@matthewstoller's Threads
Mark Zuckerberg is speaking today on free speech. I wrote a piece for the New York Times on how to actually address the problem of big tech and free speech. Break them up and get rid of advertising on information utilities. nytimes.com/2019/10/17/opi…
A key problem we have with big tech is something I call "Conflicted Communications." Advertising corrupts communications networks just like it corrupts media. But we have systems set up for media, but not for these new information utilities. nytimes.com/2019/10/17/opi…
The problem with Google and Facebook is twofold. They have monopolized ad revenue globally. But they have also themselves *been corrupted* by ad revenue, aka conflicted communications. Larry/Sergey knew this would happen. They wrote about it in the 1990s. nytimes.com/2019/10/17/opi…
1. There is a crisis of capitalism right now, and that is the overriding problem in our world. No one trusts our economic system, it is abusive to everyone attached to it, even the super-rich. This system is branded as capitalism, but really it is a system of monopolies.
2. Since I started working on the monopoly problem, I've learned of monopolies *everywhere.* There's the big stuff, like airlines who can kill cities by changing airline routes. And Google, Facebook, and Amazon organizing our public commons. But monopolies exist in small markets.
3. Business software is rife with concentrated power. Microsoft is killing Zoom and Slack with its inferior yet free offerings. vox.com/2019/10/14/209…
It's easy to see this as pure cynicism, but it's not. Business leaders aren't stupid, they know that corporations exist only because we the people allow them to exist. Elizabeth Warren isn't the left, she's the new center.
Benioff's comments are similar to those coming from the Business Roundtable and to business leaders like Brad Smith of Microsoft in his book Tools and Weapons. The leaders of monopolies have a *responsibility* to society, they argue. We're back to 1912.
It's not just Warren. Bernie just came out with a plan to restructure corporate America. Trump bashes corporations regularly. Even Joe Biden talks about sending insurance company executives to jail.
The center will not hold. Neoliberalism is over.
The center will not hold. Neoliberalism is over.
1. What do monopolies have to do with China and the NBA? Plenty. Historically, there are important analogies bn how China uses its economic power and how Germany did prior to WWII. I have a chapter in my upcoming book called "Trustbusters against Hitler." simonandschuster.com/books/Goliath/…
2. Let's start with just how powerful China is. Here are some domestic industries who told the U.S. government about dependencies on China. They were complaining about tariffs, but in reality exposing how little capacity we have here to do what we need to sustain ourselves.
3. Vitamin C, nylon products, optical scanners, consumer robotics, electronics, all types of clothing, specialty chemicals... mattstoller.substack.com/p/trump-antitr…
Aristocracy is bad for the winners and worse for the losers. The point is, we have a common political problem. Reeves’s goal is to prevent the change that might come if we all decided this system sucks for everyone.
Reeves is wrong. It is not true the children of the upper middle class will be fine. The ladder has been being pulled up for decades. Fear is pervasive everywhere.
The other problem with Reeves's argument is there are many well-educated credentialed people who dislike being in well-paid useless professions but cannot find anywhere else to go because of concentrated power they cannot affect. mattstoller.substack.com/p/very-few-whi…
I wrote a book called Goliath about the war between monopoly power and democratic movements in the 20th century. The final version arrived in the mail so here's a picture of it. It's really fun and you should pre-order it. simonandschuster.com/books/Goliath/… 
My experience writing a book is that it's a lot more fun to have written a book than to write one.
I wrote it because I was working in Congress during the financial crisis and I slowly realized we were facing not just a technical problem with banks but a political crisis. And I was totally confused, as were all my friends. I usually look to history when I'm confused.
To make the impeachment charges tick Democrats should really get Joe Biden to drop out. Hunter Biden is dirty, Joe Biden is dirty.
Trump is using bad faith impeachable offenses to attack Joe Biden, it won't work if Biden drops out of the race.
today.com/video/joe-bide…
Trump is using bad faith impeachable offenses to attack Joe Biden, it won't work if Biden drops out of the race.
today.com/video/joe-bide…
It's just disgusting both that Trump is attacking Hunter Biden's corruption using foreign leaders and it is equally disgusting that Democrats will not point out that the influence peddling by Joe Biden to enrich Hunter Biden was rancid and wrong. today.com/video/joe-bide…
I think @mattyglesias really nailed the Joe Biden-Hunter Biden problem. vox.com/policy-and-pol…
This is an important argument by @briebriejoy on identity and power. It's something I encountered in researching corporate power. There are two basic big questions about justice in American history. (1) Can citizens self-govern? (2) Who is a citizen? currentaffairs.org/2017/09/how-id…
@briebriejoy America was founded out of aristocracy. Colonial American children learned about their betters before learning the difference between right and left. You would bow your head to a gentleman on street, not look him in the eye. A self-governing free citizenry was a fringe idea.
@briebriejoy Men like Alexander Hamilton simply did not believe in popular self-government, opposing democracy, straight out, as a bad system. He lost that battle. But many who sought liberty and self-government for citizens defined citizenship in a deeply exclusionary and racist way.
