Metanomics Transcript Jan 27 2010

METANOMICS: DOUGLAS RUSHKOFF OF FRONTLINE'S DIGITAL NATION JANUARY 27, 2010 ANNOUNCER: Metanomics is brought to you by Remedy Communications and Dusan Writer's Metaverse. ROBERT BLOOMFIELD: Hi. I'm Robert Bloomfield, professor at Cornell University's Johnson Graduate School of Management. Today we continue exploring Virtual Worlds in the larger sphere of social media, culture, enterprise and policy. Naturally, our discussion about Virtual Worlds takes place in a Virtual World. So join us. This is Metanomics. ANNOUNCER: Metanomics is filmed today in front of a live audience at our studios in Second Life. We are pleased to broadcast weekly to our event partners and to welcome discussion. We use ChatBridge technology to allow viewers to comment during the show. Metanomics is sponsored by the Johnson Graduate School of Management at Cornell University and Immersive Workspaces. Welcome. This is Metanomics. ROBERT BLOOMFIELD: Welcome to the 2010 season opener of Metanomics. Our guest today is Douglas Rushkoff, a correspondent and writer of PBS Frontline's upcoming documentary Digital Nation, a long-time observer of technological trends, especially in the digital age, and author of many books including the very timely Life Incorporated: How the World Became a Corporation and How to Take It Back. Douglas, welcome to Metanomics. DOUGLAS RUSHKOFF: Hi. Good to be with you. ROBERT BLOOMFIELD: Yeah, it's great to have you on. I only mentioned a few of your various endeavors. I know one of them also is that you are a tech correspondent for the Daily Beast, and, before we jump into Digital Nation, I know that just today you wrote a column on the new Apple Tablet. So care to go on record on a projection of how that'll work out? DOUGLAS RUSHKOFF: Well, in the long term, I think the way it'll work out is that it's going to undermine the Macintosh system. I mean the interesting thing to me is how they really are choosing to use the iPhone system and the iTunes world and the AppStore for pretty much everything they do now, and that's because it's a nice closed universe compared to the Mac where you could put anything you want on it, getting it from anywhere. So to me, it's sort of like Apple is playing HBO to Google's free television, where one world is sort of ad-sponsored, and you get everything you want, and the other world you pay for, but you've got to stay inside the walled garden. So I'll be interested to see just how high up on the chain this iPhone and iPhone-like operating systems go and whether someday the iPhone App or the iPhone OS might do to the Macintosh what the Macintosh did to the Apple II. ROBERT BLOOMFIELD: Interesting. Interesting. So we'll probably come back to this topic later, as we talk about businesses, corporations and brands. But before we dig into that, let's talk about the upcoming airing of Digital Nation and get the plug in first. It airs on PBS Tuesday, February 2nd at 9:00 P.M. and, of course, we're delighted to have you on not only our opening show of the season, but also really the last opportunity to hear from you before the show airs. 1

I'd like to start by asking you about what really seems to be a fairly experimental aspect of Digital Nation, which is that it's not just a television documentary, but it's integrated with a website that has been up long before the show airs, and I understand you're going to keep it up after as well. So can you talk about how you use the website and integrated that with a traditional documentary? DOUGLAS RUSHKOFF: Yeah. Well, I guess it's an innovator for PBS, you know, movies with websites developing alongside them, as long as there's been a web. But, yeah, for PBS or for Frontline, for one of these more traditional publishers, it's certainly a new thing. I mean what we did was really over the last two years we've been shooting all over the place, whether in New York or Korea or San Francisco. We always shoot hundreds of hours more on a documentary than you could stick in the movie. And what we've been doing is assembling not really the rushes but really extended pieces about whatever we're working on. So when we went and we saw Philip Rosedale at Second Life, we shot the offices and extended interviews with him and a whole bunch of different stuff. So then we ended up putting sort of a piece together on VR or Second Life simulations and then have people comment and then have people from the public making their own stories and uploading them to this website and trying to take each month or so and create a kind of a different inquiry so that we can share sort of the question that we're asking with the public at the same time that the public can share with us sort of how they look at that question or how they're answering it. So it led to a lot of really great material for us. We were asking about sort of the generational differences between the way people approach new media. And then we end up getting a post, uploaded a video post from this site called Feed Me Bubbe, which is this great 88-year-old woman or so, who's got a cooking show on the web, and her grandson Avrom. And it was interesting enough, and then we end up going out to where they live in New England and shooting this segment with them, both for our site, and it ended up in the show. So on the one hand, it was a great way to get to make a hundred-hour movie instead of this hour-long or hour and a half-long movie that we made. On the other hand, it was this nightmare because we just made a hundred hours of film. So it was a hell of a lot more work than it would have been otherwise. But it was a way to have something that really had not just a real participation from the audience, in terms of the website, which is something great in itself, but it created, really, a third character in the movie. It really allowed the public to have a voice in what it is. So it's not us telling America, "This is who you are. You are in a digital nation." It was more kind of our digital nation telling us who they are, feeding us the stories that they wanted to see covered, either about themselves or about people they knew. We followed some World of Warcraft gamers from their home where they played it in New York out to we ended up going out to BlizzCon, which is the Warcraft kind of convention because we were following them, and they were saying, "This is where you get to see the real gamers. You got to see it." So it was, in some ways, a terrifically passive filmmaking experience when we let our subjects drag us around and suggest to us and show up on our doorstep in a way that they really wouldn't if you're doing a traditional film inquiry. ROBERT BLOOMFIELD: And how about after the show, will this sort of community participation continue? DOUGLAS RUSHKOFF: Oh, yeah. There's some community participation in that people will still be able to upload what we're calling My Stories or Your Stories, videos and things that go to kind of a special YouTube channel that's on the site. And what I'm going to be doing, and I guess this is going to be the main thing I do this year now is, I'm going to be hosting a series of monthly roundtables, kind of the old--remember Harper's Magazine? I don't know if they still do them, those roundtables, where they all invite like eight really smart people in a particular area and have them discuss a particular issue. So what I'll be doing is, over the course of a month, I'll be moderating a conversation between some of the experts or the involved players in a particular question, like "Google and China" or "Is the attention span getting shorter." I want to do a unit on moral games, this whole idea of games with better teaching ethical values, something on social networking or kids in media. Each month to have this moderated 2

