The stock market has been in overdrive, with the S&P 500 SPX, -0.29% and the Dow Jones Industrial Average DJIA, -0.13% poised for double-digit gains this year. But even as valuations surge and stocks trade at all-time highs, things rarely change at the top.
Ford Motor Co. F, +0.10% relinquished its title to Dow Chemical Co.DOW, -0.11% in Michigan, and Kraft Heinz Co. KHC, +0.62% booted McDonald’s Corp. MCD, +0.73% from its perch in Illinois. There were also changes of the guard in Alabama, Mississippi, South Dakota and West Virginia.
This is what the same graphic looked like in 2015:
With President-elect Donald Trump largely expected to espouse pro-growth policies via increased spending and large-scale infrastructure projects, it will be interesting to see what the map looks like in 2017.The 2016 map looks a lot like the 2015 version, with a few exceptions.
[A previous version of the map for 2016 contained an error for Colorado. The report has been updated with the correct map.]
“It looks like this December will be the coldest in at least four years,” said Evan Gold, executive vice president of global services at Planalytics. The colder winter comes after a warm November.
In the “buy now, wear now” society that we’re living in, “weather becomes the largest external driver of need,” Gold said. With winter weather setting in, shoppers are once again reaching for items like coats, gloves and scarves. Most of the $350 million that Planalytics forecasts will be generated on the East coast, according to Gold.
Moreover, necessity will prompt shoppers to pay a little more, generating higher margin sales.
“Winter isn’t coming. Winter is here,” said Gold. “Because we’re in a buy now, wear now mentality, customers will spend more money on a coat.”
The Weather Channel says it’s tracking Winter Storm Decima, which will cross the country bringing snow and perhaps even ice and sleet. While retailers want to see some seasonal weather come their way, they don’t want to take it too far.
“Retailers need enough snow to get in that winter mindset, but not so much that keeps people away,” said Gold. “It provides a helpful environment.”
Terry Lundgren, Macy’s chief executive, expressed a similar sentiment when MarketWatch spoke with him over the long Thanksgiving holiday weekend.
“I can’t ask for complete perfection here, but if I could, it would be a light snow at night,” he said at the time.
National Weather Service Issues Winter Storm Warning
The National Weather Service has issued warnings for parts of the Great Lakes and the Northeast. Image: AP
With weather cooperating, analysts believe stores will move their inventory in a timely fashion.
“Overall Weather Trends International [WTI] believes retailers will be able to clear out winter merchandise at full price and will not have much leftover to sell into first quarter 2017, given a significantly colder winter,” wrote Cowen & Company in a note published Dec. 7.
Even if weather becomes prohibitive, there’s always e-commerce. But that’s not the answer to everything.
“[W]eather can still impact what customers buy thus leaving retailers exposed to potential post-season markdowns if their assortment doesn’t align with customers’ needs,” said Jared Wiesel, partner at Revenue Analytics. “Weather also plays a major role in the customer experience post purchase, as it can have a large impact on on-time shipping rates for goods bought online.”
WTI says “brick-and-mortar retailers with a strong e-commerce platform” will do well given the cold weather and precipitation. Based on this weather information, Cowen believes Wal-Mart Stores Inc. WMT, +0.22% will be a holiday season winner.
Wal-Mart shares are up nearly 2% for the past month, and are up nearly 19% for the last 12 months. The Dow Jones Industrial Average DJIA, -0.17% is up 14.6% for the past year.
“WTI cautioned that mall traffic could suffer if there’s too much snow,” Cowen wrote. “In addition, WTI estimates that home heating bills could rise by 5% to 10% versus last year given a forecast of colder weather, though higher heating bills could mean less money in consumers’ wallet to use towards incremental purchases in early 2017.”
The human brain is a natural wonder. It produces more than 50,000 thoughts each day and 100,000 chemical reactions each second. With this amount of processing power, you would think our judgment would be highly accurate, but that’s far from the case.
Our judgments are often inaccurate because the brain relies on cognitive biases over hard evidence. Cognitive bias is the tendency to make irrational judgments in consistent patterns.
Researchers have found that cognitive bias wreaks havoc by forcing people to make poor, irrational judgments:
A Queensland University study found that blonde women earned, on average, 7% higher salaries than redheads and brunettes.
A Duke study found that people with “mature” faces experienced more career success than those with “baby” faces. “Baby” faces were defined as those with small chins, wider cheeks, and bigger eyes. “Mature” faces were those with bigger chins, narrower facial features, and smaller eyes.
A Yale study found that female scientists were not only more likely to hire male scientists but they also paid them4,000 more than female scientists.
It’s highly unlikely that the people in these studies actually wanted to pay blondes more money, enable people with mature faces to succeed at the expense of those with baby faces, or hire male scientists disproportionally and pay them more money. Our unconscious biases are often so strong that they lead us to act in ways that are inconsistent with reason as well as our values and beliefs.
Let’s explore some of the most common types of cognitive biases that entrench themselves in our lives. Awareness is the best way to beat these biases, so pay careful attention to how they influence you.
1. The decoy effect. This occurs when someone believes they have two options, but you present a third option to make the second one feel more palatable. For example, you visit a car lot to consider two cars, one listed for $30,000 and the other for $40,000. At first, the $40,000 car seems expensive, so the salesman shows you a $65,000 car. Suddenly, the $40,000 car seems reasonable by comparison. This salesman is preying on your decoy bias—the decoy being the $65,000 car that he knows you won’t buy.
2. Affect heuristic. Affect heuristic is the human tendency to base our decisions on our emotions. For example, take a study conducted at Shukutoku University, Japan. Participants judged a disease that killed 1,286 people out of every 10,000 as being more dangerous than one that was 24.14% fatal (despite this representing twice as many deaths). People reacted emotionally to the image of 1,286 people dying, whereas the percentage didn’t arouse the same mental imagery and emotions.
