Community Spirit at Bargain-Prices!
Air-bnb has announced its future vision —and a new logo. Supposedly composed from a heart, a location marker and the letter A, the logo has already been the target of much ridicule, needless to repeat here. The logo is not the point. One of the its main virtues, according to the company’s announcement, is that it is easy to draw. This serves a function: people all over the world are offered to draw the logo on just about anything they are willing to share for a fee. As the company’s statement says, Air-bnb is not just about sharing spaces, but sharing homes. It is a community. “And what makes this community so special is that for the very first time, you can belong anywhere.” The company’s emphasis on belonging, as its ‘core value’ in corporatese, is also reflected in the new logo’s name —and yes, it has one: Bélo. Vale. Bene. Bien. Na gut.
The other kind of value that comes to mind is, of course, the worth of the company’s stock: what Air-bnb’s 32-year-old CEO Brian Chesky refers to as ‘community’ is made up of half a million listings in around 190 countries —”that’s every country in the world but North-Korea, Iran, Syria and Cuba,” according to Chesky himself— at a worth estimated by some sources as $10 billion. That would be around $20,000 per current listing, which admittedly seems extravagant. In any case the company’s market value is at least a 10 figure number, making each listing worth some thousands of dollars. Presumably these estimates are based on future speculation, that the company’s listings will grow in number. But what, precisely, is being capitalized?
At a gathering called ‘Aspen Ideas Festival’ at the end of last month, Dr. Judith Rodin, President of the Rockefeller Foundation, called Air-bnb a ‘key driver behind this new idea of the sharing economy, which is really changing dramatically how people are thinking about, and how they tap into, the latent assets that are all around us’. Latent assets meaning not only that extra room in your apartment, but, potentially, any aspect of that part of your life that you don’t call work. You know your way around your neighborhood? That’s already an asset. You have a favorite bar, you know the best local place for snacks? That’s an asset. You know how to cook great vegetarian lasagna, or make your own sushi, and you like to have people over for dinner? Asset. Overall you are a friendly, outgoing person, with great conversation skills —people generally enjoy your company? Guess what … In the words of CEO Chesky: “People, for the first time, can become micro-entrepreneurs. They can actually build a reputation and they can offer goods and services.” Perhaps more importantly than any other of your assets, your reputation is now one. More on that later.
One of Chesky’s examples of how sensible sharing can be, is that according to an unspecified study, any power-drill is used, on average, for only 13 minutes in its lifetime. Yet every neighbor has one. ‘What the hell? Why can’t they just share?’ He then goes on to speak of the importance of a ‘holistic view’ of the economy and our whole eco-system, implying that many of our resources are, more or less, like that power-drill. If you only have a narrow view, he says, Air-bnb may look like a revolving door letting random ‘twerps’ circulate in and out of your building. On the other hand, if you have a holistic view and you are concerned about utilizing earth’s resources efficiently, you’ll see Air-bnb’s great potential. There is, however, more to it than that. According to Chesky, Air-bnb is not only about such joint use: “The much bigger idea is this: we used to live in a world there were people, private citizens, and businesses. Now we live in a world where people can become businesses. In 60 seconds. That’s a profound shift.”
Now first of all, let’s admit the wildly positive elements of this whole endeavor. And to fully appreciate its potential, let’s inflate the thing towards its apparent ideal. CEO Chesky says he sees the company’s growth as “the beginning of a golden age. It’s an opportunity where we can build 10 million … maybe a 100 million entrepreneurs or micro-entrepreneurs all around the world.” Not just Air-bnb, but others following suit, he adds. In official marketing material, the company speaks about building the ‘shared world’, city by city. The ideal, in other words, is that whatever asset may be lurking around in your private life, so long as you are willing to share it with strangers, to make them feel more at home in this world, there is a platform to do so. For a fee. Something of the sort has admittedly been around for a while, but for free, and thus irrelevant to ideas festivals.
First of all, Dr. Rodin is probably right when she mentions the sustainability effect: we might make better use of the resources we already have, than is the case today, and sharing would probably help. Secondly, as marginal as it may seem, Air-bnb-driven community projects such as providing shelter to victims in disaster areas have, as it seems, already proven effective. Both of these effects remain somewhat hypothetical however, compared with the already apparent effect on traveling: those who would otherwise have stayed in hotels, joyless and lonely, can now presumably have more fun, gain more experiences and enjoy the sense of belonging, in the company of locals. In the words of Chesky: “Suddenly, I’m not anonymous when I’m buying. You, as a seller, can provide me a personal experience. You know I like Bob Dylan so when I go into a home or a hotel-room you can be playing that music. If I am a recovering alcoholic and I open the mini-bar and there’s alcohol in it, that’s like a sick joke. Like, why are you doing that, as a hotel?” Well, why would you do anything as a hotel?