conversation that's going up each day as people are posting to it. And then it would also be a little bit like the old--remember Feed Magazine, Steven Johnson's website in the early '90s. It would have a threaded conversation from the public alongside it. So the idea is that, like on the left or in the center is going to be this one column going down, and then almost like a Talmudic commentary, people will be able to comment on what the roundtable participants are saying and even then comment on what other commenters have said about that. So it'll be these sort of threaded responses to the main roundtable responses. But then the roundtable members will be reading that and can interact directly with that. So sort of a way to create. I was thinking what does PBS have that, boing-boing, you're in Gadget or any of the many, many, many places that are doing great technology coverage, what does PBS have that they don't, if anything. And I think what they've got is that name PBS. And, with that name PBS, I think we can get people to come to the table, who might not participate in many other things. PBS still has that sort of solid Bill Moyersee-like kind of name recognition so that I think we can get a Steve Jobs or someone or a Wozniak, perhaps better, to come into a conversation that we're having in a way that I probably wouldn't if I was just doing this on my blog. ROBERT BLOOMFIELD: That sounds very interesting. So I'd like to ask you a little bit; I don't want you to give so much away about the show that we all feel we don't have to watch it. DOUGLAS RUSHKOFF: You don't. The thing is, you don't have to watch it. I'm so over that. What do you "have" to do when you really "have to" now? What you have to do is TiVo the premier episode of Lost. Just do that. ROBERT BLOOMFIELD: And then next year you're going to tell us we don't have to buy your book. DOUGLAS RUSHKOFF: You don't. Well, you didn't, right? I'm still here. ROBERT BLOOMFIELD: No, I did. It's on my Kindle. DOUGLAS RUSHKOFF: Oh, thank you, but you can't take it back. No, I would you to buy my book. But I mean it's just like the way they make you write books, they want you to title books and frame them in such a way that it's almost as if your book title is supposed to say, "Your children are dying. Buy this book, or it's too late." You know what I mean? ROBERT BLOOMFIELD: Yeah. Well, it's the old, "Buy this magazine, or I shoot this dog." Right? DOUGLAS RUSHKOFF: I know. It's like come on, just read this because it's going to enrich you. Read this because it's fun. Things are too serious in our world for people to do things for other than life-or-death reasons. But, yeah. But, no, I'm happy to share anything. And, if people went to the website, they could see all sorts of stuff from the show. It's just that what I'm hoping is that the 90 minutes that we created the way it's cut together, that the experience of it is different than looking at any amount of the footage that we've already put up there. ROBERT BLOOMFIELD: So let me ask you, from your personal perspective, you're so familiar with the digital space. You've been writing books about the computer age and following it for by now we can actually say decades. DOUGLAS RUSHKOFF: Twenty-five years. Yeah. ROBERT BLOOMFIELD: What was the most surprising element of this? Is there something that you learned, where you said, "Golly, I just had no idea"? DOUGLAS RUSHKOFF: Yeah. I mean a couple of things. First, I mean, as long as we're in Second Life, I was surprised to hear Philip Rosedale say that he believes, he truly believes that, within ten years, 3

