Owen Jones Doesn’t Understand Steve Jobs And The iPhone

Owen Jones insists that billionaires simply shouldn’t exist. Because for everyone that does millions have been deprived of the value they create.

Dan Riffle, senior adviser to Ocasio-Cortez, says every billionaire is a policy failure. He’s right. A billionaire is someone who has concentrated wealth that is collectively created by the hard work and graft of others. A significant portion have inherited their wealth. But even the majority who haven’t are not “self-made” by any accurate use of that term.

Well, no, not really. We have the empirical research to show that it’s the other way around. Of the value created by innovation the entrepreneurs end up with perhaps 3%. The other 97% flows to others in society. Near all of that in the form of the consumer surplus.

Far from billionaires nicking it off the producers they’re picking up pennies of the value that arrives with all of us.

Owen then gives us the Mazzucato nonsense:

Here’s an example. When I defended Russell-Moyle’s argument, the former Ukip MP Douglas Carswell believed he had the perfect comeback: “What about the billionaire who created the smartphone Owen is tweeting with?”, he said on Twitter. But this was one of the worst examples he could have used. First there is the matter of iPhones being made by underpaid, exploited workers: no such company can make profit without relying on the deliberately undervalued efforts of their labour force. But it goes far beyond that. As the economist Professor Mariana Mazzucato notes, rather than being the ingenious personal creation of Steve Jobs, the iPhone brings together technologies created by the state at vast public expense. You name it: touchscreen technology, GPS, Siri, liquid crystal display, the microprocessor, the micro hard drive, signal compression, the internet itself – all were created by publicly funded research and development. Their workforces were educated by the state; their property is protected by a vast state system of justice.

It being a Mazzucato argument of course it is wrong. And even if it were correct we do hand over a third of everything to government. We’d like to get the odd bit of science and technology back.

But even if we accept those claims it’s still wrong. For what is entrepreneurship? No, it’s not technology, it’s not invention, it’s not science nor is it engineering. It is the taking of extant resources and their application in a new manner. Perhaps to solve a problem that could not be solved before. Perhaps to do an old thing more efficiently. But the very definition is to take things that are out there – land, labour, capital, technology – and combine them in a new manner which adds value.

What is combined, how, where it came from, that’s none of it the point. It’s the “What if we do this?” that is.

And was Steve Jobs responsible for that? Sure. He’s one of the very rare people who did it twice in fact. Thrice if we include Pixar.

Steve Jobs and the iPhone isn’t, as Mazzucato tends to shriek, as Owen is here dribbling, the exemplar of why no one does it by themselves. It’s entirely the opposite, he really did build that. Built it out of the blocks available to him at the time which is that very definition of being an entrepreneur.

As it happened, that third of his creations, the smartphone, is the fastest adopted technology anywhere, anywhen. Not bad for a man too stupid to go to hospital to get his cancer treated, relying upon the healing power of kale instead*.

*To start with that is.

6
Leave a Reply

avatar
6 Comment threads
0 Thread replies
6 Followers
 
Most reacted comment
Hottest comment thread
6 Comment authors
Leo SavanttPhoenix44JimJohn BHJ777 Recent comment authors
  Subscribe  
newest oldest most voted
Notify of
Quentin Vole
Guest
Quentin Vole

Jobs didn’t invent the smartphone. I had one (from Handspring) years before the iPhone. What he did was to make it really shiny. 🙂

HJ777
Guest
HJ777

In any case, Mariana Mazzucato is wrong about the microprocessor. It is generally accepted by electronics engineers that the first real (or at least commercially available) microprocessor (the 4004) was invented by Intel in response to a specification from a Japanese calculator manufacturer.

John B
Guest
John B

Wealth it created in the eye of the beholder. Without that perception of wealth, all that hard work and graft of others is worthless.

The boy Owen believes that everything has inherent value, and how much value depends on labour input. And of course there would be no hard work and graft for others to do if someone hadn’t had the idea for the product and set up the business in which it could be made.

Jim
Guest
Jim

When I think how much easier Mssrs Brin and Page have made my life, and the lives of billions of others, how small minded do you have to be to think they don’t deserve whatever tiny fraction of all that benefit they personally have managed to get into their own pockets?

Phoenix44
Guest
Phoenix44

The whole argument is utter garbage because it focuses purely on cash. For every billionaire there must be at least a billion worth of goods and services provided. I sell a song on the web for £1 to a billion people. I have a billion, they have a billion too. How is me getting g a billion and you getting a billion unfair to anybody?

Leo Savantt
Guest
Leo Savantt

“no such company can make profit without relying on the deliberately undervalued efforts of their labour force”

A truly terrifying misunderstanding. Although there is something perverse in a society that allows for uber wealthy 1 percenters like Mr. Jones.