Expert-Entrepreneur Merit Consensus

Tech-minded Washingtonians who called themselves the “Neo-Liberals” in the early 1980s, documented their bold thinkings. Nascent Democratic Party neoliberalism was the subject of a manifesto, an anthology, a collective biography, and countless news stories. What stands out today in their work is the distaste they expressed for organised labor and their enthusiasm for high-tech enterprises.

The 1983 Neo-Liberal manifesto, for example, blamed unions for the country’s industrial problems, mourned all the waste involved in the Social Security program, and called for a war on public school teachers so that we might get a better education system and thereby “more Route 128s and Silicon Valleys.” It was all so modern, so very up-to-date.

“The solutions of the thirties will not solve the problems of the eighties,” proclaimed a book-length account of this band of cutting-edge thinkers. “Our hero,” announced one of the leaders of the bunch, “is the risk-taking entrepreneur who creates new jobs and better products.”

Historians used to argue that the regulatory state began not with public-minded statesmen cracking the whip and taming big biz, but just the opposite—with business leaders deliberately inviting federal regulation as a way to build barriers to entry and give their cartels the protection of law. Long-ago giants of steel, tobacco, telephones, and meatpacking all welcomed federal regulation because of the effects it would have on smaller competitors. That old style of regulation brought ancillary benefits to the public, of course: better food, a standardized phone system. But its main objects were stability for existing businesses and guaranteed profits in perpetuity.

In the important 2013 book Who Owns the Future? the tech writer Jaron Lanier describes the emerging Internet giants of our time as “third-party spy service[s].” Many of them, he argues, make their profits via “the creation of ultrasecret mega-dossiers about what others are doing”; everything else they offer—retail sales, connecting with friends, searching the Internet—is secondary. Google, the liberal class’s favourite Internet company, is a case in point. They track your web searches to sell you stuff; they scan your emails to sell you more stuff.

For those who are worried about the loss of privacy such practices seem to portend, Eric Schmidt tells us—in a book cowritten with a former adviser to Secretary of State Hillary Clinton—that it’s all inevitable anyway, nothing we can do about it. In the future, they write, “by the time a man is in his forties, he will have accumulated and stored a comprehensive online narrative, all facts and fictions, every misstep and every triumph, spanning every phase of his life. Even the rumours will live forever.”

“Monopoly is the telos of innovation, the holy grail fervently sought after by every young coder sweating away in the incubator. The reason is plain enough: monopoly is the most direct road to profit, and the online world offers countless opportunities to achieve it.”

Robert Reich – close Clinton friend who became Secretary of Labor in 1993, author of The Work of Nations (1991) – wrote: all these developments in the American economic social order are “the logical culmination of a process that began thirty years ago when corporations began turning over full-time jobs to temporary workers, independent contractors, free-lancers, and consultants.”

This is atavism, not innovation. It has not reversed the trends of the last thirty years; it has accelerated them. And if we keep going in this direction, it will one day reduce all of us to day labourers, standing around like the guys outside the local hardware store, hoping for work.

On the campaign trail, Clinton had carried with him an oft-consulted copy of Reich’s magnum opus and the plan for job training and infrastructure spending that Bill Clinton announced as a candidate followed the strategy Reich outlined. Hillary Clinton returned to the Reich principles frequently, as Secretary of State and in her Presidential campaign 2016. In a high-profile speech in January of 2010, she declared that, henceforth, the United States “stand[s] for a single internet where all of humanity has equal access to knowledge and ideas.”

“Committing ourselves to defending this unified Internet from all who would censor it,” she continued, was a logical extension of what Franklin Roosevelt had been after with his Four Freedoms; it wasn’t all that much different from the UN’s Universal Declaration of Human Rights, either. To Clinton it was a matter of direct moral simplicity: open expression on the Internet equals freedom; evil regimes are those that try to suppress that freedom with things like “a new information curtain.”

Obama deferred to Wall Street in so many ways because investment banking signifies professional status like almost nothing else. For the kind of achievement-conscious people who filled the administration, investment bankers were more than friends—they were fellow professionals; people of subtle minds, sophisticated jargon, and extraordinary innovativeness. They were the “creative class” that Democrats revere.

For Obama and his supporters, there seems to be something elemental, something basic in the many showdowns between his cool, technocratic style and the raging, wailing, senseless defiance of the Republicans in Congress. Surely they believe that it’s mind against sentiment, ego against id, civilization against barbarism.

Microlending: an expression of  microfinance, which is a category of financial services targeting individuals and small businesses who lack access to conventional banking and related services. In practice it means very small loans to very poor people, generating large revenues at scale for the lender. It was touted as the solution to third world poverty and downtrodden oppression. Democratic Party grandees – especially the Clintons – advocate for microlending using a mix of economics, virtue marketing and identity politics. The moral high ground is a useful paradigm for selling virtue (at a profit).

In his 2010 book Why Doesn’t Microfinance Work? development consultant Milford Bateman debunks virtually every aspect of the microlending gospel. It doesn’t empower women, Bateman writes; it makes them into debtors. It encourages people to take up small, futile enterprises that have no chance of growing or employing others. Sometimes microborrowers don’t even start businesses at all; they just spend the loan on whatever. Even worse: the expert studies that originally sparked the microlending boom turn out, upon reexamination, to have been badly flawed. “the increasing dominance of the microfinance model in developing countries is causally associated with their progressive deindustrialization and infantilization.”

Lending to the poor, as every subprime mortgage originator knows, can be a lucrative business. Mixed with international feminist self-righteousness, it is also a bulletproof business, immune to criticism. The million-dollar paydays it has brought certain microlenders are the wages of virtue. This combination is the real reason the international goodness community believes that empowering poor women by lending to them at usurious interest rates is a fine thing all around.

Like Wal-Mart and Goldman Sachs “partnering” with the State Department, what these virtue-consumers are doing is purchasing liberalism offsets, an ideological version of the carbon offsets that are sometimes bought by polluters in order to compensate for the smog they churn out. At the apex of all this multi-billion dollar idealism stands the Clinton Foundation, a veritable market-maker in the world’s vast, swirling virtue-trade. Thus the bricks and mortar of Clinton generational wealth; at least so Bill and Hillary hope.

Worth reading John Summers’ groundbreaking essay “The People’s Republic of Zuckerstan” on the innovation cult in Cambridge, Massachusetts. It exposes one of the core tenets of professionalized Democratic Party meritocracy and its vision of a benign but totalitarian entrepreneur-expert future.