Mary-Catherine Lader: Sometimes it feels like all topics lead to technology these days. And it's not just in dialogue with our friends, our families, our coworkers, it's also what we ask when we're alone. Our Google searches of buzzwords like blockchain and 5G are up over 1,000% in the past couple years. Searches for fintech are up 843%. And Google searches for AI have risen 38%, even though AI is a decades old subject. But what tech topics aren't we talking about? We asked around to find out.
Man 1: How bad actors are using technology to disrupt our political and financial systems and what we can do to defend ourselves both personally and as society against those actions.
Woman 1: I don't want to carry around credit cards anymore because I want to use Apple Pay for everything.
Woman 2: Corporate governance within ride-sharing companies.
Man 2: Within the next 10-15 years, we're going to be living in a society where people will be walking around with glasses that will give you directions of where to go, tell you the names of buildings. Keep an eye out for augmented reality, it's going to take over.
Mary-Catherine Lader: So what else aren't we covering? On this episode of The BID, we'll speak to Kevin Roose, technology columnist for the New York Times and best-selling author. We'll discuss how technology is influencing our politics and culture, and his own journey as he tried to stop using his phone. I'm your host, Mary-Catherine Lader. We hope you enjoy.
Thanks, Kevin, for being here.
Kevin Roose: Thank you for having me. What a pleasure.
Mary-Catherine Lader: Such a pleasure to have you. You write a technology column for the New York Times called The Shift. Before that you covered Wall Street, you've written a couple books. And you're really familiar with the world of business, politics, and also the underbelly of the internet. What got you into this cross section and what about technology got you to start writing The Shift?
Kevin Roose: Well, I have always been obsessed with technology. I was a child hacker, prodigy-not prodigy, but I liked to go on weird parts of the internet, I had lots of Geocities webpages. I had a little web design business with my brother. From a pretty early age, I was into not only the internet but the things that the internet made possible. And then I graduated from school, I got into financial journalism because I was writing a book about Wall Street. And then after that, I saw sort of the world moving to tech. A lot of my sources, people I talked to in finance and in consulting, they were moving out to San Francisco to work at startups, they were transitioning into engineering, they were going back to school to learn how to code. It just felt like there was this kind of tectonic shift that was happening that was pushing people that I knew and respected into tech. And I thought, well that is interesting. Maybe I should go spend some time trying to figure that out. And then it just happened that the woman that I was dating at the time, and am now married to, lived out in California for school. So I thought, well maybe I could combine these things and go to California to write about technology, and that's what happened, and here we are.
Mary-Catherine Lader: But you came back to New York.
Kevin Roose: Well, this partner of mine, this spouse, my wife, she is law school here in New York. I just keep following her around basically and adjusting my career accordingly - but no, I like writing about technology from New York, because I think I lived in Silicon Valley for several years and have an understanding of the reality on the ground there. But I think it gives me a useful remove to have some distance. Often I felt in San Francisco, it's hard to be objective about the tech industry. When your friends work at these companies, you are constantly running into people that you know. And you get a very cloistered worldview at certain times out there.
Mary-Catherine Lader: And so much of what you write about is what people aren't talking about, and then they start talking about it, because you have a great ability to spot these sorts of trends and things that we should be talking about. What do you think people aren't talking about right now? It feels like tech dominates all headlines, all companies are technology companies, so what is there to cover that isn't being covered?
Kevin Roose: I do think technology is the story right now. It really feels like we're transitioning from one economy to another. And we're part of the way through that, which is why you see every company being a tech company. But I guess they call it the fourth industrial revolution. Which is not a phrase that I love, but I think it's useful in terms of it positions this as the correct size of transition, I think. And so I don't think we're talking enough about AI and labor and the future of work. We talk a lot about it, but I think if we had a better understanding of what was happening, it would be all we were talking about. Do you feel like there are other things we should be talking about?
Mary-Catherine Lader: No, I think that is a lot of it, AI and the future of work. We think about that all the time in financial services. There are a lot of jobs that will be affected. And it's funny, because it's hard to figure out where you start in the conversation about AI and ethics and work. Do you just bemoan the potential loss of jobs in the future?
Kevin Roose: I had the same question, like I didn't really know where to start with it. So a couple months ago, I started going back and reading about the first, and second, and third industrial revolution, what was it actually like to be a farmer in the 19th century who suddenly saw these factories springing up and thought, "Oh Man, I've got to go to the city now and leave my farm and go get a job in a factory." What was it like to work in an auto plant in the mid-20th century and see the robots coming in around you, and you think, "Oh, I should probably find something else to do." And was the actual cumulative impact of the changes on the societies which took place? I'm a little bit of a history nerd, so I love going back and reading contemporaneous, you know, what were the people of 1830s England saying about the factories?
