances

Lightbulbs have existed for around 140 years, and home refrigerators for about 100. In that span, they haven’t changed too much, besides getting more energy-efficient, mostly because they haven’t really needed to: we need to keep food cold, and we need light. The appliances that do these things don’t really need to do much else.

Now, tech companies are putting wi-fi and Bluetooth chips in all kinds of things that didn’t used to be internet-connected. They call it the “smart home,” and while the word is open-ended, the common thread with smart home devices is that they can generally be monitored via an app.

The smart home is sold to us as next-gen, a new advance on traditional appliances. But these devices tend to waste more of our time, and have both privacy and safety risks that regular appliances lack. You can’t just put a wi-fi chip in a mundane household object like a lightbulb or a smoke detector without doing something to fix the security holes that emerge with having another device connected 24/7 to the web. But that is exactly what happened: a tremendous number of smart home devices have been hacked and turned into digital soldiers forming massive botnets that can be called up by hackers to engage in distributed denial of service attacks. An Atlantic reporter did an experiment that found that their fake smart home device attracted hundreds of hacking attempts in a matter of hours after being plugged in.

Part of the reason that companies are so eager to market the smart home to us is because these devices can be used to build digital dossiers on customers to market things to them. A refrigerator without an internet connection can’t generate any data about a consumer, but a fridge with one can regularly report back all kinds of data on the person using it — data that can be monetized and sold.

Even barring the hacking issue or the privacy issue, smart home devices aren’t necessarily an innovation because their whole function seems to be to create more work for us and turn us into (essentially) managers. There is a certain managerial mindset that trickles down from the device’s creators (who are, at some level, managers themselves) to consumers — as if I wanted to spend my days and nights studying graphs and charts of my fridge’s power consumption, or do a data analysis on my Roomba’s path. That sounds horrible.

Additionally, the difficulty of setting up many of these devices in the first place can be mind-numbing for those lacking technical savvy; notably, drastically increasing the number of wi-fi enabled devices in one’s house often means that you need to invest in new internet equipment, either routers or faster internet service or both. Not everyone is an engineer, nor wants to be, but smart home devices often compel us to be — and this increasingly complex domain of appliances is supposed to be superior to the simplicity of flicking a lightswitch on the wall.

And speaking of turning us into managers…


Steve Jobs’ greatest genius was not in engineering, but in marketing. He understood that late capitalism no longer fulfill needs, but create them; inevitably, Apple became the premier exporter of desire, master marketers who compel us lust over their clean-looking products and obsess over them once we own them.

To that end, there was never really anything wrong with fitness; it wasn’t an industry that needed to be “disrupted,” to use Silicon Valley’s favorite dystopian verb. But if you slap monitoring devices on your shoes, your watch, your armband, and your water bottle, suddenly you have a huge cache of data points about your body and activity that you can analyze later. Apple and a slew of other apps even help you monitor your ovulation cycle, and some analyze and monetize that intimate customer data. This can create some funny situations when those devices stop being updated or get corrupted; Nike was widely mocked when a $350 pair of “smart” sneakers were ruined by a faulty update. The idea of being able to hack into someone’s shoes and ruin them is not exactly where I thought the future was headed.

I suppose if you were dreaming of being a statistician collecting data on your body constantly might seem kind of interesting, but if you aren’t, it’s just a new source of busyness in your life. Again, building devices to quantize as much fitness data as possible wasn’t an example of capitalism fulfilling consumer desire — no one, save a few data scientists, ever said, “I want to turn my leisure activities and exercise regime into spreadsheets” — but the tech industry has been very effective at making us desire just that.

This obsession with quantifying our existence is known in academic circles as “computationalism.” Previously I interviewed Professor David Golumbia, who has written about this extensively, and who describes computationalism as “the philosophical idea that the brain is a computer” as well as “a broader worldview according to which people or society are seen as computers, or that we might be living inside of a simulation.”

“There is a small group of people who become obsessed with quantification,” Golumbia told me. “Not just about exercise, but like, about intimate details of their life — how much time spent with one’s kids, how many orgasms you have — most people aren’t like that; they do counting for a while [and] then they get tired of counting. The counting part seems oppressive.”

Convenience Stores

In many of the above cases, Silicon Valley has torn into an industry and taken good jobs and turned them into bad jobs. In the case of the corner store, Silicon Valley’s aim seems to be to eliminate the human component altogether.

There are a few different business spins on how this might be done. The most infamous is Bodega (now known as Stockwell), which we reported on in 2017:

Two former Google employees are hoping to take over street corners, dorm rooms, gyms, or anywhere convenient in urban residential neighborhoods, with their reinvention of the vending machine.

Paul McDonald and Ashwath Rajan launched a new startup called “Bodega,” with the goal of making convenient stores all but a thing of the past. “Bodega sets up five-foot-wide pantry boxes filled with non-perishable items you might pick up at a convenience store,” Fast Company reported. “An app will allow you to unlock the box and cameras powered with computer vision will register what you’ve picked up, automatically charging your credit card.”

Employees? They would become things of the past as well, because no one will work the bodegas, and all transactions will be electronic.

Unsurprisingly given that the friendly neighborhood corner marketplace is something that has existed for centuries across most cultures, seeing a group of out-of-touch tech bros working hard to destroy that touched a collective nerve. In the wake of internet outrage, the two of them apologized and then later rebranded.

Stockwell/Bodega is far from the only example of Silicon Valley’s crusade against human interaction. There’s a company that is trying to make robots that make, serve and sell smoothies, which we reported on ruefully last year. There are multiple companies, including CafeX, making robot baristas. Amazon is creating Amazon Go stores that lack cashiers, and rather rely on cameras to track what people pick up and then bill them accordingly.

