From: "E. Allen Smith" <EALLENSMITH@ocelot.Rutgers.EDU>
Date: Sat, 9 Nov 1996 13:21:32 -0800 (PST)
To: cypherpunks@toad.com
Subject: RRE: notes (8 Nov 1996)
Message-ID: <01IBNCKT4KUOA73IB7@mbcl.rutgers.edu>
MIME-Version: 1.0
Content-Type: text/plain


	This has a rather chaotic mixture of inapplicable and useful
information; I'll try to edit out the non-useful stuff (via [...]). He's made
the distinct goof of misidentifying libertarianism with 60's style
anarchosocialism, as well as other problems... I'll be emailing him myself
with some comments.
	-Allen

From:	IN%"rre@weber.ucsd.edu"  9-NOV-1996 05:26:15.31
To:	IN%"rre@weber.ucsd.edu"
CC:	
Subj:	notes

Notes on network computers, blind copies, democratic culture, monopolies,
and the idea of an Internet establishment...


As a periodic reminder, a Web archive of nearly all the RRE messages ever
sent can be found through  http://communication.ucsd.edu/pagre/rre.html


It turns out that the article on cryptography by Bruce Schneier that I
forwarded from the Risks Digest the other day was actually an unfinished
draft that Peter Neumann sent out by mistake.  Bruce asks that everyone
refrain from propagating that version around the net.


Steve Lohr's article on the "network computer" in Monday's New York Times
includes the following priceless quotes:

  The line between these network computers being used as really effective
  corporate tools and being used as mind-control tiger cages is a fine
  one.  There will be a real temptation for corporate managers to go too
  far in the direction of control.
    -- Paul Saffo

  The paradise of shared knowledge and a more egalitarian working
  environment just isn't happening.  Knowledge isn't really shared because
  management doesn't want to lose authority.
    -- Shoshana Zuboff

  What's a floppy disk?  It's a way to steal company secrets.
    -- Scott McNealy

  We think we can go after the dumb-terminal market too.
    -- Bill Gates

I wish we could rewind this whole computer revolution thing and start over.


[...]


Non-Americans keep remarking on the predominance of American items on
RRE.  That's simply a function of the items that RRE subscribers send me.
If you come across interesting items from other countries, I hope you'll
consider sending them along.


[...]


A while back, I came across an op-ed column addressed to teen-agers which
purported to explain certain points about life.  The first of these points
was, and I quote,

  Life's not fair.  Get used to it.

All of the points were like this: each of them presupposed that their
reader held a putatively naive or self-serving opinion about life,
and they proposed to set the reader straight in a remarkably nasty and
disrespectful way.

I view this article as part of a larger and very depressing trend: the
return of authoritarian culture.  The purpose of authoritarian culture
is to instil a mindless obedience to authority.  It employs two basic
methods.  The first of these methods is stereotype: one's normal human
tendencies to think critically and oppression resist are caricatured
and ridiculed; endless stories are adduced to portray people who employ
these innate faculties in a bad light; and labels such as "whining" and
"complaining" and "victim" are liberally applied.

The second method of authoritarian culture is the attempt to naturalize
authority by hiding it behind large abstractions.  In this case, the
abstraction in question is "life".  Having established that "life" is
unfair, it becomes possible to label any protest against unfairness as
a demand that the whole world conform to one's own immature whims.  These
teenagers are counseled to "get used to it" and to reconcile themselves to
a life of being treated unfairly.  No liberal nostrums about self-esteem
here: this columnist's message was that nobody deserves to be treated with
respect, and that it's arrogant to think otherwise.

Another example of authoritarian culture is the contemporary American
use of the word "accountability".  Accountability, we are told, means
"accepting the consequences of your actions".  Everyone is supposed
to "be accountable", and to embrace this condition as a concomitant of
responsible adulthood.  Authority here is hidden through a grammatical
device.  In normal usage, the word "accountable" takes a complement,
as in "accountable to ...".  When the complement is omitted, the human
authority is displaced into the woodwork, and obedience to that authority
is conflated with a variety of quite different conditions: responsibility,
honesty, etc.  No reasonable person has a problem with the idea of being
responsible for one's actions.  But nobody who believes in a democratic
society can accept the idea that any person has absolute authority to
judge any other person's actions, and hand down "consequences", without
likewise being constrained by norms of responsibility, which in the old
days were called "justice" and -- yes, that's right -- "fairness".

