Metanomics Transcript Jan 27 2010

METANOMICS:
DOUGLAS RUSHKOFF OF FRONTLINE'S DIGITAL NATION
JANUARY 27, 2010

ANNOUNCER: Metanomics is brought to you by Remedy Communications and Dusan Writer's
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ROBERT BLOOMFIELD: Hi. I'm Robert Bloomfield, professor at Cornell University's Johnson Graduate
School of Management. Today we continue exploring Virtual Worlds in the larger sphere of social media,
culture, enterprise and policy. Naturally, our discussion about Virtual Worlds takes place in a Virtual
World. So join us. This is Metanomics.

ANNOUNCER: Metanomics is filmed today in front of a live audience at our studios in Second Life. We
are pleased to broadcast weekly to our event partners and to welcome discussion. We use ChatBridge
technology to allow viewers to comment during the show. Metanomics is sponsored by the Johnson
Graduate School of Management at Cornell University and Immersive Workspaces. Welcome. This is
Metanomics.

ROBERT BLOOMFIELD: Welcome to the 2010 season opener of Metanomics. Our guest today is
Douglas Rushkoff, a correspondent and writer of PBS Frontline's upcoming documentary Digital Nation, a
long-time observer of technological trends, especially in the digital age, and author of many books
including the very timely Life Incorporated: How the World Became a Corporation and How to Take It
Back. Douglas, welcome to Metanomics.

DOUGLAS RUSHKOFF: Hi. Good to be with you.

ROBERT BLOOMFIELD: Yeah, it's great to have you on. I only mentioned a few of your various
endeavors. I know one of them also is that you are a tech correspondent for the Daily Beast, and, before
we jump into Digital Nation, I know that just today you wrote a column on the new Apple Tablet. So care
to go on record on a projection of how that'll work out?

DOUGLAS RUSHKOFF: Well, in the long term, I think the way it'll work out is that it's going to undermine
the Macintosh system. I mean the interesting thing to me is how they really are choosing to use the
iPhone system and the iTunes world and the AppStore for pretty much everything they do now, and that's
because it's a nice closed universe compared to the Mac where you could put anything you want on it,
getting it from anywhere. So to me, it's sort of like Apple is playing HBO to Google's free television, where
one world is sort of ad-sponsored, and you get everything you want, and the other world you pay for, but
you've got to stay inside the walled garden. So I'll be interested to see just how high up on the chain this
iPhone and iPhone-like operating systems go and whether someday the iPhone App or the iPhone OS
might do to the Macintosh what the Macintosh did to the Apple II.

ROBERT BLOOMFIELD: Interesting. Interesting. So we'll probably come back to this topic later, as we
talk about businesses, corporations and brands. But before we dig into that, let's talk about the upcoming
airing of Digital Nation and get the plug in first. It airs on PBS Tuesday, February 2nd at 9:00 P.M. and, of
course, we're delighted to have you on not only our opening show of the season, but also really the last
opportunity to hear from you before the show airs.

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I'd like to start by asking you about what really seems to be a fairly experimental aspect of Digital Nation,
which is that it's not just a television documentary, but it's integrated with a website that has been up long
before the show airs, and I understand you're going to keep it up after as well. So can you talk about how
you use the website and integrated that with a traditional documentary?

DOUGLAS RUSHKOFF: Yeah. Well, I guess it's an innovator for PBS, you know, movies with websites
developing alongside them, as long as there's been a web. But, yeah, for PBS or for Frontline, for one of
these more traditional publishers, it's certainly a new thing. I mean what we did was really over the last
two years we've been shooting all over the place, whether in New York or Korea or San Francisco. We
always shoot hundreds of hours more on a documentary than you could stick in the movie. And what
we've been doing is assembling not really the rushes but really extended pieces about whatever we're
working on.

So when we went and we saw Philip Rosedale at Second Life, we shot the offices and extended
interviews with him and a whole bunch of different stuff. So then we ended up putting sort of a piece
together on VR or Second Life simulations and then have people comment and then have people from
the public making their own stories and uploading them to this website and trying to take each month or
so and create a kind of a different inquiry so that we can share sort of the question that we're asking with
the public at the same time that the public can share with us sort of how they look at that question or how
they're answering it. So it led to a lot of really great material for us. We were asking about sort of the
generational differences between the way people approach new media.

And then we end up getting a post, uploaded a video post from this site called Feed Me Bubbe, which is
this great 88-year-old woman or so, who's got a cooking show on the web, and her grandson Avrom. And
it was interesting enough, and then we end up going out to where they live in New England and shooting
this segment with them, both for our site, and it ended up in the show. So on the one hand, it was a great
way to get to make a hundred-hour movie instead of this hour-long or hour and a half-long movie that we
made. On the other hand, it was this nightmare because we just made a hundred hours of film. So it was
a hell of a lot more work than it would have been otherwise. But it was a way to have something that
really had not just a real participation from the audience, in terms of the website, which is something great
in itself, but it created, really, a third character in the movie. It really allowed the public to have a voice in
what it is.

