Friday, May 08, 2009

Douglas Rushkoff - Life Inc: Introduction

Douglas Rushkoff is excerpting his new book, Life Inc.: How the World Became a Corporation and How to Take It Back, at Boing Boing and at his blog. Looks interesting based on this first installment.

Here is the Introduction.

Life Inc: Introduction

Your Money or Your Life
A Lesson on the Front Stoop

I got mugged on Christmas Eve.

I was in front of my Brooklyn apartment house taking out the trash when a man pulled a gun and told me to empty my pockets. I gave him my money, wallet, and cell phone. But then—remembering something I’d seen in a movie about a hostage negotiator—I begged him to let me keep my medical- insurance card. If I could humanize myself in his perception, I figured, he’d be less likely to kill me.

He accepted my argument about how hard it would be for me to get “care” without it, and handed me back the card. Now it was us two against the establishment, and we made something of a deal: in exchange for his mercy, I wasn’t to report him—even though I had plainly seen his face. I agreed, and he ran off down the street. I foolishly but steadfastly stood by my side of the bargain, however coerced it may have been, for a few hours. As if I could have actually entered into a binding contract at gunpoint.

In the meantime, I posted a note about my strange and frightening experience to the Park Slope Parents list—a rather crunchy Internet community of moms, food co-op members, and other leftie types dedicated to the health and well- being of their families and their decidedly progressive, gentrifying neighborhood. It seemed the responsible thing to do, and I suppose I also expected some expression of sympathy and support.

Amazingly, the very first two emails I received were from people angrythat I had posted the name of the street on which the crime had occurred. Didn’t I realize that this publicity could adversely affect all of our property values? The “sellers’ market” was already difficult enough! With a famous actor reportedly leaving the area for Manhattan, does Brooklyn’s real- estate market need more bad press? And this was before the real-estate crash.

I was stunned. Had it really come to this? Did people care more about the market value of their neighborhood than what was actually taking place within it? Besides, it didn’t even make good business sense to bury the issue. In the long run, an open and honest conversation about crime and how to prevent it should make the neighborhood safer. Property values would go up in the end, not down. So these homeowners were more concerned about the immediate liquidity of their town houses than their long- term asset value—not to mention the actual experience of living in them. And these were among the wealthiest people in New York, who shouldn’t have to be worrying about such things. What had happened to make them behave this way?

It stopped me cold, and forced me to reassess my own long-held desire to elevate myself from renter to owner. I stopped to think—which, in the midst of an irrational real-estate craze, may not have been the safest thing to do. Why, I wondered aloud on my blog, was I struggling to make $4,500-per-month rent on a two- bedroom, fourth-floor walk-up in this supposedly “hip” section of Brooklyn, when I could just as easily get mugged somewhere else for a lot less per month? Was my willingness to participate in this runaway market part of the problem?

The detectives who took my report drove the point home. One of them drew a circle on a map of Brooklyn. “Inside this circle is where the rich white people from Manhattan are moving. That’s the target area. Hunting ground. Think about it from your mugger’s point of view: quiet, tree-lined streets of row houses, each worth a million or two, and inhabited by the rich people who displaced your family. Now, you live in or around the projects just outside the circle. Where would you go to mug someone?”

Back on the World Wide Web, a friend of mine—another Park Slope writer—made an open appeal for my family to stay in Brooklyn. He saw “the Slope” as a mixed- use neighborhood now reaching the “peak of livability” that the legendary urban anthropologist Jane Jacobs idealized. He explained how all great neighborhoods go through the same basic process: Some artists move into the only area they can afford—a poor area with nothing to speak of. Eventually, there are enough of them to open a gallery. People start coming to the gallery in the evenings, creating demand for a coffeehouse nearby, and so on. Slowly but surely, an artsy store or two and a clique of hipsters “pioneer” the neighborhood until there’s significant sidewalk activity late into the night, making it safer for successive waves of incoming businesses and residents.

Of course, after the city’s newspaper “discovers” the new trendy neighborhood, the artists are joined and eventually replaced by increasingly wealthy but decidedly less hip young professionals, lawyers, and businesspeople—but hopefully not so many that the district completely loses its “flavor.” Investment increases, the district grows bigger, and everyone is happier and wealthier.

Still, what happens to the people who lived there from the beginning—the ones whom the police detective was talking about? The “natives”? This process of gentrification does not occur ex nihilo.

No, when property values go up, so do the rents, displacing anyone whose monthly living charges aren’t regulated by the government. The residents of the neighborhood do not actually participate in the renaissance, because they are not owners. They move to outlying areas. Sure, their kids still go to John Jay High School in the middle of Park Slope. But none of Park Slope’s own wealthy residents send their kids there.

Our online conversation was picked up by New York magazine in a column entitled “Are the Writers Leaving Brooklyn?” The article focused entirely on the way a crime against an author could threaten the Brooklyn real-estate bubble. National Public Radio called to interview me about the story—not the mugging itself, but whether I would leave Brooklyn over it, and if doing so publicly might not be irresponsibly hurting other people’s property values. A week or two of blog insanity later, a second New York piece asked why we should even care about whether the writers are leaving Brooklyn—seemingly oblivious of the fact that this was the very same column space that told us to care in the first place.

It was an interesting fifteen minutes. What was going on had less to do with crime or authors, though, than it did with a market in its final, most vaporous phase. I simply couldn’t afford to buy in—and getting mugged freed me from the hype treadmill for long enough to accept it.