The thing is, baristas and cashiers aren’t things that we are all dying to get rid of; this isn’t a comparable situation to the horse-and-buggy days, where cars felt like a serious improvement on using beasts of burden for transit. Silicon Valley is only trying to put baristas and cashiers out of business because human labor costs money; the difference between a $4 coffee from a robot and a $4 coffee from a human is that there are no labor costs in the former purchase, something that makes Silicon Valley go googly-eyed with dollar signs. The tech industry’s vision of the future is of a world with less human interaction, less conversation, less humanity; and more surveillance and more monetization of our buying habits. No one wants this, but it’s being forced upon us.

This entry was posted in Guest Post, Social values, Surveillance state, The destruction of the middle class on by .

About Lambert Strether

Readers, I have had a correspondent characterize my views as realistic cynical. Let me briefly explain them. I believe in universal programs that provide concrete material benefits, especially to the working class. Medicare for All is the prime example, but tuition-free college and a Post Office Bank also fall under this heading. So do a Jobs Guarantee and a Debt Jubilee. Clearly, neither liberal Democrats nor conservative Republicans can deliver on such programs, because the two are different flavors of neoliberalism (“Because markets”). I don’t much care about the “ism” that delivers the benefits, although whichever one does have to put common humanity first, as opposed to markets. Could be a second FDR saving capitalism, democratic socialism leashing and collaring it, or communism razing it. I don’t much care, as long as the benefits are delivered. To me, the key issue — and this is why Medicare for All is always first with me — is the tens of thousands of excess “deaths from despair,” as described by the Case-Deaton study, and other recent studies. That enormous body count makes Medicare for All, at the very least, a moral and strategic imperative. And that level of suffering and organic damage makes the concerns of identity politics — even the worthy fight to help the refugees Bush, Obama, and Clinton’s wars created — bright shiny objects by comparison. Hence my frustration with the news flow — currently in my view the swirling intersection of two, separate Shock Doctrine campaigns, one by the Administration, and the other by out-of-power liberals and their allies in the State and in the press — a news flow that constantly forces me to focus on matters that I regard as of secondary importance to the excess deaths. What kind of political economy is it that halts or even reverses the increases in life expectancy that civilized societies have achieved? I am also very hopeful that the continuing destruction of both party establishments will open the space for voices supporting programs similar to those I have listed; let’s call such voices “the left.” Volatility creates opportunity, especially if the Democrat establishment, which puts markets first and opposes all such programs, isn’t allowed to get back into the saddle. Eyes on the prize! I love the tactical level, and secretly love even the horse race, since I’ve been blogging about it daily for fourteen years, but everything I write has this perspective at the back of it.


  1. taunger

    Good article, but for many the ability to track workouts has been a pre-tech desire. Good training involves careful progression, which requires records. Weight lifters and runners have long kept journals. The tech can make it easier.

    1. ZacP

      I prefer a paper journal for my strength training. A phone is an inherent distraction and tangibly impacts my performance when I have to fiddle with it in between every set.

      Separately, much of the data tracked by fitness apps is at best trivial and at worst counterproductive.

    2. Carey

      And about your “private” journal being sent elsewhere to be scrutinized, commoditized, and monetized? All for your own good, of course. ;)

      no thanks

    3. David Mills

      As paranoid as I can be sometimes, I swear by my Fitbit. I’ve lost over 9kg and cut my body fat by 7%. It helps create a competitive stress for me and quantify my progress.

  2. Heraclitus

    I find it interesting that the guys from Google named their convenience store enterprise Bodega. Through this cross cultural name, they figured they got political correctness points, from criticism. Fortunately, they were criticized anyway.

  3. lozza262

    I think the idea is correct that the Tech does try to destroy some of these industries. However from a consumer point of view some things are very good developments. The fitness technology for example is in my opinion good that it allows you to monitor and track fitness much more effectively. For the taxi industry, in my opinion, Uber and Lyft can be quite good in breaking some of the monopolies in this industry. The reason why a taxi medallion was worth $1 million was because you could charge so much to the clients. With google maps the requirement to know the city off by heart has largely disappeared. Although the requirement to have decent screening of drivers is definitely a good thing, it should not be the only reason why taxis are so expensive in many places.
    On the internet of things (light bulb & fridge) I agree that there is little point in them (from my perspective) but then again I don’t see a rapid adaption of this happening right now anyway.

    1. scott 2

      I had a co-worker take Uber to Caltrain in SF from the Moscone center, and I walked. I got there first. Fourth street was closed in one direction for construction but Google Maps kept telling him to take it and around and around the block they went. A Taxi driver would have known a work around.

      I joke that I have a driving service that is always at the airport when I need a ride, and I know how much it’s going to cost rain or shine. It’s called a Taxi.

      1. kevin

        Maybe at the airport.. but I remember the days of trying to get a taxi to come pick me up from my house and it being about a coin-flip if they ever showed up. If nothing else, I’m happy uber kicked taxi’s to provide better service then what I would expect at the DMV

        1. False Solace

          Ah, the ritual denunciation of the DMV. The last several times I was at the DMV, I took a number and sat in a chair while I waited for a reasonable amount of time. When my number was called a competent employee handled everything correctly. It was a far superior experience than any encounter I’ve had with, say, Comcast or CenturyLink, where the employees told flat-out lies and sent me equipment I didn’t actually purchase (I assume some sort of bonus was involved). So I guess I don’t really get the problems people have with the DMV, except it seems to be a touchstone of conservative belief that the DMV is equivalent to the 10th circle of hell. Maybe in your state it is. In mine it seems to function pretty well, and if you want the line to be shorter you’d better be prepared to pay for more employees — just like anything else.

          1. Oh

            Agree. My experience at the DMV has been good and the people who service you are very nice and friendly and not rushed.

            1. JBird4049

              Well, where I am the DMV is always understaffed, the wait too long, and the whole place oppressive, but as long as I treated the staff as human beings, they made things go fairly well.

              I am always amazed that some treat the staff anywhere like dirt. Half of the time whatever problems you have is beyond their control and screaming at people just makes things worse especially for you.