Second Life will be indistinguishable from the Real World. I don't know how many people in Second Life would agree with that or think that's even that we're close. ROBERT BLOOMFIELD: I'm guessing it takes about 20 seconds to get the responses in chat, and I'm guessing we'll get a few of them. DOUGLAS RUSHKOFF: Yeah. That one kind of shocked me that he would even go there, that he would even say that. Even if he believed let's say stretch it out to 50 or 60 or 70 years, that even if he believed that the technology would get really good and high rez and super and duper and all that, that he doesn't suspect that the human perceptual apparatus will adjust to compensate, that we'll learn how to distinguish. So it's like the first day that you hear a stereo playing. If you've never heard a stereo before, you would think that that's a real rock and roll band in the next room. You wouldn't know. And then once you've listened to it a while, you realize you can hear the difference between a stereo and a band. So I would assume that the better Second Life gets the better it will get at distinguishing between these two--someone's offering friendship. Isn’t that's sweet--the better we would get at distinguishing between it. The other thing that shocked me, there's a guy named Jeremy Bailenson, out at Stanford, who's got the Stanford Virtual Research Lab. And basically he uses Second Life to do all sorts of experiments. And one thing he found out is that, if you meet someone in Second Life and their Second Life avatar is two inches taller than you, then, if you negotiate with them afterwards, they're going to have a negotiating advantage, like a three to one negotiating advantage over you, and that's whether you do a negotiation in Second Life or whether you do it on the phone or email or something like that later, that it persists even after you're in the virtual space. So that was kind of shocking to me that it would be that much. And something else he did was something he calls the "swimming with whales experiment," where he took like five-or six-year-old kids and gave them a sort of VR experience of swimming with whales at Sea World. And then two weeks later he interviewed the kids, and half or more than half of them said that they believed they had the real experience. They thought they really went to Sea World and did it. They didn't realize it was a virtual experience. So those kind of things I guess were the things that surprised me the most. ROBERT BLOOMFIELD: For people who want to hear more about Jeremy Bailenson's research, we actually had, by now, boy, about a year and a half ago, we had his co-author on, Chris Yee, talking about a number of those studies. The swimming with whales is a new one and actually brings me, you know, it's a nice lead-in to the next question I had because my guess is that's the type of story that a lot of people will find frightening or creepy about Virtual Worlds and virtual technology, the blending of the real and the imagined. And, of course, kids can't tell the difference. Just a couple minutes ago you were talking about, "Oh, well, when you write a book, the publisher wants you to put the frightening title on." So I'm wondering, when we see Digital Nation, to what extent is it going to be one of these "Your children are in danger" shows? Are there stories you personally find worrisome? Someone is correcting me: Nick Yee, not Chris Yee was on. I knew that was wrong at the time I said it. Nick Yee was on the show. DOUGLAS RUSHKOFF: Well, it's tricky. We were just actually having this discussion, me and Mark Bauerlein and Jeremy Bailenson, beginning the first roundtable in this other space. And both of them said that they felt a little scared, after the movie. And Jeremy Bailenson actually went through the movie and timed how much positive stuff that was being said about the net versus how much time was being spent saying negative things about the net. And he said that they were roughly equal. And then Mark Bauerlein, who's actually an English professor, who's been looking a lot at whether the internet makes us dumb or smart. He wrote a book; I think it was called The Dumbest Generation or something, of course, equally aggravating. And he said that it's that we react to negative information differently. You kind of remember it. So if we spend twenty minutes in Korea, looking at pro gamers and all this really fun stuff, and then five 4

minutes looking at one tragically addicted video gamer who's going to a special camp to try to get free of this addiction. And he can't move his hands, and his eyes are all screwed up. Those kinds of images, the kind of negative ideas sometimes stay with you more. So it's hard that way. And plus, you know it is PBS, and the whole context of PBS sometimes feels like, oh, concerned parents, that PBS is sort of like TV that's supposed to be good for you in a world where everything else is bad for you. So there's almost that expectation. But, no, the thing that makes it frightening sometimes, I think, is the sense of inevitability. In other words, we know that this is happening. We know we're becoming more and more digital. We know that going online is no longer a thing that somebody does; it's a way somebody is. We've gone from logging on to always on, and it's disconcerting, especially when we really don't have any good research on what this is doing to us and what it does to our brains, what it does to us socially. When you look back, we don't even have any research, good research, on what television does to us. It was never really done. We've got great information, great data on how to influence people with television or the effect of beer commercials on kids or the effect of particularly violent shows on whether kids get violent afterwards, but Marshall McLuhan, the great media theorist, said, "Why can't we just do an experiment where people look at blank screens that are on?" He wanted to know what's the effect of the TV itself, you know, this thing flashing at 60 hertz, with scan lines: What's the effect of that on the brain? How is that massaging or changing our neurology? And there's never money for that. There is money, and that's what we went and looked at, there's money the Military is spending to look at how to relieve stress that comes up in the pilots who are flying drones over Afghanistan or how to get kids to join the Army, by playing video games. There's research by companies in how to get people to buy stuff or in the short-term effects of certain colors or experiences on how much a person will spend. And the fact is, the places with the big money, the places that are doing the most work are not generally the places who are just looking for kind of out of an academic or socially beneficial set of priorities; they're looking either how to make money or how to influence people. ROBERT BLOOMFIELD: I've been looking at the chat here, and Chimera Lemon I guess first is giving some pushback on the fact that you are talking with Bauerlein and saying there also--I guess there is research on some of these issues you've just mentioned. Chimera, if you'd type in, maybe elaborate on that, that'd be great. And, Douglas, I'm not familiar with Bauerlein. Could you give me maybe just your take on his overall perspective? DOUGLAS RUSHKOFF: I mean Bauerlein is sort of more the traditionalist. He's an English teacher, and he noticed lots of behaviors and abilities that his kids seemed to be lacking. And there has been some measurement on this, that people's ability to do more contemplative tasks, to do reflection, to do deeper sustained thinking has been going down. And there is some correlation between the amount of net use or net exposure someone's had, and this. But, again, you can't necessarily blame the net. If someone's spending time with Facebook, for example, a lot of time, or growing up with Facebook, that's not just the net. Facebook is a particular application developed by particular people with particular interests. Facebook is, it's real goal is to figure out how to monetize human relationships, and it does that by generally reducing human relationships to their affinities or the products they like or the bands they like or whatever it might be. I'm not saying this in a negative way or in a judgmental way, just that Facebook is a particular thing so you can't look at it as if that's the net or that's a piece of technology. This is the effect of the computer on a kid. What we're looking at is a much larger ecosystem of interests. So we could say that's the effect of marketing on a kid, or that's the effect of a company trying to monetize something on a kid. They just happen to be using the computer to do this. So a part of the reason there's so little research, I mean there's really only one that we found was one guy who was actually looking at the effects of the computer on the brain, and that was--what the heck is his name--this guy at--was it [Cliff Mannes?] at UCLA. And he stuck people in an MRI machine, and he was like, "This is your brain on Google. This is your brain reading." And what he found was that more areas of the brain lit up when a person was doing a Google search than when a person was reading a book. 5

