Thursday, March 24, 2016

Is a startup different from a tax shelter?

In Tom Slee's new article in Jacobin, he says that Uber's "current business depends not only on pushing all the risk onto individual drivers, but also on avoiding taxes (in non-US countries) through a 'Double Dutch' subsidiary arrangement."

As a thought experiment, what if: the Double Dutch comes first, and oh yes, it also happens to be about cars?

The whole point of PE and the LBO story is a change in the ratio of a business "doing something" to Slater/Walker saying "we're in the business of making money, that is what we do," and the use values of what the business is about are secondary. The attributes being assessed are financial attributes, not subject matter attributes. If subject matter attributes are assessed, this will be in context of their being ensconced by what they mean as financial entities, or as vessels for money laundering, etc. So this has a relationship with how portfolio companies are used and how they are approached. A portfolio company could be a PE's portfolio company or a VC's portfolio company. The idea is that subject matter follows finance. This is why the outcomes have been so perverse - like Magnetar, the funders of portfolio companies may profit off of failure rather than success. But when you're advertising to the general public, the logo will be associated only with subject matter and the public will think that subject matter is what it's about. It benefits the financier for the portfolio company to be seen in light of what it does. For Guitar Center to be framed in terms of music first, and finance second, rather than how the financier talk amongst themselves about the thing, which is ROI first, with musical instruments. For Curves to be discussed in terms of "exercise" rather than money - for Arctic Glacier to discussed in terms of "ice" rather than money, gives the financiers years' worth of a head start in which to operate. Or for the excitement of high-tech VC to be based on something supposedly real, (like communicating quickly over long distances or using platforms to match a need with an availability,) rather than a sales pitch that says that the perception of these amazing things is an excellent way to raise money, gives the financier years' worth of a head start. His adversaries are going to be gummed up in subject matter for years before they even remotely get a clue! As long as we're still talking about subject matter, we can be misdirected more easily. The overall theme is a differential between the controllers' ability and knowledge of disingenuous and instrument-like application of attributes to a finance venture (with subject-matter accents,) and the blinkered, narrow way that the people on the receiving end (the public, the press, regulators, advocates) will guilelessly assume that if it quacks like a duck, it is a duck. If no one has ever heard of Kalanick, Zimmer or Busque before, and they say they're new people with a new entity doing new things then gee, it must be true. If it says on the billboard that it's about cars, it must be about cars. And if someone wants to raise a possibility that it isn't true, this is going to take years to assemble, which gives the company several early years of opacity and no one bothering them. We should address the entire engine, and we should do it early in the lifecycle, and not just late. And we should use the past precedent of one wave of portfolio companies - deaths, rapes, assaults - to judge the hot new startup of 2020. They didn't just pop out of the womb - grizzled old veterans from Kleiner Perkins use baby MBAs as a puppet, in order to attain "benefit of the doubt" and a perceived "newness" from the public.

