Thursday, April 7, 2016

Trump and the transition to a post-industrial society

Trump and the transition to a post-industrial society

            Sam Vaknin a popular philosopher/psychologist, and a contributor to the American Thinker, a center-right website, describes Trump and his followers in very harsh terms. As he writes in one blog post, “The world is a hostile, psychopathic place and who best to deal with it than an even more hostile, narcissistic leader like Trump? We need a big bad wolf to navigate through the jungle out there. This is a form of collective regression to toddlerhood with Trump in the role of the omnipotent, omniscient Father. In abnormal psychology this is called ‘shared psychosis.’ The members of the cult deploy a host of primitive (infantile) psychological defense mechanisms as they gradually dwindle into mere extensions and reflections of their skipper. Theirs is a malignant optimism grounded not in reality, but in idealization: the tendency to interact not with Trump himself, but with an imaginary “Trump” that each fan tailors to suit his or her fears, hopes, wishes, and fervent fantasies.”
This is a vitriolic takedown of Trump and is followers, and in light of Trump’s self-declared disregard for civility in political discourse it feels partly justified. The question is however, whether such a blanket dismissal undermines our ability to understand the realistic bases for Trump’s strengths and successes, and leads us to treat his follower’s sensibilities as if it they are alien. Of course today, in a post-holocaust world, we are especially attuned to the dangers of totalitarianism and we are rightfully wary of politicians who appear as “strongmen.” On the other side, these same concerns may lead us to take mental shortcuts. While looking at history through the rear view mirror we don’t take account of what is in front of our noses. Can we first comprehend without judging and then only judge as a stimulus for our taking action? In the Art of War Sun Tzu writes, “If you know your enemies and know yourself, you will not be imperiled in a hundred battles; if you do not know your enemies but do know yourself, you will win one and lose one; if you do not know your enemies nor yourself, you will be imperiled in every single battle.” The danger of Vaknin’s stance is that he does not know himself. After all, his own prose projects a sense of omnipotent knowing, the very charge he levels against Trump. This suggests that he neither knows Trump nor his followers.  
In the following blog I try to “know” Trump by taking seriously what his supporters say and by trying to locate their experiences in situations that are in some degree accessible psychologically to all of us. This process takes me on a road trip through Trump’s unrestrained behavior, his followers anxieties about political correctness, the populist character of Trump’s movement, the link between populism and the our shared transition to a post-industrial society, and finally the Republican Party’s failure to understand the role of regulation and social policy in shaping that transition. I am interested in my readers’ responses to this trip on what is hopefully a not too long but certainly winding road.

Trump unrestrained, and political correctness.

