That’s the conclusion of an article by David Sacks earlier this week. He lays out recent developments to prove his point.
As the apex predators of capitalism, hedge funds are accustomed to raking in billions by driving companies into the ground and feasting on the carcasses. So there was widespread satisfaction last week when members of an online discussion group called WallStreetBets started beating the Wall Street bully boys at their own game … This quickly became a movement with a cause similar to that of Occupy Wall Street, except much more effective because it hit the intended target where they would feel it the most, in the wallet. “The only way to beat a rigged game,” one WallStreetBets leader said, “is to rig it even harder.”
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With combined losses of almost $20 billion, hedge funds were on the ropes and close to bleeding out, selling their longs in an increasingly futile effort to cover their shorts … All this outsider army needed to win was the continued ability to communicate with each other online, and their collective ability to keep piling into the “Buy” side of the trade. Within hours, they would be hobbled on the first front and crippled on the second.
The Empire Strikes Back
First, the digital distribution platform Discord banned the WallStreetBets account after the close Wednesday for “hate speech, glorifying violence, and spreading misinformation.” (For a moment, it looked like Reddit had also banned the group, but they resisted pressure to do so.) … Meanwhile, WallStreetBets investors were locked out of their trading accounts by online brokers such as Robinhood on Thursday morning … Normal trading was allowed to resume Friday, but the hedge funds used their 24-hour sole ownership of the battlefield to fortify their positions, covering the most vulnerable shorts. Wall Street then sent in reinforcements, as new short positions were taken at these high price levels, virtually guaranteed to pay out when, inevitably, the air leaks out of the balloon. Faced with a game that, for once, they couldn’t rig in their favor, it appeared that the insiders tipped the board over and started a new game. As a massively decentralized online group of scrappy outsiders, the only tools at WallStreetBets’ disposal were online trading and social networking. Both were frozen at the crucial moment, and the hedge fund insiders were let off the hook. The weaponization of censorship is a big part of the reason why.
Down the Slippery Slope
Some of us warned of a slippery slope when Parler was taken down and a sitting president was systematically ghosted from every online speech platform. But we could not have foreseen how slippery the slope would be, or how fast we would slide down it … The censorship power is always justified in response to a genuine outrage or crisis, but it is rarely relinquished once the threat passes. Rather it gets weaponized to protect powerful, connected insiders, as the GameStop fiasco illustrates.
How do we suppose Discord chose that moment to enforce its “Community Guidelines” against WallStreetBets? Almost certainly, one of the hedge funds whose ox was being gored combed through their message boards looking for anything that might violate the terms of service … They presumably reported the content to Discord, which took the group down.
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With the Town Square now digitized, centralized, and privatized in the hands of a cartel of Big Tech companies, the protections of the First Amendment no longer apply.
Insiders Vs. Outsiders
Censorship is about who has the power to censor, and what checks are placed upon that power. Right now, tech companies have all the power, and they exercise it as a like-minded cartel. When we see Alexandria Ocasio-Cortez and Ted Cruz voice similar concerns over what happened to WallStreetBets last week, we should realize that the politics of this issue in the post-Trump era will no longer divide along an axis of Left and Right, but of insider and outsider.
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Insiders are massively powerful but few in number. Outsiders have always been numerous but unorganized. Social networking and online organizing have given the outsiders real power to effect change, and finally register their disgust at the way incompetent elites protect each other. The elites of Big Business, Big Media, Wall Street, and Washington are terrified of this, and will leverage any censorship power to keep the outsiders at bay.
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What all of our elites have in common is a reason to fear social media. Legacy media hates social media for disrupting their business models and competing with them for influence. Wall Street has just learned that organized social networks can threaten their control of the Monopoly board. The party in power benefits from increased censorship and repression of political dissent by labeling it “hate speech” and “disinformation.” Ironically, the tech oligarchs benefit the least from the censorship they impose, but the threat of break-up keeps them in line.
If there is a Big Lie in American politics right now, it is the idea that censorship of social media is necessary to save democracy … What the insiders fear is not the end of democracy, but the end of their control over it, and the loss of the benefits they extract from it. Ultimately, the battle over speech is just one aspect of a broader war for power amid a growing political realignment that is not Left versus Right, but rather insider versus outsider. Thanks to social media, the outsiders are threatening to replace who’s in the Tower, and the insiders have never been more scared.
There’s more at the link. Recommended reading.
What the oligarchs tend to forget is that they are few, and they are human. Sooner or later, the power of numbers begins to tell against them, and they become vulnerable to the anger and resentment of those they’re manipulating and controlling (or trying to control). Americans, of all the people in the world, are least susceptible to being told what to do. Proportionally, there are probably more independent-minded Americans than there are in any other national population. If I were among the oligarchs, I’d be getting increasingly worried at the signs that those Americans have seen through their deception, and are banding together to oppose them.
The American Conservative calls what we’re seeing now a crisis of confidence for our oligarchs. Bold, underlined text is my emphasis.
The more outrageous aspects of the last few months—from Twitter censorship to post-election whiplash—may be best understood not as the first flashes of an ascendant tyranny, but as a flurry of idiotic moves by an elite who clearly have much less faith in their hold on power than we do.
The wild saga of GameStop’s stock adventures over the past week or so is a perfect illustration of the point … The move resulted in jaw-dropping profits for some of the amateur traders—and a whole lot of anger from the Wall Street establishment … So what did our robust market system do? Simple: citing market volatility, Robinhood and other day-trading services just restricted transactions on GameStop and other WallStreetBets picks. The big funds, meanwhile, were free to continue trading as normal. Besides giving the big guys a chance to get their ducks in a row, the freeze caused the stock to crash on Thursday morning, costing many amateur investors a pretty penny.
It’s corrupt and immoral, and I’d be mad as hell if I’d been smart enough to get in on the GameStop craze. But it’s not the kind of thing that confident oligarchs do. It suggests the same fear that’s motivated so many decisions by people in power these past few months. Not to mention it may spark a backlash that will be well worth watching—and that may yet change our course in surprising ways.
Again, more at the link.
I strongly suggest that independent-minded Americans find social media that won’t be cowed or intimidated into obeying the oligarchs. I’m on Gab and MeWe, and have been for years. So far, both appear to be resisting pressure from outsiders to censor their members, apart from obvious violations like trying to motivate others to violent crimes. I’ll continue to support them as long as they support free speech.
Bloggers like myself are vulnerable to deplatforming, although so far Google’s Blogspot appears to have resisted the temptation to play that game. However, nobody knows whether that will continue. An increasing number of bloggers are therefore moving their outlets to new platforms that (they hope) will be able to bypass such deplatforming. I’m taking steps in that direction myself. They’ve not yet come to fruition, but if this blog should one day no longer be accessible, look for it at https://bayourenaissanceman.com/, and see where that leads you.