1280: Cory Doctorow | Why Everything Got Worse and What to Do About It

22:36And then that was so unwieldy that I just put a big graphics card in it and they just switched to Windows. So Apple solved this problem. And the way they solved the problem is they got software engineers to reverse engineer Microsoft Office. And they made the iWork suite, pages, numbers, and keynote, which perfectly read and write Excel, PowerPoint, and Word. And then they ran this campaign called the Switch Campaign, which was basically like, you can just switch, just buy Mac, and then open all your documents on that Mac. And it'll work just fine. And that was because digital computers have this incredible characteristic that they are, In computer science jargon, I'm a fake computer scientist.

23:12I have an honorary doctorate in computer science. So not a real one. And I dropped out of a CS program. But in computer science jargon, we call a computer a Turing-complete universal von Neumann machine, which in computer science speak means this is a computing engine that can compute every valid program. So this iPad in front of you has the same processing capability, the same instruction following capability as the processor in the digital SLR that's recording us and the smart TV that's right next to us and your smartwatch that's over there and also the Univac. Now, they run at very different speeds.

23:46They have different amounts of RAM. It might take a million years for the Univac to run your iPad apps, right? But all computers can run all programs, which means that if there's ever like a 10-foot pile of shit in a program you use, there's an 11-foot ladder made out of code that someone can give you that you can use to go straight over it, which is what Apple did. Now, in the years since, we have seen the expansion of IP law to make that kind of move a felony under Section 1201 of the Digital Millennium Copyright Act. Reverse engineering a device that is designed to resist reverse engineering is a felony punishable by a five-year prison sentence and a$500 ,000 fine.

24:23Right. So they're just throwing – that's making that wall higher with criminal laws. So it just makes it illegal. So this is another policy dimension. This is why I say the enchitogenic policy environment is what created this, right? We made it illegal to fix someone else's broken technology. And then we wonder why all our technology is broken. We have an MDNO that sponsors the show. They're called CAPE and they're security forward. And the only reason these things can exist is because the law is like, hey, if you're going to own all the cell towers, you have to let other companies rent these cell towers for a fair amount of money.

24:54Essential facility sharing. And so it's interesting to see how these places, they'll either be like cheaper than AT &T or CAPE, which is what we have is like, hey, we actually secure this. We have a value add. Right. Somebody can't go, hey, I'm Jordan. And then they go, oh, OK, you want to take the SIM card and transfer it to another phone so you can steal all of Jordan's banking information? Well, on those carrier networks, they all run a protocol called S7 that was part of the original GSM spec that is used for billing for SMS and roaming. And it's so insecure that you can, broadly speaking, get the location and movements of anyone who's got a cell phone because S7 sucks so bad.

25:29And then the carriers are riddled with insider threats. And so you have bad actors, bounty hunters, bill collectors who have been able for years to get detailed information about your location and cell phone use from the carriers. There's even commercial services where you can just go buy it and there's like a cutout. You know Bellingcat, right? Sure, of course. I interviewed someone from Bellingcat and he was saying that one of the ways they found these Russian spies who had come and basically tried to kill that spy in London. Yeah. They found them because they just have all these corrupt people working at cell phone carriers in Russia.

26:02And they were like, what if I give you a thousand bucks? Can you give us these guys locations the entire year? And they were like, OK, sure. This is one of the things about the capacity of these firms to gather and retain so much data on us, the tech firms, is that they have insider threats. They leak like civs, right? And we see this over and over again. You know, Facebook has had multiple people inside Facebook who were fired for stalking their ex-partners. I always wondered about that. So is Google and so is the NSA. In fact, the NSA has a little cute acronym for it. So, you know, there's two kinds of intelligence that spy agencies collect.

26:40The human, which is human intelligence, which is when you ask someone something. And SIGINT, which is signal intelligence, which is you spy on their communications. They have a third kind. They call it love-int, which is when you spy on someone you have a crush on using the NSA's surveillance technology. Which has got to be a million percent illegal and like a felony. But they're like, hey, stop that. Right. Well, and, you know, again, how are they going to find out? And are they really going to punish you? And so any data you collect will probably leak and any data you retain will definitely leak.

27:09How creepy, you know, you're dating, you date some guy in high school or, you know, some gal in college, whatever, you know, whoever you're dating. And you're like, oh, that's so weird. She works for the CIA now. Wait, she works for the CIA now. Or, you know, Booz Allen or IBM or one of the other major contractors or Palantir, you know, who have all of this capacity and who aren't shy about using it. Yeah. Like, hey, you know, I can find you on any camera. Cool, you can see me crossing the street in New York. Wait, you can find me on any camera? What else have you seen me doing? Right. Well, and, you know, we have these flock cameras everywhere.

27:42And, you know, we're told that it's a public safety thing. But, you know, even if you stipulate to it, which I don't, if you stipulate to the idea that law enforcement shouldn't need to obey the Fourth Amendment, should be able to track you everywhere you go. No one has ever watched a detective movie in which the detective says, oh, I got that license plate number. I'll call a friend at the department and find out who it belongs to and gone. Oh, that's incredible. That's stupid. No cop would ever tell a buddy who the license plate belongs to. We all understand that that is routine. Well, stalkers, creeps, crooks, you know, they are all able to access people who have access to all of this data.

28:19Or they are those people. We also take each other. You mentioned this in the book. We take each other hostage on social media because, I don't know, my immigrant community has a Facebook group or my parent group for my kids at school. It's on WhatsApp. So what am I going to do? Say I don't use meta products and they're like, well, good luck. You just won't know anything that we're doing. Your kid's really going to enjoy Cupcake Day. Yeah. Yeah. So there's that. I mean, there's also like maybe you've got the same rare disease as other people. Oh, yeah, sure. You know, this is called the collective action problem.

28:46It's another term out of economics like switching costs. And it just refers to the fact that as much as you love your friends, they're a giant pain in the ass. Right. And you can't even agree on like what movie you're going to see this weekend or like what bar you're going to go to. So how are you going to agree on like when it's time for all of you to leave Facebook? And Mark Zuckerberg understands this. He understands that so long as you love your friends more than you hate him, that you'll probably stick around even if he makes the service worse. So this is intrinsic to any kind of social service.

29:16It's a way to do lock-in that's much cheaper and more reliable than the more exotic forms of lock-in, like getting a bribe from Google to not make a search engine or setting up these extreme billing systems where if you want to get all the discounts and whatever, you all have to lock in and no one of you can leave. And it's like a real hostage situation. This is a very straightforward one. It just sort of occurs organically. And this is why we see social media becoming such a cesspit. Now, we were talking about MySpace. When Mark Zuckerberg was luring people off of MySpace. His pitch wasn't just that we are privacy respecting and not owned by a billionaire because that only gets you so far.

29:54Like, are you going to sit there in smug solitude rereading the privacy policy and waiting for your stupid friends to come join you on Facebook, right? He said, here's a tool. It's a bot. You give it your login and your password. It'll go to MySpace several times a day. Pretend to be you. Scrape everything waiting for you in your feed there and put it in your Facebook feed. You reply to what will push it back out to MySpace. So you can eat your cake and have it too. This is adversarial interoperability. It's just another version of what Steve Jobs did when he got his engineers to reverse engineer the office suite.

30:23And what we've done in the years since is just made that illegal. So in 2024, there were a couple of teenagers who made an app called OG app. And you gave it your Instagram login and password. It logged into Instagram as you. It grabbed everything Instagram was waiting to show you. It threw away the ads. It threw away the suggestions. It threw away the boosted content. It threw away the stuff that had been surfaced from three months ago because it looked like clickbait. And it showed you the things that the people you were following had posted in reverse chronological order and sent no data back to Meta unless you liked or commented.