          People who support Trump like his unrestrained and unrehearsed behavior. He appears to be acting impulsively, saying whatever comes to his mind without preparation and rehearsal. To his supporters this means that he speaks truthfully rather than censors his thinking to garner favor or support. This also means that he is independent, beholden to nothing but his own instincts. As one supporter said,Lies are out, unrehearsed truth is in,” and as another noted, “What you see is what you see, all the cards are on the table, the words are non-rehearsed, flowing forth and engendering a sense of trust.” A third commented, “because he is 'crazy impulsive' he has no qualms to step on toes when he is on a roll, and correctness (neither political nor ethical) enters in his objective.”
As this last comment suggests, supporters also take pleasure in his aggressiveness in his “stepping on toes.” As one supporter writes, “So I love Trump. I fucking love him. I wish he were actually going to run all the way to the White House instead of just fart around until the primaries like he usually does. I wish he'd take shots and get on TV and give press conferences drunk off his ass. I wish he'd tell reporters to go fuck themselves. I wish he'd treat International diplomacy like it was an episode of what's his show where he got to say "You're Fired". I LOVE that he pisses off all the politicians on both sides, because he's different than the good old boys (and gals) that come up year after year after year.”
One question of course is why do supporters take such pleasure in his impulsiveness, irresponsibility and aggression? After all, it is also boorish. If we look at this psychologically, one reason we may take pleasure in someone else’s impulsiveness is because we ourselves feel unduly restricted and suppressed. This is a common and familiar feature of celebrity culture. We enjoy a movie star’s chaotic love life because it contrasts with what we may experience to be our own dull one. Identifying with a star, we share through fantasy in his or her exciting experiences. This is also why when Republican Party leaders such as Mitt Romney lambast Trump for his incivility and boorishness, they only underline why his supporters find him attractive.
But this pushes our question one step backward. Why do his supporters feel psychologically hemmed in? It is tempting here to turn immediately to an account of their hemmed in lives, but I think we are on surer ground if we listen to what his supporters actually say. One reason they advance is that they feel oppressed by the psychological injunctions associated with political correctness, by the degree to which it suppresses expression, and censors thinking.  As one supporter writes, “Political correctness is a main reason why America is in trouble because it is a grind and so draining to be so politically correct everyday in our personal and professional lives.” The images of “grind” and “draining” suggest that people feel burdened or exhausted by the work of suppressing thoughts and impulses associated with experiences of race, ethnicity and gender. By contrast, Trump bears no such burden. As one supporter suggests, Trump's speech is uncensored. “Every week, someone would dare to blurt out something un-PC, and the media would absolutely crucify them. Political correctness is the birthplace of disastrous, un-American policies that will destroy the country in a death by a thousand cuts. But here comes Trump, the first person who didn’t even blink when the machine turns its sights on him. He didn’t just fight back. He chewed it up and spit it out.”
We might suppose that people feel censored, because they wish that they could freely express racial or ethnic animosity, in others words to be racist in public as Trump appears to be. But I think that the issue is more complex than this. One scholarly study of Tea Party supporters notes that there was, “strong opposition to explicit racism in the Greater Boston Tea Party. When avowedly racist messages suddenly appeared on the Boston Tea Party MeetUp site, Massachusetts Tea Party members let the newcomer know he was not welcome. Andrea (a leader of the Party), posted: “This country is made up of people from all countries, that’s what made us what we are. . . . I wouldn’t want it any other way.”
Instead, I suggest that what white people find burdensome, are the psychological consequences associated with the prospect of giving minorities preferential treatment in the competition for jobs, promotions, or access to college , or as it termed more frequently, creating diversity. A Pew values surveys “asks people whether they agree that, “We should make every effort to improve the position of minorities, even it means giving them preferential treatments. “Since, 1987, as the New York Times reports, the gap on this question between the two (political) parties as doubled. 52% of Democrats support this statement,  (and 48% disagree!-LH) while 12% of Republicans do.
It is customary to think that this antipathy toward preferential treatment is based on conflicts of interest between minorities and whites. This is why for example white students have sued state universities for failing to admit them, claiming that their qualifications were overlooked in order to admit minority students. But I suspect that when a large number of whites resent affirmative action they are responding less to such overt conflicts of interest, and more to the psychological contradictions imposed when considering racial preferences.
Let me suggest that racial preference programs stimulate the very racist thoughts they are designed to suppress. A good number of whites would wonder why minorities deserve special consideration, if they were not in fact inferior. I believe that this thought is aversive and horrifying for many, though not all white people, as indeed it should be, and creates in its wake considerable guilt. This is one reason, for example, why in the famous case of Jayson Blair -- the black New York Times journalist who filed false reports -- his superiors failed to act on their suspicions that he was unethical and irresponsible. Their own suspicions triggered the accompanying idea that they were racist to be suspicious. One way in which whites in such positions then manage their anxiety associated with this thought is to view the minority person as a victim who warrants special consideration. But this too is a demeaning thought. For example, it denies to Jayson Blair his own agency in creating the conditions that lead him to his unethical conduct. In other words, political correctness, when linked to the issue of preferential treatment, sets in motion a complex of discomfiting thoughts, feelings of wariness and guilt, and then resentment for having experienced these feelings. This is, I propose, one psychological account of the meaning of political correctness for Trump supporters. He has freed himself from this nettle of feelings, the draining impact they impose on the psyche, and behaves without guilt or compunction.  

