Franklin Foer – World Without Mind - [Invest Like the Best, EP.67]

My guest this week is Franklin Foer, the author the recently published book “World Without Mind.” The topic of our conversation is one that I’ve been thinking through often this past year: the impact that large technology companies have on our minds and behavior. This conversation is only indirectly related to markets, but given that the companies we discuss are now several of the largest by market cap in the global stock market, what happens to them likely impacts all of our portfolios whether we own them or not. Given that these companies compete for our attention and dollars, they also affect our businesses. As an example, My friend Brent Beshore and his team at Adventures wrote a long and incredibly thoughtful piece on how they think about Amazon as a force in the market, and how they plan on navigating around such a fierce competitor. Franklin’s book, especially the early history, is very thought-provoking, so it was no surprise that our conversation was too. Please enjoy our talk on the tech giants. For more episodes go to InvestorFieldGuide.com/podcast. Sign up for the book club, where you’ll get a full investor curriculum and then 3-4 suggestions every month at InvestorFieldGuide.com/bookclub. Follow Patrick on Twitter at @patrick_oshag Links Referenced Free PDF of The Whole Earth Catalog Amazon Must Be Stopped (New Republic) Hannah Arendt Philosophy Time Well Spent Books Referenced World Without Mind: The Existential Threat of Big Tech The Whole Earth Catalog The Lessons of History Show Notes 1:40 - (First Question) – As part of Jonathan’s new book, World Without Mind: The Existential Threat of Big Tech, exploring the idea of the whole earth catalogue. 4:09 – The Whole Earth Catalog 4:36 – Free PDF of The Whole Earth Catalog 4:49 – What happened next for Brand and how he laid the early groundwork for today’s modern Silicon Valley 7:43 – Franklin’s personal journey into writing this book 10:00 – Amazon Must Be Stopped (New Republic) 11:48 – Thoughts on the advancement of technology in our world 15:52 - Filling the gap into Brand’s influence on Silicon Valley from the early 80’s to today 18:57 – How does the current state of the free internet without gatekeepers hold up for the next generation 20:53 – Is there a chance that technology’s unlimited mining of our attention is not the horrible thing we often make it out to be 24:47 – What are the ways we can have a free internet and other technologies, but not let them get perverted 28:09 – How will people respond to our tech monopolies 31:54 – The Lessons of History and the rise and fall of centrist powers 33:02 - A look at Franklin’s work and how its impacted by the reliant on a few large tech companies 35:28 – The dangers that tech giants like Facebook, Amazon, etc, have created for us 40:45 – Is there a technology, company, or trend that Franklin is really excited for 42:19 – Will there be movements that emphasis detachment from technology 44:05 – Why most innovations have happened to people thinking in a very separated or contemplative mode 45:58 – What’s the most exciting thing that Franklin is thinking about now 49:30 – What was the most memorable content in researching this book that Franklin would suggest other check out 49:59 – Hannah Arendt Philosophy 52:37 – Are there specific things that Franklin does to be more contemplative 53:26 – Time Well Spent 54:47 – Kindest thing anyone has done for Franklin Learn More For more episodes go to InvestorFieldGuide.com/podcast. Sign up for the book club, where you’ll get a full investor curriculum and then 3-4 suggestions every month at InvestorFieldGuide.com/bookclub Follow Patrick on twitter at @patrick_oshag

Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.

• 0:00Patrick O'Shaughnessy?

  I know firsthand how complex the tech stack is for asset management firms. And seemingly every new tool and data source makes the problem even worse, adding more complexity, more headcount and more risk. RidgeLine offers a better way forward. One unified platform that automates away the complexity across portfolio accounting, reconciliation, reporting, trading, compliance and more, all at scale. RidgeLine is revolutionizing investment management, helping ambitious firms scale faster, operate smarter and stay ahead of the curve. See what RidgeLine can unlock for your firm. Schedule a demo at ridgeline.ai.

• 0:36Patrick O'Shaughnessy?

  Hello and welcome, everyone. I'm Patrick O'Neal and this is Invest Like the Best. This show is an open-ended exploration of markets, ideas, methods, stories and of strategies that will help you better invest both your time and your money. You can learn more and stay up to date at investorfieldguide.com.

• 0:57Speaker 02

  Patrick O'Neal is a principal and portfolio manager at O'Neal Asset Management. All opinions expressed by Patrick and podcast guests are solely their own opinions and do not reflect the opinion of O'Neal Asset Management. This podcast is for informational purposes only and should not be relied upon as a basis for investment decisions. Clients of O'Neal Asset Management may maintain positions in the securities discussed in this podcast.

• 1:19Patrick O'Shaughnessy?

  My guest this week is Franklin Foer, the author of the recently published book, World Without Mind. The topic of our conversation is one that I've been thinking through often this past year, the impact that large technology companies have on our minds and on our behavior. This conversation is only indirectly related to markets, but given that the companies we discuss are now several of the largest companies by market cap in the global stock market, what happens to them likely impacts all of our portfolios, whether we own them or not. Given that these companies compete for our attention and dollars, they also affect our businesses. As an example, my friend Brent Beshore and his team at Adventures recently wrote a long and incredibly thoughtful piece on how they think about Amazon as a force in the market and how they plan on navigating around such a fierce competitor. Franklin's book, especially the early history, is very thought provoking, so it is no surprise

• 2:04Patrick O'Shaughnessy?

  that our conversation was too. Please enjoy our talk on the modern tech giants.

• 2:13Patrick O'Shaughnessy?

  This is going to be an exploration of one of my, I guess, one of the most interesting topics that I've been thinking a lot about recently, which is the role that these enormous tech companies play in our lives and the impact that they have on our minds. I love the title of your book and given the really rich history, which is not what I was expecting at the beginning of the book, was really what grabbed my attention. I was hoping we could start there and maybe I'll just pick a spot because it was something that stood out, which is for you to describe what the whole Earth catalog is.