3. Fundamental attribution error. This is the tendency to attribute situational behavior to a person’s fixed personality. For example, people often attribute poor work performance to laziness when there are so many other possible explanations. It could be the individual in question is receiving projects they aren’t passionate about, their rocky home life is carrying over to their work life, or they’re burnt out. 4. The ideometer effect. This refers to the fact that our thoughts can make us feel real emotions. This is why actors envision terrible scenarios, such as the death of a loved one, in order to make themselves cry on cue and activities such as cataloging what you’re grateful for can have such a profound, positive impact on your wellbeing.
5. Confirmation bias. Confirmation bias is the tendency to seek out information that supports our pre-existing beliefs. In other words, we form an opinion first and then seek out evidence to back it up, rather than basing our opinions on facts.
6. Conservatism bias. This bias leads people to believe that pre-existing information takes precedence over new information. Don’t be quick to reject something just because it’s radical or different. Great ideas usually are. 7. The ostrich effect. The ostrich effect is aptly named after the fact that ostriches, when scared, literally bury their heads in the ground. This effect describes our tendency to hide from impending problems. We may not physically bury our heads in the ground, but we might as well. For example, if your company is experiencing layoffs, you’re having relationship issues, or you receive negative feedback, it’s common to attempt to push all these problems away, rather than to face them head on. This doesn’t work and simply delays the inevitable.
8. Reactance. Reactance is our tendency to react to rules and regulations by exercising our freedom. A prevalent example of this is children with overbearing parents. Tell a teenager to do what you say because you told them so, and they’re very likely to start breaking your rules. Similarly, employees who feel mistreated or “Big Brothered” by their employers are more likely to take longer breaks, extra sick days, or even steal from their company.
9. The halo effect. The halo effect occurs when someone creates a strong first impression and that impression sticks. This is extremely noticeable in grading. For example, often teachers grade a student’s first paper, and if it’s good, are prone to continue giving them high marks on future papers even if their performance doesn’t warrant it. The same thing happens at work and in personal relationships. 10. The horn effect. This effect is the exact opposite of the halo effect. When you perform poorly at first, you can easily get pegged as a low-performer even if you work hard enough to disprove that notion.
11. Planning fallacy. Planning fallacy is the tendency to think that we can do things more quickly than we actually can. For procrastinators, this leads to incomplete work, and this makes type-As overpromise and underdeliver.
12. The bandwagon effect. The bandwagon effect is the tendency to do what everyone else is doing. This creates a kind of groupthink, where people run with the first idea that’s put onto the table instead of exploring a variety of options. The bandwagon effect illustrates how we like to make decisions based on what feels good (doing what everyone else is doing), even if they’re poor alternatives. 13. Bias blind spot. If you begin to feel that you’ve mastered your biases, keep in mind that you’re most likely experiencing the bias blind spot. This is the tendency to see biases in other people but not in yourself. Bringing It All Together
Recognizing and understanding bias is invaluable because it enables you to think more objectively and to interact more effectively with other people.
Which of these biases have you experienced? Please share your thoughts in the comments section below, as I learn just as much from you as you do from me.
Dr. Travis BradberryAuthor of #1 bestselling book, Emotional Intelligence 2.0, and president of TalentSmart, world’s leading provider of emotional intelligence.
What to watch out for these retail strategies when shopping this holiday season.
This year is shaping up to be a bumper year for retail. The National Retail Federation, the industry group representing retailers, said last month that it expects sales in all of November and December — excluding autos, gas and restaurant sales — to hit $655.8 billion this year, including non-store sales of $105 billion. America had its biggest online shopping day ever on Cyber Monday with $3.39 billion in sales, and that’s in addition to the $5 billion spent online on both Thanksgiving Day and Black Friday. Shoppers are bombarded by tricks worthy of a magician when they walk into a store and, some at least, are growing wise to them.
To avoid overspending, there are some rules of what not to do, says marketing consultant Martin Lindstrom, author of the book “Brandwashed: Tricks Companies Use to Manipulate Our Minds and Persuade Us to Buy.” Rule No. 1: “Don’t bring your kids with you,” he says. They’ll help you spend 29% more than your budget, according to a study of nearly 3,000 consumers Lindstrom carried out. No. 2: “Don’t shop with your partner,” he says. He or she will make you spend 19% more than planned. No. 3: “Don’t use a shopping cart. People who carry their stuff spend 8% less.” No. 4: Carry $100 bills. “People are far less likely to want to break bigger notes,” he says.
People like to believe they’re getting a good deal, experts say, even if they doubt stores are being honest about the original retail price. But we don’t always know that we’re being manipulated, especially when navigating crowded malls. — By Quentin Fottrell
They treat you like a long lost friend
Graphic designer Daniel Drenger had an odd experience when he went to a J. Crew in New York two weeks ago to buy a pair of skinny jeans. “I wasn’t sure if the pants would get tighter after they were washed,” he says. “Out of the blue, the sales clerk told me his father was a cyclist and had large thighs, and had a problem finding jeans that fit.” Drenger was taken aback, but the story amused him and put him at ease — as if he were getting advice from a friend. After more sharing by the sales clerk, “I bought five pairs of jeans in different colors — and a bunch of other stuff too,” he says. (He decided to return half the loot a week later.) “Customers want more meaningful experiences,” Daye says. The overly-friendly staff at perfume counters are trying to fulfill that desire, he says.
They sell you a reusable bag, featuring the store’s logo
Why not send a message that your company cares about the environment and — at the same time — ensure customers hit the stores armed with an empty bag? Ikea, Wal-Mart WMT, +0.60% and Whole Foods WFM, -0.85% are among the many retailers that offer reusable shopping bags. They sometimes even bear the company’s logo, providing free advertising for the store. (Ikea’s blue bags are instantly recognizable even without a logo.) But mainly the bags create a void that needs to be filled, encouraging consumers to buy more than they need, says Johan Stenebo, author of the book “The Truth About Ikea.” “There’s a reason why they’re so big,” he says. (Ikea, Wal-Mart and Whole Foods did not respond to requests for comment.)
