Opinion

Edward Hadas

AOL, solidarity and health insurance

Edward Hadas
Feb 19, 2014 15:59 UTC

The head of the American internet company AOL managed to say something really stupid a few weeks ago, and to sound callous at the same time. It’s a shame Tim Armstrong came off so badly, because he was trying to deal with a serious topic.

Armstrong was trying to justify the company’s decision, since reversed, to trim its employees’ retirement benefits. He started out at a disadvantage, because the chosen cutback was sneaky. A change that sounds innocuous, moving from monthly to annual employer payments into employee pension savings accounts, is actually a way to eliminate payments to employees who leave before the end of the year. It’s hard to look honest and upfront when explaining that.

But the former Google bigwig turned a disadvantage into a public relations disaster by bringing up the high costs of caring for two employees’ premature babies. The implied complaint about these million-dollar infants sounded heartless and invasive. In more humane hands, though, the Armstrong discussion could have been a fruitful one. The challenges that AOL faces are built into the way Americans arrange their employee welfare programs.

For most workers, their total remuneration combines payments that are supposed to be determined by what their labor produces and payments that are determined by some measure of their personal needs.

The pre-tax salary is totally in the first category, while healthcare benefits are almost entirely in the second. Pensions are usually somewhere in between. Defined contribution plans are more like salaries while defined benefits are calibrated by the presumed needs of a former employee who used to earn a certain amount.

Bitcoin is a step back not forward

Edward Hadas
Nov 27, 2013 16:00 UTC

The developers of bitcoin are trying to show that money can be successfully privatised. They will fail, because money that is not issued by governments is always doomed to failure. Money is inevitably a tool of the state.

Bitcoin relies on thoroughly contemporary technology. It consists of computer-generated tokens, with sophisticated algorithms guaranteeing the anonymity, transparency and integrity of transactions. However, the monetary philosophy behind this web-based phenomenon can be traced back to one of the oldest theories of money.

Economists have long declared that currencies are essentially a tool to increase the efficiency of barter, which they consider the foundation of all organised economic activity. On this view, money is a convenient instrument used by individuals to get things done. It is not inherently part of the apparatus of government.

Social media sets us free, or not

Edward Hadas
Jun 12, 2013 14:15 UTC

Modern history can be told as a story of new communications technologies which both undermine authority and reinforce the power of the state. The last week has shown that the Internet and social media are playing these two roles well.

Start with the contrasting historical narratives. In the 15th century, printing undermined the autocratic Catholic Church. A few centuries later, cheaper printing made possible the newspapers and pamphlets which helped destroy monarchies and then spread democracy, nationalism and revolution around the world. Telephones and now the Internet have sped up the process.

But there is also the expanding state. Printing allowed central governments to set up and monitor extensive bureaucracies. Cheaper printing gave governments the means to take control of the education and indoctrination of children. Add in telephones, communicating computers and now the Internet, and liberal governments feel free to set up an extensive bureaucracy which monitors and guides almost any aspect of life.

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