So it's not us telling America, "This is who you are. You are in a digital nation." It was more kind of our
digital nation telling us who they are, feeding us the stories that they wanted to see covered, either about
themselves or about people they knew. We followed some World of Warcraft gamers from their home
where they played it in New York out to we ended up going out to BlizzCon, which is the Warcraft kind of
convention because we were following them, and they were saying, "This is where you get to see the real
gamers. You got to see it." So it was, in some ways, a terrifically passive filmmaking experience when we
let our subjects drag us around and suggest to us and show up on our doorstep in a way that they really
wouldn't if you're doing a traditional film inquiry.

ROBERT BLOOMFIELD: And how about after the show, will this sort of community participation
continue?

DOUGLAS RUSHKOFF: Oh, yeah. There's some community participation in that people will still be able
to upload what we're calling My Stories or Your Stories, videos and things that go to kind of a special
YouTube channel that's on the site. And what I'm going to be doing, and I guess this is going to be the
main thing I do this year now is, I'm going to be hosting a series of monthly roundtables, kind of the
old--remember Harper's Magazine? I don't know if they still do them, those roundtables, where they all
invite like eight really smart people in a particular area and have them discuss a particular issue.

So what I'll be doing is, over the course of a month, I'll be moderating a conversation between some of
the experts or the involved players in a particular question, like "Google and China" or "Is the attention
span getting shorter." I want to do a unit on moral games, this whole idea of games with better teaching
ethical values, something on social networking or kids in media. Each month to have this moderated

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conversation that's going up each day as people are posting to it. And then it would also be a little bit like
the old--remember Feed Magazine, Steven Johnson's website in the early '90s. It would have a threaded
conversation from the public alongside it.

So the idea is that, like on the left or in the center is going to be this one column going down, and then
almost like a Talmudic commentary, people will be able to comment on what the roundtable participants
are saying and even then comment on what other commenters have said about that. So it'll be these sort
of threaded responses to the main roundtable responses. But then the roundtable members will be
reading that and can interact directly with that. So sort of a way to create.

I was thinking what does PBS have that, boing-boing, you're in Gadget or any of the many, many, many
places that are doing great technology coverage, what does PBS have that they don't, if anything. And I
think what they've got is that name PBS. And, with that name PBS, I think we can get people to come to
the table, who might not participate in many other things. PBS still has that sort of solid Bill Moyersee-like
kind of name recognition so that I think we can get a Steve Jobs or someone or a Wozniak, perhaps
better, to come into a conversation that we're having in a way that I probably wouldn't if I was just doing
this on my blog.

ROBERT BLOOMFIELD: That sounds very interesting. So I'd like to ask you a little bit; I don't want you
to give so much away about the show that we all feel we don't have to watch it.

DOUGLAS RUSHKOFF: You don't. The thing is, you don't have to watch it. I'm so over that. What do you
"have" to do when you really "have to" now? What you have to do is TiVo the premier episode of Lost.
Just do that.

ROBERT BLOOMFIELD: And then next year you're going to tell us we don't have to buy your book.

DOUGLAS RUSHKOFF: You don't. Well, you didn't, right? I'm still here.

ROBERT BLOOMFIELD: No, I did. It's on my Kindle.

DOUGLAS RUSHKOFF: Oh, thank you, but you can't take it back. No, I would you to buy my book. But I
mean it's just like the way they make you write books, they want you to title books and frame them in such
a way that it's almost as if your book title is supposed to say, "Your children are dying. Buy this book, or
it's too late." You know what I mean?

ROBERT BLOOMFIELD: Yeah. Well, it's the old, "Buy this magazine, or I shoot this dog." Right?

DOUGLAS RUSHKOFF: I know. It's like come on, just read this because it's going to enrich you. Read
this because it's fun. Things are too serious in our world for people to do things for other than life-or-death
reasons. But, yeah. But, no, I'm happy to share anything. And, if people went to the website, they could
see all sorts of stuff from the show. It's just that what I'm hoping is that the 90 minutes that we created the
way it's cut together, that the experience of it is different than looking at any amount of the footage that
we've already put up there.

ROBERT BLOOMFIELD: So let me ask you, from your personal perspective, you're so familiar with the
digital space. You've been writing books about the computer age and following it for by now we can
actually say decades.

DOUGLAS RUSHKOFF: Twenty-five years. Yeah.

ROBERT BLOOMFIELD: What was the most surprising element of this? Is there something that you
learned, where you said, "Golly, I just had no idea"?

DOUGLAS RUSHKOFF: Yeah. I mean a couple of things. First, I mean, as long as we're in Second Life,
I was surprised to hear Philip Rosedale say that he believes, he truly believes that, within ten years,

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Second Life will be indistinguishable from the Real World. I don't know how many people in Second Life
would agree with that or think that's even that we're close.

ROBERT BLOOMFIELD: I'm guessing it takes about 20 seconds to get the responses in chat, and I'm
guessing we'll get a few of them.

DOUGLAS RUSHKOFF: Yeah. That one kind of shocked me that he would even go there, that he would
even say that. Even if he believed let's say stretch it out to 50 or 60 or 70 years, that even if he believed
that the technology would get really good and high rez and super and duper and all that, that he doesn't
suspect that the human perceptual apparatus will adjust to compensate, that we'll learn how to
distinguish.

So it's like the first day that you hear a stereo playing. If you've never heard a stereo before, you would
think that that's a real rock and roll band in the next room. You wouldn't know. And then once you've
listened to it a while, you realize you can hear the difference between a stereo and a band. So I would
assume that the better Second Life gets the better it will get at distinguishing between these
two--someone's offering friendship. Isn’t that's sweet--the better we would get at distinguishing between it.