They give you a place to put your feet up
Some stores are even more thoughtful: They provide a path through the store punctuated with relaxing spaces for weary shoppers to rest their feet. Don’t loiter too long though: These rest areas are often placed next to displays of products that stores want to unload, says Stenebo, who worked at Ikea from 1988 to 2008 in a variety of roles from product development to management, and is also the former assistant to the group’s 90-year-old billionaire founder Ingvar Kamprad. “Retailers call this the hot-hot-hot spot for inventory that’s not shifting,” he says. That said, Ikea is a destination store usually situated on the outskirts of a city, and not a department store where people pop into for five or 10 minutes while running errands.
They offer comparatively pricey luxury items
The “compromise price effect” is most often used by discount retailers and electronics stores that want customers to pay extra for a better camera or computer, says Michelle Barnhart, associate professor of marketing at Oregon State University College of Business. Here’s how it works: If a $225 Polo Ralph Lauren down winter jacket is strategically placed next to a slightly cheaper — but very similar — $195 jacket by Kenneth Cole, the customer might be tempted to opt for the latter and walk away still believing that he or she got a good deal. The “compromise price effect” can be effective in a store or even online, she says.
They price everything one cent short of a whole number
Nobody believes they’ll be persuaded to buy something simply because it’s priced $9.99 instead of $10, but studies say otherwise. It’s called the “left-digit effect.” The difference of one cent can turn a window shopper into an actual shopper, according to a 2009 study by researchers at Colorado State University and Washington State University, published in the Journal of Consumer Research. In one test, the researchers asked participants to evaluate two identical pens: They priced one at $2.00 and the other $3.99 — amazingly, 44% of the participants chose the higher-priced pen.
They offer to solve your life problems
The influence of the Apple Store AAPL, -0.05% can be seen in other electronic outlets from Best Buy to Microsoft MSFT, -0.45% Apple Store employees are not paid on commission and they often remind shoppers of that fact, says Carmine Gallo, author of “The Apple Experience: Secrets to Building Insanely Great Customer Loyalty.” Apple’s “genius bar” is a team of sales people designed to solve problems and empower the customer rather than (just) make sales, he says. It’s been paying off: There are roughly more than 500 million visits to Apple retail stores per year, according to market researcher Asymco; that’s roughly equivalent to the population of the European Union. (Apple did not respond to requests for comment.)
They offer free shipping
Even retail pros fall for this: Free shipping is rarely offered without strings. Instead, stores set a threshold for each purchase, encouraging you to buy more. And they move that threshold depending on demand, says Brent Shelton, spokesman for deal site FatWallet. “I catch myself looking for more items to qualify all the time,” Shelton says. “I tell myself, ‘There’s got to be something that I need.’ It’s pretty rare that my shopping will be exactly $35 or $59.” Walmart.com WMT, +0.04% offers free shipping on orders over $50, but Target TGT, -0.27% offers free shipping on all purchases on every purchase through to Jan. 1, 2017. Amazon AMZN, -0.09% offers free shipping on orders of books of $25 and over, and all orders of $45 and over, plus free two-day shipping for all orders for Amazon Prime customers, which costs $99 per year.
They use cheap items as the thin end of the wedge
Beware of half-priced socks, chocolates or bags of tea lights positioned next to the entrance. They are designed to break a psychological barrier and get consumers shopping, independent retail consultant Jeff Green. In retail parlance, they’re “open-the-wallet” items and they often appear as an elaborate and random display. Displays could include everything from plastic to-go cups to tea-and-cookie gift bags. U.S. retailers have also taken the “open-the-wallet” concept to a whole new level by promoting cheap stuff in October in the hope that people will keep shopping in November and December. “Americans are cautious,” Green says, so they need a little extra push to get them in the mood to spend money.
They turn deal-hunting into a game
There’s a reason a minimalist design works at the Apple Store, but turns off regular shoppers in a store like J.C. Penney JCP, -0.20% Three years ago, J.C. Penney replaced CEO Ron Johnson — who had previously been senior vice president of Apple’s retail operations — with former J.C. Penney CEO Mike Ullman (who was replaced by current CEO Marvin Ellison). Apple sells luxury gadgets and rarely discounts its prices, while J.C. Penney is a promotional store where people enjoy the voyage the bottom of the bargain basement, Shelton says. “Big box department stores make you dig around and see what’s on sale,” he says. “People feel like they’re on a treasure hunt and finding a bargain that someone else missed.” (J.C. Penney did not respond to requests for comment.)
They pile on the accessories
Buying toys for kids can be a gift that keeps on giving: Batteries are often not included and — as Barbie might tell you if she could — dolls are more fun with a range of accessories. The same goes for adult toys, Shelton says. Case in point: The battery life of Apple’s iPhones has long been a bugbear for Apple fans. But customers still complain about the impact of apps and downloads on the phone’s battery life. One solution: Apples sells a Mophie Juice Pack Plus charger case ($120), which doubles the time to talk, text and surf the Web. Retailers are like Lieutenant Columbo, Shelton says, “There will always be ‘Just one more thing.’”
Online shopping giant Amazon rolled out Amazon Go on Monday, enabling customers to walk into its Seattle-based grocery store, grab whatever they want and leave.
The store uses deep learning technology, sensors and computer vision to keep track of what you take off and place back on the shelves. It’s similar to the kind of technology used in self-driving cars.
To start shopping, you use a free app to scan yourself in when you enter the store.
The app keeps a running tab of what you pull off the shelves. Shortly after you leave, Amazon will charge your account for the items and send you a receipt.
At the moment, Amazon Go seems more like a corner store or convenience store than a full-fledged grocery store. It offers an array of ready-to-eat, grab-and-go meals prepared by Amazon Go’s staff, plus items such as bread, cheese, milk and chocolate. It also sells Amazon Meal Kits, which include ingredients to cook a meal for two at home in under 30 minutes.
The store is currently in its beta phase, and only Amazon employees can shop there for the time being. It will open to the public in early 2017.
