All writers steal, but since the victim of today's larceny is my friend and publisher Bill Singer, I have to give him props. It's one of his best stories, so I hope I do it justice.
Years ago, when Bill and I practiced law together, we had a client who was licensed to use the Star Trek brand to sell coffee products. The client marketed a strong coffee that he labeled Klingon Raktajino, after the brew that Worf drank on board the Enterprise. One day, some sample bags of the raktajino coffee were delivered to our law firm while an IT tech was wiring a new computer under Bill's desk. When the tech finished his work, this bona fide geek saw the array of packaging on Bill's desk and asked him, somewhat skeptically, "Is that real Klingon raktajino?"
Bill claims he was stumped, which doesn't happen often. Where to start? Real raktajino presupposes real Klingons, and with them a Star Trek universe that transcends the Paramount lot and Comic-Con. The question alone reveals enough about the inquirer to suggest a HIPAA violation. Yes, I know a quick Google search will cough up recipes for raktajino made from espresso, cinnamon, cloves, allspice, nutmeg, sugar and powdered milk, but I'm not buying it. Worf would never drink such stuff. I imagine "real" raktajino would be a heartier brew, with full-bodied acridity and floral notes of trilithium resin.
I recall this gem of a story because all week I've been thinking about Jeff Bezos. Jeff has crossed my mind a few times in the past year, but this week's obsession was prompted by two lengthy profiles of him and Amazon, published in fast succession, first in this month's Atlantic and second in this week's New Yorker. Those two pieces tell us a lot about the world's richest man, but what they tell us most is that one can't understand him or Amazon without grasping his essential trekkiness. Bezos was a Trek nerd in his youth, but unlike the rest of us, he never gave it up. He is still deep into the raktajino.
In 1963, science fiction master Arthur C. Clarke penned Profiles of the Future, a survey of what he thought future technology might bring us. To reread it almost 60 years later is to appreciate how right was Mark Twain or Yogi Berra when he/they said, "It is dangerous to make forecasts, especially about the future." And yet, Clarke holds up pretty well. He predicted that by now we would have personal radios (cell phones), artificial intelligence (sort of), wireless energy (for your iPhone at least), a global library (call it Google for short), robots (almost), and control of heredity (and more).
Clarke also thought that by 2090 we would have a "replicator." This device would be able to create material objects out of a stockpile of simple atoms, sort of like a super-3D printer. The replicator, according to Clarke, would render all material objects intrinsically worthless, recreateable at will. "Nothing -- no ‘things' -- would be as priceless as craftsmanship, personal skills, professional services." But he cautions that we are not ready for it. "Confronted by it, our own culture would collapse speedily into sybaritic hedonism, followed immediately by the boredom of absolute satiety." He was right about that, too.
Replicators appear all over the Enterprise. "Computer," Capt. Picard might say, "make me a ham sandwich." And a ham sandwich would materialize in what we might mistake for a microwave. But from the user's perspective, how different is "Computer, make a widget," from "Alexa, order a widget from Amazon"? The time delay, 24 hours with Amazon Prime if you're in the right market, seems trivial. Sure, we have to spend some of our money to make Alexa obey, but since we spend it so readily, that too seems trivial. Were there a Turing Test for replicators, Alexa might pass.
In the Star Trek universe, the replicator may have had the effect Clarke anticipated. "The economics of the future are somewhat different," Capt. Picard told his naive 21st century companion in Star Trek: First Contact. "You see, money doesn't exist in the 24th century. The acquisition of wealth is no longer the driving force in our life." See https://www.youtube.com/watch?v=oin3reELMKg. That was perhaps an overstatement. Even in Star Trek's 24th century, the Ferengis codified 285 Rules of Acquisition, the first of which so basic that I've known many a stockbroker honor it even in ours: "Once you have their money you never give it back." See https://memory-beta.fandom.com/wiki/ Ferengi_Rules_of_Acquisition.
