I had penned some notes about bitcoin before the entire thing exploded last week. So it seems that everybody is blogging pretty much everything about bitcoin there is to blog. So trying to see if I have some points that are still worth publishing.
Provenance
The main improvement over a physical currency, is that with a digital currency you can in fact track all transactions. This is in fact a feature of bitcoin with its global transaction register.
The problem with that is that most transactions are done anonymously so you can see that money went from A to B but you don’t know who A and B are nor why it moved. This makes bitcoins very attractive to people selling illicit wares.
Now comes the challenge:
1. I don’t want to live in a failed narco-state (and I don’t think many others do either).
2. In principle I am for a currency where every transaction is public and traceable but I am not for the increase in state power that this will entail.
So there is probably some more crypto-trickery necessary to be able to get a currency where you can prove that: it wasn’t used for certain types of transactions, or that certain taxes were indeed paid in previous transactions.
Volatility
I used to think that bitcoin would not be viable because the market and individual actors are too easily compromised. The checks and balances are so weak that any computer exploit means you lose all your money. Right now I think that is in fact a feature not a bug.
Bitcoin was envisioned as an exchange currency and if you use it as such all of these problems go away. Whenever you need to buy something online, you convert some money into bitcoins at the day’s rate and do your business.
So it is in fact not necessary to store large amounts of bitcoins for a prolonged amount of time except if you want to speculate. All others would buy bitcoins as necessary and sell them when they don’t need them and this would increase the liquidity of the currency.
I have just watched the above conversation between Jaron Lanier and James Bridle in Conway Hall organized by the School of Life. The event was to mark the occasion of Lanier’s new book “Who Owns The Future?” (Guardian review) and the conversation focused on some interesting ideas from it. I will probably not read the book itself, but I think the things said in the video above can be taken by themselves and though they are provocative they do not motivate me to give Lanier any money.
The main issue is that Lanier signals some interesting problems (He’s not alone. Om Malik just posted this about Data Darwinism), he makes some terrible comparisons and posits solutions that are wholly unconvincing.
Problems
Laniers big idea is that those with the biggest computers on the network (and the largest collection of brains to program those computers) are in danger of becoming the rentiers of big data. They will be able to out-compute everybody else and figure out what Gibson called the ‘order flow’ in his Blue Ant trilogy: the best set of actions given the circumstances.
That is an interesting if not exactly novel idea. It serves as a jumping off point into some outright crazy ideas about intellectual property. Lanier compares the contraction created by the current austerity measures with what is happening in the music industry. This is a ridiculous comparison. Even if it did hold, then whatever is happening is an overdue correction to a situation that was unsustainably overleveraged.
In the same vein he waves around the scarecrow that ‘the economy will shrink’. A notion that will undoubtedly play well with the same audience that is inclined to buy his book. Rhetoric about shrinking economies is almost always a phantom. Economic shrinkage may very well be in our near future and does not necessarily need to be a bad thing.
Lanier’s point that people are forced into an informal economy is valid but it speaks more to the failure of social systems than anything else. The social democratic contract that may be inconceivable for Americans is working quite well in Europe. It may need updating both for changing demographics and the digital age, but I don’t think many people here would trade it for what Lanier is peddling. Like I mentioned in my data tax post, we don’t have the problem of musicians who can’t pay their medical bills.
Solutions
The proposed solutions are even more problematic (though if you’re so inclined you might term them ‘thought provoking’).
Lanier seems overly influenced by the music industry and by the concept of private copyright. I would assert that the music industry with its track record is not something worth emulating. The sky is not falling in the music industry. They are facing a long overdue re-evaluation of their social contract because their carrier of value has lost its excludability. There are still lost of people making music and thriving.
Lanier seems to roughly comprehend how a just society should work: ‘For society to be democratic, income needs to be distributed in a way that is roughly a bell curve.’ but at the same time he seems to be confused how it should be implemented: ‘Socialism needs to be off the table in the information age.’
The bidirectional reference networks that Lanier proposes that preserve the context and provenance of data sound fantastic. There are however real reasons why we are doing the ‘profoundly dumb thing we are doing’ instead. His network sounds awfully similar to the idea of the semantic web, where everything online will work perfectly if only we would do it The Right Way (which we of course never will).
His solution to ‘Become as aware as possible of how you fit in other people’s computation schemes.’ is a good idea. It is the same algorithmic literacy pointed to in work by Kevin Slavin, Douglas Rushkoff and James Bridle himself.
