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     Oct 22, '13

No castaways on the net
By Martin Hutchinson

How the new "sharing economy" weakens private property ownership and subverts workers' rights.

As tech becomes an ever more pervasive presence in our lives, old patterns of work, communication and human interaction are being profoundly altered. While the new technology has brought enormous freedoms in some areas, it has also devastated the ability of human beings to live their lives in an autonomous manner, free from interference by meddling government and social groups. In the world of technology, no man is an island, and we are the worse for it.

The Internet inevitably involves a certain loss of privacy. Each time you connect to it, your IP address is stored in the big servers, where it can be accessed by advertisers, governments and bad

guys. By knowing what websites you visit and what products you research, advertisers can tailor their offerings more closely to your desires, governments (less attractively) can check up on your contacts with terrorists or other enemies of the state (the level and type of surveillance depending more on the trustworthiness of the government concerned than on your own activity) and bad guys can do bad stuff. It's a gross intrusion into your privacy, but we have decided as a society that the convenience and use of the Internet makes that intrusion worth incurring, and only if you're willing to incur substantial additional inconvenience can you avoid it altogether.

However in this second phase of the Internet the invasions of privacy and restrictions on autonomy are increasing. One especially pernicious invasion is the software that now allows prying neighbors to look up criminal records and indeed arrest records for those not convicted of anything. Of course, in certain very restricted circumstances, such as convicted sex offenders and employers searching the felony convictions of their potential employees, it may well be appropriate for that information to be publicly available, and in many other cases it has been technically available at courthouses. However it is one thing for a nosey parker to have to visit the local courthouse to check the arrest record of a neighbor he's taken a dislike to, and quite another for him to be able to access that information with 30 seconds' effort on the Internet. Many people's lives are going to be damaged by this licensed intrusion, from adults with past periods of teenage wildness to families with members with mild mental disturbance. If this intrusion is to be permitted, there should be a substantial fee involved, preferably payable to the victim.

A more widespread problem in this second phase of the Internet is that of the "sharing economy" which, if adopted broadly, would severely weaken the already shaky foundations of private property ownership. A typical and at first sight benign manifestation of this trend is the Airbnb service, which provides a clearing house for apartment rentals, allowing visitors to New York City, for example, to stay in an Airbnb apartment rather than an overpriced hotel. This theoretically increases the use of resources and allows middle-class apartment owners to pick up some extra rent. In itself it is mostly benign.

The questionable nature of the activity becomes clearer when you examine Peers.com, a website describing itself as a "grassroots organization set up that supports the sharing movement." This claims, optimistically, that "Over 75% of those who share online say they have more trust in their communities".

For Airbnb, that makes sense-one doesn't have to be a giddy optimist about human nature to suppose that more than 75% of the human race consists of generally decent people who are no major problem to share a small apartment with for a few nights-the figure may even be as high as 90%. However, the attitudes of sharers may in reality be a little lopsided; while most people who use Airbnb just a few times may have no very bad experiences, even a few disasters can leave the other 25% of sharers with MUCH less trust in their communities, indeed outright paranoia.

The reality is that sharing your apartment with total strangers works quite well in small village communities, where there is little diversity and everybody either knows each other or has close connections with visitors. It is however much less sound in a big city, where all kinds of differing cultural norms interact and visitors from another city have little incentive to "play nice" if for some reason they don't want to. Large hotels with their impersonality are set up to handle this type of interaction; in a small apartment it all too often becomes an invasion of the right to autonomy of both parties concerned.

The ideology surrounding Peers.com is pretty unpleasant for those who believe in property rights. It quotes from one of the gurus of the movement, Lisa Gansky, claiming that the sharing movement is about "moving from a world where we're organized around ownership to one organized around access to assets." Again, for a believer in property rights this is pretty creepy; I don't want my ownership of land, property and favorite objects to be replaced with some kind of mushy "access" to such things. If everyone has access to assets, who pays for their maintenance?

We are already unpleasantly marooned in a society in which cellphones are replaced every year and personal property is breakable and ephemeral; the sharing movement pushes us further in this direction, weakening still further the bonds that have held our civilization together. Whether it's a Victorian Rectory, a 1958 Maytag washing machine, or a 1735 leather-bound volume of the Gentleman's Magazine, the best objects are well crafted and very durable, lasting centuries with proper maintenance. No "sharing economy" will look after them properly or provide a market for new objects of a similar quality, durability and appeal.

Gansky herself has had a checkered career in the tech sector. Her first venture in the late 1990s, Ofoto, was a service whereby you could store your photos online on Ofoto's servers. Well down in the small print, if you looked hard enough, you could find that Ofoto had the right to delete your family and wedding photos if you didn't spend money on Ofoto products in any given year. This indeed happened to a number of customers, who alas had no legal redress for their considerable psychological upset. That kind of creepy customer service is typical of the tech sector; it is depressing, not inspiring, to think that it is spreading to more and more of life.

The Financial Times' Evgeny Morozov last week lamented that the new sharing economy was subversive of workers' rights, so that Uber taxi drivers, for example, are not technically employees and can be "deactivated" at any time if customers don't like them-or presumably if the dispatcher doesn't like them. Once deactivated, the ex-Uber driver must incur the very considerable "networking" unpleasantness and marketing costs of finding another job, living on welfare while he does so.

Like most New Age contracts, the tech sector's employment arrangements work only in one direction for 90% of their employees. Needless to say, some lucky employees of these companies receive grants of stock options in their private, loss-making companies-and work 18 hour days, 7 days a week dreaming of eventual riches, with the majority of their remuneration in a form that would have contravened the 1831 Truck Act if Charles Dickens' Mr Gradgrind had tried the trick in his Victorian factory.

We are told by Brian Chesky, Airbnb's chief executive, that if we "don't want to be brands" and don't opt into an online identity, we'll have less access to services. Certainly that's true for the old, who for one reason or another have not adapted themselves to the Internet. For the rest of us, even by avoiding Facebook and the like we have not protected our privacy; the marvels of "cloud computing" and "big data" ensure that our data, unavoidably inserted into the ether to facilitate simple administrative and purchase transactions, is available to the world, much of which is scheming how to turn a somewhat dishonest profit by abusing it.

We laugh at Ned Ludd, who smashed stocking frames in 1813 in protest against the early stages of the Industrial Revolution. Yet Ludd's compatriots were made incomparably richer by industrialization, and the stocking frames made no intrusions into Ludd's private life (though the more paternalist employers attempted to). No doubt the giants of the tech sector would say that we are imitating Ludd by attempting to preserve the last remnants of our privacy and employment rights against their "sharing economy" schemes. At least Ludd didn't have to cope with New Age moralizing about how we should all prefer to have only "access" to our possessions and be happy to "build our brand" in the magic world of the Internet, in order to be able to enjoy even the simplest items of commerce.

The justification by the industrialists against Ludd was that Britons were being enriched by the new production techniques against which he fought. But ask yourself: are you significantly richer than you were 20 years ago, before the Internet became so pervasive?

If the answer is "no" then the "sharing economy" is a scam and should be resisted with all the Luddite force we can command.

Martin Hutchinson is the author of Great Conservatives (Academica Press, 2005) - details can be found on the website www.greatconservatives.com - and co-author with Professor Kevin Dowd of Alchemists of Loss (Wiley, 2010). Both are now available on Amazon.com, Great Conservatives only in a Kindle edition, Alchemists of Loss in both Kindle and print editions.

(Republished with permission from PrudentBear.com. Copyright 2005-13 David W Tice & Associates.)




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