An uncountable number of people have said this or something similar to me about Twitter. I’ve stopped responding. It’s the same kind of faux snobbery that causes people to look down on Facebook, YouTube, Angry Birds, smartphones and the whole of digital life generally.

Of course, these days, hardly anyone puts down the Internet in total, but this was common 10 years ago. Today, it is more common to put down popular applications of one sort or another, always with the message that my time is too valuable, I’m too serious for this kids’ stuff, I don’t go for the superficial fripperies that have enchanted Generation Mindless.

I’ve already discussed Facebook, LinkedIn and Pandora, and why their popularity is not only justified, but they have also made gigantic contributions to human well-being. They all use the power of individual volition and the self-organizing dynamic of free association to offer services, methods of learning and means of connecting with others that break through barriers that have existed since the beginning of time.

Let’s take on Twitter, the service that people love to hate the most. Among the nonusers, the word alone is almost always said with a sneer. It is the most transparently easy of all the popular social applications, but also the hardest one to integrate into your life if you are not already part of a set people using it.

Adults sign up to it and then sit and stare at it. Having no followers and following no one, the thing looks and feels as dead as Marley’s ghost. Of course, you could always send out news of the sandwich you ate for lunch, but what’s the point? In this sense, Facebook provides that much-more-immediate satisfaction that adults (ironically) demand from websites. Twitter is an application that has to be built by you.

But consider… when the unemployment numbers come out, I usually get an email from the Bureau of Labor Statistics. This most recent time, even before that email arrived, I knew the numbers before. I knew the grim truth behind the numbers. I had a sense of how several major newspapers were spinning the numbers. I had access to charts that were being posted, showing how labor trends interact with other trends. And I was able to react to the news myself by reposting what I appreciated and then adding my own thoughts. Then, finally, the email arrived from the Bureau.

This is an example of an everyday use of Twitter. But it is only one of an infinite number of possible uses. And once you start and get the hang of it, downloading the app and following things you care about, you begin to realize something absolutely astonishing about this seemingly superficial thing. Twitter has radically individuated, democratized and universalized the consumption and production of all forms of information, turning the whole world into a customizable communications bazaar like no generation in history has ever seen.

This customizability is what gives rise to the caricatures of the tweeter as a superficial twit, wasting time blabbing on about nothing to other similar types. But when you see people in revolutionary political situations organizing themselves, using tweets and evading the boot of the dictator by using Twitter to communicate, strategize and outmaneuver the most-powerful armies, it should make you stop and think.

As a means of producing of information, every user has potentially the same influence as every other user. The only possible difference concerns the number of followers you have (I have 700, while Lady Gaga has 20 million), but even that is not really a final determinant, since every message can be re-tweeted and a message sent to one person can turn into a message sent to 140 million people in a split second.

What this means that is The New York Times and White House have exactly the same technical power to influence as the person who just took my order for beer at the pizza shop. The difference in the reach of messages is entirely determined by other users of Twitter, thus resulting in a crazy meritocracy of distribution.

As a means of consuming information, you have access to the instant thoughts of every star, mogul, institution, official or whomever and to the exact same extent as the big-time reporters or other institutions. And it turns out that people like Lady Gaga really like this. Every public figure does, except perhaps the dictators threatened most by this powerful means of instantaneous truth telling.

Currently, Twitter is handling 1.6 billion search queries per day and being used to send some 340 million tweets in the same period. It’s consistently in the top 10 most-popular websites. The service is offered to every person on the planet at no charge. The revenue model is to charge companies for promoted tweets in search results, as well as to charge large Internet companies for the use of applications that display Twitter feeds on their websites.

There’s a rude awakening, however, for anyone who thinks he or she can jump onto Twitter and make a splash. You cannot invite others to follow you. People have to reach out to you, and therefore, in this sense, Twitter can be a more-difficult nut to crack than Facebook.

Your first step should be to follow institutions or people you care about. They will be notified that you have followed them. One hopes, then, that they will respond by following you, but there is no way to make them do so. If you seek followers, your best approach is to find someone who is already deeply embedded in this world to recommend you to their followers. But even then, it is a long haul to get to the point that you have a substantial number of people caring about what you are saying.

Why should you bother at all? There might be someone who has no interest in what anyone has to say and also has nothing to say himself, and plans to maintain this attitude from now until death. That person has no use for Twitter. For everyone else, it is great source for acquiring and relaying information on anything and everything, and therefore, there are few people on the planet who would not benefit.

For career builders, a war chest of Twitter followers is part of the personal capital that you accumulate and carry with you wherever you happen to live or work. In this sense, this can be an essential part of your freedom and personal empowerment. It reduces your reliance on institutions and helps you gain control of your life.

For public personalities, it is obviously rather indispensable. But the same is true for any business. If you assemble followers (I love to follow businesses!), you can immediately reach them with special deals and announcements and do so at zero cost. What could be better than that?

For any individual, there are always times when you need others and it becomes important to get information to them. You might be in danger. You might have amazing news. You might need to send for help. In those times, you will be glad that you have prepared by assembling a valuable network of people who care whether you live or die. Certainly, the state doesn’t much care, so it is up to us to form associations that do.

This is why I’m most interested in Twitter, in its uses of building a global movement for human liberty against the despotism of the state in every nation. Twitter disregards borders. It disregards states and their pretensions. It follows no one’s plan. It obeys no authority. It proves the capacity of free people to be self-ordering.

It enables individuals to be self-governing units with an important element of empowerment in their hands: the ability for one person to reach the globe in any instant in time with the most-valuable commodity in existence — namely, information.

That’s why Twitter is amazing.

Regards,

Jeffrey Tucker

Why Twitter Is Amazing was originally featured on Whiskey and Gunpowder. Visit Laissez Faire Books for the best selection of libertarian book titles.

What is the logic, the driving force, the agent of change?

Yes, the software works fine, and yes, the managers and owners have entrepreneurial minds. But the real secret to Facebook is its internal human gears — the individual users — which turn out to mirror the way society itself forms and develops.

The best way to see and understand this is to compare the workings of Facebook with the workings of the democratic political process. Watching Facebook’s development has been fun, productive, fascinating, useful and progressive. The election season, in contrast, has been divisive, burdensome, wasteful, acrimonious and wholly confusing.