Mary-Catherine Lader: And have you found a good analysis that gives you hope about the future? For example, I sometimes wonder, has anyone done an economic analysis of the impact of the washing machine? That was positive for most people. Have you found good work that gives you hope about what this could mean in the fourth industrial revolution?
Kevin Roose: I think that the default story is one of hope, right, because we all used to have terrible jobs, like farming is not a fun job and it's back-breaking, and it's unsafe. And it's good that only two percent of us need to be farmers now to feed the other 98 percent, it's good that our productivity has resulted in better jobs. But there is some pain involved in the transition. It's not like we just snap our fingers and all the farmers become factory workers and all the auto engineers learn to do other skilled labor. It takes a while for society to catch up with the technology, and that is happening faster this time. It took a long time for technology to proliferate in these earlier shifts, and now it's happening every day.
Mary-Catherine Lader: And where do you think the dialogue among technology leaders, founders, people you interview about this is like right now?
Kevin Roose: Well, there is kind of a public dialogue and a private dialogue. So, I've heard both because I'm a journalist, so when people talk to me, they usually have their public face on. In that case, the public discussion is, we'll get through this essentially. We have made every transition before in our history work, automation is going to create new categories of jobs we don't even know what they are yet, and people will find new opportunities. There is not a fixed pie. The private conversation was often a little bit bleaker than that, I find. Because these companies feel enormous pressure to automate. They feel if they don't do it in the next quarter, their competitor is going to do it. And their margins are going to get fatter, their shareholders are going to reward them for that and the people who don't automate, are going to be left behind. So I think there is an incredible amount of pressure felt by corporate leadership to do this as quickly as possible. And frankly, maybe too quickly. Maybe it should take a little longer for this to be implemented in the company, knowing that people are going to be affected by this.
Mary-Catherine Lader: Do you see anyone trying to do anything about that? I think about the minimum basic income advocacy and some attention to solutions. Is that about headlines and PR? Are you seeing anything tangible?
Kevin Roose: No, I don't think that is about headlines and PR. I think people understand that every transition has some elements of good things and some elements of pain. And if we can ease the pain for people, that's good. We should do that. And I'm actually optimistic. I think that part of what we see in periods of technological transformation is that actually huMan skills become more important. A lot of people for a lot of years, their jobs were basically robotic, they were taking things from one place and putting them in another place, or they were changing cells on a spreadsheet. And it's good if we don't have to do that anymore, we get to do more creative things. We just need a system that supports that transition and the people who can't make the jump or can't make the jump as easily.
Mary-Catherine Lader: Part of what we're doing at BlackRock through Aladdin Wealth is basically building technology software algorithms that help our clients, banks and wealth Management firms transition to using technology to make a financial advisor's life more about their connection with the client. And what is funny is that a lot of those startups who a couple years ago were like, "We don't need people, we don't need huMan advisors. It's going to be all the algorithm." They're now adding huMan advisors. So there is this equilibrium of huMan plus technology that we're reaching at least in wealth Management. What kind of trends have you followed in financial services or fintech, given that you started your career on Wall Street, and how have things played out maybe any differently than you would have expected?
Kevin Roose: I'm fascinated by the venture market right now. I know it's not exactly financial services but the VC economy is really interesting to me. I know Uber (NYSE:UBER) filed to go public. And that is a fascinating example of a company that got enormously large, raised more money than probably any private company in the history of private companies. And it's just a different model. We've never seen a company go public this large with this much venture money in it. I'm fascinated by the growth and explosion of the venture capital-backed ecosystem and all those services that we all depend on every day that may not have gotten off the ground were it not for these resources of private capital.
Mary-Catherine Lader: And do you think in the wake of these IPOs, that people are raising just as much money? It seems like nothing has really changed. It's not daunting the hopes of today's entrepreneurs or the expectations of today's venture capitalists doing those early stage deals.
Kevin Roose: No, I think there is a natural skepticism of loss-making companies, but I think people generally understand that you lose a lot of money for a little while, and hopefully you get market share, and then you can have pricing power. The bad example of this is MoviePass, which I wrote about last year, which had explosive growth because they were basically losing on every transaction, they had negative margins on every new customer. So that is not the best model, but there are models I think that work. We saw Amazon be unprofitable for Many years, and I think they're doing okay now.
Mary-Catherine Lader: But that premise of get so big so that you have pricing power, there is something about that that is a little complicated in terms of its relationship to the consumer, right. And it's amazing to see all these brands be so beloved by all of us, because they're convenient. But ultimately if the business model is to have pricing power, it's a little anticompetitive. Do you think we're catching on to that? Do people talk about that when you are covering them, or no?
