The urgent need for Silicon Valley to lead a smart and civil conversation on inequality

[applegrove]

The urgent need for Silicon Valley to lead a smart and civil conversation on inequality

by Vivek Wadhwa at the Washington Post

https://www.washingtonpost.com/news/innovations/wp/2016/02/10/the-urgent-need-for-silicon-valley-to-lead-a-smart-and-civil-conversation-on-inequality/

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Income equality is not going to improve; technology is about to make things much worse. It will, over the next decade, begin to disrupt almost every industry, wipe out millions of jobs, and make the rich even richer. Even though everyone will be able to live better and healthier lives and benefit from the technology advances, the widening gap will cause greater resentment and create a larger cauldron of dissent. This is something we need to be prepared for.

Already, in Silicon Valley, the Google bus has become a symbol of inequity. These ultra-luxurious, Wi-Fi–connected buses take workers from the Mission district to the GooglePlex, in Mountain View. The Google Bus is not atypical; most major tech companies offer such transport now. But so divisive are they that in normally liberal San Francisco, activists scream angrily about the buses using city streets and bus stops, completely ignoring the fact that they take dozens of cars off the roads. Teslas have also become symbols of the obnoxious technoelite—rather than being celebrated for being environmentally game-changing electric vehicles. In short, there’s very little logic to the emotionally charged discussions.

Intellectuals are trying to build frameworks to understand why the divide, which first opened up in the 1990s, continues to worsen. Thomas Piketty explained in his book Capital in the Twenty-First Century that the economic inequality gap widens if the rate of return on invested capital is superior to the rate at which the whole economy grows. His proposed response is to redistribute income via progressive taxation. A competing theory, by an MIT graduate student, holds that much of the wealth inequality can be attributed to real estate and scarcity. Silicon Valley has both: an explosion in wealth for investors and company founders, and a real-estate market constrained by limits on development.

So far, the Valley’s moguls have largely been in denial that technology will wipe out millions of jobs and increase inequity. They prefer to believe they are building a utopia that doesn’t have a dark side. But one of the most influential people in Silicon Valley, Paul Graham, broke ranks and wrote an essay about the role of start-ups in income inequality. It created a firestorm and started an important debate.




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