• 2:41Speaker 03

  Right. So the whole Earth catalog was the creation of a hippie called Stuart Brand. And Stuart Brand was sitting on top of a building in San Francisco one night and he was just coming down from LSD and he sat and he stared out across the rooftops and he just kind of had this revelation. He asked himself, why, you know, the Earth is curved. Why haven't I ever seen a picture from outer space of the whole Earth? Not just part of the Earth, but the whole Earth. And Stuart Brand went around from college campus to college campus, trying to Hector people into creating, to create a movement for a picture of the whole Earth. And he became a godfather of the environmental movement in a way because

• 3:26Speaker 03

  of this. But more importantly, he was hanging out with Ken Kesey and the Merry Pranksters. And one of the totally fascinating things about Silicon Valley is that it had these two things rubbing up against one another. It was the epicenter of LSD and the Grateful Dead and was really a birthplace of, of the 1960s. And it was also the place that gave us Steve Jobs, the internet, personal computing. And I don't think you could have had one thing without the other, that innovation was actually born out of the spirit of the counterculture. So, one thing that happened in the late 1960s and early 1970s was that

• 4:07Speaker 03

  thousands of people decamped to go live in communes. And Stuart Brand had this idea. He said, well, why don't I just go sell stuff to help these people who are living in the communes? And he was a proponent of the idea that tools were a necessary thing for these communes to survive. And that's actually... It's actually kind of expressive of a lot of the spirit of the kind of the back to the land utopianism of the communes. But as we know, the communes failed. But Stuart Brand ended up creating this really strange, interesting book called The Whole Earth Catalog that was recommending tools and books to the people who were living out in these communes.

• 4:48Speaker 03

  And that book, which celebrated technology as being consistent with the spirit of the counterculture, became kind of a bible to a lot of people in that generation.

• 4:58Patrick O'Shaughnessy?

  So the book itself sold some absurd amount of copies, right?

• 5:03Speaker 03

  Yeah, millions of copies.

• 5:04Patrick O'Shaughnessy?

  And one of the bestselling books of the time. I was surprised I had never heard of it. And, you know, I went through it and there's a PDF of it that you can, you know, you can Google. And it's this kind of like magisterium, like bizarre collection of interesting... I mean, I almost kind of wish there was a modern equivalent, be something that would be fun to create, this kind of amalgamation of tools. So maybe talk about how Brand parlayed that success. He struck me as a brilliant marketer philosopher. Kind of what happened next and why he is responsible for sort of the founding ethos of Silicon Valley as we think about today?

• 5:38Speaker 03

  Well, so he spent a lot of time hanging around all these programmers who were obsessed with the Whole Earth Catalog. Steve Jobs was one person who was obsessed with the Whole Earth Catalog. But you had this whole crew at Xerox's Palo Alto Research Center, Xerox Park, which is a legendary space for innovation and the birthplace of personal computing. And no small measure, because Steve Jobs went there and saw the personal computer that they were building, and he totally borrowed from it in order to create the Mac. So what Brand was really good at doing was kind of, he was very articulate, and he was pithy, and he was, as you say, a great marketer. And so he saw what was

• 6:18Speaker 03

  happening in these labs in Silicon Valley, and he gave a name to it. And so he was the first person to come up with the idea of the personal computer. Not that people were developing the thing that was the personal computer, but he gave it a name and helped kind of explain it as a tool of personal... Liberation, which is totally important. Or one thing that's fascinating to me is that he went, he went to one of the labs where programmers were playing Pong, which was the first, the first video games. And he was like, oh my God, this is just like LSD. It's, it's another way of achieving consciousness. And I, so this is the crucial point. This is like the punchline to this whole story. So the communes completely fail, right? They're, they're big flops.

• 7:03Speaker 03

  That utopian experiment dissolves and people dissipate and go back into the, get absorbed into society. But the spirit of the communes doesn't die and it really lives in this part of Northern California. And I think what Stuart Brand and a lot of other people did was they tried to take the ideals of the counterculture, the ideals of the commune and find ways to replicate them in technology. So video games can transform your consciousness. But I think that this idea of kind of collectivism and utopianism end up manifesting themselves in a lot of the core concepts of Silicon Valley. So just to give you an example, I mean, we think of Silicon Valley as being libertarian. Think of Anand worshippers and those exist.

• 7:48Speaker 03

  There's no doubt that they exist. But so much of what Silicon Valley is about is about the collective. It's about, it's about, it's really, it's about recreating the commune. It's about, it's the reason why everything is based on this model of collective. It's social media. It's crowdsourcing. It's networked and, and everything is done in the spirit of collaboration. And to me, that's the core value of Silicon Valley. In a way, that's also the core danger of Silicon Valley.

• 8:16Patrick O'Shaughnessy?

  Talk a bit about the personal journey you went on to end up writing this book. So obviously you've gotten really deep into the history and the details and the kind of philosophical underpinnings to what we now see as big tech companies. We'll get back to that in a minute, but like, what got you so interested in this? Why the deep research?

• 8:35Speaker 03

  So I'm a writer. Writers are really narcissistic and they can't necessarily see problems until they afflict themselves. And so in 2014, Amazon was engaged in a contract renegotiation with the French publishing giant, Hachette, which is the little brown is one of their big imprints, 12. And I'd written a book for one of Hachette's imprints. And in the course of the ebook contract negotiation, Amazon just kept squeezing and squeezing. And Amazon initially set the price for ebooks at $9.99, which is something they did without consulting the publishers. They just kind of decided that this is what

• 9:16Speaker 03

  books should be priced, which had the effect of resetting the entire publishing industry. And so Amazon says, okay, we want to, we want to set the price here. And if you want to get good placement on our pages, you have to pay us this much. And they kept extracting terms. And Hachette got to the point where it screamed enough. And so Hachette took a hard line and Amazon responded by being very, very aggressive to Hachette. Now, Amazon controls an enormous part of the ebooks market. I mean, it's somewhere between 70 and 90%. Nobody can say exactly how much that they control, but obviously. Dominant. Yeah. Kindle is synonymous with ebooks. And so when Hachette said enough, Amazon

• 10:01Speaker 03

  said, okay, you want to play that game? And so they stripped the buy button off of Hachette books. They delayed shipments on certain books. Or if you searched for one Hachette title, and you were redirected to like a Simon and Schuster title. And so I was really radicalized by this. I was like, oh, my God, Monopoly isn't an abstract problem. It's like, it's really, it's actually, it's hitting me in the gut. They're punching me in the place where it counts. And so I got very active with the Authors Guild. And I ended up writing an article for The New Republic where I was editor called, "Amazon Must Be Stopped." So a really aggressive article.