30:55So normally when you're using the Instagram app, they know everything. If you slow down when you scroll, they get that. They are in the accelerometer of the device. They know how you're holding it from moment to moment. It's a crazy amount of data. They just sent none of that back to Meta. So within a day, OG app was in the top 10 of both app stores. That night, Meta sent takedown notices to Apple and Google and it was gone in the morning. And it's against the law to reverse engineer your iPhone to sideload apps that don't come from the app store. I didn't know that. So that was the end of it.

31:24I did not know that. I should probably stop publicly telling people about all the sideloading I do on various platforms. Yeah. So if you have to bypass an access control, right, if there's a countermeasure that you have to defeat, it doesn't have to be very effective. It just has to be enough that they can go to court and say there was a countermeasure. The toolmaker bypassed the countermeasure. And then that's a felony with a five year prison sentence and a five hundred thousand dollar fine. Silly me. I thought I owned this device. Yeah, I could use it how I wanted to use it as long as I wasn't hurting anyone.

31:55It's pretty abnormal that we have property that we want to use in lawful ways and the manufacturer disprefers it. And that takes precedence. So I routinely, it's funny because when I said, hey, is your book on Audible? You were like, no, dumbass. When you read it, you didn't say that. But the vibe was maybe when you read the book, you'll understand. No, it's not on Audible. And it was kind of funny. I felt like as soon as I read the book, I was like, I'm turning red now. Oh, I don't mind at all. I mean, they're 90 percent of the market. Nothing quite says changing the world like free snacks in a 90-hour work week.

32:28Quick break, then more dystopia.

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35:18Anyway, you can find the course again, all free at six minute networking.com. Now back to Corey, Dr. Rowe. It's funny because I think I admitted to another felony on the call with you, which is I go, Oh, you know what I do is I just, I use this program called open audible and then I download it and then I put it in my other app. Trafficking in that program is a felony. Yeah. I didn't know that because I felt like, Oh, I own the books. Yeah. Well, and here's the amazing thing. Say I, as the author, let Audible sell my books. Audible has a requirement that all their books be locked up this way. It's called digital rights management.

35:52DRM. So I let Audible sell my books. So they collect whatever,$15 from you. Now I wrote the book. In this case, I read the book. I also paid for the engineer and the director. I paid for the editing and the QA. It's my book, right? I own that book. So you bought the book from Audible. I give you the tool to take that book out of the Audible app and put it in like another app, I commit a felony, right? As the copyright proprietor, it is illegal for me to let you take my copyrighted work and use it as you see fit. And it's a copyright violation. And it's not just a little copyright violation. If you were to go and like pirate the audiobook from Audiobook Bay, you would face a less harsh sentence than I would for supplying you with a tool to take your purchased copy elsewhere.

36:37Yeah, that's insane. If you were to go and shoplift it at a truck stop on CD, you would face a less severe sentence than if I gave you the tool to use it as you see fit. If you were to stick a gun in the face of the truck driver who delivers the CDs, now we're getting to par in terms of your expected sentence for hijacking the truck and for me giving you the tool to take the work I created. So this isn't really copyright. It's more like felony contempt of business model, right? It's like the right to conjure new felonies into existence by adding a little bit of access control, some DRM, and then making it so that anything you want to do that the DRM prohibits requires that you go past the access control.

37:18Crazy. And since that's illegal, that's the end of the story. So is it illegal for me to use Open Audible or is it just illegal for me to share the program? Well, so it is both illegal. It is a civil matter for you to use it and it is a criminal matter for you to traffic in it. What is trafficking in it? Not mentioning it on the podcast. Giving it to someone else, telling them where to find it. I would never do that. But also, and this is very important, telling someone how it works, right? Like what vulnerability did you find in Audible in order to exploit it is also correct. Now, this is important because when you do security research, this is the gold standard for security research.

37:50You say, I investigated this thing. I investigated your smart TV and I found out that it was spying on you or that it would let other people spy on you. And here is my proof of concept code. This is how I bypass the bootloader. This is how I show that it could be done. I see. that is a crime so effective criticism of defects of a device so I'll give you a really severe example what if I say put a piece of tape over the camera on the bottom so this is where like what is circumvention what is an access control that's probably fine okay there's very little jurisprudence on what is and isn't an access control there's a very funny case where this weirdo started a Napster clone called Amster and then he put all the song titles in pig Latin I remember this he tried to get his name was Johnny Deep who's very weird he tried to get the record companies He tried to sue them for decrypting the song titles that were in Pig Latin.

38:37And the judge was like, I'm sorry, that's not an effective means of access control. But I'll give you an example of one that's really bad. So in Poland, there's a giant train manufacturer called NUVAG, N-E-W-A-G. And NUVAG, turns out, booby traps their trains. So if they sense that the locomotive has been taken to a rival's service yard, or if the locomotive is immobilized for more than a few days in a place that might have a rival's service yard, they brick the locomotive. It just stops working. That's insane. Over-the-air kill signal to it. They didn't disclose this. All that train operators knew is that their trains would sometimes stop working.

39:10And they would call up NuVog, and NuVog would say, oh, let us do some remote diagnostics. That's a 20 ,000 euro service chart because you didn't buy the service package from us. You unwisely bought the service package from our competitor. And then they would just charge them 20 ,000 euros to go in and click the make train go button again. And this got very suspicious because there was a piece of mainline track. And when they'd drawn the rectangle around the service depot, they'd been sloppy and they'd drawn it around the mainline track. So trains that went down this track would just stop. So the security research group was hired by one of the train operators and they discovered this sabotage, right, that this company had basically tied Poland to the train tracks.

39:48Article 6 of the copyright directive is just like Section 12.1 of the DMCA. The U.S. Trade Representative made all of America's trading partners adopt identical laws to our anti-circumvention law. So every country in the world has a law like this because otherwise someone in Poland could go into business disensitifying American products and make a lot of money. So you have to have everyone else agree to stop doing this. So the manufacturer is suing the researchers and an MP, a member of parliament, who talked about their work in the parliament for violating Article 6 of the copyright directive because they revealed the method by which they were able to access the firmware of the train.

40:24I mean, that's hopefully a Supreme Court of Poland type of case where they go, yeah, you can't freaking do that. Cases normally take sort of eight to 10 years to get to the European Court of Justice, which is the federal court in Europe. And we'll see how it goes. But in the meantime, look, if you're a security research firm, which is you have to understand security research firms sounds very grandiose. Yeah. It's like five dudes. Yeah. Three people were just like super into this. Right. And love the intellectual challenge and make good money, like figuring out how stuff is broken, warning people.

40:50But not like 50 million dollars to defend a European court of justice. That's right. Against a massive multibillion dollar train. Train operator. And so like, so say someone comes along to you and they say, you know, we're worried that this ventilator might have some back doors in it. Would you make sure that when we plug this ventilator in, it can't be remotely shut down by malicious actors? Can you do an audit of it before we put it in our hospital? Are you going to do that? Are you going to bypass the firmware? Especially since all the ventilators in the world are made by one company. It's called Medtronic.

41:21They're an American company, but they pretend to be Irish. They did the largest tax inversion in history. All their money floats in a state of untaxable grace somewhere over the Irish Sea. Doesn't Apple also do that? The Apple, Google. Ireland's a made town. So they pretend to be Irish. They booby trap their ventilators. And if you put a part in the ventilator, even one of their own parts in it, but you don't pay their technician to come and type an unlock code, the computer or the ventilator won't use the part. So during lockdown, you had med techs at hospitals who were harvesting working screens from dead ventilators and putting them in working ventilators with dead screens.

41:58But the screen would not work with a ventilator. Right. Because they could not get someone from Medtronic to get on a plane and come to their hospital because there were no plane flights. Right. People were just dying because of this. That's super sad. Are you going to risk their wrath if someone says audit? So Medtronic makes everything. They make deep brain stimulators for people with Parkinson's disease. They make glucose monitors, insulin pumps, implanted defibrillators and pacemakers. These are things that you do not want to have remote security vulnerabilities. And they all have wireless interfaces because you don't want to get your firmware updates with a scalpel.

