Can platform socialists defeat our tech overlords?
For four decades, technology has fostered winner-take-all markets and driven politically destabilising wealth inequality. Is a pivot possible at this point?
If you aspire to become a centibillionaire, you don’t have to start a tech business but it’s definitely your best bet. At the time of writing, 70 per cent of the world’s Top Ten richest people are tech types. Despite recently giving his ex-wife a US$38 billion payout, Jeff Bezos is still worth around US$170 billion. The inconceivable wealth and entirely conceivable political power of Bezos (who lists the Washington Post among his possessions and spends around $20 million a year lobbying Washington lawmakers) bring to mind the robber barons of the Gilded Age (think Henry Ford, Andrew Carnegie, Cornelius Vanderbilt and John D. Rockefeller).
Even on the Ayn Randian sections of the Libertarian Right, there’s now growing concern about a handful of neo-feudal techno lords hoovering up most of the money. But I come neither to praise nor damn the modern-day Nerd Caesars. I just want to explore whether gig economy types can leverage technology to pull themselves out of neo-serfdom.
Technology is just a tool
Like many things, technology is neither intrinsically good nor evil. It is, quite literally, just a tool that can be used for wise or foolish purposes.
The end of what might be labelled the social-democratic age in the 1980s didn’t come about due to the mass penetration of calculator watches, VHS recorders and Nintendo Game Boys. It came about because politicians of first the Right and then the Left introduced ‘business friendly’ policies that were always going to reverse the post-Gilded Age trend towards greater income equality.
It’s long been convenient for elected officials to shift the blame for inequality onto technology (‘Hey, it’s automation/the Internet/network effects/AI, whaddya gunna do?’). But the Gini coefficients of nations such as the US and UK would now make for less disturbing reading if their politicians had been less eager to cut taxes on wealth creators and erode the bargaining power of labour. After all, Sweden – home to the likes of Skype, Spotify and Klarna – has somehow managed to thrive in the digital age without vaporising its middle class and pushing much of what used to be its respectable working class into the ranks of the despairing, drug-addled underclass.
All that noted, it would appear that the fourth industrial revolution (like the first one) has set the stage for a handful of individuals growing obscenely rich at the expense of a far greater number of individuals being pauperised. The economic and social consequences of the first industrial revolution birthed old-school socialism. Could the economic and social consequences fourth industrial revolution give rise to some form of technosocialism?
Platforming collectivism
Despite the Left’s fondness for grand visions, most progressives haven’t been thinking big about reversing the slide into neo-feudalism. The consensus progressive view at present seems to be that it might just be possible to get the Bezoses of the world to start paying a little more tax, then redistribute this money to the non-Bezoses. (Of course, the unemployed/underemployed non-Bezoses will then hand most of their modest remittances back to the Bezoses – who will have entrenched their economically dominant position – in return for goods and services.)
A small number of progressive intellectuals dare to dream that emerging technologies, particularly blockchain, could help foster, ahem, common prosperity. Their dreams may come true, but they usually can’t point to any real-world developments that provide grounds for optimism.
In contrast, James Muldoon, a proponent of ‘platform socialism’, can kinda, sorta, point to some encouraging green shoots.
If you want to take a deep dive into Muldoon’s hopes for platform socialism, you should read his book or at least this article he wrote for Open Democracy.
Muldoon’s first point, which I wholeheartedly agree with, is that it’s pointless for critics of Big Tech to focus on the putative moral bankruptcy of individuals such as Bezos and Zuckerberg. If whatever evil Bond villain, tech company founder/CEO you love to hate got killed in a Davos avalanche tomorrow, their successor would almost certainly behave precisely the same way.
Facebook acts the way it acts not because Zuckerberg is a psychopath but because it is a business seeking to maximise its profits. You can argue tech behemoths such as Alphabet, Microsoft and Meta should be broken up and/or subjected to much stronger regulation, but there’s no future in pathologising the people who founded these companies or who currently run them.
Muldoon’s second point is that, rather than slagging off Bezos et al, progressives should be concentrating on fighting for platform socialism. He defines this as “the social ownership of digital assets and the democratic control over the organisations and digital infrastructure that have become so critical to our everyday lives”.