Amazon Go seems to be the next step in Amazon’s quest to expand its influence in the grocery business, as well as its brick and mortar presence. In 2007, the company rolled out the grocery delivery service Amazon Fresh, and in 2015, it opened a physical bookstore.
Here’s what you don’t want to do late on a Sunday night. You do not want to type seven letters into Google. That’s all I did. I typed: “a-r-e”. And then “j-e-w-s”. Since 2008, Google has attempted to predict what question you might be asking and offers you a choice. And this is what it did. It offered me a choice of potential questions it thought I might want to ask: “are jews a race?”, “are jews white?”, “are jews christians?”, and finally, “are jews evil?”
Are Jews evil? It’s not a question I’ve ever thought of asking. I hadn’t gone looking for it. But there it was. I press enter. A page of results appears. This was Google’s question. And this was Google’s answer: Jews are evil. Because there, on my screen, was the proof: an entire page of results, nine out of 10 of which “confirm” this. The top result, from a site called Listovative, has the headline: “Top 10 Major Reasons Why People Hate Jews.” I click on it: “Jews today have taken over marketing, militia, medicinal, technological, media, industrial, cinema challenges etc and continue to face the worlds [sic] envy through unexplained success stories given their inglorious past and vermin like repression all over Europe.”
Google is search. It’s the verb, to Google. It’s what we all do, all the time, whenever we want to know anything. We Google it. The site handles at least 63,000 searches a second, 5.5bn a day. Its mission as a company, the one-line overview that has informed the company since its foundation and is still the banner headline on its corporate website today, is to “organise the world’s information and make it universally accessible and useful”. It strives to give you the best, most relevant results. And in this instance the third-best, most relevant result to the search query “are Jews… ” is a link to an article from stormfront.org, a neo-Nazi website. The fifth is a YouTube video: “Why the Jews are Evil. Why we are against them.”
The sixth is from Yahoo Answers: “Why are Jews so evil?” The seventh result is: “Jews are demonic souls from a different world.” And the 10th is from jesus-is-saviour.com: “Judaism is Satanic!”
There’s one result in the 10 that offers a different point of view. It’s a link to a rather dense, scholarly book review from thetabletmag.com, a Jewish magazine, with the unfortunately misleading headline: “Why Literally Everybody In the World Hates Jews.”
I feel like I’ve fallen down a wormhole, entered some parallel universe where black is white, and good is bad. Though later, I think that perhaps what I’ve actually done is scraped the topsoil off the surface of 2016 and found one of the underground springs that has been quietly nurturing it. It’s been there all the time, of course. Just a few keystrokes away… on our laptops, our tablets, our phones. This isn’t a secret Nazi cell lurking in the shadows. It’s hiding in plain sight.
Stories about fake news on Facebook have dominated certain sections of the press for weeks following the American presidential election, but arguably this is even more powerful, more insidious. Frank Pasquale, professor of law at the University of Maryland, and one of the leading academic figures calling for tech companies to be more open and transparent, calls the results “very profound, very troubling”.
He came across a similar instance in 2006 when, “If you typed ‘Jew’ in Google, the first result was jewwatch.org. It was ‘look out for these awful Jews who are ruining your life’. And the Anti-Defamation League went after them and so they put an asterisk next to it which said: ‘These search results may be disturbing but this is an automated process.’ But what you’re showing – and I’m very glad you are documenting it and screenshotting it – is that despite the fact they have vastly researched this problem, it has gotten vastly worse.”
And ordering of search results does influence people, says Martin Moore, director of the Centre for the Study of Media, Communication and Power at King’s College, London, who has written at length on the impact of the big tech companies on our civic and political spheres. “There’s large-scale, statistically significant research into the impact of search results on political views. And the way in which you see the results and the types of results you see on the page necessarily has an impact on your perspective.” Fake news, he says, has simply “revealed a much bigger problem. These companies are so powerful and so committed to disruption. They thought they were disrupting politics but in a positive way. They hadn’t thought about the downsides. These tools offer remarkable empowerment, but there’s a dark side to it. It enables people to do very cynical, damaging things.”
Google is knowledge. It’s where you go to find things out. And evil Jews are just the start of it. There are also evil women. I didn’t go looking for them either. This is what I type: “a-r-e w-o-m-e-n”. And Google offers me just two choices, the first of which is: “Are women evil?” I press return. Yes, they are. Every one of the 10 results “confirms” that they are, including the top one, from a site called sheddingoftheego.com, which is boxed out and highlighted: “Every woman has some degree of prostitute in her. Every woman has a little evil in her… Women don’t love men, they love what they can do for them. It is within reason to say women feel attraction but they cannot love men.”
Next I type: “a-r-e m-u-s-l-i-m-s”. And Google suggests I should ask: “Are Muslims bad?” And here’s what I find out: yes, they are. That’s what the top result says and six of the others. Without typing anything else, simply putting the cursor in the search box, Google offers me two new searches and I go for the first, “Islam is bad for society”. In the next list of suggestions, I’m offered: “Islam must be destroyed.”
Jews are evil. Muslims need to be eradicated. And Hitler? Do you want to know about Hitler? Let’s Google it. “Was Hitler bad?” I type. And here’s Google’s top result: “10 Reasons Why Hitler Was One Of The Good Guys” I click on the link: “He never wanted to kill any Jews”; “he cared about conditions for Jews in the work camps”; “he implemented social and cultural reform.” Eight out of the other 10 search results agree: Hitler really wasn’t that bad.
A few days later, I talk to Danny Sullivan, the founding editor of SearchEngineLand.com. He’s been recommended to me by several academics as one of the most knowledgeable experts on search. Am I just being naive, I ask him? Should I have known this was out there? “No, you’re not being naive,” he says. “This is awful. It’s horrible. It’s the equivalent of going into a library and asking a librarian about Judaism and being handed 10 books of hate. Google is doing a horrible, horrible job of delivering answers here. It can and should do better.”