The deserving worker
It is sometimes common to suppose that whites ought to understand that blacks in particular have been hobbled by overt and covert racism in the past, and should therefore be entitled to special consideration. But clearly, many whites reject this idea even after decades of its ascendancy in liberal discourse. Indeed, one reason Bill Clinton won re-election in 1996 is that he severed the links between the Democratic Party and its once historical support for the rights of welfare recipients. Moreover, in the study of the Tea Party I referenced, the authors note that Tea Partiers are more likely than other conservatives to agree with the statement, “If blacks would only try harder they could be just as well off as whites.” In addition, “Tea Party activists in Massachusetts, as well as nationally, define themselves as workers, in opposition to categories of non-workers they perceive as undeserving of government assistance. Concerns about freeloading underlie Tea Party opposition to government spending.”
It might be supposed that people with this viewpoint are simply being selfish. But this is a cursory conception. I think this commitment to the link between work and reward is first and foremost a moral one. It is an ideal, and seems to be a good basis for sustaining group efforts whether in a team, a company or an entire economy based on exchange. It addresses the most elementary demand we make on group life, that it be “fair.” It expresses a basic anxiety, that in any group there is always the risk that “free-riders” will exploit group members’ good will, by working less while sharing in the group’s rewards. It can also serve as a critique of tax evasion, cronyism, bribery and “pay to play” as much as it does of “welfare payments to the undeserving.”
But moral principles are two-sided. When fulfilled they provide self-esteem, but when violated they induce shame. This is why, for example, religious people are often ashamed before themselves, by their private sexual peccadillos, even when the latter are trivial or harmless. One hypothesis is that Trump supporters, and the white working class men they represent, are at risk of feeling ashamed before themselves, because increasingly they can’t get access to the opportunities for hard work that merit fair rewards. It is common knowledge that wages for high-school educated men have been stagnant, and that manufacturing jobs, which once secured them good living standards, have been declining in numbers for decades.  One way to cope with the resulting shame is to project it on to minorities, immigrants and others who live on the margins and have even fewer opportunities to do hard work. The “freeloader” becomes the social scapegoat, a symbol of a condition that threatens “us,” not just “them.”
Deterioration and pain
Consider the following. Anne Case and her co-author, The Nobel prize winning economist Angus Deaton, point out, that there has been a “marked increase in the all-cause mortality of middle-aged white non-Hispanic men and women in the United States between 1999 and 2013. This change reversed decades of progress in mortality and was unique to the United States; no other rich country saw a similar turnaround.” The authors link this trend to “drugs and alcohol, suicide, chronic liver disease and cirrhosis.”
Moreover, as Deaton and Case show, this same group reports increasing physical pain. “One in three white non-Hispanics aged 45–54 reported chronic joint pain in the 2011–2013 period; one in five reported neck pain; and one in seven reported sciatica. Reports of all four types of pain increased significantly between 19971999 and 20112013. An additional 2.6% of respondents reported sciatica or chronic joint pain, an additional 2.3% reported neck pain, and an additional 1.3% reported facial pain. This increase in pain is one reason that there has been a significant increase in the use of opioids which itself can be a trigger for suicide.
The question is, why has this happened? Pain lies at the intersection between the physical and the psychological. It is also what psychologists call “ego-alien,” meaning that we experience pain as an “other.” That is why we commonly call it an “It” as in, “It hurts.” Distancing ourselves from our pain is adaptive insofar as it allows us to treat “it” with measures that are in themselves painful, for example, in the extreme, amputating an injured limb. 
But at the same time, in distancing ourselves from our pain we are less likely to tackle those causes that are part and parcel of our experience.  For example, if stress leads to back pain, treating it as an “other,” we are less likely to confront those sources of our stress that are part of our lives, for example our low wages, or our children’s poor prospects. Instead we medicate “it,” accentuating our helplessness. This is also what Freud meant by psychological repression. We treat thoughts and feelings that are psychologically painful as if they are alien, not ours, only to discover that they continue to exert a claim on our unconscious attention.
By contrast, good social ties help us ameliorate pain by integrating us into a network of friends and loved ones who, under optimal conditions, buffer us from stress and help us cope with adversity. This is one reason a good working-alliance with a therapist helps people come into touch with their unconscious thoughts. We join a larger social “whole,” our personal network, or our helpful therapist, to undo the split within, between our ego and “it.”  We see this everyday among small children who happily receive our kisses to make their “boo-boo” feel better. Pain in this sense is a measure of social isolation.
This account of the psychosocial basis of pain also explains why Deaton and Case found that suicide is increasing. Ever since Emile Durkheim published his classic study of suicide, it is commonly understood that the social basis for suicide is social disintegration, that is, people no longer feel psychologically linked to their communities. Robert Putnam in his now classic text, “Bowling alone” indeed found that people in working class communities feel increasingly isolated.  They participate less in the panoply of settings, what sociologists call “mediating institutions,” such as labor unions, the Boy Scouts, the Red Cross, Churches, the League of Women voters, the Elks, and Parent-Teacher associations, that once glued a community together.
For example, Putnam writes, “For many years, labor unions provided one of the most common organizational affiliations among American workers. Yet union membership has been falling for nearly four decades, with the steepest decline occurring between 1975 and 1985. Since the mid-1950s, when union membership peaked, the unionized portion of the nonagricultural work force in America has dropped by more than half, falling from 32.5 percent in 1953 to 15.8 percent in 1992. By now, virtually all of the explosive growth in union membership that was associated with the New Deal has been erased. The solidarity of union halls is now mostly a fading memory of aging men.”
This conception of social isolation fits with the understanding that Trump supporters feel as if they have no voice. As The Atlantic reportsIf there were one question to identify a Trump supporter if you knew nothing else about him, what might it be? “Are you a middle-aged white man who hasn’t graduated from college?” might be a good one. But according to a survey from RAND Corporation, there is one that’s even better: Do you feel voiceless?”

The Tea-Party and populism.
The history of the Tea party is suggestive here. It was set in motion by Republican Party elites, gaining support and traction from FreedomWorks, “a multimillion-dollar conservative non-profit led by former House Majority Leader Dick Armey (R-TX). FreedomWorks is closely aligned with the Tea Party Express, a project of the Republican-run political action committee, ‘Our Country Deserves Better,’ which has provided hundreds of thousands of dollars in support to conservative candidates.” In addition, Fox News provided the Tea Party with significant publicity in its early days. Yet Tea Party members soon used it to undermine the elites that started it. In an early foretelling, a Tea Party activist in Virginia, David Brat, defeated Eric Cantor, the Republic Majority Leader in the House of Representatives in a 2014 primary election for the latter’s congressional seat. The Tea Party, and the Trump supporters it helped galvanize is now the voice of its members, not its founders. After all, Trump supporters now threaten to undermine the Republican Party’s capacity to mount a legitimate party convention.
This phenomenon of a once voiceless group helps account for why analysts call Trump’s supporters “populists.” One trope that emerged early in the primary season was that Trump supporters were authoritarian.  But as two researchers, Washington PostThe AtlanticWhite Middle Americans express heavy mistrust of every institution in American society: not only government, but corporations, unions, even the political party they typically vote for—the Republican Party of Romney, Ryan, and McConnell, which they despise as a sad crew of weaklings and sellouts. They are pissed off. And when Donald Trump came along, they were the people who told the pollsters, ‘That’s my guy.’”
writesLike the joker from The Dark Knight, I just want to see the world burn,” 
or as another notes, “Hell, if Bozo the clown was running, I would vote for him,” or, “So, I will happily bide my time dancing foolishly under Mr. Trump's brightly-striped tents and festive lights. Drawn to the man and his message like a moth to a flame.” 