Saturday, May 10, 2014

Vincent Chen

I have an ongoing curiosity and unanswered question about the interrelation between the nonviolent movements (say, the Kingians or Gene Sharp) and the tepid-ization of organized labor relative to the hard-edged sitdown strikes and other strikes in the early part of the 20th century. I don't know enough about it and would like to find out about it from two angles. One is as a historical matter. I'm curious how they talked to each other, if they talked. The second angle is whether there is an argument, either from efficacy or morality, that would promote a particular approach to nonviolence during a strike, and what the arguments are for and against. It is a strange thing to be looking at in 2014. The first question is, "what strikes?" Labor is in a pretty miserable state of affairs. Then you have the actions by, let's say SEIU. Several militants I know who I have a very high regard for, are extremely critical of these short strikes, which (either I am asserting, or my friends are asserting, or some combination), are intended for the press coverage or for a lame sort of "moral witness", rather than DOING THE THING ITSELF, namely, stopping production and making the target lose revenue and agree to workers' demands (redress of grievances, proactive measures to improve things, or both) because they are losing revenue. Now, I think there are a few things conflated here and I am not positive they are the same. Kingians tend to be from the liberal/progressive end of Christianity, asymptotically approaching Dorothy Day. "witness" is a Christian phrase, as in, the phrase from a gospel or soul song, "Can I get a witness???" A Kingian I know (who I also have tremendously high regard for) was describing a waterboarding protest where someone was going to deliberately undergo waterboarding as a "powerful form of witness," which I think is a little presumptuous. But that's what it's like to be an atheist among Kingians- they use their vocabulary and phrasing, and it's unlikely you're going to criticize them because they are so relentless in their civil disobedience and the degree of their selfless devotion. This is another facet of this topic: that the idea of moral witness suggests that the person is going to do it til the day they die, and this is sort of appropriate for a problem that is gargantuan and probably can't be tackled by mere materialists. So I think there may be some sort of correlation where labor has calcified over time and is now locked in to labor-law rules over how they can behave within what is sanctioned, or face huge fines if they go outside of it. I think this may correlate somehow with this questionable tactic of trying to push society through shame or sympathy, as though the SEIU's of the world may use this because they can. But I don't know the reason. Recent articles have described indifference and mismanagement in the fast food and Walmart campaigns. They're bought... they're wrapped up with the Democrats.... they're used as a way to keep labor in a box, making sure it has no teeth. How did this happen? I found out a lot about this from Joe Burns' great book, _Reviving the Strike_. It is decades of repressive court decisions, beginning with Taft-Hartley's prohibitions on secondary strikes, on through the court decisions on management being allowed to permanently replace strikers, and many others. And Burns' core point is, the production-stopping strike! Bring it back! Stop abdicating the power! So here are my two angles: trying to get the facts on how these two things evolved and whether they were in conversation with each other, and then whether the Sharp/King adherents have anything *particular* to say about nonviolence in labor relative to nonviolence in, let's say, the decision on whether to have an armed struggle against a dictator or a nonviolent struggle. The former is more subtle. The former can take place in the neoliberal aftermath once you *have* brought down the dictator. For instance, after apartheid, South Africa is part of a vast, bland, neoliberal story. My heroes. Instead of one gigantic story against Ceaucescu, you have labor struggles, economic struggles. Here I also need to bring in Chris Hedges and the video'ed debate between Hedges and the guy from Crimethinc. I listened to Hedges around this time and I found his argument persuasive. Armed struggle rots you away on the inside. If I have Hedges correctly. It seems like a good approach, yet there is an argument for not doing it on the basis of effectiveness, because it elevates those who are good at violence and I think Hedges is saying this narrows who can feel comfortable in the movement, and how they will be treated. It elevates bullying, because those in a militia who are good at fighting the enemy will be good at intimidating the members of the movement who don't happen to make good guerrilla fighters. I guess the elevation would be a sort of increased social standing based on their accomplishments. If the fabric of what goes on, what people talk about, and the axis of whether you are making gains or suffering defeats is put in military terms, the axis for figuring out who is putting a 110% effort towards winning is based on a war lens. The others will be second-class citizens in the movement. The thing I have not seen expressed is whether Hedges, or anyone else, is asserting that this achilles heel of a "militia" mindset applies to something like this passage from Burns: "During the great textile strike [of 1934], 'flying squadrons' went from mill to mill, forcing owners to shut down and suspend production. Although the squadrons were mainly non-violent, 'the characterization of the squadrons as "peaceful picketing" misses entirely their character as extralegal enforcers of justice. Swiftly, militantly, the squadrons were not only picketing but forcing the closing of mills. ... Historian Irving Bernstein describes a key battle [now talking about the 1934 Teamsters strike] ... dubbed the "Battle of Deputies Run": "The pickets, more numerous and better armed with clubs, baseball bats and pipe, won control of the market place within an hour. The fighting then spread over the city as the pickets pursued the disintegrating police and Citizens' Army remnants ..."'" And two other quotes come to mind that just set a backdrop level of attitudes towards the usefulness of violence relative to the possible self-destructiveness. One is from Frank Bardacke, author of _Trampling Out the Vintage._ In a talk, he mentioned that the farmworkers had a past history of doing things like "beating up the foreman." The other famous quote, I'm trying to find the source for. I have heard it at least twice in conversation. It involves the phrase "hit 'em with a brick." I think it involves the racial integration of the ILWU. If I have this wrong, I apologize, but the point I am getting at is a nonchalant entertaining of an ends justify the means approach to extralegal enforcement of justice, which is fine if you are right, but my anxiety is that labor is just as subject as Hedges' militia or a drone pilot to the fog of war: mistakes, false positives, disingenuous abuse. The third quote is something like, the ILWU leaders were faced with an influx of African-American and Asian workers. Someone (I wish I could attribute this), says, "if they don't ????, hit em with a brick. Otherwise, sign them up into the union!" The framing of the story is often in terms of making a point about the laudable anti-racism of the ILWU and of Harry Bridges. The quote about the foreman, the quote about hit em with a brick, and the Burns quote is my evidence, among other evidence, that either that the rot Hedges describes doesn't occur in a solidarity situation ( and if not, my curiosity is to know why not?) or it does, but we don't pay attention to it (and if we don't pay attention to it, maybe this could bite us.) I'm probably misinterpreting King and need to read more about what actually happened. The militants I know are pretty disdainful of MLK and they may have a point. I suspect that the passage of time has made nonviolence in the civil rights fights seem different than it was. I recently tried to argue to a friend that the left is as subject to false positives due to fog-of-war, accidental and deliberate false positives as the right is and that it would be equally perilous to act on the basis of a belief (seeming a bit religious to me) that the banal things will go well because we're right on the ideas. I suggested to my friend that when someone fighting police brutality or fracking or unionbusting delegates to another activist the banal task of going to Kinkos and making 200 fliers to hand out, the project has an equal chance being marred by incompetence, mistakes, or fraudulent mischief (say by an agent provocateur), as when an "activist" for Westboro Baptist Church, dealing with the banal matters of putting their demonstration on, delegates to *their* co-congregationalist or whatever, the banal task of going to Kinkos to copy the fliers for the next day. There's nothing about the fact that I like and agree with progressive values that should lead to a suspension of disbelief towards the possibility of false positives either in the boring mechanics of getting a project done, or even in our susceptibility to the fog of war. Another thing I need to get down here is the argument by labor militants about the sheer overwhelming force of the other side. Cops use overwhelming violence in allowing scabs to cross picket lines. I take their point. These friends - who have a deep and profound CLASS analysis above all - also pointed out that my dichotomy is naive, because there are many kinds of violence. "Poverty is violence," said one. Another asked me if I had ever been fired - and led off of the work site on the spot. My question is, does being outnumbered, outgunned, does the fact that in the case where someone has been killed, it is surely a picketer being killed by cops, change the rot and trauma of beating up the foreman? Does the fact that we're doing it for a righteous goal matter? The Latin American or Bosnian militias that Hedges saw-- they were doing it for a righteous goal as well. Probably trade union freedom was one of the things they wanted to win. (if neoliberalism didn't get there first.) Here is a final passage from Burns which I think suggests not that nonviolence is superior, but that the left is not immune to false positives in the fog of war. "...when the U.S. auto industry came under assault from the import of lower cost Toyotas in the early 1980s, unions responded with appeals to U.S. nationalism in an attempt to persuade consumers not to purchase Japanese automobiles. Rather than devising a strategy capable of combating capital, the United Autoworkers instead fostered racist xenophobia, as groups of angry autoworkers would bash Toyota cars with baseball bats. Ultimately, the attacks degenerated into the exact opposite of the international workers solidarity required to confront global corporations. The level of venom reached such heights that a Chinese-American man in Detroit, Vincent Chen, was beaten to death by autoworkers in 1982 who believed he was Japanese and somehow to blame for the loss of their jobs."

