Elizabeth Holmes and the Mystification of Commerce

In my hunger to put my eyes on actual New Content instead of the same old lamentations on Endless Trash, I decided to give the Hulu series on Elizabeth Holmes and Theranos, The Dropout, a try. It was pretty good, as such devices go. It had points to make about what Elizabeth Holmes was and what she represents. Amanda Seyfried is practically custom-made for the role, and her performance alone would make it watchable, and there’s plenty of minor characters along the way who satisfy.

I realize, of course, that I’m making observations based on a fictional account of real events. But the account hems pretty close to reality, if Business Insider is to be believed. You may draw your own conclusions.

One way to look at Elizabeth Holmes is as a counterpart or even a diptych of Billy McFarlane, the pseudo-impresario behind the abortive Fyre Festival.

Bad music festivals have happened in the past. No one died at Fyre, but at least at Altamont The Rolling Stones actually showed up and played. This Festival existed only in the creators’ mind. It was fairy dust. The belief that Instagram could force reality to conform to it comes from the age we live in.

Quick Review: Fyre Fraud“, Content Blues

We might also throw in Caroline Calloway, if we hadn’t already forgotten who she was.

The worst scammers are those that believe their own bullshit. If Calloway had just let Beach ghostwrite the book, she’d be full of it, but there would have at least been a book. If McFarland had limited his expectations, their at least could have been a party on whatever island that was.

But their minds were warped by saturated images and SEO data. They got high on their own supply.

A One-Woman Fyre Festival”, Content Blues

Elizabeth Holmes was a bigger con-artist than either of them. McFarland bilked some festival attendees, Calloway, a single publishing house. Holmes sucked in venture capitalists, former government luminaries, famous billionaires and Forbes. Forget the Wolf of Wall Street; she was the Siren of Silicon Valley, batting her big blue eyes and luring capital to its destruction.

Of course, the difference between the Wolf of Wall Street and these clowns is that Jordan Belfort knew what he was doing. He has no illusions about himself, and when all was said and done, was guilty of nothing more than bending the rules of the wild game that is speculative investing. He never sold anybody anything he didn’t actually have.

McFarland and Calloway and especially Holmes, on the other hand, were both better and worse. Better because, until the hammer came down, each of them believed like the believed the sky was blue in the purity of their own intentions. They didn’t want to deceive people; they had to, to keep going, and as long as they believed they could pull it off, why then, they would. Their faith in themselves was unquestioning, unyielding. Worse because, when all was said and done, they created absolutely nothing, void, digital ash in a digital urn.

The temptation is to frame all of this as cyberpunk self-hypnosis, Millenials believing that The Internet (PBUI) absolved them of the actuality of work. Any sufficiently advanced technology is indistinguishable from magic, and most people today don’t know how the Internet actually works. The hard part of designing machines to transfer data between each other was done for long long decades before Steve Jobs sketched his first blueprint.

As a consequence, all most of us know is Press Button, Achieve Result. The names of the thousands of geeks and machinists who created the code that allows me to type these words and upload them to every computer on the planet is as forgotten as the names of the monks who preserved the literary corpus of the ancient world. It’s just there. It’s just TechnologyTM. We can do whatever we want with it. They keep telling us that; it must be true.

Therefore, Holmes just knew that if she married modern tech to medicine, she’d achieve a revolution. It would work, eventually. Of course it would. Why wouldn’t it?

That’s all fine as far as it goes. But I think we can go deeper. There’s something in Holmes that’s more pathetic, and therefore more terrifying, than mere fraud or incompetence. Theranos was worse than that. Theranos was a cargo cult of capitalism.

This is readily apparent in more than just Holmes’ couture aping of Steve Jobs’ wardrobe, adding blazers and heels to the famous black turtlenecks. It’s found all over the corporate culture of Theranos.

Much of the culture of modern corporations is built on this kind of motivational magical thinking, middlebrow mysticism to keep salaried people working late into the night (and nothing is more middlebrow mystic than grown-ups quoting Star Wars as if it contained real insight. All doing begins with trying. Stop being such a nerd). You have to have the right mindset to do good work, that is true. But what is necessary is not always sufficient. Holmes seemed to miss or ignore that.

She thus comes across as the kind of person who believed that if she arranged the externals correctly, and believed hard enough, the tech would follow. Steve Jobs dropped out, so she dropped out. Steve Jobs used shiny-Bauhaus aesthetics as a selling point, so did she. Steve Jobs courted venture capital, so did she. She followed the script like a tribe of South Pacific Islanders building a simulacrum of a landing strip to invite the magic airplane to return. But the magic airplane doesn’t come; Theranos’ tech never worked. She had no power to make it work. And she never seemed to understand this.

It should also be pointed out that what she was attempting was a good deal more ambitious than anything Steve Jobs had done. Jobs, for all his fame, did not create new tech so much as create a new market for that tech (which in turn led to actual new tech). Holmes was trying to marry tech to biology, to transmogrify organic life into data. That’s not as easy as designing a PC in your garage, even in the 1970’s.

But again, she seems not to have understood this. She had an Idea, and as far as she was concerned, needed nothing more than will to make it reality. Reality was what Innovators like her turned Reality into. To believe otherwise is to doubt the Idea, which makes you a Heretic of Old-Thinking, a servant of The Existing Order, backsliding away from the Blessed Visionary.

Holmes appeared on CNBC’s “Mad Money” shortly after the WSJ published its story to defend herself and Theranos. “This is what happens when you work to change things, and first they think you’re crazy, then they fight you, and then all of a sudden you change the world,” Holmes said.

The Rise and Fall of Elizabeth HolmesBusiness Insider

All of a sudden. Just like that. This is the pattern. Don’t you see? We have solved it already; it just hasn’t manifested. We. Are. Changing. The. World. Don’t you want to Change. The. World?

Once during The Dropout, a character opines that if Holmes had stayed in school, she might not have been so troublingly naive. It’s a possibility. If she’d gotten her degree, she could have gone to work for LapCorp or Quest, determined what makes their tech work, and figured out how to build a better Siemens machine. Perhaps she could have stayed there, helping those companies improve their business. She would have made a contribution, albeit smaller, less dramatic. She would have lived a good life.

Or, if she was determined to be an entrepreneur, she could have started smaller, building something she knew could work, then directing the profits into more innovation. That would have spared her the humiliation of failure and fraud.

But this is pure speculation. She didn’t do that. She didn’t want to. She was too enamoured of the Vision. Her role was less a merchant than a Prophet of Millenarianism via Capital.

This is doubly embarrassing, because Elizabeth Holmes was not a poor or marginalized person too far removed from educated circles to understand how business actually worked. She was, far more than Billy McFarlane or Jordan Belfort, to the manor born. Her father was a Vice-President of Enron. Her mother was a congressional staffer. She had money; she had connections. She’s not an Outsider. She’s the daughter of our Ruling Class. Of course she had Kissinger and George Schulz in her camp; of course Bill Clinton and Joe Biden sung her praises. She’s of their sort. She’s Good People.

So before we rush to judge or defend her, let us understand what we are looking at. Commerce and Technology has become magic, has become a kind of religion, demanding devotion. It markets itself as ever transformational, ever improving, ever progressing. It does not acknowledge failure. Failure is what happened yesterday. We do not need Yesterday. We need only the Future.

We are governed and led by people who treat Mission Statements like incantations. There’s something very wrong with this, and I don’t know how to fix it.


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