Gladwell And Anderson Talking Past Each Other

Malcolm Gladwell reviewed Chris Anderson’s Free and attempted to dislocate some of the more vaporous claims Anderson makes about an economy based on abundance, not scarcity. For example, Gladwell notes that the true driver of energy costs is the infrastructure and plant, not just the resources being burned up:

Anderson wants to take “too cheap to meter” seriously, because he believes that we are on the cusp of our own “too cheap to meter” revolution with computer processing, storage, and bandwidth. But here is the second and broader problem with Anderson’s argument: he is asking the wrong question. It is pointless to wonder what would have happened if Strauss’s prediction had come true while rushing past the reasons that it could not have come true.

Strauss’s optimism was driven by the fuel cost of nuclear energy—which was so low compared with its fossil-fuel counterparts that he considered it (to borrow Anderson’s phrase) close enough to free to round down. Generating and distributing electricity, however, requires a vast and expensive infrastructure of transmission lines and power plants—and it is this infrastructure that accounts for most of the cost of electricity. Fuel prices are only a small part of that. As Gordon Dean, Strauss’s predecessor at the A.E.C., wrote, “Even if coal were mined and distributed free to electric generating plants today, the reduction in your monthly electricity bill would amount to but twenty per cent, so great is the cost of the plant itself and the distribution system.”

This is the kind of error that technological utopians make. They assume that their particular scientific revolution will wipe away all traces of its predecessors—that if you change the fuel you change the whole system.

Anderson read the review, and riposted, but only with regard to the comments that Gladwell makes about free journalism:

It’s now clear that the bane of my next year will be questions about the future of the newspaper industry from journalists. I don’t blame them—newspapers are indeed one of the industries most affected by Free (although that’s just one manifestation of their larger problem: having lost their monopoly on consumer attention). And neither I nor anybody else has any good answers, other than the newspaper business is probably going to shrink but not go away, and that the business model will have to change.

But since journalist Malcolm Gladwell has somewhat parochially decided to make the Future of Paid Journalism the focus of his review of Free (which is, ironically, free on the New Yorker’s website; perhaps this is something Gladwell should take up with David Remnick?), I’ll try to respond in a bit more detail.

The fact is, however, that Gladwell responded to several of Anderson’s arguments, not just journalism, and Anderson doesn’t respond to those at all.

Yes, Gladwell is making the economy of scarcity argument, and it is simple to demolish that stance in the newspaper realm at the moment, as a million people want to write for peanuts (here I am, for example) and the newspapers are in freefall.

But what about energy wanting to be free? Or pharmaceuticals, Chris? Could you please revisit Gladwell’s piece and address the hard bits?

[Update 11:47am: Paul Kedrosky weighs in.]