Or, more accurately, it’s not that I couldn’t afford it so much as that I wouldn’t afford it. There were mortgage brokers willing to lend me the other 90 percent of the money I’d need to purchase a home on the block where I was renting. “We can get you in,” they’d say. And at that moment in real- estate history, putting even 10 percent down would have made me a very qualified buyer. “What about when the mortgage readjusts?” I remember asking. “Then you refinance at a better rate,” they assured me. Of course, that would be happening just about the same time Park Slope’s artificially low property- tax rate (an exemption secured by real-estate developers) would be raised to the levels of the poorer areas of the borough. “Don’t worry. Everyone with your financials is doing it,” one broker explained with a wink. “And the banks aren’t going to just let everyone lose their homes, now, are they?”

As long as people refused to look at the real social and financial costs, the market could keep going up—buoyed in part by the bonuses paid to investment bankers whose job it was to promote all this asset inflation in the first place. Heck, we were restoring a historic borough to its former glory. All we had to do was avoid the uncomfortable truth that we were busy converting what were being used as multifamily dwellings by poor black and Hispanic people back into stately town houses for use by rich white ones. And we had to overlook that this frenzy of real- estate activity was operating on borrowed time and, more significantly, borrowed money.

In such a climate, calling attention to any of this was the real crime, and the reason that the first reaction of those participating in a speculative bubble was to silence the messenger. It’s just business. The reality was that we were pushing an increasingly hostile population from their homes, colonizing their neighborhoods, and then justifying it all with metrics such as increased business activity, reduced (reported) crime rates, and—most important—higher real- estate prices. How can one argue against making a neighborhood, well, better?

As my writer friend eloquently explained on his blog, the neighborhood was now, by most measures, safer. It was once again possible to sit on one’s stoop with the kids and eat frozen Italian ices on a balmy summer night. One could walk through Prospect Park on any Sunday afternoon and see a black family barbecuing here, a Puerto Rican group there, and an Irish group over there. Compared with most parts of the world, that’s pretty civil, no?

Romantic as it sounds, that’s not integration at all, but co-location. Epcot-style détente. The Brooklyn being described here has almost nothing to do with the one our grandparents might have inhabited. It is rather an expensive and painstakingly re-created simulation of a “brownstone Brooklyn” that never actually existed. If people once sat on their stoops eating ices on summer nights it was because they had no other choice—there was no air- conditioning and no TV. Everyone could afford to sit around, so everyone did. And the fact that the denizens of neighboring communities complete the illusion of multi-culturalism by using the same park only means that these folks are willing to barbecue next to each other—not with each other. They all still go home to different corners of the borough. My writer friend’s kids go off the next morning to their private school, those other kids to public. Not exactly neighbors.

Besides, the rows of brownstones in the Slope aren’t really made of brown stone. They’ve been covered with a substance more akin to stucco—a thick paint used to create the illusion of brown stones set atop one another. A façade’s façade. As any brownstone owner soon learns, the underlying cinder blocks can be hidden for only so long before a costly “renovation” must be undertaken to cover them up again.

Likewise, wealth, media, and metrics can insulate colonizers from the reality of their situation for only so long. Eventually, parents who push their toddlers around in thousand- dollar strollers, whose lifestyles and values have been reinforced by a multibillion- dollar industry dedicated to hip child- rearing, get pelted with stones by kids from the “projects.” (Rest assured—the person who reported this recurring episode at a gentrified Brooklyn playground met with his share of on-line derision, as well.)

Like Californians surprised when a wildfire or coyote disrupts the “natural” lifestyle they imagined they’d enjoy out in the country, we “pioneer,” “colonize,” and “gentrify” at our peril, utterly oblivious to the social costs of our expansion until one comes back to bite us in the ass—or mug us on the stoop. And while it’s easy to blame the larger institutions and social trends leading us into these traps, our own choices and behaviors—however influenced—are ultimately responsible for whatever befalls us.

Park Slope, Brooklyn, is just a microcosm of the slippery slope upon which so many of us are finding ourselves these days. We live in a landscape tilted toward a set of behaviors and a way of making choices that go against our own better judgment, as well as our collective self- interest. Instead of collaborating with each other to ensure the best prospects for us all, we pursue short- term advantages over seemingly fixed resources through which we can compete more effectively against one another. In short, instead of acting like people, we act like corporations. When faced with a local mugging, the community of Park Slope first thought to protect its brand instead of its people.

The financial meltdown may not be punishment for our sins, but it is at least in part the result of our widespread obsession with financial value over values of any other sort. We disconnected ourselves from what matters to us, and grew dependent on a business scheme that was never intended to serve us as people. But by adopting the ethos of this speculative, abstract economic model as our own, we have disabled the mechanisms through which we might address and correct the collapse of the real economy operating alongside it.

Even now, as we attempt to dig ourselves out of a financial mess caused in large part by this very mentality and behavior, we turn to the corporate sphere, its central banks, and shortsighted metrics to gauge our progress back to health. It’s as if we believe we’ll find the answer in the stream of trades and futures on one of the cable- TV finance channels instead of out in the physical world. Our real investment in the fabric of our neighborhoods and our quality of life takes a backseat to asking prices for houses like our own in the newspaper’s misnamed “real estate” section. We look to the Dow Jones average as if it were the one true vital sign of our society’s health, and the exchange rate of our currency as a measure of our wealth as a nation or worth as a people.

This, in turn, only distracts us further from the real- world ideas and activities through which we might actually re-create some value ourselves.
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