42:32Right. So what does it mean if your deep brain stimulator or your implanted defibrillator can be remotely triggered by someone standing a couple of feet away from you? Right. Oh, my God. And their argument to this is we want to make sure that you're really using high quality parts because it's a deep brain stimulator. We don't want to knock off Chinese part in there that fails. Sure. You got to buy ours. There's something to that. But I don't know. They have an irreconcilable conflict of interest. Yeah. That's a good way to put it. Because, you know, yes, it's true. They sometimes want to defend your interests and sometimes they don't.

43:02So one of the things that has kept Medtronic in the news for so many years is that their devices are wildly insecure. So, for example, they had a supply chain problem where, you know, you go to the cardiologist, they put a wand on your chest to read out your implanted defibrillator and update its software. the software update that came from Medtronic onto the PC that the cardiologist had and into your implanted defibrillator, which is basically a giant battery attached to your heart, right? That software had no integrity checking. So you could just put different software in that supply chain and there would be no way to detect the tampering.

43:37So it wasn't, there was no cryptographic signatures that went with it. So this is like super basic stuff. Super basic, yeah. Like your watch gets software updates that are signed. If I were to hypothetically download a movie from BitTorrent, even my transmission on Mac program will check the integrity of the file and make sure it matches. Exactly. Right. So, yeah, no integrity checking, easy supply chain inserts. And this is just very bad. Yeah. Right. And so, like, the idea that, well, you should delegate all your trust to Medtronic because they really care about your security and take it seriously would be more valid if they did.

44:11Yeah. But also like one of the reasons that they don't have to take your security seriously is because no one's allowed to tell you when they screw it up. Right. Exactly. Like the good news is we updated your pacemaker. The bad news is we put Tetris on it. So Quake, I think. Yeah. We all install on everything. That's right. So unfortunately, you're it might work a little weird, but it's going to be pretty freaking cool. And you should show yourself. Yeah. Yeah. I want to talk about Amazon. Speaking of evil actors. I mean, Facebook, there's so much we could talk about. with Facebook, right? The metaverse that failed, how they suck in.

44:44You don't use the metaverse? Does it exist? I use the metaverse all day. I mean, this is one of my rare exits. No, I never use the metaverse. Are you kidding me? A brick on my face? No way. Have you seen Apple Vision Pro? So I have a housemate who, for some reason, can only watch the NFL on his Apple Vision Pro. Yeah. So if I come into the sitting room and he's on the couch with a brick on his face, I'm like, I guess the football's on. Yeah. I will say Apple Vision Pro is one of the coolest things I've ever used in my life. It's like the iPhone, but in terms of like how revolutionary it is, but it's too expensive.

45:15There's not enough you can do with it, but it's like my favorite toy. But the metaverse, I remember watching an interview with Mark Zuckerberg in there and it was just like, it looked like a game from the eighties, except they were kind of like, we can play ping pong. Right. No one, who would use this besides kids who play Minecraft and then they're just going to want Minecraft. I got to say, I saw that video and I thought it really had legs. Because the legs were all janky in the video, folks. So Facebook sucking in all this journalism content and it was like, hey, we're making the site more useful.

45:46And then it was you just don't have to go to that site anymore. And Google's doing the same thing with their AI summaries. They basically now you search for something in Google and it's like, hey, you were going to click on the first three links. Don't bother. Here's what they say. Right. And I find that kind of useful. But I'm also like, oh, I feel bad for the guy who makes a living off this website. Well, and if you ask Google, hey, does this say I get it wrong? They'll say, yes, but everyone should click on those first three links to make sure that the summary is correct. Well, it's not like Google doesn't have analytics.

46:17They know that no one clicks on those first three links, right? So they are giving you summaries. They know the summaries are inaccurate. And then they are adding enough window dressing around the summary that they'll blame you if you accidentally poison yourself instead of you blaming them. Here's a question that I don't understand. So a lot of websites make their money from like Google ads on. Yeah. So let's say I have a recipe website. And the first result in Google for, I don't know, Eggs Benedict or something like that. I've got a bunch of Eggs Benedict recipes as the first result. Now people search for Eggs Benedict recipe.

46:50They get an AI summary. My ads aren't firing. My business is screwed up. But isn't Google also taking a hit? Because those are Google ads. So Google's like, ah, we'll take the loss. We just want people to use the AI summary. I don't get what their angle is here. I have a book coming out in the spring called The Reverse Centaur's Guide to Life After AI that tries to answer sort of why are they so all in on what is objectively the money losingest technology in the history of the world. No one has ever lost as much money as the AI companies. Yeah. Right. I mean, ever. And they say, oh, well, we'll make it up somehow.

47:23But it's like every time you add a user, you lose more money. Every time that user uses your product, you lose more money. The only people who have not lost money on GPUs are the ones who forgot that they needed electricity for it and then couldn't find anywhere to put it, and it's sitting in a warehouse. Those people have lost the least money on their GPUs. It's crazy. So why are they spending all this money? And I think it goes back to this paradox of the firm having a 90 % market share. So if you're a growing firm, the investors value you with what's called a high price to earnings ratio. So that's the amount of money that your stock is worth relative to how much money you make.

47:58So if you make a million dollars a year and all of your stock is worth$10 million, you've got a 10 to 1 P to E ratio. Growth firms have very high P to E ratios. Famously, Tesla's is in the three figures. Mature firms have much lower ones, even if they have the same cash basis, right? Even if they're selling the same number of units, making the same profit from all of them, because the share in the growth firm is a bet on its growth. Now, the thing about having a growth stock is that it is very advantageous for growth. So if you want to hire someone or buy a company, they will often treat your stock as though it was cash, right?

48:35Because it's growing. And if you're thinking about, say, Target versus Amazon, and they both want to buy a logistics company, right? Someone who manages warehouse stuff so they can do shipping. Target's a mature company. Amazon's a growth company. They both make offers for this company, this logistics company. Target has to make an offer in dollars. and they can only get dollars from their customers or a creditor. If you make dollars at Target, the Treasury Department pays a visit and takes you away in handcuffs. Amazon can make a bid in stock. And the way that they make stock is they type zeros into a spreadsheet.

49:11They don't have to convince someone else to give them stock before they can make an offer. And so this means that a growth company always gets to keep growing because they can always buy companies, hire key personnel. Now, when Mark Zuckerberg hired that AI scientist for$100 million, he didn't give him$100 million in cash. He gave him$100 million in metastalk, which he created by typing some zeros into a spreadsheet. I see. So they can print money. Yeah. Yeah, they can print money. Now, here's the paradox. Eventually, anything that can't go on forever stops, right? And so eventually you stop growing because you've got 95 % market share and Google Classroom takes 15 years to make you a billion adult cohort who will be your customers.

49:51And so then the street wakes up and they go, oh, you haven't hit your growth target. Like we sometimes are like, why are these guys so obsessed with growth? This is why. Because if you don't hit your growth target, they're like, okay, you've got a good business, but it's a mature business. Everybody panic sell now. Which means that it's overvalued by five to one. So January 2022, Mark Zuckerberg gave an investor conference, his annual first quarter investment conference, investor conference. And he said, we experienced slightly lower than anticipated growth among US users last year. and there was a one-day$260 billion sell-off of Facebook stock, right?

50:25And who is the person in the world who loses the most money when Facebook stock goes set? Mark Zuckerberg. So this is how it happens that he, like, arises from his sarcophagus one morning and says, hearken to me, brothers and sisters, for I've had a vision. I know I told you that your future consisted of arguing with your most racist uncle using the website I generated to rate the f***ing ability of undergraduates. However, in the night, it has occurred to me that the true future consists of me transforming you and everyone you love into a legless, sexless, low polygon, heavily surveilled cartoon character so I can imprison you in a virtual world I stole from a 25-year-old satirical dystopian cyberpunk novel that I call the metaverse, right?