The other thing that shocked me, there's a guy named Jeremy Bailenson, out at Stanford, who's got the
Stanford Virtual Research Lab. And basically he uses Second Life to do all sorts of experiments. And one
thing he found out is that, if you meet someone in Second Life and their Second Life avatar is two inches
taller than you, then, if you negotiate with them afterwards, they're going to have a negotiating advantage,
like a three to one negotiating advantage over you, and that's whether you do a negotiation in Second Life
or whether you do it on the phone or email or something like that later, that it persists even after you're in
the virtual space. So that was kind of shocking to me that it would be that much.

And something else he did was something he calls the "swimming with whales experiment," where he
took like five-or six-year-old kids and gave them a sort of VR experience of swimming with whales at Sea
World. And then two weeks later he interviewed the kids, and half or more than half of them said that they
believed they had the real experience. They thought they really went to Sea World and did it. They didn't
realize it was a virtual experience. So those kind of things I guess were the things that surprised me the
most.

ROBERT BLOOMFIELD: For people who want to hear more about Jeremy Bailenson's research, we
actually had, by now, boy, about a year and a half ago, we had his co-author on, Chris Yee, talking about
a number of those studies. The swimming with whales is a new one and actually brings me, you know, it's
a nice lead-in to the next question I had because my guess is that's the type of story that a lot of people
will find frightening or creepy about Virtual Worlds and virtual technology, the blending of the real and the
imagined. And, of course, kids can't tell the difference.
Just a couple minutes ago you were talking about, "Oh, well, when you write a book, the publisher wants
you to put the frightening title on." So I'm wondering, when we see Digital Nation, to what extent is it going
to be one of these "Your children are in danger" shows? Are there stories you personally find worrisome?
Someone is correcting me: Nick Yee, not Chris Yee was on. I knew that was wrong at the time I said it.
Nick Yee was on the show.

DOUGLAS RUSHKOFF: Well, it's tricky. We were just actually having this discussion, me and
Mark Bauerlein and Jeremy Bailenson, beginning the first roundtable in this other space. And both of
them said that they felt a little scared, after the movie. And Jeremy Bailenson actually went through the
movie and timed how much positive stuff that was being said about the net versus how much time was
being spent saying negative things about the net. And he said that they were roughly equal. And then
Mark Bauerlein, who's actually an English professor, who's been looking a lot at whether the internet
makes us dumb or smart. He wrote a book; I think it was called The Dumbest Generation or something, of
course, equally aggravating. And he said that it's that we react to negative information differently. You
kind of remember it.

So if we spend twenty minutes in Korea, looking at pro gamers and all this really fun stuff, and then five

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minutes looking at one tragically addicted video gamer who's going to a special camp to try to get free of
this addiction. And he can't move his hands, and his eyes are all screwed up. Those kinds of images, the
kind of negative ideas sometimes stay with you more. So it's hard that way. And plus, you know it is PBS,
and the whole context of PBS sometimes feels like, oh, concerned parents, that PBS is sort of like TV
that's supposed to be good for you in a world where everything else is bad for you. So there's almost that
expectation.

But, no, the thing that makes it frightening sometimes, I think, is the sense of inevitability. In other words,
we know that this is happening. We know we're becoming more and more digital. We know that going
online is no longer a thing that somebody does; it's a way somebody is. We've gone from logging on to
always on, and it's disconcerting, especially when we really don't have any good research on what this is
doing to us and what it does to our brains, what it does to us socially. When you look back, we don't even
have any research, good research, on what television does to us. It was never really done. We've got
great information, great data on how to influence people with television or the effect of beer commercials
on kids or the effect of particularly violent shows on whether kids get violent afterwards, but
Marshall McLuhan, the great media theorist, said, "Why can't we just do an experiment where people look
at blank screens that are on?" He wanted to know what's the effect of the TV itself, you know, this thing
flashing at 60 hertz, with scan lines: What's the effect of that on the brain? How is that massaging or
changing our neurology? And there's never money for that.

There is money, and that's what we went and looked at, there's money the Military is spending to look at
how to relieve stress that comes up in the pilots who are flying drones over Afghanistan or how to get kids
to join the Army, by playing video games. There's research by companies in how to get people to buy
stuff or in the short-term effects of certain colors or experiences on how much a person will spend. And
the fact is, the places with the big money, the places that are doing the most work are not generally the
places who are just looking for kind of out of an academic or socially beneficial set of priorities; they're
looking either how to make money or how to influence people.

ROBERT BLOOMFIELD: I've been looking at the chat here, and Chimera Lemon I guess first is giving
some pushback on the fact that you are talking with Bauerlein and saying there also--I guess there is
research on some of these issues you've just mentioned. Chimera, if you'd type in, maybe elaborate on
that, that'd be great. And, Douglas, I'm not familiar with Bauerlein. Could you give me maybe just your
take on his overall perspective?

DOUGLAS RUSHKOFF: I mean Bauerlein is sort of more the traditionalist. He's an English teacher, and
he noticed lots of behaviors and abilities that his kids seemed to be lacking. And there has been some
measurement on this, that people's ability to do more contemplative tasks, to do reflection, to do deeper
sustained thinking has been going down. And there is some correlation between the amount of net use or
net exposure someone's had, and this. But, again, you can't necessarily blame the net.

