Tag: Defensive Elites

The fascination with the propensity of tech founders to go silent reminds me of how the earliest philosophers were framed as unworldly due to their capacity to go into thought trances. From Roger McNamee’s Zucked, loc 269-284.

This little speech took about two minutes to deliver. What followed was the longest silence I have ever endured in a one-on-one meeting. It probably lasted four or five minutes, but it seemed like forever. Zuck was lost in thought, pantomiming a range of Thinker poses. I have never seen anything like it before or since. It was painful. I felt my fingers involuntarily digging into the upholstered arms of my chair, knuckles white, tension rising to a boiling point. At the three-minute mark, I was ready to scream. Zuck paid me no mind. I imagined thought bubbles over his head, with reams of text rolling past. How long would he go on like this? He was obviously trying to decide if he could trust me. How long would it take? How long could I sit there?

I’ve read similar observations about Musk and Tiel. Even if there might be differences drawn between the reasons for silence, these stories seem to share an interest in that silence as a sign of how the founders are different from others.

One of the most interesting aspects of the Bezos story earlier this month was the insight it offered into the security apparatus he surrounds himself with, particularly his instruction for Gavin De Becker “to proceed with whatever budget he needed to pursue the facts”. There’s something oddly thrilling to read this, inviting us to imagine that we too had unlimited resources which could be brought to bear on the righting of wrongs. But the fact this relation exists to this category of service providers is itself interesting.

De Becker was apparently a leading figure in modernising the security industry, moving it beyond ex-military personal (who presumably still have a role, at least if descriptions of the entourage Zuckerberg sometimes travels with are accurate) into what appears to be a more ‘full spectrum’ approach to the security of his clients. But even if De Becker seems to be an interesting chap without any reals sins, it’s hard not to wonder who else inhabits this space. I’m particularly curious about the murkier and more opaque areas of it, with the possibility that ‘fixers’ can now be hired in a modernised manner as if they were providing any other services to the rich and famous.

My notes on Davies, W. (2017). Elites without hierarchies: Intermediaries,‘agency’and the super-rich. In Cities and the super-rich (pp. 19-38). Palgrave Macmillan, New York.

Who are the super-rich, and what do they want? This is the question which a thought provoking paper by Will Davies begins with and it’s one which has preoccupied me in recent years. Our statistical understand of the super-rich has increased in recent years but this increased knowledge leaves a range of sociological questions which need to be addressed:

What do they want to do with all that money, other than protect it, grow it and pass it on to their children? Do they want political power, and if so, of what kind and to what end? Or do they employ it culturally, to achieve their own modes of Bourdieusian distinction from the other 99.9%? (pg 2)

For a Millsian approach to elites, the question is which political, cultural or military  institutions are they gravitating towards in pursuit of power? For the Marxist approach, it’s a question of shared interests, their collective consciousness of them and self-organisation in pursuit of them in relation to other classes, as well as the tools of exploitation leveraged in this process. Davies agrees with Mike Savage that these aren’t necessarily the right questions, summarising his argument that we need to take money seriously as money (rather than assume it is waiting to be converted into power, with the assumption elites are intrinsically political) and must adequately describe capital before we can theorise it (rather than apply pre-existing categories to incomplete or outdated descriptions of our object).

What is this object? Is it a class? Is it a group? To what extent is it open or closed? To these challenges Davies adds another one: “the need to avoid wholesale methodological individualism, while recognising the deeply personal and individualised nature of the relationships and strategies that appear to structure the lives of the super-rich” (pg 3). Piketty’s contribution is to reorientate analysis way from the labour market and towards the family. But this is difficult because knowledge is partial and the super-rich is secretive. In order to addresses these challenges, Davies suggests we study intermediaries: agents working on behalf of the super-rich who represent their interests. By focusing on agency, in the sense of one party being contracted to represent the interests of another, it is possible to response to Savage’s challenges and move the study of the super rich forward.

He draws on Simmel’s account of money as a teleological vacuum, a pure means which extends beyond every possible use to which it can be put, connecting this to the ambitions of the super-rich. Piketty’s insight about the increasing importance of unearned wealth in the economy, as well as Dorling’s recognition of the professional classes now being subsumed into the 99%, yield a sense of the super-rich as breaking away. As he puts it on pg 6, “To break free of the bounds of culture, politics or technological limits becomes a teleology in itself, the same anti-teleology that Simmel identified as the metaphysical nature of money”. This is tied to a phenomenology of valuing money as “a state of arbitrariness, where money can be experienced as perfect liquidity, without friction” and “extreme form of negative liberty that lacks all normative restraint and relationship only to the future” (pg 16).

The problem of agency is key if we wish to avoid taking this analysis too far, with their insulation depending on the capacity of agents to represent the interests of the super-rich to the wider world. He summarises this as a theoretical approach on pg 8:

In this spirit, I want to propose a theoretical device which may help to shape a sociological approach to the super-rich – principle-agent problems. In particular, I suggest that we can think of the relationship of the super-rich to domains of power, culture and production as a series of principle-agent problems, in which they seek a form of representation which absolves them of the need to become involved in matters of public concern or controversy.

Principle-agent problems rest on the “paranoid methodological individualism” associated with game theory, with the primary challenge being to ensure the agent does not use their position to pursue their own private interests rather than those of the principle they are representing. Interestingly, this is the rationale for stock options for executives, theoretically encouraging them to act in pursuit of shareholder interest by making them a shareholder. But as Davies notes, the fact executive renumeration has risen more quickly than the stock market suggests it actually makes the agency problem worse.