              I just wish that California would increase the funding for the DMV and add hours and staff.

          2. jrs

            The DMV is long long waits (always, I pass the line out the door daily on my commute), plus sometimes incompetence. My car registration got messed up in the system after an accident and I ended up paying it several times.

            Meanwhile I don’t deal with cable companies at all, but I have to drive a lot more than I need cable t.v.. I have actually had good service with my ISP, but it’s not cable.

    2. lyman alpha blob

      Fitness tech makes you think you are monitoring your fitness more accurately.

      You still aren’t going to live forever and could go out like Jim Fixx no matter how many devices you have strapped to your wrists and ankles.

      1. Oh

        Those fitness trackers are really poor and inaccurate. People think that they’re collecting data about their health (others are) but it’s GIGO.

    3. pretzelattack

      why do you need to track fitness in minute detail if you aren’t a pro athlete? a pen and paper work fine.
      re taxis, you forgot the part about having insurance and adequately maintained vehicles, in addition to screening drivers. “breaking the monopoly” winds up costing more.

      1. tegnost

        yes, I think the concluding sentence of the post, that “no one wants this”, is inaccurate, my friends in tech are all about it, they love it and see no viable alternative. They also know in order to be paid they need to monetize and the main source of monetization is cutting labor cost. Re the fitness thing as a lifelong training athlete i never had any problem keeping track. It’s just more of the jobs quote from the post
        “Steve Jobs’ greatest genius was not in engineering, but in marketing. He understood that late capitalism no longer fulfill needs, but create them; inevitably, Apple became the premier exporter of desire, master marketers who compel us lust over their clean-looking products and obsess over them once we own them.

      2. jrs

        I think if Uber has a benefit it’s partly that people use it as a job source between jobs. Unemployed tech person between gigs? Drive for Uber …

        It’s not like the rest of the job market is good except for Uber, it’s still a lot of contract work, which leads to lots of periods of unemployment. Although it is better than it has been, and so Uber is relying more on illegals to drive for them.

        1. Yves Smith

          Lordie, please read Hubert Horan’s now 19 post series on Uber. You are way out of your depth.

          Uber is exploiting the ignorance of drivers who don’t understand the economics of using their car. After making cost estimates that independent parties see as conservative (as in the reality is if anything worse), Uber drivers make between $9 and $10 an hour. This is below a living wage for a single person anywhere in the US.

          1. jrs

            I know someone forced to drive for Uber to make money. Whether it’s good or not, like with most things the alternative is unemployment. They don’t have savings to make it long. I could sit around doing nothing for longer, collecting insufficient to live off unemployment checks, depleting savings, looking for work. But they can’t, no savings left to deplete. I and others have told them to collect unemployment, but I know very well noone can live off unemployment. If they end up deeper in the hole in the long run, maybe they will. That sometimes seems the only choice there is, and this is someone willing to take contract work all over the state, maybe then some.

            And as for illegals, I have it on good word that they use them as drivers, but that’s just the grapevine so one can take it with as much salt as they want

            1. Yves Smith

              “Forced to drive for Uber” assumes there were no other options. With Uber paying $10 net, I don’t agree that this is the best or even a good option. You have to do things to sign up for Uber, your friend was idle during that time. You need to get your car inspected and pass a background check. The latter is usually a week to two weeks.

              Most drivers who drive for Uber are men. Temp jobs for men in not great parts of New Jersey (as in well outside the NYC metro area, hence not part of the wage bubble) paid $12/hour 3 years ago when the economy was weaker. They’d pay at least that much now.

      3. Anarcissie

        If some people want to track their ‘fitness’ with precise if illusory numbers, and they can get it from some device, it’s a positive good for them. I don’t see how it’s up to other people to judge their taste. Same with intelligent lightbulbs or refrigerators or vacuum cleaners or whatever.

        In regard to the taxi industry, before Uber and Lyft, the regulators had been captured long since and it was basically a monopoly in which some rich people made a lot of more money and taxis could not be found north of 96th street, never mind the outer boroughs where people might be improperly pigmented. One might note as well that smartphone (and ordinary phone) ride-hailing was designed and offered to the existing taxi industry long ago and was turned down because, being a monopoly, improvement was superfluous.

        It is true that a lot of high tech has been an effort to create and exploit bottlenecks and strangleholds, for example, Microsoft Windows, which impeded consumer-oriented development of computers for many years. The phenomenon can be best observed and critiqued not by omitting the benefits, real and fake, which baited the hook, but by giving the whole picture.

        1. tegnost

          A monopoly would be if yellow cab were the only company in the nation. A regulated market is not a monopoly.
          Also implicit in ride sharings design is defunding public transportation so that ride sharing would be, as you say,,,
          a monopoly in which some rich people made a lot of more money

          1. George Phillies

            Regulated? Taxi medallions in New York went for hundreds of thousands of dollars, which was a state monopoly with a fixed and inadequate supply. Uber and Lyft meant that travel was available during rain and in minority areas not served by medallion cabs.

            1. tegnost

              New York isn’t the only city in the us and has to cope with it’s own sprawling problems, one of which now is circling uber and lyfts clogging traffic. Regulations are indeed a sort of governor in a carburetor, controlling flow. In this light, flow improvements such robust public mass transit conveniently timed and located are good things for cities to consider. It is generous of softbank et al. to pursue the altruistic principle and subsidise transportation poorly served areas which they surely do from the bottom of their cold cold hearts. Alternatively, there’s this…

              1. JBird4049

                Better service for the melanin challenged. Oh, how just surprising that is!

                Sometimes I have had the privilege of shopping in the wealth deprived areas of the Bay Area and would you believe that the grocery and other stores and services are. Always. Worse. In. Everything. It is just amazing what a few miles will change. Same chains but somehow…

        2. pretzelattack

          and this sounds like the kind of argument for innovation that ignores long term costs. uber doesn’t ensure that there is travel available during rain, it does ensure that you may pay surge pricing for a ride in a vehicle that may not have been maintained and is driven by someone that hasn’t been vetted, either for driving safety record or criminal record.

