Tyler Cowen 11-8-2018

So today we're fortunate to have an economist and best-selling author, Tyler Cowen, to talk on "Is Big Tech Evil? What Do the Economics Tell Us?" Tyler's an economics professor at George Mason University where he holds the Herbert C. Harris Chair in Economics Department. He's the author of many books and books our reading groups have read this semester, actually. But one of them is a principles of economics textbook called Modern Principles of Economics. And if you've had my online course, you've had that book. Um, so some of you probably have used that in the past. His other books include The Great Stagnation, The Average Is Over, The Complacent Class, and a newly released book called Stubborn Attachments. And we have several copies outside of the auditorium here that Tyler will sign for you after his talk. And the price is free. So first come, first served for students, okay? He blogs on Marginal Revolution, which is with his textbook co-author Alex Tabarrok. He has lots of great insights on there. They're really, really worth looking at, looking into. And they also have Marginal Revolution University where they have lots of videos if you need help on your economics courses. You should watch those videos. It really enlightens you. He writes the Economic Scene column in the New York Times. And since July 2016, he's been a regular opinion columnist at Bloomberg View. He also writes for the New Republic, Wall Street Journal, Forbes, Newsweek, and the Wilson Quarterly. He serves as general director of George Mason's Mercatus Center, which is a university research center that focuses on the market economy. He was ranked 72 among the top 100 global thinkers in 2011 by Foreign Policy magazine for finding markets in everything. And in 2011, a poll of experts by The Economist, he was included in top 36 nominations for which economist, which economists are most influential over the past decade. So it's my pleasure to introduce Tyler Cowen. Tyler, thank you for being here.

