You can’t see everything: Elizabeth Holmes and the age of the techno grift

Chris Gay is a contributing columnist for The Globe and Mail. He is a former Wall Street Journal staffer and writes the newsletter Figure at Center.

“Show me the incentive, and I’ll show you the outcome.” – Charlie Munger

There are moments in the buzzy, genre-bending documentary You Can See Everything when you wonder if you’re watching a mockumentary. Director/co-star Nathan Fielder and his evasive subject, Theranos charlatan Elizabeth Holmes, talk past one another at times in a manner reminiscent of the old “Who’s on First” routine. Mr. Fielder, in fact, streams the bit for his subject on a laptop to illustrate her tenuous grasp of irony, if not of reality. Their cringey exchanges prompt audience laughter.

But the humour here is of the gallows variety. Nearing the start of an 11-year prison sentence, Ms. Holmes has allowed Mr. Fielder, co-director Lance Oppenheim and a small film crew to document her last days of freedom. Judging by the public response to what ensues, they have pressed whatever button activates mass schadenfreude at a fraudster brought low.

Mr. Fielder isn’t the only one gunning for hypesters this season in the target-rich environment of techno-utopianism, whose latest fixation, of course, is artificial intelligence. We also have Thomas Frank’s just-published The Creativity Con: How Innovation Became America’s Biggest Racket. The title references a kind of faith-based ideology that enjoys undeserved public reverence and conveniently large blind spots for its own perverse consequences.

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“Market-minded creativity talk,” the pious boosterism of tech bros and venture capitalists, has merely “helped concentrate society’s wealth at the top, destroy labour unions, allow monopolies to form, privatize science, and so on,” writes Mr. Frank. “These consequences were not violations or perversions of creativity theory. They were faithful expressions of this doctrine’s essential elitism.”

If Mr. Frank doesn’t move you, try Musk, a four-hour documentary exploring the darker facets of the world’s richest megalomaniac. Its subject, predictably, calls it a hit job, but director Alex Gibney adduces some pretty damning evidence for the prosecution. That would include everything from Mr. Musk’s purchase of Twitter, now the snake pit of tribal animus known as X, to his misleading claims about swappable car batteries, a ploy to secure state EV subsidies.

Next up, Aaron Sorkin’s The Social Reckoning (sequel to his 2010 film The Social Network), which portrays an implausibly Vulcan Mark Zuckerberg, founder of Facebook, blithely wreaking social havoc in pursuit of the holy grail called engagement. “It’s business,” he proclaims. But, of course, so is crack dealing.

These works are well-timed to caution folks about overwrought techno-optimism, either as investors or just as citizens. AI may prove the most transformative technology in history, but it may for the moment be in the sort of misleading hype cycle that shiny new technologies tend to generate. As Goldman Sachs recently noted, the productivity benefits of transformative technologies can take years to realize.

Investors planning a swan-dive into the next trillion-dollar AI listing (Anthropic filed for its IPO Monday) might note a striking resemblance between today’s AI cheerleading and the New Economy evangelism of 30 years ago (hilariously pilloried in an earlier Frank book, One Market Under God). We don’t need to recapitulate how that ended.

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The Holmes and Musk films contain similar quotes to the effect that both protagonists were good at convincing investors of what they already wanted to believe, at least for long enough to extract their money. Genius-worship and wishful thinking can create irrational herds, so it’s a fair question whether AI is just the latest iteration of the this-time-is-different illusion that has ensnared investors since at least as far back as the South Sea bubble of 1720 and as recently as defunct cryptocurrency exchange FTX.

As for social consequence, how much skepticism is in order this time around? Should you trust AI hyperscalers to “pace the frontier” of development until they can contain the risk? Or is their avowed concern with the “alignment problem” – making AI safe for humanity – just a cynical distraction? Given the stakes and the personalities involved, it’s a good idea to recall the Charlie Munger dictum above. We’re dealing, after all, with a self-selected subset of ferociously ambitious people for whom too much seems never to be enough. Winning for the sake of winning is life’s pre-eminent object. Moving fast and breaking other people’s things is the business model.

Messrs. Fielder, Oppenheim, Frank, Gibney and Sorkin have provided timely reminders that the profit motive has a way of turning human-centric idealism – “don’t be evil,” “bring the world closer together” – into justification for race-to-the-bottom predation and naked pursuit of dominance for its own sake. The longshoreman philosopher Eric Hoffer explained this process in succinct terms: “Every great cause begins as a movement, becomes a business, and eventually degenerates into a racket.”