This anti-elitism also explains Trump supporters’ admiration for his unrehearsed performances during the primary debates. As ABC reported, “Candidates usually spend hours and hours preparing for a major debate -- reading up the issues, going through practice Q & A sessions or mock debates and practicing lines to use when the big moment comes. Not Donald Trump. ‘Trump doesn’t rehearse,’ a senior Trump advisor said today. It’s not that his political team hasn’t tried. Trump’s aides have prepared him memos on the issues and the expected lines of questions and potential attacks from the other candidates, but there have been no formal debate prep sessions, no mock Q & A, no practice debates.”
Elites try to exert control in politics, corporations and in large not-for-profit organizations by attending carefully to their strategies for communicating with their various publics and stakeholders. This is the heart of public relations work and may at times entail deceit or at least misdirection. Thus for example and most strikingly, the Tea Party’s origins, lay in, “Tobacco companies’ attempt to create the semblance of broad opposition to tobacco control legislation and to defend ‘smokers’ rights,’ against the charges associated with second hand smoke. These efforts failed, and in 1990 as several researchers note,Tim Hyde, RJR director of national field operations, outlined a strategy for RJR to create ‘a movement’ resembling what would later emerge as the Tea Party by building broad coalitions around the issue-cluster of freedom, choice and privacy. (As he wrote), ‘Coalition-building should proceed along two tracks: a) a grass- roots, organizational and largely local track; b) and a national, intellectual track within the D.C.-New York corridor. Ultimately, we are talking about a ‘movement,’ a national effort to change the way people think about government’s (and big business’) role in our lives. Any such effort requires an intellectual foundation–a set of theoretical and ideological arguments on its behalf.’”
The dilemma with public relations is that it becomes less effective as it becomes institutionalized. People become inured to its claims, suspecting reasonably that messages cloak interests that are not truthfully revealed. Politicians are suspect as voters learn that their messages have been carefully crafted using focus groups, voter research and tests of advertisements. This creates cynicism, which is fact one emotional basis for nihilistic feelings. Cynicism is intellectualized self-pity, and is based on the experience of helplessness. The nihilistic fantasy reverses helplessness by helping the cynic imagine the prospective destruction of settings that are the seat of his impotence. The Trump movement goes one step better. It can undermine the Republican Party for real.

A substantial minority of Republicans—almost 30 percent—said they would welcome ‘heavy’ taxes on the wealthy, according to Gallup. Within the party that made Paul Ryan’s entitlement-slashing budget plan a centerpiece of policy, only 21 percent favored cuts in Medicare and only 17 percent wanted to see spending on Social Security reduced, according to Pew.”

The Republican Party’s weakness
This underlines a central weakness facing the Republican Party.  Marco Rubio, while a candidate, frequently referred to the Party as the “Party of Lincoln and Reagan.” One question this appellation raises is, what was the structural basis for Reagan’s power and charisma? After all in his character, he was quite detached from the role of president, and largely disinterested in policy. Let me propose the following. In the earlier phases of the transition to post-industrial society deregulation and the ethos of free markets were in fact developmental. They increased competition, decreased dependency on welfare, and helped create a climate of entrepreneurship. They gave substance to Reagan’s sunny disposition. These themes helped create an economic and cultural mechanism for harnessing investments in new technologies and for reordering labor markets.  Indeed, in many ways, Bill Clinton’s presidency rested on these very same achievements.
But this stance has come up against its own inherent limits. This is one reason that Reagan’s vision is no longer compelling to the Tea Party’s base, and why in fact Hilary Clinton, strongly identified with her husband’s presidency, faces strong opposition from the left. Most strikingly, the “production” of human capital is imperiled as students accumulate debt they cannot pay off, a central argument in Bernie Sanders’ campaign, while the social safety net is too narrowly conceived and constructed to help working class and underclass communities make the transition to a post industrial society. This is why Trump’s diatribe against free-trade has such resonance, even thought it violates a central tenet of the “Party of Reagan.”  It may be mistaken, in the sense that automation rather than trade has reduced the number of manufacturing jobs.  But restricted trade, and deporting immigrants are symbolic stand-ins for the social policies that are now necessary, but which Republican Party elites never understood nor advanced.  
Ironically, after Mitt Romney’s defeat in 2012, the Republication party tried to “post-modernize” its message by embracing the new minorities and creating a path to citizenship for illegal immigrants. This was to be Marco Rubio’s great legislative achievement, which the Republican Party quashed after the Tea Party defeated Eric Cantor, the Republican leader in the House of Representatives. But the Party could not anticipate that a part of its base was increasingly vexed by the elite’s mismanagement of markets, resulting for example in structural unemployment, low wage work, high indebtedness and diminished prospects for upward mobility.  This is one reason why Marco Rubio’s campaign, based on a post modern-identification with minorities, a conservative and religious temperament, and a commitment to free markets ultimately failed.