That’s because Facebook and democracy work on entirely different principles.

Facebook is based on the principle of free association. You join or decline to join. You can have one friend or thousands. It is up to you. You share the information you want to share and keep other things from public view. You use the platform only to your advantage while declining to use it for some other purpose.

The contribution you make on Facebook extends from the things you know best: yourself, your interests, your activities, your ideas. The principle of individualism — you are the best manager of your life — is the gear that moves the machine. Just as no two people are alike, no two people have the same experience with the platform. All things are customized according to your interests and desires.

But of course, you are interested in others too, so you ask for a connection. If they agree, you link up and form something mutually satisfying. You choose to include and exclude, gradually forming your own unique community based on any selection criteria you want. The networks grow and grow from these principles of individualism and choice. It is a constantly evolving, cooperative process — exactly the one that Hans-Hermann Hoppe describes as the basis of society itself.

Democratic elections seem to be about choice in some way, but it is a choice over who will rule the whole mob. It provides the same user experience for everyone, regardless of individual desire. You are forced into the system by virtue of having been born into it. Sure, you can choose to vote, but you can’t choose whether to be ruled by the voting results.

In this democratic system, you are automatically given 220 million “friends” whether you like it or not. These fake “friends” are given to you because of a geographic boundary drawn by government leaders long ago. These “friends” are posting on your wall constantly. Your news feed is relentless series of demands. You cannot delete their posts or mark them as spam. Revenue is not extracted from advertising but collected as you use the system.

Nothing is truly voluntary in an election. You are bound by the results regardless. This creates absurdities. This is incredibly apparent in the Republican nominating process. If people under 30 prevailed, Ron Paul would win. If religious families with several kids prevailed, Rick Santorum would win. If chamber of commerce members prevailed, Mitt Romney would be victor. It all comes down to demographics, but there can be only one winner under this system.

Therefore, an election must be a struggle between people, a fight, a wrangling around, a push to assert your will and overcome the interests and desires of others. In the end, we are assured that no matter the outcome, we should be happy because we all participated. The individual must give way to the collective.

We are told that this means that the system worked. But in what sense does it work? It only means that the well-organized minority prevailed over the diffused majority. This is about as peaceful as the kid’s game “king of the mountain.”

Facebook has nothing to do with this nonsense. Your communities are your own creation, an extension of your will and its harmony with the will of others. The communities grow based on the principle of mutual advantage. If you make a mistake, you can undisplay your friend’s posts or you can unfriend him. This hurts feelings, sure, but it is not violent: It doesn’t loot or kill.

Your friends in Facebook can be from anywhere. They “check in” and plot their journeys. Whether your friend lives in or moves to Beijing or Buenos Aires doesn’t matter. Facebook makes possible what we might call geographically noncontiguous human associations. Language differences can be barriers to communication, but even they can be overcome.

Democracy is hyperbound by geography. You vote in an assigned spot. Your vote is assembled together with those of others in your county to produce a single result, and therefore, your actual wishes are instantly merged. They are merged again at another geographic level, and then at the state level and, finally, at the national level. By that time, your own preferences are vaporized.

Sometimes people get sick of Facebook. They suddenly find it tedious, childish, time wasting, even invasive. Fine. You can bail out. Go to your system preferences and turn off all notifications and take a sabbatical. People might complain, but it is your choice to be there or not. You can even delete your account entirely with no real downside. Then you can sign up again later if you so desire or join some other system of social networking.

Try doing that to democracy. You can’t unsubscribe. You are automatically in for life, and not even changing your location or moving out of the country changes that. It is even extremely hard to delete your account by renouncing your citizenship. The leaders of the democracy will still hound you.

We can learn from Facebook and all other social networks that the Internet has brought us. These are more than websites; they are models of social organization that transcend old forms. Make the rest of life more like a social network and we will begin to see real progress in the course of civilization. Persist in the old model of forced democratic community and we will continue to see decline.

Regards,

Jeffrey Tucker

Why Facebook Works, And Democracy Does Not was originally featured on Whiskey and Gunpowder. Visit Laissez Faire Books for the best selection of libertarian book titles.

So what? Well, none of this could have happened 10 years ago. Not only that, you would probably wouldn’t have understood the paragraph in the slightest because it contains words and actions no one had heard of. Had I told you in 1992 that in 20 years, virtually anyone would be able to speak in wireless real-time video to anyone else on the planet, even to the point of sharing a real-time digital experience, you would not have believed it.

And if I had added that the technology was not outrageously expensive, but rather being carried around in the pockets of students and commuters everywhere, this would have seemed too outrageous for science fiction. What amazing force in the universe hath rained down such blessings on us mere mortals?

The truth is that we all live in a world today that would have been unimaginable to us only very recently. It is so much woven into our lives that we don’t think about it much anymore. And contrary to the rap on the digital age, that it is all about geekery and gadgetry, the real driving force behind this innovation is the flesh-and-blood human being and the oldest desires known to humankind (such as wanting to stay in touch with family).

Another quick example. I was emailing with a U.K. choir director two nights ago, and I mentioned a book of chanted music. He hadn’t heard of it, so I sent him a link, from which he downloaded the material (that magic click that creates a copy!). This morning, his choir sang the piece in church halfway around the world, and he let me know that it was fabulous.

Here we have it: digits flying over oceans in a matter of seconds, and then embodying themselves in beautiful music, sung now with the same human energy as music was sung in the ancient world, that transforms real lives. The person kneeling to prayer didn’t know and didn’t need to know how the music arrived there. The technology is just the means; the end is the improvement of human life.

Such cases like this are only a tiny snapshot of two things I can briefly recall. Just today so far, I’m sure I’ve read articles I never would have seen, talked with people I would have long ago lost touch with, found out about events that would have remained forever unknown to me, connected with someone who found something I said interesting enough to consider…and just now, I recall that I heard word that a friend with asthma is out of out a Shanghai hospital all safe and sound. None of this would I have known only a few years ago.

Again, ask the question: What is causing all of this amazing change? What is the driving force, the source of the manna, the wellspring of all this avalanche of human progress?