Kevin Roose: It's great for consumers. They get all this cheap stuff, right. We get movies for free and we get rides to the airport for probably 20 or 30 percent less than their natural price would be in an unsubsidized market. So for consumers, it's great. I think if you're the investor, how long are you willing to subside growth? I think those are questions above my pay grade. For consumers, I think we're living in a golden age of cheap stuff. And I used to joke, I had a friend who was a venture capitalist out in San Francisco and every time I would use one of these services that he funded, I would say thank you for the three dollars, really appreciated the discount on that ride. And he didn't think it was funny.
Mary-Catherine Lader: But he should have thanked you for being a user. So what other kinds of things are you writing about these days?
Kevin Roose: Right now I'm really interested in social media and the reckoning around privacy and data use, and extreme content. I've been doing a lot of reporting on Facebook (NASDAQ:FB) and YouTube, and I think we're sort of at a moment now where we're collectively reckoning with the fact that a lot of our lives are connected to these platforms that may or may not have our best interests at heart.
Mary-Catherine Lader: And what do you think will change as a result of the increased public attention around behavior or policy?
Kevin Roose: I think there will be some regulation. I think everyone at this point expects regulation of at least privacy and maybe some content stuff. I think people are starting to view these services differently. I'm not sure what the average user of these services feels, but I know at least amongst the people that I know, they're having different conversations about it than they would a couple of years ago, I don't know, what do you think?
Mary-Catherine Lader: I think the piece about the fact the devices in your home may have a huMan listening, maybe attached to a huMan that is transcribing your words, when that becomes real, that is pretty powerful. Whether it changes your behavior, I don't know. I haven't changed any of my behavior. I check Facebook a little bit less.
Kevin Roose: But you're still on it.
Mary-Catherine Lader: I'm still on it.
Kevin Roose: So am I.
Mary-Catherine Lader: I still love the device in my home. And I'm curious what lessons from the financial crisis and regulation in the wake of that there are for social medial platforms and whatever may transpire here. The content is so different, the nature of the issues is so different, there may not be any whatsoever. But it will be kind of interesting to see how that gets shaped and written and then how it gets digested by these companies, particularly because it's not really an area where those writing the rules have a lot of depth of expertise or even use it themselves.
Kevin Roose: Yeah. I've sat in enough hearings to know that Congress is not logging into Instagram all that often for the most part. I think there are some useful lessons from the financial crisis and one thing that we saw with a lot of the post-crisis regulation is that it really did entrench the big financial institutions. It became prohibitively expensive and hard to start to form a new bank. There are basically zero new banks since the financial crisis. And I think the big banks are probably safer and less levered and have better capital controls than they did before the crisis. So in that sense, I think the financial system is better for more people. But, if the goal was to break up the banks, they certainly didn't do that.
Mary-Catherine Lader: So bridging your two worlds that you've covered the most, financial services and technology, and now that we're in this fourth industrial revolution, what ways do you see financial services ripe for disruption and change?
Kevin Roose: Well, I think some of this is happening around the margins, we're seeing little things like the lending models are changing for personal finance, we're seeing robo-advisors. There is a lot of startup activity that is being used as a pilot vehicle for the rest of the industry, like oh, we can do that we can do robo-advisors, let's do that, or acquire one ourselves. My sense is that the financial service is actually ahead of a lot of industries in terms of technological adoption. So high frequency trading has been a thing for decades, and there's been lots of automation throughout these firms. I still think there is room for improvement on a lot of these. I think a lot of things like underwriting, there is still a lot of opportunity for automation there. I think you have to be careful with things like underwriting because if you have biased data, you're going to have biased results for things like home mortgages. But trying to get through one interview without mentioning the Blockchain world, it's very hard these days. But I do think there are probably some useful applications there.
Mary-Catherine Lader: As you're covering these tech companies and everything they're going through in Washington and with consumers now, any lessons for financial services?
Kevin Roose: I think one thing that has really stood out to me and that has surprised me actually is how responsive these tech companies have been to their own workers. We've seen in the past year, engineers at Google (NASDAQ:GOOG) (NASDAQ:GOOGL) and Amazon (NASDAQ:AMZN) and Microsoft (NASDAQ:MSFT) and other large tech companies, push for real change within those companies, and be listened to. I think that because the talent pool is so tight there, because these are such valuable employees, they've found out that they have a lot more leverage than they thought. And if their firms aren't doing things that they feel proud of, they can band together and change that. And it doesn't take very many of them. It doesn't take very long. So I think that in financial services and every industry, some social responsibility can be led from the top and the hope is always that the top is leading, and in the cases where it's not, the workers actually have a pretty substantive impact in the right situations.
Mary-Catherine Lader: That makes a lot of sense, especially since millennials are now the majority of a lot of these firms -
Kevin Roose: Really?
