Her promise of a magical technology that would transform healthcare proved a lie, but why were so many smart, plished investors willing to believe it?

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Elizabeth Holmes has been found guilty on four of 11 federal charges of wire fraud and conspiracy, after promising revolutionary blood test technology from her corporation, Theranos. The promised disruption was something people desperately wanted and still want: cheap, quick blood tests, requiring only a finger drop of blood. In reality, the corporation went from a $10 billion valuation to destroying almost a billion dollars of investment money, and now ends with Holmes in prison. It was all a lie, from its 2003 beginning to the beginning of the end, in 2015, when John Carreyrou broke the story in The Wall Street Journal, to 2018, when Theranos shut down and Holmes was charged.

Theranos promised to get all the information you need to save your life from a few drops of blood. It advertised its “nanotainers,” small receptacles of about half an inch that could hold only a few drops and were supposed to help “miniaturize” blood tests for analysis in a magical Edison machine, its major technological creation, which no one ever tested. For years, everyone was taken in and Theranos brokered contracts with Safeway and then Walgreens to run test clinics in their facilities, even though Theranos could not do blood tests as well as ordinary healthcare providers, much less do them at a fraction of the cost and with only a fraction of the blood samples. Obviously, both corporations sued for breach of contract and won. But the scam went further, and Theranos got contracts from healthcare providers AmeriHealth Caritas and Capital BlueCross to do lab work.

Given the crises in our healthcare politics, of course it was an attractive idea. Even before COVID, we were vulnerable to health and safety fantasies and Holmes constantly talked about our fear of death, our fear of losing loved ones, the loved ones she herself had lost, and she promised to quell our anxieties through technology. mercials featured people afraid of how much money they might have to spend on blood tests. The digital revolution is spreading across America from Silicon Valley, so why not apply it to medicine, too? What in our economy works except digital technology? A lot of our enthusiasm for technology is really concealed despair that puters seem to have a future, which makes people too eager to be part of such ventures. So pletely fake machine made up by this young woman became an object of a kind of worship of our modern power, achieving remarkable success for more than a decade.

This is where things turn into magic rather than business, science, or mon sense. Holmes remade her image into a caricature of Steve Jobs, and everyone believed it, because they wanted another Steve Jobs, especially a female one. She cultivated the image of a freak, not just dressing in black all the time, but never blinking and lowering her voice unnaturally. She made herself into an object of fascination, and people were indeed fascinated. In the new economy, it’s weirdos or the downright bizarre who succeed, not normal people. That’s what the press sells, that’s what Silicon Valley advertises, and at some level, that’s what we believe, since most of the economy—the normal economy—has been doing badly for a long time.

Elon Musk calls his car Tesla, after the immigrant inventor of alternating current, presumably because he’s an immigrant inventor, too, and makes electric vehicles. In a parallel development—both corporations started in 2003—Holmes called her fake magic blood-testing box Edison, after the once revered American inventor, the Benjamin Franklin of the electric age. This identity of a real founder and a fake one should send us thinking about the myths we’ve grown up with. Back in the 18th century, electricity made many people believe in magical powers as soon as Italian physicist and physician Luigi Galvani struck current into dead animals to make them twitch. Maybe you can conquer death—that’s what inspired Mary Shelley’s Frankenstein! Maybe you can talk to the dead, another obsession of the post-Christian elites who started believing in séances and other occult rituals. All this culminated in movies and TV, which sell fantasies all the time—and, of course, advertising, which is where fantasy meets business. The dogmas whose prophets are our celebrities gained dominance over the public mind over a long period.

Nowadays, our mad elites look for the occult among aliens, which have recently e the object of munications from government institutions after decades of being relegated to movies or TV shows like The X-Files. But the meaning of aliens is that everybody is trying to escape our reality and leap into Fantasyland, with consequences across the economy. We are living through an attempt to establish rule by whoever advertises the most amazing fantasy—for example, the metaverse. We’re not well prepared to deal with such a temptation. Most of us aren’t good at business, and all businesses need advertising, so we e vulnerable to people who advertise themselves as visionary businesspeople. Who are we to say what’s a dumb idea and what’s the next amazing thing? Most of these visionaries are just wizards of Oz, hollow celebrities and psychologically damaged, but we’re only learning that now, since the arrival of digital technology is destroying the old fantasies about celebrity. Indeed, some of them end up in jail, breaking the spell of disruption at least a little, allowing us to think harder about what’s going on in America.

Holmes herself used to talk about her love of Moby Dick and Homer’s epics to explain why she did what she did. This is the greatest fantasy in Fantasyland—to e a celebrity leader, a JFK (the TV president) or an Obama (the Silicon Valley president), a rock or Hollywood star with a cause, or, indeed, a transformative CEO like Steve Jobs who wills the future into being. Disruption, the favorite term of Silicon Valley, is merely a euphemism for the marriage of morality and power, which would make the whole world love such a hero! It’s success worship unrestrained by any natural limits.

Conspiracy and imposture, celebrity attempts to sucker us and elite attempts to humiliate us if we don’t believe what we are told—all this is so widespread nowadays that an impostor like Holmes could waltz into the elite world and receive the fawning of the media, all the enthusiasm signaled by investment from ignorant people outside Silicon Valley who thought they were buying into something amazing, and a big board full of the names of American prestige, making a mockery of corporate capitalism, government, and public opinion in the process. Just look at the people on her board, which included even elite politicos like Henry Kissinger, Gen. James Mattis, and George Schultz, who had no business involving themselves in such a scam. Holmes did not make us or our elites crazy; she only exploited the ways in which they already were crazy and the rest of us powerless to do anything about it. The press, businesses, and prestigious institutions that hoped she would be a success that would profit them were already suckers looking for a conman.

Con artists always reveal something about their marks. In this case, it was a desperate attempt to escape rising healthcare costs, to escape a failing economy where it seems only digital technology can make for success, and to escape ultimately a disappointing reality in favor of fantasies. Holmes is a mad woman, but so were most of the elites who fell under her spell or thought to use her to cast a spell of feminist disruption over the rest of America. We have to escape the Fantasyland to which we have been consigned by our media, and we have to do so without going mad when we see what mad things are done in the name of technological disruption. Small-time scammers like Holmes, who humiliate prestigious people who think they are our betters but are in fact rather silly, are almost e ic relief in the drama of our times.

Of course, the drama goes on—the online world is in one sense democratic and populist, replacing the “aristocracy” of televised celebrity, and there’s a lot of anger about all the lies we were told about a bright future that never came. We have failed to conquer the future, populate it with our dreams, and then watch ecstatically as it all came true. We didn’t all turn out winners and we’re dangerously tempted to turn to revenge. We’re all dangerously aware of how replaceable we all are—that’s why we’re willing to treat our elites as replaceable, too. It’s harder and harder to believe change is progress and more depressingly obvious that change is merely blind chance.

In another sense, the online world is very oligarchic—never in American history have so few corporations been so important to our national life, dealing not just with valuations and economic growth but national security, too; and also with our property rights and rights to free speech, assembly, and petition for redress of grievance; and with the very education of our children, even in their preliterate years. It’s not enough to laugh at the elites fooled by imposters; we have to think about our own vulnerability if we’re going to thrive.