Under Bezos, Amazon has adopted its own Rules of Acquisition, even though they euphemistically call them the 14 Leadership Principles. While purporting to be precepts of excellence, the real underlying ethic is cheapness. "Frugality breeds resourcefulness, self-sufficiency, and invention!" At Amazon, employees were castigated for printing on just one side of a sheet of paper. "Whenever Amazon moved to new offices, Bezos had them furnished with cheap desks made from wooden doors. Whereas other tech company supplied employees with an array of free meals and snacks, Amazon offered only coffee and bananas. (In a statement, Amazon said that it is ‘frugal on behalf of our customers.')." https://www.newyorker.com/magazine/2019/10/21/is-amazon-unstoppable.
In the meantime, Amazon's "frugality" has come under fire as its warehouse workers complain of being driven to complete more tasks faster, giving up even bathroom breaks in order to meet algorithmically determined productivity quotas; as it's unregulated delivery drivers have caused injuries and deaths trying to get packages delivered on accelerated schedules; and as its online vendors complain that Amazon restricts their ability to compete and undercuts them when they are successful. It is easy to glorify the virtue of thrift when you stand to profit by it. Bezos is a libertarian who believes Amazon's only responsibility is to pay employees for the time they work. That has made him a lot of money. His net worth is now about $114 billion, but only because he gave $36 billion to his ex-wife in the wake of his now much-publicized affair.
What does he do with it, he being so frugal and all? In Franklin Foer's Atlantic article, it all goes back to Star Trek. Bezos's high school girlfriend was quoted as saying, "the reason he's earning so much money is to get to outer space." In his valedictorian's speech from high school, he unveiled his vision of earthlings colonizing space, and to turn the planet to a huge national park. https://www.theatlantic.com/press-releases/archive/2019/10/november-2019-issue-release/599809/. All that, of course, is pure Star Trek. It's no surprise that one of Bezos's prized possessions is an old uniform worn by Patrick Stewart portraying Jean-Luc Picard. Picard, according to the articles, is Bezos's hero. The name of this first startup was makeitso.com. This hero worship has gone to the absurd point where Bezos has been spending time in the gym to bulk up, and shaved his head so that he now even looks like Jean-Luc. We should see him in his Starfleet uniform soon.
Of the country's five top billionaires, Bezos is the only one not to have signed Warren Buffett's and Bill Gates's "giving pledge." Bezos is redirecting his charity. He spends $1 billion a year out of his own fortune to finance his space company, Blue Origin. Bezos calls Blue Origin, which provides "infrastructure for extraterrestrial voyage," his "most important work." He still has visions of getting folks off the home planet and into space colonies. He is still a teen nerd at heart. God bless him.
Yes, it's all a little mad, but there's method in it. Amazon's business is built on the idea of a private value-added tax. Amazon wants to provide logistics for basically everyone and everything, collecting a vig on the vast array of transactions, big and small, that flow through its doors. Amazon's goal is to increase that flow. A colony somewhere out in the expanse, where you must buy everything, including the very air you breathe, is Amazon's ideal environment. That's the way Bezos imagines it. As Jonathan Foer puts it, the would-be Jean-Luc Picard "has built a business that better resembles Picard's archenemy, the Borg." And yet, for all our criticism and concern, Amazon remains so alluringly convenient that resistance is indeed futile. I fear we're stuck with it until a real replicator comes along. Enjoy your raktajino.
Aegis Frumento is a partner of Stern Tannenbaum & Bell, and co-heads the firm's Financial Markets Practice. Mr. Frumento represents persons and businesses in all aspects of commercial, corporate and securities matters and dispute resolution (including trials and arbitrations); SEC and FINRA regulated firms and persons on regulatory compliance issues and in SEC and FINRA enforcement investigations and proceedings; and senior executives of public corporations personal securities law and corporate governance matters. Mr. Frumento also represents clients in forming and registering broker-dealers and registered investment advisers, in developing compliance policies, procedures and controls, and in adopting proper disclosure documents. Those now include industry professionals looking to adapt blockchain technologies to finance and financial market enterprises.
Prior to joining the firm, Mr. Frumento was a managing director of Citigroup and Morgan Stanley, a partner and the head of the financial markets group of Duane Morris LLP, and the managing partner of Singer Frumento LLP.
He graduated from Harvard College in 1976 and New York University School of Law in 1979. Mr. Frumento is a frequent author and speaker on securities law issues, and is often quoted in the media on current securities law developments.
NOTE: The views expressed in this Guest Blog are those of the author and do not necessarily reflect those of BrokeAndBroker.com Blog.