51:01And that's a way to signal to the market we are not just stuck growing as a social media network where we have a 95 % market share. There is an adjacent market called VR that we can grow into. So you'll remember there was one day when Google woke up and they said, actually, we're Facebook now and we have a product called Google+. I remember that. Right? And it wasn't – I mean, maybe they wanted a social media network, right? What they also wanted was for investors to say, sure, you've got a 90 % search market share, but you could grow. You could become Facebook. you could take their market share.

51:32And then Facebook woke up one day and they said, we're YouTube now. We're doing the pivot to video. And investors piled into that. We had cryptocurrency, metaverse, Web3, blockchain. I remember Facebook Pay. NFTs. Yeah. Yeah, all of these things. And now it's AI and super intelligence. And I'm not saying that they're like insincere in their belief. Like, I think that they are like, it would be awesome if people like this idea as good as that one idea I had 25 years ago that people liked. I think he believed in the metaverse for sure. I mean, it's just no one else did. I mean, if you're a billionaire, you are a solipsist.

52:03Yeah. Right. You don't really believe other people exist. Right. Of course, metaverse makes sense to you. I mean, this is why Elon Musk calls the people he doesn't like NPCs because he just thinks they're not real. You know, how can you look yourself in the mirror after a miserating people at scale if you think that they're real? Right. So you have to, you know, to a certain extent, just like disbelieve in other people, at least most other people, in order to occupy that seat. Right. And you remember these guys were all into effective altruism and long termism. Yeah. It's funny that I was just reading.

52:30about this and it was like this whole thing where it was like hey it's okay to be kind of evil now if you're donating money because in the future there's going to be a trillion people that are artificial people and if you make them all a little bit happier you will have created more net happiness than all the misery you inflict on people when you earn to give today it's almost like a religious belief like all the stuff sure yes i had my son blow himself up at a checkpoint but he's in heaven now and we're all going to heaven with him so it's all fine and those people who blew up, they're also in heaven.

53:00So what are you complaining about? Yeah. So this purchasing of indulgences, there's this kind of moral calculus. So it all has a foundation in the belief that other people aren't real. And so, you know, I think that they believed that this might work. Right. I just think that they didn't care if it worked so long as it kept the share price going. Right. So long as they could, you know, they're running across the river on the backs of alligators and they're trying not to lose a leg. Right. And so they have to make the next leap. And, you know, if they go like, OK, metaverse, maybe not, but AI. And then it's like, well, everyone who's deploying AI isn't making any money from it.

53:35But super intelligence, right? They just need the next and the next and the next and the next. That's why they keep telling us AGI's around the corner when other people are kind of like, if by corner you mean like maybe 50 years? Using a completely different technology. Shut up, scientist. I mean, this is like the idea that if you keep breeding horses to run faster and faster, eventually one of your prize mares is going to give birth to a locomotive. Yeah, exactly. It's not like humans are word-guessing programs who know more words. And therefore, if we shovel more words into the word-guessing program, they will wake up.

54:06They are profoundly different things. Now, word-guessing programs can sometimes do useful things. And I think if it wasn't for the bubble, we would call AI like a plug-in, right? Oh, I've got a thing that sometimes finds grammar errors that my spell checker couldn't spot or that can wireframe a code routine or like I'm a video editor and I can move the eyeballs of 200 extras so they're looking over here instead of over there when the director asked me to. That's just a plug-in to like Avid, right? I mean, yes, it's deep faking video, but it's just a plug-in, right? Right. And if it were like a normal technology, we'd go, oh, yeah, here's some useful things.

54:39We wouldn't be like, what if the word guessing program wakes up and turns us into paperclips? Also, it might be God. Also, everyone is fired. I want to shift from shitting on Facebook to shitting on Amazon. Sure. Amazon Prime has really changed. That has locked us in. And it's worked on me too, right? Because my buddies who run – I've got buddies who run e-commerce sites and sell clothes, some of which I'm wearing now. Kettle Mountain. We'll link it in the show notes. One of my favorite brands. Buy it directly from the website. I bought something and I said, hey – I was on a trip with him. And I go, hey, by the way, I bought a pair of pants from you three days ago and I didn't get a shipping notification.

55:11He just goes, Jordan, Jordan. Amazon has rotted your brain. we don't have slaves working for us. So it's going to take like four days for someone to go to the warehouse with all of the other orders and get it. And then they're going to ship it because we don't have slaves and robots. And you just expected that to ship overnight, didn't you? We don't injure people at three times the rate of other warehouse workers as Amazon does. It was just kind of funny. It's like, we don't ship things three hours after you order it, bro. That's kind of impossible for most companies to do. Amazon has made an exception to that.

55:42But no, if you order something off of anybody else's website and it's not sold through like a crazy 3PL third-party logistics or Amazon, you're not getting it in two days. It's just not real. And he was laughing at me because I actually expected that to happen. Yeah, yeah, yeah. Well, look, I mean, you can turn that on its head and say, well, Amazon did something quite impressive with their logistics network at a pretty high human cost, it must be said. Though I think that it's conceivable to imagine a world in which we let drivers pee and also get our things overnight. Yes, I did the show with Uba Butler who made the, have you seen this?

56:16Yes, I do. I reference it in the book. Yeah. This is a bitter lemon energy drink. That's right. Yeah. Yeah. I forget what it was actually called, but it was something where. It's called bitter lemon energy. Oh, is it? Oh, I thought it was called something like, I thought it had like a clever. No, no, no, no, no, no. Bitter lemon. That's the pee joke. Okay. Got it. Tech bosses would really like us to think that you have to take the good with the bad, that they're inseparable, that like having a conversation with your friends that Mark Zuckerberg isn't listening in on is like asking for water that's not wet.

56:44Or, you know, wanting your parcels delivered in an efficient manner without maiming warehouse workers is inconceivable. It's not possible. Right. Yeah. And, you know, this is an old trick. Margaret Thatcher, you know, when she was the Prime Minister of the UK, she used to say over and over again, so often that it became her nickname, there is no alternative. They used to call her Tina Thatcher. There is no alternative. And what she meant was stop trying to think of an alternative, right? Like stop imagining that things could be different. So you have Amazon that has done some admirable things, as has Facebook, right?

57:13Facebook was fun. Google was a great search engine. Apple made very beautiful and well-behaved devices, right? But they want you to think that there is no way you could get the benefit without enduring the costs, that those costs are intrinsic to the device. And it's nonsense. You know, I'm a science fiction writer. My job is to think of six alternatives before breakfast. So Amazon, they sold us all prime, right? They sold us goods below cost. Now, we were talking earlier about how we used to have competition law and we stopped enforcing it. A lot of competition law is about merger scrutiny, stopping companies from buying their competitors.

57:48But another big piece of it is about pricing and about what's called predatory pricing, just selling goods below cost with the intention of driving rivals out of business, which becomes a kind of money ball game where like whoever can tap the deepest pocketed investors can just hold out until everyone else is out of business and then jack up prices. So Amazon sold at these predatory prices. Prime was a big example of it. They pre-sold us shipping at a loss a year at a time. And that means that most people started their shopping journeys on Amazon because they'd already paid for shipping. And if you found it, you stayed there.

58:22Now, Amazon binds all of its sellers to something called the most favored nation deal. So most favored nation means that you have to sell at the lowest price on Amazon. You can't sell. So you said buy directly from your friend's website. If your friend is selling on Amazon, he can't sell it more cheaply on his website. He's not selling it on Amazon. Right. Because you can't say like, hey, you can get this wallet on our website for 10 bucks less. Right. You don't have to pay Amazon. Amazon will put you on page 10 million of the search results. Now, America has been through three consecutive what are called K-shaped recoveries.