I’ll tell you what is not causing it: politics. It’s the great lie, the most-gigantic drain of valuable human energy ever conjured up in the mind of man. What is politics but a grand argument about how we should rule each other? Meanwhile, every step forward in history has come not from this task, but a completely different one.

American politicians are always running on a platform of change. They explain how their policies will make your life better. They map out timetables. They present a portrait of a future. Above all else, they presume that the future is theirs to control, and voters often go along with this idea. As an example, look no further than the history of the State of the Union address.

What if none of it is true? Just think about education. Everyone has a plan for how to improve what exists. So it has been for a hundred years. Meanwhile, the private sector, through physical and digital technology, is reinventing the entire enterprise from the ground up through every possible means. This decentralized, private-sector-driven, technologically sophisticated education reform is making it almost impossible not to be educated about something with each passing hour.

Online academies are opening by the day. Universities are putting their courses online for free. For-profit companies are distributing every manner of teaching tool one can imagine. For-profit learning centers are opening in every town, all making a buck from teaching kids what the public schools have failed to teach. For that matter, the History Channel alone offers more sweeping programs than any public school textbooks two generations ago.

Anyone in the world can be a teacher to the world today, with a laptop and an Internet connection, and so, too, anyone can be student.

It’s true in health care reform, too. For all the problems in the pricing system and terrible insurance system, health care is getting better, mainly due to private-sector innovations. The best radiologists in the world can examine your scans in minutes, no matter where they actually happen. Access to medical information is no longer trapped in a dusty book but flies all over the world from hand-held devices. Error is more likely to be corrected this way, saving and changing lives.

Society is not waiting for the politicians. When you listen to what they say, when you watch what the bureaucrats do, when you look at what the agencies are regulating, you suddenly realize that the political monstrosities that burden the world are hopelessly out of touch with the kind of progress that people are experiencing in their daily lives now.

Politicians can make the world a worse place, to be sure. But if you look at the actual trends that are driving change in a positive direction in our world today, none of them is inspired by political initiative. They take place outside the public sector, and even outside the purview of the politicians and bureaucrats. Sometimes it seems as if the political class is clueless that the world has long ago moved on.

What is driving the world in a forward direction? It is people connecting with people through free association, communication, money exchange, enterprise, risk taking, commercial aspirations and the practical arts. And from these forces, we are newly discovering the wonderful fruits of civilization: arts, music, philosophy, faith.

And truth. Truth above all. The truth that is all around us, the one that the public-sector machinery somehow cannot and will not see, is that global society is making a future for itself without the help of the world’s self-described public servants. The state in all its manifestations struts and preens — builds monuments to itself and waves its flags — but when it comes to really making change, we must look elsewhere.

Regards,

Jeffrey Tucker

How Change Happens was originally featured on Whiskey and Gunpowder. Visit Laissez Faire Books for the best selection of libertarian book titles.

The first shock was the realization that the gigantic protest against legislative moves (SOPA and PIPA) that would smash the Internet turned out to be superfluous. The thing everyone wanted to prevent is already here. SOPA turns out not to be the unwelcome snake in the garden of free information. The snakes have already taken over the garden and are hanging from every tree.

The second shock took a few days to sink in. It could mean that the whole way in which the digital age has functioned is in danger, or even doomed. This is not a forecast. This doom is all around us right now.

The problem is this: Megaupload was accused of violating copyright through its file-sharing technology. This permits users to upload their own content and permit other users into their space. If anything that one person uploads is of uncertain copyright status — it could be anything, really — sharing it would then seem to amount to a crime.

For some years, the feds have unnecessarily harassed people for nonviolently streaming or sharing content. This has had something of a chilling effect and increased the use of IP-scrambling proxies to keep online habits from being traced. College kids know this all too well. Masking IPs is just the way they live and work.

The attack on Megaupload takes all of this to a different level. This was not some wholly surreptitious, sketchy institution that was trying to get around the law. It was already becoming a legitimate service for launching careers in music and art generally. It seemed to be doing exactly what we expect in the digital age. It was reinventing an old model for new times through innovation in production, delivery and profit sharing.

As I wrote before, this was most likely why the old-line industry came after them. It was not the illegal activities, but their legal ones that made them a target. The moguls do not want change. They crushed the competition.

At the same time, the actual legal rationale that the feds used to blast these people away was their supposed violation of intellectual property through file sharing.

Which raises the question: Is every site that makes file sharing possible in danger? Consider Dropbox, the hugely popular service that allows you to put your files in the cloud and create special folders that share them with others. This allows people to work on shared folders in a collaborative way, and prevents the inevitable problem of version control that comes with emailing back and forth.

How exactly is Dropbox different from Megaupload? It is not that different. It is staid and scholarly, rather than flashy and jazzy. It’s interface is plain and neat, rather than colorful and upbeat. Otherwise, it is hard to qualitatively distinguish one from another.

Dropbox is hardly alone. As TechCrunch puts it:

“Several digital locker services operate like Megaupload. RapidShare and MediaFire are two of the larger services. But these sites have undergone a face-lift recently and at least appear to be much less nefarious than they once were. Other services like Dropbox, iCloud, and Amazon S3 are open to hosting any file type a user uploads. They also make sharing easy, but in a way, that’s a lot more private than Megaupload. Still yet, there are sites like Zoho in which users can easily share content, content that could be copyrightable. But the prime goal of all these sites is open file sharing — just like Megaupload.”

It is hard to see how any file-sharing site can pass muster under the new regime. There are plenty more like SugarSync and FileSonic. As Ghacks points out, users of the latter were greeted with the following ominous message just this week:

Question: What value is a file-sharing site if it doesn’t permit the sharing of files? It becomes a thumb drive in the cloud. Maybe that is a bit of convenience, but it is not highly marketable or useful.

Another tactic that file-sharing sites are using after the Mega attack is to outright ban U.S. users in hopes that this will somehow immunize them from the terror attacks being used by the U.S. government. Thus were American users greeted with the following:

Americans look at China with shock that the government doesn’t allow access to a huge amount of the World Wide Web. But look: It is happening right now in the United States, but in an indirect way. This has been called a “virtual Iron Curtain” that is being thrown up around U.S. borders. It has already happened to banking. We are seeing the first signs of this on Internet access.