Thank you all for having me. It's an honor to be here. The topic of today is technology and also the future. I'm mostly optimistic about the future. I'm mostly optimistic about technology. And for the most part, with some exceptions, I consider myself a defender of what is sometimes called Big Tech. The major technology companies: Amazon, Google, Facebook, and so on. What I've seen in the last 3 to 4 years is striking. 4 years ago, in the media, Big Tech could do no wrong. They were cool people who lived in a great part of the country, who gave us things for free, and they were heroes to be lionized in movies and television shows. Today, I think there is probably no company, no set of companies that are covered more critically in media than the major technology companies. Even relatively conservative newspapers such as the Financial Times, if you read their coverage of tech, I see, say, on the op-ed page, the ratio of negative to positive is probably 10 to 1. So that's a big change. I'm going to consider why that happened. But let me just give you some of the basics for why I'm positive on the major technology companies. The view we had basically 4 years ago is correct. They give us wonderful things for free. Wikipedia would be another example. That's a not-for-profit. Amazon doesn't give you very much for free, unless you like reading the book reviews, as I do. But Amazon sells you many items at much lower prices, and for the most part you get better delivery terms if you simply sign up for Amazon Prime. Now, when Amazon started, people had the notion, say in books, "Well, they're gonna sell a lot of books, they're gonna sell them very cheaply, and then someday they'll be a monopoly and they're gonna raise the price." So right now, if I go to Barnes Noble and I see a book that's like $27.95, it's like expensive, right? Like $27.95! You're getting a book out here for free. Why buy some other person's book for $27.95? And then you go on Amazon, typically the exact same book will be $17. So it's not just a little cheaper, it's a lot cheaper. And if you're Amazon Prime, the shipping will be free. So that's pretty amazing. And what people have realized over time is it's not the goal of Amazon to say put out of business all the booksellers and then raise that price from $17, say, to $40. Amazon and a lot of the other tech companies, they have a new business model and it's called being a platform. So Amazon's goal is to sell books and many other things at low prices basically forever make up the lower price on scale, data, better logistics, better computing, and just being a better company. That Amazon knows more about you because you buy so many things at Amazon. And now Amazon is even Whole Foods. You must have Whole Foods in Louisville, right? You know, Alex Tabarrok, my co-blogger, and I, we sometimes joke like we spend all our money now at Amazon because we buy our books from them and then we buy our food from Whole Foods and our homes are paid off. So, it's weird and people get creeped out by this. I'll come back to that. I do think there are some concerns. But basically, we've entered a new stage of the economy where some of the things we do They're either free or they're much cheaper. And there's really no plan that someday, like Facebook or Google— like, Google's not going to charge you 50 cents per search, you know, 5 years from now after they put the other search engines out of business. It's not the business model. Business model for Google is give away some free stuff forever and then sell ads to companies and make their money that way. And the bigger Google gets, the more likely the main product actually is to stay free. One thing that's surprising with most of the major tech companies is how innovative they have been. So when these tech companies got started, Google got started, I thought, "Well, you know, that's wonderful, but they're a one-trick pony." They did this one thing, you know, search. And what I found over time is Google has actually been behind a lot of other innovations. So, if you think of something like YouTube, which is owned by Google. I know ages in the room vary, but many of you are quite young. There was a time not that long ago when simply clicking on a video was fairly difficult on the internet. Sometimes you download them overnight so you could listen without interruption. There'd be a buffering, they would pause, whatever, it was a pain. Uh, Google bought YouTube, put more money into YouTube, Now, listening to videos, the quality of that is much higher. Google also has been a pioneer behind driverless cars. So a lot of Google employees right now, they don't drive to work. They take a driverless car to work. And, you know, they can read a book or something while the driverless car takes them to work. Within 20 years, I strongly believe a large share of America will use driverless vehicles. And instead of now having, say, 40,000 people die a year in car accidents, that number won't go to zero, but I think it will go down, say, to 10,000 deaths, injuries. Over time, driverless cars will be much safer. Google's not the only party behind that, but they put a lot of their money into the software, uh, did a great job. So, uh, If you look, say, at Google, it's remarkable how much talent they have hired with the money they spent, basically, which they earned from the ads. And they earned money from the ads because all of you went there to use the main product for free. It's a really good deal for users, or you can call them consumers. Facebook, I think, is in some ways less innovative. They're more likely to buy up other people's innovations. And bring them inside of Facebook. So probably you all know that Instagram is a part of Facebook. It was not always that way. Facebook owning Instagram is why the Instagram page has remained so pure. So if you go to the Facebook page, which by the way I don't like, I am not personally a big user of Facebook. To me it's messy and complicated, and I like wake up in the morning and there's some kind of like floating message or email. It's like, you have 37 likes, you know, 42 nudges, 17 like friend requests, and 3 or 4 other things, like none of which I actually want. It's not streamlined enough for me, so I avoid Facebook, though I have an account. But you go to Instagram page, it's like lovely, super clean. If you go to WhatsApp, which is also owned by Facebook, It's a better functioning system than email. I think it's better than texting. So if you have friends where you text or email them, consider using WhatsApp. I think it's the best system out there. And Facebook also upgraded that. Because Facebook makes money through, again, selling ads, that has helped keep clean the pages of WhatsApp and Instagram. But I think, you know, the major tech companies, I guess I'm, most enthusiastic about Google and Amazon. And again, the ongoing innovation with Amazon, just that they can deliver virtually anywhere in this country within 2 days. They have advanced logistics. This has helped American retail more generally. If you just look at different countries in the world, American retail is clearly the most productive of any retail sector. Amazon has helped that. What's called cloud computing, Amazon is the number one leader. So you have this company, they just start by selling books. Like early Amazon was a kind of joke. You can still online see their early webpage. It's like ugly, it's stupid. Most of these companies early on were ugly and stupid. But, you know, they hired good talent and they blossomed. So the notion that cloud computing works well in part because Amazon is investing in it, is a benefit from Amazon. Apple, of course, originally did the PC, then it did the iPhone, which changed the world, then it did the iPad, which I think is better than the iPhone, but no one agrees with me. Now there's Apple Watch, which I don't want, but some people really like. It's like a healthcare innovation. I think at some point Apple Watch will be good enough. It'll just like send you a text. You'd better go to the doctor, or you're going to have a heart attack next week. And, you know, if you have a heart attack in the hospital, your chance of surviving is like 98%. If you have a heart attack at home, your chance of surviving is like 50%. So, again, tech is having all kinds of benefits we hadn't thought of. A striking thing about tech, and no one in the 1990s saw this, but tech actually makes it more worthwhile to meet people. This is maybe the biggest contribution of tech. So in like the old days before technologies we know now, just for context, I'm 56 years old. I was born in 1962. So for me, the world of the web, the internet, it basically