Is High Tech Imploding?

It’s not just the sky that’s falling. Morale at Facebook is falling too. Employees of the tech giant are becoming increasingly discontented. After all, the company stock price has dropped some 35% this year. For those whose compensation is linked to stock price-- through options-- this is not good news.

And yet, the company’s lead officers have chosen to take political positions, largely in matters they do not understand. They have become leaders of the hard left, and the hard left is not interested in corporate profitability. Given its new passion for ideological conformity, the company recently tossed out a senior executive for a thought crime: supporting Donald Trump.

You know and I know that this is not going to end well. It’s what happens when the peanut gallery is given control of a larger corporation. Or better, as I suggested previously, it’s what happens when the masters of the universe of data and social media believe that they are also masters of the marketplace of ideas.

In today’s Wall Street Journal, Holman Jenkins explains what is happening at Google… as a result of the increasing politicization of the business.

First, as has often been noticed, Google made a serious mistake when it succumbed to leftist employees and canceled a deal to work with the Pentagon:

A more telling loss of control was Google’s surrender to mau-mauing employees when it walked away from a Pentagon deal to develop algorithms to speed the extraction of meaningful information from hours of mostly useless drone footage, as well as a chance to participate in a 10-year project to build out the military’s cloud infrastructure.

The next time its executives appear before Congress, it will not be a happy day.

Second, ideological zealots are up in arms against company hiring practices, because merit counts more than diversity. Jenkins does not know which side of the argument is prevailing, but clearly, introducing diversity politics into a meritocratic system will undermine it. It has happened in higher education. Why hasn’t Google rejected this course?

Jenkins is too kind, here:

Google and other companies present themselves as basically hiring IQ, so we’ll idly wonder if today’s troubles are a fruit of that policy or a fruit of abandoning it. The new activists now claim linkage to a “growing movement, not just in tech, but across the country, including teachers, fast-food workers and others who are using their strength in numbers to make real change.”

Real change means more diversity. More diversity will undoubtedly undermine the corporate culture and fill its ranks with zealots. And with people who are not up to the job.

The current crop of zealots, the ones who led a mass walk-out protest in favor of #MeToo, has aligned itself with a Marxist critique of company policy:

They want politics to be in control of business. That includes deciding which products and services will be developed. According to San Francisco’s KQED, the activist group is reluctant even to name its “founders” due to the word’s “negative associations with what they call the capitalist-driven ethos that has become pervasive in Silicon Valley.”

Jenkins concludes:

One of the Google employee demands is representation on the company board—also a feature of Elizabeth Warren’s proto-presidential platform....

Of particular and immediate menace to Google’s top leadership is a sexual neo-Puritanism in the workplace that appears to be highly instrumental—i.e., adopted mainly as a broom to sweep middle-aged white men out of the company.

The other word for this is: a coup against the management and leadership. Or better, it is self-deconstruction. After all, the more Facebook has become politicized, the more its stock price is dropping. Why is Google emulating that example?

As I have said elsewhere, it is a fundamental error for management to take sides in political debates. These companies look like they are heading for a crash. Will they be hoist on their own petard?