And then the headlines that came out after that, and talk about negative versus positive, were very positive that Google makes you smarter. Look. More of your brain is being used. And he kept coming back and trying to say in every interview, "I didn't say Google makes us smarter. All I'm saying is that the brain is working harder when you're on Google because you're both reading and you're making decisions about what to click on and where to go and what to do next. That doesn't mean better. It doesn't mean worse. It just means different." And it's like it seems to be impossible to discuss these things without either making value judgments ourselves or hearing value judgments in what people are saying. I interviewed a kid in the show, and the kid said, and his teacher said, that most of the people--and these are MIT students--they currently no longer write papers with sustained logic, that the papers they write tend to be paragraph by paragraph by paragraph. So they write one paragraph, and then the next paragraph is another great paragraph, but about something completely different so that they no longer have a connected narrative through all those paragraphs. Now it's impossible for me to say that without people thinking I'm saying, "Woe is me. Our kids can no longer write a sustained narrative." ROBERT BLOOMFIELD: Yeah, kids these days. DOUGLAS RUSHKOFF: Yet actually, as a writer, I can assure you many times I write articles by writing a bunch of paragraphs, and then I come back to those paragraphs and construct a narrative thread through them because I'm obligated, as a writer, to have a narrative thread because that's the convention that we're following. But not always are those narrative threads organic to the information that I'm sharing or the ideas that I'm sharing. And quite often those narrative threads are rather arbitrary and are designed more as a means of sustaining the reader's interest from paragraph to paragraphs than they are of adding any genuine meaning. Now I don't mean just to be saying, oh, I'm a bad writer or I'm a fake, but many writers do this because the narrative line is expected. I'm not saying it's necessarily true, but what if the way these MIT kids are writing is actually more consonant with some of the ways in which people think about stuff? What if this sort of impressionistic series of ideas about Emily Brontë's novels flows like a kind of Delusian construction and has an almost fractal-like cumulative effect on the reader. So not everything is a value judgment. Some things are just different. Sure, I pine the fact that I can't help it because I'm old, I guess, that people are losing the ability to contemplate or losing the time to contemplate. A lot of the kids we talked to at MIT said, "Yeah, well, someday I'll have time to actually sit back and think, but right now it's all about application. That's what I do. I want to get a job. I want to do this." That's life, to some extent. ROBERT BLOOMFIELD: That's fascinating. And I'll say, while you're talking about that, I am, of course, multitasking and looking at the chat. And Jennette Forager has found some quotes of that study by Dr. Gary Small, the neuroscientist, and we've got some people elaborating in text on Bauerlein, who, I see publishes regularly in the Chronicle of Higher Education. So I guess he's of the "kids don't work hard enough" school apparently. DOUGLAS RUSHKOFF: Well, he was certainly the biggest "woe is me" we could find, but he did make some great points. I mean he's one of the guys that's against computers in the classroom, and his belief is that we are online and connected to these machines and all so much of our day, and kids are being raised losing certain social abilities and kind of having more Asperger's-like symptoms every day, that why can't we let school be this sort of refuge from this stuff. Why do we always have to think we've got to meet kids where they live? Why can't we just let school be a person-to-person live thing just a few hours a day, where they get to interact with other people? When I hear him talk, I go, "Yeah. That sounds smart." But then you get Marc Prensky on five minutes later, in the same interview setup actually, and he wrote this book about digital natives, and he sounds like I did back in '95 when I wrote Playing the Future. Kids 6