        3. Oh

          Uber and Lyft will jack up their prices once the taxis cease to exist. Then all prices will be the rush hour prices you can’t afford!

        4. Yves Smith

          Sorry, the idea that obsessing over irrelevant personal metrics is productive or good for you is a canard promoted by the vendors of said devices and the gadget-loving press….which sells ad space for gadgets.

          See for instance:

          My main objection to the use of wearable devices for fitness or weight loss purposes is that they have the potential for generating anxiety, particularly among people with eating disorders and those prone to exercising excessively. In a 2015 article in the British Medical Journal, Des Spence, M.D., a general practitioner in Scotland, made the point that wearing a tracker can turn users into self-monitoring neurotics as they focus unnecessarily on their normal activities and vital signs. “The truth is that these apps and devices are untested and unscientific, and they will open the door of uncertainty. Make no mistake: Diagnostic uncertainty ignites extreme anxiety in people,” Dr. Spence wrote.

          A large study published in Lancet (n=800) found they don’t work:

          There were no improvements in any health outcomes (weight, blood pressure, etc) at either assessment.

          That’s better than a study published in JAMA (n=471), which found that the participants who didn’t use fitness trackers lost on average 8lbs more than ones who did:

          So if you want to believe in digital snake oil, be my guest.

        5. Geo

          I used to have a fun hobby of hauling taxis for those with darker pigmentation. It’s was upsetting to see someone trying to hail a cab to no avail when I could get one easily so I’d flag one down then offer it to the person who’d been trying in vain.

          NYC taxis are nothing to mourn. I’m sure there is a better way than Uber/Lyft but the NYC taxis weren’t that. The smells, filth, rude drivers… last one I took stopped at a McDonalds in the way into the city from jFK airport, smoked, and constantly yelled at other cars. It was amusing and fortunately I wasn’t in a hurry. But, not an ideal ride.

      4. kevin

        “Breaking the monopoly” winds up costing more–you’re going to have to provide a lot more for us to take this assertion at face value

        1. pretzelattack

          for one thing it is a regulated market, not a monopoly, and breaking it leads to the costs mentioned in the article. the mom and pop small business taxi owners get priced out of their business, because the rentier app company doesn’t have to meet the costs of ensuring the benefits of that regulated market.

    4. TroyMcClure

      “Fitness” as a concept isn’t really trackable and the margin of error on those devices has been proven to be very wide.

      1. lyman alpha blob

        I posted a comment earlier which Skynet eradicated, but yes this tech makes you think you are monitoring your fitness more accurately but you may still go out like Jim Fixx no matter how many devices you have strapped to your wrists and ankles telling you that you are the picture of health.

    5. IdahoSpud

      I have an old-school fitness tracker – A Polar heart rate monitor with a single push button that displays one large number. When I’m done, it shows the average heart rate and the elapsed time.

      Importantly for me, it doesn’t share that information with some app developer and multiple third parties (AKA please read and accept our terms and conditions to start using your new device).

      I fail to see how ‘fitness tracking’ would improve my life in any way – do you have to take time to learn the device and enter your calories consumed? Complexity for its own sake is no benefit.

    6. TimmyB

      It’s funny to read that Uber and Lyft can be good in breaking monopolies in the taxi industry. Actually, Uber and Lyft will be unprofitable if they cannot create monopolies in the taxi industry.

  4. Jim A.

    One of the other advantages of taxis, is that you pretty much know how much they will cost. The amount is fixed by regulation and there will be no surge price sticker shock. Of course DC has no medallion system, and without artificial scarcity, it hasn’t really ever been a middle class job. Until recently, there weren’t even any meters, but instead a “zone map” which determined fares.

  5. templar555510

    Excellent piece . Here’s the ‘ but ‘ . If like me you were born seventy plus years ago you began your life and lived to become an adult in a world that was , technologically , unlike the present world. That is to say , that that world was not digital . There was new technology aplenty, but as the writer suggests each innovation or invention was perceived as being an improvement on the existing technology. That perception does not apply to those under the age of forty, who , if they are not now, will soon become the majority. To them the removal of the jack socket from the iPhone is simply a minor inconvenience, or perhaps none, to which they will accustom themselves and similarly, in the future, make all sorts of accommodations and allow complications where none existed before, to take over their lives, in order not be left behind . And that I believe is the overriding imperative which the tech behemoths know and use to their advantage to increase sales and thus profits. Put in more simple terms – they know a bunch of suckers when they see them.

  6. ChieftanBoris

    Great article. I still wonder why the hell we had to get onboard with that wheel, and boats and the whole farming thing. Hunter-gatherer society was perfect and required no Uber or CafeX’s, amiright?

    1. tegnost

      If uber is as great a discovery as the wheel, then I suspect it may at some point be able to pay for itself

    2. pretzelattack

      i’m struggling to think of the contemporary comparison in hunter gatherer society? what did they use for wheel apps?

  7. TG

    You are wrong about the career of taxi driver being destroyed by Uber and Lyft. That career was destroyed long before, the same way that meat packing and so many other once-good jobs were: by flooding the market with cheap immigrant labor (yes I know: the law of supply and demand is racist, what can I say). Large taxi companies used to have central shops, drivers were valued personnel. Then the big companies shifted to a kind of sharecropping model, where desperate people now had to maintain their own cars and work long hours and the owners skimmed most of the profits. Uber and Lyft are, I think, destroying what’s left of the taxi business because that business has for so long not cared about infrastructure or investment, they can’t even imagine how to respond any more… The big money has started to unload the medallions onto hapless drivers, just as the market for them has crashed, but for some time a medallion was license to exploit a driver.

