Technology startups have become something of a fixture of the American economy. No longer the leading manufacturer of anything other than warheads, Internet hegemons like Google and Amazon have become the faces of American innovation and economic opportunity. Alongside these companies is an ecosystem of remora-like media outfits that purport to cover emergent technologies. Breathlessly, they will rush to tell you about upcoming Apple Vision Pro features or interview AI experts who insist the world will never be the same.
It’s not surprising why technology news is this excitable and disorienting. For one, there just aren’t that many media conglomerates in the world, and they’re all in stiff competition with each other, which rewards shallow reporting. As Noam Chomsky and Edward Herman point out in “Manufacturing Consent,” it’s much easier to write about a subject when you have a good ongoing working relationship with people involved and when your information is meted out at preplanned times and places (such as press conferences and trade shows). Media companies also push their journalists to report new announcements as fast as possible to appear high on search results and gain more ad revenue. These factors combine to create a press that is disastrously credulous.
Part of the issue can be found in the “Silicon Valley Mythology” of the 2000s and 2010s. As Internet access increased around the turn of the millennium, online startups like Facebook and PayPal minted billionaires out of arrogant white guys like Mark Zuckerberg and Elon Musk, whose “move fast and break things” mantra deified the concept of the hyper-intelligent Silicon Valley entrepreneur who knew more about the future than anyone else and wasn’t going to wait for everyone to catch up. Displays of extravagant wealth and movies like that shitty, revisionist Steve Jobs biopic starring Ashton “the Kutch” Kutcher further legitimized the exceptionality of these new tech wunderkinds and cemented the idea that Silicon Valley is a bastion of innovation, a chaotic environment from which earthshaking new technologies spring forth. You may not like Zuckerberg, but you really wish you bought Facebook stock in 2012, don’t you?
While these virginal Rockefellers live in the spotlight, another far more important figure is beginning to decline. The naysayer — the negative Nelly, the hater, the buzzkill willing to lash out against the false tech idol of the month — is disappearing, and they are needed now more than ever. As more and more of the national GDP is built out of smoke and mirrors, it becomes more important than ever to legitimize dissent.
Take the explosion and implosion of cryptocurrency starting in mid-2021. Crypto, a decentralized payment method that proponents say could replace the current banking system, had been around for years, but in 2021, it rose to never-before-seen prominence as bored, sequestered workers received their stimulus checks and used them to gamble. This influx of cash allowed “crypto exchanges” like FTX and Binance to portray crypto as the next great investment for regular people, and to begin to advocate for integrating crypto in the financial system.
The problem, however, is that crypto is a load of bullshit. As early as the founding of Bitcoin in 2009, problems were obvious. It was slow; it would be extremely expensive to facilitate any transaction if it ever became valuable; it was designed to be deflationary to make it an attractive asset for investors, which makes it a useless currency; it is extremely vulnerable to scams; and theft is impossible to undo. Crypto is not a coming revolution in finance; it is a new type of Ponzi scheme where early buyers try to tell the most exciting tale about future value they can so they can resell at a high price to newcomers.
This did not, however, prevent major outlets from heaping positive coverage upon the “revolution in digital money.” One explainer in The New York Times from 2021 raves about interest rates “100 times higher” than conventional banks while providing scant discussion of risk other than mentioning the possibility of “cyberattacks, extreme market conditions, or other operational or technical difficulties,” quoted directly from BlockFi’s fine print.. A different NYT piece is chock full of anecdotes of early adopters who put their faith in crypto and were rewarded with millions, with a tagline stating “Bitcoin and other cryptocurrencies have gone from curiosity to punchline to viable investment.” With favorable coverage like this, institutional interest from firms like Morgan Stanley and Goldman Sachs, and ads during the Superbowl, it did really seem like crypto was the future.
That future, however, wasn’t meant to be. After the mainstream was pulled into crypto by flashy headlines about its sometimes staggering returns, the price of almost every cryptocurrency crashed in Jan. 2022 as the Federal Reserve raised interest rates, investment slowed as holiday bonus/gift money dried up, and lending schemes caused a fluctuation in the price of “stablecoin” Terra, which caused a bank run that wiped hundreds of billions of theoretical value out. With the subsequent bankruptcy of FTX that same year, both private and institutional holders like Ontario’s public teacher’s pensions got taken for billions cumulatively.
Naysayers saw through crypto long before major outlets switched from penning ads to obits. Writing in Current Affairs in April 2021, Nathan J. Robinson, the magazine’s editor-in-chief, called crypto a “giant fraud,” after closely examining the actual technology “all of the grand claims for it fail entirely.”
This same criticism was made by Paul Donovan, the chief economist for UBS Global Wealth Management, who said in Jan. 2021 that Bitcoin and other cryptos could never become real currencies because users couldn’t rely on it to hold a consistent value for the purchase of goods and services. “People are unlikely to want to use something as currency if they’ve got absolutely no certainty of what they can buy with that tomorrow,” Business Insider quoted him as saying.
Instead of buying into the hype, these writers and others looked at the actual usefulness of the technology and pointed out the naked emperor long before everyone else stopped complimenting his robe.
The point of all this is not to say “I told you so” but to perhaps allow you to say so to others. Now that generative AI is the hot new thing, we should all be careful about falling for big promises and pronouncements from companies that desperately want venture capital and unrestrained public excitement. When companies try to brush over generative AI’s problems with hallucination, colossal use of processing power and electricity, encroaching limits on how much more it can improve, and the core problem of what the actual, real life, worth-spending money-on applications of it will be. There are many reasons to be critical of generative AI that aren’t just fear mongering over how it may be too good at things. The future is not brought to bear by Palo Alto Prometheus.
We are in times of tall tales and snake oil. Do not be afraid to listen to the naysayers, and certainly don’t fear becoming one.