are different. They're not just short attention span. They're broad attention range. They've got abilities we don't, and we can't pine the fact that they're losing the ability to read books because they're gaining the ability to read and make video and do other things. So just watch them and marvel. ROBERT BLOOMFIELD: Since you've said we'll all remember the big negative stories, what do you see as like the most hopeful, positive story that you think we ought to remember? DOUGLAS RUSHKOFF: What, from this movie or in our [files?]? ROBERT BLOOMFIELD: Oh, actually I was thinking of Digital Nation, but if you've got a better one, go for it. DOUGLAS RUSHKOFF: I wasn't thinking so specifically, I guess. I mean the thing that leaves me positive is that, really, no matter how hard a company, whether it's a technological company, a software company or a marketing company, no matter how hard they try to make a piece of machinery or a piece of software about them, about their products, about monetizing, people invariably find a way to be social on it. That's really the story of the internet. This Defense Department communications technology becomes a place where scientists are talking about Star Trek and interesting things instead of whatever they're supposed to be doing, to the point where the Military doesn't want the thing anymore. AT&T didn't even want it. They offered it to them basically for free. AT&T didn't see a use for it because people were just having so much fun just engaging with each other. And what I keep seeing is, you look at World of Warcraft or anything, and you see, by hook or by crook, people end up using it just to find other people and to express themselves and to try to broaden what it means to be a human being. So that's, for me, the repeated message that I kept getting in making this stuff is, it was really when I was looking at the supposedly darkest, "worstest" stuff is where I saw the human spirit kind of alive. And it seemed to me really indefatigable, if you will, that almost every--I went to ITP, which is where I teach sometimes. It's part of New York University, the Interactive Telecommunications Program. And you look at what the next generation, I mean kids in their 20s are actually making and the software, the devices, the things that they're designing are invariably designed to reconnect people to the Real World. There was this one guy--I don't think it ended up in the movie actually--he made a giant map of the world, and he had this blood bag over it. And, what he would do is time out a decade, and then he would put this thing that was basically plotting a chart over the map. It would drop like a droplet of blood in each location where there was violence or a terrorist act or an act of war, and it created this just smear of blood across this map. Of course, most of it ended up right in the Middle East, and there was a big pocket in Bosnia. But it was so real, what most of these kids seem to be doing were-- Kids who were raised in a Virtual World, kids who were raised in a mediated reality, looking for ways to reconnect to the real, to express whether it's the number of bumps they feel on their bicycle on their way to school or the number of people that have been killed in violent acts over a certain period of time, it encouraged me that this is not a generation that's going out into the ether, but one that, if anything, is going to help reconnect us to the real. ROBERT BLOOMFIELD: Interesting. Now I haven't been studying digital culture nearly as long as you have and most of what I've been looking at is in Second Life. But one of the things that I've seen in Second Life and that seems hopeful to me is the economies that arise naturally in these spaces. And actually, just like you get socializing in World of Warcraft and people, as you said, searching one another out, you get entrepreneurship even in World of Warcraft, and certainly Second Life is just built for it. Your most recent book Life Incorporated, I think, in part, it's about corporations, and, in part, it's just about business mentalities even in our social lives. Have you looked much into the economies of these Worlds and people interacting with one another as businesspeople? DOUGLAS RUSHKOFF: Oh, yeah. I mean it's funny, because we were talking a little bit about it earlier, I think you get the sense that I'm kind of anti-business, and I'm not at all. I'm pro business. I'm just pro business more in the Adam Smith’s sense of pro business. I'm looking at the possibilities for a level 7

playing field, in other words for business taking place on a landscape where the laws favor small businesses and local businesses and peer-to-peer value exchange, as much as they favor value extraction by corporations. So I'm looking at the ways, say, centralized currency that we use now, the stuff we call money. I look at the ways it's incompatible with the kinds of peer-to-peer value creation and exchange that can happen in a decentralized place like the internet or even a decentralized place like the Real World. I've done a lot of historical research: who invented centralized currency and when, and why, and what kinds of currency did it replace, and what are its biases, and when did it all happen. It ended up being a true education for me, kind of a shock. It was if you woke up in a world where every single computer had the Windows operating system on it, you wouldn't know that there were once other operating systems with different biases that worked in different ways. You would just think that this is a computer, just the way we wake up and say, "Oh, this is money." At the same time that there's this terribly scarce money, which is really good for some things but really bad for other kinds of things, we start experiencing these other worlds. We start experiencing whether it's the World of Warcraft or Second Life or even just the net. We start experiencing these other place where, all of a sudden, we realize we can have other means of value exchange, just things other than that money. So if the banks aren't going to lend out enough money into existence for us to exchange as much as we need to, to work for each other and get everything we want done, are there other ways? So Second Life develops its own currency. It can't help but allow an exchange rate to the dollar because people are always going to want a buy-in rather than do whatever it is that one can do in Second Life to have money. Someone's always going to be willing to spend a hundred bucks to get their cool clothes or their dance moves or whatever it is or [their sex?] experiences. But it is still an alternative means of value creation and exchange. Even though it's in a virtual model, I think it is introducing people to the idea that you can create a different system of trust in exchange, and that's sort of what I'm really interested in. It's what I think is ultimately behind the crash of the banking system is the fact that people can create value on the net without borrowing a heck of a lot of money from the bank. In the old days, if you talked to your grandparents, they want to open a store. They want to do something in the world, you've got to go to the banker, and you got to get some money. Tell them your idea and borrow some money and run your business and hope that you can pay him back. Nowadays you really don't necessarily need to borrow a whole lot of money to start a business, and I think that's part of the problem is that was really what the dot.com fall was about. These companies didn't actually need the money. They could never get big enough to justify the amount of money that was being poured into them. So banking went to real estate and other markets in order to try to find customers for their debt. And that just kept going along. Kids here and kids there with a thousand, two thousand bucks end up scaling up real businesses and doing so without the need for all that investment capital. It's gotten to the point now where the moment that you take the investment capital, usually now is the moment that you're leaving the business. That's when you're retiring at 26 because you accept the money and move on. ROBERT BLOOMFIELD: I guess if we really wanted to stretch this, it almost sounds like you're saying the new media web media is basically right now killing traditional newspapers and traditional media, unless regulators step in and big banks protect themselves, that could happen in banking as well? DOUGLAS RUSHKOFF: You could say that. I mean what Craiglist did to the newspaper, decentralized currency could do central banking, and that would be interesting. I don't think that it has to be one or the other, certainly with money. I think that there's a tremendous need for the reinstatement of local currencies and specific currencies because these giant national, long-distance currencies are really not good for local transactions. They're biased against it. They're biased much more toward the Walmart and the Costco and big agra and things like that than they are towards a community-supported agriculture or local tutors or local manufacturing. It's what they were designed for. It's really what I write about in Life Inc. That's what it was for. 8