• 10:38Speaker 03

  And two weeks after my article appeared, my bosses at The New Republic got a letter from Amazon and it said, Dear New Republic, because of your recent cover story about Amazon, we're no longer running our ad campaign with you. Please confirm receipt of this. Sincerely, Team Amazon. I was like, Jesus, these guys just proved the thesis of my book. And it just felt like to me like, you know, I just was interested in kind of the way in which the digital economy had settled. Like I, my first job out of college was with Microsoft. I worked for Slate, which was then owned by Microsoft. And I moved out to Seattle and I was really excited

• 11:18Speaker 03

  about the possibilities of an e-magazine. And it just seemed, it seemed cool. But Microsoft at that time was kind of set as the empire. And then because of so many reasons, Microsoft kind of tumbled briefly from its dominant position. And it opened up this wide, seemingly wide open economy where these companies rose in a nanosecond. And so we were kind of stuck in this way of thinking about the digital economy as if it was much more dynamic than everything that it had replaced. And I believed that too, until that, around that time when I was writing that piece about Amazon and Amazon was behaving so badly towards Ashet.

• 11:59Speaker 03

  And I began to think, you know what, maybe things have like actually settled now. And the idea of the platform, the idea of these networks was such that huge chunks of the economy were going to just become dependent on the platforms and the networks, which gave the platforms and networks huge power to assert control and dominance over the course of markets.

• 12:21Patrick O'Shaughnessy?

  I've been thinking a lot about this two-sided thing between Aldous Huxley and George Orwell's view of the world, where, I can't remember the book, but it was some line that said, you know, Orwell had it wrong. It's not what we fear that will kill us, it's what we love. And that's the more like Huxley version of the world, you know, people taking soma in Brave New World or something like that. And a lot of the, I guess, the tech giants seemed to kind of maybe fit into that mold. I'd love to hear you. Just kind of reflect on the role of technology, very generally speaking. There was a point in the book where you said something like, you know, there's always new technology that sort of breaks monopoly or democratizes certain things and then it just kind of rebundles and re-monopolizes. Do you think that that's just an inevitable cycle?

• 13:06Patrick O'Shaughnessy?

  What's kind of your general position on just the advance of technology in our world?

• 13:10Speaker 03

  First of all, just to be clear about a couple of things. So, technology is one of the things that defines us as a species. I mean, it is our ability to affect nature and it's something that distinguishes us. And human beings have always tried to have tools that kind of augmented the human body or replaced the human body. So, you know, factories automated upper body work. Hammers are an extension of the arm. And I think that's, that's great. And, and you know, Google is one of the most magnificent creations in human engineering. It's just, it's, it's really incredible. And the iPhone is, is a marvel of design and, and engineering. You know, but that said, I think what, what, what happens,

• 13:55Speaker 03

  so this is not exactly the answer to your question, but I think we just need to distinguish the ways in which these platforms and these technologies are a little bit different. Because a lot of what is being automated is actually, are actually mental functions. There's a form of intellectual automation that's happening right now. And one thing that distinguishes these technologies is that they stand between us and reality in a way that feels fairly unprecedented. That if I want to understand the world, these machines, these devices become my portal into large chunks of the world. And so, they have a lot of power to set the terms for reality.

• 14:38Speaker 03

  And what happens is that these, they pick winners and losers. The thing that appears at the top of the Google search engine is the thing that you're most likely to read. The thing that appears at the top of the Facebook newsfeed is the thing that you're most likely to read. The thing that appears at the top of an Amazon search is the thing that you're most likely to buy. And so, these platforms kind of shape the world by picking winners and losers. So, that's one part of it. And the second is, is that we are, as a species, becoming cyborg. It's just, it's just kind of a fact. And You see it now in the way in which I couldn't have gotten to this podcast if I hadn't used Google Maps to guide me here because I have no sense of direction and I've outsourced

• 15:21Speaker 03

  that all to my phone, which is awesome. I'm happy. It's like I'm really psyched to be relieved of that burden. But the truth is, is that we're merging and that, you know, people wear the technology on their wrists and augmented reality is like, it's here. It hasn't been implemented in mass form, but it will be adapted, adopted soon. So you'll be wearing glasses or whatever. And the day in which Google or something like that is implanted in your brain is not that far away. Mark Zuckerberg talks about this human machine interface where Facebook wants to be able to read your brainwaves, which is something

• 16:05Speaker 03

  that Elon Musk also invests in.

• 16:08Patrick O'Shaughnessy?

  Neuralink.

• 16:09Speaker 03

  It seems kind of crazy to me, but, but on the other hand,

• 16:13Patrick O'Shaughnessy?

  It's happening.

• 16:14Speaker 03

  The idea that I could watch every television show in the world in the palm of my hand, if you told me that when I was a kid, I'd say, there's, there's no way that's ever happening. That's so far fetched. And it's here.

• 16:24Patrick O'Shaughnessy?

  Go back to brand again, because I really want to crystallize the evolution of this philosophy in terms of how it shaped, I guess, the philosophy of these large companies. So you mentioned Steve Jobs already, but really the book was more about kind of this modern set of four, maybe four companies. You've already mentioned them in terms of them being enormous gatekeepers and these conflicting ideas of individualism, kind of libertarianism, you said Ayn Rand, versus a much more like networked, social world. So very specifically, other than influencing maybe Steve Jobs, what's the, the middle part of that story? The evolution from, you know, the early eighties and the personal computer to today?

• 17:02Speaker 03

  So the big dream was always the one of creating a global village. And that's, that's a really important dream of the 1960s. Marshall McLuhan, who was this Canadian philosopher, theorist of media who gave, who was a kind of a regular on TV talk shows in that era, talked about the global village. And that was, that was a real aspiration that got absorbed into the counterculture. Really part of the idea of the commune too. It's just that, once we understood that we were part of a global village, it would reshape human consciousness. We would behave better towards one another. We would behave more responsibly towards the planet. If only we could see the way in which it was all connected together. If we could see if we were part of a whole earth, to use Brand's phrase.

• 17:47Speaker 03

  And so, to me, that's a lot of the impetus that drives the creation of, of actually the internet. Which, if you think about it, I mean, this is really one of the fascinating counterfactuals. Is it possible to imagine an internet that exists in a way, shape, or form that's different from the internet that we now know? Is it inevitable that it gets captured where we have to think of it as one giant network? Or is it possible to think of it as a bunch of smaller interconnected networks? And this idea of the architecture of the internet and how we think about the architecture of the internet, is it centralized or decentralized?