If someone's spending time with Facebook, for example, a lot of time, or growing up with Facebook, that's
not just the net. Facebook is a particular application developed by particular people with particular
interests. Facebook is, it's real goal is to figure out how to monetize human relationships, and it does that
by generally reducing human relationships to their affinities or the products they like or the bands they like
or whatever it might be. I'm not saying this in a negative way or in a judgmental way, just that Facebook is
a particular thing so you can't look at it as if that's the net or that's a piece of technology. This is the effect
of the computer on a kid.

What we're looking at is a much larger ecosystem of interests. So we could say that's the effect of
marketing on a kid, or that's the effect of a company trying to monetize something on a kid. They just
happen to be using the computer to do this. So a part of the reason there's so little research, I mean
there's really only one that we found was one guy who was actually looking at the effects of the computer
on the brain, and that was--what the heck is his name--this guy at--was it [Cliff Mannes?] at UCLA. And
he stuck people in an MRI machine, and he was like, "This is your brain on Google. This is your brain
reading." And what he found was that more areas of the brain lit up when a person was doing a Google
search than when a person was reading a book.

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And then the headlines that came out after that, and talk about negative versus positive, were very
positive that Google makes you smarter. Look. More of your brain is being used. And he kept coming
back and trying to say in every interview, "I didn't say Google makes us smarter. All I'm saying is that the
brain is working harder when you're on Google because you're both reading and you're making decisions
about what to click on and where to go and what to do next. That doesn't mean better. It doesn't mean
worse. It just means different." And it's like it seems to be impossible to discuss these things without
either making value judgments ourselves or hearing value judgments in what people are saying.

I interviewed a kid in the show, and the kid said, and his teacher said, that most of the people--and these
are MIT students--they currently no longer write papers with sustained logic, that the papers they write
tend to be paragraph by paragraph by paragraph. So they write one paragraph, and then the next
paragraph is another great paragraph, but about something completely different so that they no longer
have a connected narrative through all those paragraphs.

Now it's impossible for me to say that without people thinking I'm saying, "Woe is me. Our kids can no
longer write a sustained narrative."

ROBERT BLOOMFIELD: Yeah, kids these days.

DOUGLAS RUSHKOFF: Yet actually, as a writer, I can assure you many times I write articles by writing
a bunch of paragraphs, and then I come back to those paragraphs and construct a narrative thread
through them because I'm obligated, as a writer, to have a narrative thread because that's the convention
that we're following. But not always are those narrative threads organic to the information that I'm sharing
or the ideas that I'm sharing. And quite often those narrative threads are rather arbitrary and are designed
more as a means of sustaining the reader's interest from paragraph to paragraphs than they are of adding
any genuine meaning.

Now I don't mean just to be saying, oh, I'm a bad writer or I'm a fake, but many writers do this because
the narrative line is expected. I'm not saying it's necessarily true, but what if the way these MIT kids are
writing is actually more consonant with some of the ways in which people think about stuff? What if this
sort of impressionistic series of ideas about Emily Brontë's novels flows like a kind of Delusian
construction and has an almost fractal-like cumulative effect on the reader. So not everything is a value
judgment. Some things are just different.

Sure, I pine the fact that I can't help it because I'm old, I guess, that people are losing the ability to
contemplate or losing the time to contemplate. A lot of the kids we talked to at MIT said, "Yeah, well,
someday I'll have time to actually sit back and think, but right now it's all about application. That's what I
do. I want to get a job. I want to do this." That's life, to some extent.

ROBERT BLOOMFIELD: That's fascinating. And I'll say, while you're talking about that, I am, of course,
multitasking and looking at the chat. And Jennette Forager has found some quotes of that study by
Dr. Gary Small, the neuroscientist, and we've got some people elaborating in text on Bauerlein, who, I
see publishes regularly in the Chronicle of Higher Education. So I guess he's of the "kids don't work hard
enough" school apparently.

DOUGLAS RUSHKOFF: Well, he was certainly the biggest "woe is me" we could find, but he did make
some great points. I mean he's one of the guys that's against computers in the classroom, and his belief
is that we are online and connected to these machines and all so much of our day, and kids are being
raised losing certain social abilities and kind of having more Asperger's-like symptoms every day, that
why can't we let school be this sort of refuge from this stuff. Why do we always have to think we've got to
meet kids where they live? Why can't we just let school be a person-to-person live thing just a few hours a
day, where they get to interact with other people? When I hear him talk, I go, "Yeah. That sounds smart."

But then you get Marc Prensky on five minutes later, in the same interview setup actually, and he wrote
this book about digital natives, and he sounds like I did back in '95 when I wrote Playing the Future. Kids

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are different. They're not just short attention span. They're broad attention range. They've got abilities we
don't, and we can't pine the fact that they're losing the ability to read books because they're gaining the
ability to read and make video and do other things. So just watch them and marvel.

ROBERT BLOOMFIELD: Since you've said we'll all remember the big negative stories, what do you see
as like the most hopeful, positive story that you think we ought to remember?

DOUGLAS RUSHKOFF: What, from this movie or in our [files?]?

