Reputations

Regarding reputation-building on the Internet, Clive Thompson writes approvingly that

network algorithms do not favor the cagey or secretive. They favor the prolific, the outgoing, the shameless.

Said another way, network algorithms do not favour the quiet or the reflective. They favour the loud-mouthed, the self-promoting, the flashy.

O brave new world that has such algorithms in it.

Believe the Opposite: Radical Opacity

I’m afraid Clive Thompson has jumped the shark. From being a witty journalist at the interesting This Magazine he now fits right in at the boring Wired Magazine. On the way he seems to have lost his sense of irony (maybe they don’t let you bring irony into Silicon Valley?) and his cynicism. As a result, he has also lost the plot. Come back Mr. Thompson!

His March 2007 article in Wired Magazine called The See-Through CEO coined the phrase Radical Transparency. Like other Silicon Valley catch phrases, it has that air of youthful rebellion, it is self-consciously ignorant of history (who needs history when all the interesting things are happening right now), and – most important of all – it imparts a feel-good sense of anti-corporate attitude to your next venture funding proposal or business plan. Because like other Silicon Valley catch phrases, Radical Transparency has about as much to do with rebellion as riding a mountain bike.

Here are some snatches from the article, and some recent events in the real world, mainly as reported by The Register – which has thankfully managed to keep its senses of both irony and cynicism – and mainly about Web 2.0 poster-offspring Google and its growing Google-hoard of companies.

"You can’t hide anything anymore," Don Tapscott says. Coauthor of The Naked Corporation, a book about corporate transparency, and Wikinomics, Tapscott is explaining a core truth of the see-through age: If you engage in corporate flimflam, people will find out.

Meanwhile, Google plays cat and mouse with regulators. Leif Aanensen, deputy director general of the Norwegian Office of the Data Inspectorate, has been investigating Google’s data retention policy:

   "We are not satisfied," he said. "We didn’t get the proper answers."

   "Our main issue was their data retention policy and the use of the data they   stored. We asked them what they were doing with the personal data – are you   creating profiles – they didn’t answer," he said.

Thompson writes: "You can’t go halfway naked. It’s all or nothing. Executives who promise they’ll be open have to stay open."

Meanwhile, Google – who make repeated references to their own "radical transparency" – are closed-mouth about the introduction of new programs.
Paying select few video producers for example:

YouTube says anyone who wants to get paid can let it know by registering an interest, but provided no timescale for when it will cough up, or what the carve-up will be.

Or will there be   advertising   on the iGoogle front pages?

   The company has not made any noises about placing personalised ads on the new   iGoogle personalised homepage, but industry observers are fairly confident it   is only a matter of time.

When it comes to openness, Thompson writes "there’s no use trying to resist. You’re already naked." How Naked? Hard to tell, because it is not easy to find out what   information   Google keeps about you.

   "Upon arriving at the Google homepage, a Google user is not informed of   Google’s data collection practices until he or she clicks through four links,"   says the section of the complaint which details Google’s alleged deceptive   trade practices. "Most users will not reach this page. In truth and in fact,   Google collects user search terms in connection with his or her IP address   without adequate notice to the user. Therefore, Google’s representations   concerning its data retention practices were, and are, deceptive practices.

   "As a result of Google’s failure to detail its data retention policies until   four levels down within its website, its users are unaware that their   activities are being monitored," says the complaint in the section alleging   unfair trade practices.

Thompson writes:

Secrecy is dying. It’s probably already dead.

Meanwhile, here’s Google being radically opaque:

ord broke this month that Google has purchased 800 acres of land in Pryor, Oklahoma. The company has yet to confirm plans for the site, but I’m betting  on a new data center rather than an amusement park (in all fairness, you can   never tell with this bunch – Ed).

Oklahoma proves a handy spot to have a data center since the state’s Governor signed a new law that affords the largest corporate energy users the right to keep their power consumption figures a secret.

Governor Brad Henry signed the energy law (House Bill 1038) just a couple of   days after news of Google’s land purchase reached the local newspapers.  Coincidence? Sure.

The lawmakers behind the bill denied having chats with Google around any legislation. People familiar with the matter, however, did note that the law proves convenient for an entity such as Google that likes to keep as much information secret as possible.

