Power flows

The technology transforming society will exacerbate existing problems such as inequality unless we build a vision of the future that is experimental and powered with civic energy

by Anthony Painter @anthonypainter

When the General Motors factory in Janesville, in the US state of Wisconsin, closed in 2008, it left a community in crisis. The factory lay at the heart of the city’s economic and civic life. With good working-class jobs, a sense of identity, belonging, security and stability, Janesville had been the quintessential late 20th century industrial community. There was little warning. Almost overnight, the financial crash hit and production stopped.

The individual stories behind the statistics, brought to light in Amy Goldstein’s book Janesville, show vividly what happens when security flips into insecurity. Although Janesville has now recovered economically, with unemployment back to pre-crisis levels, thousands of families still bear scars. Political and local systems responded with income support, charity, funding for re-training, support for access to work, and much more, but even these efforts felt insufficient in many respects. The reality of insecurity for many affected was humiliation, addiction, family break-up, much lower wages, house foreclosures, depression, anxiety and, for some, despair. It is difficult not to admire the resilience and determination of the families at the heart of Goldstein’s brilliant observation of people at the sharp end of economic insecurity and collapse. But, as individuals, as a city, as a nation, there was little in place to ensure that, should a crisis hit, sufficient support to enable adaptation was in place. Action was reflexive and reactive rather than security being embedded.

The lesson from Janesville is simple. When change comes, you need continuous and resilient systems of support and adaptation to already be in place. Janesville was a sudden-impact event, but slow-impact change such as from the hidden adoption of new technologies over time can be just as devastating, even though these shifts can be more individualised, geographically diverse and silently disruptive. Increasingly, it would appear that we are in the midst of a change event that will have both sudden and slow-impact consequences. The change? A shift from an industrial to a digital society.

The digital society

In the early 2000s, the social theorist Manuel Castells described, in a quixotic manner, the internet as “the tapestry of our lives”. We now know he was both right and wrong. He was right that connected, digital technologies were becoming a pervasive force, premature though his pronouncement seemed at the time. But, in his fabric metaphor, he saw these technologies as a neutral platform, a means of self-identity and expression. From the vantage point of 2018, we know that digital communications technologies, overlaid with algorithmic code, are far from neutral. These technologies intersect psychology, our relationships, our politics, our knowledge and our economic life. This intersection is heavily biased. Some people, places, nations, genders, skills, viewpoints, political styles, access to capital and to networks are favoured over others. Some inequalities can be subverted as new doors open for the technologically and culturally dexterous but, overall, they are more likely to be exacerbated. The influence of digital technology is now socially pervasive.

The effects of economic forces on Janesville were not neutrally distributed; they were particular, biased and concentrated. Similarly, access to power, wealth and opportunity is heavily biased in a digital society. The benefits have been enormous, but a darker side is becoming apparent; we can, for example, see that non-neutrality means deeply destructive political, geopolitical, criminal and terrorist forces can unleash chaos. The travails of Facebook over the Cambridge Analytica affair are just the latest instance of non-neutrality. We can also observe that power and wealth can become concentrated in new ways as particular platforms and global marketplaces are able to capture and occupy magnified network effects. Mental wellbeing, a sense of agency in work and the political decisions you make are all influenced by the degree of control you have over digital platforms.

All of this may seem unduly pessimistic, but it is not intended to be. For it is by facing the risks associated with the spread of the digital society that we can better secure the rewards. New forms of work, a better environment, healthcare, new ways of interacting and cooperating and access to knowledge and new ways of collectively solving problems are just some of the many benefits. But too few may be able to partake in them unless we manage the risks as well. Social discontent may become far more prevalent. We have some historical examples for guidance.

Following the American Civil War, that society faced a transition from an agrarian to an industrial one in the late 19th century. For digital technology today, read the railroads then. As America expanded westwards, its economy became ever more shaped around commerce and industry, while agriculture declined. American cities expanded and were reshaped. Chicago — at the heart of railroad expansion — boomed and was even rebuilt following a great fire flattening over three square miles of the city. Its rebirth was celebrated in a World’s Fair in 1893 (modelled on London’s Great Exhibition, with which the RSA was intrinsically linked). But the glitz of the so-called ‘Gilded Age’ masked a society in a state of deep conflict.

Railroads were the non-neutral connective tissue that helped reshape and redistribute power in American society. Simmering tensions, around immigration, class struggles, power, corruption and riches, lay beneath a wealthy veneer. These tensions were exemplified by the ‘robber barons’: men who had deployed political and financial influence to take advantage of an enormous new single market catalysed by the transcontinental railroads. Business empires such as that built by JP Morgan were forged in this furnace. Ultimately, the politics of this dynamic but divided nation became unsustainable and spilled over.