58:52So that's where you have an economic collapse. And then as you have a recovery, the recovery all goes to the richest 10%. So you have these two lines. You have the recovery line. And that's how the richest 10 % are doing. And you have the 90 % going down and down. So we've had three consecutive K-shaped recoveries. Almost all the consumption capacity in our economy is gathered up in that top 10%. And in that top 10%, they all have Prime. And they all start their shopping journeys on Amazon. Almost all consumption in the American economy is that top decile. And so it's very hard to run a business where you say, okay, I'm not going to be on Amazon.

59:26So everyone's kind of stuck on Amazon. Now, if you're selling on Amazon, you have to recoup the cost of selling on Amazon. The junk fees on Amazon, when I wrote the book, were running 45 to 51 percent. The merchants are paying. That the merchants are paying. So every dollar you spend on an independent merchant on Amazon, back then it was 45 to 51 percent. Now it's 50 to 60 percent. Now, no one's got that kind of margin. So the prices go up on Amazon, but they have to go up everywhere else. Because of the most favored nation. Because of the most favored nation. So they're more expensive at Target and at Walmart and at the mom and pop shop down the block and at the factory store, because otherwise you lose Amazon, you lose all the affluent consumers.

1:00:02So everything, we're all paying the Amazon tax, even if you go, I don't use Amazon because Jordan's right, screw them, Corey's right. Well, fine, you're still paying for them. It's an economy-wide tax. I mean, this is a really good example of why shopping really hard doesn't solve monopolies. Back to the start of our talk, it's not because you shopped wrong that we got these monopolies. So I just want to break down one of these junk fees for you, to just show you how insidious this is. So Amazon has this thing they call an advertising business. It's not advertising as you understand it. If you're old enough to know about old radio scandals, you'll recognize it as what's called payola.

1:00:36That's when you pay for placement. It used to be DJs got money to play certain records. It was illegal. Amazon charges for search result placement. They have an auction. Every time you search, there's an auction to see who gets in that top box, that top row, the top couple of screens. In order to recoup the money from that auction, they have to charge more. So the top result is always either more expensive or worse or both. I noticed that. Overall pick, why is this$5 more, has 45 reviews instead of 4 ,500 reviews, and looks crappier, and it says it's made out of plastic, but the aluminum one is cheaper and has better reviews, but is like on page two.

1:01:13So on average, the first result is 29 % more expensive than the best match. The top row is 25%. You have to go 17 places down or so on the second screen to find the best match for your query. And they mix units. So you can't just say like, what are the cheapest packs of batteries? I noticed that. Because it'll be like twos instead of tens and then twenties and whatever. 17 cents a unit. Okay, is a unit one battery? Well, no, over here it's two batteries, but over here it's actually one battery. So you can't do apples and apples comparisons. So this is all designed to confound you. Now, when I wrote the book, Apple was, Amazon rather, was making north of$30 billion a year on this.

1:01:48Two years ago, the year the book came out, it was north of$50 billion. That's twice as much as all the revenue for all the newspapers in the world. So you could have two new full copies of our news media for that. Last year, it was$80 billion. Crazy. Right? And so we are now just seeing this incredible expansion. And my friend Tim Wu wrote a very good book called The Age of Extraction, where he goes into this. And he points out that this is an everybody loses proposition, right? The sellers lose because they're diverting money that they could either give you as prices or as quality. They're diverting it to this useless bidding war.

1:02:25You lose because you don't get the best product at the best price. Right, you pay more. This is a wholly useless business that is the equivalent now to three global news industries. That's just parasitism. It's just middleman extraction. Well, time to return the coffee I, I guess, rented this morning. We'll be right back. This episode is sponsored in part by Bombas. One of the goals this year and all year round is to stay comfy. And Bombas is leading that charge in my house. We love Bombas so much, it's all we wear. We even gift it to our family and our friends and our nanny. We're big fans of the grip socks so we don't slip around on our floors.

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1:05:10Homes.com knows when it comes to home shopping, it's never just about the house or the condo. It's about the homes. And what makes a home is more than just the house or property. It's the location. It's the neighborhood. If you got kids, it's also schools, nearby parks, transportation options. That's why homes.com goes above and beyond to bring home shoppers the in-depth information they need to find the right home. It's so hard not to say home every single time. and when I say in-depth information, I'm talking deep. Each listing features comprehensive information about the neighborhood complete with a video guide.

1:05:40They also have details about local schools with test scores, state rankings, student-teacher ratio. They even have an agent directory with the sales history of each agent. So when it comes to finding a home, not just a house, this is everything you need to know all in one place, homes.com. We've done your homework. If you like this episode of the show, I invite you to do what other smart and considerate listeners do, which is take a moment and support our amazing sponsors. They make this show possible. All of the deals, discount codes, and ways to support the podcast are searchable and clickable on the website at jordanharbinger.com slash deals.

1:06:11If you can't remember the name of a sponsor, you can't find a code, you're not sure it exists, email me, jordan at jordanharbinger.com. We are happy to surface codes for you. It is that important that you support those who support the show. Now for the rest of my conversation with Corey Dr. Rowe. You have to use Fulfilled by Amazon because then you won't be, you have to. or enroll in prime or you're on page 87 of search results i've also heard that amazon lets knock off usually chinese sellers run rampant on the platform so i had a buddy who made a product and he found that people in his own factory or an adjacent factory were basically making the same pattern and it was like he was making a backpack and then ubi clazar all caps right made a similar backpack but like with crappy zippers and like wasn't waterproof and crappy fabric.

1:06:58And it was interesting. It was suspiciously similar right to the backpack that happens to be five times the price. So you get this junk knockoff using stolen IP. And then he's like, hey, Amazon, they're doing this. And they were like, oh, well, and what? But Amazon does this too. So Amazon knocks off its own sellers. Yeah, Amazon Basics. Much more insidious. Look at this cable. Yeah, I mean, one of the things about using Fulfillment by Amazon is that they can see your whole supply chain. They know what factory is making your stuff because you're dropshipping it to them. They have full insight into all you do.

1:07:28Now, Congress asked Jeff Bezos, do you spy on your sellers in order to clone their products? And he said, no. And then his general counsel said, Jeff, you just perjured yourself to Congress. And he went back and said, I misspoke. So yes, we do spy on them. And clone their products. Depending on what you mean by spy. If you mean watch everything they're doing and then do the same thing, then fine, I guess we spy on them. Yeah, so this U.S. company is damaged because they invented the product and you can, basically, they can go out of business. And the only thing left is Zuby, Quesar, and the other 17 knockouts.

1:07:58The reason they have those funny names, by the way, is that Amazon does a trademark lookup just against the USPTO trademark database, the US Patent and Trademark Office database, to make sure you're not infringing a trademark before you sell. And so they just take random strings of letters that there won't be a trademark for. I see. Because I was like, why do they not just have one guy who speaks English going, that doesn't sound like a brand? Because they're not using brand names to sell. They're gaming the algorithm. them. Yeah. The other thing I noticed is they'll have a bunch of reviews and I'm like, when was this product?

1:08:27Three days ago. Wow. They're selling a lot of these. Oh, wait, these are obviously fake. And then if you sort by like most helpful or low reviews, you find the ones that look like real people are like one star. This product sucks. What the hell? Buy this other one. And then all the five star ones are like great product, really ease of use. They do a lot of stuff like they will have a product that is useful. It will rack up a lot of reviews. And then the Amazon backend, it's just got bugs in it. And so you can then take that product and you can say, well, here's a new version of it. And so maybe it's a pen.