starts in the early '90s. So by the time I'm 30 years old, I've lived 30 years with none of this in my life whatsoever. I'm in a sense the last generation that can say that. I'm the last generation to have straddled the world of non-tech and tech. Puts me in a funny position, I think. But it used to be you'd like go places, you drive places, and you'd meet wonderful amazing people. And then you wouldn't see them again for 3 years. If ever, right? It would just like off, and maybe you'd like write a letter and you'd take out your pen or your typewriter and you'd mail it. But like, I mean, some people did that, but no one really did that that much, right? Maybe if you were in love, you'd write these letters. I'd write letters to my family from trips, but you wouldn't just write people letters because you met them for the most part. Maybe that was 19th century But now you meet people, you can follow them on Twitter, connect on Facebook, connect on LinkedIn, email them, text them, WhatsApp them, many, many other things. So those connections are worth much more. So tech has helped augment this human side of life. And it's striking how much we see this in Rentsch. This is actually one of the problems of of tech also, I would say. But since we've had tech, like living in Manhattan, living in the Bay Area, it's gotten way more expensive. It's crazy expensive. I think you're actually probably happier to live here. But it's that expensive because in those cities, they're so wonderful for meeting people. And meeting people has risen in value. It's one of the big changes of the last 15, 20 years that is hardly ever remarked upon. But the quality of your network, and I mean people you have met face to face, has never been higher. It's one of the biggest shifts in American life, mostly a good thing. So those are some of the positive features of tech. Uh, let me talk about some of the negative features or some of the arguments claims against tech and try to assess those. So one claim simply is these big tech companies, like, they're monopolies. So if you want to search, like, we even have the word Google. It's become a verb, right? It started as a noun. Now it's a verb. Most people, when they Google things, where do you Google things from? From Google. Like, do you ever use Bing to get to Google? Like you could go to Bing and then Google to Google, or you'd be Binging to Google. Not— people use Google. It's a dominant product. Hardly anyone denies it's dominant because it's better, but still people get nervous because it's dominant. So that's an issue. But unlike old-style monopolies, like say Standard Oil, it's not charging consumers high prices. So the price you pay is giving up some of your data to this monopoly. And I'll get back to that. Uh, but I would just say most of the monopolies of tech I don't think are very monopolistic. So if you look at Amazon, it's— the main area where it has market power is books. Amazon's a big share of the book market. Uh, but Amazon still is keeping book prices low. In most areas, most of the things people people buy, it's still face-to-face retail. So Amazon is a big share of online retail, but in any particular market, like, do I want to buy shoes, do I want to buy a raincoat, do I want to buy bug spray, Amazon typically is not above 10% in any of those individual markets. So it sort of looks like a monopoly because it's so big and wealthy, and Jeff Bezos is the world's wealthiest man, and Amazon is going going to come right near me in Northern Virginia very soon. I have mixed feelings about that. Traffic will be worse. I'll be cursing Amazon. I don't blame them for that, but still. But Amazon is actually not nearly as much a monopolist as it looks. I think the biggest monopolist actually probably is YouTube. So if Google didn't exist. Like I go to China pretty often and in China Google is banned. So it's a kind of thought experiment. You cannot without doing some complicated workarounds use Google in China. So I know what life is like without Google every year. Again, I prefer Google but I use Bing, I use other search engines. It's actually fine. I do think Google is better but that's a contestable market. So if Google did something you hated, you know, would you have alternatives? Absolutely. Other companies would replace it. YouTube, I think, is more complicated because people have loaded videos onto the system. And for those videos to kind of switch off onto another system, it certainly could be done. A lot of videos, say, switched from MySpace, if you remember that, to then Facebook. And YouTube. But I think there's a stickiness there, say you don't see with Google. So some market power for YouTube. Facebook, major social network, but you know, people at Facebook, they feel that's very vulnerable. Facebook competes with just texting people. It competes with emailing them. It competes with calling them on the phone. It competes with, believe it or not, you know, knocking on their door and going to see them. It competes with LinkedIn, it competes with blogs, it competes with Twitter. Facebook has a pretty big dominant position, but again, it's a zero price. There's a lot of competition at the fringes. There's some lock-in, like you have photos on Facebook, but what we see over time is people invest in multiple social networks for different purposes, and if they don't like one of them, they kind of bleed out on the edges. And use more of the other. So again, if you think of the price here as the data you're giving, how should we think about data issues and privacy and tech? And, you know, here I think there are very genuine concerns. So people, when they use Facebook or Google or even email, they tend to think of those as private actions, and they are and they aren't, but I would say there's a pretty wise perspective where they are not private actions. So Google the company basically has a record of what you have Googled. And they're not using it against you right now, but it's information. Could it leak out? Could it be hacked? Is it a potential vulnerability for you. I think it is. Facebook, in essence, has a huge zip file, not only on people using Facebook, but even people who are connected to those using Facebook. That zip file has a lot of information about you. The major tech companies, typically they're able to track your devices. So if you have like an iPad, a smartphone, and some laptops, which is like my life, I actually have two iPads. And just statistically, like what you do on them, the algorithms figure out that they all belong to you. So if you like search for, you know, vacation in Miami on your laptop at work and then you come home to your iPad and you start seeing ads in other places for vacations in Miami, like the system knows., right? It's not that there's some person at Google or Facebook like, "Oh, you know, James, he searched for this," and they're sitting there, "We're gonna send him this ad," right? It's done by algorithms. So there's an anonymity. The anonymity makes people feel secure. Partly it is reasonably secure, but also partly it's a potential vulnerability for you. But I guess here's how I think about privacy. I think of all systems as having major privacy problems. So if you ask, like, who actually is most likely to abuse your privacy? The answer, I think, is your partner or partners, your best friends, your acquaintances, your family members, maybe your in-laws. In academia, it's definitely your colleagues, right? Always some amount of rivalry there. So the main privacy issues are actually fairly local. So this is an additional privacy issue, uh, but it's not unique to tech. And in some ways, I think tech makes some of these other privacy issues less severe. So one thing very striking in the data, I don't know if any of you have noticed this, but compared to when I was growing up, like the 1970s, young people today have less sex. This stunned me when I read it. You're all having less sex than your professors on average. Like, what is wrong with you? It's not that you're Like, have you forgotten how? It's not mainly what's happening. It seems, as best we can tell, young people are having less sex because they communicate from a distance better. So, they don't get together as much. So, when I was in high school— by the way, that's before I was having sex, in case you were wondering— but when I was in high school, like, you'd have a group of friends and you'd go over each other's house sex is basically every day. Ride your bike, later you drive a car, you walk if you could. Like every day you'd get together. You'd have like your internet chat group, like your Facebook group, except you'd all be there. It was like this amazing