• 18:29Speaker 03

  Is there ways to accentuate the decentralization or to accentuate the centralization? Those become very crucial foundational ideas that shape the outcome of how it develops as an economic unit, as a communications unit. And it seems to me that we were always pointed in this direction of centralization, simply because the dream was always having everybody wrapped up into one. There's this idea of oneness, of holism. That's like, it's a really, it's just kind of driven through our thinking about the internet. And I think in the end, it actually kind of becomes the basis for monopoly.

• 19:11Speaker 03

  That the idea that everybody could be stitched together into one global village is really the basis for the greatest business opportunities ever. And so, it was only a matter of time before the thing that starts off as the utopian commune ends up getting captured by the giant firm.

• 19:28Patrick O'Shaughnessy?

  Such a funny progression. What do you think happens next? Or maybe a different way of framing it would be, you know, we both have relatively young kids, we were talking about before we started, maybe from their perspective, you know, the way that the world's evolving. What worries you most about this, like, this maybe perversion of the original ideas? I understood it, which was that things like the internet are open networks that allow for Incredible innovation that kill gatekeepers that you know the the model of three channels or one local newspaper or whatever was this gatekeeper model and that that was somehow unhealthy because it it silenced the whole bunch of other potential innovation or voices. How do you think about kind of the current state of it through the lens of our kids or the that gatekeeper idea?

• 20:10Speaker 03

  Well, first of all, the idea that we could live in a world without gatekeepers is just

• 20:14Patrick O'Shaughnessy?

  illusion.

• 20:14Speaker 03

  Yeah. Yeah. And it's like it's almost like anarchism, right? That that people or Marxism, they they kind of dream about the withering away of the state, that there could be a world in which we all interact with one another as loving, caring human beings where you don't need you don't need the power of the state. But the power of the state always returns. There's always one group that kind of exists to exert dominance.

• 20:38Patrick O'Shaughnessy?

  There's always power.

• 20:39Speaker 03

  There's always power. Yeah, you can't escape power. And that's true of the internet, too. So the question of kids is, I mean, I think that the answer has to do with kind of how we as parents end up responding and what we teach our children about how they interact with this universe. You know, one of the things. So when you see your kid with an iPad or with a phone hunched over texting or swiping or whatever, it reflects you it reflects yourself back to you. Like, you can see your own addiction to technology. And but we're not, we don't really focus on our own self improvement, but we're terribly obsessed with making our kids better than we are. And so I think that a lot of parents go into a state of panic when they they look at their kids and

• 21:21Speaker 03

  their use of technology. And they they they're filled with a sense of dread.

• 21:26Patrick O'Shaughnessy?

  I feel like technology, you know, it's propelling us forward. Obviously, you look at the statistics on poverty or health or lifespan, like all these things, it's it's been an incredibly positive force. And you could also extend that to say that the market dynamics behind it that allow for innovation and the reward to innovation is a big driver of that. But the thing I'm always trying to understand is, I love the picture you see sometimes of, you know, everyone on a Metro North train with their iPhone. But then in the 1920s, it's just everyone with their newspaper, right? Like, we like to be distracted. And maybe that's just some fundamental part of us and technology just is. Better and better at capturing our attention in every waking moment. Is there a chance that that's not unhealthy? That this kind of constant mining of our attention at all hours of the day

• 22:11Patrick O'Shaughnessy?

  may not be the horrible thing that instinctually it seems like it is?

• 22:15Speaker 03

  Yeah, I mean, I don't totally foreclose the possibility that there's some good that comes of it. So let's just start with one concept, which is privacy. Like, I'm fairly devoted to privacy as a concept that I think is essential to human selfhood. But privacy, you know, the disappearance... So Zuckerberg argues that the disappearance of privacy is probably a good thing. Because if we're transparent human beings, we're going to behave more virtuously. So if you're the same person in the office that you are at home, you'll have integrity and you're probably going to behave better. And when I've, you know, in my book, I'm pretty hostile to that point of view.

• 22:58Speaker 03

  And in the end, I will be militantly hostile to that point of view. But let's concede a couple of things. Just thinking about the sexual harassment scandal that's kind of overtaking the world right now. You can see the way in which a more, a form of radical transparency is actually eliminating a very unhealthy power dynamic that when doors are closed, sometimes very, very bad things happen behind those closed doors. And so, you know, there are ways in which Zuckerberg is right that as we, as privacy diminishes, then maybe we will become, in some ways, better human beings. But what I worry is ultimately that when privacy diminishes, we're ultimately going to just be flattened as human beings.

• 23:42Speaker 03

  That one of the things... So, an example. If all of your Google searches were made public, I think it would make you less likely to search for certain things on Google. It's just a fact. And the truth is, we confide in our machines so much more than we confide in our fellow human beings. We're willing to tell these machines. But what if you had, you know, Google is a primary way in which people explore ideas.

• 24:12Speaker 03

  Or try to find out things about themselves. And so if I knew every, every Google search would become public and I had health questions about, about some condition, would I ask those questions to Google if I thought that they could possibly become public? I don't want the world to know that maybe I have herpes or, or that I have a heart condition or whatever it is, or that I'm worried that I have, you know, some embarrassing skin condition. Who knows what it is? You're less likely to ask those questions if you're gonna possibly be shamed for having them. Or let's put it in the realm of ideas. What if I am interested in anarchism or Anrand or whatever? I don't want my future employers to know that I was kicking around those ideas.

• 24:56Speaker 03

  Maybe I could be penalized for that. So rather than exploring those ideas, I'm just gonna be a little bit more cautious about the world until I become extremely cautious.

• 25:05Patrick O'Shaughnessy?

  Is another way of saying flattening, like homogenization, like kind of making everyone more similar? Is that what you mean by flattening?

• 25:12Speaker 03

  I just think, I mean, more cautious, less transgressive, almost more robotic in a way, in the way that we go, in how we go about the world.

• 25:20Patrick O'Shaughnessy?

  So then what is maybe a prescription for this problem? So if part of the problem is there's some really massive gatekeepers for our minds, our wallets, our physical activity, and these big companies in many ways control our activity and our, and the ways that we think because of what we're exposed to, what are some ways like around this? There's some neat passages about, you know, books, like real books and maybe ways of engaging in real contemplation. What are your thinkings on like the, the balance here where yes, technology is good, but here are the ways that we can make sure it doesn't get perverted?