The fourth obviously positive factor is the extra income now available to potential hosts. In the long-term, this income may not be wholly pocketed by the hosts: apart from taxing, Chesky himself mentions that some landlords have already realized that they can charge higher rents, if they state explicitly that the building is ‘Air-bnb-friendly’. Since markets are markets, that tendency can obviously be expected to increase. Nonetheless, at least for the time being, the extra income makes a difference for lots of people.
Traditional hotels and hostels fear the competition for obvious reasons. Reykjavík is only one of the world’s cities where such businesses put pressure on authorities to regulate, tax or even outlaw this new kid on the block. A more convincing reason to regulate has, however, been the effect of this sort of network on rental prices. They go up. In some cases drastically. You can simply earn much more renting out a room or an apartment to travellers, whom you charge per night, in a price-range competing with hotel rooms, than by renting the same premises to a long-term lodger, charged per month. Due to the price-effect, Berlin authorities, for example, decided on a total Air-bnb-ban earlier this year, with exceptions possible through individual licenses, only granted in neighbourhoods proved not to be suffering housing shortages and rental inflation.
The difference between these two markets, accommodation for travelers and regular housing, involves more than the price alone. Their respective context also decides whether Air-bnb feels like belonging to a community more or less than before. For habitual hotel-lodgers it must fell like stepping out of a shopping mall into, well, someone’s home. Evidently, that’s more ‘community-spirit’. For those, however, who already belonged to some informal community, some non-financial network of family, friends, and acquaintances, people who would be glad to have you stay over, when needed, the mediation of Air-bnb means monetizing relations that used to exist outside such circuits. For these, the tendency would be towards less ‘community-spirit’. The same goes, to some extent, for those who habitually took on lodgers anyway: The network creates a tendency to charge, not according to estimated costs as has been the implicit principle in many communities, but according to market standards. That’s not just more money, that’s a whole different category of money.
Broadly speaking, this means, that —if the business plan works out at all— people above a certain threshold of income will travel and gain something that feels like community; people below that threshold will host and thus exchange some of their private and communal lives for a fee. Those with insecure or low incomes, who might otherwise travel, stay over or lodge, will face the tendency to be kicked out or, probably more frequently, not to be invited in the first place: your niece’s couch, that would have been available, will now be occupied by someone who can afford it. To be sure, these will not be the members of society’s upper echelons spending their holidays at the homes of poor immigrants and the unemployed. The tendency is rather towards a fluctuating split within the lower to upper middle classes. Some people will presumably both earn and spend money within the platform. Nonetheless, this is unmistakably capital absorbing and fencing in something that didn’t, until now, belong to it.
This logic has, of course, been outlined before: the greatest merit of capitalism, according to Marx, is how it dissolves traditional social relations, and establishes new ones. Later authors, however, may seem more relevant. Significantly, Chesky says that Air-bnb was ‘really started out of necessity’. How so? “In late-2008, I would get letters from people saying thank you. And I was trying to understand what they meant. They said: Because of you we could keep our home. In the city of New York, 62% of people live at or below median income.” Now, late-2008 is a point in time very familiar to inhabitants of Iceland. From the onset of that infamous year’s economic crisis, some people stayed alert for signs of Kleinian Shock-Doctrine effects: that the emergency would be used as an excuse for capital to make gains in new areas, whether through exploitation of natural resources or communal assets such as schools and hospitals. According to Chesky himself, the advance of Air-bnb can be seen as a variation on that theme: people are renting out parts of their homes and private lives, at least to some extent, because they have to. In other words, capital said: I’m sorry, your mortgage will keep inflating, living costs will keep rising, public services will be downsized, and your salary will stay stagnant —but if you have a meaningful private life, and you are willing to hand some of that over, we just might work something out for you. In the words of Don Corleone, it is an offer you can’t refuse. What’s more, most hosts would presumably not raise their voices about such circumstances, at least not in the presence of any potential visitor, since an atmosphere of oppression might damage the host’s reputation and, hence, their business.
When asked whether the company reacts to cases of apparent discrimination, for example a host who would refuse to accommodate African-American travelers, Chesky replies: “We believe in a world where we can live together and where everyone can feel like they belong. And if you don’t believe in that, you shouldn’t be on our platform.” He says thousands of people are removed from the community each day, mainly for not being the sort of people who want everyone to belong. Ideally, it’s a community for everyone who wants a community for everyone, and keeping it that way is easy, since “we don’t need the same kind of evidence a government would need, to enforce regulation against a person. We don’t need the same due process.” Nonetheless, the network obviously has a strong tendency to exclude one globally significant social group: those with lower incomes. In Aspen, however, that logic is either too self-evident to mention, or simply imperceptible. Aspen lies a couple of miles above sea-level. Anything below would obviously tend to blur.