innovation. And you know, some of the times, not in my group, but like in some of the other groups, the cool people, that would lead to sex. People get together less often, there's less sex. There's less sex. You may think that's good or bad, but in some ways, you know, there's more privacy because there's less sex. So by being more at a distance, it's actually my intuition, there's more privacy because of tech. I'm not sure it's in every way a good thing. Like maybe the sex is better than the privacy, right? Take a guess. I don't know. I genuinely don't know. It's going to differ across people. But the notion that sex Simply tech is this big violation of your privacy because a hacker, like, could get at information held by Facebook and Google. Probably, like, the 3 companies best in the world at protecting your information are Facebook, Google, and Amazon. That does not mean there will be no problems. But their problems We would probably like the very best equipped. And if you look at some of the major privacy violations, one of the biggest has come through credit reporting agencies, which are not tech. But they are much easier to hack because they are not so technically sophisticated. So a company called Equifax was hacked. All kinds of information about people handed out that can be used against them for financial fraud. Another of the big privacy attacks was done against— guess— the United States government, the Office of Personnel Management, which has data on all these US government employees. It is believed a lot of that data has been sold on black markets so that phony passports can be created based on real data about people. We don't really know yet the full ramifications of that. Communications, but it is believed maybe now, maybe over a longer term, this makes our country much more vulnerable to spying, or you more vulnerable to someone impersonating you in some way. So privacy is a relative matter, and in comparative terms, it is not obvious to me that Big Tech has made privacy worse. Uh, the one technical development that I most worry about in terms of privacy is just surveillance. Facial surveillance and what is called gate surveillance. So if you go to China, which I recommend to all of you just as an experience— some of you here may be from China— uh, there's a remarkable amount of facial surveillance. So you go to a Chinese railway station, There's an entering holding pen. You're supposed to wait there for like 5 seconds and basically look at the camera and it scans your face. And from there on in, you are known to the Chinese government. You are tracked across the country. The last time I was on a Chinese flight, the flight landed, the authorities came on with the printed out black and white sheet of a man's face. They looked at every passenger, compared it to the sheet, found the man, arrested him, carted away. Odds are that person will not really be heard from again. Now, he may have been guilty. He probably was guilty of a real crime. But over the longer term, when this is also used against political dissidents, this makes me uncomfortable. I find this a negative invasion of privacy. Right now, the major practitioner of facial surveillance is various governments, most of all in China, but not only in China. So this makes me very nervous. So again, I do think privacy is a real issue, but the big violations of your privacy in the future are probably through surveillance. There's now in China— it's a system you might either find —neat or horrifying, I'm not sure. But there's a lot of intersections, like in Shenzhen and Shanghai. If you jaywalk, which is like not a major crime, right? It takes a photo of you, it identifies you, and they automatically deduct the money from your bank account and fine you a ticket. You don't even like have a choice to pay. The money's gone. You get a little notice in the mail, "You jaywalked." No real right of appeal. People jaywalk less, right? Like there are some gains. But overall, that development makes me very nervous. Here's something I find striking. So, like partly you can blame the government, but I think it's wrong to just say, "Oh, this is bad evil government, China. Oh, we're better than that." I don't know. A country that has not sophisticated surveillance the way China does, but they tape a lot of things. A lot of things. So the United Kingdom, especially the cities, they call it CCTV, which is plenty of that probably in this university. There's plenty of CCTV. And it really does play a role in lowering crime. And it's interesting, if you look at different parts of the UK, typically neighborhoods ask to have CCTV installed because they know it will lower the rate of crime. So it's like government who does it, but it's people who are demanding it. I can easily imagine once the UK technologies catch up to Chinese that British people will be demanding Chinese version of facial surveillance. Ah, this makes me nervous. Again, it will have real gains. So a lot of people who are falsely accused of crimes, which especially in this country is a big problem, ah, they will get off because there's like a tape. It's like, "No, I wasn't there. I didn't do that." And you can prove your innocence. I was in Singapore like a month ago, and I was giving a talk, and I took a cab to the talk, and like an idiot, I left my smartphone in the cab. So just being like a foolish provincial American, I'm like, "Oh, my smartphone." Like, that's toast. It's gone. And I, you know, emailed my wife using my iPad, which is much better than the iPhone, like I said. And, you know, she commiserated. And then it occurred to me, like, wait, I'm in Singapore. And Singapore has a lot of surveillance. So I worked backwards and I found the person who had access to the CCTV tape of that cab picking me up. And I managed to get my hotel to call the taxi company, and they found that cab, and the cab driver came back and brought my smartphone to me. Like, that's awesome, right? So in that moment, I was very happy there was so much surveillance. But I'm still very nervous about surveillance because the more powerful it is for good, also the more powerful it is for evil, or just problems. So again, like some of this you can blame on the government. The government is in part responding to what citizens demand of it. But I think that's the real surveillance issue. Not that like, you know, buried in the databases of Facebook and Google, there are files on what you've done searches for. So, that's one issue. So that's one issue where I think like there's an issue with big tech, but I view it very differently than the current dialogue, which just says big tech violates your privacy. Another argument you hear is like social media tech ruined American politics. That's an interesting claim. I don't think we should reject it, but I don't think we should accept it either. I think right now we don't know, but I don't really see the evidence for it. So you can argue— I don't want to get into this, but let's say you agree that American politics is more polarized. I know it is amongst the intellectuals. I'm not sure it is like with real people. But let's just like say it is. Some people say, "Well, this is because of social media." And then you go to Twitter. On Twitter, everyone's yelling at each other, all these polemics. I'm on Twitter, like, I get that. I can see it. Most people are not on Twitter, right? Twitter is like a very niche thing in this country and in a lot of the world. What I do see in the data is that the most polarized people actually are older people. Older people are the least likely to be on Twitter or even Facebook, or if they're on Facebook, they're not the most active or they use they use it to be in touch with their grandkids. What older people really do much more than younger people is watch cable TV. And cable TV is really polarized. So again, I don't want to tell you I know. I think the data are inconclusive. But what we see so far seems to point more to cable TV than to social media in polarizing this country. I would just say be agnostic. There'll be more years, more data. But when people just say like, "Oh, social media, we're all at each other's throats. We all live in these bubbles." Data don't really support that. Data seems to blame cable TV. Also, a guy named Jesse Shapiro, he teaches at Brown, he did a paper where he measured people's media diets. So he found like if you're a conservative on the internet, on average, you're following like 60% from the right, 40% from the left. Like, that's not balanced, right? But I was actually shocked it was 60/40. Like, that's not that far from even. And then he went out and like measured like just your friends. So if you're like