• 25:56Speaker 03

  I'll answer by analogy, which is that automobile was created. Automobile, great piece of technology, replaces horses and buggies, like very efficient way to get from point A to point B. You don't have to rely on trains, which are kind of more of a command and control system where you, you've a rigid line that kind of takes you from point A to point B and you're, you have more freedom to go to wherever you want to go faster because the automobile But the problems, right? So the automobile, when it was created, a lot of people got run over because, you know what? There weren't stop signs, there weren't traffic limits, and they were horribly horrible for the planet because we did nothing to control the emissions.

• 26:38Speaker 03

  And so, over time, we took this incredible thing and we tried to harness it so that it was more more consonant with human beings. And so we created all these rules, from safety belts to fuel emission standards, that tried to harness that piece of technology for human purposes. And so I think we need to start thinking about how we can create systems and rules that can harness these technologies for human purposes. That's one part of it. And so there's a role that government can play and all that. So, right now, your data is not protected. Your health data might be protected, some of your financial data might be protected, but the data that these guys are collecting is not at all protected. And we act as if they own that data.

• 27:22Speaker 03

  And so they can they can trade it on a market and they can do all sorts of things with it. And there's a huge incentive for them to keep ramping up their surveillance of us because that's essential to their business advantage. So, we should have some rules about data. Then I think it's necessary to have a vision, an analysis about kind of what's what we want out of our economy and out of and out of these systems. And in the American way of thinking about the world, one thing that Americans have always thought long and hard about is power. That we have a constitutional system that is set out to create balance so that power doesn't end up getting lumped together in any one place.

• 28:07Speaker 03

  And when Thomas Jefferson and the founders thought about power, their biggest concern at that moment was executive power and power invested in a king. And so, a lot of the system in the Constitution focused on that. But they were also worried about excessive concentrations of private power, and they could see the ways in which, once you had excessive concentrations of private power, it would be bad for the democracy. And so... And that's, that was a kind of core thinking in American political economy up through the 1960s and 1970s, and then it just, it's kind of faded away over time.

• 28:42Patrick O'Shaughnessy?

  What will it take to make people realize that again? Like, you're starting to see grassroots-type stuff with the monopoly term around some of these big companies. And maybe the difference that people have pointed out, which I find interesting, is, you know, if you think of monopoly, people often picture Rockefeller, Standard Oil, or something like this, where they're extracting maybe more than their fair share from a market. Whereas in the case of, let's take Amazon, like, everyone loves Amazon. Like, Amazon has made everyone's life better and easier and cheaper and more convenient. So, how do you think that might happen this time around, given that typically monopoly's been this kind of corporation-as-evil, whereas a lot of these corporations are the most kind of beloved by their users?

• 29:24Speaker 03

  I think one thing is that there's a split right now between the way that elites perceive these corporations and the way that consumers perceive these corporations, that elites in some way have suffered, or can feel like they can see the dangers pretty clearly of some of these companies. So, in media, it's-

• 29:45Patrick O'Shaughnessy?

  A hot topic, yeah.

• 29:46Speaker 03

  Yeah, where ideas kind of are shaped and formed and disseminated and have the ability to affect mass opinion. Media is incredibly dependent on Google and Facebook, and with this last election, they've kind of seen an opportunity to beat up on Facebook especially. Now, I think that their hostility to Facebook has something to do with the election, but it also has a lot to do with media's own sense of dependence and the way that, on Facebook, and the way that Facebook has distorted media. So, there's psychodrama there, for sure. But, look, there's something really interesting that's happening in our political system right

• 30:24Speaker 03

  now, which is that this topic of monopoly has appeal across ideologies, and it could actually cause divisions within coalitions. So, starting on the left, you've got people like Bernie Sanders and Elizabeth Warren, especially Elizabeth Warren, who've- Talked about this issue of monopoly and Elizabeth Warren talked in in August of two thousand five gave the first speech kind of decrying the platform companies as part of the broader problem of monopoly. And that's a split because you had Obama, who was very much tied to Google and very supportive of Facebook. And I think you'll have a division within the left between a kind of a populist left and a more technocratic left on this issue. But I don't think that it's

• 31:09Speaker 03

  a neat division. So if we shift a little bit to the center, I was in New York a couple of weeks ago, talking to a conference for a group called No Labels, which is aggressively centrist and aggressively nonpartisan. And it was organized by Bill Kristol on the right and a guy called Bill Austin on the center left. And one of their five big ideas for this year was taking on the Titans of tech. And it was an audience filled with Wall Street types and people who are who identify as centrist. And they were really interested in this topic because they care about the future of democracy. And these companies exert enormous influence on the course of democracy. And also, they're people who care about the functioning of markets. And they worry that if things become

• 31:53Speaker 03

  too centralized, we're actually stifling opportunities for investment and opportunities to and the incentive to create startups could start to diminish, maybe even has diminished already. Then you've got the Steve Bannon, right, which is Steve Bannon is incredibly hostile to Silicon Valley. There's a guy who's running for Senate in Missouri, who's the Attorney General, who's Republican, who just brought a lawsuit against Google. And so, who knows how this is all going to shake out. I think that the companies are going to face pressure, though, that's going to come at them from all different angles.

• 32:26Patrick O'Shaughnessy?

  There was a short book by Will and Ariel Durant called The Lessons of History that kind of took their god knows how many millions of words that they wrote and condensed it down to 110 pages. It's maybe my favorite book ever. And the lesson that I always remember from that is this wax and wine between like centralization of power, or different levels of inequality of power, things like this. And that it's never one directional, that it's like a sine wave, like it goes up and it goes down, it goes up and it goes down. And it's interesting to think, just because these companies do seem fine, or good, that they may represent like the peak of one of those those centralization centralizations of power.

• 33:05Speaker 03

  That's really interesting. I think that's right, too. It's kind of instinctually my sense. And you see it within American liberalism, for instance, which I think really does follow that type of curve, where it goes through periods where it celebrates corporate concentration as being efficient, and then it starts to worry about corporate concentration and starts applying antitrust pressure on it. And so antitrust kind of comes and it goes and kind of cycles in generations as power waxes and wanes.

• 33:36Patrick O'Shaughnessy?

  Talk a little bit more about the line of work that you're in, the kind of media and publishing and editorial worlds, and maybe the kind of pros and cons that you're seeing the very present. So what the major trends are, things that have you most concerned in terms of just like independence of voice and a diversity of opinion, all these things that maybe come under jeopardy when you're so, you know, media is so reliant for distribution on these couple of big companies.