ROBERT BLOOMFIELD: Oh, actually I was thinking of Digital Nation, but if you've got a better one, go
for it.

DOUGLAS RUSHKOFF: I wasn't thinking so specifically, I guess. I mean the thing that leaves me
positive is that, really, no matter how hard a company, whether it's a technological company, a software
company or a marketing company, no matter how hard they try to make a piece of machinery or a piece
of software about them, about their products, about monetizing, people invariably find a way to be social
on it. That's really the story of the internet. This Defense Department communications technology
becomes a place where scientists are talking about Star Trek and interesting things instead of whatever
they're supposed to be doing, to the point where the Military doesn't want the thing anymore. AT&T didn't
even want it. They offered it to them basically for free. AT&T didn't see a use for it because people were
just having so much fun just engaging with each other.

And what I keep seeing is, you look at World of Warcraft or anything, and you see, by hook or by crook,
people end up using it just to find other people and to express themselves and to try to broaden what it
means to be a human being. So that's, for me, the repeated message that I kept getting in making this
stuff is, it was really when I was looking at the supposedly darkest, "worstest" stuff is where I saw the
human spirit kind of alive. And it seemed to me really indefatigable, if you will, that almost every--I went to
ITP, which is where I teach sometimes. It's part of New York University, the Interactive
Telecommunications Program. And you look at what the next generation, I mean kids in their 20s are
actually making and the software, the devices, the things that they're designing are invariably designed to
reconnect people to the Real World.

There was this one guy--I don't think it ended up in the movie actually--he made a giant map of the world,
and he had this blood bag over it. And, what he would do is time out a decade, and then he would put this
thing that was basically plotting a chart over the map. It would drop like a droplet of blood in each location
where there was violence or a terrorist act or an act of war, and it created this just smear of blood across
this map. Of course, most of it ended up right in the Middle East, and there was a big pocket in Bosnia.
But it was so real, what most of these kids seem to be doing were--

Kids who were raised in a Virtual World, kids who were raised in a mediated reality, looking for ways to
reconnect to the real, to express whether it's the number of bumps they feel on their bicycle on their way
to school or the number of people that have been killed in violent acts over a certain period of time, it
encouraged me that this is not a generation that's going out into the ether, but one that, if anything, is
going to help reconnect us to the real.
ROBERT BLOOMFIELD: Interesting. Now I haven't been studying digital culture nearly as long as you
have and most of what I've been looking at is in Second Life. But one of the things that I've seen in
Second Life and that seems hopeful to me is the economies that arise naturally in these spaces. And
actually, just like you get socializing in World of Warcraft and people, as you said, searching one another
out, you get entrepreneurship even in World of Warcraft, and certainly Second Life is just built for it. Your
most recent book Life Incorporated, I think, in part, it's about corporations, and, in part, it's just about
business mentalities even in our social lives. Have you looked much into the economies of these Worlds
and people interacting with one another as businesspeople?

DOUGLAS RUSHKOFF: Oh, yeah. I mean it's funny, because we were talking a little bit about it earlier, I
think you get the sense that I'm kind of anti-business, and I'm not at all. I'm pro business. I'm just pro
business more in the Adam Smith’s sense of pro business. I'm looking at the possibilities for a level

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playing field, in other words for business taking place on a landscape where the laws favor small
businesses and local businesses and peer-to-peer value exchange, as much as they favor value
extraction by corporations. So I'm looking at the ways, say, centralized currency that we use now, the
stuff we call money. I look at the ways it's incompatible with the kinds of peer-to-peer value creation and
exchange that can happen in a decentralized place like the internet or even a decentralized place like the
Real World.

I've done a lot of historical research: who invented centralized currency and when, and why, and what
kinds of currency did it replace, and what are its biases, and when did it all happen. It ended up being a
true education for me, kind of a shock. It was if you woke up in a world where every single computer had
the Windows operating system on it, you wouldn't know that there were once other operating systems
with different biases that worked in different ways. You would just think that this is a computer, just the
way we wake up and say, "Oh, this is money."

At the same time that there's this terribly scarce money, which is really good for some things but really
bad for other kinds of things, we start experiencing these other worlds. We start experiencing whether it's
the World of Warcraft or Second Life or even just the net. We start experiencing these other place where,
all of a sudden, we realize we can have other means of value exchange, just things other than that
money. So if the banks aren't going to lend out enough money into existence for us to exchange as much
as we need to, to work for each other and get everything we want done, are there other ways?

So Second Life develops its own currency. It can't help but allow an exchange rate to the dollar because
people are always going to want a buy-in rather than do whatever it is that one can do in Second Life to
have money. Someone's always going to be willing to spend a hundred bucks to get their cool clothes or
their dance moves or whatever it is or [their sex?] experiences. But it is still an alternative means of value
creation and exchange. Even though it's in a virtual model, I think it is introducing people to the idea that
you can create a different system of trust in exchange, and that's sort of what I'm really interested in. It's
what I think is ultimately behind the crash of the banking system is the fact that people can create value
on the net without borrowing a heck of a lot of money from the bank.

In the old days, if you talked to your grandparents, they want to open a store. They want to do something
in the world, you've got to go to the banker, and you got to get some money. Tell them your idea and
borrow some money and run your business and hope that you can pay him back. Nowadays you really
don't necessarily need to borrow a whole lot of money to start a business, and I think that's part of the
problem is that was really what the dot.com fall was about. These companies didn't actually need the
money. They could never get big enough to justify the amount of money that was being poured into them.
So banking went to real estate and other markets in order to try to find customers for their debt. And that
just kept going along.

