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Eric Ehrmann

Eric Ehrmann

Posted: February 1, 2010 11:19 AM

Last Tango in Davos ... Globalism and Social Media Hook Up

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Business and political leaders just gathered on the Magic Mountain hoping to beam up depressed financial markets. But the velocity of information is moving faster than the velocity of money and the fault may lie not in their stars, but in themselves.

Class warfare between capitalism and communism played out for 150 years and with the collapse of the Soviet Union and the U.S. crisis globalism is the eye in the triangle atop the financial ecosystem.

Without a rival economic system to challenge it, globalism now competes with itself. And, in the process of doing so, may be incubating its own enemy within.

Emerging from its cocoon with some help from the venture capitalists on Silicon Valley's Sand Hill Road, the brave new world known as social media seeks to the flatten the entrepreneurial focus of the emerging digital economy into a playground of blogs, tribes and conversations that reduce business from being the driver of market and oligopoly capitalism into an experience of stories, feelings and the wisdom of online crowds.

In the United States, social media tools like blogs, Twitter and fundraising websites helped Team Obama carry the banner of "Change You Can Believe In" to victory in 2008. Now, however, the White House is using social media to avoid a failed presidency and manage expectations downward as the US attempts to rebound from the economic crisis in the midst of a global credit crunch.

Social media is too new for slow moving government bureaucrats to regulate it, so its deceptive practices and bad actors get off easy with "guideline" status. Ethics and anti-corruption gurus like Lawrence Lessig don't go near that part of it . And since its all about advertising and marketing conducted in the form of conversations designed to shape consumer and business opinion about products and services there is no return on investment (ROI). Nothing is sold directly, therefore there's nothing to tax ... a big reason globalism likes it.

If you want to mobilize millions for earthquake relief in Haiti social media is a great tool. But the short attention span of social media Tweeple don't remember Bangladesh, a disaster ten times worse than Haiti that just had its 40th anniversary and hasn't recovered yet.

In the serial world of social media the next event will push Haiti off of the top slot on the Tweet Deck and social media users will be jonzein' for something new. One more reason why the American Psychiatric Association has classified a key group of online behaviors- like the games people play on Facebook- as addictions in the forthcoming DMS-V, just like heroin, crack, gambling and alcoholism.

The risk factor of assimilating the same globalist and American values that precipitated the current economic malaise is why nations like Brazil, China and France, with strong national infrastructures, have tough laws governing the internet. And its why social media advocates like US secretary of state Hilary Clinton interfere in the domestic affairs of China, accusing Beijing of not being open to Washington's concept of internet democracy. That's how the Opium Wars got started...

Major global companies like Pepsi and Ford are nurturing small budget experimental social media programs designed to promote causes and understand the consumer habits of younger generations. Social media's upside offers cheap, online advertising platforms at a time when companies and ad agencies are seeking to do more with less money.

Social media blogs and websites are also designed to capture data developed through online, debates, webinars and conversations. Bill Gates says the world should put less emphasis on developing cars that offer fuel economy and focus on low polluting vehicles that do less damage to the environment and cost $35,000. Broadening that discussion, Carlos Ghosn at Renault-Nissan and Ratan Tata of Tata Motors are talking about fuel efficient cars available now that help roll back the pathology of underdevelopment and cost just $4,000 in India, and elsewhere in Southern Asia. It remains to be seen if social media can earn its keep by promoting and managing a key sustainabilty conversation like this one.

Its a tough call because social media is having a problem exhibiting adult behaviors associated with mainstream business values. Social media is virtual and detached. From the viewpoint of behavioral psychology it behaves as an adaptive angry child, rather than as a stable, nurtured child because it is virtual and nobody nurtured it. Few social media companies have produced a steady, profitable bottom line or are reluctant to show it fearing regulation and higher taxes from the Obama administration. Those who provide the human capital that helps power social media blogs and websites sometimes work for free as interns, or for wages substantially lower than what basic jobs in mainstream advertising, public relations, and journalism pay.