• 34:01Speaker 03

  So the biggest, my biggest concern is actually, it's political, and which is that right now in our society, there's diminishing basis for common fact. So that if I say, if I say the sky is blue, that becomes a partisan issue. And people, people will process that through whatever media that they're getting. And there's this term called filter bubbles. And so our politics was becoming really polarized before the internet. There's no doubt about that. And people were starting to sort themselves geographically on the basis of political opinion. But one of the things that Facebook has done is that it's

• 34:41Speaker 03

  kind of very, very powerfully amplified that trend. Because Facebook is a feedback loop. Facebook takes everything that you tell it and then uses that data as a basis for sorting information. That Facebook, as I said, it knows so much about you. Everybody knows so much about you, unfortunately, but they know basically the things that give you pleasure, and they know the things that give you anxiety, and the things that turn you off. And so it takes that information and it arranges the things in your news feed in order to exploit those emotions. And politically, that's extremely dangerous because it does

• 35:22Speaker 03

  reinforce the filter bubbles in a very, very industrial strength sort of way, where your biases are constantly being confirmed because your information is sorted so aggressively.

• 35:36Speaker 03

  To confirm your biases. And if you're just hearing the things that you want to hear all the time, it is intellectually incapacitating. You become weak when presented with fake news or propaganda or demagoguery, or when there are bad actors out there who are trying to exploit the system in order to sow distrust or to foment anger.

• 36:00Patrick O'Shaughnessy?

  So Facebook seems like it's got a maybe a unique position in terms of the outsourcing of thinking or the outsourcing of kind of the inputs that we put that probably form our thinking. Do you think that that extends also as much to some of these other tech giants? Like, the same argument doesn't seem quite there for something like an Amazon, where it's more about stuff.

• 36:21Speaker 03

  Amazon represents a different sort of danger. Amazon, with Amazon, we're kind of returning to a very, right now, it's a fairly inchoate anxiety about size. And it's that, you know, as Amazon kind of drifts in the next couple of years to being 50% of all retail, it's a pretty impressive achievement. I mean, you have to, even if you're a critic of Amazon, you have to say, damn, that's like, that is one of the greatest businesses ever. Maybe the greatest business ever. Maybe Amazon is the greatest business ever. They haven't, they don't necessarily have the profits to show for it, but it's because they're thinking in such a long-term sort of way about constructing complete and total dominance.

• 37:05Speaker 03

  And so it started off as the everything store, pretty ambitious goal. But then it just kind of morphed into all these other different areas where it's a movie studio, it owns the Washington Post, it owns Whole Foods, it powers the cloud. And like, where does, where is Amazon ever going to stop? And is it okay?

• 37:23Patrick O'Shaughnessy?

  It's like the Borg.

• 37:24Speaker 03

  Is it, no, but is it okay if there's just one store? Like, if there's just like, if everything is just kind of in one place? And it's going to come really quickly and it can be really cheap. But isn't there, isn't there a problem with that? And I think. There are problems. There are definite problems. One problem is that it means that Amazon exerts enormous control over the people who supply it with the stuff it sells, which is in economics, it's the problem of monopsony. It's that when you're the dominant seller, it means that all your suppliers are completely dependent on you and you can get squeezed and squeezed and squeezed like Hachette was in its ebook contract renegotiation. That's a problem.

• 38:08Patrick O'Shaughnessy?

  Talk about Google, too. I think that's an interesting one, which, like you said, we're never more honest than maybe with Google. What are the things that concern you about that service or that company with their "Don't Be Evil" slogan?

• 38:20Speaker 03

  It's the same sort of concern, which is that, let me put it this way. A search engine looks and behaves as if it's a neutral thing, that it's kind of using math in order to determine what comes at the top of its search results and what comes on page four. Now, as we've said, it's the thing that comes at the top of the search results that's the thing that we're most likely to read or to buy. And so that gives Google huge control over outcomes and information and in business, too. If you're able to game that system best, you spring to the top. Now, one problem we see with the platforms is that, like, as these guys keep getting

• 39:03Speaker 03

  bigger and bigger, they go from being simply the platform, simply being a tool, to also being an actor on their own platforms. And so, Google, a classic example is restaurants. So, a couple of years ago, you wanted to type in a restaurant name. The first thing that came up was a Yelp result. Now, Google saw that and they're like, oh, this is an important service and a good business. And so, what do they do? Well, they hardwired into Google Yelp. And so, Google was no longer a neutral platform. Google was privileging its own service. And so, to me, that's kind of the mega danger here. It's the thing that's got the European Union most freaked out.

• 39:48Speaker 03

  And I think from the perspective of regulation, ensuring the neutrality of these platforms is actually absolutely essential.

• 39:59Speaker 03

  Here's another example that's got me worried. So Facebook, like all of media is dependent on Facebook for traffic and therefore for revenue.

• 40:06Patrick O'Shaughnessy?

  Like what, we'll put some numbers on that. Like what percent of, of readers will come via Facebook for, you know, a major media company?

• 40:13Speaker 03

  It's probably about half.

• 40:15Patrick O'Shaughnessy?

  That's crazy.

• 40:15Speaker 03

  Yeah, it's, it's somewhere between 30% and a half. And some, some places it's much, much higher. Like at BuzzFeed, it's probably, I think I've seen it's like 70 or 80% or something like that. And so they've made this decision to switch to, to video. That video is what will keep their users engaged for the longest period of time. All right, fine. But what's happening right now, so that means that Facebook is becoming a television, it's your television set. That's what their, I think that their ambition is at this moment. And so everybody in media is now switching to video. And so they're trying to produce videos that, and Facebook is going about now commissioning video. They're actually paying people to produce for Facebook.

• 40:58Speaker 03

  And so isn't it in Facebook's interest to make the stuff that they invest in appear first in their platform? And so Facebook is inevitably going to start to favor Facebook's own content. And so that's even more power. So Facebook will have, will have, will have, will supply the eyeballs and will supply the, the, the, the things that the eyeballs see.

• 41:19Patrick O'Shaughnessy?

  Is there a set of, it could be a company, it could be an industry or, or just technology trend that is like a counterpoint to all this? So something that you see as kind of a light at the end of this tunnel? That you're really excited by the platform, it could be a platform company or anything else?

