TEC Review 2: The Wizard of Pretoria

Amidst Elon Musk’s several notorious performances since the inauguration of the new president of the USA, recent reports of Musk’s relationship with European news platforms has received less attention than they perhaps otherwise could.

It has been reported that representatives of Elon Musk have met with social media companies in Europe including ‘Welcome to Favelas’ in Italy, discussing potential collaborations and support. ‘Welcome to Favelas’ has been accused of being a social media platform that spreads disinformation and Musk’s links has been met with criticism by mainstream media platforms. One of the key questions is why someone like Musk is interested in this kind of connection and why audiences are interested in the kind of information they are spreading?

Recent works have debated what kind of politico-economic system they are bringing forth, or represent. The Technofeudalism school of thought has suggested that people like Musk and Jeff Bezos have brought forth a system in which oligarchs are sustained by acting like feudal lords extracting forms of cloud rent, rather than market participants relying on the production of goods and services. This post-marxist interpretation has been challenged on the grounds that there is little to make techno-feudalists distinct from the capitalist oligopolists of old. The recent vulnerability of services like Open AI has been advanced as an argument to show how competition quickly renders the power of certain parts of tech owners’ empires vulnerable to classic market logics.

In the light of the recent controversies including Jeff Bezos and his newspaper's refusals to endorse a president candidate, the relationship between LLMS and online news generation, and Elon Musk's explicit and implicit attempts to influence news generation, this post explores the relationship between media accountability and democracy and the role that new forms of technology play in it.

Information and Deterritorialisation

An important factor that has tended to be underplayed in all accounts of the rise of tech oligarchs like Musk is their relationship to the territory over which they have influence. Despite being euphemistically referred to as digital public squares or digital marketplaces, unlike public squares or marketplaces they have no immediate physical presence. The haptic qualities for an Amazon consumer is completely different to that of the local or supermarket. Participants on X/twitter are usually far removed from the specificity of any square; if they are specific, they assume their audience is not.

Of course, this does not mean that tech oligarchs operate without a physical presence. As has been pointed out by a range of scholars, the servers on which the digital world released are extremely physical, using as they do enormous amounts of land, energy and resources (Mackenzie, etc).

The important difference between the ambitions of Musk, Bezos, etc and the older means of consumption and production which they are replacing is their ability to at once be extremely physically dependent and at the same time appear to be without physical anchors or accountabilities.

In his 1900 book The Wonderful Wizard of Oz, L Frank Baum, showed the kinds of control that could be wielded by a person appearing to be something more-than-human. As most people know, when Dorothy and her gang attempt to meet the wizard all together, he is revealed to be nothing more than a magician and a conman who had been able to adopt a range of identities - giant head, ball of fire - to make people believe he was more powerful than he was.

In this 20th century tale, the wizard’s ability to act over territory was predicated on his true human nature not being exposed. In the 21st century, the substantial power currently wielded by tech entrepreneurs like Musk can be traced to a combination of factors. As Cory Doctorow notes in a 2021 interview, the political and economic environment of the 21st century has proven to be fertile ground for oligarchs. Two key factors have enabled the rise of tech billionaires: access to capital markets enlarged by quantitative easing and expansive intellectual property (IP) laws that stifle competition.

Quantitative easing, implemented in response to the 2008 financial crisis and then as a response to COVID-19, flooded private markets with cheap public capital. This influx of money disproportionately benefited tech companies, which were able to attract massive investments despite often being unprofitable. At the same time, expansive IP laws have allowed tech giants to monopolise innovations and suppress competitors. The result is a concentration of power in the hands of a few individuals who control not only vast economic resources but also the platforms that shape public discourse.

Local News

One of the most significant but under-appreciated factors has been the extensive changes in the ownership and quality of local news and the power of local/regional territories throughout much of Europe and North America. Since the 1980s, local news outlets have undergone monumental destruction, a trend exacerbated by the policies of figures like Margaret Thatcher. Thatcher’s government undermined the authority of local governments while simultaneously promoting centralisation. This process was accompanied by the centralisation and banalisation of news gathering and communication, with information barons like Rupert Murdoch and Silvio Berlusconi filling the vacuum left by the elimination of local news and local governments.

Murdoch’s News Corporation, for example, has acquired numerous local newspapers, transforming them into vehicles for web-scraped journalism and advertising. This consolidation of media power has had profound implications for democracy. Local news outlets, once vital sources of community information and accountability, have been replaced by homogenised content produced by mega-conglomerates. Local newspapers and their accompanying websites have very little real journalism or quality investigations. Instead being funded by advertisement space and underpaid copy-editors. The result is a media landscape dominated by a few powerful players, with little room for independent voices. It is not surprising, in this context, that audiences can switch to other forms of over-advertised and low quality information spaces like ‘Welcome to Favelas’.

Rival technologies do pose a challenge to the Murdoch-Berlusconi-Musk-Bezos model. Local and national radio in many places still command large audiences and attention. It is not for nothing, however, that tech barons have a keen interest in controlling the booming podcast market. Information power without territorial responsibility is the ultimate prize.

As such, the question of why Musk, Bezos etc are keen to make themselves visible at the centre of government should not be surprising. They are placing themselves firmly in the palace. What they are enacting and assuming is an intensification of the centralisation of power and the related decline of quality local news and local political accountability. As such, regardless of whether they are techno-feudal or techno-capitalist, what we can say firmly is they operate in a way to reduce/eliminate political accountability.