1:08:59And you can say the new version is a USB power bank, right? And so you have all these reviews that are five-star reviews for a pen, but now you have that rank. So there are lots of ways in which Amazon fails to police it. And you talked about Uba Butler, you know, it's an amazing story because he did two things. So one was he went and gathered the urine of Amazon drivers that they hucked out the window of their vans because they don't give you a pee break, but you're not allowed to come back to the depot with any pee. So they pee in bottles and they huck it out the windows of the vans. And he listed it on Amazon as a bitter lemon energy drink as a prank.

1:09:32He wasn't going to sell it to any strangers, just got his friends to order it. But he listed it as a hand sanitizer refill so that he didn't have to do any of the food safety stuff. And Amazon very helpfully automatically moved it into the energy drinks category for him algorithmically. Right. Okay. And then he had got enough of his friends to buy it that he got a human sales call from an Amazon rep saying, we're impressed with your product and we'd like to manage your logistics and production for you. So that was one thing he did. This is episode 1235, by the way, if people want to listen to it.

1:10:02Oh, very good. Yeah. So Amazon completely missed this. But the other thing that he did was he applied for a job to work at Amazon. Yeah. And within hours, they had figured out that he was someone who was going to document their labor conditions. And so you can see that when Amazon wants to do fine-grained analytics and surveillance of their operations, they can. And so when it's like preventing union organizers from getting a job in an Amazon warehouse, they are impeccable. when it's like preventing scammers from selling you bottles of piss as energy drink. They're like, sounds like a new problem.

1:10:39Or fake reviews, which some place like Yelp will find or some other places they'll find it and they'll go, no way. Meanwhile, you don't know that this is now a consumable product. You didn't know it's not a pen. How does your AI not know that they're talking about a pen and this is a photo of not a pen? And this is a problem back to Google summaries. This is a real problem with Google summaries as well is that the people who make crummy reviews where they uprank things that have high affiliate fees over things that perform well are very good at search engine optimization. So there are a lot of legacy brands like Better Homes and Garden, Forbes, and so on that have websites with a lot of search reputation.

1:11:16And this is called search reputation abuse. So they build a shadow website that only search engines can find. You would never click to their From the Forbes website that are just stuffed with shitty reviews. Like just all they've done is they've gone and take the most expensive products that have the highest commission and made them their top products. Is this why when you Google like top iPhone cases, it's like top 20 iPhone cases for 2026 and they're all crapola. That's right. So they're just the worst ones. And so this is much worse when you get to summaries because the summary will just say the very best is the X, right?

1:11:49And so you're not even seeing the kind of surrounding context. So there's a woman called Giselle Navarro in the UK who runs a website called House Fresh where they do very meticulous air purifier reviews. And it started as a thing for people with chronic allergies. And then obviously during COVID, it became much more salient. I need that. I love, I'm like a, I like want to bring one to every hotel I go to. You should go read their reviews. They're very, very good. And what Navarro has pointed out, she's done these long deep dives into how Google ranks search results or review sites, is that the lower quality of the review, the more likely it is to be in the top results and the more likely it is to be pulled into the summary and that oftentimes the top-ranked item that comes out of the summary is one that reviewers have given bottom marks to.

1:12:32Interesting. So you're buying the most expensive, least effective air purifier on the market because you're clicking through the top result. That does not surprise me at all. I mean, a lot of those, back in the day when people made it manually, I had friends that were like, I was like, what do you do? And they're like, oh, I sell cable internet or whatever in markets and I compare Spectrum versus Cox versus whatever. And it was like they got a commission from each one. And then it was, hey, it doesn't really matter which one's better. Just choose the one where you get the highest commission. And then it became, actually, we don't need a human to do this at all.

1:13:03And now it's every product on Earth. Just slopped. You can search for an iPhone screen protector and it will do this. And there's going to be a website that's dedicated to this. And there are companies where AI just makes 100 sites a day with every new product ranked by top, whatever. And it's all affiliate crap from Amazon or somewhere else. So back to incentivization being a policy choice. So during the Biden administration, the Consumer Finance Protection Bureau finalized an order about comparison shopping for financial products. So you've doubtless gone to websites where you're like, which is the best credit card?

1:13:33Oh, yes. So funny example. Yeah. Top result of that is always the one with the highest commission. Yeah. Which is always the one that gouges the customer the most. So here's what the Consumer Finance Protection Bureau did under Biden. They said, OK, we're going to we're going to make a multi-part order. The first is we're going to ban deceptive ranking. Right. And it's just there's a broad prohibition in federal statute against unfair and deceptive methods of competition. Lying to someone about what you think is the best. Being wrong is fine. Lying is different. I have to follow these rules on this show.

1:14:03I can't say, oh, I love this brand. It's so good. They paid me$10 ,000. I'm not going to mention that. Yeah. I mean, this is a lot of people who shell shit coins got into versions of problems for this. I mean, that was under securities law, but it's the same principle. So they said, OK, you can't lie about it anymore. You have to give the best ranking you can. But also, we have investigative powers under the statute. We are going to require the banks to periodically, like every couple of weeks, give us a machine-readable schedule of fees and of interest payments and bonuses and all of those other things.

1:14:33We are going to require every bank to adopt a standard data export format, and we are going to build a government financial comparison shopping site that uses our investigative powers to extract under penalty of perjury fully accurate up-to-the-minute data. You can, with one click, export all of your financial data from your bank account. We will tell you what will pay you the most and charge you the least based on your overdraft, based on all the other things about your account. And then with that same one click, you can move all your financial data over to another service. So back to switching costs, you get all of your payees, all of your payment history, all of your account history.

1:15:12When your accountant says, oh, I need all your bank statements from the last year, you can't say, oh, well, I switched banks in July. I'm going to have to see if I can find those old statements because those all carry over. So how come I haven't heard of this? So it was all finalized and then Trump killed it. Interesting. OK. Yeah. So somebody lobbied for it. Policy. Well, the banks lobbied for the right to steal from you. To steal from you. Yeah. You know, and it is stealing from you. I mean, there's lots of ways that they've stolen from us. You know, so one of the things that the banks were doing was they had software that would do order of operations processing to maximize revenue.

1:15:42So say you had a paycheck coming in and you had a rent check going out. They would process those rent check first payments, paycheck second. So you'd bounce the check. Right. And then they get to charge you a$30 overdraft. Yeah, that's infuriating. Right. And they're sitting with both of them in their hands. Right. And they're like, I deposit the paycheck. The rent check clears. I deposit the rent check. first and then I get$30 and they would just choose to deposit the rent check first. So why do I have to rent software now? I mean, I get it sometimes like they're, hey, they're constantly improving this, but just charge me for the new version.

1:16:15If I want those improvements. Now I feel like I have to rent. I'll get an app on my phone. That's like a currency calculator. And I go, oh, cool. Three bucks per year. Just give me the thing. It's sure. I want to buy it. And so I'll I admit I'm falling prey to this, it'll be like, this is$90 for lifetime or$12 a year. And I'm like, here's my 90 bucks just so I don't have to think about this dumb thing. Sure. So, you know, back to like, why do they rip you off for the same reason your dog licks its balls because they can't. Yeah, because they can't, yeah. So, you know, if we had a policy environment where it was legal to jailbreak that app and unlock the functionality they want to sell you or to download the executable code so that you could keep using it.

1:17:00Like there would be a different equilibrium. Like they would have to sit down every morning and say like, if we do this terrible thing, what share of our users is going to be so pissed off that they go and figure out how to get around it? You know, like think about ads, right? More than half of all web users have installed an ad blocker. 51 % is the largest consumer boycott in human history. And that's because browsers are open technology. You don't have to defeat an access control to plug something into a browser. So you can just plug in an ad blocker. So it's legal to make an ad blocker for the web.