conservative or like progressive, whatever, like your friends could be 70-80% the same as you. So again, in this data, your friends are way more polarized than your online life. So again, I don't think we really know what's caused American politics to have become so strange, but just to like blame the internet, blame Facebook, blame Twitter, it's really not supported by the data. In this country, there are many people, especially in the media but not only, who are very upset that this country elected Donald Trump as president. The purpose of my talk is not to take a stance on that one way or the other, but I think there's been a need, in essence, to find a villain, someone to blame. To just admit that somehow he was elected because he won the election, people find very disquieting. So it can be like the Russians, it can be Facebook, it can be social media, uh, But I think it seems mainly, no matter what you think of him, Donald Trump won the election because he won the election. So I think that's one reason why opinion has turned against tech so much. There's another argument you hear a lot, which again I would say don't dismiss it. Like, I think it's an important argument. There's something to it, but don't overrate it either. And that is is the belief that tech has ruined our attention spans. So, like if you have an iPhone or a lot of smartphones, you can like look on your phone. How many times did I touch my phone yesterday? You ever do this? It's scary, right? It's pretty high. Again, for me it's the iPad. So, like is that wrecking our minds? You hear that claim a lot. I think, you iPhone, it's only 10 and a half years old. And a lot of people having them is much younger than that. So I would stress, like, you know, as a researcher, economist, scientist, that we don't know. But here's just a few things to think about. First, if you look at test scores in the United States, they're rising slowly. Like way too slow. I'm not saying everything in our schools is is going great, but they're not falling. They're rising slowly. The rate at which they're rising— there's noise in the data. It's not clear that rate is getting worse. If you look at our worst school systems, and we have many bad ones, terrible ones, I'm pretty sure there's no case where, like, the problem with those school systems is too much tech. They have a lot of other problems, but just anecdotally, you visit America's worst schools, you will not come away shaking your head saying, "My goodness, too much tech has ruined that system." Does not seem to be the case. Like bad teachers, you know, indifferent parents, bad principals, bad incentives, whatever, too much tech, I don't see it. You go to what are rated as the best high schools, there's There's one in Northern Virginia called Thomas Jefferson. Occasionally it's rated the very best high school in all of America. Like it is a tech high school. Like you go there to do tech. And it's been rated as the best high school. It doesn't like prove cause and effect. But maybe like the problem with young people, if there is one, maybe it's not mainly tech. What I see is a lot of people still doing things that are like really long term. So if our attention spans are ruined, like why have so many people and mostly young people read Harry Potter? Those books are long. And like, I'll add on, I've tried reading those. I can't do it. They're like too long for me. I had my first 30 years like with no— my first 46 years with no smartphone. And Harry Potter, it's like too long for to my attention span, and it would have been like when I was 20 or 30. It's just too long. Or like Game of Thrones, or people doing these marathons on Netflix. That's like a lot of attention, very long-term things. If you measure what's the average length of a published book today compared to 10, 15 years ago, it's gotten longer. So the simple claim like, "Oh, tech, it's ruined our attention." attention spans, we're like all just, you know, this on the phone, we don't ever read long books anymore. It just doesn't seem to be true. Again, I don't want you to dismiss this claim because on a daily basis most of us live out some version of, "Oh, I've got to check my phone again," right? Like there is an opportunity cost to that. But if you're simply naively arguing like societal attention spans have collapsed. That doesn't seem to be true. There are a lot of long things that are quite popular. Possibly what's true is there's like an increase in the variance. There's like the really long and the really short, and we like each of those more. I'm not sure. Like, is that better? Is that worse? I think we don't know. So again, keep an open mind on that. But when you read like the 37th media article about how tech is ruining our minds, as far as I can see, millennials are doing just fine. Their main problems are student debt and the recession inherited from 2008-2009, probably not tech. Just a few more remarks before I close on why tech has become so unpopular. I think biggest thing It's just tech is putting a lot of media companies out of business. So tech, Facebook, Google, they sell ads. Newspapers, magazines, they sell ads. Who is winning that competitive battle? Tech companies. So media are very upset at tech companies. There's a very direct resentment. I've worked in or for a lot of media outlets and I can vouch for this personally. Tech is is crushing media in some regards, and that may have a problematic side, but I think it's meant media is now biased against tech. There's the desire to look for a scapegoat for Trump winning. I think there's something about some of the tech services where you're kind of intrinsically unhappy with them to some degree. So take something like Facebook. Like, you're mainly on Facebook. If indeed you are, because a lot of your friends are. So, you get a service kind of geared to the median user. It's designed to make a lot of people happy, like Microsoft Word, but it's not actually the best possible product for any particular group of people. There's a least common denominator element to the product. And when it's something that everyone wants to use in common. That's very often the case, that it doesn't appeal to any one group very much. And that means you ask any one person, "Well, what do you think of Facebook?" They have a long list of complaints. You heard me before earlier, what do I think of Facebook? I had a list of complaints. I could go on if I wanted to. But at some point, like realism has to set in, like common services by the nature what they is commonality and a lot of people will be unhappy about the particulars. It's not really a fault of tech. It's just a trade-off you make when you go common. I think also Americans really hate the media. Forget about tech. Just think like media, newspapers, TV, because what the media does is like raise or lower the status levels of different groups. Like conservatives are better than you better than you thought, conservatives are worse than you thought, you know, the military, the clergy, this politician, you know, feminism, different media outlets are all trying to make these things look better, look worse. And I think by human nature, we are more sensitive to insults than to praise. So, if people like sit down and tell you what they think about you and you get 10 compliments and 1 insult, I bet you feel bad. Media media by its nature is sending you both compliments and insults. And the insults make you feel bad. You blame media. Like, "Oh, media is too left-wing." Or media is like too pro this group, too pro that group. Basically everyone's unhappy with media. Trump's insight was he realized he could run against the media. So as tech companies become more like media, gateways to media, they have to make decisions on filtering content. People start to dislike tech companies for basically the same reasons that they disliked the media. Anyway, for my formal remarks, I'm out of time. We'll have 15 minutes for questions. Let me just say, I know I haven't covered all of the different angles of tech, but keep in mind when you read about tech, you're reading from the media, tech's main competitor. There's a conflict of interest there. And At the margin, you know, I think a lot in America is on the right track. I don't like everything in American politics. I think our country has like an ugly, bloody, actually pretty oppressive history. But when I think overall, like at the margin, is tech making that better or worse? It seems to me mostly it's making it better. And with that, I will close and open to all of you for questions. And you can ask about anything you want. Thank you all for listening. If you want to ask a question, we have microphones.