    1. Yves Smith


      Many studies have shown that taxi drivers make $12 to $15 an hour net, v. $9 to $10 for Uber/Lyft when you factor in the cost of operating the car (and some NC readers have argued that that estimate of those costs is low). In other words, drivers were making barely a living wage for a single person.

      And your claim does not make sense. Generally speaking, in large cities, the cab companies own and manage the cars. It’s only in small cities that you find cab companies where the driver owns the vehicle.

      1. TimmyB

        Taxi companies in most places do not “own” the taxi cab. They are owned by the individual driver. This way, when a driver runs you over, the company escapes liability. Next time you take a cab in any large city, look for the notice that the cab is independently owned and operated. It’s there.

        1. Yves Smith

          Don’t make stuff up. In most large cities, taxis are owned by fleet operators. This is as reported by Hubert Horan, who has spent 40 years in the transportation business. Even in libertarian Texas, in Dallas, eight companies provide taxi service, and they own the cars. In his series, Hubert has stressed that fleet operators can manage the vehicles more cost efficiently than independent drivers can. They have a cost advantage.

  8. Jim A.

    I would add Newspapers to this list. Not just because people rely on newsfeeds rather than a subscription to the paper, but also because Craigslist killed the classified ads. And Craigslist IS a much better market tool for used stuff than the classified were. ISTM that Silicon Valley concentrates on being an intermediary for two reasons. Software is what they DO, and when you have a hammer, everybody is wearing a nail shaped hat. And because software has a near-zero marginal cost of production. This means that eventually market dominance gets to the “every additional customer is almost pure profit.” point. Of course they have discovered with ride sharing that may not be the case.

    1. eg

      “Silicon Valley concentrates on being an intermediary” because they recognize networks and their nodes present rentier opportunities.

      They are modern day House Frey …

  9. S Haust

    Well, why didn’t they just call it “McDonald’s”. They couldn’t have possibly offended anyone
    that way; could they?

    And if challenged they could have just said, “Oh, we thought [it was] an homage to the local corner store, the people who ran it, and their place in our collective conscious”. Then they could have rebranded it as, say, something really silly like “vending machine” or “convenience store”
    or even “bodega”.

    They wouldn’t have been criticized on their second try; would they?

  10. voislav

    Lack of agency is missing here. Consumer demand is driving all this stuff, not some desire of tech industry to ruin things. Very few homes are built as smart homes, most smart home appliances are add-ons to dumb homes. Same with fitness, consumers are choosing to buy these devices and wear them.

    So ultimately, tech is only following consumers down a rabbit hole, not the other way around. Consumers are more than willing to sacrifice their privacy and personal information and pay good money for gadgets that are ultimately not very useful. Tech industry graveyard is full of companies that were rejected by consumers, so it’s hardly the case of industry forcing itself into the market.

    1. Kukulkan

      Consumer demand?

      A week ago Mozilla surreptitiously introduced an update into my Firefox browser that disabled various add-ons I was using. Until that happened, I’d been using Firefox 56 — about ten updates old; I think the current version is 66 — the last version which the add-on Tab Mix Plus worked, which allowed me to arrange my tabs how I liked them: below the address bar, fixed width, arranged in rows. Now Tab Mix Plus no longer works and I’m stuck with some Silicon Valley programmer’s idea of how everyone in the world *should* have their tabs arranged.

      I honestly don’t remember demanding this.

      I also don’t remember any big ground swell of demand that Apple remove the headphone jack from their iPhones, or glue them together, making changing the battery unnecessarily difficult, or discontinuing the iPod with its touch-based interface in favor of a new version with a touch screen interface making it functionally useless for my visually impaired friend, or any one of a hundred other things the tech companies have just arbitrarily handed down and made next to impossible to opt out of.

      I suspect your notion of consumer demand is very different to mine.

      1. Fried

        The Firefox thing was a bug that disabled almost(?) all add-ons and it has been fixed. I’m on 66.0.5 and all my old add-ons are working again.

        1. Anon

          Same here. However, I agree with Kulkukan: don’t need forced downloads with major bugs. How many days did it take you to get your Web privacy/security protocols back? In that time Google and other aggregators gathered all the information they need to hone their tracking of your Internet use.

          Dropped Firefox for good. Opera with VPN option is the way to go.

        1. Kukulkan

          Thanks for this. I just finished recreating my old set up and am very happy.

          Now this is consumer demand!

    2. Robert McGregor

      Voislav, No offense, but are you a tech industry libertarian troll? Consumers didn’t demand an iPhone, and have Steve Jobs deliver it. He famously said, “Consumers don’t know what they want; I tell them what they should want.”

      1. Anarcissie

        Hasn’t this been true since around 1920 or so? Prior to that era, most of what was sold, basic goods, were already known to the public. With the advent of new products and services, one had to propagandize people into buying them; hence the rise of the advertising industry.

        1. pretzelattack

          people liked the idea of getting across states in hours rather than days. i don’t think they had to be propagandized much.

          1. Anarcissie

            Automobiles did not provide that, because in 1920 there were very few highways and expressways and the vehicles were not that fast anyway. The advertising of the era makes me think that they were mostly a status symbol for rich people. That probably took some propagandizing at first.

      2. vlade

        They didn’t demand an iPhone. But there was already demand for on-the-go music players (remember all those?), for “smart(ish)” phones (Blackberry) etc. etc. It wasn’t even that large an innovation – it was a belief that customers would be willing to put up with an on-screen keyboard (which no-one in the industry believed).

        Job was a great marketeer, and selling Apple as “innovative” (when it was really ripping ideas from a lot of other people – but being much better at marketing them) was one of his great gigs.

        Where “what they should want” comes in is way more in “gadgets as jewelery/haute couture” than any real technological innovation.

        1. Harrold

          After seeing the iPhone, Google immediately canceled production of their next devices and moved from ones that looked similar to the Blackberry to a keyboardless model similiar to the iPhone.

