Early in Google’s history, an executive suggested that the firm adopt the slogan “Don’t Be Evil.”
It was more than a motto; it was a mission statement for the new “masters of the universe”, as Tom Wolfe described Wall Street over a decade earlier – a group of geeks stationed 3,000 miles away from New York’s corporate excess and malfeasance.
Tech’s take on capitalism was informed more by 1960s counterculture and the hippies who gathered a few miles north of Silicon Valley at Haight-Ashbury in San Francisco. Contrary to Gordon Gekko’s infamous 1980s mantra, for web companies catapulted from California garages to the New York Stock Exchange, greed wasn’t “good” – and it definitely wasn’t cool.
But as Apple, Amazon, Facebook and Google have become some of the world’s richest and most powerful companies, their well-intentioned capitalism has begun to resemble the ruthless corporatism more commonly associated with giant banks, insurance firms, and energy companies.
This colder, meaner Silicon Valley is on display in a front page article of Sunday’s New York Times about the intensely high demands placed on Amazon’s workforce by CEO Jeff Bezos. As the e-commerce giant continues its ambitious play to sell everything to everyone all the time, current and former employees bemoan long working hours and an expectation that workers be available 24 hours a day to answer emails.
Staffers are encouraged to send negative feedback to management calling out behavior that’s below the company’s impossibly high standards. And pity employees who suffer a miscarriage or cancer diagnosis, as they are said to find little sympathy from bosses or colleagues.
But another tech bubble has burst. The idea of tech employees slaving away miserably runs counter to the image of Silicon Valley propagated by pop culture and the companies themselves, in which workers inhabit utopian workplaces, are fed by gourmet chefs, and spar over ping pong tables and classic arcade machines in recognition of the relationship between play and creativity. Sure, tech employees work as hard as they play. They do, however, in order to happily share in the glory (and profits) of their corporate overlords – or so this narrative suggests. It’s an idea that took hold in the 1950s at the prototypical Valley firm, Fairchild Semiconductor, after it made every employee a shareholder in a then-unprecedented move. Nowadays many tech workers – at Amazon and elsewhere – feel less like the fire fueling engines of innovation and more like cogs.
While Amazon’s treatment of workers may be perceived as unfair, it doesn’t appear to be illegal. The same cannot be said, however, of a massive scheme led by Steve Jobs – who, to many, is a paragon of Silicon Valley excellence – to drive down the wages of employees at Apple, Google, Intel, Adobe and others in the 2000s. Jobs and then-Google CEO Eric Schmidt had secret, felonious agreements in place to not poach each other’s engineers, allowing them to artificially keep wages down. According to Pando Daily’s Mark Ames, so ruthless were these agreements that Jobs, after receiving word that Google fired a recruiter who tried to court one of Apple’s engineers, responded with a smiley face emoticon.
If Big Tech’s treatment of salaried employees isn’t always great, then its treatment of contractors, particularly by so-called “sharing economy” startups like Uber and Airbnb, is often atrocious. Although these firms push a narrative that they empower small business owners, their platforms are structured to leverage millions of workers without having to comply with labor laws. Despite operating as employees, Uber drivers do not receive insurance benefits, compensation for day-to-day expenses, nor job security. In turn, Uber has fought efforts from drivers to unionize or reclassify themselves as employees who are afforded the same protections by law as more “traditional” workers. Airbnb, meanwhile, has taken a less overtly adversarial approach toward its hosts, but has in the past been reluctant to compensate renters when guests incur property damage.
Tech companies are also complicit in controversial practices more historically associated with older, less egalitarian bastions of American capitalism – like absurdly high CEO-to-worker pay ratios which, according to former US secretary of labor Robert Reich, contribute to America’s worsening income inequality problem.
In 2011, Apple’s chief executive Tim Cook made 6,258 times as much as his employees. In 2012, eBay’s John Donahoe made 656 times more than his employees, and Oracle’s Larry Ellison, despite receiving a salary on paper of $1, took home 1,287 times more than workers in the form of stock options and other awards. Granted, tech CEO pay is often calculated with greater emphasis placed on company performance than in other industries. But many experts doubt the efficacy of pay-for-performance incentives.
Tech firms are also among America’s worst offenders when it comes to tax avoidance. According to the advocacy group Citizens for Tax Justice, Apple holds $157.8bn in profits offshore – more than any other Fortune 500 company. Much of this cash is held in tax shelters like the Cayman Islands, where the corporate tax rate is virtually zero. That’s allowed Apple – which is now the most profitable company in the world – to pay an effective foreign tax rate of only two percent during the last fiscal year. The amount of public works that could be funded if Apple kept a fairer portion of its profits in ths US – where it sells more iPhones than in any other nation – is astounding.
In 2013, Google’s Schmidt was criticized after revealing in an NPR interview serious doubts about the “Don’t Be Evil” motto. While many expressed sadness over Google’s admission that kindness is not a viable business model, others found Schmidt’s honesty refreshing. By the 2010s, only the most naive consumers could admit that Google cared more about doing good than making profits.
Just as some of Silicon Valley’s founders did back in the day, advocates of corporate responsibility and opponents of income inequality would love nothing more than for the new corporate gentry to operate with more kindness and goodness than the robber barons that shaped American capitalism. But let’s not kid ourselves: the new boss is the same as the old boss.
This article was written by David Holmes, for theguardian.com on Tuesday 18th August 2015 14.23 Europe/Londonguardian.co.uk © Guardian News and Media Limited 2010