Today I wrote about WeWork and what I call Counterfeit Capitalism. There are important lessons in CEO Adam Neumann's rise and fall. mattstoller.substack.com/p/wework-and-c…
1. Counterfeit capitalism is running companies not to make money but to lose money. Financiers allow this for two reasons. One, they hope long-term losses turn into market power, aka Amazon. Two, they hope a bigger fool buys at a higher valuation, aka WeWork.
2. WeWork's business model had been to make stupid graphics to show investors in hopes that they give ex-CEO Adam Neumann more money. mattstoller.substack.com/welcome
Capitalism is based on combining inputs so the output is more valuable than the sum of the inputs. The reason predatory pricing should be illegal is that when it's not you get morons with access to money blowing billions in capital on stupid ego trips.
If predatory pricing were illegal, which is to say you were not allowed to run companies to intentionally lose money in anti-competitive ways, much of the bullshit counterfeit economy (Lyft, Uber, WeWork, Bird) would disappear. And it should disappear.
Give any crazy person a credit card he doesn't have to pay back combined with a giant PR department and you get WeWork. Adam Neumann isn't a genius, he's a corrupt man-child whose only constraint is the patience of other corrupt man-children.
1. To take the snark out for a second, if the Democrats in the House do choose to impeach Trump, it will be a major step forward for both the rule of the law and American democracy. It will begin restoring Congress to its rightful place as a co-equal branch of government.
2. The single worst Congress I encountered in my research for my book on monopolies was that of the Democrats elected in 1930. The election happened in the wake of a vicious recession (not yet depression) as a reaction against Hoover. Democrats were adamant about doing nothing.
3. It was a moment of transition. In the 1920s, Americans, and people globally, had lost their faith in democracy. Walter Lippmann thought it was unworkable. 1928, the U.S. Army training manual said democracy resulted in "demogogism, license, agitation, discontent, anarchy."
“During the Obama years, several months after James [Biden] joined a construction firm as an executive, the firm received a contract worth more than a billion dollars to build houses in Iraq while Joe oversaw the U.S.-led occupation of that country.” google.com/amp/s/www.poli…
“In the early 2000s, before working with his uncle, Hunter had opened a lobbying practice that landed clients with interests that overlapped with Joe’s committee priorities. Ahead of his father’s second presidential bid, he entered the hedge fund business with James.”
“as Joe was entering the Senate and taking a seat on the Banking Committee, James obtained unusually generous loans from lenders who later faced federal regulatory issues.“
Trump is bad but Hunter Biden trading on his father’s position is really corrupt. We can walk and chew gum people. Hunter Biden has been on the payroll of the Chinese state and on the payroll of Ukrainian oligarchs. This is bad.
The Hunter Biden stuff reminds me of the Clinton Foundation and Wall Street speaking fees. Democrats said allegations of corruption were conspiratorial. But general election voters aren’t stupid. Wealthy pols and their family getting corrupt cash is bad.
We can’t have it both ways. We can’t demand investigations of Trump for corruption and abuse of power and disclaim very obvious red flags in Biden world.
1. Ah, the old chestnut of applying anti-monopoly language to democratic institutions... There is something very important in what ex-Goldman Sachs CEO Lloyd Blankfein is saying, however.
2. Institutions like Goldman Sachs are not businesses. They are *private governments.* There is a fight, and there has always been a fight, between the sovereign power of Wall Street and the sovereign power of democratic institutions. It goes back to Hamilton vs Jefferson.
3. Here's Mark Zuckerberg making the point explicitly. “In a lot of ways Facebook is more like a government than a traditional company. We have this large community of people, and more than other technology companies we’re really setting policies.”
Yup.
Yup.
1. This transcript from Uber's general counsel is incredible. It is a polite version of a mafia threat to California's legislature.
2. First @tonywest argues that the newly passed law doesn't encompass Uber drivers. It is simply codifying a California Supreme Court decision that imposes a test on whether someone is an independent contractor or an employee.
@tonywest 3. West is correct that it does codify that Supreme Court decision. But he says that the test that decision imposes doesn't include Uber drivers, and links to three 'rulings' that validate his claim. Two are arbitration decisions!
So @HeerJeet wrote a piece on the declining influence of big progressive D.C. think tanks with thoughts from @mschmitt9, @Econ_Marshall, @MattBruenig and @BruceBartlett. thenation.com/article/think-…
@HeerJeet @mschmitt9 @Econ_Marshall @MattBruenig @BruceBartlett A couple of thoughts. Dominant progressive think tanks are basically a post-2003 phenomenon. There was EPI in the 1980s and IPS, but basically Dems did their thinking from *within* Congress prior to the 1995 GOP takeover.
@HeerJeet @mschmitt9 @Econ_Marshall @MattBruenig @BruceBartlett The problem that progressive think tanks have is the same problem all progressives have today. Progressives got what they wanted in Obama, and it turns out the Obama Presidency sucked for most people. The ideology broke down.
