TechCrunch interview: ‘Palo Alto’ author Malcolm Harris

Most of the tenets that helped capitalism take root and thrive in California two centuries ago are still in place today. The Golden State didn’t invent venture capital, incubators for young talent or higher education partnerships, but just like chardonnay and cannabis, these are concepts we improved upon and commodified for export.

It’d be simplistic to describe author and critic Malcolm Harris as a contrarian. In previous books, he punched holes in the stereotype that millennials are coddled crybabies (“Kids These Days: Human Capital and the Making of Millennials”) and demanded that we reexamine our assumptions about American exceptionalism (“Shit Is Fucked Up and Bullshit: History Since the End of History”).

In his latest book, “Palo Alto: A History of California, Capitalism, and the World,” Harris spends 628 pages presenting what he describes as “the standard materialist understanding of Northern California history,” which begins with genocide against indigenous people. In the final pages, we learn that some of the ancient burial grounds of the Muwekma Ohlone are today adjacent to “one of the highest concentrations of capital of any kind in world history.”

I spoke to Harris last week and opened the interview with a confession: I didn’t finish his book in time for our chat.

“Best of luck,” he replied. “I don’t take it personally. It’s a long book.”

This interview has been edited for space and clarity.

TC: Was there an inciting incident that made you want to write this expansive “history of California, capitalism and the world”? Or has this been brewing for a long time?

MH: For writers in my cohort, there’s a trade-off: You can write about the worst thing that ever happened in the place where you grew up, interweave it with history, and maybe that’s your best shot at a good book. That’s sort of originally how I sold it, and luckily — for everyone, myself included — that’s not the book I ended up writing.

You grew up in Santa Cruz, but you attended Palo Alto High School.

I was born in Santa Cruz. But I grew up from 8-18 in Palo Alto.

That’s a crunchy college town on the coast, but it’s also a bit of a bedroom community for some people in Silicon Valley. What was your sense of the tech industry growing up there in the ’90s?

We were still in the PC boom, so there were people around town who had a lot of money and it was never clear where that money came from.

It had something to do with the tech industry, like, “Fred’s dad invented the case on the Palm Pilot, so they have a big house.” That’s what the tech industry was to me, more or less. And my dad sort of worked adjacent to it as an IP lawyer. He’d grown up with computers and been a hacker in the ’80s and ended up doing computer law.

He was part of that world, but I didn’t connect the two even though most of his practice was tech stuff. So I didn’t really have a strong grasp of it. Even when I was in high school, and Facebook was starting, it wasn’t central to me. I was really interested in politics, and tech didn’t seem very aligned. I didn’t see the relationship between them, which reflected my child’s view of the world at the time.

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A hundred years from now, how do you think these men will be remembered or spoken about?

Oh, that’s a good question. I hope not too much.

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Culturally, when did tech start sucking up so much oxygen?

I feel like some of it’s been since I wrote this book, even just since 2020. Not just culturally, but economically, it’s sucked up so much more oxygen, as you say. It’s hard to think back even just a few years ago when tech people were not on the front page of every newspaper every day in America, but also, a lot of it happened after I left town.

I graduated high school in 2007. Facebook was just starting the social media boom, but that hadn’t really exploded yet, so it wasn’t an aspirational lifestyle for young people.

When I started reading your book, I thought of Herbert Hoover as the one-term president who ushered in the Great Depression. As it turns out, he was one of the most influential Americans of the 20th century. How would you describe his legacy? He’s more pivotal as far as shaping the way we live today than FDR in many ways.

In this conflict between those two men, we’re taught that FDR beats Hoover and that FDR shapes the 20th century of America. I don’t think that ends up being true. Hoover outlives him, not just chronologically, but politically — he dies in 1964. At that point, you’ve got multiple presidents who have asked Hoover back into the government.

I did not set out to write dozens of pages about Herbert Hoover, I knew he was an important son of Palo Alto. But I didn’t know he was one of the most important people of the 20th century. Not just in America, but in the world.

You wrote, “Capital by its nature dominates labor. And if it fails to accomplish that, it ceases to exist.” You talk a lot about organized labor in the book. It’s an essential aspect of California’s agricultural and industrial economy. But the tech workforce is not unionized in any meaningful sense. Why do you think that is?

[Labor] organizers have found tech to be a hard place to organize. One story that really illustrates that is Xerox’s investment in Apple Computer.

The famous story is that Xerox PARC researchers showed their whole setup to Apple’s tech people, who took it and ran, and Xerox wasn’t there with them and sort of missed the opportunity. My revisionist history is that the reason Xerox was doing that technology exchange in the first place is because they had invested $100,000 for a stake of Apple. Not because Apple had the best technologists . . . [but] because Apple was the best manufacturer. And the reason why Apple was the best manufacturer wasn’t because it was like they had figured out some superior process; it’s because they figured out a new labor bargain, which is that they had immigrant housewives in kitchens throughout the Bay Area assembling their boards.

