Technocracy

For those of JC’s generation — we came of age in the Eighties, and are running sniper’s alley now — our radical departure with the gammon and boomers of the past was the rejection of centralisation. Ever the practical ones, we latchkey kids took our parents’ general suspicion of the Man and formalised it. Our movement’s leaders were not themselves of Generation X, but they spoke to us. They grokked our aspirational, optimistic, hopeful ethic.

The Devil’s Advocate™ →This page on the premium JC Gimme a TEAC C-90 CrO2 mixtape and I’m good to go. In which the curmudgeonly old sod puts the world to rights. Index — Click ᐅ to expand: The Devil’s Advocate Tell me more Sign up for our newsletter — or just get in touch: for ½ a weekly 🍺 you get to consult JC. Ask about it here.

Ronald Reagan captured our vibe:

Government is not the solution to the problem: government is the problem.

And the Walkman symbolised it: Individualistic, technophilic, selfish.

The ideological war was won. Call it what you will: Reaganomics, Rogernomics, Thatcherism, Perestroika, laissez-faire, deregulation, monetarism, around the world, the Man got out of the people's hair and left everything to the market.

Sure there were losers, as there are in any radical rearrangement of the social order, but it wasn’t us. We were on the right side of history, which had finished anyway.

Laissez faire, the basic gist: bottom-up beats top-down.

In a free society individuals are best placed and best incentivised to make their own decisions. Abrogate that principle only where those criteria do not apply.

Those criteria:

Formal: there is better information at the edges of the network than in the middle. Centralised machinery is slow, lossy and costly: informed decisions are best made at the point of sale.

Substantive: those are the edge of the network have the most skin in the game. It is their life, their school, their community. They have strong incentives to make good and efficient decisions because they will be most directly disadvantaged if they don’t.

As it always does, to the revolting masses the conversation seemed over. The riddle of sociopolitics was solved. As it always does, History had other ideas. It was not quite dead. Now we are the boomers, our kids sing a different song. (Enjoy it, kids: the next generation is on your tail.) The laissez-faire ideal has been lost.

But the shift away from laissez-faire was not a theoretical rejection of its central substantive ideal. There was no new Trotsky, stirring up foment and encouraging the kids to bend to collective government. Quite the opposite: the overpowering ideas of the 1990s and 2000s were if anything more extreme and more anarchic: the internet could set us free. But that very same liberating technology of the network nullified the formal objection to centralised management. No longer was it slow, lossy and costly to centralise. The network was free, bandwidth was unlimited and communication happened literally at lightspeed. Lossless centralisation was now possible, and if offered massive economies of scale.

Technological change facilitated central control. No one broached the substantive question of whether we should centralise.

We could, so we did.

But, call to mind JC’s Malmsteen paradox:

Just because advances in guitar technology mean you can play 64^th note flattened Mixolydian arpeggios at 200 beats per minute, this doesn’t mean you should.

Development in network technology — packet switching, routing, the end-to-end principle, substrate neutrality of data, and latterly machine learning, large language models and so on — made the information transmission needed for centralised decision-making feasible: infinite fidelity, infinite speed, minimal cost.

This did not address substantive concerns that laissez-faire addressed: that the person on the ground was best placed to make difficult decisions whose outcome disproportionately affected her over anyone else, but that was increasingly assumed away: major moral and social questions had finally been resolved — liberal democracy had won! — meaning there weren’t any moral decisions to be made. There were only practical decisions, but these were in principle soluble by calculation.

The fashion became not discussing technology in human terms as much as evaluating humans against technology benchmarks and finding the meatware wanting: humans were, it transpired, irrational, illogical, inconstant, prone to bias, and they took up space, needed holidays and cost a lot of money.

In the name of efficiency, everything could be managed by algorithm was assigned to computers, and so it came to pass we were progressively relieved of the inconvenience of making our own decisions.

The current backlash against this system is different from the 1980s free-market movement. Rather than being led by academics with theoretical arguments about economic efficiency, it's more populist and focused on concrete personal freedoms, especially free speech. This backlash is gaining momentum as people recognize how much individual autonomy has been eroded by technocratic control.

The movement has allied figures like Trump and Musk, but their actual commitment to consistent freedom-maximizing principles remains uncertain.

Crypto technocracy

The crypto-libertarian take: crypto promises to fix the technocratic problem of regulation by substituting it with code. Code is law.

But the problem of regulation is not technological but human. Indeed mistaking it for a technological problem is what got us here in the first place. Libertarians, of all people, should understand regulations not as abstract technical artefacts that create bad incentives — though, sure, they do this — but as a by-product of hard-wired human, self-interested behaviour.

Regulations make and get made by inevitable, self-interested human behaviour: acquiring social influence (and therefore political power); establishing market dominance and then extracting rent. The behaviour is reflexive, and there are feedback loops here. The regulatory ecosystem is as organic a market and complex a system as the market itself. It is part of the market.

Crypto does not — cannot — stop or fix hard-wired human behaviour. This is the the JC’s main objection to crypto maximalism: it is so glib. God knows the current state of trad-fi isn’t optimal, but it got that way because these are hard, deep, ancient, shape-shifting problems of human social organisation. They cannot just magically solved by code.