Exorbitant Data > Exorbitant Privilege

[lakedaemonian]

This article on WeChat is worth reading:


https://www.nytimes.com/2019/01/09/t...na-wechat.html


It offers a glimpse into the fundamental differences between individual Western social platforms and the all encompassing single app WeChat in China with over 1 billion monthly active users.


It’s like Facebook, WhatsApp, banking/credit/payments, 3rd Party services, etc. It arguably earns the title “Super App”.


Trade has been used as a weapon.

Reserve currencies(such as the US Dollar and previously the Pound) have been used for National/sovereign competitive advantage.


It’s not outside the realm of possibility that the WeChat platform could be used as a weapon to expand a Chinese dominant economic block by compelling its use with trading partners via leverage.


What if increasing Chinese debt trap diplomacy compelled the use of WeChat within its trading partners?

Are we possibly looking the wrong way on reserve currencies and commodity backed currency baskets?

Should we be giving increasing weight to platforms/networks?


Is there a possibility that the US Dollar global reserve currency is superseded by the WeChat global default platform?

Or some other platform/network analog.

Does exorbitant privilege become exorbitant data?

[jk]

Re: Exorbitant Data > Exorbitant Privilege

all the articles i've read recently re obor point to increasing suspicion and resistance after the experience of sri lanka. perhaps my sources are skewed, though, so i'm not sure how well obor is proceeding. it's also hard for me to imagine how "compelling" the use of wechat would work. every country would have to build a great firewall to match china's- but perhaps that's the point.

care to spell out how you imagine the platform being used in obor. and do you imply that the wechat implementation would also force all the participating countries to do their transactions in yuan only? i.e. that the yuan wouldn't become just a reserve currency, but would in fact become THE currency of all obor participants?

[dcarrigg]

Re: Exorbitant Data > Exorbitant Privilege

This article on WeChat is worth reading:


https://www.nytimes.com/2019/01/09/t...na-wechat.html


It offers a glimpse into the fundamental differences between individual Western social platforms and the all encompassing single app WeChat in China with over 1 billion monthly active users.


It’s like Facebook, WhatsApp, banking/credit/payments, 3rd Party services, etc. It arguably earns the title “Super App”.


Trade has been used as a weapon.

Reserve currencies(such as the US Dollar and previously the Pound) have been used for National/sovereign competitive advantage.


It’s not outside the realm of possibility that the WeChat platform could be used as a weapon to expand a Chinese dominant economic block by compelling its use with trading partners via leverage.


What if increasing Chinese debt trap diplomacy compelled the use of WeChat within its trading partners?

Are we possibly looking the wrong way on reserve currencies and commodity backed currency baskets?

Should we be giving increasing weight to platforms/networks?


Is there a possibility that the US Dollar global reserve currency is superseded by the WeChat global default platform?

Or some other platform/network analog.

Does exorbitant privilege become exorbitant data?

These are all interesting questions.

Part of me wonders how much difference there is between WeChat and Google though. For the most popular mobile setup in the US, Google Android is your operating system, Google Chrome is your browser, Google Search is your standard search, Google Contacts runs your contacts, Google SMS runs your text, Google Voice listens to, records, transcribes, and analyzes your voicemail and calls, Google Maps is tracks your physical location (in concert with Project Beacon et all), Google Wallet becomes your payment method, Google Plus is still there for social media, if somewhat unused, Google Hangouts (aka GChat, or Google Talk) are still used commonly in the US. I mean, the Google Suite does everything and tracks everything and remembers payment methods and does everything I can think that WeChat does.

In much the same way, Experian and company increasingly are becoming the equivalent of a social credit system. You need a credit check to get a job or get an apartment now. If you have shit credit, you may as well be blackballed, because you're probably going to end up squatting somewhere and working under the table since you can't participate in the above-ground economy anymore. I mean, try getting an apartment--any apartment--in NYC with a credit score of 649. It's damned near impossible. I've had friends even with 800+ credit scores who get rejected because they have too high an unsecured credit limit (which gives you the high score), and the brokers/landlords thought that meant they were too great a risk. An ever-increasing share of jobs do this too, mostly lower-end jobs. But it's up to 30% or so of private sector employment. A majority of private sector jobs in the US also require mandatory drug tests, often at the employee's expense, and often even in states where the drug is legal. Landlords are increasingly demanding drug tests of tenants as part of the application process at least, if not random drug tests over the course of the lease. Not sure the dystopian aspects of this kind of thing are practically much worse in one place than the other.