This ties to a broader ambiguity about their position, as “symptoms of the deep-lying ambiguity surrounding the corporate form generally, which is neither a piece of private property nor a political association, but flips from one to the other as it suits” (pg 9). Training as professionals has been one solution but managers lack the monopoly over a specific domain of knowledge typical of professionals and their connection to the public interest is tentative and contestable. Techniques such as edit and credit rating were introduced to address this ambiguity but this introduce their own problem of agency, at least if the rating agency is paid by the company it rates.

This sociological reframing of the principle-agent problem “is a particular way of
representing the interface of politics and economics” (pg 11). If I understand him correctly, economics is insulated from politics by outsourcing normative evaluation to agents; capital can float free of controversy because the evaluation, justification and debate takes place at a distance through the mediation of ratings agencies, auditors, central bankers and policy makers. It is a form of “moral under-writing – declaring that activities are transparent and trustworthy, sometimes when they are not” (pg 15). The same analysis can be applied to the growth of family offices whose purposes is to “save super-rich families from having to engage in public situations (getting a child into a school, handling tax, booking a restaurant table, managing property) which may involve any form of antagonism” (pg 11). Whereas professionals once anchored capital in the public sphere, now they facilitate its escape.

He uses this to make the fascinating argument that the super-rich may benefit from further neoliberalisation, but it’s unclear how actively they are supporting it. Agency in this sense allows them to avoid becoming a class-for-itself, highlighting a micro-social disjuncture between the economic and the political which prevailing concepts of ‘neoliberalism’ are unable to capture. As a project it “required considerable solidarity and reflexive self-understanding on the part of capitalists and ideologues themselves, through think tanks, lobbying bodies, political parties, philanthropic networks” (pg 14). But if I understand correctly, its success has eroded the conditions which made the is possible while also making it less necessary than was once the case. In its place, we have increasingly complex webs of “non-hierarchical, non-exploitative dyadic contractual relations” (pg 15) which often overlap within super-rich networks in which intermediaries have become full members over the preceding decades. It follows from this that the problem is not wealth corrupting politics, as much as “how wealth is kept entirely separate from politics and public life, through strategic acts of delegation, where the delegate is also a delegator” (pg 15).

From Oliver Bullough’s Moneyland pg 225-226. It’s hard not to see intimations of Elysium in developments like this:

Take Indian Creek, for example. It is a village in Miami-Dade County, Florida, which you approach through a quiet and pleasant residential neighbourhood, all groomed lawns and bungalows; where the streets lack sidewalks, but where there is so little traffic that walking on the road feels fine. Eventually, there is a bridge, with cream guard towers on either side of it, and a wrought-iron gate between them. If you try to step on to the bridge, a voice booms out of an intercom, asking your business. If you have no business there, or if your business is (like mine) idle curiosity, then you will be told it is a private island and that you must go elsewhere. To emphasise the point, there is a heavy police presence. At the last census, in 2010, Indian Creek had a population of eighty-six, which included four of America’s 500 richest people, as well as the singer Julio Iglesias, Colombian billionaire Jaime Galinski (whose base is London, but who also has homes in New York and a couple of other places), and various others, all with a combined net worth –according to the Miami Herald –of $ 37 billion. That sum is approximately equal to the annual economic output of Serbia, which has a population of more than 7 million people. Indian Creek’s police force employs ten full-time officers, plus four reserves, and four civilian public service aides, giving the community a police officer to resident ratio of around 1: 5, which is significantly higher even than that of East Germany at its most paranoid. The village is an island, so cannot be approached except by the bridge, but the police are taking no chances in protecting what their website calls ‘America’s most exclusive municipality’, and they run a marine patrol unit day and night, seven days a week. It is, in short, a moated community, where Moneyland can become real.

In 2012, one ten-bedroom, fourteen-bathroom house on the island sold for $ 47 million, making it south Florida’s most expensive ever property, according to the agents who closed the deal. The local press reported that the purchaser was a Russian billionaire. The photos of the house released by the agents show an airy, high-ceilinged mansion, modest yet enormous, with an infinity pool looking out on to Biscayne Bay, towards the sunrise. It has a dock with water deep enough for a superyacht, and is surrounded on the other three sides by the lush lawns of the island’s golf course. It bears about as much resemblance to an ordinary person’s house as a Bengal tiger does to a tabby cat, but it is simultaneously both tasteful and restrained. ‘Air flows in and out of the home like a deep, cleansing breath. In this open plan, where the line is eternally blurred between inside and out, entire walls part to allow the embrace of the refreshing bay breezes. Ceilings soar to incredible heights,’ the agents’ brief declares. But the closest you or me will get to it is standing at the end of the bridge, looking at a photo of it on your phone, while being intensely eyeballed by a policeman in mirrored sunglasses.

There’s a powerful extract in Oliver Bollough’s (superb) Moneyland talking about about the role offshore capital in inflating assets such as wine, art, cars, yachts and most of all real estate, with the latter then used to house these inflated assets. In the process it empowers a new class of fixers, helping manage this wealth at a distance and ensuring its sustained reproduction. From pg 220-221:

In Miller’s analysis, luxury real estate has become in effect a new global currency, with very wealthy people using housing in the world’s premier league of cities as a store of wealth, with the great advantage that they can then use their apartments as storehouses for all their other expensive stuff: their Monets, their Modiglianis, that kind of thing. ‘I don’t want to stereotype and say they’re all flight capital, because they’re not, but the growth in their presence is flight capital. They’re preserving capital. They’re just getting it into something for an extended period of time because they want to preserve it.’ Some 30 per cent of condo sales in large-scale Manhattan developments since 2008 have gone to foreign-based buyers, with the vast majority of them paying the full sum up front. It is a remarkable change, and one that accelerated in the early 1990s, when the collapse of communism created flight capital on a previously unknown scale –particularly in London.

