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A Brief Political Economy of Hype

By Maxim Tvorun-Dunn

Silicon Valley depends on boom-and-bust cycles, manufacturing a new wave of investments every few months by promising grand technological revolutions, whether through AI, cryptocurrency, metaverses, or any other buzzword of the tech industry. These bubbles are furnished by media narratives and tech journalism. Through uncritical reporting of press releases and overexaggerating claims, news outlets help tech industrialists inflate their stock portfolios, while regularly ignoring the politics of privatization and automation. Reporting on psychedelics has followed similar trends, regularly positioning research on psychedelic therapy or drug manufacturing as Silicon Valley’s latest panacea.

Psychedelic startups and media coverage have followed an influx of Venture Capital, carried on by quasi-religious evangelists who claim that their products will lead the way to the future, offering low-cost private-sector solutions to the vast problems of contemporary society, while seeking to undermine public health care access and employment.

As the promotion of psychedelics has followed a similar structure to past technological hypes, it is worth here taking a step back from the specific promises made about these drugs. It is, instead, necessary to place their pattern of media frenzy into the wider economic systems which so profitably announce the latest way-of-the-future every fiscal quarter. Whether or not a roll out of therapeutic psychedelics proves as scalable as penicillin matters little in a political economy where Venture Capitalists (VCs) seem to always cash out “even if the revolution never comes to be.”

The actual realizations of these futures are largely irrelevant to the VCs funding these efforts. Instead, hype cycles exist first and foremost for VCs to profit off the stock trade as narratives of tech-led disruption shake up the market.

Hype affects markets, with media coverage and advertising demonstrated to increase stock value. Utopian hype promises and subsequently manifests market changes through the rhetoric of ‘disruptive innovation,’ promising that market incumbents will fall away as go-getting, rule-breaking entrepreneurial startups take their slice of the pie.

As wild utopian claims are legitimized through the apparatus of journalism during the hype cycle, external investors purchase shares, and consumers and corporations join the bandwagon. CEOs, middle managers, and school authorities become persuaded that the tech industries’ latest gizmos are in fact the next big thing, and, better yet, that these new paradigms are cheaper and more productive than conventional means.

Thus, departments replace staff with bland mass-plagiarizing AI tools that end up less productive, as editors must filter through automatically generated word-salads, while other firms forgo mental health counseling expenses to offer company-sponsored psychedelic therapy. Other departments bank on being early adopters in developing this new paradigm, with the potential to reap vast profits if the future comes from their designs, so startups, consulting groups, and research counsels arise.

With hype predicting market activity, the vast capital and data wielded by the information industry allows VCs to directly manipulate the market, raking in further capital by playing the stocks in tune with media buzz.

Just as disruption-hype raises the value of relevant startups promising potential far-out futures, these bubbles depreciate and default actually existing services. If tech evangelists convince companies that their newest algorithms will kill the need for writing staff, savvy investors might reasonably predict that writers’ studios will lose value, and preemptively cut funding. Similarly, if small, privatized psychedelics clinics may offer a magic pill for the stresses of contemporary living, then the mental health care offices currently serving communities will be less valuable in the face of these much cheaper operations. Hype serves as a self-fulfilling prophecy, and threatens conventional infrastructures that already exist, risking the unemployment and underfunding of necessary community structures. This is to say nothing of the occasions where tech hype is directly manufactured to kill public services. If coverage and investments in psychedelics follow the patterns of previous tech bubbles, mental health care access and quality will diminish in favor of low-cost Silicon Valley-led private startups.

While already extant services may crumble, VCs will receive a comfortable payout, whether or not their promised future comes. If psychedelics do become the next breakthrough therapy, the monopolized platforms and accompanying digital apps guarantee exponential gains for those holding patents, hosting infrastructure, and consuming user data.

In the more likely event that the hype is not fulfilled, VCs will still receive hundreds of millions in payout as they play the stocks in the reverse direction, pulling from the startups that never reached unicorn status. Conventional institutions may receive re-investments after this period, or capital simply may be shifted into the next hype cycle. While some institutions that had once provided stable services for communities might again see external capital coming their way, many will, by now, have closed shop, lost customers and employees, faced logistical disruptions, or will have been simply pilfered and foreclosed by the very same networks of aggressive VCs and private equity firms that profit from this system.

Psychedelics, as with all tech-funded ventures, are simply another tool with specific but absolutely not universal use cases, and carry their own dangers, concerns, and under-researched directions. Media hype positioning psychedelics as the future of mental health care, a utopian means to end conflict, or a convenient and individualized solution to solving climate change is playing into the pockets of a select few ultra-wealthy by misleading readers, over-exaggerating claims, and failing to critically engage with the politics of privatized health care solutions. In the boom of private psychedelic clinics and digitized therapy, conventional mental health care institutions risk underfunding, health care outcomes diminish, disparaged communities get left behind, and neoliberal ideologies of personal responsibility are reinforced. For every personalized story of drug-induced improvement to mental well-being, the marginalization of communities and social inequalities, which most directly contribute to poor mental health, are furthered by capital-hoarding private institutions. Vast improvements to society will not be gained through singular innovations of privatized medicine; it is only through public funding, regulation, and democratic community efforts that opportunities will expand, inequality diminish, and health care improve.

Maxim Tvorun-Dunn is a PhD student at University of Tokyo’s Department of Interdisciplinary Cultural Studies.

The Petrie-Flom Center Staff

The Petrie-Flom Center staff often posts updates, announcements, and guests posts on behalf of others.

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