Another site called uploadbox.com has decided that it will no longer deal with the risk of these kinds of terror tactics and plans to shut down completely at month’s end.

What else? Google Docs allows file sharing and has solved so many problems as a result. This has been a great advantage of this innovation. I use it every day. It is essential. But it is in danger. What about Facebook? I could post a copyrighted image there right now and share it with thousands. Facebook thereby becomes an accessory to the same crimes that Mega is alleged to have abetted.

For that matter, what about email? When I send a file, it doesn’t remove it from my machine. A copy is made and made and made again. Who and what is to say whether what is sent or received is proprietary and made it through all the legal hoops? In the last several weeks, I’ve actually received emails expressing fear of sharing links to public sites!

All these changes go beyond the traditional “chilling effect” of random attacks on free speech and free association. This is a sudden and outright freeze, one that is devastating for the whole way in which the Internet has come to exist. What is called “file sharing” is the unique service that the Internet provides. Without that, the Internet becomes an efficient post office or another means of delivering television-style content.

The reason that the Internet has been the driving forced behind economic growth, political change, social progress and the general uplift of humanity is its capacity for taking scarce goods and converting them into nonscarce goods of infinite duplicability and availability. Information, media, data and images that were once captive of the physical world — paper and ink, film and bankers boxes — have been freed into another realm so that they can serve and enlighten the whole of humanity.

This has happened because of the miracle of duplicating digital goods that are driving economies in the digital age. To ban duplication and file sharing today is no different from banning flight in the 1920s, banning steel in the 1880s, banning the telegraph in the 1830s, banning the printer in the 1430s and banning the wheel and sail at the beginning of mankind’s advance out of the cave.

It will set humanity back. It violates liberty. It attacks everything that constitutes and defines the times in which we live. It replaces a world of sharing and thriving with a world of violence and technological regression. The Internet will continue to exist, but it will take a different form. Large sectors will have to thrive behind very secure pay walls and only within private digital communities.

And who is doing this? The U.S. government. Government in league with old-line corporate elites.

And what is the official reason? To enforce “intellectual property.” It has really come down to this: Either the whole basis of copyright, trademark and patent are scrapped or we could see the death of the digital age as we know it. So long as IP is enforced, the U.S. world empire can continue to roam the world seeking whom it may devour.

Regards,

Jeffrey Tucker,

The Death of File Sharing was originally featured on Whiskey and Gunpowder. Visit Laissez Faire Books for the best selection of libertarian book titles.

All of this is true. But what Black Wednesday demonstrated is exactly the opposite point. Major parts of the Web withdrew their consent in protest against legislation in Congress that would have a devastating effect on how the Internet functions. Instead of being a sanctuary from power and control in which information is freely produced and distributed, it would become a delivery system for government/corporate-approved content not unlike the radio of 1930s or the television of the 1950s.

This legislation would transform our lives. The Internet declared its opposition with conviction. The institutions rose up by posting blackout notices, banner ads and messages of open defiance. It was a peaceful protest not unlike those of the past, but with a gigantic difference. Instead of being limited by geography and, therefore, easily ignored or broken up by police, the digital protest was global, impossible to ignore and could not be stopped. It applied to the English-speaking world, but all language groups become involved because the effects of the legislation would be truly universal.

It is always a risky venture to stand up to power. You face loss of commercial traffic. You face the possibility of reprisal, even violence. You face the real possibility of losing the fight and, therefore, not being declared a hero, but rather a fool. And if we look at the sweep of history, we can easily see that the odds of winning against power are extremely low. Liberty is a rarity in history for a reason. Despotism has ruled the day in most times and most places. People who chose to fight the power have to begin with this understanding.

It is only when a few people of conviction stand up to power and their protest is backed by some level of public consensus that the difference is made. It has happened rarely, but look at the effects. The liberty won through withdrawing consent built the modern world. Everything we use to better our lives is a product of this liberty. Our health, education, material prosperity, arts, faith, music and philanthropy all owe their greatest debt to liberty, not to government.

A convenient marker to signal the beginning of the digital age is the invention and popularization of the Web browser in 1995 — at least this is the way I tend to think of it. That means that we’ve had 17 years of seeing what free information flows can produce, and it is nothing short of astounding. We take it all for granted day to day, but when you step back to look, the transformation seems like miracle.

Anyone can communicate in real-time video at a near-zero price with anyone else in the world. At our fingertips, we have all the world’s great literature, music, poetry and science. It is the key to our social networks, to educational efforts, to healing and cooking and every other life activity you can think of. And it all traces to that amazing thing: the ability to share and exchange ideas in whatever form.

Most of the time, people take for granted the products of freedom once they come into being and never stop to imagine an alternative. People go about their daily lives enjoying amazing blessings unaware of what made them possible, and they do not imagine a world in which it could all be taken away.

Even today, in former socialist countries, the young generation has little appreciation of the fact that only a generation ago, the shelves were empty and the life was grim and without hope. In the U.S., we just expect and anticipate — almost as a human right — the newest digital toys, the latest upgrades, the ever-more bug-free environment of software lives. We saunter around stores and pick and choose from among the world’s bounty and think nothing of it.

This is a serious problem because liberty requires awareness of its blessing to survive. Somehow, and against all odds, the debate over the technical details of the enforcement of intellectual property has sparked some degree of awareness. The protest has been cast as one against censorship, and it is indeed that. It is good to think about the counterfactual reality of a world of information gone dark.

But actually, there is more at stake than that. Information is the essential building block of what we call civilization, of all the things that improve the human condition. It is about more than what we can see and what we can read; it is about the human right to share and exchange ideas that makes progress itself possible.

The anti-SOPA movement has been one of the most exciting protests I’ve seen in my life. It seemingly came from nowhere. It was built over the course of just a couple of months. The tipping point came when Wikipedia announced that it would join the protest. Then it seemed like everyone got involved, and over the course of just a few days. Programmers wrote applications to block out websites. Millions changed their Facebook profile pictures (hey, it’s a lot easier than a hunger strike!). Congress was flooded with messages of opposition as never before.