And Xerox was looking to them as a potential contract manufacturer for Xerox’s personal computer, and that’s why they wanted to invest in Apple. What those firms really offered was not a technological or manufacturing edge. What they were flexible on was what they were paying the manufacturing workers. And that allowed production to shift toward these firms and toward the west, which is not unionized and not organized. Offshoring starts in the chip industry in 1961. So that history is real deep.

To work in a startup, you have to distort reality to believe that success is not just possible, but also likely. I think it makes the idea of joining a union counterintuitive, like, “Why do I need union protection when I’m on track to becoming a millionaire?”

You start thinking that you are a capitalist, because in some of those industries, the pay in terms of stock options is such a high percentage of that potential compensation, even if it might be a long shot. But the history of that is that same history, which is when HP introduced employee stock options in the first place. It wasn’t really because they wanted employee buy-in. And it definitely wasn’t because they were a startup and they couldn’t afford people.

For them, it was a good way to get nondiluting capital into the business. Because you’re recovering your own labor costs and getting your workers to loan their pay back to you when they’re exercising options or buying options.

I have no problem asking investors to help solve business-related problems, but it seems like a lot of prominent ones are autodidact polymaths on everything from public health to tank warfare in Ukraine. Did successful businesspeople always present themselves as domain experts, or is this a more recent phenomenon driven by social media?

No, no, it’s definitely a long-running phenomenon. Leland Stanford is a great example: a real goofy guy, who in addition to being a sort of frontman for this capitalist syndicate that was ripping off the government, was also the governor of the state.

In addition to considering himself an expert in horses, an expert in social arrangement, an expert in immigration, he was a self-declared expert in many, many things and had the capital to sort of prove it or demonstrate it in some of them. So he’s a great analog for people of today.

Herbert Hoover’s another one. He goes from being a mining engineer to being a political leader pretty directly through being a self-promotional rich guy. David Packard was a deputy secretary of defense under Nixon. In military-industrial terms, you could argue that someone like Musk is playing a bigger role than that today.

There’s little scientific rigor backing up the current cohort of great men. It’s just wealth.

You saw a transition during the PC era, where you had Steve Jobs and the rise of suburban boy wonders who no longer had to be selected by the military or higher education. In the case of Bill Gates and Steve Jobs, both of them dropped out of college. Bill Gates gets to spend more time on mainframe computers than almost any other kid in the country, and it’s because he goes to this private school that has access to computers. He trains himself pretty well and does a good job.

You have this sort of “Revenge of the Nerds” moment in the ’80s and ’90s, where they say, “We’re smart we don’t need the university’s approval, we don’t need anyone’s approval. I can wear a T-shirt and drip Hot Pockets on it. I don’t need to wear a suit and have gone to Columbia for my PhD in chemistry.”

I still see a lot of investors and founders performing this behavior.

The more you can display this sort of anti-systemic verve, the smarter you seem to look, except now we see the sort of degeneration where you no longer have to even have the self-trained technical expertise.

Elon Musk, I haven’t even researched that much, because I don’t even think he’s that interesting. But Sam Altman dropped out of Stanford when he was a sophomore because he thought that dropping out of Stanford as a sophomore sounded good for his first tech company. No one says that this guy is a top-level programmer who has invented anything except for a Foursquare competitor that got squashed. Otherwise, he’s been doling out other people’s money and some money that they let him use for a while despite him not doing anything successfully.

But now he is one of those guys, right? He’s one of the top 20 tech oligarchs at this point in history, which is ridiculous. Whenever his face appears in anything, he’s got this look of a guy who told the king he’s going to turn the straw into gold by tomorrow. He doesn’t know how he’s gonna do it. He’s sitting at home hitting the Rumpelstiltskin button trying to figure out how he’s gonna get Microsoft their money back.

To me, the reason why Elon Musk is not interesting is because he’s so fantastically wealthy. There’s no drama because there’s no chance of failure, which Silicon Valley defines as running out of money.

The characteristic that they’re looking for is that willingness and eagerness to take risks, because that’s what the economy needs. The economy doesn’t need sound investment that’s going to return 5% or whatever. If they wanted to do that, they could build solar panels, right? We need something that offers real growth potential for this money, that can absorb hundreds of billions of dollars. The real challenge is coming up with some kind of story that can absorb that much capital. Because they don’t have anywhere to put it.

