Ruling Class - Oligarchs, AI, Boeing, and Justice
Oligarchs
The invasion of Ukraine, and subsequent seizure of assets Russian oligarchs had squirreled away around the globe, helped contextualize just how much of the country's money its elite few had siphoned off over the last three decades.
For those not familiar with history, after the fall of the Soviet Union the government privatized its various industries for pennies on the dollar, creating a handful of billionaires with a new attitude towards wealth:
The defining trait of this “new class of oligarchs”—as the [Russian] postelection coverage dubbed them—was that they seemed to want people to know they were oligarchs. [Boris] Berezovsky called his system “corporate government.”
Berezovsky bragged that the seven men with whom he'd captured huge chunks of Russian industry controlled half the country's wealth. Putin's rise only changed who had the money; the attitude remained the same - Russia's superrich weren't afraid to put it on display, buying yachts and buildings and soccer teams.
The problem with siphoning off a nation's wealth is it doesn't do you much good if you can only buy poor-quality goods produced by the people you're slowly starving. The Russians needed to turn rubles into dollars, in places that eschewed transparency and taxation. Fortunately, one such place existed:
By the time Trump took office, Russia’s ultrawealthy were storing 60 percent of their holdings offshore. Much of the money made its way to the same country that helped shape the Russian system in the first place.
Russian oligarchs were so impressed by what American robber barons had done in the late 19th and early 20th century, they couldn't wait to get their newly minted dollars into anonymous Delaware and Wyoming shell companies, where they could use them to acquire shiny new real estate being built in places like Miami and New York, by guys like Donald Trump.
Russian oligarchs worked openly with US investment banks, poured millions into the tech sector via venture capital funds, and donated lavishly to charities. For years, the government took the position that it was not our problem where the money came from, nor was it our job to impose any meaningful restrictions on what it could buy.
Now, many of the same oligarchs who once graced American high society are sending their megayachts on stealth missions to escape the authorities. They're selling soccer teams. Putin's unhinged nationalism has cost his pals their fame and some of their fortunes, but they must remain loyal, because the alternative is a slip in the tub or fall from a window.
We're led to believe that such savagery is beneath us - it couldn't happen here. We're a democracy! We have the rule of law! And, listen, if you read this newsletter you know the degree to which that is nonsense. Our society is more unequal than ever, our industries are controlled by a small handful of unaccountable companies who spend millions buying off our political apparatus, itself now stuffed to the seams with wealthy elites.
Whereas the Russians got rich extracting oil and minerals from the soil, American oligarchs have built an even simpler model for wealth accumulation:
Shoshana Zuboff, an emeritus professor at Harvard Business School, has written about a class she calls the “information oligarchs.” These tech giants like Google and Meta are driven by what she calls the “extraction imperative”—in which the entire scope of operation was built around harvesting your data and attention for the purposes of selling it or tailoring products. Your time is the precarious foundation of the entire internet economy, the basic unit upon which all else is organized. Reed Hastings, the executive chairman of Netflix, once said that his biggest competitor was sleep.
Zuboff is correct in that we are all doing shadow work for the advertising and data mining companies who take our behavior and sell it on to people who use it to sell us things we are fractionally more likely to buy.
Nineties Russians couldn't have dreamed up a better business model - distilling billions of hours' worth of free labor into unfathomable riches. Why bother mining nickel out of the ground, when you can sell ads to Proctor & Gamble for thirty bucks per thousand views?
The problem Putin and his oligarchs have run into was that an extractive economy can only go on for so long. Russian citizens have tolerated the excesses of their leaders for decades, but minerals dwindle, the price of oil will inevitably decline, and you've still got a hundred and forty million mouths to feed. You can hold all the mock elections you want, people will eventually take to the streets.
Invading your neighbor to strip mine its resources might have worked, if your robber barons hadn't spent years, well, robbing. If you can't win quickly and decisively you end up pulling tanks out of museums, face mutiny from within, and cripple an entire generation of young men, those who don't simply desert.
Likewise, we've seen Google's wildly profitable ad unit stumble as the company bumps up against revenue ceilings for its rapidly degrading search product, and Facebook forced to bribe investors to ignore the multi-billion-dollar hole it continues to dig in the metaverse.
What happens when American information oligarchs can't continue to grow at all costs? What if we stopped fueling their fusion reactors with our attention and clicks?
AI
A fresh example of the level of impunity with which our oligarchs operate is how quickly major corporations have rolled out AI. Despite their own admissions that their chatbots have m flaws and need to be constantly rolled back or updated, we're getting all our information-harvesting apps and devices stuffed full of AI whether we like it or not.