1:17:30Apps, because they have access controls, they're illegal to reverse engineer and modify, which means that no one's ever installed an ad blocker for an app because it doesn't exist because it would be a felony to make it because reverse engineering the app is illegal. So if you imagine we're having like a product planning meeting here for our website and, you know, the person running the meeting says like, all right, folks, I've done the back of the envelope math. If we make the ads 40 % more obnoxious, We're going to get like a 4 % increase in top line ad revenue. That's our KPI. Let's do it, right?

1:18:00Well, someone puts their hand up and says like, I love how you think, Elon. But has it occurred to you that if you make the website 40 % shittier, that like 80 % of our users are going to go to the search engine and type, how do I block ads? And then we get nothing from them ever again, because no one's ever gone back to the search engine and typed, how do I start seeing ads again? Whereas if it's apps, you move on to the next agenda item. Well, now I'm thinking about the apps, how obnoxious are we going to make the ads? And that person puts their hands up and says, make them 150 % more obnoxious.

1:18:29Let's max out the revenue. It doesn't matter if someone types, how do I block ads? Because the answer is, it'd be a felony to do so. Right, you can't, yeah. So an app is just a website skinned in the right kind of IP to make it a felony to defend your privacy while you use it, right? And that's why every company is so horny to get you to use their app and not their website, because the website you're in control of and the app they're in control of. I guess I just don't understand how Adobe can do something like, oh, you used Pantone 227 in that logo from six years ago. If you want to display that, you need our Pantone pack.

1:19:00It's$16. It was$21. $21 a month. Yeah, per month. Yeah, exactly. So Pantone, for people who aren't in print design, you know, if you've got an inkjet printer, you know it's got like four little buckets of ink. And you mix those to make most of the colors that can be seen by the human eye. But there are a bunch of colors you can't see. your bright orange phone case over there. That's not a CMYK color that you can mix those four colors. It's what's called a spot color or a Pantone color. And you know when you go to the paint store, they have this big thing of paint chips, and you figure out which paint you want, and they mix it up for you.

1:19:31It's the same if you go to a print designer. They have a big book of Pantone swatches, and you go through it, and you're like, I want that safety orange, or I want this metallic green, or whatever. And they then, to their printer, they say, add a fifth nozzle to your print process and fill it with this special ink. So that's called spot color, Pantone color, ubiquitous in print design. And Pantone is a company. They own the copyright to these swatches and the number to chemical formula, you know, equivalences and so on. These are all things that they license. And one day, Adobe and Pantone had a disagreement.

1:20:04No one knows what happened because they didn't tell us anything about it. All that we knew is that one day Adobe said, hey, you know how you don't buy Photoshop anymore? You just use it in the cloud. Well, we're not paying the Pantone license fee on your behalf anymore. It's$21 a month. You're going to have to give to Pantone. And if you don't, whenever we show you your own documents, your whole portfolio, going back to Photoshop 1.0, all the Pantone colors are going to be black. We're going to steal the color out of your document. Your existing work that you already paid to create with the same software.

1:20:34So there's a couple of possibilities, right? One is that Pantone went to Adobe and said we would like whatever,$12 a user per year or whatever. And Adobe said, I'm just going to see if the users will pay that. That sounds good to us. Or maybe Pantone went to Adobe and said, we want$100 per user, or we're going to make you take it out of the app, right? Maybe they were the bad guys. Who knows? But here's the thing. When you create the capability to reach into your users' documents and take the colors out of them, you have to anticipate the possibility that someone will show up and demand that you do it, right?

1:21:06No one can demand that you take the colors out of your users' documents if you are not technically capable of doing it. Yeah, right. Amazon's done this. they periodically will reach into people's Kindles and delete their books because there's a licensing dispute. It's crazy to me. I'm a recovering bookseller. I sold books in a lot of different bookstores. No matter what kind of licensing dispute occurred, no one could make me go to my customers' homes, burgle them and take their books. Yeah. Or they come to the store and they go, hey, do you have George Orwell's 1984? And you're like, yeah, it's right over there.

1:21:33And they're like, all right, bring the box in. We're taking all these. That's right. I bought those. Well, not really. So once you have this technical capability, someone's going to use it. You know, this is, as Pavel Chekhov said, you know, a phaser on the bridge in Act 1 is going to go off by Act 3, right? This is just like the fully anticipatable and anticipated outcome of designing a device or service this way. Yeah, it's the same with cars, right? Like, there was a big news story where you had to pay BMW to use the heated seats that you already bought. So they walked away from that, but they brought it back in.

1:22:06You now have to pay BMW to use the automatic light dipping software that dips your high beams if there's oncoming traffic. Mercedes does this. Just a safety feature. Just a safety feature. Mercedes does it with your accelerator. So you can only use half your engine's acceleration curve unless you pay a monthly subscription. Tesla does it with batteries. Right, they do it with batteries, yeah. So battery's fully charged, but once it's at the 50 % mark, your car stops rolling unless you're paying a monthly subscription, right? It's your battery in your car. And in a normal world, remember when we said this is not normal for people to be able to decide how you use your property?

1:22:39In a normal world, I would look at what Elon Musk was doing and I would say, I can sell every one of his customers a product that unlocks the whole battery. Right. This is what Jeff Bezos did. When Jeff Bezos started the business, he went infamously to this publisher's conference and he said, what you need to realize is that your margin is my opportunity. So when he does it to us, that's progress. If we do it back to him, that's piracy. Right, right. It's piracy. Yeah. What's crazy is you can't transfer these things. Like, let's say that I bought that feature of the self, the heated seats, which they walk back.

1:23:10Who cares? Whatever. They tried it. Now it's the high beam. High beam thing. Fine. So I sell you my BMW and I'm like, don't worry. I got that high beam thing. I got self-driving. You're like, oh, cool. Thanks. And then when you turn it on, you're like, it's not working. Sure. And they go, oh, well, we saw that you sold your car to Corey. Corey has to transfer title. That's right. Well, wait, but I sold him the car. Yeah, but you didn't sell him the licensing thing that you were paid. If you get a custom paint job and a cool steering wheel cover and you get spoilers and an air dam and those purple lights under your car.

1:23:36Yes. When you sell your car, you get to charge more for the car, in theory, if you can find the right buyer. Sure. For all of that stuff. Yeah. But I can't sell you the heated seats. Sure. I rented them from BMW, even though they told me I bought it. It's really kind of the end of private property. Yeah. It's crazy to me. Because if you own something, it's yours. And no one else can tell you how to use it. And the only people who can really say that they have that relationship to their property aren't really people. They're, you know, immortal transhuman colony organisms we call limited liability companies.

1:24:05They have what the property theorist Blackwell wrote in the 18th century about property. They have sole and despotic dominion over their things. That's what he defined as property. That which man enjoys sole and despotic dominion over to the exclusion of every other person in the universe. Right. They have sole and despotic dominion over their property. You have a kind of shared title. You're kind of a tenant, and they're kind of your landlord. And just like you can't decide what color to paint your walls in your rental, you can't decide how to use your e-books, even though you think you paid for them.

1:24:37I hate this. Uber offers a different rate for drivers who behave differently. I kind of want to just tell drivers listening how to hack this, because I know people are listening and they drive for Uber or Lyft. Yeah, well, if you're interested in this, the person to follow is the rideshare guy. I know, he listens to the show. They've done well. Hello, nice to talk to you, Sergio. But they do great work. This is something that the legal scholar Vina Duval calls algorithmic wage discrimination. And it's a form of surveillance pricing. Do you remember Delta announced a little while ago that they had done a partnership with this Israeli company and they were going to use surveillance data about you to figure out how much you were willing to pay for a plane ticket?

1:25:12And they'd charge you more if they thought you were willing to pay more. So they already do what's called second-order price discrimination, or first-order price discrimination, rather, which is where if you don't stay on a Saturday, they charge you more because they figure you're a business traveler. But this is second-order price discrimination where it's like, you personally, I know that you have a funeral to get to or that you've got a meeting on Monday. And so they can change the prices. Now, a wage is a price. So it's one of the prices that gets manipulated through algorithmic wage discrimination.