A nasty four-year depression in the 1890s spurred a progressive reaction; first as a movement, then in the form of parties such as Teddy Roosevelt’s Progressive Party. The biggest dynamic driving this movement was a fight against political corruption and obscene wealth. Progressivism became an all-encompassing force for change, from expansion and promotion of education to improved working conditions and trust-busting. Mixing in with prevailing middle-class puritan moralism (prohibition of alcohol was one thread of progressivism) and scientism, where the professions, academia and industry were to be placed on a more elevated scientific footing, this progressivism was a creature of its time. The Fordist (or Taylorist) factory as intricate organising machine came out of this way of thinking. Nonetheless, this progressive era was a remarkably creative response to the raging inequalities and insecurities of the Gilded Age.

Railroads and big business were regulated properly for the first time and consumers protected. Some businesses were broken up in a wave of ‘trust-busting’. And a progressive income tax was introduced, while tariffs were reduced to the benefit of consumers. In his 1910 ‘new nationalism’ speech, Teddy Roosevelt laid out a case for social welfare, healthcare, inheritance taxes and greater worker rights. Some of these became elements of his (fifth) cousin Franklin’s ‘New Deal’ in the 1930s. Of course, none of this was reserved for the US. Welfare states as an answer to raging inequality were developed and extended within many European contexts and the building blocks for the modern British social contract were put in place by the Liberal government of the time.

Then, as now, disruptive technologies reshaped society and the economy. Just as now, social tensions and a state of insecurity, albeit alongside a sense of possibility, abounded. Unlike now, a coherent and significant set of ideas started to come to the fore with a political, social and intellectual movement behind it. Admittedly, the full fruits of this thinking did not ripen until a subsequent depression in the early 1930s opened the political field. This only emphasises that if we are going through a similarly disruptive change, then a greater pace is required.

The consequences of inaction

We have barely begun to seriously discuss what sort of society we want in this increasingly digital world and how can we steer towards it. A progressive vision of the digital society must combine freedom and justice, and the means by which we seek these goals changes with time. Late 19th and early 20th century progressives used different means in different contexts, but they were aiming towards similar goals. The challenge is no less involved, no less all-encompassing and requires no less imagination today.

If the premise is right and we are indeed going through a slow process of change, then to what immediate tensions will a new progressivism have to respond? Some are becoming apparent already. The politics of the moment contains both echoes of past problems and omens of new ones. In Brexit, and indeed the victory of Donald Trump, there is an echo of the old wounds of de-industrialisation. In Rock County, where Janesville is located, there was a 7% swing from Democrat to Republican between 2012 and 2016. Almost half of Trump’s winning margin in Wisconsin can be put down to that shift alone. A correlation between post-industrial Britain and support for Brexit has been established. The echo contains cultural as well economic divides, with concerns over immigration linked to rising economic insecurity.

In the UK, one signal of tension is the relative success of Jeremy Corbyn’s Labour Party in last year’s general election. His coalition is built on the under-45s and ‘held back’ — the bedrock of Labour’s new supporter base — rather than the over-65s and ‘left behind’, among whom Brexit and new Tory support is found. Faced with austerity, student debt, lack of access to affordable and suitable housing, economic insecurity, work-life imbalance, low savings and long working lives, this group have become a — perhaps surprisingly — radical force. But, for all their economic stresses, these voters are not generally motivated by the same social conservatism or cultural anxiety as the Brexit constituency. They have tended to be socially liberal and remain supportive of those principles. They are generating a new political energy that arises from the current economic and cultural strains. The viral politics of the digital society has accelerated the expression of this energy.

The characteristics of being held back are best explained in reference to a treatise of economist Albert O Hirschman, Exit, Voice and Loyalty. Hirschman’s core thesis was that in the face of institutional decay, there are two potential responses. One is ‘exit’, which is the market method. You can work, shop or devote time elsewhere. ‘Voice’ is the democratic method. You can show up and seek to influence direction. This is the world of citizens, solidarity and active participation. But what if neither good exit routes nor the opportunity to influence through voice are available? There is an irony here. Never have we had more ‘voice’ as social media platforms spread, but turning that into change appears elusive. In the workplace, as trade unions and other supports have decayed, often we have little voice at all. As the political economy of the digital society emerges, this paradox of unlimited voice but little influence may be precisely the situation for a growing number of held back, often younger, people. ‘Loyalty’ becomes the only, yet dissatisfactory, option.

The RSA’s survey of modern work, Thriving, striving or just about surviving?, identified two groups of highly insecure worker, the ‘chronically’ and ‘acutely’ precarious. Both groups were younger than average compared with the working age population. Some of these workers are on their way up but a huge number may well be ‘stuck’ in their current situation. When we see that 41% of the survey sample have accessible savings under £1,000 and 32% have less than £500, you understand how people get stuck even in work with sub-optimal income and opportunity for experience. When you add in a welfare state that is constructed on the basis of a simple equation of work — any work equalling economic security — then the stuck and held back nature of work for many becomes even clearer.

