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Influence without force: the law of the Internet
The past year has seen increasing backlash and fear towards the Internet and its constituents.
Calls for government-mandated regulation are coming from all sides while Silicon Valley
wonders how influence campaigns have managed to sway an election.
It is tempting, especially for the affected parties, to see Russian influence campaigns and lack of
internet regulation as the culprit for the general sense of malaise in the Western World and its
descent into populism but that would miss two much bigger phenomena: worsening living
conditions and incorrect conceptualization of the internet.
Worsening living conditions
The rapid growth of China and emerging markets as well as the rise of “non-material” capitalism
caused capital to move up and out. It moved up, with the “rich getting richer”, because
non-material capitalism (eg. finance, tech) scales better than traditional capitalism and it moved
out towards emerging markets owing to globalization. The displacement of capital from
middle-class Western world has led to progressively better living conditions for the world as a
whole but worse living conditions at the individual level in Europe and the United States. This
new world order is the culprit for the nationalism seen across these regions.
Conceptualizing the Internet
In “The True Believer” Eric Hoffer remarks “For men to plunge headlong into an undertaking of
vast change, they must be intensely discontented yet not destitute. […] They must also have an
extravagant conception of the prospects and potentialities of the future”, in other words for
people to champion change they need to be unhappy yet sufficiently hopeful. The Internet has
been the very enabler and carrier of this hope, as evidenced in the Arab Spring and Trump
alike. For an industry to be able to shape minds and spread hopes of such a diverse and
dispersed group of people is extraordinary.
This realization enables us to posit that unlike any other booming industry, technology is unique.
No other industry in the past has had the ability to create a new world, a domain in military lingo,
where people have a virtual life, an identity and participate in their own unique flavor of “res
publica”; where people are citizens as much as they are consumers. It is therefore useful to look
at the Internet as the natural evolution of a Nation State, an entity in which there are myriads of
co-existing tribes yet this State is not concerned with most of its traditional functions such as
public defense, welfare and so forth.
Looking at the Internet as a New Nation State is not merely an exercise in theoretical metaphors
and awe for human ingenuity; it provides a practical mental model to address the problem of
nationalism and worsening living conditions.
Need for a social contract of the Internet
But if the Internet is a State of its own, it lacks the characteristic kinetic force of a Sovereign
State but wages its power through influence (in this sense it is more similar to the Vatican). If
traditional states dictate through laws, the Internet does so through code. Whether the Trump
campaign and Russia have understood the laws and leveraged the laws better than anyone
else is not as important as realizing that the Internet and its dominant players, as State and
major constituents, have a responsibility to create a more cohesive, transparent and equitable
social contract:
1. Leverage internet players’ assets for welfare:
a. Use machine learning and the trove of data available on the Internet to improve
people’s decision making abilities when it comes basic needs (e.g. optimizing
healthcare, living location, school choices etc.)
b. Use the power of networks to boost socially cohesive messages or provide safety
(e.g: companies that help reporting sexual harassment or racial discrimination)
2. Leverage the computational power and data availability to build crowd-based business
models:
a. Balance sheet based businesses that thrive on the law of large numbers are a
good example of businesses that could provide a source of profit for Internet
citizens (eg: LendingClub vs. traditional lenders)
b. Rewards for reduction of information asymmetry is another avenue through which
the public could benefit from the Internet
But for the above framework to work and for the Internet to thrive while keeping its citizens
happy, there are a number of technical challenges that need to be resolved:
1. “One person, one vote” voting system but with the ability to preserve pseudo-anonymity
2. Increase transparency on the “laws” of the Internet, its governing algorithms and
protocol:
a. Visibility and integrity: how do they work and how to verify they cannot be
tampered with
b. Accountability: who is held accountable in case of failure
c. Explainability/Auditability: why the code has made a certain decision
3. Improve the state of homomorphic encryption and machine learning protocols that work
on data streams vs data at rest
Solving the technical challenges above as well as funding companies and initiatives that fit in
the framework for social welfare will oil the function of the Internet as a Nation State. This, in
turn, will allow Internet citizens to express “intended behavior” as well as profit from scale. Being
heard and improving living conditions are the best medicine against discontent and
protectionism.