Questions are for students first, and then non-students can go second.

Make your question short if you have one to ask. Hi.

Thank you so much for being here. My name is Nicole. But as you were speaking, I was pondering the trend you mentioned towards the end, the trend towards the least common denominator. And I think a trend towards mediocrity or the average person is— can be seen in a lot of other aspects. And I know Alexis de Tocqueville talks about it in Democracy in America. But I think that's an interesting trend, especially compared to your point about increased variance. And I know your book, Averages Over, talks a lot about that. And so does Coming Apart and several other popular works right now. So could you talk about how those work together or if they are in direct conflict?

I think of the Internet as the greatest niche product ever invented. So, you can find your group, your fellow hobbyists, those people like you or people with your preferences of any kind, you know, including for sex or marriage, whatever. I met my wife on Match.com, by the way. Wouldn't have met her otherwise, most likely. So, the kind of the stuff you get from it is super niche. But like the platform itself, like that's how it works. It's got to be for everyone. Like the world's richest person, I guess Jeff Bezos and I, like we both access the same Facebook, right? It's the same. Like we drink the same Coca-Cola, we access the same Facebook. And the platform is homogenized. But I think like American culture as a whole being homogenized, the era of like stupid mass celebrity peaked in the '80s and what crushed it? Was basically rise of the Internet in the '90s. And if you're like at all different or unusual, like it's striking to me if you look at gay couples right now, like 50% of them meet on the Internet. And obviously there are more hetero people than gay people. So, if you're gay, it's just harder to meet people you might want to marry and you use the Internet. And that's just a very simple way of measuring how niche the Internet is in a positive way. So, like mass culture peaked in the '80s. I'm happy to see it gone, let me tell you. It was rough. Thank you. Thank you.