One of these enablers, an information of Bollough’s, opines later in the book about the consequences of this accumulation for the elites themselves. What does it do to you? It’s a good question and one which is crucial to making sense of what I’ve come to think of as defensive elites. From pg 231:

Pichulik was funny and thoughtful about his curious career, and clearly concerned by the kind of inequality he has witnessed. That gave him sufficient insight to realise that spending his days looking at apartments worth $ 50, $ 60 or $ 70 million was doing strange things to his mind, and to wonder about the mind set of people who live their lives surrounded by that kind of luxury: ‘You wake up in an apartment like that when you pretty much command the city, and you have this sort of castle to yourself. What does that do to your life on a daily basis, just waking up with that feeling and seeing that?’

On the subject of the collapse of the tech mythology, a wonderful Slate headline succinctly conveys the significance of what is taking place: Facebook is a normal sleazy company now.  As Siva Vaidhyanathan puts it, “Facebook is now just another normal sleazy American company run by normal sleazy executives, engaged in normal sleazy lobbying and corporate propaganda”. He lists the controversies which have surrounded Facebook in the last few years and the founder’s response to them:

Over the past three years, Facebook has been outed for abusing the trust of its users, sharing personal data with third parties like Cambridge Analytica, unwittingly hosting Russian-backed propaganda intended to undermine American democracy, amplifying calls for religious and ethnic violence in places like Sri Lanka and Myanmar, and promoting violent authoritarian and nationalist leaders like Rodrigo Duterte in the Philippines and Narendra Modi in India. As these stories piled up and public trust eroded, the Times reports, Zuckerberg consistently exempted himself from crucial discussions with the Facebook security team and acted generally baffled that anyone would question his baby. After all, didn’t he just want, in his words, to “bring the world closer together?”

In contrast Sandberg initiated a lobbying operation with a particularly unseemly propaganda exercise attached to it, obviously at odds with the lofty rhetoric accompanying Facebook’s public pronouncements in the face of mounting scandal. Vaidhyanathan’s case is that the transition to sleaze is a recent phenomenon, reflecting the growing panic of a company which had formerly “made too much money to care about money and had too strong a reputation to care about its reputation”. Nonetheless, the mounting controversies are created by the platform working in the way it was designed to. As Vaidhyanathan says, “The problem with Facebook is Facebook.”

However my suggestion is that we have to recognise the collapse of the tech mythology as a distinct factor, beyond the current crisis in Facebook. There is an increasing  politicisation of Big Tech, as firms which positioned themselves as outside the normal rules of capitalism are increasingly recognised as what is driving a shift in capitalism itself. Their epochal rhetoric of disruptive innovation, bringing the world together through the power of their platforms, decreasingly obscures the material interests they embody. Without this broader collapse of the tech mythology, it would be easier for Facebook to make it through their present storm.

I’ve been thinking a lot recently about the relationship between digital technology and contemporary finance, including the vast off-shore facets of its existence and the shadow markets which (as I understand them) traverse onshore and offshore, even breaking down the distinction between the two. An interesting example of this concerns the logistical challenge involved in creating the byzantine corporate structures upon which these mechanisms depend, with ever more sophisticated methods made available to ever less sophisticated companies as one of Oliver Bullough’s interviewees puts its on pg 87 of Moneyland. As Bullough goes on to write on pg 88, “the speed and cheapness of modern communications have made creating these companies ever easier, with devastating results for the law enforcement agencies trying to investigate them”. Only a couple of decades ago, “if a crook wanted a Pacific shell company, they had to go to the Pacific to get it. Now, they can get it online from their living room” (pg 87). It’s easy to pass over this quickly as a contingent detail but I think there’s something extremely significant to dwell on here.

From Moneyland by Oliver Bullough pg 101. As he points out, the logical end result of this is the creation of dynasties so that privilege persists and grows, as opposed to slowly diminishing over generations.

Wealth-X, a consulting company that maps the movements of the super-rich as if they are wildebeest, calculates that in 2016 there were 226,450 people in the world with assets worth more than $ 30 million (it calls them ultra-high-net worth people, or UHNWs), a 3.5 per cent increase on the year before. Collectively, their wealth had increased over the previous twelve months by 1.5 per cent to $ 27 trillion, which is roughly equivalent to the entire output of China and the United States added together. And the outlook for further increases is good: ‘SOLID GROWTH EXPECTED ACROSS THE ULTRA WEALTHY SECTOR,’ proclaims the company’s World Ultra Wealth Report 2017. ‘The global ultra-wealthy population is forecast to rise to 299,000 people by 2021, an increase of 72,550 compared with 2016 levels. UHNW wealth is projected to rise to $ 35.7 trillion, which implies an additional $ 8.7 trillion of newly created wealth over the next five years.’

If this prediction comes true, the planet’s UHNWs will have added the equivalent of the GDPs of Japan and Germany to their stock of wealth, in half a decade. Wealth-X sells its insights to the global class of lawyers, bankers and professionals that manages this wealth. The more wealth there is, the more they get paid. They have moved on from simply de-embarrassing assets, and now husband them, protect them, multiply them, and make them available to anyone who needs them anywhere in the world. The world has come a long way since that first elaborately organised eurobond drilled holes in the tanks of the great oil tanker of the world economy, and allowed tax dodgers and kleptocrats to make a fortune.