      3. nycTerrierist


        I would walk a hot mile not to purchase a ‘smart’ appliance for my home.

        Yes, I do have a laptop and iphone — and realize one can’t completely avoid being data-mined — but I refuse an additional tax on my time to ‘manage’ my ordinary household objects.

        1. Oh

          It’s going to be harder for us to buy an non “smart” appliance in the future, thanks to the worthless technology they they push on you (most to snoop on you and sell the data). SiliCON valley can go to hell.

    3. jef

      Voislav – You are missing the point. Tech is aggressively forcing themselves into a market by seriously undercutting the real cost of doing business then when they have successfully bankrupted that industry and they are the only player left they charge more. At least thats the plan. Problem is there is always someone else waiting in the background to undercut the undercutters if they charge too much. Trick is to get too big to fail or just keep on operating without a profit which sounds rediculous but it works so far.

    4. Skip Intro

      Consumer Demand is not an abstract a priori, it is fabricated by the industries that are also working to fulfill it. That point was made in the piece.

    5. Yves Smith

      Consumers also “demanded” snake oil like Gwenyth Paltrow’s jade vaginal eggs. The fact that you can make a buck off something doesn’t mean it is societally valuable.

  11. Eric

    Does replacing humans with robots actually reduce labor costs?

    How much does it cost to maintain and power a robot per year?

    Will the robots be owned or licensed? What happens as the licensing feefor gets jacked up? Without “right to repair” laws (and possibly even with them), what is the chance that the manufacturer jacks up the prices of necessary and proprietary replacement parts?

    I find it difficult to believe that robots will be cheaper than people working for minimum wage…

    1. Synoia

      Robots don’t need retirement or health care, and don’t form unions.

      And the understanding that employees are also customers, and customers are a common good, does not exist is the “cutting cost” dogma of modern businesses.

      Business is essentially a feudal system. The solution to that structure is cooperatives. That however, is a complete social revolution, and possibly not a component of human behaviors.

  12. Watt4Bob

    Big tech is promising the 1% the Holy Grail of making money without employees.

    In the auto industry for example, the manufacturers have long wanted to do away with dealers, and dealers want to do away with employees.

    The manufacturers have been lobbying for years to do away with state-level laws that forbid dealerships owned by the manufacturers, but mostly, the dealers are politically powerful at the state level, and have held off the manufacturers efforts.

    The dealerships themselves are trying to do away with employees, sales people, finance assistants, and service writers for instance by cross-training a new type of person who can handle sales from internet lead, to delivery, while lower paid call center employees take over communications with service customers as well as internet sales leads.

    I have no doubt that eventually we’ll see a sort of Uber for car repair, poor struggling technicians, driving around picking up parts and fixing cars in parking lots and customers driveways, not employees, but independent contractors, squeezed to the max, and living a precarious existence, plagued by back-ordered, or defective parts, tight, unrealistic schedules and responsible for impossible to achieve customer satisfaction numbers.

    You may have seen ads on TV for virtual dealers who promise to deliver a new automobile directly to your door on the back of a flat-bed tow truck?

    Standing on the sidelines are supposedly intelligent people cheering on the carnage in the hope for lower prices.

    What those people forget is that dealerships are the intermediary between unhappy customers and the manufacturers, and it is often the sales person who pleads the customer’s case in disputes with dealership and manufacturers.

    Who are you going to complain to about your new car, the tow truck driver?

    What I see is a race to the bottom, and a contest to eliminate perceived obstacles to higher profits for the few, destroying businesses long term health and with it the communities that surround them.

    All businesses doing away with employees, leads to penniless ‘customers‘ and so, no demand for products and services.

    A customer with no money, is not really a customer.

    It’s not creative destruction, it’s mindless destruction, perpetrated by people so wealthy that they no longer care about the future be cause ‘they’ve got theirs‘.

    It’s quite frustrating to watch all this destruction, perpetrated by scammers, cheered on by people who think every facet of their lives can be improved by an app they installed on their smart-phone.

    1. Robert McGregor

      Watt4Bob, Great dystopian writing. Do you have your own blog? . . . Also, Kurt Vonnegut covered what you write about above in his novel, “Player Piano.”

      1. Watt4Bob

        Thank you.

        Kurt Vonnegut is one of my favorites, and yes, he certainly saw all this coming.

        1. eg

          As did Walter Reuther, who related this exchange that took place during a tour of the newly automated section of a car plant:

          “The management man, marveling over the robots’ performance, asked Reuther “How are you going to get them to take out union cards, Walter?”

          Without hesitation, Reuther replied “How are you going to get them to buy cars?”

    2. Cal2


      “You want my money?”
      “Then provide me with decently paid, happy employees, some of my age cohort, that are native speakers of English and that I can deal with in person or on the phone.”
      “No, I will not go to your website, load your app, join your medical portal, or participate in what you want me to do for your convenience and added profits.”
      “You want my personal data details? Make an offer for payment, a discount or free services.”

      As to hacking, never allow the refrigerator or light bulb to connect to your router.
      Better yet, for health and privacy:

      How to Install Wired Internet in Your Home
      “With many of the internet service providers (Comcast, AT&T, etc.) hoping to use their wireless modem to control your “smart” home, having a wired internet setup can be more challenging than it was 5-10 years ago. The following specific steps will help you navigate this process so that you don’t have the privacy, security and health risks associated with the powerful WiFi modems these companies provide…”

      1. Cal2

        Forgot to add, before you buy a product or service, call the toll free product help number, not the sales number, and judge the quality of who you are speaking to.

        If you get “go to our website” on the phone, or end up speaking with some abused overseas slave, boycott the product and service.

        I have gotten credit cards to reverse charges, waive fees and do other things based on complaints about the ability of people to speak English who work for them on the first call I made, who said “no”, Try it,often they say “yes.”
        Americans need decent jobs.

