Triumph of the Oligarchs

A new class of overlords are making their bid for world domination.

The Coronavirus has trammeled the prospects of most Americans, particularly low-income workers. But for one small group, the pandemic has proved something like manna from heaven. Already ascendant beforehand, the tech oligarchy—a relatively small number of companies, venture, and private equity funds—are riding the current crisis to unprecedented dominion over our ever-weakening Republic.

To be sure, some tech firms, including Google, have taken a hit from the weakened advertising market. But tech stock prices generally have soared as most others have lagged. Undeterred by the downturn, tech moguls continue to increase their research spending in order to tighten their already rapidly constricting stranglehold on the economy. The shift to remote work has boosted firms that facilitate video conferencing and digital collaboration like Slack—the fastest growing business application on record—as well Google Hangouts, Zoom and Microsoft Teams.

No surprise then that the tech rich are simply getting richer: seven of the ten richest Americans come from the tech sector. Apple, by some calculations, is now worth more than the entire oil and gas industry. The already obscenely rich have become richer still; Jeff Bezos alone has seen his net worth jump by an estimated 34.6 billion in the first two months of the pandemic.

Oligarchy, American Style

For these ascendant overlords, President Trump represents an insultingly inconvenient barrier to such wish-list items as HI-B visas (critical to keeping labor costs down), web censorship, and uninhibited trade with their critical business partners in China. But with the Trump Administration clearly imploding, the oligarchs now have a chance to regain control of the national agenda and attain even greater political sway than that they enjoyed under Barack Obama.

Long a major source of Democratic Party funding, the tech industry will likely find a President Biden more favorably disposed toward off-shoring to China, importing temporary foreign labor, and consolidating tech firms (to which, in fairness, both parties have proven amenable). The steady erosion in anti-trust enforcement, again under both parties, has left firms like Facebook and Google with almost unlimited power to acquire or crush competitors.

Consolidation has allowed oligarchs to gain dominant shares of key markets from search (Google) to social media (Facebook), to book sales (Amazon); Google and Apple together provide over 95% of operating software for mobile devices while Microsoft still accounts for over 80% of the software that runs personal computers around the world. In the process, the many small, feisty startups that emerging all over the country increasingly have been reduced to virtual vassals. One online publisher uses a Star Trek analogy to describe his firm’s status with Google: “It’s a bit like being assimilated by the Borg. You get cool new powers. But having been assimilated, if your implants were ever removed, you’d certainly die. That basically captures our relationship to Google.”

The Rising American Surveillance State

The pandemic has also boosted the prospects for ever greater surveillance following the model of China. Even beforehand, the tech giants, notably Google and Apple, made bold steps into capturing medical records as part of a drive to emulate what the British academic David Lyon describes as a “surveillance society.”

China is increasingly a model for intensified digital snooping. Already Google, IBM, and Apple are assisting China’s systematic use of digital technology to impose ever greater control over its citizens. Some in our academic establishment see the pandemic as proving that, in the “debate over freedom or control,” China “was largely correct and the US was wrong.” Liberal advocacy groups have even launched an ad boycott against Facebook for daring to allow something close to free speech—an unpardonable sin, it appears, in this politically correct age.

In China, with its lack of legal restraints, the threat comes largely from the government. But in America and the West generally, as leftist Naomi Klein has pointed out, the real danger comes from the oligarchs who dominate and profit from the surveillance economy. Jeff Bezos, whose Alexa has been caught eavesdropping on people’s conversations, may see this monitoring as the “beginning of a Golden Age.” But to most people it seems more like an attack on privacy and a harbinger of digital feudalism.

Read the rest of this piece at American Mind.

Joel Kotkin is the author of the just-released book The Coming of Neo-Feudalism: A Warning to the Global Middle Class. He is the Presidential Fellow in Urban Futures at Chapman University and Executive Director for Urban Reform Institute — formerly the Center for Opportunity Urbanism. Learn more at joelkotkin.com and follow him on Twitter @joelkotkin

Image credit: Illumination attributed to Limbourg brothers, Très Riches Heures du duc de Berry, June and October via Flickr in Public Domain