From Moneyland by Oliver Bullough pg 51:

Nevis prospers by renting its sovereignty to rich people who believe America is over-litigious, that women get too much money in divorce settlements, and that lawyers lie in wait for the successful. These beliefs are widespread among the rich, and Moneyland has given them the power to do something about it. Once upon a time, if wealthy Americans felt their country was over-litigious, they would seek to influence a political party to change the laws. If they felt their spouses’ divorce settlements were too generous, they could argue for legislation to be passed to change that. It might have taken a while, and it might have been imperfect, but that’s democracy for you. That process of messy compromise, of back-and-forth, has been replaced by asset protection. Instead of campaigning to change the laws, they have opted out of them altogether. If you’re an ordinary person, you still face the risk of litigation and divorce settlements, as American law demands. But if you’re rich enough, you can avoid US jurisdiction and tunnel into Moneyland, where your money is hidden from the rest of us.

There’s a wonderful piece in the Atlantic talking about the accumulating scandals through which “the tech industry has gone from bright young star to death star”, with increasing public knowledge leading to a recognition that “Silicon Valley companies turned out to be roughly as dirty in their corporate maneuvering as any old oil company or military contractor”. It raises a crucial question: what happens if the controversies continue to accumulate while people remain inclined to use products upon which they have become profoundly dependent? How will these firms come to be seen if widespread rejection of their business practices co-exists with widespread use of their services? As Alex Madrigal puts it, “what if the news stays bad, but the people using their products can’t extract themselves from the platforms tech has built?” It’s a fascinating question for anyone interested in the politics of Silicon Valley and we could see this collapse of the tech mythology as facilitating a repoliticisation of (big) tech: things which were successfully framed as unalloyed social goods, so obviously beneficial to society as to be outside dispute, come to be contested and debated, as well as (we hope) subject to legal intervention and the construction of regulatory regimes.

Madrigal draws a fascinating parallel with the railroad network, using the work of the historian Richard White. The hyperbole with which the internet was greeted was once matched by a transcontinental rail network which opened up a seemingly infinite vista of possibilities to Americans, expanding the scope of social life and coming to define many people’s sense of the age in which they lived. However as controversies accumulated in the face of their novel practices (particularly the formation of their monopolies and the political lobbying operations used to defend them), they came to be widely recognised as detrimental to social life and this once lauded system was increasingly despised. The collapse of the mythology surrounding them “helped create an entire political ideology: the progressivism of the late 19th and early 20th centuries”. Much as the railroads generated the richest men of the time while being the object of vast political opposition, big tech increasingly finds itself the object of resistance while its founders enjoy the fruits of the “world-historic empires” they have built. The question this leaves is how we can ensure the collapse of the tech mythology goes hand-in-hand with a reining in of the apparatus that has been built and the defensive elites who have made their fortunes from it.

I’m utterly gripped by Oliver Bullough’s Moneyland and its account of the meta-country being built through the ability of global elites to escape national jurisdictions, facilitated by an army of lawyers, accountants and wealth managers. One of the most incisive themes concerns the acceleration of this corruption and the difficulty which it creates for public or private investigators seeking to reconstruct events. Not only do investigators move more slowly than those they are investigating, they do so in a game which is rigged against them as it is much easier to hide wealth through global dealings than it is to find it from the vantage point of a particularly national jurisdiction. From pg 20:

The physicist Richard Feynman supposedly once said: ‘If you think you understand quantum mechanics, you don’t understand quantum mechanics.’ I feel the same way about the way offshore structures have warped the fabric of the world. But if this dizzying realisation sends me out of the house and away from my screen, there’s no escaping it. The building where I buy my morning coffee is owned in the Bahamas. The place I get my hair cut is owned in Gibraltar. A building site on my way to the train station is owned in the Isle of Man. If we spent all of our time trying to puzzle out what is really happening, we’d have no time to do anything else. It’s no wonder most sensible people ignore what the super-rich get up to. You follow a white rabbit down a hole, the tunnel dips suddenly and, before you know it, you find yourself falling down a very deep well into a new world. It’s a beautiful place, if you’re rich enough to enjoy it. If you’re not, you can only glimpse it through doors you lack the keys for.

The vertigo this induces can only be solved by recognising the inadequacy of methodological nationalism to make sense of the scale of this corruption, hence his notion of moneyland as something akin to a meta-country being built within the crumbling ruins of the Westphalian order. From pg 25.

Moneyland induces vertigo to such an extent that, once the idea had occurred to me, I felt dizzy because it explained so much. Why do so many ships fly the flags of foreign countries? Moneyland allows their owners to undercut their home nations’ labour regulations. Why do Russian officials prefer to build billion-dollar bridges rather than schools and hospitals? Moneyland lets them steal 10 per cent of the construction costs, and stash it abroad. Why do billionaires live in London? Moneyland lets them dodge taxes there. Why do so many corrupt foreigners want to invest their money in New York? Moneyland protects their assets against confiscation.

Why do expressions of wealth through social media attract such attention? How does something like rich kids of instagram provoke such morbid fascination in so many? In Uneasy Street: Anxieties of Affluence Rachel Sherman offers a penetrating account of the moral universe which wealthy New Yorkers have constructed for themselves, unpicking the ambivalence they feel concerning their own privilege. While materially embracing their privilege, they nonetheless feel a profound need to subjectively distance themselves from it, particularly in relation to their children.