Kids here and kids there with a thousand, two thousand bucks end up scaling up real businesses and
doing so without the need for all that investment capital. It's gotten to the point now where the moment
that you take the investment capital, usually now is the moment that you're leaving the business. That's
when you're retiring at 26 because you accept the money and move on.

ROBERT BLOOMFIELD: I guess if we really wanted to stretch this, it almost sounds like you're saying
the new media web media is basically right now killing traditional newspapers and traditional media,
unless regulators step in and big banks protect themselves, that could happen in banking as well?

DOUGLAS RUSHKOFF: You could say that. I mean what Craiglist did to the newspaper, decentralized
currency could do central banking, and that would be interesting. I don't think that it has to be one or the
other, certainly with money. I think that there's a tremendous need for the reinstatement of local
currencies and specific currencies because these giant national, long-distance currencies are really not
good for local transactions. They're biased against it. They're biased much more toward the Walmart and
the Costco and big agra and things like that than they are towards a community-supported agriculture or
local tutors or local manufacturing. It's what they were designed for. It's really what I write about in Life
Inc. That's what it was for.

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It's not a conspiracy or anything. Well, they were being kind of mean, but the object of the game, and this
was back in the late Middle Ages, was the feudal lords were getting poor. Feudalism was dying, and it
was dying because people were creating value. They were exchanging value. You were getting a middle
class. It was the beginning of an economy, and they really had to shut that down and replace with a
different kind of an economy, a centralized economy where the aristocracy could maintain its monopoly
over land and value creation, and that's how we got corporations, and that's how we got coin of the realm.
But it doesn't have to stay like that.

ROBERT BLOOMFIELD: I was really interested in one of the parts of the history that you tell, the history
of the corporation in Life Incorporated, and it's the part where there were a lot of merchants, and there
was a lot of shipping. And you describe one of the early steps toward the development of the corporation
being attempts to get some stability so that, as I understand it, before they had charters of limited liability,
you would send a couple boats out, and you'd become rich when they came back in. But eventually one
of your boats wouldn't come back. You'd go bankrupt, and someone else would come in and take your
place.

DOUGLAS RUSHKOFF: Right.

ROBERT BLOOMFIELD: What I find interesting is looking at the economy, definitely the businesses in
Second Life, but I think, in the web more broadly, you see exactly this type of constant shifting of who's
successful. It seems very difficult for these firms to actually establish themselves in a permanent way.

DOUGLAS RUSHKOFF: Well, right. I mean, in this case, I think it has to do with the fact that most of
these net companies don't actually make any money. They're all kind of speculative business models, and
people move from one thing to another really quickly. It's like you start an internet venture, it's kind of
cool, then you try to figure out a way to make money with it. And then you kind of change what it is in
order to bias it towards making money with it. And then people are like, "Oh. Screw this one. We're going
to go to the next one." So you go from whatever, Friendster to MySpace to Facebook to wherever people
are going to go now that Facebook has turned into everybody. And that is going to happen. I mean each
time people look at the thing that has the current advantage, and they think, "Well, this is it. Now let's
settle down." People are committed enough to their Friendster lists that they're never going to leave it.
And, of course, they go.

ROBERT BLOOMFIELD: They're what?

DOUGLAS RUSHKOFF: Of course, they move on. Worse case, the new company develops a
transitional app, "Click here to have all of your Facebook friends shoved into the new system." And that's
the thing, that's why it makes it so hard for any company to really maintain something over a long period
of time. Even a venerable company, a company like Apple. They're looking at the future, and they
understand that people are already taking Mac OSX and putting it on their Dell and HP Netbooks, and so
that cat is out of the bag.

Ubuntu is getting better and better and looks more and more--it kind of works like a nice little stable Mac
system more every day. They understand that the big money is not going to be in selling that stuff so
that's why they're really moving from OSX to the iPhone as their platform. And, believe me you, the
iPhone operating system is going to trickle up slowly but surely to more and more devices. And OSX will
be like Unix or something.

ROBERT BLOOMFIELD: Changing gears just a little bit, one of the things you talk about in Life
Incorporated is, people viewing themselves like corporations and thinking about themselves as having a
brand. You talk about the cult of all these self-help groups where people are very narcissistic I guess
should be the word and finding whatever, whether it's the secret which you talk about one of the
self-helps groups are neuro-linguistic programming, that they're really focusing on themselves as a brand
or a business. I mean that concerns you is my impression.

9

DOUGLAS RUSHKOFF: Yeah. I guess well, sure, it concerns me. When I went to meetings with people
who are followers of the secret and hear about what they do and how seriously they take it, that they think
that the path to success is to go through magazines and clip pictures of the things that they hope to own
and put them in a collage and put that over the fireplace in the house and meditate on that every day. In
other words, it's as if they're working towards the McMansion or the big car and that's going to be what
gets them--it's just bizarre that they seem to focus on this kind of "mind over matter" ability to change
reality by exploiting quantum theory. In other words, that, if they start thinking of things differently, then
the universe will slowly begin to conspire so that the car will appear for them through whatever business
needs, that their business will become successful.

