Keeping The Benevolent Dictators Of Silicon Valley Honest

Predictions

from the is-that-any-way-to-build-an-internet? dept

I don’t think I’ve ever had more people send me a single blog post than a blog post from earlier this week by Rebecca MacKinnon discussing her worries about “Silicon Valley’s benevolent dictators.” It’s an interesting read that brings up some excellent points. It starts off pointing out the rather insular view many folks have in Silicon Valley about “the rest of the world” and the sort of hubris that comes out of the Valley on a regular basis. That, of course, is nothing new, and is a criticism that has been leveled at Valley inhabitants for many, many years. And, indeed, there is a “clubby” nature to Silicon Valley at times, that has both good and bad sides to it.

MacKinnon points out, correctly, that Silicon Valley-ites also tend to put blind faith into the idea that technology = freedom, and freedom = good, in a rather libertarian sense. Again, that’s been said before. But then she points out something of a contradiction in all of this libertarianism, by noting that in fighting against any government regulation while putting all our faith in technology, we actually end up with a system of “benevolent dictators” made up of the folks who control the technology we put our faith in. That is, she worries that in rejecting government regulation, we’ve approved a defacto dictatorship in the form of the companies we put our trust in. In some sense, this is channelling Jonathan Zittrain’s pessimism about what happens when those benevolent dictators turn away from benevolence.

Basically, what both MacKinnon and Zittrain are pointing out is that technology is just a tool. It can be used for good or for bad purposes, and it’s part of Silicon Valley’s hubris to assume that good will automatically win out in the end. That is, we’ve been mostly blessed, because the people putting such tools into practice are doing it for good (benevolent) reasons, but there’s always a risk that someone else will do something much worse with it. It’s a fantastic point, and one well worth thinking about, but I think the assumptions are a little bit wrong.

It’s not necessarily a blind faith that “technology” and “capitalism” are flat out “good,” but more a recognition that an expanding market tends to open more opportunities for everyone, and the end result of that expansion is good at a macro level. Capitalism tends to remove the barriers for growth, while technology (or, more specifically following Paul Romer’s thesis, “ideas”) are what then creates that growth. Capitalism is about removing the barriers, and technology and ideas are about enabling that growth. That doesn’t mean that there aren’t downsides to both — but the net gain does appear. And, one thing that has become incredibly clear throughout history is that it’s nearly impossible to take away that net gain once it appears. And, conversely, asking the government to create those net gains instead almost always fails, due to the difficulty in accurately regulating a market.

In other words, by removing the barriers and enabling the potential, you’ve almost guaranteed that when someone tries to use the tools for less-than-benevolent reasons, it only opens up strong demand for someone else to provide the equivalent (or better) in a benevolent way again. And, at the same time, in asking the gov’t to manage the benevolence, you almost guarantee less opportunities to actually provide good tools, because you’ve added hurdles they need to jump through. Yes, there can be bumps in the road — and, no, it’s not always a fun process along the way. But enabling for growth is not blind faith. And, there are plenty of checks and balances in place that should these “benevolent dictators” turn authoritarian instead, the end result (or “revolt” as the case may be) can often be strong enough to deal with it.

So, yes, there may be some benevolent dictators in Silicon Valley — but they’d be hard pressed to successfully ditch that benevolence without paying a huge price.

Related to this, I’ve recently been doing a presentation for various corporate execs (almost all from outside the US) on “What Makes Silicon Valley Silicon Valley.” It’s probably my favorite presentation, because it’s fun and it usually challenges a lot of the assumptions many people have about why Silicon Valley has been so successful for so long — that is, while it discusses some of the “common” reasons, it focuses more attention on the hidden, unexpected and accidental reasons for why Silicon Valley became what it did.

The last time I gave it, I ended up getting into a huge discussion with some European execs who pointed out that many of the explanations seem to run almost entirely counter to what many countries who try to set up their “own” Silicon Valley think. That is, many folks look at Silicon Valley and try to replicate the outward manifestations (a good university, some venture capitalists) and miss the underlying details that create the real culture of Silicon Valley, because they almost seem counterintuitive. And the most basic element of this is enabling the free exchange of ideas (that engine for growth). Instead of doing that, most focus on protecting ideas and limiting that free exchange, falsely believing that hoarding information beats sharing information (even with competitors).

So, what happens is that other countries set up their own Silicon Valleys by focusing on protectionism (greater intellectual property rules, non-competes, hugely funded labs), and ignore the power of the cross pollination of ideas and people throughout Silicon Valley, which make it that much more difficult for any single company to abuse the trust of the people they serve. Should any company turn away from benevolence, that openness almost guarantees a more open competitor shows up in return (sometimes with the same employees from the older company). That openness drives innovation, but also keeps these benevolent dictators honest.

Filed Under: benevelent dictators, capitalism, culture, economics, entrepreneurship, growth, silicon valley