In the pass month, “The Dropout”, a series about the rise and fall of the tech start up company Theranos, dropped onto Disney Plus, but this article is not a review of that series, instead this article is a review of the actual case and lessons it could teach us about unfretted capitalism.
In case you aren’t familiar with the case, Theranos was founded in 2003 by Elizabeth Holmes, a nineteen-year-old (yes you read that right, nineteen) Stanford dropout. The company’s aim was to create a device, called the Edison, this machine could take samples from a single drop of blood and within an hour could provide a full sheet of diagnoses thereby eliminating the need for needles and for labs.
Sounds like something out of science fiction, doesn’t it? Well that because it was. For as it turned out the device did not and could never had worked. But somehow, for almost fifteen years, Elizabeth Holmes fooled not only her employees, but also investors, business companies and even actual ill patients into believing that it did.
It wasn’t until an Avenger’s like team consisting of ex employees, independent scientists, a grieving widow, a news reporter and even Holmes’s former neighbour to eventually gather the evidence that ultimately brought her and her company down back in 2018.
But the damage had already been done, Theranos was already fifteen years old when it was shut down and already had billions of dollars poured into it from investors like Larry Ellison and even Rupert Murdoch of all people. It even had a board of governors that resembled the Cabinet of a US President as three of the board members were or would become actual cabinet members of the United States government with former Sectaries of State, Henry Kissenger and George Schultz being members of this board.
Indeed it is in George Schultz is where I find a sense of irony in all of this. For those of you who weren’t familiar with the man, he was the Secretary of State under Ronald Reagan in his second term and was considered to be the man who helped bring down the Soviet Union which resulted in the win of capitalism over communism. Ronald Reagan, the figure head of unfretted, free market capitalism ideology and Schultz was his right hand man and he ended up being conned by a twenty something college drop out, convincing him to pour in hundreds of millions into her company all without seeking outside medical or business advice before doing so. A man of small government and low regulated business being conned by a big business that he helped set up and protected, oh the irony.
Once the cat was out of the bag and Theranos was forced to shut up shop, Elizabeth Holmes was eventually brought on charges of defrauding investors and patients by the U.S. federal government with her trial starting last autumn and lasting until January of this year where she found guilty of defrauding investors but not guilty of defrauding patients (if that makes any sense at all) and she faces up to twenty years in prison for her crimes (but because this was her first criminal offense a lot of legal experts doubt she will be sentenced to that long of a stretch).
I guess that just about sums up this capitalist world, that you can defraud penniless sick patients all you want and even put their health at risk but don’t you dare defraud stupid gullible millionaires.
Holmes came up in the time of the Zuckerbergs and Musks, the first generation of businesspeople and inventors that came up after the fall of the Soviet Union and who were to prove once and for all that its capitalism that is the right path to take in ethics and in freedom.
But what this case has taught us is that its far from it.
It has taught us the dangers of un regulated business, how greed rots our very ethical cores and blinding us as it does and that figures like Elizabeth Holmes should not be worship like a god but instead to be weary of.
One final thing you should know about Elizabeth Holmes before I wrap this piece up is that her all time hero was Steve Jobs, apparently she would have posters of him on her wall as a child the way other teenagers would have pictures of Justin Timberlake on theirs. She even copied his wardrobe by wearing a black turtle neck. But as we learned in the years since his passing that Steve Jobs was no angel, he could be abusive to both employees and to his own family. But still Holmes wanted to be the next Steve Jobs and I think she surpassed him as I think that even Steve Jobs would never have gone as low as Elizabeth Holmes did in order to make the only thing that ever matters in Silicon Valley: Money.
For ethics I give Elizabeth Holmes: 3/10
And for that horrible fake deep voice: 2/10