Technology Disruption will decimate Congress piece by piece
The Congress of the United States of America called 4 CEOs of big tech companies to perform a circus on national TV.
Jeff Bezos from Amazon. Tim Cook from Apple. Mark Zuckerberg from Facebook. And Sundar Pichai from Google.
These 4 CEOs were in front of the Congress being questioned and accused of monopoly.
I am a European guy. And I was shocked by what I heard and saw!
The Inequality of the Questions
Congress is the highest institution of the United States of America. They have the power to control, regulate, and drop any threat that can put their country in jeopardy.
Yet, this audition was weak, and they lost a real opportunity to make the difference.
The lines of questions from the Congress has shown how far from the reality of companies and the market, the Congress of the United State of America is right now. And this is very preoccupying.
These people should study more about these important issues. The 4 biggest companies in the world were represented in the Congress. And congressmen and congresswomen were asking about things like:
“ Mr. Jeff Bezos, are there contra-factor products being sold on Amazon? Are you making profits on this kind of product?”
I stood with the impression that all Congress wanted to “ catch “ these guys with tricky questions. I got you, Bezos! Now I can go home and wait for my paycheck.
There wasn´t a unique question about technology disruption. Any question about new ways of how can this incredible country thrives to the unknown future. With better tools to fight against real threats like China companies.
This was just a retarded group of people trying to justify their jobs. And catch these 4 big tech companies to regulate them.
If Congress starts to regulate these massive American companies, they are probably starting to destroy their own future. Facebook, Apple, Amazon, and Google are competing with the rest of the world. And Congress is making them the bad guys. It´s ridiculous.
Some of the questions were about the 4 companies buying some of their competition. Like Facebook did with Instagram, for example. But Facebook bought Instagram by $1 billion dollars. It was an acquisition. Big companies buy small companies all the time.
Congress tried to imply that Zuckerberg threatened Instagram with some letters. In these documents, Zuckerberg says they were working on a camera app that would compete with Instagram's app.
So, Facebook suggested a buy. Instagram owners had two options. Compete against Facebook or sell. And they sold.
This congresswoman interrupted Mark Zuckerberg more than once. They always do it when the answer doesn't fit in their line of thoughts. Congress knows how to do it in a very efficient way. Then she says this about Facebook:
Facebook is a case study in my opinion, in monopoly power, because your company harvest and monetize our data, and then the company uses that data to spy on competitors, and copy, acquire, and kill rivals.
The expression spy and kill makes these accusations more than criticism. In Congress, accusing a company of spying and killing, makes me wonder about the real feelings of this political person about the company. It's not a simple critic.
And for her information, companies try to be better than their competitors, yes, that's true. It happens all the time, in all sectors of the economy.
That's why Tik Tok is a strong competitor of Facebook, like other platforms and apps. And Tik Tok didn't come from the USA. It´s a Chinese company. And what is Tik Tok being accused of, right now?
Yes. Spying.
So it´s better to kill Tik Tok in the USA, for national security matters. But that's another issue. A stronger and much more important one.
The Price of Tomorrow
The difficulty with which politicians are keeping up with technological disruption is stark. And this phenomenon is happening all over the world.
Tech companies are dominating the real economy at the present time. And with the pandemic, this process is accelerating at a dizzying rate.
We all feel this shift when we call UberEat or buy on Amazon. We feel this shift when we do a call on Zoom with our collaborators on a normal working day.
Yet, non of us is understanding at what point technology is influencing us in our day-to-day routines.
Even politicians, economists, and central banks. They are not following the pace of this revolutionary trend. And they are losing this battle because we have a more inequality world as we haven't seen in almost 70 years. The last time it happened was in the Great Depression of 1929.
But what happens when we can't count on a system of growth and inflation anymore? What if a more powerful force renders most of our efforts to create inflation irrelevant? And what if, by desperately trying to cling to an outdated inflationary model, we drive more wealthy inequality, more polarization, and more discord into our societies?
Today, we are in that scenario. The continual growth and inflation we expect- the system we've built our nations´economies around- is ceasing to exist. Technology is a deflationary force so great that, in the end, nothing we do will stop it.
It took $185 trillion of debt to produce about $46 trillion of GDP growth over the last twenty years. The growth rate would likely have been negative without all of that stimulus.
Jeff Booth, in his book The Price of Tomorrow, describes these massive power- technology disruption. And nobody is seeing and understanding it, especially politics.
The power of this deflationary force is still in front of us, driven by technology at an exponential rate. Every 18 months, technology disruption doubles its rate. If it takes 20 years to generate $185 trillion in debt to fight deflation and nurture growth, then it might take that number again, but this time over the next thirty-six months or so.
That´s why Jeff Booth believes that:
Quite plausibly, to keep driving growth against an exponentially increasing technology deflation, global debt could become a number so high that the only way out of it is to hit the reset button. The truth is we have probably already passed that point at which a complete reset is required. Our technology boom will cause another kind of boom.
Technology is making things for free. But also is transforming the working force by eliminating jobs. For the next 20 to 50 years, the world´s economy is going to change radically.
Allowing abundance without the jobs is going to open up a new era where we will enjoy the benefits that technology brings.
Prices of all things will fall. But the human being is going to create value in other forms. The supply and demand are going to shift to new realities. People are going to be paid for creating innovation and new kinds of services that don't yet exist.
Right now you have a lot of apps and other services for free. Technology is doing it without our notice. And as things get cheaper and cheaper, the entire infrastructure needed to support more jobs will drop.
The trend is already telling us that a different way of living is coming.
We just don´t know at what cost will it happen.
The Ultimate Challange
Politicians urgently need to keep up the pace. Or the world is really in trouble.
Technology disruption is here to stay and thrive. There is no way to stop it. And the more we embrace it, the better.
But Congress seems to live in another dimension. With different agendas and interests. You can't have politicians explaining to Amazon CEO how should he manage his company.
Congressmen that are lawyers, that never had a company, never had to employ anyone, and that their best skills are arguing among each other. They did try to explain to the best managers the world can see, how to manage their companies. It was a sad thing to see. And dangerous too.
With this hearing, you have seen the big difference between the real economy and the politicians. And it becomes clear that Congress has no clue of what they expect to regulate. They don't know how these companies make money. How they grow and expand, and what their risks are.
Congress manages power. And these 4 big tech companies, Amazon, Google, Apple, and Facebook are too powerful right now. So, they are a threat to the power institution- the Congress.
The accusations that were presented in this hearing revealed a profound ignorance. But also showed to the public that this is about power, not a monopoly issue.
Also revealed that Congress should be spending time studying to prepare the shift of the world's economy. Not doing this kind of stingy politics against the best companies in their own country.
We need better politicians.
Or we will face revolutions and wars that will burn the existing system to the ground. Allowing that to happen seems insanely irresponsible since humanity might also forever lose the opportunity to have the kind of social uplift that is possible with technology.
But when you have the Congress chairman, Mr. Cicilline, doing this introduction on last week's audition, what will you think?
As gatekeepers of the digital platform, these companies enjoy the power of picking winners and losers. To shake down small businesses. And rich themselves by persuing their competitors. Their abilities to dictate terms, call the shots upon entire sectors, inspire fear, represent the power of a private government. Our founders will not bow before a king, nor should we bow before the emperors of the online economy.