Wrong Again, Zuck

Mark Zuckerburg (quoted in The Facebook Effect p. 287):

Are you familiar with the concept of a gift economy? It’s an interesting alternative to the market economy in a lot of less developed cultures. I’ll contribute something and give it to someone, and then out of obligation or generosity that person will give something back to me. The whole culture works on this framework of mutual giving. The thing that binds those communities together and makes the potlatch work is the fact that the community is small enough that people can see each other’s contributions. But once one of these societies gets past a certain point in size the system breaks down. People can no longer see everything that’s going on, and you get freeloaders. When there’s more openness, with everyone being able to express their opinion very quickly, more of the economy starts to operate like a gift economy. It puts the onus on companies and organizations to be more good, more trustworthy. It’s changing the ways that governments work. A more transparent world creates a better-governed world and a fairer world.

Lewis Hyde (The Gift p. 36):

Potlatches were held to mark important events, such as a marriage or, most often, the assumption of rank by a member of a tribe. The oldest and most universal occasion for a potlatch was the death of a chief and the subsequent elevation of his successor to the vacant rank and title. … Status and generosity were always associated; no man could become a man of position without giving away property. … The tribe would labor a year or more to prepare the ceremony, if only to collect the treasure to be given away … .

In Mark Zuckerberg’s imagined potlatch, Facebook users are giving each other gifts (or should I say Farmville Gifts?), from which Facebook, almost incidentally, reaps a share of the value. But in a real potlatch, it would be Mark Zuckerberg giving away almost everything he owns.

We have a kind of supplementary gift economy right here in the modern US, although it’s broken down considerably in my lifetime. Both gifts and favors (services, provision of valuable information) are considered as things that are “owed.” That is, they are given with the expectation of a future return, or given in payment for a previous gift or favor from the other person. People often calculate their number, nature, and value implicitly or even explicitly, as in “he owes me a big favor,” “the wedding gift I gave them was more expensive than the one they gave me” and “he helped me paint my garage last summer, so I can hardly refuse his request to help him paint his porch this summer.”

This economy, however, usually depends on some kind of personal relationship, whether it’s friendship, family, community, or business. A certain tolerance is often extended, as in “she’s out of work, so I understand why she gave me an inexpensive wedding gift,” but if the giving of gifts or services is too one-sided the relationship starts to break down. Check out Dear Abby and Miss Manners for umpteen examples.

Businesses have exploited this personal economy for a long time, as in “if we send you a free ball-point pen, maybe you will feel an obligation to subscribe to our magazine, or at least consider our advertising instead of throwing it away unread.” But the Internet, and Internet-related businesses, have exploited this economy to the extent of breaking it down. E-groups consisting of hundreds or thousands of people are described as communities, but most of the members remain relative strangers, and membership is often anonymous or pseudonymous. So what happens is, a handful of people repeatedly supply the relatively higher quality of free information. Everyone else enjoys it with no sense that any return is ever required. There’s an assumption of a kind of Internet karma—no one feels obligated to return a favor because the person providing it will probably somehow, someday get some kind of return from someone else entirely.

And, Internet companies where the users are providing the information/favors/freebies—Google et al—are doing their best to exploit any remaining feeling of obligation by taking the credit for what the users give away (or what they sell and parties like Google have appropriated) and transferring that obligation to their companies.

Is there that much of a qualitative difference between the trust of a gift economy and trust in ” I promise to pay the bearer of this bit of worthless printed paper”?


US money is still printed and stamped with the slogan “In God We Trust.” Maybe they think it makes the Treasury sound more reliable, with that kind of backing.

I suggest that they should read the Book of Job.