Facebook, capitalism & repression

In its highly anticipated initial public offering (IPO), Facebook offered its stock to any investor for the first time on May 18. For weeks prior to the event, the capitalist press had sung the company’s praises and pushed its estimated value higher and higher.

Yet on the day of the IPO, it quickly became apparent that the frenzied hype was unjustified. The stock price quickly tanked, a computer glitch resulted in the loss of millions of dollars, and the entire affair was overtaken in scandal within days. Numerous media reports, investor lawsuits and state investigations have alleged that the IPO’s leading underwriters — Morgan Stanley, JP Morgan and Goldman Sachs — engaged in insider trading with favored investors. The insider trading was based on the underwriters’ internal (reduced) appraisal of the Facebook company.

However, the reasoning behind the reduced projections offers a deeper view of the social network as well as the interesting times in which we live. Facebook was famously started in a Harvard dorm by four classmates in 2004. It is now the world’s largest social network, with 901 million active users. For the Millennial generation (those born roughly from the mid-1970s to the late-1990s), the cultural significance of Facebook is difficult to overstate, but the social network has also absorbed a broad cross-section of the population in the wake of its rapid growth.

Political movements & social networking

Activists have used Facebook to great effect in their organizing. It has played a strong role in global movements over the last 18 months, from the Egyptian Revolution to Occupy Wall Street.

However, social networking is something of a double-edged sword for progressive movements. The state uses social networking websites for surveillance and even to promote destabilization of states unfriendly to U.S. imperialism — for example, by spreading disinformation about Iran and Syria via Twitter.

It is difficult to accept that these operations are conducted exclusively overseas, as the federal government claims. Within weeks of the Egyptian revolution in February 2011, the U.S. Senate Intelligence Committee angrily demanded why the intelligence services’ “open-source” mass-surveillance programs had failed to predict the uprising using its supercomputers and other advanced forecasting technology.

In some cases, this mass surveillance goes beyond scanning the public internet to monitoring private computers, such as the recent discovery of “Flame,” a complex spyware program that was in all likelihood invented by a capitalist government. The program infected at least 1,000 machines, mainly in Palestine and Iran, and self-destructed after its discovery.

In response to the recent upsurge of protest, the norms of ruling-class legality in respect to “free speech” in cyberspace and communications have increasingly fallen by the wayside. Last year the Bay Area Rapid Transit blocked cell phone reception in order to disrupt anti-cop protests. Meanwhile, British Prime Minister David Cameron demanded social media restriction in the wake of a youth revolt there.

Facebook & the capitalist state

What is generally suspected but less understood is Facebook’s relationship with the capitalist state and its intelligence operations. One of Facebook’s earlier investors was a venture capital firm named In-Q-Tel, whose website openly brags of its purpose to produce “technology solutions to support the missions of the Central Intelligence Agency and the broader U.S. intelligence community.”

However, Facebook’s owners are primarily motivated by profit. The social networking business model involves massive data mining that goes far beyond what you post on Facebook. Indeed, other websites visited by a user, even after logging out, are tracked by Facebook. The purpose is to create advertisements to suit an individual user’s specific interests. The company has continually reduced the privacy rights of its users to increase ad value, despite strong opposition.

Even with all this information, Facebook has yet to turn the type of profit that would “justify” its IPO price.

However, this seems to have more to do with the simple fact that Facebook users may not have the money to buy the commodities advertised. Given that the top capitalists predict lackluster profit potential for the company far into the future, the Facebook example only reinforces a general prospective that capitalism is at a dead end.

The important thing to remember is that the capitalist crisis, its political fallout and the growth of new technology are not within the complete control of the capitalists and their puppets in government. The same developments that make them all the more dangerous — from Flame to drones to artificial intelligence — also accelerate the forces behind their decline. n