It's not a conspiracy or anything. Well, they were being kind of mean, but the object of the game, and this was back in the late Middle Ages, was the feudal lords were getting poor. Feudalism was dying, and it was dying because people were creating value. They were exchanging value. You were getting a middle class. It was the beginning of an economy, and they really had to shut that down and replace with a different kind of an economy, a centralized economy where the aristocracy could maintain its monopoly over land and value creation, and that's how we got corporations, and that's how we got coin of the realm. But it doesn't have to stay like that. ROBERT BLOOMFIELD: I was really interested in one of the parts of the history that you tell, the history of the corporation in Life Incorporated, and it's the part where there were a lot of merchants, and there was a lot of shipping. And you describe one of the early steps toward the development of the corporation being attempts to get some stability so that, as I understand it, before they had charters of limited liability, you would send a couple boats out, and you'd become rich when they came back in. But eventually one of your boats wouldn't come back. You'd go bankrupt, and someone else would come in and take your place. DOUGLAS RUSHKOFF: Right. ROBERT BLOOMFIELD: What I find interesting is looking at the economy, definitely the businesses in Second Life, but I think, in the web more broadly, you see exactly this type of constant shifting of who's successful. It seems very difficult for these firms to actually establish themselves in a permanent way. DOUGLAS RUSHKOFF: Well, right. I mean, in this case, I think it has to do with the fact that most of these net companies don't actually make any money. They're all kind of speculative business models, and people move from one thing to another really quickly. It's like you start an internet venture, it's kind of cool, then you try to figure out a way to make money with it. And then you kind of change what it is in order to bias it towards making money with it. And then people are like, "Oh. Screw this one. We're going to go to the next one." So you go from whatever, Friendster to MySpace to Facebook to wherever people are going to go now that Facebook has turned into everybody. And that is going to happen. I mean each time people look at the thing that has the current advantage, and they think, "Well, this is it. Now let's settle down." People are committed enough to their Friendster lists that they're never going to leave it. And, of course, they go. ROBERT BLOOMFIELD: They're what? DOUGLAS RUSHKOFF: Of course, they move on. Worse case, the new company develops a transitional app, "Click here to have all of your Facebook friends shoved into the new system." And that's the thing, that's why it makes it so hard for any company to really maintain something over a long period of time. Even a venerable company, a company like Apple. They're looking at the future, and they understand that people are already taking Mac OSX and putting it on their Dell and HP Netbooks, and so that cat is out of the bag. Ubuntu is getting better and better and looks more and more--it kind of works like a nice little stable Mac system more every day. They understand that the big money is not going to be in selling that stuff so that's why they're really moving from OSX to the iPhone as their platform. And, believe me you, the iPhone operating system is going to trickle up slowly but surely to more and more devices. And OSX will be like Unix or something. ROBERT BLOOMFIELD: Changing gears just a little bit, one of the things you talk about in Life Incorporated is, people viewing themselves like corporations and thinking about themselves as having a brand. You talk about the cult of all these self-help groups where people are very narcissistic I guess should be the word and finding whatever, whether it's the secret which you talk about one of the self-helps groups are neuro-linguistic programming, that they're really focusing on themselves as a brand or a business. I mean that concerns you is my impression. 9