They’ve got to offer something that’s going to offer unbelievable returns. And who can do that? A con man, you know, that’s who can do that. And we saw that definitely with crypto and NFTs, which was sort of that to the nth degree. We saw that with the metaverse, which is the same thing: a whole industry just based on the idea of hyping things. I think it’s more or less the same thing with what I hesitate to call “AI” or generative software that I think ultimately people are going to realize doesn’t do anything, doesn’t make anything. And it’s possible that its uses are actually way, way, way more constrained than people are imagining.

That sounds like every hype cycle I’ve ever lived through.

It’s been pretty amazing that since this book has come out, we’ve gone through like three of these: the speed is clearly increasing. When I published, the first thing people said was, “Oh, don’t you wish you wrote about cryptocurrency?” And I was like, “No, I don’t think it’s gonna last — I don’t think that’s going to keep my book on the shelf.”

Now people don’t even remember to ask that.

You wrote, “It’s often said that under capitalism, relations between people appear as relations between things.” With that as subtext, what do you make of the on-again, off-again cage match between Elon Musk and Mark Zuckerberg?

Yeah, it’s pretty funny to see these guys who stand for these companies try to fight each other in a literal sense. I think Elon Musk talks a lot of shit and that’s part of the story, right? I do think it’s interesting how tech guys have gotten interested in this Ultimate Fighting stuff.

Hyper-masculinity, I would even say.

It’s part of their interest in fitness and eugenics. Fitness, with a capital F, not like feeling well, but evolutionary fitness and proving not just that they are smart, but that they are superior individuals. And that goes way back to the beginning of Stanford and David Starr Jordan, its first president, saying, “We need to substitute football for war, because we don’t want them to actually die. But we still need to see who the best ones are.”

I saw an episode of the show “Friends” where Jon Favreau is playing a tech millionaire who decides that he is going to become the ultimate fighting champion. He gets his ass totally beat. But at the same time, it gets into that psychology perfectly where he’s like, “I’ve dominated business. Now I want to dominate the combat realm!” It’s still very much a joke, but now it’s actually happening in real life.

Black founders received 1% of all venture capital last year and women-founded startups raised 1.9% of the total. We’ve been bemoaning the lack of representation in tech for decades: Can this system be reformed?

I don’t think so. Even if you were able to reform the personnel, they’d still be running the same system, and it’s a system that’s based on increasing labor exploitation.

We know that all people have an equally distributed chance of aptitude for everything because humans are one species. Which means there’s like a big growth opportunity there for investing in women-led startups in theory, right? You look at that number, and you say, “Their irrational sexism is causing them not to invest in these firms; I should invest in them. Let me fix this in terms of market efficiency.”

People have been making that argument for a long time now. And to see that it hasn’t happened, I think suggests that story isn’t true and that there is something about capitalism that is based on this kind of cartel action that is about intentionally limiting the range of opportunities that are allowed to people [who are] outside certain circles.

The racial and sexual division of labor in tech is foundational to its existence. And I don’t think a personnel change is going to fix that.

Unlike 19th-century industrialists, tech entrepreneurs don’t seem as interested in building parks or libraries or hospitals. Am I being ungenerous? I don’t sense that there’s a philanthropic drive underpinning what they’re doing.

I think they would say that there is. Zuckerberg can say, “Well, I got a hospital. What about my hospital?”

I live in San Francisco. Everyone still calls it “General,” and no one calls it “Zuckerberg.”

As they should. I think they would say that they are more efficient. We can see that in the effective altruism movement, where they say, “I don’t want to just give money or books to the people. I want to solve problems. And the way I solve problems is I fund my foundation. And my foundation does quantitative analysis of what things will really solve problems, and I’m gonna put my money into those things, it’ll solve problems, and you’ll never hear about it. I’m making a better world and you don’t know about it. In fact, you’re too stupid to understand.”

That’s how they’re running their philanthropy now, because that’s how they think about the world. They could give a damn about people’s access to books. If they really cared about something like that, they would have supported the Internet Archive in their legal battle, and we would have a lot more access to books now than we do, which is very unfortunate.

From my perspective as sort of justifying their own existence through philanthropy, they’ve been lying down on the job. But from their perspective, they’re more philanthropic than ever; they’re just doing it efficiently. And I think that is another demonstration of how they look at the rest of us.

A hundred years from now, how do you think these men will be remembered or spoken about?

Oh, that’s a good question. I hope not too much.

I feel like if we know Elon Musk’s name in a hundred years, that’s a very, very bad sign. I hope we’ll be able to talk about them as an impersonal mass in the way that they talk about workers now and we won’t feel the need to even think of them as individual characters, because we can understand them as a malignant social force that used to exist. We’ll be better off for it.

And certainly their names won’t be on any buildings, I hope.