Between the Squirrel and the Ant

From many years ago, a long time before the word term “welfare state” was conjured, society (if we can ask its non-believers to suppose its existence) must have been quite a tenuous concept. Our distant relations in the animal kingdom lead quite different lives and communities. Most don’t look out for each other and it’s this lack of collaboration that means they’re not us. We live on a spectrum, positioned somewhere between a dray of squirrels and an army of ants. Democracy has accelerated nation states into looking out for its weakest and most vulnerable. Over centuries, we have shown we have become more compassionate, even though short term electoral cycles may disguise this very strong longer term trend. However it is important to recognise that these changes have been accompanied by a massive improvement in prosperity and living standards.

The tax rate once upon a time was zero. Then powerful Kings and Queens sought tax for wealth and power and to build armies to stop foreign armies invading (or to invade somewhere else). Now the representation we accept in exchange for taxation is divided left to right.

We do know zero taxation would lead to a barren lawless land and we know that 100% taxation would lead to a seizing up of effective production and our functioning. The question for every democracy and dictatorship is how much to turn the taxation dial.

Perhaps the dominating sovereign debt headlines are no different to any other debt issue. Money, representing work done, has been borrowed by those that already have money (for work done) and lent it to those who borrow. Be it entrepreneur, gambler, business or state, the borrower must generate a return in order to repay the creditor. It therefore seems that some governments have not been able to generate the return from their society that was required. If we do find that nations collapse under their own debt then this should be recognized as a warning signal that our capital has been misallocated and our ideals have overburdened our pockets to tearing point. This very alarm is a signal that we need society to generate a better return on the tax paid by and to the nation.

Collaboration has changed from one of sharing meat and fruit to sharing stored capital in money. We could also suggest that money needed to be created once society reached a certain level of productivity – otherwise why work? One may expect that short term volatility would over the fullness of time exhibit a trend of convergence to some magic and universally accepted level of taxation. However it’s very difficult to know if our society is more collaborative today compared to 10,000 years ago. Certainly we have always built upon inter-generational advancements (very possibly the defining element of being human). However answering if our predisposition (or need) to collaborate has changed over the last 10,000 years makes me want to go for a long walk in the countryside.

Honey, what have you made today?

Why is it we say we have “made” money from a good investment or we have “lost” money from a bad one? Shouldn’t we be consistent and symmetrical and say we have “broken” or “destroyed” money if things turn bad or say we have “found” money when things go well? How dare I call this hubris. We’ve chosen these words over a long time. It’s what we have found we like saying and we say what we like.

Don’t be Sauron

A long time before George Orwell was even born or Tolkien imagined the Eye of Sauron, in 1791 the British philosopher Jeremy Bentham proudly laid out his blue print for the ‘panopticon’. The panopticon was a concept prison building in which the occupants were constantly observable. Bentham was careful to define the concept as one in which the inmates were observable rather than necessarily observed. The building was planned as a circular ring around a centrally positioned watchtower. By including partitions (that were like incomplete wheel spokes) from the outer ring, a set of cells along the outer perimeter could be constructed so that the central watch tower could see into each and every cell right through to the perimeter wall at the back. No cell could see its adjacent cell. Bentham envisioned that any watchmen within the central tower would be hidden from view of the prisoners, thus introducing the uncertainty within the prisoners of their being watched. Bentham conceived that living in this permanent state of observed living would pacify the prisoners as well as leveraging resources to maximize efficiency.

We are now well into the informational epoch that ignited with Intel’s first micro-chip. We began with the original IBM main-frame concept and after spending twenty years with decentralized personal computation memory and processing power, we are now returning to the original model of centralized computing. Perhaps our detour away from centralized computing will provide important lessons for the continuation of our march along our inevitable technological path. However now we are migrating data and computing power towards cloud computing. This model which has all the wires leading to a central memory and processing unit offers an awesome potential.

This week, the Executive Chairman of Google, Eric Schmidt, explained that Google+ was built primarily as an ‘identity service’. A debate has raged: One side claims that a transparent web of true identity is a good development that will bring honesty and decency. The other side claims that our privacy is a right and this outweighs the cost of its abuse. Of course Google are a private company and have the right to do as they wish.

The famous ‘Milgram Experiment’ (Yale 1961) and the (Zimbardo) ‘Stanford Prison Experiment’ (1971) do demonstrate the dangers of an imbalance of real, or at least, perceived power.  With increased information, leveraged for the good of our diet, it is important that we know if the central Eye of Schmidt’s comment ‘might blink’. After all we need to know what we are leveraging. We as a society have the right and currently the privilege of giving and restricting power, but for this to remain so we need to know the extent of any powers.

Bentham may well have argued that the mere possibility of being observed online would act to moderate our behavior. The application of observance by means of the penopticon prison did of course apply to criminals and not ordinary citizens. We should at least recognise that we may be led by stealth into an infrastructure looking very much like a cyber penopticon.