And who and what started all of this? Strikingly and notably, it was the “conservatives” — or even the “libertarians” — who continued to be oddly confused by the whole topic. It was the “civil libertarians” and people associated with what is commonly called the “left” that became the machine behind the protest. This is a beautiful demonstration that you never really know for sure where to find the true friends of liberty.

People have asked for my speculations on the future of this legislation. My guess is that this protest will effectively kill the current versions of the bills in Congress. They will be tabled, and the corporate interest groups pushing them will quiet down. Then in the summer and fall, it will all start up again with less-objectionable legislation that claims to remove the offending powers, but, in reality, does largely the same. Will the protesters sit this one out, or will they see that eternal vigilance is the price of liberty? In the end, the freedom of the Internet can be guaranteed, not just by stopping new legislation, but by repealing old legislation. In this respect, this protest represents not an end, but a beginning.

Regards,

Jeffrey Tucker
Executive editor,
Laissez Faire Books

Protesting Government Digitally was originally featured on Whiskey and Gunpowder. Visit Laissez Faire Books for the best selection of libertarian book titles.

There is something wildly implausible about all of this. The truth is that the government is behind the private sector in its pace of innovation, and even in its adoption and use of private technology. Just look at the post office! It’s pathetic. And a decade after households had PCs connected to the Internet, government offices were still using typewriters and triplicate. It’s been this way for a very long time. Government doesn’t invent anything, and it is a very late adopter of what the market does bring to market.

Another implausibility of these movies is that the government’s gizmos work most of the time. That’s not true, as the modern history of “smart bombs” illustrates. Without access to a market for replacement parts or a market to test and improve technology on the margin, the government’s innovations depreciate quickly and end up being highly unreliable. Anyone who has spent time in a government bureaucracy can tell you the stories.

Where does the idea come from that government has the cool gadgets? It is probably a result of World War II, and the atom bomb in particular. The legendary Manhattan Project, initiated by Franklin Roosevelt in 1939, ended up creating the ghastly and immoral nuclear bomb that annihilated a quarter of a million people at the end of the war. That made an impression and generated the myth that government, because it has access to more resources and people than free enterprise, can create more-impressive technology.

It’s one thing to build weapons for mass killing and another thing to invent things that improve life. The private sector never had a reason to invent a weapon of mass destruction, which accounts for why government did it first. The lesson is generalizable across a wide spectrum of technology. In real life, the private sector pushes out the horizons one step at a time, with a constant stream of new releases that improve the old, each tested against user experience and economic viability.

My reason for bringing this up is to praise a movie that has dramatically broken from the usual pattern. The movie is Mission: Impossible — Ghost Protocol. I know what you are thinking. You are thinking that you can’t stand the sheer unreality of these movies, the way Tom Cruise can fall 30 feet onto a steel surface and bounce off mostly unharmed, the way these car chase scenes feature antics that couldn’t be realized by the best Nascar driver and so on. And that is all true for this recent release too (but hey, they are supposed to be fun movies, so lighten up!).

But there is one extremely important respect in which this film truly gets it right: It seems to be the first in this genre that fully understands that private technology is better than government technology.

Most of the government’s own equipment in the film is flaky. The fancy gloves that allow you to climb up windows on skyscrapers fail. The right-hand glove somehow shorts out or maybe the batteries die or something along those lines. It makes this electric sputtering noise and shuts down, nearly killing agent Ethan Hunt.

Then, in another scene, the wonky tractor magnet that is supposedly creating a levitating force field flies out of control and nearly kills another agent.

The government’s technology is so bad that even the amazing mask-making 3-D printer shuts down unexpectedly, requiring the agents to enter into high-level negotiations as themselves! Not even the signature of all Mission: Impossible movies can exist, due to government incompetence.

And there’s another case…An agent is supposed to wear this contact lens that secretly takes pictures of paper, and then these pictures are automatically printed in a remote location. Taking the picture requires that you blink twice. The enemy agent happens to notice this peculiar blinking habit, and further notes that his eye has a strange crossword shape in the retina and orders the agent to be killed immediately!

Nothing the government has given them for their mission works right!

But what about the private sector? Hilariously, the mission with its famed self-destruct message is delivered on an iPhone (in the one scene in which it is not, agent Hunt has to bonk the Soviet-era payphone to get it to go up in smoke).

The agents all use iPads to accomplish their amazing techno feats. They use the iPads’ scrolling technique to cycle through pictures of enemy agents. And all their computing is done with the very conspicuous use of MacBooks.

It’s as if the filmmakers sat down to think of cool stuff and realized that there wasn’t anything cooler than you can buy right now from Best Buy, so they finally decided to throw in the towel on the old idea that the best gadgetry emerges from a government lab.

As for the remaining government stuff, it is the usual assembly of dangerous weaponry and satellites. It’s all left over from the Cold War and can only be used for evil.

The message is then clear: Government technology is malicious, outmoded or ineffectual, while the private sector’s technology is advanced and gets the job done. This amounts to a decisive turnaround, even an epic artistic shift. It amounts to an admission that that the great technological battle between the public and private sectors has been decisively won by the free market.

In that sense, the new Mission: Impossible might be the most realistic action film ever made. If you want to accomplish the impossible, you know where to turn.

The Race for the Coolest Stuff was originally featured on Whiskey and Gunpowder. Visit Laissez Faire Books for the best selection of libertarian book titles.

The down votes are what make the news. The Wall Street Journal tells the story of Scott Mitchell of Connecticut, who purchased from Best Buy and Playstation 3 for his two sons ages 10 and 14.The company let him know via an email that the goods didn’t arrive. He was furious and wouldn’t stop posting diatribes against the company. Eventually, the suits got involved and sent him his full bundle of goods at a low price plus a $200 gift certificate.

“While I can’t say I’m happy, I wound up being satisfied,” Mr. Mitchell told the Journal.

The case was cited as one of many such cases. Consumer demand was so intense that Best Buy got behind. The company didn’t have the inventory it needed to fill all requests. Cyber Monday overloaded the staff and they couldn’t respond fast enough. Any business that hears the story thinks: nice problem to have. Inventory decisions like this require daily clairvoyance.