Just this week my web browser (Chrome) asked whether I'd like to turn on AI to help organize my bookmarks (?) add context to articles (??) or explain the news to me (???).
All of my Windows-based computers have force updated to include Copilot, an AI-powered whatever-it-is that I do not want and cannot easily disable. The Office suite I pay for as part of my job attempts to install assistants and bots at every turn. I did not consent for Microsoft to read my writing or spreadsheets or analyze my emails, but I'd need to put forth significant effort to disable any of it.
My phone is constantly attempting to AI-ify experiences that do not need to be turned over to a robot, like responding to a text or making a phone call. Ironically, my actual voice assistant I used to use to set reminders and meetings appears to have been broken entirely with these updates.
What is any of this for? Who asked for this? Why is Google building things called VLOGGER which any normal person could tell you are wildly unethical and will be used exclusively to make revenge porn and deepfakes?
The answer, in part, is that oligarchs have grown so bold because we have spent years glorifying their achievements and celebrating their vast wealth, and they truly believe they can do no wrong. That it is okay to consume the electricity of a small country to train racist chatbots whose sole value add is making your most obnoxious coworker's emails somewhat more intelligible?
Oligarchs aren't content to grow fabulously wealthy off our labor, they want to shape society itself. The jobs they believe AI will replace reveal their bleak view of humanity - teachers, nurses, historians, writers, musicians (and apparently coders).
I have no doubt that Google and Microsoft executives would assure us that they are not trying to get rid of all teachers or nurses, they're just trying to make their jobs easier and more efficient. But, by prioritizing chasing short-term share price bumps by embracing half-baked AI technology, they've spawned an entire ecosystem of 'entrepreneurs' who closely resemble the app economy hustlers who built hundreds of 'Uber, but for X' clones during that hype cycle and only succeeded in creating an entirely new working underclass.
But that's actually the point, isn't it? Our tech elites envision a world where everyone and everything exists to serve them, because that is the rarefied status they've attained through wealth accumulation. Gig workers seemed like the perfect servants, but they possess annoying traits like a sense of fairness and are agitating to be treated like something more closely resembling workers.
AI, by contrast, could be the perfect replacement. Finally, an employee that simply does what it's asked with a digital smile on its face. It even apologizes. So polite! Never mind whether what it's telling you is true or not.
There is one version of the story where AI is a cynical ploy by all the tech elites to grab hold of the next fad and ride it to new heights of wealth, or to plug existing holes in a business model that has become increasingly unpopular with the hoi polloi.
There is another version where they want AI to replace people, because people are the only thing standing in the way of a completely unaccountable future where no one shames you for cooking the planet with your weird toys or asks you to pay taxes or be in any way aware of the widespread misery you've caused in pursuit of a slightly larger yacht than your neighbor's.
Boeing
It is not only the tech oligarchs who believe they can operate with impunity. Other industries have consolidated to the point they no longer fear retribution or meaningful regulation.
You would think that being one of only two of the world's major commercial airplane manufacturers would prove a stalwart shield against criticism, but there is apparently enough of a shared fear of dying in a plane crash (despite it being the safest form of travel!) that Boeing finds itself in a real pickle.
I am a strong believer that we should be skeptical of the appearance of statistical outliers, but man it is hard to square that with the near endless stream of reports about Boeing planes fucking up.
We have discussed the myriad problems with the 737 MAX, Boeing's slapdash attempt to make a fuel efficient plane on the cheap to compete with Airbus. But, like, the rest of its planes seem to be falling apart too? 787s are plunging out of the sky, 777 wheels are falling off into parking lots, other 737s are showing up missing a few bits.
Is this wave of bad press simply a byproduct of additional scrutiny on the airline? It may be too soon to tell, but what is obvious is that Boeing's problems run even deeper than we thought, after it killed hundreds of people due to faulty software just a few years ago.
Rather than learn from that horrific tragedy and the accompanying fallout, Boeing has kept in place a production process on the 737-MAX that is so bad it failed almost half its audits in a recent FAA investigation:
For the portion of the examination focused on Boeing, the F.A.A. conducted 89 product audits, a type of review that looks at aspects of the production process. The plane maker passed 56 of the audits and failed 33 of them, with a total of 97 instances of alleged noncompliance, according to the presentation.
Listen, I do often think whilst flying thirty-seven thousand feet in the air to some faraway destination that it is a freakin' miracle humans invented planes. A multi-ton hunk of steel and fiberglass can not only get me to Paris in six hours, but I have Wi-Fi and a glass of wine? Incroyable!