    3. Oh

      The fools that go for Uber, Lyft, smart appliances etc. think it’s really convenient for them except they don’t understand that all these are meant to capture their most private activities. Morons!

      1. Geo

        It’s the same shortsightedness that lead to box stores gutting towns, cheap goods made by overseas sweatshops gutting factory jobs, and so many other issues where immediate gratification outweighed long term benefits.

        Cheap and convenient are what determines value it seems. Not quality and sustainability.

  13. Musicismath

    I can’t help connecting Silicon Valley’s systematic attempts to eliminate human interaction from the economy with Simon Baron-Cohen’s research into the prevalence of autism among Silicon Valley programmers. Many people on the spectrum find human interaction stressful and exhausting. They put a lot of time into establishing elaborate daily routines to minimize the amount of social contact they have to endure. So I’m not sure it’s accurate to say “no one wants this”: for a programmer or engineer whose brain wiring inclines in a certain way, coming up with workarounds to avoid human contact might seem like a major research priority. Put enough of them together into a series of ruthlessly competitive tech companies, all working on the same “avoidant” technologies, and you have a force capable of changing society irrevocably.

    1. GM

      Do not confuse the autistic programmers with those driving these changes in the economy, they are usually (with some exceptions) not the same people.

      The “autistic programmers” are not the type to rise to the top of the corporate ladder, precisely because of their lack of personal skills and obsession with the technical side of things. They do their job and do not have much influence on the decisions of the higher ups.

      A big reason the tech industry has changed the way it has is that since the time of the dot-com bubble, it became prestigious to work for it (whereas in the past it had been the domain of the nerdy socially awkward geeks fully focused on the engineering aspect of things and being ridiculed by the outside world for not fitting in it). That process has only been accelerating.

      So you started getting more and more and more of the kind of people that would have previously gone to Wall Street (where their job would be to ruthlessly scam and exploit the rest of society through various legal-but-should-be-illegal schemes) going to the tech world instead. And, of course, Wall Street itself became a tech enterprise to a large extent so those worlds got closer and closer.

      In the process the culture of the computer science and engineering departments changed too. This is why you now see MIT and Stanford undergraduate and graduate students thinking not about developing groundbreaking algorithms and devices but about what “disruptive” start up they are going to launch.

      The universities became corporatized, and now it all feeds onto itself in a giant vicious self-perpetuating loop.

      But had it been left entirely to the nerds, you would not be seeing these outcomes, so do not blame them for it.

  14. Phil Snead

    Machines are made to work, period. In our greedy heedless excitement about tech we’ve lost awareness that human beings can’t compete with tech because human attitudes are both diverse and system-integrated in a way tech can never match. Our work used to be only the way we sustained human life; now we see the opposite. Work, and human nature itself, have grown subordinate to capital that exclusively strives to concentrate itself through technology.

  15. ted

    How much of any of the world of tech rentier behavior would be possible without an ocean of cheap credit sloshing around the world? And let’s be honest, how much of any of this has proven to be profitable or sustainable? As for the latter, I suspect the average use-life of any of these great “innovations” is rather short, maybe 1 to 3 years after initial adoption by the consumer. Once the credit dries up to keep these innovators running their shops, the product dies quickly. As we will soon see with many of our current “” behemoths. Once companies that sell basic consumer appliances realize they need to radically cut costs in a drastically diminished credit environment, then we will see a global army of newly impoverished techies living in slums and tent cities … as manufacturers return to analog consumer product designs.

    1. Robert McGregor

      ted, I love that vision–not a James Howard Kunstler vision of “World Made by Hand” but a ted vision of “World Returns to Analog.”

  16. Synoia

    There is a rumor that these pesky, expensives employees have another collective noun.


  17. Shonde

    Read the link to The Climate Change Story is Half True. Then apply what is being said in that article to the needs of the tech industry. The tech industry is not only energy hungry but also resource intensive. How long will the future life span of the tech industry be based on all the issues related in that link? Maybe climate change and resource depletion will save us from robots and apps replacing us.

  18. polecat

    As apes baring keyboards, virtual or otherwise, we will find that through simple hominid inertia, we will progress to the point where Mother Gaia will ensure our hierarchical place .. in the mud, Oldivi style …

  19. Irrational

    I shudder to think what a $4 robo-coffee will taste like. And can it do pretty patterns with the frothed milk?

  20. Hepativore

    I do not know where I stand on the issue of automation. On one hand, if there is a push to automate a lot of retail and fast food positions, this might actually be a good thing as many of these jobs are low-paying and quite miserable for the people that do them as they are often overworked and under-appreciated.

    If people could be freed from these jobs, it might be a net gain…BUT…if this is going to be pushed, there had better be something for all of these displaced workers to go to. I am not naive enough to think that it would lead to a second industrial revolution in terms of the growth of new jobs. However, I also think that a combination jobs guarantee/basic income program should be set up to accommodate people that are displaced from these sectors that are being automated and that the benefits of automation should be shared somehow instead of just going to the to 1%. It might be a long way off, but we might be reaching a future where the role of human labor is drastically reduced, but we should at least make it so that everybody can gain from it instead of the owners of capital.

    As for “smart” appliances, I always thought that they were just excuses for Google and pals to collect more data on you and sell it to third parties like advertisers and the NSA.

    1. eg

      I believe that this is among the premises for the Federal Job Guarantee as proposed by Randall Wray et al.

  21. Ed Zimmer


    Plain old fear of change! Yes, life is changing. Change is accelerating. And you ain’t seen nothing yet! Business managers are slowing that change – by well over 10 years. (Ask any business tech consultant how little of existing technology business managers presently take advantage of.) And government managers and politicians are even worse as they don’t have competition pressing them to improve quality and lower costs. You want to see real innovation, take a look at what the young are doing on some of the open source sites.