At least the way most people seem to act on this is by just joining a new multilevel marketing scheme and
then using the secret exercises in order to build themselves up. But when I look at that, when I look at
okay, the secret plus Amway, and anybody can look at that and say, "Okay. The secret plus Amway,
that's really silly. Those people are really dumb." But then it's like, "Well, wait a minute. What about
Goldman plus real estate? What about debt-based currency plus capitalism?" When you realize, "Oh, my
gosh!" The thing that we're calling a real economy is based largely on the same notions of faith and
infinite growth and, you know, see it, be it, become it that some of these crazy cults are based on.

And, if you go back and look, this is America. This is Frank Baum, the Wizard of Oz guy who was also a
window dresser at Wanamaker, who helped come up with this kind of new Calvinist American positivism
that dovetailed so well with this early capitalist way of understanding business, this kind of "how to make
friends and influence people," sort of smile your way to success. That all you really need is faith in your
expansion and the expansion of the economy and this almost _____ meaning of growth.

ROBERT BLOOMFIELD: Yeah, you're pulling yourself up by your bootstraps.

DOUGLAS RUSHKOFF: You are pulling yourself up by your bootstraps. And it can work, as long as
someone else is being pulled down, as long as you're extracting someone else's value in the process, I
suppose that can work.

ROBERT BLOOMFIELD: On the brand side, I guess that was the part that where really I wondered. Well,
I guess let me just say I see it all the time, and I often think about it myself, that as an academic I have a
brand. I'm thinking when people think of Rob Bloomfield and his research, what do they think. I mean
think, in the old days, we would have called it reputation. It seemed to me in the book you were pretty
critical of people thinking of everything as a brand.

DOUGLAS RUSHKOFF: Well, if you look at what the brand is for. The brand. And I'm not talking about
communication about what you do. The brand. In the Industrial Age, in a mass-market culture, the brand
is there to create a mythology about a mass-produced good, to allow it to compete with a locally-produced
good. That's what it was for. So if I bought my oats for many years from Joe at the oat mill on the corner,
now a big oat company in Cincinnati, who's mass-producing oats with laborers instead of with oat makers
or oat experts, they need to recreate the relationship that I have with Joe, and they need to make it
happen between me and a cardboard box. And the way they do that is by branding the box. You put a
Quaker on the box. A Quaker's a great idea because Quakers are non-threatening. They don't really
believe in anything. They have great meetings. The guys sort of smile.

ROBERT BLOOMFIELD: And they're not going to punch us.

DOUGLAS RUSHKOFF: Right. He's got a mole on the cheek. So now I have a relationship with that
Quaker that needs to supersede the relationship with Joe. So we have all these companies and the stuff
and Walmart and Costco and the whole thing happens, and now, when human beings think, "Well, I've
got to compete," they think of themselves as competing with corporations, that the human being needs to
create a brand in order to compete with the corporation. It's sort of the way that churches and
synagogues think that they need to get hip in order to compete with MTV, rather than realizing that, "No,
no, no, no. You're not in the world of hip. Hip is for people who are trying to be cool or something." Real
religion, real spirituality is for people who are trying to connect or trying to let go of being cool and hip and

10

actually be human beings again.

So when I see people competing to be brands, that really what I'm seeing are people competing to
become something that's not human, to become this other thing, this thing that's actually alien. And, sure,
some people are successful at it: Donald Trump or Paris Hilton. The better you are at it is usually the
person who does nothing is the best brand. So Paris Hilton would kind of--that's why they offered her a
million bucks to go teach a course at Learning Annex in self-branding because she typified or epitomized
this idea that, if you're really a good self-brander, then that's all you actually have to do. You don't provide
a service. You don't do anything. You are a pure brand. I mean that's what her show is about, that she
couldn't do anything.

ROBERT BLOOMFIELD: So I see in the chat here, Fleep Tuque says, in all caps, "Corporations are not
people." And we're running out of time, but this brings me to the last thing I wanted to discuss with you,
which is, here you've just written a book, sort of a cautionary tale about corporate thinking, and last week
we had a Supreme Court case, Citizens United, which, in the view of many, basically said corporations
are people and have free speech rights. And I'd like to get your take on that court case.

DOUGLAS RUSHKOFF: Well, I mean the court case, all of this stuff is based on some really clever
shenanigans by corporations during Lincoln's presidency. It's really back in the 1860s that a court clerk
was probably bribed to add a note into the margins of a court decision that said the corporations get
protection under, what was it, the Fourteenth Amendments, the one that basically said Black people could
vote, I guess, and you couldn't discriminate against them, that that extended to the personhood of
corporations. So it wasn't any Supreme Court Justice who said this or anyone who voted. It was really
kind of a little error or addendum that was put in without anyone's permission.

That ended up really just becoming law, and the reason they did it was because railroad companies
wanted to get the rights to, you know, they wanted right-of-way through towns that didn't want them to
come through so they ended up getting the rights of people. And that sort of the basic rights of
personhood has been defended time and time again as that Amendment was brought up. It was used to
defend Black people maybe twice and used to defend corporations 2000 times because who's using the
courts. But this one now sort of elevates it. They're not just people. Now they're basically citizens.