He’s surprised too. “I thought they stopped offering autocomplete suggestions for religions in 2011.” And then he types “are women” into his own computer. “Good lord! That answer at the top. It’s a featured result. It’s called a “direct answer”. This is supposed to be indisputable. It’s Google’s highest endorsement.” That every women has some degree of prostitute in her? “Yes. This is Google’s algorithm going terribly wrong.”
I contacted Google about its seemingly malfunctioning autocomplete suggestions and received the following response: “Our search results are a reflection of the content across the web. This means that sometimes unpleasant portrayals of sensitive subject matter online can affect what search results appear for a given query. These results don’t reflect Google’s own opinions or beliefs – as a company, we strongly value a diversity of perspectives, ideas and cultures.”
Google isn’t just a search engine, of course. Search was the foundation of the company but that was just the beginning. Alphabet, Google’s parent company, now has the greatest concentration of artificial intelligence experts in the world. It is expanding into healthcare, transportation, energy. It’s able to attract the world’s top computer scientists, physicists and engineers. It’s bought hundreds of start-ups, including Calico, whose stated mission is to “cure death” and DeepMind, which aims to “solve intelligence”.
And 20 years ago it didn’t even exist. When Tony Blair became prime minister, it wasn’t possible to Google him: the search engine had yet to be invented. The company was only founded in 1998 and Facebook didn’t appear until 2004. Google’s founders Sergey Brin and Larry Page are still only 43. Mark Zuckerberg of Facebook is 32. Everything they’ve done, the world they’ve remade, has been done in the blink of an eye.
But it seems the implications about the power and reach of these companies is only now seeping into the public consciousness. I ask Rebecca MacKinnon, director of the Ranking Digital Rights project at the New America Foundation, whether it was the recent furore over fake news that woke people up to the danger of ceding our rights as citizens to corporations. “It’s kind of weird right now,” she says, “because people are finally saying, ‘Gee, Facebook and Google really have a lot of power’ like it’s this big revelation. And it’s like, ‘D’oh.’”
MacKinnon has a particular expertise in how authoritarian governments adapt to the internet and bend it to their purposes. “China and Russia are a cautionary tale for us. I think what happens is that it goes back and forth. So during the Arab spring, it seemed like the good guys were further ahead. And now it seems like the bad guys are. Pro-democracy activists are using the internet more than ever but at the same time, the adversary has gotten so much more skilled.”
Last week Jonathan Albright, an assistant professor of communications at Elon University in North Carolina, published the first detailed research on how rightwing websites had spread their message. “I took a list of these fake news sites that was circulating, I had an initial list of 306 of them and I used a tool – like the one Google uses – to scrape them for links and then I mapped them. So I looked at where the links went – into YouTube and Facebook, and between each other, millions of them… and I just couldn’t believe what I was seeing.
“They have created a web that is bleeding through on to our web. This isn’t a conspiracy. There isn’t one person who’s created this. It’s a vast system of hundreds of different sites that are using all the same tricks that all websites use. They’re sending out thousands of links to other sites and together this has created a vast satellite system of rightwing news and propaganda that has completely surrounded the mainstream media system.
He found 23,000 pages and 1.3m hyperlinks. “And Facebook is just the amplification device. When you look at it in 3D, it actually looks like a virus. And Facebook was just one of the hosts for the virus that helps it spread faster. You can see the New York Times in there and the Washington Post and then you can see how there’s a vast, vast network surrounding them. The best way of describing it is as an ecosystem. This really goes way beyond individual sites or individual stories. What this map shows is the distribution network and you can see that it’s surrounding and actually choking the mainstream news ecosystem.”
Like a cancer? “Like an organism that is growing and getting stronger all the time.”
Charlie Beckett, a professor in the school of media and communications at LSE, tells me: “We’ve been arguing for some time now that plurality of news media is good. Diversity is good. Critiquing the mainstream media is good. But now… it’s gone wildly out of control. What Jonathan Albright’s research has shown is that this isn’t a byproduct of the internet. And it’s not even being done for commercial reasons. It’s motivated by ideology, by people who are quite deliberately trying to destabilise the internet.”
Albright’s map also provides a clue to understanding the Google search results I found. What these rightwing news sites have done, he explains, is what most commercial websites try to do. They try to find the tricks that will move them up Google’s PageRank system. They try and “game” the algorithm. And what his map shows is how well they’re doing that.
That’s what my searches are showing too. That the right has colonised the digital space around these subjects – Muslims, women, Jews, the Holocaust, black people – far more effectively than the liberal left.
“It’s an information war,” says Albright. “That’s what I keep coming back to.”
But it’s where it goes from here that’s truly frightening. I ask him how it can be stopped. “I don’t know. I’m not sure it can be. It’s a network. It’s far more powerful than any one actor.”
So, it’s almost got a life of its own? “Yes, and it’s learning. Every day, it’s getting stronger.”
The more people who search for information about Jews, the more people will see links to hate sites, and the more they click on those links (very few people click on to the second page of results) the more traffic the sites will get, the more links they will accrue and the more authoritative they will appear. This is an entirely circular knowledge economy that has only one outcome: an amplification of the message. Jews are evil. Women are evil. Islam must be destroyed. Hitler was one of the good guys.
And the constellation of websites that Albright found – a sort of shadow internet – has another function. More than just spreading rightwing ideology, they are being used to track and monitor and influence anyone who comes across their content. “I scraped the trackers on these sites and I was absolutely dumbfounded. Every time someone likes one of these posts on Facebook or visits one of these websites, the scripts are then following you around the web. And this enables data-mining and influencing companies like Cambridge Analytica to precisely target individuals, to follow them around the web, and to send them highly personalised political messages. This is a propaganda machine. It’s targeting people individually to recruit them to an idea. It’s a level of social engineering that I’ve never seen before. They’re capturing people and then keeping them on an emotional leash and never letting them go.”
Cambridge Analytica, an American-owned company based in London, was employed by both the Vote Leave campaign and the Trump campaign. Dominic Cummings, the campaign director of Vote Leave, has made few public announcements since the Brexit referendum but he did say this: “If you want to make big improvements in communication, my advice is – hire physicists.”