Doing this involves distinguishing themselves from the unthinking, unappreciative, uncaring embrace of wealth and instilling the related dispositions in their children. As she writes on pg 232, “They want to be in the middle, not in a distributional sense but rather in the affective sense of having the habits and desires of the middle class”. This relies on distancing themselves from “images of ‘bad’ rich people”. These images thus serve to legitimate inequalities by helping construct ‘good’ and ‘bad’ ways to be affluent, something which was particularly pronounced among those in Sherman’s sample who had inherited their wealth. As she notes on pg 230, positive representations circulate of figures who are praised for how they acquired their wealth and how they subsequently relate to wider society:

In November 2016, James B. Stewart wrote a New York Times column in which he tried to pin down the net worth of British writer J. K. Rowling, author of the fantastically successful Harry Potter series. 1 In the piece he attributes his interest in her assets to the fact that she is “that all-too-rare commodity in the ranks of the ultrawealthy—a role model.” He continues, “Not only has she made her fortune largely through her own wits and imagination, but she also pays taxes and gives generously to charity. At a time of bitter disputes over rising income inequality, no one seems to resent Ms. Rowling’s runaway success.” What struck me about this piece, first, is that Stewart invokes two of the characteristics of the good wealthy person that I have described: Rowling is hard-working, as indicated by her upward mobility, and she gives back liberally. 2 He doesn’t mention her lifestyle, but a 2006 Daily Mail article describes her relatively moderate consumption as “a valuable and uplifting counterpoint to the circus of pointless and continuous spending” of other celebrities, and it seems unlikely that Stewart would think she was such a role model if she were perceived as an ostentatious consumer. 3

There was an excellent Vox piece recently which explored the myth of the frugal bllionaire. As Gaby De Valle summarises these representations, drawing on an interview with Sherman:

You may have heard that Warren Buffett, the CEO of Berkshire Hathaway whose net worth is somewhere around $87 billion, lives in a modest house he bought in 1958 for just $31,500. Or that Facebook CEO Mark Zuckerberg drives a stick-shift Volkswagen GTI. Maybe you’ve seen those articles floating around about how Bill Gates, who was once the wealthiest man in the world, wears a $10 watch. Or how Amazon head Jeff Bezos, who is currently the wealthiest man in the world, drove a Honda Accord for years after becoming a billionaire.

Most recently, the UK Sun reported that Michael O’Leary, the embattled CEO of budget airline Ryanair (which has been forced to cancel scores of flights amid strikes by pilots who say they’re underpaid and overworked), is as frugal in his everyday life as he is with his airline. Matt Cooper, the author of a forthcoming autobiography of O’Leary, told the paper that the airline CEO is “utterly ruthless and pathological about how much he hates spending money.”

https://www.vox.com/the-goods/2018/9/27/17907312/warren-buffett-mark-zuckerberg-mark-cuban-frugal-billionaires

These representations of admirable extremes co-exist with a broader tendency towards the normalisation of wealth. As Sherman describes it on pg 232, “lifestyles that would actually be quite expensive (including spacious homes, domestic employees, family vacations, and fashionable clothing) appear in ostensibly “middle-class” settings on television and in the movies”. I found myself reflecting on this recently in relation to the sitcom Modern Family. The family is portrayed as typical yet the grandfather is a multi-millionaire business owner while the families of his two children live a comfortable lifestyle for extended periods of time in LA on a single income.

It seems each of their houses would be worth well over a million, with the grandfather’s house being worth eight million. In the most recent season, they hire a yacht for a family vacation. These are not typical lifestyles yet they are represented in a way imbued with middleness even if they may be out of reach of most. Sherman’s crucial observation is how middle-classness in this sense is moral, defined by earned consumption within reasonable boundaries by people who are hard working. This matters for many reasons but not least of all because the defensiveness of the affluent goes hand-in-hand with this moralisation of lifestyle. Sherman writes on pg 235:

As we have seen, the people I talked with sometimes responded quite negatively to these critiques, interpreting them as personal judgments, as when high earners reacted defensively after President Obama advocated repealing high-wage tax cuts. But this tendency to feel personally affronted by public criticism of inequality also has to do with exactly the same process of attaching entitlement to individual merit. That is to say, to believe that J. K. Rowling should not have a billion dollars when other people have nothing is not to suggest she is a bad person for having the billion dollars. The distribution of the assets is the problem, not the individual behavior, disposition, or feelings—or any other characteristic—of the person holding the assets.

This feeling of being affronted fascinates me. I’m convinced it’s a subtle factor which a political sociology of elites must take seriously, though it’s difficult to pin down without using the lens of cultural sociology. I’ve been most interested in its expression by billionaires but Sherman’s superb book has led me to see that these extreme cases reflect a broader cultural sociology of defensive elites, driven by a social celebration of wealth accumulation coupled with an ambivalence about the wealthy.

This is an accusation which Jaron Lanier makes strongly on pg 134 of his recent Ten Reasons To Delete Your Social Media Accounts Right Now. Coming from someone who was less of an insider, it might seem like a rather shrill and slightly paranoid reading of the culture of digital elites. However I find it hard not to take Lanier seriously, even if what he says here would benefit from being unpacked further:

One of the reasons that BUMMER works the way it does is that the engineers working at BUMMER companies often believe that their top priority among top priorities isn’t serving present-day humans, but building the artificial intelligences that will inherit the earth. The constant surveillance and testing of behavior modification in multitudes of humans is supposedly gathering data that will evolve into the intelligence of future AIs. (One might wonder if AI engineers believe that manipulating people will be AI’s purpose.) The big tech companies are publicly committed to an extravagant “AI race” that they often prioritize above all else. It’s completely normal to hear an executive from one of the biggest companies in the world talk about the possibility of a coming singularity, when the AIs will take over. The singularity is the BUMMER religion’s answer to the evangelical Christian Rapture. The weirdness is normalized when BUMMER customers, who are often techies themselves, accept AI as a coherent and legitimate concept, and make spending decisions based on it.