It is not surprising when people in authority employ such language.  But
authoritarian culture requires more: it requires that people internalize
this language, applying it to themselves and dissociating all desire for
justice and fair treatment.  We all have our failings, but we we cannot
have a decent society unless everyone is treated with respect and judged
with a reasonable regard for proportionality and due process.  Healthy
people don't just "get used to" injustice.  Quite the contrary, genuine
maturity begins with the skill and discipline of helping people organize
to identify and overcome injustice.  Shame and ridicule are the least
violent of the tools that have historically been employed to condemn
people to passivity.  But they are also the most basic and, in the end,
the most destructive.

The basic method for promoting an extreme position is to harp on the evils
of the opposite extreme.  Authoritarian culture thus lives in a symbiotic
union with its evil twin, libertarian culture, whose sole value is freedom
from constraint.  The symbiosis between authoritarian and libertarian
culture has many facets:

 * Authoritarian culture holds that people are essentially bad and that
nothing can be done about this; libertarian culture holds that people
are essentially good and that nothing needs to be done to encourage this.

 * Authoritarian culture imposes constraint without respect for individual
dignity; libertarian culture holds that individual dignity consists in the
absence of constraint.

 * Authoritarian culture holds that people are innately irresponsible;
libertarian culture denounces responsibility as an authoritarian myth.

 * Authoritarian culture and libertarian culture both conflate feelings
with action, authoritarian culture to repress them both and libertarian
culture to license them both.  

 * Authoritarian culture crushes the spirit and eventually gives rise to
an immature impulse toward libertarian culture; libertarian culture stands
indifferent as great industries arise to support an epidemic of addiction,
which then gives rise to a fearful impulse toward authoritarian culture.

What authoritarian and libertarian have in common is their claim to follow
a simple, objective rule that lies beyond human interpretation: the rule
of order or the rule of freedom.  The terra incognita that lies beyond
the dysfunctionality of both authoritarian and libertarian culture is
democratic culture: the form of culture within which everyone takes
responsibility for living together constructively.  Democratic culture
is not just a matter of voting.  It is a set of values, and it is a
set of skills.  Some of these skills are organizational: you can't have
democratic culture unless people know, deep down in their bones, how to
hold a productive consensus-based meeting.  Other skills are emotional:
you can't have democratic culture unless people can tell the difference
between resisting oppression and acting out resentment, between organizing
and polarizing, between freedom and irresponsibility, between pleasure and
addiction, between discipline and shame, between personal boundaries and
passive aggression.

The sixties have left an ambiguous legacy because they blurred together
two very distinct impulses: countercultural libertarianism, for which I
don't have an awful lot of respect, and democratic experimentation, for
which I have a great deal of respect.  Recreational drug use, for example,
is stupid and boring.  But the democratic organizing traditions that arose
and flourished in the sixties were an important cultural contribution, and
it's sad to see them forgotten.  The rise of authoritarian culture depends
on this forgetting, and on crushing at an early age the hopes for human
dignity with which all of us are born.

Why isn't this obvious?  One reason is that the American conservative
movement originated as a marriage of convenience between authoritarians
and libertarians, both of whom portrayed themselves as opponents of
something called "government".  But opposition to government tout court
is opposition to democracy.  We have been inundated in recent years by
rhetoric that seeks to make democracy literally unthinkable by conflating
all types of government, whether democratic or totalitarian, into a
single stereotype of oppression.  This stereotype requires its proponents
to construct themselves as powerless victims, and it licenses all sorts
of whining and complaint by the very people who make a big point of
censuring whining and complaint by others.  By treating the institutions
of a democratic society as inherently beyond control, it also licenses
an abdication of personal responsibility -- the responsibility to learn,
practice, and teach the values and skills of a democratic society.


Back in the Later Middle Ages, around 1994, I often found myself lectured
by experts who asserted that great bureaucratic institutions, government
and corporate alike, would necessarily and inevitably disintegrate in the
world of the Internet.  It's almost 1997 now, and as the months go by I
find it ever harder to remember why this great disintegration was supposed
to take place.  If evidence counts for anything, we are actually living
in an unprecedented era of concentration and centralization.  ABC has now
become the Disney Infomercial Channel, and British Telecom is buying MCI.
And the more I learn about Internet economics, the more the Internet seems
like a veritable engine of monopoly-creation.  The reasons are numerous.
Most of them are explained in the recommendations and bibliographies that
I have provided in past issues of The Network Observer, and any one of
them would suffice:

 * The Internet backbone business, like any other utility, involves high
fixed costs and low marginal costs of serving additional customers, so
that bigness is highly rewarded.  And every provider has an incentive to
give priority to packets that remain within its network, thus giving a
quality-of-service advantage in the market to whichever provider first
establishes a dominant position in a given segment of the market for
network services.