Steve Bannon, founder of Breitbart News and the newly appointed chief strategist to Trump, is on Cambridge Analytica’s board and it has emerged that the company is in talks to undertake political messaging work for the Trump administration. It claims to have built psychological profiles using 5,000 separate pieces of data on 220 million American voters. It knows their quirks and nuances and daily habits and can target them individually.
“They were using 40-50,000 different variants of ad every day that were continuously measuring responses and then adapting and evolving based on that response,” says Martin Moore of Kings College. Because they have so much data on individuals and they use such phenomenally powerful distribution networks, they allow campaigns to bypass a lot of existing laws.
“It’s all done completely opaquely and they can spend as much money as they like on particular locations because you can focus on a five-mile radius or even a single demographic. Fake news is important but it’s only one part of it. These companies have found a way of transgressing 150 years of legislation that we’ve developed to make elections fair and open.”
Did such micro-targeted propaganda – currently legal – swing the Brexit vote? We have no way of knowing. Did the same methods used by Cambridge Analytica help Trump to victory? Again, we have no way of knowing. This is all happening in complete darkness. We have no way of knowing how our personal data is being mined and used to influence us. We don’t realise that the Facebook page we are looking at, the Google page, the ads that we are seeing, the search results we are using, are all being personalised to us. We don’t see it because we have nothing to compare it to. And it is not being monitored or recorded. It is not being regulated. We are inside a machine and we simply have no way of seeing the controls. Most of the time, we don’t even realise that there are controls.
Rebecca MacKinnon says that most of us consider the internet to be like “the air that we breathe and the water that we drink”. It surrounds us. We use it. And we don’t question it. “But this is not a natural landscape. Programmers and executives and editors and designers, they make this landscape. They are human beings and they all make choices.”
But we don’t know what choices they are making. Neither Google or Facebook make their algorithms public. Why did my Google search return nine out of 10 search results that claim Jews are evil? We don’t know and we have no way of knowing. Their systems are what Frank Pasquale describes as “black boxes”. He calls Google and Facebook “a terrifying duopoly of power” and has been leading a growing movement of academics who are calling for “algorithmic accountability”. “We need to have regular audits of these systems,” he says. “We need people in these companies to be accountable. In the US, under the Digital Millennium Copyright Act, every company has to have a spokesman you can reach. And this is what needs to happen. They need to respond to complaints about hate speech, about bias.”
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Is bias built into the system? Does it affect the kind of results that I was seeing? “There’s all sorts of bias about what counts as a legitimate source of information and how that’s weighted. There’s enormous commercial bias. And when you look at the personnel, they are young, white and perhaps Asian, but not black or Hispanic and they are overwhelmingly men. The worldview of young wealthy white men informs all these judgments.”
Later, I speak to Robert Epstein, a research psychologist at the American Institute for Behavioural Research and Technology, and the author of the study that Martin Moore told me about (and that Google has publicly criticised), showing how search-rank results affect voting patterns. On the other end of the phone, he repeats one of the searches I did. He types “do blacks…” into Google.
“Look at that. I haven’t even hit a button and it’s automatically populated the page with answers to the query: ‘Do blacks commit more crimes?’ And look, I could have been going to ask all sorts of questions. ‘Do blacks excel at sports’, or anything. And it’s only given me two choices and these aren’t simply search-based or the most searched terms right now. Google used to use that but now they use an algorithm that looks at other things. Now, let me look at Bing and Yahoo. I’m on Yahoo and I have 10 suggestions, not one of which is ‘Do black people commit more crime?’
“And people don’t question this. Google isn’t just offering a suggestion. This is a negative suggestion and we know that negative suggestions depending on lots of things can draw between five and 15 more clicks. And this all programmed. And it could be programmed differently.”
What Epstein’s work has shown is that the contents of a page of search results can influence people’s views and opinions. The type and order of search rankings was shown to influence voters in India in double-blind trials. There were similar results relating to the search suggestions you are offered.
“The general public are completely in the dark about very fundamental issues regarding online search and influence. We are talking about the most powerful mind-control machine ever invented in the history of the human race. And people don’t even notice it.”
Damien Tambini, an associate professor at the London School of Economics, who focuses on media regulation, says that we lack any sort of framework to deal with the potential impact of these companies on the democratic process. “We have structures that deal with powerful media corporations. We have competition laws. But these companies are not being held responsible. There are no powers to get Google or Facebook to disclose anything. There’s an editorial function to Google and Facebook but it’s being done by sophisticated algorithms. They say it’s machines not editors. But that’s simply a mechanised editorial function.”
And the companies, says John Naughton, the Observer columnist and a senior research fellow at Cambridge University, are terrified of acquiring editorial responsibilities they don’t want. “Though they can and regularly do tweak the results in all sorts of ways.”
Certainly the results about Google on Google don’t seem entirely neutral. Google “Is Google racist?” and the featured result – the Google answer boxed out at the top of the page – is quite clear: no. It is not.
But the enormity and complexity of having two global companies of a kind we have never seen before influencing so many areas of our lives is such, says Naughton, that “we don’t even have the mental apparatus to even know what the problems are”.
And this is especially true of the future. Google and Facebook are at the forefront of AI. They are going to own the future. And the rest of us can barely start to frame the sorts of questions we ought to be asking. “Politicians don’t think long term. And corporations don’t think long term because they’re focused on the next quarterly results and that’s what makes Google and Facebook interesting and different. They are absolutely thinking long term. They have the resources, the money, and the ambition to do whatever they want.
“They want to digitise every book in the world: they do it. They want to build a self-driving car: they do it. The fact that people are reading about these fake news stories and realising that this could have an effect on politics and elections, it’s like, ‘Which planet have you been living on?’ For Christ’s sake, this is obvious.”
“The internet is among the few things that humans have built that they don’t understand.” It is “the largest experiment involving anarchy in history. Hundreds of millions of people are, each minute, creating and consuming an untold amount of digital content in an online world that is not truly bound by terrestrial laws.” The internet as a lawless anarchic state? A massive human experiment with no checks and balances and untold potential consequences? What kind of digital doom-mongerer would say such a thing? Step forward, Eric Schmidt – Google’s chairman. They are the first lines of the book, The New Digital Age, that he wrote with Jared Cohen.