What’s more important here is what this anecdote indicates about the social order. In this setting above, who is in control? Mr. Mitchell is just one lone guy with one problem with a company that serves untold millions. But he had a voice and his voice was heard. The company scrambled to please him.

Justice was served, and not because he was part of a big pack of people going to voting booths once every four years. There were no hearings, committees, testimonies, debates, complex systems of legislation and signings, judges and juries, regulations and legal rights. He was served because he was a consumer. One man with a credit card beat the system.

The institution that allows this great thing to happen is known as consumer sovereignty and it is an intrinsic part of the market. The preferences and rights of one individual prevailed even though he was not in the majority, even though he never registered for any system in a political apparatus, even though he had no lobbying firm or friends in high places. He complained and the giant corporate monolith bowed to his wishes. And they did so for self interested reasons. It’s bad for business to have dissatisfied customers. So the the corporate execs fell to their knees in supplication.

This is a good system. Who set it up? No one. There was no votes, no constitutions, no committee hearings, no lobbying. It emerged spontaneously from the decisions of self interested  parties. The company exists to make a profit by finding ways to get goods to people who want them. Mr. Mitchell was among those who decided on his own volition to trade with the profit-seeking company. That trading relationship is one of billions and billions that go on every day, all day, all year. Put them all together and you have what is known as the market economy.

Philosophers from the ancient world to the present have tried to imagine how to set up a society in which every individual matters, a society without exploitation, a society without violence, a society with peace, justice, and prosperity. They have usually imagined that this world would have to emerge from the political process. That is where their speculations and plans usually  begin. They were and are wrong. The society that does these things is right before our eyes and found within the framework of our own choices, actions, and trades with others.

We are often told about the evils of corporate power and the grim nightmare of the market in which we are all swallowed up by the forces of materialism and consumerism. Where is there evidence of any of this in the sphere governed by voluntary exchange?

In the market economy, the buyer is the decision maker. He or she determines what gets produced, how much, and directs the pattern of change. The supposedly powerful fat cats of the corporate world are daily submitting to the wishes of the little guy with a computer and a credit card. Any company in a market can be shut down in a matter of weeks if the consumers switch loyalties. This happens every day.

Nothing like this system exists in our dealings with the state. For years now, masses of people have been screaming about the indignities imposed upon us by the TSA. The TSA responds with a propaganda blitz designed to make us believe that they are strip searching us electronically for our own good. The institution doesn’t comply with all our wishes much less the wishes of one person. Instead it sets out to change our thinking, trying to make our mental habits conform to those with the power.

In other words, the TSA operates on the opposite principle of the free market. In the market, we are in charge and the producers slavishly attempt to find out what we think and try to conform their operations to our point of view. In government, we are told that we are the ones that must change. We must submit. We must comply. We must go along no matter what. We can choose to be grumpy about it or happy about it, but, in either case, there is no choice. We must obey. And the institutions of government never really go away.

And so it is with every government agency at all levels. The little guy doesn’t matter. There is nothing like the consumer/producer relationship that we see in operation in every instant on the market economy. Instead, the government takes our money by force and spends it as it wishes. If we don’t like the system, we are invited to slog our way to designated spots every four years and choose among a slate of drones who want to be our designated leaders.

Government vs. the market: which system is better? Granted that neither system provides utopia. The real issue is: which system is better capable of self correcting in our favor? The market does this every day. There is a ceaseless struggle going on globally with the goal of winning us over as consumers. The market is always saying: “how can I help you?” The government is always saying: “help us or else.”

Looking at the choice here, it seems rather obvious that the market – as a particular application of the principles of choice and free association – is the best approach to organizing society. No one designed it. It is controlled by us in the very exercise of our free will. It gives power to the people. The statist approach can only lead to less satisfaction, less mutual benefit, less control, and ultimately the very nightmare that we all want to avoid.

Think of all that that market contributed to your holidays and all it will do for you in the year ahead. As a form of social organization, nothing is more deferential to your needs and wishes.

Who Should Control the World? was originally featured on Whiskey and Gunpowder. Visit Laissez Faire Books for the best selection of libertarian book titles.

I’ve said repeatedly, in fact, that the company’s technology for acquiring therapeutic stem cells is flawed and obsolete. Specifically, Geron’s stem cell production technique is “heterogeneous differentiation.” In other words, stem cells are allowed to differentiate into many thousands of stem cell types. Scientists attempt to isolate or “cherry pick” the right type of stem cells and multiply them into usable numbers.

The technology doesn’t work. It’s somewhat amazing to me that it’s taken this long for the company to admit it bet wrong but it finally has. The press release, distributed yesterday, states that, “Geron Corporation … today announced that, effective immediately, the Company will focus on its first-in-class oncology programs. As a consequence, the Company will discontinue further development of its stem cell programs and is seeking partners for these novel assets.”

The scientific tools do not exist to screen and identify every single stem cell using heterogeneous differentiation. That, however, is exactly what is needed to produce a pure population of therapeutic cells using that production strategy. So the result is impure cell populations that include stem cells of unknown varieties.

Scientists who developed and supported this technology argued that stem cells require matching “zip codes” to develop. This means that, in theory, a dental stem cell transplanted into the spine would not engraft and become a tooth. Spinal nerve cells with the right biological zip codes would engraft and repair severed nerves.

So far, so good — but there’s more to the story. Stem cells with the wrong zip codes may not turn into inappropriate body parts, but they do cause problems. Geron found microcysts, bubbles of inappropriate tissues, when their heterogeneously differentiated cells were transplanted into living animals.

But I warned my readers that this would likely be the case before it happened. Therefore, my readers should not have been surprised when Geron’s first request to the FDA for clinical tests of a spinal cord therapy was rejected over concerns about impurities in the cell populations. In fact, Geron’s failures on the stem cell front were actually evidence that Biotime Inc. (AMEX: BTX) is the real leader in regenerative medicine.

As I’ve explained before, BioTime has pioneered its own pure stem cell production technology. Known as ACTCellerate, it involves the mapping of stem cell development shepherding cells through the phases of development to produce large pure quantities of identical purified stem cells. If you were at the Vancouver gathering in July, you have seen BioTime CEO Dr. Michael West present the genetic evidence that he can do this.