If you’re a demanding type who needs evidence of Google’s secret ways, have a  listen to head of strategic development Rhett Weiss. He presided over a party celebrating yet another Google data center in South Carolina. When asked about  Google’s water and power usage, Weiss confessed:   "We’re in a highly competitive industry and, frankly, one or two little pieces   of information like that in the hands of our competitors can do us   considerable damage. So we can’t discuss it."

What else does Google not tell us? Here’s Nicholas Carr:

“We never,” says a Google representative, “comment on who we’re talking to, who we’ve considered, who we’ve rejected. We feel that when we come to an agreement, that’s the time to make an announcement.”

So please, Mr. Thompson – exercise some scepticism. Even a little would go a long way.

The liberation mythology of the internet

Nicholas Carr of Rough Type has been reading David Weinberger’s Everything is Miscellaneous, and is disappointed. But in his disappointment he coins a phrase I really like: "the liberation mythology of the Internet".

I only reached the bottom of page nine, at which point I crashed into this passage about music:

For decades we’ve been buying albums. We thought it was for artistic reasons, but it was really because the economics of the physical world required it: Bundling songs into long-playing albums lowered the production, marketing, and distribution costs because there were fewer records to make, ship, shelve, categorize, alphabetize, and inventory. As soon as music went digital, we learned that the natural unit of music is the track. Thus was iTunes born, a miscellaneous pile of 3.5 million songs from a thousand record labels. Anyone can offer music there without first having to get the permission of a record executive.

"… the natural unit of music is the track"? Well, roll over, Beethoven, and tell Tchaikovsky the news.

There’s a lot going on in that brief passage, and almost all of it is wrong. Weinberger does do a good job, though, of condensing into a few sentences what might be called the liberation mythology of the internet. This mythology is founded on a sweeping historical revisionism that conjures up an imaginary predigital world – a world of profound physical and economic constraints – from which the web is now liberating us. We were enslaved, and now we are saved. In a bizarrely fanciful twist, made explicit in Weinberger’s words, the digital world is presented as a "natural" counterpoint to the supposed artificiality of the physical world.

There’s much more at Rough Type, as Carr demolishes Weinberger’s claim.

Pain is Good

It’s been an enjoyable day.

First Alex Tabarrok threw my book against the wall and promised to kick me in the shins if I venture near George Mason University – and sent my Amazon.com ranking up to number 3634.

Now Brad DeLong offers to "throw one of my two copies out my sixth-floor office window and to trap
Tom Slee in the Evans Hall middle south elevator for no less than
thirty minutes" – and sends it up to 2,460.

Thanks to both of them. I think.

A response to Alex Tabarrok

At Marginal Revolution, Alex Tabarrok has posted a fine review of No One Makes You Shop at Wal-Mart: I’ll be keeping this paragraph somewhere to cheer me up when I’m feeling gloomy:

Slee’s book is the best of the anti-market books: it is well written, serious, and knowledgeable about economics.  In fact, I regard Slee’s book as an excellent primer on asymmetric information, free riding, externalities, herding, coordination problems and identity – Economics 301 for all those budding young Ezra Klein’s of the world who think that Economics 101 isn’t quite right.

Very nice. But coming from his libertarian point of view, it’s not surprising he has some criticisms. Let’s skip right past the lesser ones to the Most Serious Of All:

The chapter on power is terrible, I did throw the book against the wall.  Perhaps in order to prepare us to welcome government as the deliverer of our true preferences, Slee wants to diminish the distinction between liberty and coercion.  But a true liberal should never write things like this:

…the formal structure of democracy and free markets is not enough to rule out exploitation and plunder – characteristics usually associated with repressive regimes.

If Tom visits GMU (I happen to know he reads MR) he should watch out because I shall kick him in the shins stating, "I refute you thus."

More seriously, repressive governments around the world threaten, rob, torture and murder with impunity.  Courageous individuals have died trying to escape such regimes while others have died fighting for their rights.  No matter how great are differences in wealth, it is morally wrong to equate what goes on in repressive regimes with capitalist acts between consenting adults.    

Strong stuff, and it hits home because I always thought that chapter to be the weakest in the book. But blogs are no place for mild-mannered agreement so let me try to return the kick in the shins.