Vexatious litigation Although the examples given in this wikipedia article sound like what they say, this little alcove of a topic raises issues around false positives. It would be unlikely that someone would be fraudulently added to "a list" that barred them from using the courts - and/or forced them to represent themselves because attorneys could themselves get in trouble for representing them - yet the severity of being on a list that bars you from using the courts is pretty freaking severe, and the U.S. now has NDAA and other dumbfoundingly bad and dangerous anti-terror measures. So it should not be discounted that a way of protecting society from "bad faith" litigation could itself be riddled with either accidental or disingenuous usage. Especially if the effect of the blacklist itself was a catch-22 situation where the person was then unable to challenge having been put on (by using the courts.)

Saturday, December 28, 2013

The Ten Ninety Nihilists

From September 2012 until July 2013, I didn't write on here very much because I was writing an article for the Real News.  It's about independent-contractor status and the tech industry.  I'm proud to say that it ran on Real News at the end of September! And thank you Gifford- it also ran on libcom. Also, very proud to get linked by Naked Capitalism and Tom Slee. Also on a similar theme just a couple of weeks after the story ran, along with my friend Patrick I co-curated an Occupy Forum about disruption, precarious employment and the tech boom, with Darwin Bond-Graham of Counterpunch and Occupy activist and Wobbly Ryan Smith. Thanks to friends who supported me when I was talking about this thing for a year and a huge thank you to my sources. I want to do a something next, but I'm not sure yet what that will be.