I’m afraid that Lanier’s rhetoric of a ‘more honest accounting’ will play particularly well in Germany where similar words are already being used to take Google to court. Germany passed a Leistungsschutzrecht (ancillary copyright for publishers) because they figured out that large American companies were making outlandish amounts of money based on the work of large German publishing houses.
The conversation of a fair distribution of wealth in a power-law based networked economy is one we need to have. I doubt though if this particular book is a good starting point for such a conversation. Lanier’s cultural foundations point us towards a solution that is at best unrealistic and tries to extrapolate the problematic private notion of copyright to society as a whole.
The data tax I wrote about yesterday is an approach from a more public point of view. That would focus more on personal data and the revenue generated from such a tax would go into government so it would be subject to democratic controls. Ideas that won’t fly well with Lanier’s Silicon Valley crowd, but maybe that’s all the better.
There are some interesting similarities between a recent proposal commissioned by the French government and the book out by Jaron Lanier just now “Who Owns The Future?”
Both analyses signal the dominance of corporate actors in a big data world and both suggest new methods of taxation as a potential solution to the problem. An article over at Forbes explains the commission’s proposal by Nicolas Colin and makes a lot of sense.
The French report has been received with predictable knee-jerk responses across the tech world. It is true that governments have not been very good at regulating the internet. But not regulating the internet is not a solution. We could hope for representation that is competent when it comes to the digital world.
The companies that create the internet should not cry foul. They have a track record of evading taxes more than contributing their fair share back to society.
I’ll tackle Lanier’s position in another post. I just watched the conversation he had with James Bridle in Conway Hall and noticed some errors in Lanier’s ideas: they require a fully functional semantic web, they seem overly informed by private copyright practice and complementarily they take a weak government for granted.
How you would enforce such a law is another question entirely, but it cannot go further off the mark than how large companies manage to evade taxes right now. It may in fact be a lot fairer to tax data at the point of collection/use.
If you don’t bother to read the article above, I can sum it up in two key points below:
Data is hazardous waste material and as such its production and storage should be discouraged (the CO2 tax was given as an example in the Forbes article). Cory Doctorow compared personal data breaches to nuclear disasters, because the fallout is so tremendously hard to contain and control. Whoever collects large amounts of personal data treats the privacy damage caused by breaches as an externality. As such the storage of such data should be discouraged with a tax.
Data is capital and should be taxed as all capital is. Storage, mining and arbitrage using data can generate revenue for sophisticated market actors (those that Lanier terms as those with ‘the biggest computer on the network’). Data is a value adding asset that generates wealth and more data for those who already have it. If we don’t want a situation where a small group of people get richer at the expense of everybody else, we should tax it.
So data is both capital and hazardous. We tax many things with either of those properties so we should definitely tax something that has both.
My small project during Swhack was to create a django version of a delegated voting system partially inspired by Liquid Feedback and the manyfold problems that system has. In particular that it is written on such an esoteric stack that it is near impossible to get running without root on a Linux machine and let’s not even discuss the maintenance. What is even worse is that it makes it nearly impossible for outsiders to join the project and contribute to it significantly.
In this interview about Liquid Democracy you can read quite clearly how the technical mandate drives the direction of the project. Something that may not be very desirable if you think of it as a democracy-centric issue and not a technology-centric one.
So to see how hard it would be to write something similar in vanilla django. It’s easy to hate on django but you can find tons of people who can work on this in just about every major city, the framework and the documentation are mature and many parts of the framework can be called excellent.
I thought putting something together that at its core implements a delegated voting engine should be doable in an afternoon and it was. What took the most time was playing around with the settings of the testrunner which I hadn’t really used before. So the watersnake app in this project does majority voting on single proposals with support for delegation. To see it work you have to run the tests, but building this out into a full fledged (web) app that can be deployed to heroku with a single command is technically trivial (and also time consuming).
This wasn’t a stretch to implement right now because I’m also doing some other projects which border on collaborative writing/decision making/filtering. As always, technology is neither the problem or the solution, but certain technical systems grant different socio-technical affordances than others. I will probably not work on this unless there is a clear demand, but I thought it would be useful to debunk the idea that building such a system needs to be difficult or complex.
So this Saturday Jan Lehnardt and I are having a small hackathon here in Berlin in remembrance of Aaron Swartz and to in one small way continue doing the work that needs to be done on the internet, in government and especially where those two meet.