 * The pattern of high fixed costs and low marginal costs is even stronger
for software: if two software products compete then the price of each is
determined by its development costs divided by the number of customers.
As a result, other things being equal, the company with the larger market
share completely destroys its competition.  If other things aren't equal,
a company with an existing flow of monopoly rents can simply give away its
products until its competitors' capital is depleted.

 * And then there are de facto standards: the dynamics of standards are
fantastically complicated, but the Internet still needs several additional
service layers, and even a single proprietary standard could give one
firm immense power to extract rents from Internet users and dictate future
directions for Internet architecture.  Since most of the forthcoming
standards will be implemented in software, the monopoly tendencies of the
software market will promote the rise of proprietary networking standards.
Past experience with the Internet is misleading: small players and ARPA
philosopher-kings can establish a new standard in the world if the big
players are asleep, but the big players are awake now.  In the future it
will take capital and speed to impose a standard, and winner takes all.

 * The economics of information -- "content" -- are no more reassuring.
Since information can be replicated cheaply, an overwhelming, life-or-
death incentive exists to leverage creative effort across as many channels
as possible.  Of course, every industry has an incentive to increase its
revenue.  But as the marginal cost of selling additional units approaches
zero, prices are directly determined by market share, thus giving rise to
a positive feedback loop and eventual monopoly.  This suggests that, to
the extent that the Internet is a vehicle for the delivery of information
commodities, it will necessarily be absorbed into the institutions of the
media system.  Nobody will be able to afford to produce a news service
that only operates on the Internet, for example, given that existing news
services can adapt their work to the Internet for much less than it costs
to produce a competing service from scratch.  And content providers who
already operate in other media will have a powerful incentive to adapt
their services to the Internet, provided only that additional money can
be made by providing those services in the Internet medium.

It is commonly argued that the Internet, by reducing transaction costs,
will cause organizations to break apart and industries to reorganize on a
more entrepreneurial basis.  I have argued this myself.  But the argument
doesn't work.  The Internet (and not only the Internet, but a world of
other technologies) reduces transaction costs and coordination costs
alike, making it less efficient to operate large organizations that cross
many disparate functions but more efficient to operate large organizations
that do one standardized thing.  Thus we have waves of both outsourcing
(due to decreased transaction costs) and concentration (due to decreased
coordination costs).  And high-tech industries increasingly favor those
firms that can see standards battles coming and prepare to fight them in
a coordinated way.

Other arguments against the monopoly scenarios have more force.  Internet
service provision is not yet a monopoly, and it is not obviously headed
in that direction right now.  Nobody understands the ISP business very
well, and it would appear that the smaller entrepreneurial firms have
an advantage in adaptability in an environment of rapid technological
and market change.  AT&T, moreover, would seem to be falling apart at
the seams in very much the fashion that Schumpeter, that patron saint
of entrepreneurs, would have predicted.  Even MCI has been hitting itself
on the head pretty hard during the last few years.  So my point is *not*
that the Internet is definitely going to be locked up by cigar-smoking
corporate titans.

My point is simply this.  It's almost 1997, and yet the airwaves and
magazine pages are still full of ideologues, still reciting old-wave
technological determinist mantras about how the Internet will inevitably
bring us a decentralized world of freedom.  Technological determinism,
however, is a kind of cargo cult: it asserts that we can obtain a happy
society if we simply work hard enough at idolizing the technology.  The
world doesn't work like that.  Significant forces are operating in several
directions, some of those directions are more pleasant to contemplate
than others, and the outcome is not preordained.  It seems to me that
the proponents of a totally unregulated economy should learn a little
more economics.  It also seems to me that it's time for a revival of
the democratic values that make it possible to imagine a conscious choice
about our technological future.


[...]


