Amazon and the Importance of Political and Economic Democracy
There is no such thing as a good and emancipatory technology that cannot be co-opted and perverted into a power of capital. – David Harvey
Working for a technology organisation, Libre Digital, which SilenceBreaker Media is part of, you might think that it’s strange I have included the quote above, especially given the important work The FreeTech Project has done in reducing social isolation and loneliness via technology – with technology a means to an end, rather than the end itself. However, importantly, what David Harvey is referring to is the power of capital, as a process, to adapt and co-opt, with this process central to our current political economy. We can only realise the true emancipatory power of technology once we overcome the contradictions of capitalism and the power of capital. Importantly, by capital, we are referring to the following David Harvey Marxist definition:
For Harvey capital is a process in which money is employed to make more money usually through the exploitation of labor power. Harvey claims that money, land, real estate, or plant and equipment that are not being used productively are not capital.
It was recently announced that Amazon, one of the wealthiest technology companies in the world, with their CEO and founder the richest man in the world, pulled out of their second headquarters deal in New York City. I discussed this proposed deal in a previous SilenceBreaker Media article:
You only have to look at how much state money has been thrown at Amazon in the US as they searched for their second headquarters to see how important the state has been for supporting capital, financial interests and the market. Richard Wolff discusses this in detail, referring to how Amazon invited all US States to bid and ‘compete’ to be the location. Key to Amazon splitting its second headquarters was the overwhelming response and attractive bids from the States, with Amazon deciding to have their headquarters in New York City, New York and Crystal City, Virginia with the total estimated cost for the headquarters standing at $10.5 billion and crucially subsidies given by the two states and cities amounting to an estimated $5.5 billion.
Alexandria Ocasio-Cortez (or ‘AOC’), a Democratic (Socialist) U.S Representative for the 14th Congressional District of New York, inspiring people across the World with her dynamic and principled approach to politics, was central to leading the revolt against Amazon coming to Long Island City, with her tweeting for instance:
Concerns regarding gentrification and people being unable to afford housing were key to people’s worries about the move. This is based on what has happened in Seattle, the main headquarters of Amazon:
In Seattle, rents have risen 39.8 percent in the past five years (in New York, rents had started to level off in many areas, and even decrease in some last year). In Seattle, as in New York, people of color have been threatened: the black population in Seattle’s historically black neighborhood Central District has shrunk, and some highly-skilled workers from countries like India who were once courted by tech companies were stuck in a visa backlog…Long Island City in particular was already undergoing rapid development and gentrification—it was dubbed the fastest-growing neighborhood in the country—and the Amazon deal immediately had an impact: Interest in local real estate spiked in the first couple of weeks in November, and, according to the Wall Street Journal, Amazon employees were laying claim to condos prior to the official announcement. Some reports suggested housing prices jumped before the move was public, too.
Land, wealth, power and property rights are all important when considering technology and its co-option by capital. Laurie Macfarlane wrote a great article looking at the “discrepancy between high levels of wealth and low levels of productivity” with this discussion relating to the importance of property rights:
The measure of wealth used by the OECD is ‘mean net wealth per household’. This is the value of all of the assets in a country, minus all debts. Assets can be physical, such as buildings and machinery, financial, such as shares and bonds, or intangible, such as intellectual property rights. But something can only become an asset once it has become property – something that can be alienated, priced, bought and sold. What is considered as property has varied across different jurisdictions and time periods, and is intimately bound up with the evolution of power and class relations…The lesson here is that aggregate wealth is not simply a reflection of the process of accumulation, as theory tends to imply. It is also a reflection of the boundaries of what can and cannot be alienated, priced, bought and sold, and the power dynamics that underpin them.
Importantly, Macfarlane, citing healthcare and pensions as examples, shows that a country that removes the profit motive and commodification of key services – which access to technology (especially the internet) should be considered as being – and therefore socialises these services, such as health care, education and energy, would look less wealthy according to this definition:
Because these benefits are non-monetary and accrue to everyone, they are not reflected in any asset prices and are not recorded as “wealth” in the national accounts… The way that we measure national wealth is therefore skewed towards commodification and privatisation, and against socialisation and universal provision.