1:25:40So Uber, if you're a driver, Uber can impute a level of desperation to you by how many lowball offers you're willing to accept. The more shitty rides you take, the lower the wage you're offered at every juncture. Because they're like, this guy needs money. This guy needs the money. And Uber drivers, they bucket themselves into two groups. They call themselves either pickers or ants. So pickers are people who are picky. Ants pick every ride that comes along. And in Doobel's work, she does some anthropological work. She talks to a lot of drivers and she finds that they are not just broke and not just exhausted because they're driving 18 hours a day.

1:26:18She talks to a guy who drives into San Francisco from somewhere outside of the city and spends three days sleeping in his car to try and make enough money to pay his rent. And he's looking at all these other drivers who are doing really well, who are like on the Discord or on the Reddit forum or in some other message board. He's like, I'm bad at Uber. Why am I so bad at Uber? What have I done wrong? What he doesn't realize is because he is being as indiscriminate as he can be to take out all the rights to make as much money as he can. And that's their cue to charge him less. algorithmic wage discrimination.

1:26:50To pay him less, yeah. To pay him less, rather. Algorithmic wage discrimination is happening in every category where you use an app to hire a worker and you pretend that that worker isn't an employee, but rather an independent business. And so nurses, for example, in this country, we preferentially hire nurses at hospitals as contractors because you can do union avoidance that way. And it used to be that you'd have local staffing agencies, two or three in every city. Now there's four giant apps. They all sell themselves as Uber for nursing. We have, because we've allowed corporate concentration, we have what's called regulatory capture.

1:27:24Our government doesn't update laws that would be disfavorable to corporations, or they get rid of laws that are disfavorable for corporations like comparison shopping for banking. So Ronald Reagan was the last president to give us a new consumer privacy law. It was in 1988 when he made it illegal for video store clerks to disclose your VHS rentals. That's crazy. Everything else is fair game. And so a data broker will sell anyone any fact about anyone. And so the app, before it gives the nurse a shift, finds out how much credit card debt they're carrying. And the more credit card debt they're carrying, the lower the wage the nurse is offered.

1:27:58That's insane. Holy smokes. Think about this the next time you're getting your catheter inserted, right? So this nurse might have been driving Uber till midnight the night before and skip breakfast to make rent because they are paying a desperation premium. So this is across the economy. And you can see how it's this combination of a lack of competition that leads to regulatory capture that then takes advantage of the fact that apps are opaque. Like, you know, my friend Tim Wu, I mentioned before, wrote this book, The Age of Extraction. He points out that in the age of the market, where you actually physically went to the market, although there wasn't a single price, everyone was haggling, there was social surveillance of the price.

1:28:35Like, everyone could see what price everyone else was getting. Right. The prices are now set in this kind of silo that you and the firm are locked inside of. They know all the prices. You only know one price, the price you paid or the price you were offered for your labor. So you have this combination of all these en-shitogenic characteristics. And the fact that you can't jailbreak your app means that you can't share the pricing offer with everyone else. It means that you can't make a kind of meta app, not meta like the company, meta like the concept, that all the nurses agree we're all going to turn down all lowball offers and force them to bid up the wage.

1:29:08It is like this environment in which bad people are doing bad things, but because policymakers who work for us let them. Thank you for coming on the show and being part of the En-shitification of podcasting. I appreciate that. Oh, well, thank you. And I should say, I work for a nonprofit called the Electronic Frontier Foundation. We have been fighting against this stuff for 35 years. This is my 25th year with them. We're at EFF.org. And if you want to find out how you can get involved, you can go to EFF.org and get involved in fighting and shitification in your life. Thank you. Yeah, nice talking to you.

1:29:39you're about to hear a preview from joe loya a man who robbed 30 banks across california but says the real crime scene was his childhood where his pentecostal preacher father beat him over a hundred times before he turned 15 for 14 months i robbed 30 banks sometimes several in one day i lost all sense that my life was going to be long at all i just wanted to grab the loot and get the hell out of Dodge as fast as possible and go spend it and have fun. That was my ethos. And so I did. Because all the crimes I did and all the violence I did. And starting with my dad, when my mother died, we had received a lot of love from her and everything like that.

1:30:16It's just too much for him. And when he gets angry now, he gets brutal. Like, he may have socked me. He may have choked me. He may have done all those things. Bebe with a bat. He wants us dead. He's using the dead language. He could kill us or I could kill myself, but this is like, it's just a tough time for me to try and process the grief myself and beyond being brutalized. I don't believe I have a future. So there's nothing inside of me like, oh, I got to protect my future. I better get a job. I better start saving money for the future. None of that. Because the trauma is so intense, you're only looking at surviving the next day in front of you.

1:30:52You know, in fact, I'm not made for society. They have all these moralities, but they're too timid for me. I've seen past the curtain. Like I become in my heart, like a little sociopath looking at like, you guys are falling for the okie doke. And I'm not the guy who falls for the okie doke. I'm the guy who stabs the okie doke and says, get the hell out of my way. I'm not buying it, right? Once upon a time, Joe Loya couldn't handle his emotional shit. And so now I'm a criminal. I'm a bad guy. In this episode, Joe unpacks the unsettling rapture he felt in the middle of a robbery and the exact moment seven years in solitary forced him to confront what he'd been running from his whole life.

1:31:30And the turning point that finally redirected everything? It's not what you'd expect. Check out episodes 1264 and 1265 of The Jordan Harbinger Show. So if all this feels dystopian, that's because it kind of is. When companies lock us in, extract value, degrade the product, and then basically dare us to leave, that is not innovation. that is just monopoly behavior with a better PR team. Corey makes the case that the fix isn't one magic solution. It's competition, interoperability, some regulation, but, you know, not the kind written by the same companies that's supposed to restrain, and maybe a little worker power, even if that word makes some people, myself included sometimes, kind of itchy.

1:32:10Because when your car charges you monthly for heated seats, your books can disappear remotely, and your phone decides which businesses are allowed to exist, the market is no longer doing what it's supposed to do. Thanks to Corey for coming on the show and for helping us understand the slow, methodical, profit-optimized, and shittification of everything. All things Corey will be in the show notes on the website. Advertisers, deals, discount codes, and ways to support the show, all at jordanharbinger.com slash deals. Please consider supporting those who support the show. Also, our newsletter. I love writing this.

1:32:39You love reading it. This thing has been a huge sleeper hit. I'm so glad that I'm doing it, and I wish I did it earlier. The idea is to give you something specific and practical that'll have an immediate impact on your life. Decision Psychology Relationships. It's a two-minute read every Wednesday. If you haven't signed up yet, come check it out and join us. It's a great companion to the show. JordanHarbinger.com slash news is where you can find it. Don't forget about 6-Minute Networking as well at 6MinuteNetworking.com. I'm at JordanHarbinger on Twitter and Instagram. You can also connect with me on LinkedIn.

1:33:08I'm happy to ignore you on any platform. No, I love talking with you guys. In fact, many of you are surprised when I reply, but I enjoy it. You guys are fun. This show is created in association with Podcast One. My team is Jen Harbinger, Jace Sanderson, Robert Fogerty, Tata Sidlowskis, Ian Baird, and Gabriel Mizrahi. Remember, we rise by lifting others. The fee for the show is you share it with friends when you find something useful or interesting. In fact, the greatest compliment you can give us is to share the show with those you care about. So if you know somebody who's interested in tech or everything that's wrong with tech, like Cory Doctorow, definitely share this episode with them.

1:33:40In the meantime, I hope you apply what you hear on the show so you can live what you learn. And we'll see you next time. .