Then, very recently, BioTime partnered with Cornell University to commercialize a technology capable of producing large quantities of purified endothelial precursor stem cells. This is BioTime’s ReCyte technology. The patient’s own cells are first converted to become induced pluripotent stem cells, identical in function to embryonic cells. They are then potentiated to become endothelial precursors, suitable for rejuvenating the heart, vascular and immune system.

This technology will, I believe, be the most successful medical blockbuster in history. As heart disease kills most of us, it will significantly extend healthy lifespans. Moreover, it will happen much sooner than almost anybody believes. I expect, by the way, to have even more good news for you about this revolutionary therapy in weeks or months to come.

This is not to say that Geron is worthless, by the way. The company still has important assets. It is not, however, an important player in regenerative medicine. Nor has it been for some time. I foresee several benefits from Geron’s exit from the space.

First of all, financial analysts might actually be forced to look around and ask questions about the regenerative playing field. If they ask scientists rather than journalists those questions, they will have to recognize that the company run by “the father of regenerative medicine,” Dr. West, is driving the science.

The second benefit will come from the buying opportunity by widespread misunderstanding. Typically, the market responds to bad news about a single stem cell company by selling off the entire industry. Already, the usual suspects are declaring Geron’s departure from regenerative medicine the end of stem cell medicine.

An Associated Press story has it that Geron’s move has “stark implications” for development of stem cell therapies in the United States. Andrew Pollack of the New York Times says basically the same thing, “The move is expected to be widely seen as a setback for the field,” he writes, “because of Geron’s central role.” Geron’s “central role,” however, is primarily among incurious journalists.

If you believe, as I do, that Dr. Michael West and BioTime are the true innovators, then we will probably have a valuable opportunity to buy BioTime at artificially depressed levels. While I’m not encouraging “trading,” the opportunity exists to make significant short term gains when the conventional wisdom is so wildly wrong.

Regards,

Patrick Cox

Good Riddance to Geron was originally featured on Whiskey and Gunpowder. Visit Laissez Faire Books for the best selection of libertarian book titles.

His claim was that people will no longer buy actual books and everything will be downloaded onto e-readers. This is supposed to destroy the publishing industry and the insinuation is that the federal government should do something to stop this atrocity. I believe that this is another instance of a politician not staying awake in their economics class while they were in college.

In Chapter 7 of Henry Hazlitt’s book, Economics in One Lesson, titled the “Curse of Machinery”, Hazlitt gives examples how machinery has actually increased jobs not cause the unemployment plague many politicians claim. Hazlitt’s gives the example of Arkright’s invention of cotton spinning machinery in 1760. It was predicted the machinery would put English textile workers out of work. What really happened was that the textile industry grew exponentially over the next two and a half decades moving from 7,900 to 320,000 cotton spinners and weavers. From my and Hazilett’s calculations, that is an increase of 4,200% over the 27-year period. How is this possible you ask?

Technology helps reduce or even eliminate the barriers of entry for new businesses. Creating more competitive economies of scale and increasing competition. The increase in competition breeds efficiency and reduces prices for the end user. The solution isn’t the government pumping money into the paper industry or even the publishing industry. The government’s job is to let the free market alone and let it run its course.

If an industry is dying, there’s probably a good reason for it. So let it die. As Danny DeVito’s character, Larry the Liquidator, said in the 1991 film Other People’s Money, “I bet you there was a time where dozens of companies were making buggy whips and I bet the last company that was around was the one that made the best ***damn buggy whip you ever saw”.

The problem with Congressman Jackson’s view of the iPad and technology in general is that he is looking very narrowly at a very big picture. He only sees the displacement of book publishers and paper manufactures. The problem with the “old technology” of books is that it’s becoming obsolete. However, if publishers are moving from paper to electronic media, this will create new jobs. The need for graphic designers, web managers and web security people become crucial in the ever complex world of electronic publishing.

Congressman Jackson isn’t seeing that the production of iPads means the potential opportunity to create new jobs and sustain existing ones. Apple employs about 35,000 people. Many of those people work in Apple’s retail stores. There are many other companies that are in business to create the cool apps that the iPad offers. Not to mention that with such apps like the credit card processing app that allows businesses to be more mobile and reach and conduct business with their customers.

(If you have the opportunity, come the Agora Financial Investment Symposium and you will see Laissez Faire Books process your book purchases — yep you guessed it — with an iPad and a credit card app.)

One of the arguments is that we need to employee American manufacture workers in order to build what we create. My question is simple: Why?

Manufacturing labor is cheaper overseas and companies like Apple want to keep costs down. In order to keep the cost down they need to work oversees. Why not produce in the U.S. you ask. Well one reason is that labor unions have made it too expensive for businesses to do business in the U.S. for example the steel and automotive industry.

Unless, the automotive industry is from overseas that find right to work states like Tennessee and Kentucky. These states are benefiting from the Japanese car manufacturers setting up their non-union plants and employing a large amount of automobile workers. I wonder if Japanese say we need to bring our jobs back to Japan.

In the early 1990s Agora Publishing sent publications via print and the then cutting edge technology of facsimile (faxing). The company was about 40 people strong at that time.

In the mid-‘90s came the realization that the internet was going to have a huge and negative impact on the newsletter business if the new technology wasn’t embraced. Bill Bonner reached out to our customers and asked them what they thought about getting their newsletters via the internet. The response was resounding yes.

Now Agora and all her affiliates employee close to 1,000 people. That is a 2,500% increase over the last 15-years. A big reason for the increase is that we need web teams and information technology people to ensure that your e-letters get to you. Now that we don’t have to spend as much on print we can now employee additional editors that bring you more content more quickly.

Does technology make some jobs obsolete? The answer is an obvious yes. So let us have a moment of silence for the milkman, the cobbler, and the town crier but let us celebrate the grocer, the staff at Footlocker, and the talking heads like those on Fox News and MSNBC.

More often than not technology actually increases jobs. You want manufacturing jobs to come back to America, then talk to the unions and let them know that $70 an hour may be a bit high for someone to put tires on the new Camaros.