It strike me that there are two things going on here which we ought to distinguish, at least on an analytical level. Firstly, there are emerging forms of techno-religion within Silicon Valley concerning the significance of artificial intelligence for the future of humanity. If we don’t take these seriously as religious forms, we risk missing the causal influence they may exercise over the organisational life of technology forms. But we need to avoid taking them too seriously and imputing a singular character to what appear in reality to be multiple, fragmented and partial frameworks of belief. Secondly, as Evgeny Morozov has powerfully argued in the last year, the AI arms race at a corporate level needs to be understood in terms of overarching systemic trends within Silicon Valley. The advertising business has a shelf life, overheads on machine learning are much lower and these firms intend to use the data they have accumulated for advertising purposes in order to pivot into providing the infrastructure for machine learning to be woven into every aspect of the social fabric. These are two distinct trends, even if they may be reinforcing through the commitment they engender towards a corporate strategy. However where it becomes interesting is if the underlying methodological assumptions begin to be contested on a political level. If a vision of the singularity currently engenders commitment to the job and provides a lens through which organisational decisions are inflected, what happens if external groups seek to hold up such centrality?

The singularity is a speculative notion referring to the point at which exponential innovation generates a fundamental transformation of human civilisation. As Murray Shanahan puts it in on loc 78 of his book The Technological Singularity:

In physics, a singularity is a point in space or time, such as the center of a black hole or the instant of the Big Bang, where mathematics breaks down and our capacity for comprehension along with it. By analogy, a singularity in human history would occur if exponential technological progress brought about such dramatic change that human affairs as we understand them today came to an end. 1 The institutions we take for granted—the economy, the government, the law, the state—these would not survive in their present form. The most basic human values—the sanctity of life, the pursuit of happiness, the freedom to choose—these would be superseded. Our very understanding of what it means to be human—to be an individual, to be alive, to be conscious, to be part of the social order—all this would be thrown into question, not by detached philosophical reflection, but through force of circumstances, real and present.

How we should interpret this notion remains controversial. My own instinct is to see this as a form of techno-religion, delineating the point at which we transcend through our technological creations. But it is also something I feel we need to take seriously in order to understand, particularly how it is a framework for the future shaped by the conditions of late capitalism. It is in this sense that I was intrigued to see acceleration so explicitly invoked as a force which could be harnessed in order to drive this innovation. From pg 44 of the same book:

The last of these options raises the possibility of a whole virtual society of artificial intelligences living in a simulated environment. Liberated from the constraints of real biology and relieved of the need to compete for resources such as food and water, certain things become feasible for a virtual society that are not feasible for a society of agents who are confined to wetware. For example, given sufficient computing resources, a virtual society could operate at hyper-real speeds. Every millisecond that passed in the virtual world could be simulated in, say, one-tenth of a millisecond in the real world. 

If a society of AIs inhabiting such a virtual world were to work on improving themselves or on creating even more intelligent successors, then from the standpoint of the real world their progress would be duly accelerated. And if they were able to direct their technological expertise back out to the real world and help improve the computational substrate on which they depended, then the rate of this acceleration would in turn be accelerated. This is one route to a singularity-like scenario. The result would be explosive technological change, and the consequences would be unpredictable.

My point is not to dispute the scientific plausibility of this but rather to ask how the notions in play come to acquire the resonance they do for those advocating and exploring the prospect of the singularity. 

To frame the commercialisation of space as being somehow related to ‘platform capitalism’ risks misunderstanding. It is certainly the case that Jeff Bezos, owner of Blue Origin, owes his wealth to Amazon but this has become a platform over time rather than being founded as one. Elon Musk, owner of SpaceX, owes his early success to PayPal, a finance platform which was purchased at great expense by a peer-to-peer commerce platform, but he is far from the quintessential platform capitalist. Meanwhile, there are other players in the commercial space industry, such as Microsoft co-founder Paul Allen and brand-for-hire Richard Branson, who have little to do with what we talk about when we use a term like platform capitalism.

Therefore what I mean when I talk about the interplanetary horizons of platform capitalism is not the commercial history of the founders of these companies, though they have accumulated their wealth over the period where platforms have become ubiquitous and tech firms have become the most highly valued commercial entities on the planet. This has certainly facilitated their development, with Bezos largely self-financing his company until recently and Musk cross-fertilising his reputation and leveraging the Silicon Valley cult of the founder to win attention, overcome incumbents and force his way into the lucrative field of state contracts. But we miss what is most interesting about the commercialisation of space if we focus exclusively on these figures.

What interests me is how the platform, as an operable business model but also a heuristic working analogically to collapse the vast array of future opportunities into specifiable strategies, frames the new phase of space travel we are beginning to enter into. This is something Microsoft co-founder Paul Allen explicitly invokes on pg 266-267 of Christian Davenport’s The Space Barons:

Allen also saw parallels between the space frontier and the Internet. “When such access to space is routine, innovation will accelerate in ways beyond what we can currently imagine,” he said. “That’s the thing about new platforms: when they become easily available, convenient, and affordable, they attract and enable other visionaries and entrepreneurs to realize more new concepts.… “Thirty years ago, the PC revolution put computing power into the hands of millions and unlocked incalculable human potential. Twenty years ago, the advent of the web and the subsequent proliferation of smartphones combined to enable billions of people to surmount the traditional limitations of geography and commerce. Today, expanding access to LEO [low Earth orbit] holds similar revolutionary potential.”