• 41:35Speaker 03

  Well, here's one counterintuitive thing, which is that when the Kindle was invented in 2008, everybody said that paper books were going to disappear forever and ever. Nicholas Negroponte, who is, uh, headed the MIT Media Lab, said by the year 2015, paper books will cease to be published. And lo and behold, we passed that date and paper books continue to get published. E-books have kind of plateaued. Paper book sales tick up every year, you know, maybe 1% or 2%, but they're headed in an upward direction. And I think that that's kind of an incredible thing because I think it, it shows, first of all, book publishers have managed to defend the underlying economic value of the product that they produce.

• 42:20Speaker 03

  That's pretty cool and counterintuitive. And then secondly, I think in the, for the culture more broadly, it's encouraging to me because. One thing that paper books are is disconnected, that there's nobody watching over your shoulders as you read, you're not umbilically connected to a corporate store, you're not being notified by your book or distracted by your book constantly, you're able to engage in kind of a deep commitment to text. And so I think the fact that we've been able to sustain that is actually a fairly encouraging thing.

• 42:52Patrick O'Shaughnessy?

  Do you think we'll see kind of movements or groups or whatever you want to think about it, like secular religions almost, that emphasize this sort of detachment and maybe it's a commune with nature, maybe it's about physical books, is there anything like that that you're starting to see emerge?

• 43:09Speaker 03

  I think that that's almost inevitable. And here's something that just occurs to me. I think you could have, in a way, almost two competing spiritual and religious divisions. One is, is that as we move into a world of virtual reality, and possibly a world where there's not jobs, you can imagine a lot of people kind of sitting around all day on their couches, living in virtual realities, playing video games or whatever, and you could see that almost being a religion unto itself. Like, it almost has to become a religion at some point to kind of supply people, people's lives with the meaning that they no longer have in work, they can no longer find in work. You know, on the other side, I think

• 43:50Speaker 03

  that the distraction is actually a fundamental threat to us as spiritual beings. I think it's actually the biggest, it's a spiritual crisis, that if you're always being notified, if you kind of lose the possibility for independence of thought, because your attention is being reverse engineered, you know, material is being reverse engineered in this sort of way to kind of addict you to whatever is getting thrown at you by the machine and by the platform, then you no longer have the space for contemplation, it becomes harder and harder to muster independent thought. And so I do think it's a spiritual crisis, and if religion was smart, it would find some sort of way to...

• 44:35Speaker 03

  To leverage this opportunity to kind of defend itself.

• 44:38Patrick O'Shaughnessy?

  Talk a bit about, I think it was in your book, maybe it was something else that you wrote, but it sticks out in my memory, the idea that most of the big innovations have happened with people sort of thinking in a very separated, maybe solitary contemplative mode.

• 44:54Speaker 03

  Again, there are two visions for creativity. One vision comes from the romantic poets like William Wordsworth, and it was this cult of the individual as a genius. And we know that that's not entirely true, that every so-called genius is actually, you know, borrowing stuff from here and there and-

• 45:15Patrick O'Shaughnessy?

  And part of a system.

• 45:16Speaker 03

  And part of a system. And then the other kind of myth is the one of collaboration, which is something that Silicon Valley is deeply into. And our society is, on a whole, really into right now this idea that all ideas need to happen in groups. You see this shift happening everywhere. And so it's like, when I started working, everybody worked in individual offices. But now you're supposed to work in these open floor plan things where you're kind of part of this amoeba, you're part of this team. And it's true in schools as well, where projects are now group projects. Everybody wants to show that they can work across groups. And so I think both of these myths, the one of the romantic myth of the individual genius,

• 45:59Speaker 03

  Silicon Valley's myth of the collective collaborative workplace, they're both myths. But if we're going to create new ideas, you almost have to have the fetishization of the individual genius and like this quest for glory, that this idea that geniuses can come with totally paradigm-shattering, original ideas. And we want people to believe that that is true because that's how we do aim for those big breakthroughs.

• 46:31Patrick O'Shaughnessy?

  What's the most exciting thing that you're thinking about now? So you went through this incredible thought process yourself about how this philosophy has evolved and sort of evolved into companies and what those companies mean for us. What, and it could be some aspect that's a continuation of these ideas, but what kind of has your attention right now most?

• 46:50Speaker 03

  So I'm really, I'm excited by two things. One is I think that our political system is shifting in a way that's very interesting, that Donald Trump is a giant disruption to the system and that it's forced people to reconsider a lot of truisms and to rethink things. And so the idea that our political system is moving to an analysis of power potentially that's very different than the one that's dominated and that actually will have truck in both the left and the right and that there's a worry about concentration of power. I think that that's an interesting, that's a really interesting sort of development. And kind of as attached to that, there's kind of, I think there'll be ideas about liberty

• 47:31Speaker 03

  and freedom that grow out of that and kind of a celebration of certain parts of individualism and individuality that I think are both beautiful and underrated and in some degree kind of captured by libertarians, but really should be part of a much broader understanding of the world. And secondly, just going out and talking to, I've interacted a lot with college kids and people who've lived their lives on the internet. And I find that they have, in a way, more self-awareness about the problem than anybody else right now. And then I've talked to a lot of computer science students who are kind of desperate to change computer science.

• 48:16Speaker 03

  And I think this is actually, of all the things we can do, maybe the most realistic and the most necessary, which is that everything in the world is computer science now. Everything in the world is the internet. And that means that computer science has become too precious to leave just in the hands of people who are currently attracted to computer science. That engineering as a mindset is all about designing systems to be efficient and systems that work on their own terms. But we need engineers and computer scientists who are also humanists, who are able to understand the ethical and political consequences of the systems that they build, to understand

• 48:58Speaker 03

  that human beings, actual human beings, are part of the systems, not just piles of data.

• 49:02Patrick O'Shaughnessy?

  Do you think that takes the form of another Stuart Brand, like a philosopher Pied Piper type leader, or is it more of a political and, you know, regulatory type outcome?

• 49:13Speaker 03

  I'm not sure. But I know that if you go to a place like Stanford right now, where it's like almost half the kids are computer science majors now, which is incredible. I mean, it's just this shift. I think universities are going to, you know, they need to, they need to take a leadership role in remaking curriculum. I think that there's just going to be, I think the changes are so profound that elites, leaders, people across all sectors are going to start to awaken to the problem and realize that we need to, we need to rethink a lot of aspects of our educational system, as well as our value system, in order to get to the other side of these changes in a way where

• 49:55Speaker 03

  we feel like we're still recognizably human, where a lot of our values are able to survive these transitions.

