Data and Democracy

The 9/11 attacks confirmed what many of America’s critics suspected. They were a sign of decline. With the economy contracting, and no clear adversary in sight following the fall of the USSR, Washington was at a loss to define itself as the impregnable power everyone once feared. Indeed, there was something unprecedented about it all. Particularly for Americans, with little sense of what life was like outside the glory days of the post-war era, and their country’s move to the world’s center stage during the fight against Hitler.

Truth be told, there were plenty of precedents to compare it to. Since the 1950s, first world superpowers had been on the decline. One-time empire builders like France and the United Kingdom had lost most of their colonies, and a great deal of their financial clout. Today, Paris and London are shadows of their former selves. Relative newcomer the United States was the last to join this club, in the 1990s, though to most, it took the onset of the War on Terror for Americans to lose their doubts.

Once dubbed, disparagingly, “Third World,” signature BRIC countries like China and India have ambitions to transcend their status as the West’s workbenches. They want to do more than just serve as cheap manufacturing resources, and they are catching up at a rapid pace. With 7 million new university graduates each year in China alone, it will be hard to compete against such an educated workforce. Western engineers, researchers and other academics will soon be outnumbered. The consequences are obvious.

Military power alone has long since ceased being a guarantee of global hegemony. Things have changed a lot since Napoleon Bonaparte, let alone the Cold War. Conquering and raiding foreign countries is nowadays a more and more difficult business. It’s only possible if there is at least some vague rationale of self-defense to justify military intervention. This limitation reduces the practical relevance of using the military to underwrite superpower status. Washington is the world’s leading expert on the subject.

Since the 1970s, the US has moved from being one of the wealthiest nations in the world to being one of its biggest debtors. This has had a corrosive effect on the relevance of its currency, and the role it serves in underwriting American power. Today, most dollars are outside of the US. This alone reduces the direct influence of the United States on its own currency. Furthermore, the American financial system relies on Fiat money which interest rates enforce exponential growth on the economy. Since the 1950s, many economists predicted that such growth will at some point reach its natural limit. So far, nobody seems to have found a way around it.

Data: The New Natural Resource

The American example is disheartening. Having similarly failed to win the War on Terror, everything it has tried to satisfy the old criteria to maintain its superpower status has backfired. The last remaining option for Western powers is to change the rules of the game. Revelations about American and British data gathering programs such as the notorious PRISM, and its equally powerful sibling, Tempora, suggest that they’re finally on to something. It’s all about the ability to collect data, and to analyze it.

They took their cue from the private sector. Within the space of half a dozen years, Google became the most influential company in the world – mainly because it understood how to collect and process huge amounts of data. There are many companies that seem to follow a similar strategy. Facebook and Twitter immediately come to mind, but let’s not forget Apple and Microsoft, with their cloud service offerings. Every one of these companies has built huge data centers, and make money by storing and processing their customers’ data. They function like alchemists. They turn data into money.

Repurposing such activity for military purposes isn’t rocket science. The model is itself riddled with authoritarian motifs – studying human behavior, tracking individual users, spinning partly made up stories to influence politics, as well as the fate of brands, industrial espionage, etc.

Exclusive ownership of valuable data is empowering. Data has a relevance not unlike natural resources. It may not be natural, per se, but as a commodity, it functions that way. The oil analogy comes to mind. Those who control it and can process it meaningfully will have enormous influence and clout.

The post-democratic era will be controlled by data. Countries won’t have to send soldiers into foreign countries anymore. Data miners will work from the comfort of their homes and will be more effective than drone operators. Or miners, or bankers, even. Data will cover all the bases. A data miner can destroy politicians in the highest of public offices simply by leaking unknown information about them.

For states anxious about reasserting their power, it’s an ideal scenario. Since large amounts of the world’s most valuable data is stored in the United States and Europe, the West stands the most to benefit from this situation. Hence the fact that the current surveillance crisis is taking place there, largely, rather than in more traditionally authoritarian police states, who also indulge similar surveillance practices, such as China, and the former Soviet Union.

The Money Will Flow Where the Data Is

The more an entity knows, the greater its worth. Facebook, for example is a very valuable company. It’s unique, insofar it is not prized for its actual revenue, but the data it collects from users. It is valued solely on the assumed future worth of the data Facebook will have collected from them, to be specific. This is an example of how money has started to flow to where the data is. Bitcoin is another example how data can replace money.

Data is becoming a fundamental evaluation criteria for economic value. The money will simply follow it. As data gets more relevant, the money will flow to the countries with the most valuable data. Given that the financial yield is not immediate, there is clearly a speculative element involved, which could and will eventually backfire. However, in terms of short-term gain, this new model has everyone’s buy-in.

What Does This Mean Politically?

If data becomes the new world currency, money will become of secondary interest. It won’t disappear – it will just become embedded in this new commodity form. In the future, class conflict will not be as explicitly manifest along left-right, poor versus rich sort of lines. Everything will be submerged. The world will be divided up between data-haves and data-have nots. The lucky ones – those with data – will have the food, the cars and the girls, etc.. IE, the money.

The financial crisis changed a lot when it comes to political and legal priorities. It seems like Barack Obama wants to grow the USA to be a data-driven superpower. He knows that America’s traditional world dominance is on the decline. To solve this problem, the President trades in constitutionally guaranteed rights to privacy, in the United States, as well as abroad, in exchange for continued American power. To achieve this, he is even willing to sacrifice, to some degree, the freedom of the US press.

PRISM is not so much driven by ideology or terrorism. It’s the joint strategy of the Western world to get out of the financial crisis by changing the traditional rules of the world wide economic game. PRISM seems to have the most efficient, powerful data collection and processing tools ever available. It can be assumed that it’s here to stay, and that there is no chance of ever getting it switched off.

An Opportunity for Change

Instead of thinking about how we could equally distribute wealth, it will become a much more important question as to how we can redistribute data equally. In Marx’s times, it was work and the worker. In the future it will be data access and the data miner. Data will replace capital as the primary power mechanism. Therefore, we have to design the rules for data carefully. Again, that doesn’t mean money has disappeared. It’s just assumed a more abstract form, one that reflects the quantification of everything. Hence data.

PRISM can’t be stopped. The technology is available and will therefore be used, if not by the Americans, than the British, or whomever. Right now, only a very small elite of people have access to PRISM, which gives its users an enormous amount of power. This is risky for all of us, as we cannot know whether we can entrust such an enormous amount of responsibility to anonymous people within the secret services. We need to change this.

Internationally-binding legislation should be made to make publicly accessible all data collected by the state. If required, we could all become data miners. That way everybody would be their own superpower. It would be impossible to beat us.

Democracy would get a chance again, as everyone would have the potential to access to the same level of information as anybody else – a very crucial and mostly neglected detail when it comes to real democratic processes instead of the simulations of democracy we see taking place in so many countries worldwide.

Instead of distributing capital evenly, we’d focus on distributing data access and analysis evenly.

The world of data is new, and the rules for this new world are not yet settled. This is a huge opportunity for substantial change. Let’s not miss it.

Photographs courtesy of Joel Schalit