The same case is made by Jeff Bezos is in terms of infrastructure. These firms are building the infrastructure which make commercial innovation in space feasible, creating facilitates and crafting pipelines which other players will be able to use. The ambition here is vast, seeking to save capitalism from itself by moving it into space. For Musk, hope lies with Mars and the extension of technological civilisation there to move beyond the confines of a dying earth. For Bezos, we must move industry beyond Earth and preserve our habitat as the place to live while commerce, mining and manufacturing expand outwards to the stars. There is a civilisational vision in both cases, necessary to recognise even if we don’t take it seriously.

It is easy to dismiss this as hubris, the outsized dreams of billionaires with too few restraints on how they spend their vast wealth. It is perhaps more fair, even if inaccurate, if we see it as an ideological front to cover expansion into the largest area of state spending which until recently remained untouched by private commerce. But I’m increasingly convinced there’s more going on here than either explanation can recognise. Platform capitalism has interplanetary horizons which we should take seriously because they make a difference, even if they prove logistically or technologically unfeasible in the longer term. This is the frontier of how digital elites think about capitalism and its future, liable to exercise an enormous influence upon our collective world in which these figures have near untrammelled power.

My fascination with the technological fantasies of billionaires might seem like a peculiarly nerdy version of a familiar preoccupation with the super rich. However as Yuval Noah Harari observes on loc 3304 of Homo Deus, the dreams of technological salvation which the rich and powerful invest themselves in have important consequences for the rest of us because they condition how these groups orientate themselves to the existential risks which we all face:

How rational is it to risk the future of humankind on the assumption that future scientists will make some unknown discoveries? Most of the presidents, ministers and CEOs who run the world are very rational people. Why are they willing to take such a gamble? Maybe because they don’t think they are gambling on their own personal future. Even if bad comes to worse and science cannot hold off the deluge, engineers could still build a hi-tech Noah’s Ark for the upper caste, while leaving billions of others to drown. The belief in this hi-tech Ark is currently one of the biggest threats to the future of humankind and of the entire ecosystem. People who believe in the hi-tech Ark should not be put in charge of the global ecology, for the same reason that people who believe in a heavenly afterlife should not be given nuclear weapons.

As a Guardian article last year put it, “Among the tech elite, space exploration is now the ultimate status symbol“. This reflects the ascendancy of a distinct elite, with converging dispositions reinforced by the peculiar niche within which they have accumulated their wealth and power. There are cultural and biographical explanations we can offer of their preoccupations, as well as sociological ones of how these ambitions spread amongst this intensely self-referential group of elites. However it also worth inquiring into the potential consequences of this passion given the control these people have over the future direction of technological development and the opportunity costs they confront in doing so:

Musk, who founded SpaceX in 2002, is arguably the most visible billionaire in the new space race. The apparent inspiration for Robert Downey Jr’s Tony Stark character in Iron Man, Musk has become a god-like figure for engineers, making his fortune at PayPal and then as CEO of luxury electric car firm Tesla and clean energy company Solar City. Yet it is his galactic ambitions, insiders say, that really motivate him. “His passion is settling Mars,” says one.

https://www.theguardian.com/science/2016/dec/05/tech-billionaires-space-exploration-musk-bezos-branson

When pondering this stuff, it’s hard not to wonder occasionally if you’re being overly cynical, throwing sand at people seeking innovations which could transform human life. But when I hear Jeff Bezos say that “You go to space to save Earth” I feel renewed confidence this is something we ought to critique. If these investments fail then our engineering philosopher-kings have wasted countless billions of dollars pursuing the endless frontier which could have been better spent improving our life here on earth. If these investments succeed then what does this mean for those left on earth when the super-rich go to space?

In a recent article, Michael Burawoy warned about what he termed the spiralists. These are “people who spiral in from outside, develop signature projects and then hope to spiral upward and onward, leaving the university behind to spiral down”. While he was concerned with university leaders, I observed at the time that the category clearly has a broader scope than this. Reading Michael Wolff’s Fire & Fury, I’m struck by the role of spiralists within the Whitehouse who are objectively enablers of Trump while subjectively congratulating themselves for restraining him:

Still, the mess that might do serious damage to the nation, and, by association, to your own brand, might be transcended if you were seen as the person, by dint of competence and professional behavior, taking control of it. Powell, who had come into the White House as an adviser to Ivanka Trump, rose, in weeks, to a position on the National Security Council, and was then, suddenly, along with Cohn, her Goldman colleague, a contender for some of the highest posts in the administration. At the same time, both she and Cohn were spending a good deal of time with their ad hoc outside advisers on which way they might jump out of the White House. Powell could eye seven-figure comms jobs at various Fortune 100 companies, or a C-suite future at a tech company—Facebook’s Sheryl Sandberg, after all, had a background in corporate philanthropy and in the Obama administration. Cohn, on his part, already a centamillionaire, was thinking about the World Bank or the Fed.

These figures regard themselves as performing an important public service, enforcing moderation on the immoderate and providing competence in an executive characterised by incompetence. They will then be justly rewarded for this service, spiralling out of the Whitehouse and on to bigger and better things. Who could blame them for this? After all, they have spent time and energy giving to the public sector when they could have made so much more money in the private sector. This is a crucial rhetorical strategy of the spiralists: their ambition is justified by their public service but their public service is a tool of their ambition. They approach it as a means to elevate themselves, increasing their standing and seeking out new opportunities, while expecting to be praised for that which they have forsaken in the process. The ascent of the spiralists understands itself to be motivated by much weightier things than money.

