In an article about the Chinese government's massive firewall to restrict social media in China, the following statistic was reported: there are 1.4 billion Chinese, and 632 million of them are online.
I would not place too much credence in the specificity of these figures, but the general estimates are probably correct. Something in the range of half of all the people in China now have access to the Internet. Over the next 10 years, this is likely to increase to at least three-quarters.
The Internet is the most powerful communications tool in the history of mankind. It is spreading at such a pace, and with such magnitude in terms of its audience, that we have never seen anything like this in the history of man. Gutenberg's development of moving type was nothing compared to what is happening with the Internet. Neither was radio. Neither was television. The Internet is extending its tentacles into the lives of almost everybody on earth. Almost everybody will soon have essentially equal access to the information that is contained on the Internet.
There is no possibility that the Chinese oligarchs are going to be able to protect themselves against the corrosive effects of information that is attainable at close to zero monetary cost. They can put up all the firewalls they want. There are kids out there who are skilled at defeating every attempt of the Chinese government to block out sections of the Internet from them. These young men are highly motivated. Their self-interest is at stake, and their self-image is also at stake. They want to gain a reputation within their inside group of hackers that they can beat the system. There is no question that they can beat the system. The only question is this: what percentage of the population is going to beat the system with them?
The Chinese system of economics is essentially Keynesianism. It involves central bank funding, and it involves state banks funding various enterprises. There is so much money in the hands of the planners, and so many opportunities to make money, that there is no way that this is not going to transform Chinese society. We already know this. We have never seen this rate of economic change inside the boundaries of a large nation. (South Korea, 1950-90, was faster, but it was smaller.)
The oligarchs at the top of the Chinese pyramid of power issue statements that reinforce the government's official view of the necessity for controlling access to information on the Internet. But the press releases in no way change the facts. I am reminded of the RIAA's press releases on the organization's success in limiting the spread of unpaid exchanges of copyrighted music. This is whistling past the graveyard. The magnitude of free music exchanges has buried the old models that have been used by the record industry to control access to music, and to take the lion's share of the income. A best-selling album today is about 150,000. Prior to the Internet, it was probably in the range of two million.
Press releases may impress the bureaucrats who pay bureaucrats to write them, but these documents have very little to do with reality. There is no way that the Chinese government can create firewalls that will not be penetrated by something in the range of 20% of those who have access to the Internet. We're talking something in the range of 100 million people to 200 million people. This number is going to increase as access to the Internet increases.
The literate, technically savvy segment of the population, which is where the future lies in every nation, is going to be able to break through the firewalls. These are the best and the brightest in the society, and they are going to beat the system. The aging oligarchs at the top of the political pyramid can hire salaried programmers who belatedly respond to cracks in the firewall. This is not going to save the oligarchs from the spread of unapproved information inside China.
DEFENSE WILL NOT WORK
We are coming into a period in which civil government is clearly on the defensive. There is no way that any civil government can maintain the illusion of legitimacy in the face of widespread criticism of obvious inconsistencies within the government. Legitimacy is at risk, and legitimacy is the foundation of all government.
The Chinese government is attempting to build a dike to prevent sequential tidal waves of unauthorized information from crashing through the political barrier that the government has built up over the decades. It is simply an impossible task. The more that the government attempts to restrict access to the Internet, the more that the forbidden fruit of access will lure bright young men into the cracks in the firewall.
This is going to undermine Keynesianism. It is going to undermine the massive central governments and their central banks. As the power of central government recedes in the face of low-cost information that is detrimental to the legitimacy of the state, the ability of the central planners to mobilize resources through taxation, regulation, and central bank inflation is going to fade.
The Internet is like a wedge. It is going to break apart the foundation of legitimacy which is essential to the maintenance of centralized political power.
It will not take longer than about one generation for this to be a universal phenomenon. Thirty years or 40 years from now, the massive centralized states that are dominant today will be a memory. There will be other problems that confront us, but the universal power of the bureaucrats is not going to be one of them. Their power is going to be shattered by decentralized information that can be accessed at almost zero monetary cost. Remember the rule: "when the price declines, more is demanded."
We are living in a transition period. Of course, every generation says this. But the speed of the transition and the magnitude of the transition, which are both based on Moore's law, are historically unprecedented. The existing political, social, and economic structures of the modern nation-state are under constant assault, and the assault comes across borders by means of digits. There is no way to successfully defend against this assault.
The problem is this: the institutions that have served as social support for the modern nation-state are at risk. They have bet the farm on the legitimacy of the modern nation-state, and yet there is no way to preserve that legitimacy from the corrosive effects of decentralized information that can be obtained at almost zero price. Think of the public school system. Think of the media. Think of most churches. They have all been dependent upon the spread of the welfare state, and they are all vulnerable to the bankruptcy of the welfare state.
CONCLUSION
This is why it is such an important aspect of education to challenge the legitimacy of this widespread extension of state power. We have to begin to train the next generation to recognize that this expansion was never legitimate, and should never have been supported. There has to be a rethinking of the moral foundations of the culture with respect to the expansion of the welfare state. The next generation needs to be convinced that there are institutional alternatives to the welfare state, and these alternatives are legitimate. Not many people are involved in preaching this message of deliverance. This is why every little voice counts.
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