DOUGLAS RUSHKOFF: Yeah. I guess well, sure, it concerns me. When I went to meetings with people who are followers of the secret and hear about what they do and how seriously they take it, that they think that the path to success is to go through magazines and clip pictures of the things that they hope to own and put them in a collage and put that over the fireplace in the house and meditate on that every day. In other words, it's as if they're working towards the McMansion or the big car and that's going to be what gets them--it's just bizarre that they seem to focus on this kind of "mind over matter" ability to change reality by exploiting quantum theory. In other words, that, if they start thinking of things differently, then the universe will slowly begin to conspire so that the car will appear for them through whatever business needs, that their business will become successful. At least the way most people seem to act on this is by just joining a new multilevel marketing scheme and then using the secret exercises in order to build themselves up. But when I look at that, when I look at okay, the secret plus Amway, and anybody can look at that and say, "Okay. The secret plus Amway, that's really silly. Those people are really dumb." But then it's like, "Well, wait a minute. What about Goldman plus real estate? What about debt-based currency plus capitalism?" When you realize, "Oh, my gosh!" The thing that we're calling a real economy is based largely on the same notions of faith and infinite growth and, you know, see it, be it, become it that some of these crazy cults are based on. And, if you go back and look, this is America. This is Frank Baum, the Wizard of Oz guy who was also a window dresser at Wanamaker, who helped come up with this kind of new Calvinist American positivism that dovetailed so well with this early capitalist way of understanding business, this kind of "how to make friends and influence people," sort of smile your way to success. That all you really need is faith in your expansion and the expansion of the economy and this almost _____ meaning of growth. ROBERT BLOOMFIELD: Yeah, you're pulling yourself up by your bootstraps. DOUGLAS RUSHKOFF: You are pulling yourself up by your bootstraps. And it can work, as long as someone else is being pulled down, as long as you're extracting someone else's value in the process, I suppose that can work. ROBERT BLOOMFIELD: On the brand side, I guess that was the part that where really I wondered. Well, I guess let me just say I see it all the time, and I often think about it myself, that as an academic I have a brand. I'm thinking when people think of Rob Bloomfield and his research, what do they think. I mean think, in the old days, we would have called it reputation. It seemed to me in the book you were pretty critical of people thinking of everything as a brand. DOUGLAS RUSHKOFF: Well, if you look at what the brand is for. The brand. And I'm not talking about communication about what you do. The brand. In the Industrial Age, in a mass-market culture, the brand is there to create a mythology about a mass-produced good, to allow it to compete with a locally-produced good. That's what it was for. So if I bought my oats for many years from Joe at the oat mill on the corner, now a big oat company in Cincinnati, who's mass-producing oats with laborers instead of with oat makers or oat experts, they need to recreate the relationship that I have with Joe, and they need to make it happen between me and a cardboard box. And the way they do that is by branding the box. You put a Quaker on the box. A Quaker's a great idea because Quakers are non-threatening. They don't really believe in anything. They have great meetings. The guys sort of smile. ROBERT BLOOMFIELD: And they're not going to punch us. DOUGLAS RUSHKOFF: Right. He's got a mole on the cheek. So now I have a relationship with that Quaker that needs to supersede the relationship with Joe. So we have all these companies and the stuff and Walmart and Costco and the whole thing happens, and now, when human beings think, "Well, I've got to compete," they think of themselves as competing with corporations, that the human being needs to create a brand in order to compete with the corporation. It's sort of the way that churches and synagogues think that they need to get hip in order to compete with MTV, rather than realizing that, "No, no, no, no. You're not in the world of hip. Hip is for people who are trying to be cool or something." Real religion, real spirituality is for people who are trying to connect or trying to let go of being cool and hip and 10

actually be human beings again. So when I see people competing to be brands, that really what I'm seeing are people competing to become something that's not human, to become this other thing, this thing that's actually alien. And, sure, some people are successful at it: Donald Trump or Paris Hilton. The better you are at it is usually the person who does nothing is the best brand. So Paris Hilton would kind of--that's why they offered her a million bucks to go teach a course at Learning Annex in self-branding because she typified or epitomized this idea that, if you're really a good self-brander, then that's all you actually have to do. You don't provide a service. You don't do anything. You are a pure brand. I mean that's what her show is about, that she couldn't do anything. ROBERT BLOOMFIELD: So I see in the chat here, Fleep Tuque says, in all caps, "Corporations are not people." And we're running out of time, but this brings me to the last thing I wanted to discuss with you, which is, here you've just written a book, sort of a cautionary tale about corporate thinking, and last week we had a Supreme Court case, Citizens United, which, in the view of many, basically said corporations are people and have free speech rights. And I'd like to get your take on that court case. DOUGLAS RUSHKOFF: Well, I mean the court case, all of this stuff is based on some really clever shenanigans by corporations during Lincoln's presidency. It's really back in the 1860s that a court clerk was probably bribed to add a note into the margins of a court decision that said the corporations get protection under, what was it, the Fourteenth Amendments, the one that basically said Black people could vote, I guess, and you couldn't discriminate against them, that that extended to the personhood of corporations. So it wasn't any Supreme Court Justice who said this or anyone who voted. It was really kind of a little error or addendum that was put in without anyone's permission. That ended up really just becoming law, and the reason they did it was because railroad companies wanted to get the rights to, you know, they wanted right-of-way through towns that didn't want them to come through so they ended up getting the rights of people. And that sort of the basic rights of personhood has been defended time and time again as that Amendment was brought up. It was used to defend Black people maybe twice and used to defend corporations 2000 times because who's using the courts. But this one now sort of elevates it. They're not just people. Now they're basically citizens. Now the idea is that the First Amendment protection was there not just to protect people's right to free speech, but to protect the sort of abstract corporation's right to use all of its leverage, all of its advantage, both in the marketplace and in the marketplace we call Congress, to say whatever it wants to. And those who are defending it are saying, "Oh, look. A corporation's not a thing. A corporation is just the people who are in it, and why can't a group of people express themselves?" And the fact is a group of people can express themselves. A corporation is not a group of people. It's not what it is at all. A corporation might employ a group of people. A corporation might be owned by a group of people. But a corporation's not a person. It never was. A corporation's not even a collective. It's not. It's seen as a legal entity, and the interests of a corporation are always, by law, because this is what they were made for, are always going to be to grow, to extract value and extract wealth from human beings and to extract value from the land, in order to grow. And their speech is always going to be about promoting that interest, and to allow a corporation to say anything else would actually be against the law. So we've created our true Cylon competitors. ROBERT BLOOMFIELD: I can't believe you said that. DOUGLAS RUSHKOFF: And they're not robots. They are virtual beasts. ROBERT BLOOMFIELD: Well, that is a great place to end because actually it's my show, I get to close with some commentary, and I'm actually going to be talking about the Cylons, so I can't believe you said that. Thank you so much for joining us, and I hope maybe we can get you on again, and I encourage our audience to tune in to Digital Nation next Tuesday at 9:00 on PBS. And, of course, you can download multiple copies of Life Incorporated, by Douglas Rushkoff, onto your Kindle or Nook. So thanks so much 11