Coda: The working class
As extraordinary as Trump’s campaign has been, it is important to remember that he has never won the majority of votes in any primary. On average, he is has won about a third of the votes in each state election and of course this is counting only the Republican Party voters.  His supporters represent a relatively small fraction of the total electorate. Moreover, working class members of the Democratic Party have voted for Sanders. But his primary victories highlight the wider tensions we face as a society in transition to a post-industrial age.
Several years ago I saw a compelling photo on the Internet, which unfortunately I can no longer locate. It pictured a large group of United Auto Workers, with clubs and bats in hand, marching down a Detroit avenue in the great strike wave of 1948. It startled me to see this display of militancy and forcefulness.  The union workers were announcing that they could protect themselves. I thought at the time, that this moment, close to seventy years ago, but still within earshot of our current way of life, typified a period in which the American working class could represent itself and its interests without hesitation. It is striking to see Trump as an heir to this moment, and then to review the long and winding history through which unions withdrew from the primary task of organizing low-wage workers, in whatever sector they worked. Instead, they retreated to defending the privileges of their current members who worked in stable jobs.
Perhaps this development was inevitable. Could unions really have organized the large, sprawling and fragmented low- wage service sector of salesclerks, waitresses, fast food workers and janitors?  Instead, unions made their greatest gains among public sector employees, and unfortunately the scale of the pensions they have won in contract settlements with local and state governments have turned them into the taxpayer’s enemy.
In industrial society, politics gained coherence from its class structure; from the rough and ready distinction between workers and capitalists, manual workers and their foremen, finance and production. In a post-industrial society these easy distinctions elude us. Teams are self managing, learning is a part of work, the factory technician controls the computer console of the automated machine, and human capital begets financial capital as entrepreneurs raise money from venture capital firms. But in the resulting confusion a political moment can erupt and throw into high relief all the underlying conflicts that simmer below the surface. At that point the elites stand up and take notice, and we can as well. 

Wednesday, February 24, 2016

Yahoo's failure and the emotional web

Yahoo has just announced that it is positioning itself for a potential sale of its assets. The term “potential” is important. It is likely that several companies have expressed an interest in buying some or all of its assets; the press has identified Verizon, the wireless provider, as one possible purchaser. But there is as yet no actual offer. One reason Yahoo made this announcement is that many of its investors and shareholders believe that its CEO, Marissa Mayer, having failed to grow its revenue since her arrival from Google in 2012, has no sure plan for restoring it as a valued Internet company. In the final third quarter of 2012 — Mayer’s first three months as chief executive of Yahoo— the company made about $1.2 billion in revenue, most of it from advertising. Three years later, in the same quarter, its revenue was still $1.2 billion.  While Yahoo attracts millions of visitors to its site each month, it garners only 6.5% of U.S. online search revenue, while Google gets 77.7%. As one journalist writes, “Yahoo, which still has a billion people using its apps and websites, is an afterthought in many ad budgets.” By early February 2016, Yahoo’s share price was at a new 52-week low, about 50% off its November 2014 highs.

One reason Yahoo’s search revenues have declined is because Facebook’s growth flooded the display advertising market with inventory. “Demand from marketers could not keep up with all the new supply—ad budgets were not increasing at the pace of Facebook’s growth—and the average price the industry, including Yahoo, was able to charge declined steeply.” In addition, Google’s superior search algorithms and its method of auctioning off ad-positions on a web page, meant that it could charge significantly more for its advertising space. A 2012 study comparing the cost of a “click” on Google versus Yahoo shows, for example, that a click-through for “shopping and classified” search terms was 72 cents on Google versus 44 cents on Yahoo. Similarly, a click-through for computer and Internet search terms averaged $1.08 on Google, versus 40 cents on Yahoo. This is one reason why Google’s revenue has grown so rapidly. Yahoo once excelled in attracting advertisers with display or banner ads. But while in 2000 such ads accounted for 78% of online advertising revenue, by 2008 they accounted for only 33%, just as search-based ads accounted for 45%.

One reason Yahoo lost the search wars to Google, (and now Yahoo relies on Microsoft’s Bing search-engine), is because, since its inception, its executives saw Yahoo as a front-end company. They thought of it as a consumer-friendly user interface for the web, while imagining that search engines were at the back end; much like the way in which Intel provides chips for laptop computers. Yahoo, they thought, could buy the services of search engine specialists while focusing on creating front-end products, such as email applications and financial news sites. In this sense, like a television network with programs, Yahoo was a media company with products. This led to a lack of focus, with a suite of products ranging across entertainment, finance, news, celebrities and games. Yahoo was in effect a “mini Internet,” which made sense in 1999 when a user, “could open Netscape Navigator and use the Internet all day and never leave Yahoo and never want to.”

Reporting on a meeting of Yahoo employees, one author describes how a facilitator asked group members the first word that occurred to them when they thought of a particular company’s name. “He said, ‘PayPal.’ People wrote down ‘payments.’ He said, ‘Google.’ People wroteTop of FormBottom of Form down ‘search.’ He said, ‘eBay’ and they wrote down ‘auctions.’ After a few more companies, he said ‘Yahoo.’ He collected thirty pieces of paper on Yahoo. Everyone had a different word. What was Yahoo trying to do? No one inside the company knew.”

Many analysts have complained that Marissa Mayer, who was a successful executive at Google, has not answered this question. Instead, in trying to turn Yahoo around she has “opted for tiny bolt-ons” of new products to the Yahoo site, without clarifying its singular raison d'être. For example, she developed a suite of 15 online magazines devoted to topics like food, autos, real estate, travel and technology that she is just now shutting down. In her first year she acquired 20 startups, some quite small. In March of 2013 she acquired Summly, a news-reading app for $30 million, and in August of 2015 she acquired Polyvore, a visual search engine for fashion for $200 million. Her biggest acquisition at $1.1 billion was for Tumblr, a micro-blogging site. But at the time of its acquisition Tumblr had 100 million users, but only $10 to $15 million of revenue.