• 50:03Patrick O'Shaughnessy?

  What was the most memorable, or maybe the piece of content that you would most recommend others check out, that you discovered in the process of doing this research and writing the book? Could be a book, could be an article, could be a person, anything, catalog.

• 50:17Speaker 03

  So I think that so like so much of my book is actually about is about the idea of contemplation and about the necessity of contemplation and how we can achieve states of contemplation. And so I've read I've read a lot of books about that, including Hannah Arendt, who is the famous German then American political theorist and thinker, gave a series of lectures about the life of mind and kind of what is it this question of kind of what does it mean to think? And how is thinking different than our pursuit of knowledge? And how is thinking different than science? And to what extent is thinking kind of inherent

• 50:58Speaker 03

  to being a human being? To what extent is thinking necessary for us to live in a functioning democracy? And I don't know, I find these questions to be extremely primary. And that to me is kind of the ballgame.

• 51:16Patrick O'Shaughnessy?

  What was your conclusion? So what is the best way to obviously, it's going to be can't be one size fits all. But what are kind of the best general ways to cultivate more contemplation?

• 51:26Speaker 03

  I think the key word in that question is cultivate. And I have a riff in the book where the term culture comes from the Latin root colari and this idea of cultivation, which is an agricultural term, right? This idea that you can kind of grow and nurture. And the idea of culture itself grew out of this metaphor with farming that you in order to the mind needs to be tended to in the same sort of way that we tend to our fields. And that means that you you can't be passive in the course of that. You can't just rely on the weather and seeds getting blown in the wind to kind of guarantee a harvest every

• 52:09Speaker 03

  year. And so I think this idea of self improvement is really profoundly important that there's so much about the world right now that seems like as human beings, we have so little ability to affect it, that technology comes. And it's like, I think a lot of us think like we have no ability to shape the future of technology. It's just going to happen in this unstoppable sort of way. Or climate change is like this unstoppable sort of phenomenon. And so Really, we need to restore a sense of agency, a sense that as human beings, we can we can affect the world and starting with our ability to affect ourselves, that we can

• 52:51Speaker 03

  always, as human beings, we can always grow to be more ethical, to be more learned, to be more curious, to be more open minded. And these are things that just don't happen automatically, that you need to do it in a very self-conscious sort of way.

• 53:09Patrick O'Shaughnessy?

  I'm assuming that that's happened for you to some degree, that you've tried to cultivate this in yourself, being more contemplative, recognizing that this isn't the answer for other people. But is there any specific activity, or mindset, or set of rules, or whatever it is that you do, that you feel has really helped you, has really affected change?

• 53:27Speaker 03

  So, there's a guy called Tristan Harris, if you come across him. He was a philosopher, computer scientist, who went to work for, he had a startup called Aperture that got bought by Google. And Google gave him a position, he was like their ethicist in chief, and he was embedded in their product teams, helping to build Google products to be more respectful of human beings. And he ended up leaving because he felt like these technologies were even more addictive and manipulative than people understood. And he created an organization called Time Well Spent, that offers suggestions about how we can create space between us and technology. And so, there's part of this that I've integrated into my own life, that

• 54:09Speaker 03

  I used to sleep with my cellphone, but I don't do that anymore, because I don't want to wake up in the middle of the night and get trapped in endless scroll, which happens, or be on the receiving end of all the anxiety that your phone is a portal to. I've turned off notifications on my phone, so that only a human being has the ability to grab my attention. You know, I don't let, I don't let my apps do that, or newspapers, or whatever. I took Facebook off of my phone, so that if I want to use it, I have to self-consciously seek it out on my laptop, so that I'm not just in a zombolic state, getting trapped in their endless scroll. I mean, that's kind of, I mean, with, so-

• 54:50Patrick O'Shaughnessy?

  Simple stuff, I mean.

• 54:51Speaker 03

  No, it is. It's but it's like with food and drink, those things are addictive too. Right. But we are taught moderation. We learn how we can enjoy, we can enjoy food, we can enjoy wine, but we don't abuse it in a way that kind of.

• 55:07Patrick O'Shaughnessy?

  Pound wine all night, every night.

• 55:09Speaker 03

  Yeah, yeah, that takes takes over our lives. And the same should be true for for these tools and these technologies. Like, we should be able to enjoy the fruits of them without them exercising mind control.

• 55:21Patrick O'Shaughnessy?

  Last question I always ask everyone is for the kindest thing that anyone's ever done for you.

• 55:25Speaker 03

  I've been lucky to have friends who crises are, every life has its share of crises. And I think that the extent to which your friends kind of are selfless in the face of crises are, it's always because you when you're in the middle of a crisis, you feel so you feel alone, right? And you get into this existent moment of existential fear and like the sense that you screw up at work and like you're going to lose your job and you still livelihood. Your brain starts to make all these connections and about the worst that can happen. And then when you have friends who are able in that moment of crisis to come in and behave selflessly to you,

• 56:09Speaker 03

  that's the most extraordinary thing. I had I had one crisis at work where I was editor and we published,

• 56:17Speaker 03

  published a series of articles that were alleged to have been fabricated by an author. And it was an author who was a soldier in Iraq and said to have embellished them. And it was in like in the middle of the Iraq war and advertisers were kind of really coming down hard on us. And it felt like everything was going to go to shit. And I had a friend who was actually going to, he'd worked with me and he was taking, he was taking over another job. And he spent a week just kind of helping me like on his own, going full time, crazy, long days, like trying to help me get through this crisis where he's kind of embedded with me. And that was, it was just, it was such a beautiful act of friendship.

• 56:59Patrick O'Shaughnessy?

  Fantastic. Well, this has been really, really fun and edifying. I really appreciate all your time.

• 57:03Speaker 03

  All right. Thank you.

• 57:06Patrick O'Shaughnessy?

  Hey everyone, Patrick here again. To find more episodes of Invest Like the Best, go to investorfieldguide.com/podcast. If you're a book lover, you can also sign up for my book club at investorfieldguide.com/bookclub. After you sign up, you'll receive a full investor curriculum right away, and then three to four suggestions of new books every month. You can also follow me on Twitter @Patrick_OShag. If you enjoy the show, please leave a quick review for us on iTunes, which will help more people discover Invest Like the Best. Thanks so much for listening.