What makes social media a radical subculture is that in the name of digital democracy, it assigns a higher importance to the feel good concepts of "social capital" and popularity than the monetary rewards that can help grow economies and build nations. Most social media blogs, websites and conversations are designed to be captured and read by machines, not humans, with the purpose of monetizing data provided freely when you click yes in a user agreement box. That data is mined by monitoring services who store it in a computer "cloud" and sell or trade it to other companies who use it in an attempt to add value to products and services that they market via other channels.

Social media is not the huge e-commerce websites operated by Amazon, Wal-Mart, and others. Nor is it a part of the software industry that powers PCs, business, government and mobile devices. It is a social, not a business movement. It is dominated by Caucasians with the cultures of the Indian subcontinent well represented. African-Americans and Hispanics are at the bottom of the social media food chain. Social media is an elite trying to get over on the mass market. And right now, mainstream business is doing more to reach out and help guide social media than social media is doing to reach out and listen to business.

In contrast to the three martini, gray flannel suit world of Mad Men, the high noise to volume ratio of social media bears a striking resemblance to the unfinished cultural revolution that grew out of the 1960s.

The Mad Men of the 60's didn't get it so an underground press developed to service the big market gap. In San Francisco Rolling Stone emerged from the underground under founder Jann S. Wenner and developed a business model, reached across the Atlantic and put a global focus on cultural freedom and the notion that "the music will set you free."

Wenner became the Henry Luce of his generation by taking the road rage out of alternative media because he matured, listened and learned from the likes of Max Palevsky of Xerox and William Coblentz, who sat on the board of regents of the University of California. He patronized rads like Abbie Hoffman and Jerry Rubin while moving his enterprise to the center, creating a huge fan base without the aid of Twitter or Facebook that helped open the market space for MTV and later, digital music and movies. And with the Cold War still going full tilt, every kid with a sense of self in Pinsk, Plauen and Plovdiv hungered to listen to rock music and wanted a copy of Rolling Stone.

Social media has yet to find a visionary leader like Wenner. Proponents of social media say its all about listening and dialogue. But they tend to evangelize rather than educate. The same crowd wisdom that advocates flat corporate culture, win-win outcomes and kinder gentler conversations defaults to rockstar idolatry among its own politically correct leaders. Seth Godin, author of the popular book Lynchpin and other tomes, does not even bother to offer his flock of social media followers a place to comment or interact with him at his own website.

Where Microsoft, SAP, Oracle and Linux software applications help people do business smarter, social media is time and labor intensive. Dell Computers, with a reputation as an aggressive, bottom line company, generated a paltry $6.5 million in gross sales through a social media program involving Twitter. The human capital required to grab that revenue, however, was 100 employees working over a two year period, each generating just $32,500 in business per year. Consistent with the hype surrounding social media, a Dell spokesperson characterized the program as "vibrant."

In their Davos video broadcast Edelman ranked the influence and credibility of social media below TV, industry analysts, and newspapers. Yet social media thought leaders and influencers behave as if their message is the key message. And as for the power and influence of Twitter, a recent study indicates that while Twitter has 75 million user accounts, a large percent of those are inactive, with about 25% of the accounts having no followers and 40% of the accounts having never sent a single tweet. Moreover, around 80% of all Twitter users have tweeted fewer than ten times.

If globalism wants to paint a positive image of itself, social media can be one of the colors on the palette, but not a primary color. Social media needs to grow up before living out its half-life like most other social experiments do or it will get co-opted by the globalist whale. Now, the self image of social media seems akin to a dog or cat looking into a mirror, touching and retouching the mirror with her paw because she has no sense of self.

In the dialectic between communism and capitalism, Lenin is said to have called creatures who exhibit this sort of anomie "useful idiots". Globalism hungers for malleable human capital and is flattening the personalities of people, national cultures and governments... who are globalism's "useful idiots?"