- Scott Galloway is a bestselling author and professor of marketing at NYU Stern.
- The following is his recent blog post, republished with permission. It originally ran on his blog, “No Mercy / No Malice.”
- In it, Galloway questions if America can still call itself a nation, given the increasing evidence of weakened community support and degraded empathy that has been exacerbated during the pandemic.
- As companies like Amazon and Walmart enjoy massive government stimulus aid, a fourth of Americans can’t pay their rent, and many are working low-wage, at-risk jobs to try to keep food on the table.
The pandemic’s most enduring feature will be as an accelerant of existing trends. The trend that encapsulates the greatest reshuffling of stakeholder value in recent history is… the Great Dispersion. Similar to prior macro trends like globalization and digitization, it offers enormous opportunity, but also real threats.
In 1997, I was asked to address the board of Levi Strauss & Co. on the future of brands and retail. The title of my presentation was “The Death of Distance.” My basic rap was that all brands needed to establish a direct relationship with the consumer (e-commerce). We are entering the post-distance era, as tech has dispersed ever larger segments of the economy without regard for existing distribution channels.
Amazon dispersed retail to desktop, to mobile, to voice. Netflix dispersed DVDs to our mailbox, then to every screen. The pandemic is causing dispersion in even larger industries – the greatest opportunity for wealth creation in decades. Work from home, telemedicine, and remote learning represent an impending disruption of over 25% of the US economy. The largest sectors are about to leapfrog HQ, doctor’s offices, hospitals, and campuses.
Not all dispersion is about “x from home” or from cities to smaller towns. Social media is a form of dispersion, enabling connections, competition, and debate despite physical distance, print, and paywalls – the dispersal of community. It has also removed healthy friction (truth, science, editors) resulting in an afterburner for misinformation and conspiracy.
Dispersion offers the same potential for wealth creation as globalization and digitization. This time around, however, we must be more conscious of downsides. Previous paradigm shifts catalyzed massive prosperity but little progress. We’ve embraced a winner-take-all economy crowding the spoils to fewer firms and people.
In 2018, the top 1% of US households controlled 32% of total household wealth, up from 23% in 1989. The result of increasing inequality has been a rise in anger, nationalism, and a drift away from the cooperative international framework.
Erosion of empathy
The Great Dispersion will create many winners, on several levels. Commuting and business travel are two of the modern world’s most wasteful activities. Commuters waste an average of 54 hours a year stalled in traffic, and the average passenger vehicle emits 5 metric tons of carbon dioxide a year. That waste is saved when the commute is to the home office or a local shared workspace, or when the kick-off meeting is held in a virtual conference center.
While this dispersion has tangible benefits, it also has the power to erode our weakening ties of community and cooperation. The office is more than a place of work, it’s an equalizer, as Esther Perel said. Meeting people from different backgrounds, running into someone by the water cooler, having a spontaneous lunch with someone you barely know – chance connections are aspects of the office many of us miss.
Dispersal is cousin to segregation, and segregation reduces empathy. One study found that in integrated communities, white residents had warmer feelings towards other ethnic groups when the percent of those groups increased – but in segregated communities, feelings towards other groups grew colder as the population of those groups increased.
Integration and contact improve intergroup relations. Negativity arises when like-minded individuals are isolated from diversity. Contact is most effective at increasing understanding when it’s non-confrontational.
The pandemic has given us a preview of our dispersed future. Today we have social distancing – tomorrow the distancing will be structural. In a dispersed world we’ll have fewer encounters involving diversity of skin color, economic status, and gender/sexual/political orientation. When we do have these encounters, they are in the wrong context. Arguing with a stranger over a mask isn’t likely to produce tolerance as much as it will reinforce existing stereotypes.
Are we still a nation?
The structural distancing of the Great Dispersion presents an enormous threat to our commonwealth, a further erosion in empathy. We no longer go to movies, the subway, malls, public school, the grocery store or our polling station. We don’t experience the mentally ill vet panhandling at the freeway off-ramp, the single mom bringing us our food, the immigrant drying our car. Poor kids won’t see that rich kids are no different then they, and vice versa.
Nation is defined as “a large body of people united by common descent, history, culture, or language, inhabiting a particular country or territory.” Are we still a nation? This is a serious question… The evidence of our weakening community, our degraded empathy, is all around us. The pandemic has been a preview of that, too. While it kills Americans at three times the rate of WWII, haven’t we outsourced the costs to poor people of color and frontline workers?
The two largest asset classes in America are residential real estate and stocks. 10% of the population controls 70% of the value of these assets. Both are trading at all-time highs as we bury 2,800 Americans a day, Tesla is up 590% YTD, and one in four households have experienced food insecurity this year. Jeff Bezos is worth more than every citizen in Vermont, Alaska, and Wyoming combined, while a fourth of Americans can’t pay their rent.
Compare this with the nation we were before we started dispersing into our bubbles. Within weeks of the outbreak of WWll, Chrysler built a factory in the Detroit suburbs that manufactured more tanks than the entire Third Reich. Today, Amazon and Walmart enjoy record sales and stock gains from stimulus. When young men refused the draft in WWII, we imprisoned five thousand of them. Today, we tolerate people who refuse to wear a mask to Walmart and give audience and platforms to cries of “tyranny.”
When a member of the armed services dies on active duty, their family immediately receives $100,000 to ease their grief and burden. When an immigrant head of a food-insecure family takes his diabetes medication, piles Diet Cokes into an cooler, turns on his Uber driver app, contracts COVID-19, and dies, his family is denied death benefits, as Proposition 22 – supported by $205 million from sharing economy firms (Uber, Lyft, DoorDash) – has made it legal to deny his family death benefits.
The Amazonian woman, and all 2021 WarnerMedia films, are coming directly to our screens. Another dispersion, from movie theaters to living rooms. This represents a larger trend, the Great Dispersion, and enormous economic opportunities. It also represents a greater threat – the loss of empathy and what it means to be a nation, to sit in a movie theater with people who don’t look like you. Diana Prince comes to American living rooms with strength and integrity, in the pursuit of peace and justice. She’ll find America, but not a nation.
Life is so rich,
P.S. My new book, Post Corona, became a NYT bestseller. Thx to everyone who bought one. If you haven’t yet, please buy one for yourself, your parents, your child, and your dog.