Recently we have seen a lot of deplatformization happening. First Alex Jones and then right-wing, left-wing, libertarians all have seen their platforms go. Some people have suggested has suggested that we treat the internet or the internet companies as a kind of public utility in which people who do have some type of show on YouTube cannot be so easily deplatformed. Um, and that there's basically some type of conspiracy to wipe out dissidents in America or even the world. I'm wondering if you could address that. It's a very good question.

I don't think we've seen a lot of deplatforming. I think we've seen a small amount of it. It's a potential concern, but keep in mind the tech companies didn't want to have to make this decision at all. It's when external parties started demanding it of them. To some extent, that was actually their own employees who got upset, and employees at major tech companies tend to be pretty left-wing, at least nominally. I think kind of de facto they're actually pretty capitalist, but they vote in left-wing ways. And they got upset at their parent companies. There are always other places you can go. Being deplatformed itself gives you a kind of status. Before the major tech companies, none of these platforms platforms existed at all. So it seems to me that on net, again, the major effect has been to elevate the niche and hurt the mainstream. So if the net effect is a big boost for niche and some niche gets cut off at the legs because it's deplatformed, to me that's still a positive story. But, you know, I don't agree with every deplatforming decision. Necessarily. I wish we didn't have to make them. I don't think there'll ever be a good way of making them. I don't at all trust the government to make them, at all. So I'd rather muddle through with what we've got. Dr.

Cowen, thank you for being here and for providing your lecture. In one of your previous books, "Average Is Over," you kind of explained that there's going to There will be a division in the American workforce where about 85% of workers will engage in scripted work that the other 15% write and direct using machine learning and automation and technology. But since then, there's, as you mentioned, there's been a lot of changes in big tech and in machine learning and automated technology. Do you still see the mass, the minority of the population writing these scripts, or do you still see the possibility machine learning causing the rise of a potential jobless, effectively useless class? What do you see as the effect of machine learning automation in terms of the workforce overall and especially young people like us?

