Free Throwing Rocks at the Google Bus: How Growth Became the Enemy of Prosperity by Douglas Rushkoff Page A

best staying the same, but these digital businesses have managed to get bigger pieces of it—making it harder for every other corporation around, including themselves in the long term.
    In large part, this is because they’re still operating as if they were twentieth-century industrial corporations—only the original corporate code is now being executed by entirely more powerful and rapidly acting digital business plans. What algorithms do to the trading floor, digital business does to the economy. In the purely rational light of the computer program, a digital corporation is optimized to convert cash into share price—money and value into pure capital. Most of the people enabling this have no reason to believe it is harmful to the business landscape, much less to human beings.
    At worst, argue today’s generation of technopreneurs, we are undergoing a whole lot of “creative destruction.” That’s the process, first coined by Marx but popularized by Austrian-American economic philosopher Joseph Schumpeter, 20 through which the economy achieves a natural churn. Simply put, it’s a description of how young companies with superior technologies or processes invariably unseat established ones. Old ways of doing things are replaced by better ones. There’s pain, as companies go out of business and people lose jobs, but ultimately there’s gain, as the new market establishes itself. Automobiles replace horses, destroying a host of horse-and-buggy-related businesses while replacing them with auto shops and gas stations. Portraiture is replaced by photography, and in turn Kodak, the dominant photography company, is brought down by the advent of digital cameras and smartphones. Independent bookshops are destroyed by superstores such as Barnes & Noble or Borders, which are themselves destroyed by Amazon.
    In other words, this activity may be destructive to the companies or categories that die, but opportunities for new enterprises are created in the process. It sounds really promising on the surface, more like the young replacing the old or a more developed species replacing a weaker one. As Schumpeter suggests, it’s just another form of evolution.
    This rationale has been enough to keep most thoughtful Silicon Valley entrepreneurs from worrying too hard about the repercussions of their actions. After all, digital corporations will necessarily carry out corporate code better than their predecessors. They apply the engineer’s logic to every situation or choice and always optimize for the best and most defensible outcomes. For example, last century’s retailers mailed out catalogues and then used sales feedback to adjust the offerings for the next quarter. A digital company will A/B test its Web page, display ad, or online catalogue in real time. Every interaction is a test of a bigger/smaller font, a higher/lower price, friendly/formal language, and so on. The thousandth time a page is rendered, it has evolved into a much better selling mechanism. Digital is better.
    Each and every choice and process can be made more efficient, more responsive to market conditions, and more persuasive to users. And why shouldn’t companies optimize for victory? Whether it’s MOOCs replacing in-person college courses, Web sites replacing stores, apps replacing newspapers, or streaming MP3s replacing radio, it’s only creative destruction. Either get with the program or get run over by it.
    That’s the sanguine interpretation of creative destruction, held by the winners since industrialism began. If you’re the unhappy victim of a plant closing, the resident of an abandoned community, or the owner of an undercut small business, you are an unfortunate but necessary sacrifice to business innovation and free-market competition. Free-market advocates celebrate creative destruction as the way that scrappy young upstarts come and unseat the most powerful companies on the block. But Schumpeter also suggested that each new winner takes over