The Company’s Town
When tech companies make their own governments.
Imagine you accept a job offer at an innovative technology company promising to change the world. Your role will be based in Nevada. And by the way, you get to live in the company’s very own town. And that town comes complete with a government completely controlled by your new employer.
This scenario may not be too far off.
Governor Steve Sisolak of Nevada imagines this as a potential future for the state of Nevada.
According to a draft proposal not yet introduced to the Nevada legislature, select tech companies, if deemed innovative enough, would be allowed to set up their own local governments—on top of receiving the typical industry-attracting incentives.
In these “Innovation Zones,” corporate governments would be made up of a three-member board of supervisors. And any local ordinances adopted by that company board would supersede the rules of that Zone’s county.
Sisolak’s potential law lists eight types of tech companies that would be allowed to set up an Innovation Zone: Blockchain, Autonomous technology, Internet of things, Robotics, Artificial Intelligence, Wireless technology, Biometrics, and Renewable resource technology.
Originally conceived as an alternative to the typical publicly funded tax breaks that are used to attract new industries. Most striking about the proposal is the interesting outlook on how traditional government works.
The text of the bill paints traditional local government as “inadequate alone to provide the flexibility and resources conducive to making the State a leader in attracting and retaining new forms and types of businesses”.
This is bold language to push through the same traditional local government that the bill finds inadequate.
While the proposal in its current form is more valuable for its shock value more than an actual law, it can best be understood as a proposal for a modern-day Company Town.
Company Towns of the Past
There is a long, and lasting, history of company towns stretching back to the 1800s, primarily known for popping up during the industrial revolution.
Altogether, there have been about 2,000 company towns across the U.S., ranging from the harsh to downright pleasant.
Whether created as a practical solution for job sites located too far from employee residencies or developed out of a paternalistic effort to create a utopian worker’s village, the conclusions were usually the same.
When corporations wield too much control over worker lives, the results were not often in favor of the worker-citizen.
Modern Day Company Towns
In the present day, tech giants like Google and Facebook are becoming the new faces of employer created communities.
Google plans to build between 5,000 and 9,850 homes on its property in Mountain View complete with retail stores and entertainment.
The Facebook developed Willow Village promises a 59-acre site in California’s Silicon Valley — fully equipped with housing, offices, a grocery store, a pharmacy, and a possible cultural center.
The idea of a community founded on the ideals of Facebook seems scary enough without the looming threat of total local government control.
Willow Village has recently updated plans to reflect community calls to match jobs and housing, increase affordable housing, minimize traffic, and deliver essential services faster — echoing the assumed distrust of traditional government baked into Nevada’s Innovation Zones.
What’s Wrong With Providing Employee Housing?
My answer is there is nothing wrong with more housing. I can’t argue against companies taking action to create a better society.
Yet, there is something troubling about the assumption that what is good for the largest tech companies, is good for the country — or local community.
The true problem seems to be the expectation that a company is better suited to handle societal problems, rather than the elected officials tied to the community.
One critic of Willow Village, researcher Evgeny Morozov, described the problem of tech companies’ interest in community development as solutionism.
To Evgeny, the real problem is Silicon Valley’s tireless efforts at problem-solving.
Does there truly need to be an app to solve all of life’s problems? Or would well-thought-out governmental regulation be more effective?
As innovation grows it gets easier, and more attractive, for government institutions to offload responsibility to multi-national corporations.
Frequently, the perceived efficiency of private companies has been a welcomed presence in the personal lives of the world’s nations.
While it is true that the American brand of government is dysfunctional — to say the least — as the Industrial Age proved, unregulated businesses do not lead to paradise for all citizens.
Especially the disadvantaged populations that are not potentially profitable markets.
Lessons from Company Towns
While not all Company Towns of old turned dystopic, there was a lingering, irresistible incentive for some towns to do so.
In some of the worst-cases, companies paid employees living in their towns with a scrip only good at company stores. With no viable competition for miles, “company towns could become exorbitant, and the workers built up large debts that they were required to pay off before leaving.”
While many of the towns — with both good and bad intentions— were economically prosperous, they were often plagued with pay cuts, poorly build housing, or unreasonably high rents.
But in the end, it was often the lack of political representation that ended otherwise fruitful social experiments.
A prominent example is Pullman, Chicago where “workers often had no say in local affairs”. Ultimately, the Illinois Supreme Court required Pullman to dissolve its ownership in the town amid massive labor strikes and deadly violence.
Reform
The inherent promise of Nevada’s Innovation Zones, Willow Village, and Google’s Mountain View community is that tech companies are better equipped to tackle the problems of a modern society.
Better than partisan governments, elected representatives, or community legislations, the market forces ruling businesses are trusted as efficient distributors of power.
But history has taught us to be skeptical of that claim.
The Nevada policy discussed here is unlikely to pass in its current draft form. But it may pass a version in the same vein. Facebook and Google are still on track to build their own communities. And other companies are likely to follow suit.
It feels inevitable that, in the age of outsourcing and constant cost-cutting, governments won’t continue the trend of offloading core competencies to the private sector. The past 30 years of pursuing cold-hearted efficiency have trained us to see the bottom line as the only line that matters.
But representation in our governance is still a lot worth fighting for, and shouldn’t be given up on easily. Democracy is messy. American democracy in particular is no doubt frustratingly slow.
I still believe making democracy work for all is always a better option than giving up the collective power for the promise of more money and better apps.