We don’t understand it. It is not bound by terrestrial laws. And it’s in the hands of two massive, all-powerful corporations. It’s their experiment, not ours. The technology that was supposed to set us free may well have helped Trump to power, or covertly helped swing votes for Brexit. It has created a vast network of propaganda that has encroached like a cancer across the entire internet. This is a technology that has enabled the likes of Cambridge Analytica to create political messages uniquely tailored to you. They understand your emotional responses and how to trigger them. They know your likes, dislikes, where you live, what you eat, what makes you laugh, what makes you cry.
And what next? Rebecca MacKinnon’s research has shown how authoritarian regimes reshape the internet for their own purposes. Is that what’s going to happen with Silicon Valley and Trump? As Martin Moore points out, the president-elect claimed that Apple chief executive Tim Cook called to congratulate him soon after his election victory. “And there will undoubtedly be be pressure on them to collaborate,” says Moore.
Journalism is failing in the face of such change and is only going to fail further. New platforms have put a bomb under the financial model – advertising – resources are shrinking, traffic is increasingly dependent on them, and publishers have no access, no insight at all, into what these platforms are doing in their headquarters, their labs. And now they are moving beyond the digital world into the physical. The next frontiers are healthcare, transportation, energy. And just as Google is a near-monopoly for search, its ambition to own and control the physical infrastructure of our lives is what’s coming next. It already owns our data and with it our identity. What will it mean when it moves into all the other areas of our lives?
“At the moment, there’s a distance when you Google ‘Jews are’ and get ‘Jews are evil’,” says Julia Powles, a researcher at Cambridge on technology and law. “But when you move into the physical realm, and these concepts become part of the tools being deployed when you navigate around your city or influence how people are employed, I think that has really pernicious consequences.”
Powles is shortly to publish a paper looking at DeepMind’s relationship with the NHS. “A year ago, 2 million Londoners’ NHS health records were handed over to DeepMind. And there was complete silence from politicians, from regulators, from anyone in a position of power. This is a company without any healthcare experience being given unprecedented access into the NHS and it took seven months to even know that they had the data. And that took investigative journalism to find it out.”
The headline was that DeepMind was going to work with the NHS to develop an app that would provide early warning for sufferers of kidney disease. And it is, but DeepMind’s ambitions – “to solve intelligence” – goes way beyond that. The entire history of 2 million NHS patients is, for artificial intelligence researchers, a treasure trove. And, their entry into the NHS – providing useful services in exchange for our personal data – is another massive step in their power and influence in every part of our lives.
Because the stage beyond search is prediction. Google wants to know what you want before you know yourself. “That’s the next stage,” says Martin Moore. “We talk about the omniscience of these tech giants, but that omniscience takes a huge step forward again if they are able to predict. And that’s where they want to go. To predict diseases in health. It’s really, really problematic.”
For the nearly 20 years that Google has been in existence, our view of the company has been inflected by the youth and liberal outlook of its founders. Ditto Facebook, whose mission, Zuckberg said, was not to be “a company. It was built to accomplish a social mission to make the world more open and connected.”
It would be interesting to know how he thinks that’s working out. Donald Trump is connecting through exactly the same technology platforms that supposedly helped fuel the Arab spring; connecting to racists and xenophobes. And Facebook and Google are amplifying and spreading that message. And us too – the mainstream media. Our outrage is just another node on Jonathan Albright’s data map.
“The more we argue with them, the more they know about us,” he says. “It all feeds into a circular system. What we’re seeing here is new era of network propaganda.”
We are all points on that map. And our complicity, our credulity, being consumers not concerned citizens, is an essential part of that process. And what happens next is down to us. “I would say that everybody has been really naive and we need to reset ourselves to a much more cynical place and proceed on that basis,” is Rebecca MacKinnon’s advice. “There is no doubt that where we are now is a very bad place. But it’s we as a society who have jointly created this problem. And if we want to get to a better place, when it comes to having an information ecosystem that serves human rights and democracy instead of destroying it, we have to share responsibility for that.”
Are Jews evil? How do you want that question answered? This is our internet. Not Google’s. Not Facebook’s. Not rightwing propagandists. And we’re the only ones who can reclaim it.
When I lost my job three years ago, one friend proved to be my touchstone and sanity refuge. Like me, she was a former high earner dealing with a major work gap and an unstable income. We used to play this crazy game called “Top This” to get relief from the stress.
I would share that my cell phone was about to be disconnected for nonpayment. She would counter that her water had been turned off. It was the crisis sweepstakes. The person with the worst situation won.
I know, it sounds moribund. But in some of the worst moments, it made all the difference. Our friendship was one of very few places I could go without feeling I had to “fake normal” or pretend I was all right.
This friend, a few others and my mother and daughter were the line in the sand between the abyss and me. I was still broke, but how I held being broke had changed. And that allowed me to take my first steps back from the abyss.
If you’re a fellow faking-normal traveler — unemployed, over 50 and feeling at sea (like Brandon and Zoe were below) —I suggest you start what I call a “Resilience Circle.” Finding my tribe and being part of a supportive community has been critical to my sense of well-being and key to my ability to choose what’s right for me and to act on my own behalf. And I believe it could be for you, too.
Creating Your Resilience Circle
You likely already know one person among your friends and friendly acquaintances who is faking it, and that person likely knows another, and so on. That’s enough to begin.
Approach that person. Tell him or her that you’d like to start a small Resilience Circle to support each other and to discuss issues related to aging and living a good life on a limited income.
Don’t make the group too big. You will be sharing personal information and don’t need a cast of thousands for that (what’s said at the meetings should be kept confidential). Between eight and ten people is probably enough. But you can hold meetings even if your Resilience Circle consists of just you and two or three others at the beginning.