Value is central to the concept of wealth:
The amount of wealth does not just depend on the number of assets that are accumulated – it also depends on the value of these assets. The value of assets can go up and down over time, otherwise known as capital gains and losses.
It is important to consider the structural and ideological power central to value and wealth, with ownership central to this and productive capacity not having any central influence:
For example, rules that favour capitalists and landlords over workers and tenants, such as repressive trade union legislation and weak tenants’ rights, increase returns on capital and land. All else being equal, this will translate into higher stock and property prices, which will increase measured wealth. In contrast, rules that favour workers and tenants, such as minimum wage laws and rent controls, reduce returns on capital and land. This in turn will translate into lower stock and property prices, and lower paper wealth. Importantly, in both scenarios the productive capacity of the economy is unchanged…..While future returns to capital and land get capitalised into stock and property prices, future returns to labour – wages – do not get capitalised into asset prices. This is because unlike physical and financial assets, people do not have an “asset price”. They cannot become property.
Intellectual property rights have been central to the success of ‘Silicon Valley’, a technology hub in the southern San Francisco Bay Area of California, as technology has “facilitated the further concentration of wealth and power.” As brilliantly explained by Wendy Liu, Silicon Valley needs to be replaced, not reformed, with democratic ownership and the role of capital central to this:
The Silicon Valley model of technological development is structurally flawed. It can’t simply be tweaked in a more socially beneficial direction, because it was never intended to be useful for all of society in the first place. At its core, it was always a class project, meant to advance the interests of capital. The founders and investors and engineers who dutifully keep the engines running may not deliberately be reinforcing class divides, but functionally, they are carrying out technological development in a way that enables capitalism’s desire for endless accumulation. Consequently, fixing the problems with the tech industry requires revisiting the economic assumptions that underpin it.
Despite laissez-faire liberal state theory, David Harvey argues that the state has a central role in neoliberal systems:
In neo-liberalism it is accepted that the state play an active role in promoting technological changes and endless capital accumulation through the promotion of commodification and monetisation of everything along with the formation of powerful institutions (such as Central Banks and the International Monetary Fund) and the rebuilding of mental conceptions of the world in favor of neoliberal freedoms.
This is clear to see with the Amazon deal, where states were keen to throw money at one of the richest companies in the world to attract jobs without any clear conditions and through a lack of accountability, with this reflecting a general pattern of state aid for corporations:
According to The New York Times, American cities and states spend roughly $90 billion a year in cash and tax incentives to attract companies like Amazon. Because Amazon required each city to sign a nondisclosure agreement, citizens may never know what their elected officials offered the company.
Furthermore, AOC’s and others’ concerns related to Amazon as an organisation, given that it isn’t exactly a company with a very good track record when it comes to respecting rights of people that structurally have less power:
The company itself is rife with dubious practices. Its structure is set up such that other businesses are made to become dependent on its operations, feeding a litany of antitrust concerns and erecting a quiet monopoly. And it has been accused many times of bad labor practices, undermining unionizing efforts, and even participating with ICE to deport undocumented workers.
This obviously helps when it comes to increasing the value of assets, as discussed above, linking in with the concept of structural and ideological power. No wonder rich people are chucking money towards billboards attacking AOC for the collapse of the Amazon deal.
Technology was championed as having the potential to create a decentralised, bottom up, empowered, community driven society, but we have instead seen the concentration of wealth and power in the hands of a few very rich people. That isn’t to say technology itself is a bad thing. Technology has the power to be revolutionary. But we have to challenge the social, political, economic and ideological power structures that make this difficult to break through, where a very few rich people control some of the most powerful communication mediums in the world: Twitter and Facebook are prime examples. That involves challenging the power and role of capital as a process, it means re-examining the concept of value, wealth, and also challenging the concept of private property that is so key to such inequality and power divides. Democratic ownership of technology is key for this, and needs to be part of our counter-power structures.