    We’re in a digital revolution. This is unlike any of our prior tech revolutions in that it’s giving us the capability to automate mental as well as physical processes. Certainly it’s causing economic chaos, because it’s threatening EVERY occupation (and not because someone’s out to kill jobs – but simply because our knowledge is allowing hardware to do MANY tasks better and faster than humans).

    We’re in the throes of underemployment and a gig economy – and the trendline will just continue the chaos until we start to find the value in leisure that we found in work. (It’s easy to say until government – or business – starts doing its job – but, more accurately, until society (all of us) gets its act together and faces up to this new world we’re living in).

    1. Oregoncharles

      “(Ask any business tech consultant how little of existing technology business managers presently take advantage of.)”

      I’m not that, but I’ve tried using Slack and some of th eother “business technology,” and it’s more of a barrier than a road. Maybe all that “technology” is just famil blogged. Up. See Lambert’s preface to today’s Water Cooler.

      (And at the moment, m ” ” doesn’t work.)

      1. Ed Zimmer

        The tech industry badly needs some anti-trust actions and patent law reforms. If several businesses were competing in fulfilling your software options, you wouldn’t have this problem. But entrepreneurism (at least in the USA) has been dead for at least 20 years (when venture capital came on the scene). Today’s young entrepreneur has no chance of building a market – they’re either prevented by patent law from introducing their product or copied (or bought out) by one of the large tech firms (who could care less whether your particular software wishes are fulfilled and maintained).

    2. MyLessThanPrimeBeef

      Why should people not fear change, if we have not been offered at least some ideas of what the best scenario of the end result will look like? And we have not…only news and images of some people getting very, very rich.

      In that case, compassion dictates we allow people to imagine dreadfully the final chapter of the book where one universal machine that can produce any product and render any service any person could ever want, is owned by one single person. We permit that because we should feel no superiority, no virtuosity being on the same planet as those people who fear like that, given they only see a few persons are in the race to become the first trillionaire…perhaps to achieve immortality as well.

    3. Carey

      I’m having a hard time understanding what you’re getting at.
      Who creates “this new world we’re living in”- and to whose

      What are we proles doing wrong, at present, from your POV?


  22. Pelham

    As much as I love this site and a few others, don’t the points made in this article and many other factors (soaring rates of anxiety, depression and suicide, for example) amount to excellent arguments for just getting rid of the internet? Or restricting it to its original purpose linking scientists and laboratories?

    Of course, we’re probably too far gone to do anything like this. But if we could, and we could do it in a measured way that wouldn’t cause sudden disruptions, I’d personally be all for it. But I’m open to argument.

    1. Ed Zimmer

      I suspect it’s not the “internet” you’re objecting to, but some of its wild-west aspects. The internet is an amazingly efficient and convenient communications tool – but it does need (and will ultimately get) some regulation.

      Pre-internet, we had our newspapers and magazines (content general to very specific). Most of these we could comment to via letters-to-the-editor or rebuttal articles – but there was an editor in place who decided what got published and what didn’t. That’s what the internet is missing.

      One could get access to current information of interest (with effort and monetary cost) – but with severely restricted diversity of detail and opinion. Personally I would not like to lose either the ease of access or the diversity of the internet. But that diversity carries a volume of commentary and opinion that no editor could practically handle. (AI might ultimately become a practical solution.)

      But a simpler solution is the meantime might be to require validated identities of internet participants. Pre-internet if Party A insulted (or in some way harmed) Party B in print, Party B had the option of pursuing legal action against Party A. The internet lacks that option because none of the internet service providers require participants to validate their identity before participation.

      That shouldn’t be an onerous burden to the service providers – no more a problem than for government offices validating identities for drivers licenses, passports, etc. (In fact if required, it’s likely one service provider would evolve specializing in validation). Participants might object to loss of privacy – but it would be their price for orderly and controlled internet participation – no more loss of privacy than when they subscribed to newspapers or magazines with check and mailing address.

  23. Iguanabowtie

    Im no fan of silicon valley, but Fitbits and smart lightbulbs are 100% optional. (I personally opt out of both) Neither the lightbulb or fitness industry are (afaik) unduly distorted by the presence of these entries, unlike Uber & the taxi industry.
    Bodega seems like a bad idea (they’re gonna get robbed blind, innovative camera tech or not) but eliminating dreary underpaid retail employment sounds good to me, having done it.

    1. Brooklin Bridge

      Smart gadgets are optional for the time being.

      I suspect in ten years it will be quite difficult to get, for instance, a heating or cooling unit such as a furnace that is not networked, never mind a refrigerator or stove. Your utility may or may not require that connection, but it will be there. I’m surprised they havn’t yet used global warming as the excuse to get into every watt and therm you consume and where you are physically in the conditioned space when you consume it and what you are thinking -heuristics still- and how you look. Small connected gadgets like toasters will likely just stop advertising the fact they are “smart” (you will assume you can connect via your phone) and will get their own back doors to routers. Trying to find a toaster, or a programmable thermostat, or what not, that’s not connected will be like trying to avoid buying anything made in China; virtually impossible. The lust for data is driving tech mfg. to go nuts.

      1. Yves Smith

        Correct. The insurance industry is pushing to require customers to wear monitors. Matt Stoller wrote how accepting intensive monitoring would be a requirement for getting auto and health insurance IIRC in 2012.

      2. nycTerrierist

        As more people get ‘woke’ to the downsides of this ‘smart’ stuff (data-mining, nuisance, etc.)…

        the niche market for un-‘smart’ stuff will only get bigger.

        Business opportunity!


      3. Carey

        “Ten years”? They’re stuffing my small, low-rent™ apartment building (fourteen units) with this privacy-destroying crap now.

        should be fine

        solidarity is the *only* answer

  24. none

    Lol, “available now from major booksellers” with an amazon referral link. I’ll look for it at one of my city’s remaining physical bookstores I guess.

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