Most of us see many problems of this world in shades of grey, but there are always a few issues that are starker and more elemental, which we see as black or white. The "shades of grey" issues are questions of nuance and detail – these are questions where reasonable people can reasonably disagree, where we look to modest reform to improve matters, and where we look for technical solutions. It’s the dichotomies where we stand our ground – these are the things that define our politics; they are matters of principle – it’s right vs. wrong and communication across these divides is difficult. So what are these fundamental, black vs white issues?

Karl Marx knew what he thought was fundamental:

The history of all hitherto existing society is the history of class struggles.

My brother once relayed to me a very short conversation he had in a pub with a radical feminist:

Brother: throughout history the fundamental oppression is that of one class by another.
Feminist: throughout history the fundamental oppression is that of women by men.
Imagined Next Line By Both: who else can I sit with?

Peter Singer (in "A Darwinian Left", page 8) sets out what he sees as "fundamental to the left": it is to be "on the side of the weak, not the powerful; of the oppressed, not the oppressor; of the ridden, not the rider."

Where do libertarians draw their line? It’s coercion versus liberty: the state versus markets, laws versus bargains.  That’s why a typical Cato Institute article is something like "Is the Minimum Wage Coercive?" Small wonder then, that it’s a chapter setting out to recast this dichotomy as shades of grey that makes Alex Tabarrok throw the book against the wall. You can see elsewhere in Alex’s review that this is the fundamental dichotomy he has in mind as he reads. When I talk about collective action he assumes I’m talking about government intervention in the economy because that’s where he sees me, as his ideological opposition, coming from.

It’s a mark of the success of the libertarian project that the left has bought into this false dichotomy of state versus markets. We (the left) are the victim of our own success – the post-war construction of the welfare state, the achievements of social democracy, the provision of public education, and of public healthcare. We’ve let ourselves be identified with these achievements, and so now stand as conservative defenders of the state against the market-favouring radicals. Yet things need not be so. I look on my bookshelves and see some books from the UK of the late ’70s and early ’80s: "In and Against the State", Ralph Miliband’s "The State in Capitalist Society" and so on. Those on the left have a long history of opposition to the state, and a recognition of its problems. The difference is, we on the left don’t see the state as the root of the problems. The state may be a hammer, but it’s the arm holding it we need to worry about. "The executive of the modern state is but a committee for managing the common affairs of the whole bourgeoisie" wasn’t it?.

The point of my chapter is to remind us that the state is not the sole source of coercion, and that libertarians have a blind spot to coercion in the non-state sector. In the comments section of a recent Marginal Revolution post about the Cato Institute Minimum Wage article I said "My employer requires that I follow instructions from my manager or I can be fired. Is that also coercive? Yes." and another commenter responded "No, refusing to buy future labor from you is not coercive." I can see what he or she means, but you can also see the false dichotomy here – the law is coercive, everything else is a matter of choice. Tell that to (among many many examples) workers locked-in overnight at Wal-Mart stores. Was slavery coercion? Yes, and it would surely be a stretch to see slavery as a problem rooted in the state.

Alex writes "If there were no asymmetric information, no herding, no coordination problems and so forth I guarantee that there would still be plenty of inequality." True enough, but if there were no state, no laws, no public health standards, and so forth I guarantee that there would still be plenty of coercion.

We are obviously speaking from very different points of view. Are there paths across the divide? I would suggest there are. Alex claims that I have "no appreciation that what some of us MarketThink people really advocate is civil society which includes non-profits and voluntary collective action of all kinds." Compare that assertion with Erik Olin Wright’s rather wordy but still worth reading "Taking the Social in Socialism Seriously" (PDF), which also focuses on civil society as a way out of the market/state dichotomy. Or the way in which both communitarian left and libertarian right took Jane Jacobs to their hearts. There is a phrase there (voluntary collective action) that we all seem to favour, even as some of us focus on the collective and others on the voluntary. Perhaps a focus on the possibilities of that phrase would be worth exploring.

Update: Brad DeLong links to AT’s review here (but credits the review to AT’s partner in marginal crime Tyler Cowen). The comment thread has quite a different set of sympathies!

Update 2: The other day I was pleased that my amazon.com Sales Rank was around 42,000. It is now 3634 – entirely due to the review.

42,334

That’s my book’s Amazon.com number right now. 

It’s the lowest (best) I’ve seen it in the year since publication, which is pretty encouraging. Usually it’s up in the 100,000 to 500,000 range, but a series of about three purchases this week knocked it down.

Yes, I still check it far too much.