I think automation and machine learning will have profound effects. They've started already to. I don't worry about joblessness. So two of the economies where automation is furthest along are the US and Japan. Those two are basically at full employment. I do worry that we don't teach the right skills for people to succeed in this world. So, I think we'll have a large share of America doing jobs of personal face-to-face service, which will not quite be professions with upward career ladders in the way we would like. I think that's one of the biggest problems in this country today. It's just how many people get stuck on tracks where there's no upward-moving career ladder and the skills they have are good enough for the job they have, but it's somewhat of a dead end. And then you have another collection of people, sometimes misleadingly called the top 1%, but it's not the top 1%, it's like the top 15%, and they're just doing great. And they're connected with major firms and they're very skilled and typically they use the internet well and often their companies or their businesses export to the broader world and their wages, income, capital gains, you know, have been going up at a pretty rapid clip. And I think that's our current division that we need to solve is how to get more people off of the dead-end tracks onto the productive tracks. And now if everyone could do machine learning, wow, that would be an easy solution. But of course, that's begging the question, right? Machine learning is really hard. In any imaginable future, like most people can't do machine learning. So, I think, you know, a big part of our country will look like that for the next generation. And one of my hopes is, as we have more people who just grow up as digital natives using the Internet, that as they enter job markets, they'll be more upwardly mobile than the previous generation has been. But that's a speculation. I don't think we know yet. I'm hoping that growing up with this stuff will make a big difference. Hello. Yeah.

So, I actually have a question about something that's tangential to what— a little tangential to what you talked about. You discussed sort of lowered interpersonal interaction between between younger people. And obviously you can't cover every criticism of tech in the talk, but one that you didn't mention that I would like to sort of gauge, you know, your reaction to is that we do have a lot of research right now that says especially Facebook but also other social media companies or just social media use in general really causes mental health problems for younger people. And especially depression and anxiety, particularly with women, just because we have all this research that says that neurologically humans need to interact with other humans to be happy. And in some senses we've kind of created a generation, which is why we see these suicide rates and depression rates and whatnot skyrocketing among younger people, I would assume. I don't know this. But is that they're not getting that interaction and the online platform is sort of depriving them of that. Is that something that you, you have an opinion on in relation to Big Tech?

It's a very good question. I think the evidence is not yet conclusive, but there's probably something to what you're saying. If we look at children from educated families, typically their social indicators are getting better. And in some aggregates, like alcohol abuse, drug abuse, other than opioids, which are not generally teenagers, actually social indicators are getting better. Social media have a lot of different effects. So if you grow up as being in some way different or nonconformist, the chance that social media make your life a lot better is a very real effect that a lot of people abuse social media and become too lonely or depressed, that is probably true. It's hard to know that causally. But if you look overall at the data on the sequence of generations, like in the Charles Murray book, Coming Apart, the fundamental distinction seems to be between educated and not educated and not social media using versus not social media using. So, I'm more optimistic than the pessimists, but I think there are clearly cases of abuse. And we need to improve how we use social media. It's a very new technology. A lot of technologies at first are very badly abused. Alcohol would be an example where when it first comes to, say, indigenous societies that did did not have it before. There is rampant abuse. Often, though not always, over time norms develop. I suspect we are seeing some of that with social media. It's a new thing. It's come to us like alcohol. There is definitely abuse. We will, I hope, I think, develop norms to limit that abuse. That would be a response, not really an answer. I do think there's something to the charges you're raising. Last question.

So I'm going to Cape Town, South Africa with an MBA trip in May, and I'm wondering what I should pay attention to.

And then a second question is, city of Louisville, underrated or overrated? What was that? The what overrated?

City of Louisville, where we are.

It's funny, I was just telling Sophia, who came with me from Institute for Humane Studies, how underrated Louisville is. This is, I think, my fourth trip. You have great food, you've had local economic development in a way which is revitalizing, you have a lot of America's finest, like, small city architecture in neat styles, a genuinely, like, vibrant local art scene, reasonable weather here in the middle of the country. It's pretty awesome, and most people don't know. So I would say definitely underrated. Now you ask about Cape Town. I've been going to Africa a lot lately. I had a Nigeria trip last year, which I would recommend strongly. I know the world says it's terrifying and they'll like boil you in oil or something, but, you know, I went, it was fine. I spent 10 days in Ethiopia in May. Was one of the best trips of my life. Safer than Nigeria, I would add. There is some crime in Nigeria. Again, I haven't been to Cape Town. I believe South Africa is one of the more dangerous parts of Africa. So, like, be careful would be my main advice. But I would say keep in mind Africa could be the most important part of the world right now. Now, like going to see it, think about it, just treat it in some non-clichéd way, whatever you end up thinking about this particular trip is one of the very best educational experiences you can have or give to someone. So, like, do what you can, see what you can. I don't wanna, like, tell you take some chances, but take some chances. And there's incredible music there, unbelievable South African music. I love it. Indian food The food, I've heard, is great in South Africa. And all sorts of reasons to go, none to stay at home. So I'm delighted to hear what you report. With that, I am told I am done.