In a trenchant critique, a columnist for the New York Times, Farhad Manjoo, argues that Mayer failed because she could not “bet the farm,” that is, make a big bet decision on the future of the company. As he writes, “Three years ago, when Ms. Mayer first took over, she sparked excitement about the future of a company that had, by then, put everyone to sleep. Finally, Yahoo was getting an executive who seemed to understand the web, who was infectiously excited about the possibilities of new technologies, and who had a pretty good track record of ushering in new things.” Yet, as he notes, “Over all, Yahoo remains much the same business it was three years ago. She appears to be building a better Yahoo — with debatable results.”

Manjoo speculates, that had Marissa been ready to make a big bet, one that would bring new focus to Yahoo’s identity, and give it a plausible trajectory, she might for example, have “ditched the web portal and plunged into television” by purchasing Netflix. “The timing was perfect: In 2012, a visionary might have guessed that cable bundles would soon be on the wane, that people would increasingly favor on-demand entertainment, and that there was an appetite for new business models in an aging part of the media. At the time, the stock market doubted Netflix’s streaming future, and the company’s shares were less than a tenth of their current price — in the ballpark of what Yahoo would have been able to afford.” He goes on to note that, “In the time Mayer was at the helm,” Pinterest, a site festooned with web images that users identify and “pin,” has established a “new kind of online commerce,” Facebook invested in the messaging app, “what’s app,” and Vine created a popular site for six-second user-generated videos.

Manjoo’s argument, while not definitive is nonetheless suggestive. Mayer, according to this line of thinking, was not in touch with the currents of popular taste that have shaped what people wanted from their online experience. Indeed, Mayer’s frame of reference, as she has repeatedly emphasized in many talks, has been on the infrastructure of the web; that is, the way in which mobile, video, native advertising and social networks, are changing how content is carried. She has focused on the medium not the message; perhaps a perspective she finds more comfortable as a software coder and a web engineer.
Manjoo’s critique raises the question of when CEOs will make big bets. One hypothesis is that CEOs are more likely to do so when facing crises. For example, when Lou Gerstner became the CEO of IBM in 1993, IBM faced the prospect of selling assets to improve its cash flow. Many in the company believed that in fact IBM should break up so that its constituent divisions--mainframe, storage devices, operating systems and databases-- could compete more effectively in their own submarkets. This concept was consistent with an industry narrative that an integrated computer-system provider like IBM was becoming obsolete.

Gerstner, in a gutsy move, argued against the narrative, insisting that big corporate customers needed an integrator who could pull all of these pieces together. He posited that IBM’s Mainframe, the 390, was the machine to integrate and harmonize all the products in its customers’ IT ecosystems. He then cut the price of the 390 drastically, actually accentuating the cash crisis, which in turn required that he fire thousands of employees.  But his big bet paid off. The price of a unit of mainframe processing fell 96% while mainframe shipments increased twelve times between 1994 and 2001.

Gerstner not only responded to a crisis by cutting prices. He in fact exacerbated it. This put enormous pressure on the company to sell many more mainframes. As a result, the company’s executives had the “freedom of no choice.” This link between crisis and big bets is why startups are the source of so many innovations, and why of course so many fail. By definition, they are big bets and are in state of permanent crisis, racing for results as their funding diminishes. 

But despite Yahoo’s protracted difficulties --revenue had been stagnant since 2011 -- Mayer paradoxically faced the opposite of a crisis. She took up the CEO role under the protective umbrella of the company’s big ownership stake in Alibaba, China’ biggest Internet supermarket, its own Amazon and then some.  Before Alibaba went public in 2014, the only way investors could go long on it was to invest in Yahoo. Anticipating an eventual Alibaba IPO, investors bid up Yahoo’s stock price so that it rose from a starting point of $15 just before Mayer assumed office, to $39 dollars, two weeks before the IPO itself.  After going public, Alibaba was valued at some $25 billion. Yahoo sold 140 million of its shares in the company, earning a windfall profit of $9.4 billion, while retaining 383 million shares, which at $87 a share, were worth $33 billion two weeks after the IPO. To keep this in perspective, Yahoo’s operating earnings in 2014, before subtracting interest and taxes, and excluding unusual expenses, was $220 million. The Alibaba “umbrella” was extraordinary. It enabled Mayer to take act judiciously, and proceed cautiously when acquiring a series of ventures and startups. As sensible as this may have seemed, this strategy never compelled Mayer or her team to address the underlying issue of identity and purpose.

I think Mayer was hobbled in another way. She tended to focus on processes rather than ideas. Abraham Zaleznik, the psychoanalytically informed organization theorist who taught at the Harvard Business School, argued that executives with a managerial rather than a leadership orientation, emphasized business processes --how to use and improve them --while neglecting the underlying ideas that animate these processes and make them meaningful. 

For example, Mayer describes with considerable pride in a video interview how in her first year she implemented a program for eliminating bureaucratic “jams” that people believed were obstructing work.  An employee would describe a jam and “people would go online and use a moderator tool to vote the jam up or down,” as an issue worth addressing.  As a result, the company eliminated the parking gate in the parking lot, the need to use an employee badge to get into the gym, and improved the product shipping process. As she notes, “We changed a thousand things in the first year of using the system. It really empowered us.”

