10th January 2011, 3 min read

Our institutions are limited by the pre-digital technology

Much of our institutions are limited by the pre-digital technology: (1) It is difficult to constantly re-edit a paper book; (2) without computers, global trade requires perennial currencies ; (3) without information technology, any political system more fluid than representative democracy cannot scale up to millions of individuals. These embedded limitations still constrain us, for now.

• We teach kids arithmetic and calculus, but systematically fail to teach them about probabilities. We are training them to distinguish truth from falsehoods, when most things are neither true nor false. Meanwhile, sites like Stack Overflow and Math Overflow expose these same kids to rigorous debates, much like those I imagine the Ancient Greeks having. We are exposing the inner workings of scholarship like never before. Instead of receiving knowledge from carefully crafted books and lectures, kids have to be trained to seek out truth on their own. The new generation will expect textbooks to editable, like Wikipedia. You might be 16, but you can still correct a professor. But the 12 years old next door can correct you too. Are we still going to have static books, idealized in some “final version”? I think that books and journal articles will have to become dynamic, or they will grow irrelevant.
• Why do we need central banks and currencies? Because they, alone, can ensure determinism and stability? Why can’t we have several competing currencies? In any case, how wealthy is Mark Zuckerberg? Financial determinism is an illusion. There may be a picture of the Queen on my dollar bills, but the authority of the Monarch does not protect the value of this currency. If not for their fear of upsetting local governments, VISA and Mastercard could create a new currency in an instant. If not for government regulations, Paypal would be competing with central banks. Suppose that I help a game company. Maybe they could pay me with their in-game currency. Many people worldwide would be willing to trade this currency against other goods and services. At no point do I need to print money! We could even automate the process. I get some in-game currency and I want to buy food, can a computer arrange trades so that I get bags of rice delivered at my home? Of course, it can. Obviously, governments would start regulating because, these sort of trades effectively cut the government out. But I think it would be very difficult to outlaw or regulate these trades in a context where the financial markets are driven by algorithms.
• We expect political leaders to represent the interest of an entire population. Have you ever stopped to consider how insane this expectation is? Would you trust a jury made of a single person? We have learned from machine learning that the best results were typically achieved with Ensemble Methods. What we need are sets of leaders, automatically selected and weighted. We don’t want the best leader, we want the best ensemble of leaders. And the best way to avoid biases is to change these leaders frequently. We almost have the technology to do it in a scalable manner. Electronic voting is only the first step toward a new, more fluid, form of politics. If it sounds crazy, consider that people spend more and more time online, where politics is very different than in our brick-and-mortal world. The models emerging online will be implemented in offline politics. That is where the political innovation will occur.