Don’t get me wrong, I’m a fan of Web 2.0. I think it holds great potential for group collaboration, online participation, democratization of the means of creative production, and knowledge managment.
But I think this blogger (Joe McKendrick, in The Fast Forward Blog, a Hosted Discussion on Enterprise 2.0 ) has a case of ‘irrationally exuberant’ boosterism and pollyannishness when he wrote yesterday:
Any economic downturn has the potential to be reversed or mitigated by empowered employees or entrepreneurs who will be able to collaborate, share information and knowledge, and quickly respond to and act on new opportunities, thanks to our networked economy.
Sorry to rain on your parade, Joe, but that’s pretty ahistorical (and U.S.-centric). If, in economics, ‘a rising tide lifts all ships’, then the converse is also true, i.e.:
A stock market crash is going to sink Web 2.0 ships, just as surely as it sinks others. And you gotta be kidding if you think the Read/Write web could mitigate, no less reverse it.
An outgoing tide of prosperity might leave a lot of us extra time to blog about it (e.g., from your iPhone on a soup kitchen line). For a while. Until harsh cash flow considerations through the prism of Maslow’s hierarchy force us to hock our iPhones and cancel our broadband. Or our electricity gets cut off.
Increased productivity and communication due to the rollout and proliferation of electricity, the telephone and the radio in the 1920′s did nothing to prevent or mitigate the Great Depression of 1929. Small businesses then suffered and went out of business, just as small Web 2.0-enabled businesses in a 21st century depression would.
I hope a recession or depression doesn’t come. But “it can’t happen again” is wrong. And some cool new twists to the internets ain’t gonna stay the invisible hand of Adam Smith…
Hi Dan, thanks for the link. I agree that macro-events tend to be out of our individual control. What I’m saying is that with new technology tools, people no longer need to be powerless in the face of adverse events, as they once were.
If and when layoffs hit (and we all know we don’t need a recession for that), people have more options to drive their own fate, versus living on unemployment checks and hoping the company calls them back.
People can remain well-connected to their professional networks, and leverage tools and potential opportunities that have not been readily available in times gone by. If you want to try to start a new business, the Web offers an abundance of ideas and opportunities — and visibility across the globe. Not a lot of start-up capital is required. The Web is an incredible global tool at our disposal, for very minimal cost.
Yes, small businesses will fail, but many fail even in the best of times. But consider even Microsoft — founded in April 1975, at the tail end of the worst recession in a generation — didn’t have the kinds of tools at its disposal that we now have.
Hi Joe,
Thanks for the comment. But I still disagree on this one.
If a layoff is not caused by recession/depression (but rather by a single company or industry retrenching) then sure, for talented white collar knowledge workers, Web 2.0 tools (a la LinkedIn, Amazon Web Store & Services, etc.) will be helpful.
But if a depression or deep recession hits, even if your business idea requires little or no capital:
*Consumers won’t have extra cash to buy the clever non-essential item you’re selling on eBay or a web store.
*Companies will be retrenching and won’t be hiring consultants.
*The same problem (no one interested in buying your goods or services) will exist around the globe. (As a Chinese finance minister said yesterday in Davos, paraphrased, ‘when the U.S. sneezes, we still feel bad and get sick’.)
Only in an economy doing reasonably well would a rational person be “living on unemployment checks and hoping the company calls them back.” In past recessions and depressions and pre-internet, when you were laid off you hustled and took your fate in your hands: substitute teaching, selling dictionaries, taking odd jobs, becoming a migrant worker, doing something in the ‘grey’ economy, selling your writing, becoming a street vendor, working for the family business, driving a taxi, etc. etc.
[...] is a bit more pessimistic, and said my thinking was based on ‘irrationally exuberant’ boosterism and pollyannishness: “A stock market crash is going to sink Web 2.0 ships, just as surely as it sinks others. And [...]
[...] what I wrote in this blog in January 2008, in response to a blog article touting Web 2.0 as an antidote for economic recession: A stock [...]