Executives who focus on process are often attracted to the idea that a good leader is what management theorists call a “servant-leader.” In this way of thinking, a leader’s primary task is to eliminate the organizational obstacles that prevent employees from making the best of use of their talents. There is, in this conception, the idea that organization actually interferes with productivity, it is really just bureaucracy, and without a formal organization people would spontaneously coordinate their work to great effect.

Similarly, as she reports, when she first joined the company, employees would ask her, “When are you going to have your big strategy rollout-- your meeting for a grand vision for Yahoo.” She replied, “I am not going to have a big dog and pony show. I am going to the cafeteria and listen because you people have been here for a lot longer. You know what has worked or not.  Maybe we will have a strategy meeting sometime this fall and I will need your help in shaping our strategy.” She adds, “That was a more comfortable way for people to accept me and I view that my role is to listen and get things out of the way.”

I think one aspect of the servant-leader idea that attracted Mayer, was its fit with her concept of a company as a culture. “Culture,” she says in a video interview, “Is something that is hard to change.” Likening culture to the DNA of a company, she says that you can’t inject new genes into DNA, but rather you can facilitate the expression of its good genes. The question was, “how do you turn these genes on, how do you ‘hyper-express’ them.” Stepping into the role of CEO, she said that it was important, “that we not try to change Yahoo into something else. It is a great company. We have great assets. How do we make it the best version of itself?”

This stance is sympathetic and reflects a welcomed humility. But her phrase “that was a more comfortable way for people to accept me,” may also mask a certain discomfort with aggression, and a wish to be part of the group rather than its leader. Mayer put great store in her hanging out in the cafeteria when she first joined the company She notes that when people would talk to her in the cafeteria they would ask her at some point, “is it time to go?” and she would reply, “ No, No, please don’t go, please give me a chance.” As she herself has noted, she is very shy.

This penchant for process is revealing in another way. Like many leaders in the technology industry, Mayer focused on cultivating, supporting and evaluating talent. For example, early in her tenure, she gave the employees free meals and smartphones, “To increase the employees’ energy and output and change the culture of the company.” Of course, companies in Silicon Valley have no choice but to create good working conditions for talented engineers, coders, product designers and marketers. Processes for ensuring these conditions, are necessary though not sufficient for success.

However, what is peculiar in this regard is that Mayer put great store in an employee evaluation system, called the “Quarterly Performance Review (QPR) through which managers force-ranked their employees on a scale of 1 to 5. It proved unpopular and divisive. As one author writes, “Even on top-performing teams, someone always had to get a poor score. Poor and sometimes even average scores made it nearly impossible to transfer jobs, earn full bonuses, or get promotions. The system made employees feels like they were working against each other, not with each other.”

Observers were puzzled that Mayer, who put such great store in employee morale and elevated the role of teamwork, would introduce such a divisive system. One hypothesis is that she embraced this system, despite opposition, because it distanced her securely from the work of re-assessing Yahoo’s basic business idea, what Peter Drucker once called a executive’s “theory of the business.” This work provoked too much anxiety.

Look at it this way. A leader focused on ideas would select people whose talents were joined closely to the products and services the company wished to develop. For example, had Mayer decided that Yahoo had little future as an internet portal -- Facebook and Google had “won” the race, --but could compete in the media/entertainment business, she would have laid-off thousands of employees and hired people whose experiences, interests and talents were focused on the internet as an entertainment vehicle. Absent such an idea, and understandably pressed by her investors to control expenses—after all revenue was not growing- she relied on a mechanical process that severed the link between the company’s purpose and its employees’ talents.

In psychodynamic terms, we could hypothesize that Mayer and her top team faced two chronic sources of anxiety. First, the prospect that Google and Facebook had in fact won the portal/platform war, a conclusion warranted by the results of Mayer’s tenure to date. Second, that to shape a new corporate identity they had to make a big bet. The QPR system helped them stave off their anxiety from both of these sources, while paradoxically displacing it onto the supervisors and employees who then had to struggle with the QPR’s divisive and emotionally difficult consequences. Anxiety is like the “hot potato” thrown from one group of people to another.

To be sure, I would be exaggerating if I said that Mayer was only interested in process. After all, she was a computer engineer by training, she could write computer code, and while at Google, she helped develop the clean look of its search page and its Gmail app. She learned to use data and experiments to determine what features of a web page were attractive, and how to design web pages to simplify users’ navigation between them. When she first arrived at Yahoo she set up her office computer so that she could write code with it. Instead of meeting with employees quarterly to discuss financial results, she led a monthly product review meeting.

But I think her focus on products such as email, an online magazine, or the photo-sharing site Flickr, focused her attention at the wrong level of analysis. It is like the distinction between a course and a curriculum. Any course can be evaluated on its own terms as a vehicle for pedagogy and learning, but ultimately the course gains meaning only in relationship to the curriculum of which it is a part. Planning a curriculum is a more far-reaching activity than planning a course. In Elliot Jaques’ terms, it provokes consideration of a longer “time horizon, ” the sine-qua-non of executive level functioning.  This suggests that she had to evaluate Yahoo’s products in relationship to a larger conception of the web as an evolving sociocultural system.