Keep the logistics simple. Meet in someone’s home or in the library. Make it cheap. Don’t go overboard with the refreshments — or serve no food or drinks at all.
Plan on holding meetings for three or four months and appoint a group leader or moderator to keep the discussions on track.
Reflection is a key part of Resilience Circle gatherings. Each person should start by talking about two big things in their lives they wish they’d done differently and that negatively affected their finances. A question for the group: What do you know now that you didn’t consider then? (Each chapter of the book has a set of reflection questions like these to facilitate Resilience Circle discussions.)
When I met with Zoe for the book, she was 62 and had $31 to her name…literally. And I had never seen her happier or more grounded. Yes, she had landed a new client and money was in the pipeline, but she was still on food stamps and living in a one-bedroom rental in a Maryland suburb.
Her career, which had included international business travel, high-profile clients, testimony before Congress and a group Emmy, began to unravel during the Great Recession of 2007-09. The tanking economy happened on the heels of her divorce, delivering a one-two punch.
At 58, Zoe found that her work opportunities had all but dried up. Without clients, things spiraled out of control. “I was always digging out of a hole. When a check did finally come, I’d need it, and more, to pay back bills,” she told me.
Meanwhile, she was still trying to play the part. That meant saying Yes when colleagues got together for nightcaps or picking up the dinner tab with a potential client. “Of course, no one ever suggested TGI Friday’s, Ruby Tuesday’s or Olive Garden,” she said, laughing. It was always the chicest D.C. watering holes, where one drink and a couple of ‘small’ plates would easily run you $50 and up. In those days, I was afraid to say no.”
By spring 2013, Zoe was three months behind on the payments for her 2,500-square-foot house in a tony D.C. suburb. So she packed up, rented a storage unit for her home’s contents and, with her college-aged daughter, moved in with family members in another city.
Those were the dark days. In Zoe’s eyes, the move broadcast failure. “I was in shock, embarrassed and lost. I cried all the time. My identity had been defined by the high-profile jobs and all my stuff,” she said.
Zoe said she’d never been tested the way she was being tested. She’d been humbled by the situation and out of this humility had come a kind of quiet that allowed her to access a part of herself that was not driven by status or money.
“I recommitted to those things I could control: daily meditation and yoga, exercise and diet. When you’re broke, you’re in a perpetual state of fear and panic. You’re always anticipating the worst. But an hour of yoga gives you a place of rest, and the rhythmic breathing clears everything. Your head and heart are clear enough to hear the still, quiet voice of God,” she told me.
Zoe also sought out ways to grow her business. One of her biggest finds was the Maryland Small Business Association, which offers assistance on everything from making business plans to creating effective websites. “Working with my business counselor gave me hope that I would work again,”she said. “I found that virtually all creditors will work with you if you tell them what’s going on. But you have to ask about programs for people facing hardships, because lots of times this information is not volunteered.”
Nowadays, she’s focused more on what she wants to do than on what others think she should be doing, saying: “I am building a casserole of work more aligned with my values.”
Zoe’s one-bedroom apartment is airy and bright and decorated with her favorite pieces from her old life. She recently landed a short-term contract that lets her pay the bills — with a little money to spare. Life is good, in a deeply satisfying way.
This is Brandon’s story, and advice, in his own words:
I was an account manager and thought I was working in the job I’d retire from. That is what I hoped for. But my former company didn’t care about my hopes or dreams. At 56, I was laid off, along with 40 colleagues.
I began applying for positions similar to the job I’d had. One of my former clients hired me to do day-to-day operations in his office for about one-third of my previous salary. I wasn’t surprised when it ended 18 months later.
My wife and grade-school-aged children had been doing all right before the layoff. Now my wife has found work in her longtime profession as a photographer, but our income is under strain. We’ve been able to get a great deal of help from my wife’s mother — providing a loan and buying some of the kids’ clothing. Without that, we’d be much worse off. If you can get help from your extended family, do not refuse it.
I continued applying for the same account manager/customer service work I knew, but it wasn’t working. I kept seeing the same phrase in carefully worded rejection e-mails: ‘We found other candidates for the position who would be a better fit. A better fit, as if I were a shoe that was too large or the organization was too large for my skills.
I presumed my rejections had to do with other factors: I was too experienced or too old. There was another problem with my job search — I wasn’t looking for work that I thought was beneath my experience and education. At a time when almost any income would’ve helped, I had no business not pursuing any kind of work. I needed to get down from that high horse.
To keep my head up, I networked and intensified my artistic work, which meant continuing to write poetry and short stories and making progress on a play I’d been writing. I also began using my phone’s camera in earnest and created a Tumblr site (Sonny Jam’s Place) where I uploaded poems, a few cuts of music and my photographs.
Eventually, the only things I uploaded were photographs. I traversed the city, capturing the murals of artists. I’d supply information about the muralists, with links to their sites. People liked the work, I enjoyed the “discoveries” and I stayed active. Eventually, I began to work on my own photographic images. I took so many photographs that I realized I had a collection and saw the potential for an exhibit. I still do.
After several more application rejections and interviews, I realized maybe I wasn’t going to find work as an account manager ever again. I adjusted my resumé, shortened it and made changes to interest certain employers. I changed my cover letter’s style and began pursuing different leads.
Then I got a call from a life coach who said she kept seeing my name on LinkedIn. She said I needed to figure out how my skills were transferable and how I might turn my experience down another path. She never asked for money and didn’t help me find a job, but she helped me shift my energy and reset my headspace.
Here are a few suggestions if your story is like mine:
Stay active. The depression that some of us may unknowingly develop after losing a job can be paralyzing.
Intensify or reinvigorate your sidelined artistic endeavors. Embrace your multi-talented self.
Keep a journal or several, each with a different purpose. I have a daily journal to get thoughts out of my head and a blank notebook for drawing. I also keep an everyday journal to keep track of what I did during the day. Without it, my days would blend into one another. You don’t want to lose track of your days.
Never accept anyone who thinks you’re old. Force the changes that you’ll need to move forward. The only things you should consider old are the ways you used to be.