1. I appreciate the work MMT advocates have done to point out deficits are a stupid way to organize policy constrains. I especially appreciate @rohangrey and his work on institutional questions of how money intersects with the real economy. That said... ineteconomics.org/perspectives/b…
@rohangrey 2. We've always known that money printing is a sovereign question. Money coining is in the Constitution for a reason. Greenbackers, populists and inflationists from the 1870s-1930s presaged Keynes. As did Benjamin Franklin.
@rohangrey 3. There have always been bitter fights over the founding of the Federal Reserve, and over institutional financial questions in the 20th century. J.M. Keynes, Nicholas Kaldor, and Hyman Minksy were core vessels for this debate. Who should hold power? The people or Wall Street?
1. Today I wrote about the recent blackouts in New York City, the greatest city in America. Monopolization and financialization have put NYC on the brink of disaster. And it's not just electricity. mattstoller.substack.com/welcome
2. Blackouts are scary things. On July 13th, people got stuck in elevators, the subway stopped, theaters shut down, and Jennifer Lopez was interrupted in the middle of a song at Madison Square Garden. nytimes.com/2019/07/15/nyr…
3. Another blackout happened a week later. Just before the blackout, NYC electric utility Con Ed president Tim Cawley embarrassingly said, “By any measure, we are the most reliable electric delivery system in the United States." Oops.
mattstoller.substack.com/welcome
mattstoller.substack.com/welcome
1. Starting 2006 or so, I've become somewhat disillusioned with the Democratic Party. I'm going to explain why. It has to do with the relationship most Democrats have with corporate power, or really, power. Now first, to explain, I'm a liberal Democrat.
2. What I saw in 2006 was the allegiance Barack Obama and Hillary Clinton had to lobbying power. They both backed Joe Lieberman against a Democrat. Obama then lied about NAFTA in 2008, and retroactive immunity for telecoms. He lied about a lot in 2008. Dems didn't notice or care.
3. In 2009, I began working in Congress for a member of the financial services committee. Tim Geithner sought a foreclosure wave and to help the banks. Rahm Emanuel Larry Summers ran around protecting monopolies. My friends at Moveon, etc didn't notice, cheerleading Obamacare.
Progressive trade thinkers do not see U.S. trade relationships as a mechanism to benefit Americans, they see it as a mechanism to benefit the global poor. This is a serious conceptual flaw and a hangover of the 'affluence' philosophy that no longer aligns with reality.
In 1945, American strategists recognized that a nation with half the capital stock of humanity had to rebuild the world. But we are not in that era anymore. It is not our job to fix the world.
Export-oriented growth means displacing the remaining Americans who produce things. It cannot work anymore. There's no other country with a giant trade deficit, by design. No one else will serve as the importer of last resort.
I don't agree with @Noahpinion's critique of Warren's trade plan. We should run our trade policies to benefit Americans, and we should run development policies to benefit poor countries. Let's stop offshoring jobs and production to benefit other countries. bloomberg.com/opinion/articl…
@Noahpinion Here's @Noahpinion: "The plan would require any country that enters into a trade deal with the US would have to meet the same environmental labor and safety standards as the US. And it would force a renegotiation of any trade deal that doesn't already include these provisions."
@Noahpinion I respect @Noahpinion a great deal because he's honest about the stakes. Our trade policies are designed to shift U.S. wealth abroad, and a lot of progressive trade thinkers believe that's a good thing. Most Americans don't.
1. Ok, what we need with airlines is straightforward government setting of routes and prices. Competition within the airline sector won't actually deliver better service, it will deliver bankruptcies and consolidation.
2. The economics and physics of air travel simply make competition around price impossible to sustain for long. It either becomes private price setting like we have today or public price setting like we had before 1978. washingtonmonthly.com/magazine/march…
3. Most energy is used on takeoff and landing, so it's cheaper per mile to fly long-haul routes. Also small airports are just more costly than big airports, because of economies of scale. So all airlines want to fly long flights to big airports.
“Boeing Commercial Airplanes clearly has a systemic problem in designing, producing and delivering airplanes,” said Scott Hamilton, an aerospace analyst and editor of Leeham News and Analysis.
postandcourier.com/business/airli…
postandcourier.com/business/airli…
I haven't seen a single Congressman mention the crisis at Boeing. I don't mean that the Max isn't a good plane, I mean the loss of the ability to make airplanes. This company is in serious trouble, and America cannot make planes now.
There's no language to really describe the political crisis we're in, because America has *always* been able to make things. We cannot do that right now. It's crazy. We just can't produce.
The real cost of Obama's failures is a collapse in belief all over the world that democracy can work. So yes, Biden can beat Trump. But can Biden govern? I don't think he can. And what that will mean is that autocrats will have an even stronger case democracy is a failed model.
Beating autocratic forces emerging worldwide and beating Trump are related but aren't the same thing. It's possible to beat Trump and long-term make things worse. Democrats find this unpossible but it's been the trend since Jimmy Carter.
If Obama had lost in 2012 to Mitt Romney, Trump would never have become President and Democrats would never have lost the Senate in 2014. There are worse things than losing an election. Winning an election and failing to govern, thus discrediting democracy as a system, is worse.