After my comment about the Journal of Internet Banking and Commerce
the other day, I got an irate message from the Journal's editor.  Among
his less extravagant suggestions was that I am a member of the Internet
establishment who has the power to destroy people with a word.  Gosh.
My first response was to wonder if Hallmark has a card for this occasion:

  To a childhood friend, after all these years

  I can still remember how, it seems
  You never picked me for your teams
  I have no idea now where you've went
  But I'm a member of the Internet establishment
  So you better watch out what you say
  Or with my keyboard I'll blow you away

Then I thought about it more seriously.  I'm not here to take shots at
struggling Internet publications, unless you count Slate.  My only goal
had been to plug the Scout Report, and the truth is that I was too lazy
to dig up an issue of TSR that I was 100% comfortable with.  I won't go
into the reasons for the opinion I formed of JIBC back in the spring,
since you can easily judge for yourselves.  Of course I should take
ordinary care not to slam people at random, and by trying to run this
list in odd moments of the day I'm all too likely to get careless.  The
harder question is, is this guy right?  Never mind that he had a grossly
exaggerated estimate of RRE's readership -- the idea that I am a member
of any kind of establishment is completely foreign to me.  Of course,
this could simply be a self-serving delusion.  After all, as a white
guy who was born in the United States, I enjoy numerous social privileges
that I have never earned.  And as a graduate student at MIT, my cohort and
I were located so close to the center of the post-WWII military-academic
complex that we had the resources to pretend that we were antiestablishment
nonconformists.  Still, if the Internet establishment exists and holds
councils, I have never been invited to them.  I have met some of the
publicly prominent Internet people once or twice and have found them to be
remarkably decent, but I hope you will agree that my message on RRE is not
particularly congruent with theirs.  Yes, I organized a CPSR conference a
few years back, but look what's happening to CPSR.

So, at the end of the day, am I basically just another guy with a mailing
list?  When I started RRE, I assumed that surely by now the Internet
would be crawling with filter lists such as my own.  But even though some
other excellent filter lists do exist, including some (David Farber's,
for example) with many more subscribers than my own, my assumption hasn't
come close to being true.  Why is this?  I can think of a few reasons:

 * Limited access to the tools.  The hardware keeps getting faster, but
   the software for maintaining mailing lists isn't much better than it
   was in 1993.  It's still impractical for 95%+ of Internet users to
   maintain large mailing lists.  This is a scandal.

 * Flexibility of the tools.  The assumption that lots of people would
   start filter lists depended on another, implicit assumption: that
   the Internet only supports a limited number of interesting mechanisms.
   Lots of people are doing great things on the Internet, and they have
   shaped tools to fit their particular visions, which simply differ
   from mine.  Even the other filter lists vary widely in their traffic,
   contents, respect for copyrights, and amplitude of editorial voice.

 * Network externalities.  As I mentioned the other day, it's possible
   that once a list like RRE establishes a large subscriber base, other
   lists will have a hard time getting enough traction to compete.  This
   is because the success of such lists depends in part on the number of
   subscribers they have, and I got the subscribers first.  On the other
   hand, 4300 is a small fraction of the total world of Internet users.

 * Critical mass.  RRE is mostly about the social and political aspects
   of networking and computing.  This is a fashionable topic, and it
   is a topic likely to appeal to a large proportion of Internet users.
   Someone who wanted to run a filter list devoted to medical issues,
   for example, would be limited by the number of Internet users in
   the medical field.  On the other hand, one major early source of RRE
   messages was Gleason Sackman's high-volume filter list on education.

I wish I could say that the Internet affords freedom of the press to those
who don't own one.  But it's not true, not yet.  So maybe, on some very
tiny scale, I'm an Internet analog of Rush Limbaugh or Scott Adams.  Those
guys could hardly be more different on one level, but they also reflect an
important convergence.  Rush didn't invent talk radio with its structured
listener involvement; the innovation of his show was that it's basically
about his opinions.  Dilbert didn't invent the comic strip; his innovation
was to use the Internet to involve his readers in thinking up the ideas.
In each case, the result is a voice that seems on the surface like a
synthesis of the star's voice with that of his audience, and the fear
is that this result is a sham, giving just enough of an appearance of
audience involvement to authenticate the star as the Voice of the People.

Likewise, by forever soliciting subscribers' submissions while exercising
absolute editorial control, I can imagine that this list conveys a sense
of omniscience that has little basis in reality.  As a recovering know-it-
all, I can testify how addictive this position can be.  I can imagine how
this list can be perceived as more authoritative than it really is.  And
since perceptions of authority are largely self-fulfilling, I can appreciate
how an RRE message can do more damage than it has any right to.  I don't
really know for sure, nor is it mine to judge.  But I suppose I should err
on the safe side.