Now the idea is that the First Amendment protection was there not just to protect people's right to free
speech, but to protect the sort of abstract corporation's right to use all of its leverage, all of its advantage,
both in the marketplace and in the marketplace we call Congress, to say whatever it wants to. And those
who are defending it are saying, "Oh, look. A corporation's not a thing. A corporation is just the people
who are in it, and why can't a group of people express themselves?" And the fact is a group of people can
express themselves.

A corporation is not a group of people. It's not what it is at all. A corporation might employ a group of
people. A corporation might be owned by a group of people. But a corporation's not a person. It never
was. A corporation's not even a collective. It's not. It's seen as a legal entity, and the interests of a
corporation are always, by law, because this is what they were made for, are always going to be to grow,
to extract value and extract wealth from human beings and to extract value from the land, in order to
grow. And their speech is always going to be about promoting that interest, and to allow a corporation to
say anything else would actually be against the law. So we've created our true Cylon competitors.

ROBERT BLOOMFIELD: I can't believe you said that.

DOUGLAS RUSHKOFF: And they're not robots. They are virtual beasts.

ROBERT BLOOMFIELD: Well, that is a great place to end because actually it's my show, I get to close
with some commentary, and I'm actually going to be talking about the Cylons, so I can't believe you said
that. Thank you so much for joining us, and I hope maybe we can get you on again, and I encourage our
audience to tune in to Digital Nation next Tuesday at 9:00 on PBS. And, of course, you can download
multiple copies of Life Incorporated, by Douglas Rushkoff, onto your Kindle or Nook. So thanks so much

11

for joining us, and I hope you'll stick around during my short commentary and chat with us after we close.

DOUGLAS RUSHKOFF: All right. Thanks.

ROBERT BLOOMFIELD: Thanks a lot. So we turn now to my closing commentary Connecting The Dots,
which I've actually titled Cylons United. Over the last couple of weeks, my wife and I have been catching
up on some important television culture. We're watching season one of the series Battlestar Galactica.
Even if you haven't seen it, you've heard the basic story many times. Humans create a race of robots
called Cylons who rebel and nearly destroy humanity. So think The Terminator without
Arnold Schwarzenegger or time travel, at least in season one. And, if you prefer, think Frankenstein's
monster.

So why do I bring this up now? Well, today's discussion with Douglas Rushkoff has two themes. First,
Douglas's Frontline show Digital Nation explores the wonders of the virtual ages, but sounds notes of fear
of what we have in our future. And, in a similar way, his book Life Incorporated explores the power of
corporations, not just in business, but in our personal lives. The issue is getting a lot of play right now
because the Supreme Court has just concluded that corporations have the right to spend unlimited sums
to promote their political views, in a case called Citizens United. So in light of all the heavy breathing
surrounding Citizens United decision, let me point out the obvious analogy of "Cylons United," to read the
popular press, corporations are Cylons, and it's only a matter of time before they rebel and destroy their
human masters, or, turning back to Digital Nation, are multitasking and sexting kids, may do the same.

I think the Cylons United name makes for good, sensationalist copy, but I actually see it more as a
dangerous copout, and I'm going to reach into the foundations of sociology to make my point. A
foundation of sociology is that individuals are agents. We have freewill agency to make intentional
decisions, and we're morally responsible for those decisions. But we exercise agency in the context of
institutions: laws, common practices and social conventions that are created by those who came before
us.

So money is an institution. Shaking hands is an institution. The digital age has created new institutions,
like posting profile pictures or typing emoticons. Social mores are institutions too. So when
Douglas Rushkoff talks about people seeing themselves as brands, and their neighbors or friends as
potential customers or investors, we can hold those people responsible for their behavior, but we also
have to recognize that their actions are shaped by the institutions that surround them.

People who are concerned about corporate power need to remember that corporations are institutions,
not agents. Now they're very powerful institutions, to be sure. They shape our behavior, and the people
who control corporations may abuse their power, but we, as individuals, and they are the ones with
agencies. When Cylons unite, we're right to fear them because they started out as tools, but they
developed agencies. Corporations have not, and I argue cannot. So rather than fear them, we have to
express our own agency and change these institutions. Now that's easier said than done. It's always
easier to add new laws and habits than it is to shed them. People become comfortable with institutions
and rely on them and fight to defend them.

Psychologists talk about status quo biases. Programmers and accountants talk about Legacy systems.
But however hard it is to change institutions, that's where our focus has to be. The worst thing we can do
is attribute agency to our institutions. Treating corporations like Cylons simply allows us to deny our own
agency and avoid responsibility for our own actions. Unlike Frankenstein or the inventors of the Cylons in
Battlestar Galactica, we haven't created a monster. By pretending we have, we risk creating monstrous
people who blame their own willful actions on their environment and not on themselves.

So that's my two cents. Join us next week on Metanomics when we talk with Sam Driver, of ThinkBalm.
Sam will be talking about his recent white papers on Virtual World technologies, and we'll take a look at
some successful uses of Virtual Worlds. And then the following week, Tony O'Driscoll and Karl Kapp talk
about their new book Learning in 3D.

12

Til then, goodbye, and enjoy tonight's State of the Union Address.
Document: cor1076.doc
Transcribed by: http://www.hiredhand.com
http://www.hiredhandtranscription.org

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Metanomics Transcript Jan 27 2010

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Metanomics Transcript Jan 27 2010