We have done a lot of what we used to call ‘civic hacking’ in the past, a phrase that has been used so often by now that I’m slightly sickened when using it. But there is still a lot to be done and both resistance against the movement and co-optation are growing. In Germany, where I live now, things are still in a pre-dormant state. The internet is in a rather sorry state here and people are good at complaining but less so at changing things.
Saturday’s hackathon is meant to focus efforts and do random stuff. The stuff you normally never get around to doing because of the day-to-day business. I have some rather unorthodox ideas to change things but I could use some help. So join us!
I followed the last CCC from a distance reading the Twitter fallout and keeping track of the live streams while getting work done in an empty Berlin. Besides the various controversies playing out, there were some good talks. What I found to be the best of the event was “Long live the protocoletariat” by Eleanor Saitta (@dymaxion) and Smári McCarthy (@smarimc) about a topic that is very near to the things I am thinking about: institutions and networks and all of the opportunities and problems associated with them. The presentation in the first thirty minutes of this video is well worth watching. Pull quotes below are paraphrases.
I have been to CCC once and didn’t feel the need to go again. I have been long disheartened by the odd turn that political consciousness has taken within that particular technological crowd. The combination of information/privacy fundamentalism with a total disdain for normal users is something which is normal in the open source world but not something I can support.
It is refreshing then to hear two people at CCC who pursue an agenda that I think is important in a manner that make sense and is constructive. Briefly the things from the talk that I found noteworthy.
They treat the various levels of obscurity and disfunctionality built into Liquid Feedback but on the whole they do agree that it is a functional system that needs some bug fixing.
Liquid Feedback seems to have been sparked by a blog post some years ago is a good example of the primate of the developer. Because of limitations in development capacity, whoever builds these things builds the definitive version. It remains definitive until somebody builds a better one (or if the problem goes away). We don’t get the option of more consideration, or better design or any of the other things we would want. We get whatever time a volunteer can spare to hack something together that works. This also makes that often we are in local optima because there already is an implementation that is perceived to be ‘good enough’.
People who have the time to solve problems don’t have problems. Those with real problems are too busy coping with their problems to be able to solve them generically. —Smári McCarthy
“Don’t confuse math problems with human problems.” —Eleanor Saitta
An interesting next step is their demand of more thorough thinking from those aspiring to politics. They warn against an information politics that says: ‘We just want our current way of living without the bad things.’ I agree —and many others with me— that idealism needs a clear and functional vision of an alternative world with an implementation plan to get there.
What then follows is a comparison between institutions and networks. I think it is very interesting to think about the importance of these two and why they have such trouble to deal with each other. What we are doing at Hack de Overheid is one attempt at bridging a network with a bunch of Dutch institutions. We should come up with more translator services and adapter structures to make the two work together.
They then treat the protocolization of institutions. How an institution can be decomposed in process and substance. How the symbolic language that an institution accepts can be codified as an automaton and then be translated into a peer to peer communications protocol. One problem of such a protocol is that it lacks institutional memory and tacit knowledge. Networks consist of nodes that adhere to the protocol (by definition) and are in effect interchangeable which means they don’t have to remember over the whole.
Memory and knowledge are essential for the proper functioning of all organizations and that functionality needs to be coded in some way into the networked version. I’m reading James C. Scott right now and he talks at length about the high modernist folly of laying down ‘thin and brittle’ structures that do not work. Such structures have not been tested or used enough and lack the pliability and adaptations that are necessary for proper functioning.
Saitta and McCarthy propose to build institutions that only do long-term memory and let the process execution be handled by the network.
They then identify the open problems that still need work:
Mapping the complexity classes and executive processes of institutions
A language for protocolization of executive processes
A decentralized but collectivized and compellable taxation protocol for an anonymous crypto currency
Better tools for network-instution interactions
A concept of network jurisprudence and mercy
The complexity theoretical treatment of social institutions is something that rather tickles my fancy. On university we never got to solve anything but the most theoretical of problems during those courses. I recently found some complexity theoretical treatments of games (“Classic Nintendo Games are (NP-)Hard”) and I look forward to even broader applications.
To stay in the vein of games, the problems stated in 1. and 2. are things that have a lot in common with what we do when we build games. The design of games consists of many similar information theoretical problems. Games may also be good staging grounds if you want to replace the nation state. The first thing that comes to mind to model these interactions is Joris Dormans’s Machinations, a finite state machine modeling tool.