Insecurity interacts with inequalities of income and wealth and feeds into lower productivity as people get stuck and fail to have good access to new skills. This exacerbates political divides and cultural conflict. Meanwhile, a digital society is emerging where control over the algorithm, data and platform increasingly creates potential for exacerbating inequalities of wealth, income and power. The conflicts and tensions of agrarian America were not properly resolved, particularly in the aftermath of the abolition of slavery, before the disruptive force of continent-wide industrialisation and communication took hold. A similar situation is evident now. The progressive reaction from the 1890s to the 1930s (with a distant echo in the 1960s) ultimately responded to acute social tensions. From ‘muck-raking’ journalism, active chronicles of injustice in America’s cities, to visionary politicians and lawyers, radical social theorists and movements, at critical moments a progressive response became possible and then was realised. A similar task is now ahead.

A new progressive vision

Progressives today should share a sense that the current distribution of power, wealth and opportunity is not quite a square deal. But a progressive political economy cannot be silent on human purpose and meaning. Progressivism should exalt civic and economic citizenship. It is through empowered citizenship — participation — that freedom comes into view.

The digital society opens out new means of participating and new creative possibilities, but it also creates new collective challenges, such as bias in machine learning. We need to create an environment where participation, on an equal footing, in work and democratic life, and civic and social engagement is possible. This would create a broad notion of citizenship through which our collective challenges, digital or otherwise, can be confronted. We know that the human mind is moral, creative, social and complex. So diversity, creativity and solidarity should be embraced as means of maintaining a common life in a complex world.

One critical response will be to deepen and widen education and learning systems. Throughout our lives, from school to our final years, deeper access to the world of knowledge should be matched with wider engagement with the world of action and participation, the embodiment of citizenship. Passion, resilience, generosity and determination should be a part of the life-long learning picture too. This expansive culture is akin to head teacher Peter Hyman’s head, hand and heart approach to education, described in a previous edition of this journal and in the RSA’s Ideal School Exhibition, and should become a lifetime pursuit with learning systems and supports to match. This would require a significant rethink of how we enable people to access quality learning more continuously in the post-16 environment.

If the potential upside of digital society is greater scope for human freedom, diversity and creativity, then a very real downside has to be confronted. There is a harsh truth here. Freedom cannot be widely enjoyed without disparities of wealth, income and power being addressed. The fear is that already, as can be seen in debate about unequal access to opportunities in the technology sector, a model of division rather than diversity is emerging. Without access to resources — financial, and networks of opportunity, influence and voice — freedom is a hollow concept. Resources create a bedrock of security on which creativity is expressed.

This is why there is a strengthening case for a universal basic income. The RSA itself has recently suggested that a sovereign wealth fund could be established to provide up to two years of basic income-type support for working age people and their families. Such a ‘basic opportunity dividend’ could help release the held back and the stuck and open new vistas of opportunity. It essentially puts a greater array of ‘exit’ and ‘voice’ options on the table. Basic income alone is only the beginning of a new social contract. As Tony Greenham argues elsewhere in this edition (see page 36), economic democracy also relies on a wider distribution of assets, ownership and voice. As new strategic economic approaches are adopted, especially at the local or regional level, new forms of business and asset ownership should be explored. New forms of worker support and solidarity have to be a part of this voice amplification. And existing concentrations of wealth and power have to be contended with.

That is why there needs to be consideration of how common assets can be deployed in a manner that better balances public and private gain. This is ultimately where railroad-era America failed. For example, could the transfer of data from citizens to global digital platforms be levied to help fund the sovereign wealth fund we have proposed? We believe so. Moreover, new models of public influence, voice and regulation will be needed to help ensure that machine learning is grounded in public and not just private benefit.

The methods matter

The progressive movement in early 20th century America spanned interventions ranging from tax to worker support to education and new social investment and security. A new progressivism would cover a similar span. Yet, pre-determined solutions will not do; the method matters, and it must be experimental. The vision must be bold, but getting there relies on sources of civic energy within complex systems. The RSA’s methods try to ally promising ideas with experimentalism and working with others to explore implementation at scale. A new progressivism needs ambition and boldness, but interventions should test where opportunities for change actually lie: thinking systemically, acting entrepreneurially.

We know that change takes time, but we can already see the contours of the change needed and the threats we may face. Industrial society was too blind to the social and environmental impacts of its technologies. We cannot be blind to the psychological, social, environmental and political challenges of a digital society.

For those who wish for an authentic freedom, then new approaches must inevitably follow. If we fail, the risk of sudden-impact events such as Janesville become more likely. The social division of today will barely be the beginning. But if we observe and learn from past change events then a new progressivism can help us navigate through. Foresight, knowledge and imagination are, after all, necessary conditions of a modern enlightenment.