Regards,
Shawn Lyttle
for Whiskey & Gunpowder

P.S.: Oh yeah, one last thing. Before we start playing taps for the paper industry let us realize that in this writer’s opinion we will find the lost city of Atlantis before we move to a completely paperless society. I know first hand that there are many bibliomaniacs that still walk amongst us and that despite whatever cool e-reader you give them, it will still not replace that feel of a good book.

You want to check out some good books, then go to LFB.org.

April 20, 2011

The Economics of Technological Advances was originally featured on Whiskey and Gunpowder. Visit Laissez Faire Books for the best selection of libertarian book titles.

Pushing Buttons Like The Jetsons

In the classic and futuristic television series from 1962 to 1963 – I admit that I adore this show and could watch every episode 100 times – people work only a few hours a day, travel at 500 miles per hour in flying cars that go as fast as 2,500 miles per hour, and the main job is “pushing buttons.”

The galaxy is their home. Healthcare is a complete free market with extreme customer care. Technology was the best (but of course it still malfunctions, same as today). Business is rivalrous, prosperity is everywhere, and the state largely irrelevant except for the friendly policeman who shows up only every once in a while to check things out.

The whole scene – which anticipated so much of the technology we have today but, strangely, not email or texting – reflected the ethos of time: a love of progress and a vision of a future that stayed on course. Appropriately, it was the first show shown on ABC television in color instead of black and white. It was neither utopian nor dystopian. It was the best of life as we know it projected far into the future. People did not dress in uniforms or obey some dictator on a monitor in their homes. The people in the show were as fashion conscious as any American. Their food was not embedded in pill form. They had the equivalent of fast-food delivery services in their homes.

The message is a true one. Human nature and the structure of reality itself don’t change. Only the gizmos we use change. We can become poorer or we can become richer. But the fundamental facts of how the world is built are immutable. Things are scarce but the possibilities for economic creation are infinite in a world of trade, boundaries, law, and private innovation.

Why is it so fun to watch? Because it is a cartoon, because neat gadgets are everywhere, but mostly it amuses us because everyone seems so strangely blasé about all the miracles that surround them. They are living in postmodern houses that seem to be braced on some giant poll in the sky, and yet they think and act just like the rest of us who live on the ground. They aren’t surprised by anything, no matter how amazing.

And despite the extraordinary conveniences of life, the essential problems are the same, the human vices documented since the beginning of the written human language. The kids have the same trouble as our kids. “Daughter Judy” is spoiled and pouts too much; “his boy Elroy” gets into trouble; George tries in vain to solve all troubles but is mainly concerned about keeping his job; and “Jane his wife” keeps the home together.

The persistence of choice leads to complaints that there isn’t enough. “Pushing buttons” is the main thing everyone complains about. When they want to get away and relax, they usually choose some enterprise that offers the experience of a made-up world of the past that seems to take them back to the Old West (the “Beta Bar Ranch”) – but it is only pretend. We have the equivalent with our fantasies of “returning to nature” by shopping at grocery stores with philosophies, or believing that by not printing “this email” we are saving the planet.

In what other ways is our world like theirs? We too are surrounded by amazing miracles generated by private enterprise and entrepreneurship. Every day we wake up to some overnight development that makes our lives slightly better. The advances have come along so quickly that articles on technology written just a few years ago now strike us as old-fashioned.

Boy Elroy has a machine that can conjure up real-time worlds that allow him to play baseball and tennis with family members. We call that the Wii. The vacuum cleaners work without pushing them, and, sure enough, we have those, too. The video phone is the great dream that this show dreamed up. You had to pay. When you call long distance (does anyone remember that?) “collect” (does anyone remember that?), you had to accept or reject the charges. The video phone was strapped to the ceiling and couldn’t be moved, just like telephones were until the day before yesterday.

Peter Sidor, a heavy hitter at the Mises Wiki, recently called my Skype app on my iPhone, something I downloaded the other day just to test it out, and I answered and, voilà, I’m video talking to a colleague in Germany. I walked around with my phone. The app was free. Skype begs me to use the service. The iPhone 4 came with FaceTime built in, not that the appearance of this miracle created much chatter at all.

All this stuff is amazing. It is astounding and beyond belief – more outrageously advanced than anything the makers of The Jetsons could even imagine. With this tiny box in my hand, I can do a real-time video chat with anyone on the planet and pay nothing more than my usual service fee. This means that anyone on the planet can do business with and be friends with any other person on the globe. The borders, the limits, the barriers – they are all being blasted away.

The pace of change is mind-boggling. Email has only been mainstream for 15 years or so, and young people now regard it as a dated form of communication, used only for the most formal correspondence. Today young people use instant messaging through social media, but that’s only for now – and who knows what next year will bring.

Oddly, hardly anyone seems to care, and even fewer care about the institutional force that makes all this possible, which is the market economy. Instead, we just adjust to the new reality. We even hear of the grave problem of “miracle fatigue” – too much great stuff, too often. Truly, this new world seems to have arrived without much fanfare at all. And why? It has something to do with the nature of the human mind, which does not and will not change so long as we live in a world of scarcity. We adjust to amazing things and don’t think much about their source or the system that produces them.

The Jetsons’ world is our world: explosive technological advances, entrenched bourgeois culture, a culture of enterprise that is the very font of the good life. But there is one major difference, and it isn’t the flying car, which we might already have had were it not for the government promotion of roads and the central plan that manages transportation. It is this: we also live in the midst of a gigantic leviathan state that seeks to control every aspect of our life to its smallest detail.

The government is still Flintstones, an anachronism that operates as this massive drag on our lives. With its money manipulations, regulations, taxation, wars (on people, products, and services), prisons, and injustices, we similarly look the other way. We try to find the workaround and keep living like the Jetsons. Oftentimes things don’t go right, and the reason is the anachronism that rules us. And yet, unless we understand cause and effect in the way that the old liberal tradition explained it, we can miss the source.

Regards,

Jeffery Tucker
Whiskey & Gunpowder

Pushing Buttons in The Libertarian Utopia of The Jetsons was originally featured on Whiskey and Gunpowder. Visit Laissez Faire Books for the best selection of libertarian book titles.