It is therefore worrying to know that Boeing's production processes are about as finely tuned as the crews who've come to try and fill the same potholes in my street three times in the last two years.
Then there is the whole, uh, maybe assassination that Boeing did last week?
Police in Charleston, S.C., are investigating the death of John Barnett, a former Boeing quality control manager who became a whistleblower when he went public with his concerns about serious safety issues in the company's commercial airplanes.
Barnett's body was found in a vehicle in a Holiday Inn parking lot in Charleston on Saturday, police said. One day earlier, he testified in a deposition related to the string of problems he says he identified at Boeing's plant where he once helped inspect the 787 Dreamliner aircraft before delivery to customers.
Yeah, hmm, don't know about all that. We do not like to speculate around these parts about corporate assassinations but we can let the folks Quartz do it for us:
Now, though, a family friend of Barnett’s says that, before he died, he warned her that if he were found dead, it would not be the result of a suicide.
[...]
“He wasn’t concerned about safety because I asked him,” Jennifer told WPDE. “I said, ‘Aren’t you scared?’ And he said, ‘No, I ain’t scared, but if anything happens to me, it’s not suicide.’”
One thing I am quite certain of is that if anyone at Boeing or its associated companies ordered a hit, it will eventually come out, because there will be emails and texts, because people evil enough to believe killing one guy will save them from a lawsuit are very, very stupid.
Barnett's lawyer says the suit will continue, so the best case scenario is that Boeing successfully bullied a whistleblower into committing suicide during a deposition. The worst case is our business oligarchs have decided targeted killings are now on the table.
Justice
When a newsletter has gone down a particularly dark path, we sometimes like to talk about good stuff happening.
Last week, the Judicial Conference of the United States, which sets rules for the federal judiciary, changed its policies to put an end to 'judge shopping' which had become the de-facto tool among right wing legal groups to block federal and state laws by filing lawsuits in places they were sure to get a favorable judge. This made Mitch McConnell so mad he wrote a letter to a bunch of judges telling them not to follow the rules, which is not an instruction he really needed to make explicit.
Elsewhere, the National Associate of Realtors settled a class-action lawsuit for $418 million dollars, and agreed to new terms that will make it possible for home buyers and sellers to negotiate or avoid fees. It came on the heels of a massive jury verdict last year, and will upend the literal rent-seeking business of real estate agents nationwide.
And, last but not least, Donald Trump's lawyers told a New York appeals court that he can't come up with the money to pay a bond in his civil fraud trial, which would be required for him to file an appeal.
Legality aside, it is very funny to think about what could happen next - if Trump can't post the bond, does the NY AG start going through his assets to find any property that isn't mortgaged to the hilt? Does he even have assets worth half a bil? Will the court-appointed monitor put Trump on a restricted spending plan which he will most certainly violate? Would it be possible to bankrupt Trump with contempt fines alone? He certainly seems eager to find out!
Short Cons
NYT - "There were layers of history, with both Oprah and the intellectual history of bodies in pop culture. But, viewed at a distance and as a whole, the one-hour program was above all a harbinger of how the weight-loss industry is rebranding: Obesity is a disease, and — for the first time — it’s not your fault."
Insider - "French regulators say Google went back on its commitments tied to negotiating deals with news outlets in France for their content. The watchdog alleged Google used the journalists' content without telling them in order to teach its AI chatbot Bard — now rebranded as Gemini."
NYT - "Private equity — the industry responsible for bankrupting companies, slashing jobs and raising the mortality rates at the nursing homes it acquires — is making money by gobbling up the rights to old hits and pumping them back into our present."
Lifehacker - "In Dormann's example, an advertisement posted by a verified X user claims to lead to forbes.com. When Dormann clicks the link, however, it takes him to a different link to open a Telegram channel that is, "helping individuals earn maximum profit in the crypto market," he said. In short, the "Forbes" link leads to crypto spam."
Vulture - "The primary difference here, however, is that Irish Wish is a thinly veiled Trojan horse for the conservative agenda, a crypto-fascist work of art cluttered with right-wing dog whistles and dialogue that could have only been written by a malevolently programmed artificial intelligence."
CNN - "With the exception of Tesla, all of the Magnificent Seven companies (that also includes Apple, Amazon, Meta, Google, Nvidia and Microsoft) saw double- or triple-digit earnings growth in the final three months of 2023. Tesla reported a 40% decline in profit from the year before."
The Appeal - "At a conference attended by more than 1,000 law enforcement officers from across the country, Street Cop trainers urged police officers to make unconstitutional traffic stops and indiscriminately shoot at those who defy their authority."
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