Among those partaking in the network, the key differential will ideally be neither race, gender, class or any other such outmoded line of division, but reputation. In short, the idea is that through a network such as Air-bnb, not only companies will have a reputation to uphold, but also their customers, i.e. individual buyers. “The entire idea of privacy and ownership, I think, will change completely. You were anonymous as a buyer and the store had a reputation. Suddenly you as a buyer have a reputation. That’s going to change everything,” says Chesky. Asked about the relation between, the broadcasting of tastes and transactions involved in building up a reputation, and what used to be known as privacy, Chesky replies: “There will be anonymity in the future. But I don’t think, generally speaking, the sharing economy will have that much anonymity to it. I think that you can determine how private or public you want to be. And the more you broadcast your reputation, the more you will have access to. So you can decide, to kind of live off-the-grid, not have a reputation, and that’s fine, you can go through your life. But fewer people will know you and you’ll have access to fewer things. I think that’s actually a fair proposition.” In other words, the business model presumes a strong incentive to erode privacy.
In other words, inasmuch as the business plan succeeds, it involves a pretty drastic series of changes. Chesky admits as much, although he likes to put it in the mildest terms possible —unlike many other Silicon Valley executives, he doesn’t like the connotations of the word ‘disruptive’: “We may be part of a macro-economic revolution. I think that’s very different from saying we ‘re just disrupting everything.”
Having stated the obviously positive and the obviously negative, there is at least one more potential left to mention: the seemingly negative effects of this whole enterprise are what any Marxist would tend to recognize as positive —in the long run: The erosion of traditional community and local ties, as such ties are succumbed through globalization, is precisely that part of capitalism’s creative destruction which Marx praised as its most liberating side-effect. In the present case, this version of capitalism feels so wafer-thin, that a revolution would hardly involve any serious effort: it seems as if, one day when our computers feel a little absent-minded, the capitalist underpinnings of this thing might simply evaporate in a puff of digital smoke, without much notice. After the evaporation, if you still need money to gain access to Air-bnb’s network at all, it would be merely a symbolic amount, low enough to exclude no one. We will all be hosts and visitors by then, sharing the joy of roaming in a state of constant, careless migration, cooking for each other, showing each other the things we love, belonging, in the words of Chesky, anywhere.
And yes, like that of so many other techno-evangelists, Chesky’s utopian vision has strongly communist undertones. No, but really. Listen. He says: “I think in the future, ownership is going to be turned on its head. I think in the future, you will only own what you want responsibility for. Today, people own a lot of things because there’s this kind of romantic notion of ownership. In the future, it’s going to be much more about what you want responsibility for. A lot of people here probably own a lot of things. Maybe your kids don’t own a car, don’t ever want to own a car. Car-ownership is plummeting, home-ownership is plummeting, I even think people don’t have the same attachment to material items as they did.” This doesn’t sound like what we’re used to think of as capitalism. Or when he goes on to speak about alienation: “I think there’s a more important movement happening here. This idea that people can live together and share together. … I think, as a culture, we have become incredibly cynical, we have become incredibly isolated, become incredibly distrustful of strangers. But these aren’t strangers. Almost every single one of those people is somebody who has a family, friends.” Inasmuch as this is a Mao speaking, he is an understanding, mild-mannered Mao, unlikely to rush people into his cultural revolution any faster than they themselves can manage: “My hope is that the more people live together, the more they start to understand each other. I stayed with a host once who was a drag queen. They made dinner for me. It was like the craziest, most amazing experience. But somebody’s fairytale can be somebody else’s nightmare. And I don’t want to try to mix everyone together overnight and cause this incredibly hostile environment. So I think we have to take time.”
Without losing breath, right after speaking of the importance of a holistic view of the earth’s resources and their utilization, Chesky then started talking about privatizing public transportation. The buses will have wifi and baristas, he said. Being indisputably a capitalist enterprise, Air-bnb’s vision is limited to the field of capital’s perception: no credit, no access. It is communism, yes, for those who afford it, so no. It’s sort of like fracking —supposed to save the planet, it is a bit more ruthless than earlier methods, seems interesting at first, then just a lot of noise, in the place you’re still supposed to call home. Then you get used to it. Humans are amazingly adaptable.
This new business variety should, in the words of Chesky, feel like ‘it’s not a transaction’. Why? The obvious answer is: because transactions are the opposite of community. To feel like we belong, while paying for it, we must do a little hocus-pocus, look away while we pay, and then act as if it never happened. When that works out alright, you are all set to feel at home. Do you remember how, in earlier eras of civilization, humans are supposed to have, at regular intervals, sacrificed members of the community, to pacify a vengeful god or a monster —after which the tribe or city could presumably carry on its communal living? Caught up in the inescapable piece of rust we call an economy, isn’t it curious that the one thing people seem to desire most, the thing capitalism keeps betting on, is its opposite, a community, something that feels like it’s specifically not a transaction? Something that feels like it’s not just a momentary conciliation with a monster.