Let me suggest here that Mayer may have been limited by her training and socialization as an engineer.  She graduated from Stanford University with a specialization in artificial intelligence and “for her undergraduate thesis, she built travel-recommendation software that advised users in natural-sounding human language.” Upon joining Google in its earlier years, she learned the discipline of using data to improve websites. As she recounts in a video, while trying to improve the user interface of an application, a mentor told her, “What we do not need now is more opinions, we need data.”

One question is, does this data orientation exact a price?  Consider the following. A lead designer at Google, Doug Bowman, quit the company because he was exasperated by the misplaced use of data. In a farewell blog post, he wrote, “A team at Google couldn’t decide between two blues, so they’re testing 41 shades between each blue to see which one performs better. I had a recent debate over whether a border should be 3, 4, or 5 pixels wide, and was asked to prove my case. I can’t operate in an environment like that. I’ve grown tired of debating such minuscule design decisions. There are more exciting design problems in this world to tackle.” In other words, the quantitative approach to design narrows the scope of problems that trigger design thinking. It is like the famous “law of the instrument,” expressed in Abraham Maslow’s felicitous comment, “I suppose it is tempting, if the only tool you have is a hammer, to treat everything as if it were a nail.”

In addition, Mayer proposed two formative ideas for thinking about Yahoo’s purpose.  First, she identified the typical user’s four “daily habits;” ‘news reading,’ ‘checking weather,’ ‘checking email,’ and ‘photo-sharing,’ and argued that Yahoo should create the best applications for each. Second, she said that a web portal such as Yahoo should focus on four channels of communication -- Mobile, Video, Native Advertising and Social network, or the “MaVeNS.”

Let me suggest these conceptions together-- habits and channels-- characterize Yahoo as an information utility, a kind of infrastructure for supporting internet use that in the main operates in the background as an enabler, rather than as an agent with a purpose. Her thinking lacks an imaginative conception of the web as a repository of experiences, fantasies, anxieties and emotional connections.

Let me describe two experiences I have had that may illuminate this point of view. I learned how to become and then direct an Avatar of myself on a virtual reality website called, “Second Life.” In one session with several colleagues, we all “took to the air” and flew over the landscape of our virtual world. I felt a certain joy in this process, a sense of freedom, as well as a connection to my peers, even as I understood that it was completely contrived.

Now I have also had, like many other people, repeated dreams of flying -- they are very common—in which I try to convince my friends that if they simply let the wind flow beneath their chests they would be lifted up; that it is really that simple!  Freud, in his inimitable way, argued that such flying dreams were bodily representations of the erect penis or clitoris. If we resist this kind of focus on the body – a hallmark of psychoanalytic thinking and its basis in what 19th century philosophers called “scientific materialism,”  – we can still certainly say, as Freud is suggesting, that flying in dreams expresses a certain potency and reach beyond the constraints and boundaries of the physical world.  So the virtual reality website, Second Lifemade my dreams come true,” but of course only virtually true. One central feature of the emotional web then is just this permeable boundary between reality and fantasy. Of course, products of art --novels, painting, films – move along this boundary as well. After all, we really cry at a movie’s happy ending. But the emotional web has accentuated this boundary’s permeability and intensified our experiences of crossing it.

I also recently saw the film “Stutterer,” which is an Oscar nominee for the best live-action short of 2016.  The hero has a severe stutter, so much so that when strangers on the street address him, for example they ask him for directions, he feigns deafness. It is simply too painful for him to try to speak. Yet the movie voices his inner thoughts at those moments, making clear to the viewer that this young man is articulate and intelligent. We learn at the movie’s beginning that he is engaged in a lively chatting relationship with a woman on the web. He sees her picture next to her chat messages. At long last she asks that they meet at the time of her planned visit to London. Of course he is terrified.  But after several days of delay, he musters the courage to arrange to meet her at a restaurant of her choosing. I won’t give away the punch line, except to say that something about her abilities/disabilities complements his. They are a “match made in heaven.” This film is a fantasy about how the freedom that virtual reality provides, by releasing us from our bodies, which is after all the ultimate boundary, brings us love in the real world.*

One hypothesis is that insofar as Mayer inhabited the engineering worldview, she was doomed to thinking of the web as infrastructure and Yahoo as a portal.  This is a one- dimensional conception, and with it Mayer was competing/boxing with “one hand tied behind her back.” Of course Google was built upon this worldview as well, but it turns out that there is room for only one Google. She needs a new narrative of the web in which design is linked to the permeable boundary between fantasy and reality. The question is; could this point of view lead her to some creative business ideas?

*For readers attuned to the cultural revolution of the sixties, we can recognize in these vignettes expressions of what observers at the time called “a new sensibility.” As one author writes, describing that period,  “Performers of the Living Theater, tried to draw the audience into the play or take the performance into the audience. Such forms of involvement at first included actors, still in role, mingling with the audience during intermission; within the decade, cast members would encourage audience members to frolic with them in sexual acts.” The arts, as Mcluhan argued, are our culture’s “early warning system.” In this sense we can say that the artistic impulses of the sixties, their excess, their obliteration of the difference between low and high culture, their attack on boundaries, anticipated the emotional web.

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