Saturday, June 29, 2013

More on that certain tone of voice

I've just been reading about the meetings between George Gilder, Esther Dyson, Newt Gingrich and Alvin Toffler, in Fred Turner's great book From Counterculture to Cyberculture. I inhaled it in 5 days. Actually, I read Gary Weiss, _Ayn Rand Nation_ , Kim Phillips-Fein's _Invisible Hands_ and Turner, all in succession! In about as fast a wave of reading as I could possibly do. I have notes. But here is a quick thing on that certain tone of voice from business. It's the difference between the main event and the sideshow. Suppose you are making arguments for trickle-down and saying there will be a second half where there are lots of positive consequences for a lot of people, but at the same time, you're charging a fee for the whole thing, which frankly, could perpetuate you on its own. This is the whole reason why it's important to look at vested interests. And there is an interesting bifurcation-- let's say you're calling for deregulation, and you're promising great things will happen. You can break up the person doing the telling according to (a) true believers (b) complete liars (c) people who are in some stage of self-delusion. It's more complicated, because maybe you have digested the idea of cognitive dissonance as part of the "can't make an omelette" concept. Rhetoric is a way of attaining your goals, just like everything else. So there's no such thing as lying. It is all part of getting your goal, which also happens to cement you as a winning personality, or a Randian hero: the sort of person who isn't afraid to GO FOR IT! According to Turner, Dyson, Kelly and Barlow's writings "fairly ache with a longing to return to an egalitarian world." So they mean it, supposedly, though they also have lots of financial confounds where they might just be sufficiently tickled that they're doing so well for themselves by telling tall tales that they rationalize any amount of cognitive dissonance. Probably not.. Turner has read the primary sources and I doubt he is wrong. There are lots of complicated intermediate forms of partial delusion, too. Phillips-Fein had a great phrase about the business conservatives, trying to persuade workers that unions were harmful. She's talking about 50s and 60s conservatives, not about the dot-com period, but the phrase is extremely interesting for both: "They believed that the market had given them their power and that the market was inherently democratic. They saw themselves as populists. In many ways they were disingenous even with themselves..."

Saturday, June 8, 2013

Notes on a particular tone of voice from business

I want to get this down before I forget. It has to do with corporate attitudes towards inconvenience or harm to a small number of people. They are setting their own contextualization about the needs of the many outweighing the needs of the few. So there is a message like "we apologize, but this kind of thing is bound to happen given the volume of people/transactions/information that comes through our thing every day." Suppose this isn't true, though. One thing is for sure - they will never contemplate the fact that they actually ought to shut down, or that the harm has outweighed the benefit. No company ever comes to that conclusion. Massive volume could be a smokescreen, potentially. Either as a way to shrug off neglect, or as an excuse and a form of plausible deniability towards a fraud they are quite aware of as it is going on. We ought to be constantly savvy towards situations where the real story is portrayed as a side story. For example, take a fraud having to do with trying to sell unemployed jobseekers a list of job listings. Or other work schemes that involve upfront fees. I think it is sometimes taught as part of Critical Thinking 101 that you never, never, never participate in this. Because these fees actually ARE the core of the scammer's business. If a person is familiar with the fonts/typefaces and the use of hyperbolic claims and other weird attributes of job-related things that are completely un-credible, they might escape unscathed but unfortunately, many people will probably get embroiled in employment scams especially as unemployment remains high. So it's very important to take a look at whether large, established business can engage in a modified form of these schemes. This whole bit of writing that I am doing on this subject is kind of unformed so I want to get the anchor down and revisit it some other time. But here is the basic skeleton of what it's all about. It has to do with the cloud. It runs on volume of people and permits a shrug of the shoulders towards the well-being of any one person. A lovely employment attorney I interviewed last year used the phrase "skimming off the applicants," in regards to Amazon. It probably gets portrayed as a way to make money. It is a turnkey business for the makers, because they have no responsibility for whether or not anyone actually does make money. The term "not a good fit" can always be applied to anyone after the fact. Again, plausible deniability. The participation of the gullible novice is important. You take something that under the hood has nothing to offer, is economically non-viable, and say "what have you got to lose, why not just try it for a short time, with no obligation?" The person being targeted joins up, and in one way or another, provides something for free. It could be an upfront fee, or, it could be participation in a so-called "Web 2.0" website. The subtext of Web 2.0 is that it's attractive to an investor because the costs are reduced by the fact that users create free content, users consume content from each other, and possibly the proprietor makes money through advertising. A story is told about the importance of your social standing and the respect that is afforded to your opinions. Which makes people get the urge to create a bunch of opinions, which are now somewhat fake and made of air, since the pacing was forced. The cart is leading the horse. And also, the work that the person does is done in this environment of work now at the outset, for a promise of future rewards. This is the sleight of hand. The churning present is the real story, not the pot of gold at the end of the rainbow. Suppose it's 2050 and you have a crowdsourced telesurgery service. Surgeons from all over the planet are vetted for their qualifications and the top applicants get the privilege of joining the crowdsourced telesurgeon. The telesurgeon will act through a robotic drone with degrees of freedom comparable to the human body. When a surgery begins, doctors can participate in particular decisions of what to do next, in return for a penny reward. Through the use of massive redundancy, an action (like moving a scalpel five more degrees to the left) only takes place when 99% of the doctors in the crowdsourced telesurgeon have agreed. The quality of the surgery, when redundancy is used in this way, has been shown to be equally as good as having a real surgeon present. The patient doesn't even have to pay the penny reward to those doctors who made an incorrect choice. (Incorrect is defined as going against the consensus.) The proprietors of the telesurgery company are hailed for creating jobs. And the system is so popular (since work for non-crowdsourced doctors is faltering) that anyone who quits will be easily replaced by "skimming off the applicants."