In the last couple of years, I’ve spent a lot of time thinking about what I term defensive elites. This line of thought began with curiosity about the much-reported hyperbole with which some influential figures within the financial elite of the United States greeted what would barely count as mildly redistributive measures by the then Obama regime. From The Deep State, by Mike Lofgren, pg 255-256:

When Obama suggested eliminating the “carried interest” loophole so that hedge fund managers would have to pay the same federal tax rates on their income that ordinary Americans pay, Stephen Schwarzman, the Blackstone Group CEO, said, “It’s war. It’s like when Hitler invaded Poland in 1939.” 5 Pretty strong stuff, considering that Obama’s suggestion went nowhere, nor did he even push it very hard. Silicon Valley venture capitalist Tom Perkins continued with the Nazi trope, writing a letter to the Wall Street Journal to “call attention to the parallels to fascist Nazi Germany in its war on its ‘one percent,’ namely its Jews, to the progressive war on the American one percent, namely the ‘rich.’” 6 Oh, the humanity!

When acknowledged leaders within the group feel the need to ‘defend wealth’, it’s hard not to wonder how they perceive the political situation. Is it simply that hyperbole by these people is much more likely to be reported in an era of social media and camera phones? Is this an earnest impulse to ‘make the case for business’ that happens to be tone-deaf about its audience? Or could these people really be as paranoid as some of their pronouncements make them sound? Can we see a latent anti-democratic impulse in the near hegemonic discourse of ‘wealth creators’, representing a resurgence of the view that “the people who own the country should rule it” as the First Supreme Court Justice, John Jay, put it?

Given the structural trend towards the continued consolidation of wealth, it raises the question of how this paranoid streak will find expression in political interventions by these super-elites? As Paul Mason has pointedly asked, is it possible that inequality “could tilt power so far in the direction of a new hereditary elite that there is no return”? If so the political culture of those elites, particularly the affectivity in which it is grounded, must be something of great importance. These super-elites are pulling away even from the 0.1% in a manner which seems likely to generate idiosyncratic mechanisms shaping their beliefs, dispositions and world view. As Inequality.Org summarises:

It used to be that simply being a billionaire would get you into the Forbes 400 list — that was true up until 2006. No more. Our current herd of fatcats has blown past their Gilded Age counterparts to seize an even more gigantic share of the economic pie. According to the magazine, in 2014 you had to have $1.55 billion in the bank vault to make the list. That was $250 million more than in 2013. By 2015, you had to have even more: Carol Jenkins Barnett, whose wealth derives from Publix supermarkets, was too poor to make Forbes with her paltry $1.69 billion.

The hurdle continues to rise rapidly. By 2015, the wealthiest 20 people owned more wealth than half the American population. This group is where you’ll find Mark Zuckerberg of Facebook and Larry Page of Google, as well as the most successful financiers, like Warren Buffett and George Soros. But the ranks of the very top are no longer filled by mainly by entrepreneurs or even financiers who are self-made. Increasingly, they are populated by people who, thanks to several decades of regressive tax policy, have inherited their wealth; names like Walton and Koch have become common at the apex of wealth. This is the new hereditary aristocracy of means and power

What might seem to be fringe phenomena like funding third-party lawsuits come to seem rather sinister when framed in these terms. What revenge practices are emerging? How do these groups seek to exert an influence? How do they understand the moral valence of their own actions to these ends? These are the questions which I think the concept of defensive elites can be helpful in starting to address.

There’s a disturbing snippet in Naomi Klein’s latest book, No Is Not Enough, discussing the growing market for disaster-preparation amongst well-heeled elites. While it’s possible there’s a large element of conspicuous consumption at work here, amongst people who have more disposable income than things they can buy with it, it nonetheless makes for disturbing reading. From loc 177-178:

These days, luxury real estate developments in New York have begun marketing exclusive private disaster amenities to would-be residents—everything from emergency lighting to private water pumps and generators to thirteen-foot floodgates. One Manhattan condominium boasts of its watertight utility rooms sealed “submarine-style,” in case another Superstorm Sandy hits the coast. Trump’s golf courses are trying to prepare too. In Ireland, Trump International Golf Links and Hotel applied to build a two-mile-long, thirteen-foot wall to protect the coastal property from rising seas and increasingly dangerous storms. Evan Osnos recently reported in the New Yorker that, in Silicon Valley and on Wall Street, the more serious high-end survivalists are hedging against climate disruption and social collapse by buying space in custom-built underground bunkers in Kansas (protected by heavily armed mercenaries) and building escape homes on high ground in New Zealand. It goes without saying that you need your own private jet to get there—the ultimate Green Zone. At the ultra-extreme end of this trend is PayPal billionaire Peter Thiel, a major Trump donor and member of his transition team. Thiel underwrote an initiative called the Seasteading Institute, cofounded by Patri Friedman (grandson of Milton) in 2008. The goal of Seasteading is for wealthy people to eventually secede into fully independent nation-states, floating in the open ocean—protected from sea-level rise and fully self-sufficient. Anybody who doesn’t like being taxed or regulated will simply be able to, as the movement’s manifesto states, “vote with your boat.” Thiel recently has appeared to lose interest in the project, saying that the logistics of building floating nation-states were “not quite feasible,” but it continues.