The Ubers of, um, Uber
Uber is the paradigmatic digital economy business. Since 2010, an ungodly number of start-ups have been described as, or actively marketed themselves as, ‘The Uber of …’. So, let’s quickly compare and contrast the actual (capitalist) Uber with a collectivist Uber.
Uber has been in the red for almost all of its existence. Nonetheless, its founders and backers believe that, like Amazon, after first burning through mountains of cash it will eventually start generating mind-boggling profits. Let’s park the question of whether that will transpire and simply look at the business model.
Uber doesn’t do much other than provide the platform that makes it straightforward for people needing a ride to connect with those willing to offer them one, but it takes a 25 per cent cut. Uber invested vast amounts of money in self-driving car tech, in the hope it could eliminate human drivers and pocket all the money riders fork over. But Uber’s leadership team have now resigned themselves to the fact they can’t automate their human drivers out of existence anytime soon.
Uber drivers aren’t treated worse by Uber than their taxi driver predecessors were by taxi companies, but neither are they treated much better. As they are incentivised, indeed legally obliged, to Uber executives do everything possible to keep driver earnings to an absolute minimum. It’s difficult to generalise about the remuneration of Uber drivers. However, once costs such as fuel, insurance and wear and tear are factored in, most seem to make little more, and often significantly less, than the minimum wage.
Now let’s imagine a collectivist Uber. The platform Uber provides to ride-givers and ride-takers isn’t difficult to replicate, which is why a host of ride-hailing businesses have sprung up to compete with Uber across the globe. Why couldn’t some drivers in a particular geographical location form a co-op, spend a few bucks getting a platform built, then pocket 95 per cent (there would be admin, IT and marketing costs drivers would have to contribute towards covering) of the money they make giving rides?
As it happens, this isn’t a hypothetical scenario. If you ever find yourself needing a ride in New York City, you can avail yourself of the services of The Drivers Cooperative, a “driver-owned ride-hailing cooperative” that offers “pay rates higher than Uber and Lyft”.
As Muldoon points out, “At the local level there are already handiwork, courier services and domestic-cleaning platforms run by platform co-operatives – enterprises owned and managed by the workers themselves”. Muldoon seems particularly impressed by the online task marketplace Up & Go. It “enables workers to keep 95 per cent of their wages from jobs obtained on the platform rather than the usual 50-80 per cent” and gives the cleaners and IKEA-furniture assemblers that use it “an ownership stake in the platform and [a] vote on platform governance”.
Just because workers can unite, doesn’t mean they will
“I have seen the future and it works.”
Lincoln Steffens upon his return from the Soviet Union in 1919
As inspired as he is by the existence of a handful of digital co-ops, even Muldoon doesn’t seem bullish about the prospects of platform socialism. He notes that “it has been difficult for co-operative social networking services to achieve the same smoothness and functionality as larger corporations” and even more challenging to get “users to adopt smaller platforms and move away from dominant networks”.
There’s also the problem of accessing capital to launch and grow co-ops. People throw money at start-ups such as Uber in the hopes of making a spectacular return on their investment. By definition, this kind of investment-attracting potential pay-off doesn’t exist with co-ops. Muldoon suggests co-ops could be given money by “local authorities” to set up, for instance, co-op versions of Airbnb, but even he doesn’t seem to think that’s likely to happen.
And as anyone who has ever been involved in a university group project or non-hierarchical community group can attest, collectives tend to be a lot more attractive in theory than in practice. Modern technology can remove a lot of the friction from setting up and running co-ops, but it can’t change human nature.
So, what happens now?
New technologies, notably railroads and heavy industry, facilitated America’s Gilded Age. For many years, railroad tycoons and captains of industry were able to amass great fortunes and wield enormous political influence because, firstly, they were creating entirely new industries and, secondly, the electorate was distracted by what would today be labelled culture war issues.
But the party eventually ended for the Vanderbilts and Rockefellers. Not because American workers formed co-ops en masse but because a Republican president had the political capital and courage to bust up cosy oligopolies (or outright monopolies), start regulating new industries, empower labour unions and generally stand up to “the wealthy corruptionists of enormous fortune and… their agents of the press, pulpit, colleges and public life”.
I’m doubtful that platform socialism will bring the contemporary Gilded Age to an end. But with politicians belatedly finding the cojones to tax, regulate and even break up tech companies, I’m hopeful the drift towards Latin American levels of inequality may soon start to be reversed.