The new FISA directive and the PRISM story

The Prism story brings my preoccupation with silicon valley together with my preoccupation with false positives and the GWOT. Both of these revelations are awful. Are they going to be received with a shrug? The story of unauthorized location tracking on the iphone was received with a shrug. Warrantless wiretapping was received with a shrug in the sense that Obama voted for FISA and we supported him anyway, plus there wasn't enough outcry for impeachment of Bush/Cheney to make Conyers do it. It seems to me that by shrugging at privacy violations, we are painting ourselves into a corner not only for the present moment, but for the future too. The story of living standards and the basic progressive priorities is just awful. Do we not need some privacy in order to fight these fights? I don't know. Maybe not. Janet reported on Occupy Wall Street after she visited last fall, and she said that there was this move towards radical transparency. The Occupy planners held their meeting on the steps of the police department. If you want to know what we're doing, come and find out. It seems like a Gandhian way to do things ... I have merely seen the movie, and haven't read about him, which I plan on doing eventually, but Gandhi I don't think cared if the cops knew what and where he was going to bring his people to make salt or something else, because they were going to walk right into the line of fire. Was privacy important to Gandhi or MLK? It's not a rhetorical question - eventually I am going to read the histories and find out: Is there anything about our present relationship to information and surveillance in 2013 that would make the Indian independence or civil-rights fights untenable or more difficult? Or does strong encryption take care of everything anyhow? My worry and irritation is that people who fight on principle like Bruce Fein don't have enough ordinary centrists with them. It doesn't mean Fein is wrong, but without numbers of constitutents, the politician just does the cost-benefit analysis and says "I can afford to ignore Fein." My other worry and irritation is that if progressives don't get out in front on civil liberties, libertarians like Rand Paul become the voice of sanity and might get the executive branch and more seats in Congress. Which sounds great on war, drones and surveillance, but their domestic policy is fucking heartless and always has been. And economic issues is what makes people do things that get them surveilled! When Rand Paul filibustered over drone strikes, the heart of civil liberties protection swung to the RIGHT. I called Senator Boxer's office and made the above objection. Cross your party! I want you to be the ones crossing Obama because if you don't, the libertarians will and that's horrible for labor law and workers' rights. The center doesn't seem to care about any & all surveillance. We need to connect it with household economics better. There are going to be more Occupys, and they are going to be fighting over the cost of a loaf of bread, the minimum wage and the fact that minimum wage is a moot point when you're 1099 in the first place. And they're going to be fighting over downward mobility and the impossibility of getting by. And surveillance is going to be turned on THEM, and they're going to be muddied together with terrorism, just like union people in the Red Scares were portrayed as the enemies of the USA. It was something business could get away with. This needs to be emphasized more: the use of surveillance by the U.S. government is really the use of surveillance by business, because of this parallel story of Senator Durbin's remark, "the banks own this place." If the banks own this place, the banks can exert influence over how and where the NSA's resources are used and they can go after whoever they want. It won't be about terrorism - it will be about squelching the economic fights and the workers' fights.