Anyway it looks like there are tons of important and interesting problems still to be solved to which we as game practitioners might be able to contribute as well.
There are philosophical problems that we need to solve but they need to be directed towards the real world. —Eleanor Saitta
After the talk there follow a series of somewhat odd questions. The replies fortunately more than make up for it:
You need to have a sufficiently complete philosophical understanding of why your ideas make sense and how they are coherent and how they encompass [agriculture]. Otherwise your [privacy] arguments are going to fall flat. —Smári McCarthy
Instead we should build alternate structures. We are going to build this thing over here and it’s a much better way to run things. That can sort of infect into the world and obsolete other things. —Eleanor Saitta
That last one should be the golden test of activism: are you just complaining or are you doing something to actually make things better? If not, why not?
A couple of weeks ago I and judging from Twitter almost everybody I knew read Quinn Norton’s Eulogy for #Occupy. Her coverage for Wired and her twitter stream had already broadcast an almost minute to minute beat of events in the movement. That account finally culminated in this retelling of the camps and the evictions crowned with a tally of the movements hopes and achievements. It is one of the journalistic highlights of 2012.
Oddly such a comprehensive account has not been available for Europe. We have had camps near the financial districts too, not to mention a massive amount of political conflict in the Mediterranean countries. All these things are tied up in the monstrous Union we have wrought to hold each other in a technocratic stranglehold. We are interrelated, however difficult it may be to tell from the national coverage alone.
Our working theory was that most European journalists don’t have the stones to endure what Norton has gone through, to really be ‘in, but not of, Occupy’, to cover something beyond the confines of the nine-to-five job. To be sure I checked with her:
@alper mainly the guardian. i never found anything for the continent.
This means that not one journalist conversant in English/German/French/Spanish on this continent figured out that there may have been a story here worth pursuing? That not one newsroom freed up the resources necessary for somebody to cover this? If that is the case, then may all our newspapers shrivel up and turn to dust because there is nothing worth saving here.
I just pulled out this stuff from my weeknote into a separate post because I think it merited it.
I was already in the Hague Saturday when the event that prompted my visit happened: we held Apps voor Democratie, a Hack de Overheid hackathon in the Dutch parliament building on invitation by the chairwoman Gerdi Verbeet of our parliament. For this event they also for the first time opened most parliamentary proceedings.
I cannot stress how nice it was to be welcomed into the highest institution of the Netherlands and then hear that institution say that they realize now that openness with their data is the way to go. The atmosphere of the entire day was incredibly positive and uplifting. This event has been a world premier and has set a high bar. But don’t let that stop ups from doing even better.
A rather interesting capitalist reflection on Facebook by Rob Horning at The New Inquiry and why online activism never changes anything.
Thus, according to Read, a fundamental problem for capitalism is how to maintain a supply of workers who are (a) flexible, creative, and motivated at the same time they are (b) manageable, controllable, and predictable. That seems to explain social media’s underlying ideological function. Not only do social media provide a basis for neoliberal subjectivity, affording us hands-on experience of neoliberal prerogatives and pleasures: branding ourselves, proving our flexibility, maneuvering ourselves into less precarious places in always-reconfiguring networks, and so on; they also serve to contain that subjectivity and neutralize it.
A couple of days ago I got an answer on behalf of Ms. Neelie Kroes with regards to my inquiry about computational literacy (which I asked during her visit to Berlin during re:publica):
OCR’d it says:
Dear Mr. Çugun,
I would like to thank you for your message to Mrs. Kroes. She has asked me to respond to you on her behalf.
I fully share your views that educating our children to become computationally literate is an important topic which should be taken into account in our educational systems. We are indeed aware of the recent debate in the UK, and the studies and discourse papers published on suggesting reforms so as to give a higher prominence to information and communication technology (ICT) in the school curriculum, including programming skills.
As part of the Digital Agenda for Europe, we have been promoting the vision of Every European Digital and the mainstreaming of ICT int he national education systems as a catalyst of innovation and modernisation of education. There are good examples in Europe in this regard, but still much needs to be done before we would see our children widely taught and working wit the new technologies in every course. This would in itself provide a good level of ICT skills to our pupils.
For the future, ICT and learning are high on te Digital Agenda, and we are committed to contributing to educating our European youngsters with the ICT skills they need to succeed in the 21st century.
Yours sincerely,
Khalil Rouhana
We have a long way to go, but we need to push this in every way possible.