Mary-Catherine Lader: Yeah. Yeah. The average age at BlackRock (NYSE:BLK) is 34, which is a millennial actually. Well, also millennials not so young anymore.
Kevin Roose: Right.
Mary-Catherine Lader: So a lot of what you spend time on is gloomy and negative, but you also--
Kevin Roose: What are you talking about?
Mary-Catherine Lader: I guess the dark underbelly of the internet. But you also give out good tech awards. So who got good tech awards this year and why?
Kevin Roose: This is my favorite column of the year, because you're right, I do spend 51 weeks a year in the muck of the internet. But then at the end of the year, I like to actually look at some of the people and companies who are doing great things for the world. So this year, let's see, I had a company called Zipline that does blood delivery by drone. So they have remote places in Sub-Saharan Africa or other places that need medical supplies for hospitals and remote clinics. And they actually now have drones that they can plop the bag of blood onto and shoot it out, and get it to the place where maybe you couldn't get an ambulance. So that is really cool. There was also a great project run by Code for America which is a non-profit that does civic coding projects. In San Francisco they had a law passed where you could expunge your criminal record if you had a marijuana-related conviction. But it involved a lot of paperwork, it was kind of cumbersome. And so a lot of people just didn't know how to do it who were eligible for it. So Code for America teamed up with some organizations and built an automated system where you could just automatically expunge these convictions, which was a great example of automation in practice, creating more justice and equity for people. So things like that, I like to save up through the year. I have a little folder in my inbox that is good stuff, and every time I feel a little bit down in the dumps, I just look at that and remind myself that not everything is horrible.
Mary-Catherine Lader: Right, exactly. So I'm going to end with a rapid fire round of a couple questions for you. Okay, are you ready?
Kevin Roose: Yes.
Mary-Catherine Lader: Okay. So you were on Times' list of 140 best Twitter feeds.
Kevin Roose: Oh my god.
Mary-Catherine Lader: What is your social media of choice, Twitter (NYSE:TWTR), YouTube, Instagram, other?
Kevin Roose: Other. I'm really into TikTok right now, which is a Chinese lip-syncing app-
Mary-Catherine Lader: Why?
Kevin Roose: It's amazing, it's so good. I wrote a whole column about it, you can go check it out. But it's very happy. It's just people being silly on the internet, like it used to be. And it's delightful. You will feel very old if you are over 25 and you open TikTok. Like I felt like I was chaperoning a school dance or something. But it's delightful.
Mary-Catherine Lader: So you had a 30-day breakup with your phone. What is the consensus?
Kevin Roose: Phone, but less phone. I did this detox because I was on my phone for five and a half hours a day on average. And it was getting in the way of my marriage and my work and life, and I just thought, this sucks, I don't want to do this anymore. So I got a phone coach, who helps me--
Mary-Catherine Lader: That exists?
Kevin Roose: She's amazing, she's my phone coach, and she helped me get down from five and a half hours a day to one and a half hours a day. No phone is not the answer. No one can have no phone in 2019 unless you're like Amish. No shade on the Amish, they've got it figure out. But I do think we can be more intentional about how we use our phones and not just use it to kill time.
Mary-Catherine Lader: So in that period, you picked up pottery?
Kevin Roose: I did.
Mary-Catherine Lader: Are you sticking with it?
Kevin Roose: I hope so, it's really fun. It's fun to do something with your hands that doesn't involve a screen. It gets your hands really dirty, you can't really check your phone while you're doing pottery, and it's very meditative. I made some very crappy bowls-if anyone is in the market for some mediocre bowls, I've got a cupboard full of them.
Mary-Catherine Lader: Who has been your most memorable interview?
Kevin Roose: I did a show at an anime convention once, you meet a lot of characters at an anime convention. So let's see, I interviewed a vocaloid, who is a hologram pop singer. So it doesn't actually exist, but I did a story about these imaginary pop singers who have thousands and thousands of fans that come to their "concerts." So that was pretty weird.
Mary-Catherine Lader: So all more memorable than Mark Zuckerberg?
Kevin Roose: Mark Zuckerberg is fine. He's no hologram.
Mary-Catherine Lader: And what book do you want to write next?
Kevin Roose: Oh Man, well I am writing a book now but I can't talk about it yet. It's loosely on this issue of AI and the future. So 2020, get your Amazon carts ready.
Mary-Catherine Lader: Okay. So stay tuned.
Kevin Roose: Yes, stay tuned.
Mary-Catherine Lader: Thank you so much for joining us, Kevin.
Kevin Roose: Thank you for having me.
This post originally appeared on BlackRock.
Editor’s Note: The summary bullets for this article were chosen by Seeking Alpha editors.