GILT BY ASSOCIATION

I don’t have any special credentials as a commentator on geopolitics, but occasionally, like now, I feel obliged to have a stab at it. The current atmosphere is febrile with hideous wars in Ukraine and Gaza, the looming possibility of a re-elected Trump and an escalating confrontation between China and the US/UK axis (if one can still call it that). Making sense of the various powers, their possible alliances and the global consequences is all but impossible. What almost forces me to comment on this impossible mess right now is an event that many may regard as peripheral, almost trivial, and that is the announcement by the US government that it’s to launch an antitrust case against Apple Corp for monopolising the smartphone business. 

I’m not an Apple fan and use products of its rival Google, like the Android operating system and phone, in my everyday affairs. I’m also a fan of antitrust legislation, being an admirer of Thorstein Veblen (as mentioned in this blog several times) and the role his theories played in taming the monopolist corporations during the USA’s ‘Gilded Age’ in the late 1890s, and starting its brief Progressive Era. However that doesn’t help to quell a certain foreboding about this case, and to explain why I need to sketch my own perception of current geopolitical realities. 

I see three principal actors in the USA, China and India, three secondary ones in Russia, The EU and the IT moguls of Silicon Valley, and then the rest of the world. The next few years will be dominated by the extent to which China actually allies itself with Putin’s Russia (whose economy it supports by purchasing oil and gas) to try to overturn the post-WWII world order. Another critical factor will be whether Trump gains re-election, cripples NATO and permits Putin to threaten the EU. But the third factor, and one perhaps better understood by techies than political scientists, is the extent to which the US has a monopoly over the most leading-edge silicon chip technology, of which it’s currently attempting to deprive China, but whose material basis lies not on the US continent but the tiny island of Taiwan. Biden has stated his intention to repatriate chip fabrication capability from Taiwan to the continental USA, but the time, expense and effort involved in rebuilding all these ‘fabs’ (chip fabrication factories) is something few really appreciate. And China has of course long ago stated its own intention to eventually grab Taiwan.

So finally I arrive at the punch line. The founders of the Silicon Valley tech revolution were nearly all inclined (even if only peripherally) to the 1960s counterculture, and though their corporations have since grown into unprecedented wealth – greater than that of many small countries, and able to exert pressure even on the US government – most have remained pretty much on what Americans describe as the ‘liberal’ wing of politics, leaning toward the Democratic Party (and yes I am aware of the big exceptions like Elon Musk, Peter Thiel and Robert Mercer). The nightmare scenario would be for this antitrust case to turn Apple toward a renewed Trump presidency, catalysing a similar shift throughout the whole sector, merging their interests with an authoritarian state and creating the basis for the sort of techno-feudal plutocracy that’s been prophesied (and criticised) by many leftwing commentators like Yanis Varoufakis and Evgeny Morozov.

Social Democracy Uber Alles

The outcry over the revoking of Uber's London licence shows that the service it provides is popular, and it's unquestionably a significant, innovative use of new technology to improve transport. On the other hand the outcry from drivers about lack of benefits and job security show that the application of technology is being used (not uncommonly) both to increase exploitation of the labour force and to flout legal regulation designed to protect labour and customers. The outcry of Black Cab drivers against Uber ignores the fact that people flocked to Uber not merely for convenience (though that is considerable) but because Black Cabs had priced themselves out of the market with the last big price hike.

Put all this together and it's clear that all the parties need to get together and find a workable solution, which is highly unlikely to happen because of the vastly different political atmospheres between UK and USA, and a general lack of adult leadership on both sides. I can imagine a system where Uber's technology is used, within a revised legal framework that brings in Black Cab drivers too. Uber would have to give up predatory pricing and recognise its employership, while Black Cab drivers would have to slacken their monopoly. And pigs would have to mount flying unicorns.

Amazon, Google, Facebook, Uber and the rest have built a worldwide, highly effective infrastructure of the sort that socialists (especially Stafford Beer) used to dream about - but unsurprisingly, as private enterprises, they use it to generate mega-profits for their owners and to erode working conditions and pay for their workers. The challenge for social democrats - which few are thinking straight (or even talking) about - is to devise new reforms that will make this infrastructure work better for the public interest, without destroying it or crushing its ability to keep innovating.

Tax avoidance by the big tech companies is certainly a major issue, and getting them to pay anything at all would be a step forward, but punitive taxation is not a solution either. Similarly with ownership, old-style nationalisation is unimaginable, unaffordable and might in any case stifle innovation. As for regulation, we need to grasp in precisely what ways the new connectivity renders many older forms of regulation ineffective, and modify them to the new reality. In fact we need to rethink a whole complex of now-inseparable issues - benefits, universal basic income, employment rights, taxation, public v private provision.

Not convinced? Then remember for a moment all those billions of pounds from the public purse that have been wasted over the last 50 years on failed NHS and other public IT projects. Now try to imagine how technology like Amazon/Google/Facebook's would help the NHS with appointments, record keeping and sharing, even diagnosis...

No parties that I'm aware of on either side of the Atlantic are thinking seriously about these matters in sufficient depth and urgency. In the USA the sheer incompetence of the Democratic Party has put the Republicans in a position not only to erase what remains of New Deal social democracy, but also to salt the earth against any possibility of its regrowth. In the UK social democracy has fallen down the crack that runs down the middle of the Labour Party, between a Right that remains wedded to neoliberalism, and a Left often hobbled by nostalgia (not always conscious) for state socialism. Not until Jeremy Corbyn starts calling himself a social democrat rather than a socialist, can you be sure that the party has remembered the difference.