for joining us, and I hope you'll stick around during my short commentary and chat with us after we close. DOUGLAS RUSHKOFF: All right. Thanks. ROBERT BLOOMFIELD: Thanks a lot. So we turn now to my closing commentary Connecting The Dots, which I've actually titled Cylons United. Over the last couple of weeks, my wife and I have been catching up on some important television culture. We're watching season one of the series Battlestar Galactica. Even if you haven't seen it, you've heard the basic story many times. Humans create a race of robots called Cylons who rebel and nearly destroy humanity. So think The Terminator without Arnold Schwarzenegger or time travel, at least in season one. And, if you prefer, think Frankenstein's monster. So why do I bring this up now? Well, today's discussion with Douglas Rushkoff has two themes. First, Douglas's Frontline show Digital Nation explores the wonders of the virtual ages, but sounds notes of fear of what we have in our future. And, in a similar way, his book Life Incorporated explores the power of corporations, not just in business, but in our personal lives. The issue is getting a lot of play right now because the Supreme Court has just concluded that corporations have the right to spend unlimited sums to promote their political views, in a case called Citizens United. So in light of all the heavy breathing surrounding Citizens United decision, let me point out the obvious analogy of "Cylons United," to read the popular press, corporations are Cylons, and it's only a matter of time before they rebel and destroy their human masters, or, turning back to Digital Nation, are multitasking and sexting kids, may do the same. I think the Cylons United name makes for good, sensationalist copy, but I actually see it more as a dangerous copout, and I'm going to reach into the foundations of sociology to make my point. A foundation of sociology is that individuals are agents. We have freewill agency to make intentional decisions, and we're morally responsible for those decisions. But we exercise agency in the context of institutions: laws, common practices and social conventions that are created by those who came before us. So money is an institution. Shaking hands is an institution. The digital age has created new institutions, like posting profile pictures or typing emoticons. Social mores are institutions too. So when Douglas Rushkoff talks about people seeing themselves as brands, and their neighbors or friends as potential customers or investors, we can hold those people responsible for their behavior, but we also have to recognize that their actions are shaped by the institutions that surround them. People who are concerned about corporate power need to remember that corporations are institutions, not agents. Now they're very powerful institutions, to be sure. They shape our behavior, and the people who control corporations may abuse their power, but we, as individuals, and they are the ones with agencies. When Cylons unite, we're right to fear them because they started out as tools, but they developed agencies. Corporations have not, and I argue cannot. So rather than fear them, we have to express our own agency and change these institutions. Now that's easier said than done. It's always easier to add new laws and habits than it is to shed them. People become comfortable with institutions and rely on them and fight to defend them. Psychologists talk about status quo biases. Programmers and accountants talk about Legacy systems. But however hard it is to change institutions, that's where our focus has to be. The worst thing we can do is attribute agency to our institutions. Treating corporations like Cylons simply allows us to deny our own agency and avoid responsibility for our own actions. Unlike Frankenstein or the inventors of the Cylons in Battlestar Galactica, we haven't created a monster. By pretending we have, we risk creating monstrous people who blame their own willful actions on their environment and not on themselves. So that's my two cents. Join us next week on Metanomics when we talk with Sam Driver, of ThinkBalm. Sam will be talking about his recent white papers on Virtual World technologies, and we'll take a look at some successful uses of Virtual Worlds. And then the following week, Tony O'Driscoll and Karl Kapp talk about their new book Learning in 3D. 12

Til then, goodbye, and enjoy tonight's State of the Union Address. Document: cor1076.doc Transcribed by: http://www.hiredhand.com http://www.hiredhandtranscription.org 13

Metanomics Transcript Jan 27 2010

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Metanomics Transcript Jan 27 2010 — Document Transcript