But here's the thing--what sent me off on this little rant in the first place: In some ways all this stuff makes cash more vital, not less. If you're some working-class shlub who pissses the Communist Party off in China or some working class shlub with a 640 credit score who likes to smoke weed in the US, you're barred from major chunks of the housing or employment markets, etc. And the tighter they grip, the more people just aren't going to be able to hack it and are going to squeeze through the cracks and need to arrange deals that aren't on the books. Illegal cash sublets. Off-the-books employment. Temp work. Drug dealing. Type of stuff where if it's done in cash without a trail it's much safer. Something similar happens on the high-wealth end of the spectrum too. They always need to launder money. The money itself becomes a reserve when it seems like it's a safe medium in which to park capital. The WeChat example is interesting. But I think more and more it's why you'll see Russia (glonass), China (beidou), the US (gps), and soon the EU (galileo) each have their own GPS-style systems. I suspect they'll each get their own WeChat / Google too. Russia has Yandex and VK. China has WeChat and others. EU just hit google with a $5 billion antitrust suit and it's possible competition will arise there. I think it's increasingly becoming obviously an issue of national security to have these systems set up, because they're not just surveilling everyone all the time, they're also useful for nudging behavior and shaping public debate and setting the agenda. So I can totally see your question as to weaponizing these types of things. I think we're already well down that road. Still, in some other ways, there's still going to be a platform under the platform. The ACH network is still growing. It did something like $50 trillion dollars in 20 billion transactions over the last decade. And P2P transactions (not B2B or Payroll) were by far the fastest growing segment. Venmo in the states has grown very fast. And it's using ACH as its underlying architecture. World Bank used to do a global payment systems survey. They had like 100 or so last time I looked. Wonder if that would provide any insight.

[jk]

Re: Exorbitant Data > Exorbitant Privilege

dc, i think you point to where blockchain is going, and why gov'ts want cash to disappear. bitcoin et al are going nowhere. blockchain will be implemented in e-currencies by gov'ts as a means of tracking all financial transactions. i think sweden iirc has gone pretty far down the no-cash road, but had to pull back a bit because of problems of implementation in rural, low-population density areas

[dcarrigg]

Re: Exorbitant Data > Exorbitant Privilege

dc, i think you point to where blockchain is going, and why gov'ts want cash to disappear. bitcoin et al are going nowhere. blockchain will be implemented in e-currencies by gov'ts as a means of tracking all financial transactions. i think sweden iirc has gone pretty far down the no-cash road, but had to pull back a bit because of problems of implementation in rural, low-population density areas

Maybe. Blockchain is incredibly clunky, heavy, and slow compared to other competing systems. The trade-off in my mind was supposed decentralization and anonymity. It has become clearer that bitcoin itself is not the best implementation of blockchain for decentralization or anonymity, I think. But the question I have is: If you were Treasury/Fed, why prefer crypto over ACH when you control ACH? More than that, why would a bunch of existing and powerful interests from banks to credit card companies want that? They might want to augment stuff with crypto. But the idea they'd want to upend existing systems still seems far off to me. Zelle and Venmo have something like 80 million US users each. There's like 5 million total bitcoin users worldwide. Crypto 10 years later is still quite cumbersome & difficult to use. These new direct to ACH apps can handle everything more easily, especially if you've got a regular phone and credit card number. Plus the transactions are not only tracked, they're public. http://www.vicemo.com. I'm not saying there's no role for blockchain. I just don't see it taking over the world in quite that kind of way. I think this is another scenario where there's probably 2 separate niches. Lots of things are sold as being the 'new x.' But it turns out they're just new and they're filling a bit of a different niche than 'x.'

[lakedaemonian]

Re: Exorbitant Data > Exorbitant Privilege

all the articles i've read recently re obor point to increasing suspicion and resistance after the experience of sri lanka. perhaps my sources are skewed, though, so i'm not sure how well obor is proceeding. it's also hard for me to imagine how "compelling" the use of wechat would work. every country would have to build a great firewall to match china's- but perhaps that's the point.

care to spell out how you imagine the platform being used in obor. and do you imply that the wechat implementation would also force all the participating countries to do their transactions in yuan only? i.e. that the yuan wouldn't become just a reserve currency, but would in fact become THE currency of all obor participants?

I believe (One Belt One Road)OBOR will continue virtually unimpeded for the following reasons:

1)US retrenchment into Fortress America combined with declining social and financial capacity(and national WILL) to fund a long term strategic diplomatic effort.

2)EU distractions of BREXIT and increasing political fractures

3)Russia lacks the financial capacity to realistically compete

4)India may be able to compete in the future as it's GDP expands, but weighed against internal development.

I see that leaving China to execute debt/trade deals to shape global users onto the WeChat platform.

One Platform, One Network(OPON).

I don't see it as a single global platform/network default standard

But I definitely see it as one of several global platforms/networks of globally strategic importance.

Despite artificial barriers such as Great Firewall and aligned western opposition to Huawei, ultimately Metcalfe's Law and Zipf's Law will come into effect in a global battle between competing platforms.

My initial thoughts are:

We see growing geopolitical friction between competing "superplatforms" and their superpower sponsors

We see increasing recognition that it's not just the means of exchange that matters, but the platform on which the exchange occurs as well as the network participants using it.

We see developing world "land grabs" for increasing platform/network "lock in".

We see increasing political/regulatory friction between nations when trans-national and global superplatform potential is recognised.

We see WeChat's superplatform better positioned for strategic advantage due to:

1)Single 100% integrated platform/network

2)Government integration

3)Mobile DNA

The incumbent Western superplatform is a FAANG patchwork in comparison and at frequent odds against government.

So in comparison, the western superplatform is neither operationally nor politically integrated to maximise geopolitical influence and utility.

When you look at future focused efforts such as Estonian e-residency, it's not a stretch of the imagination to see digital residency features and benefits only available to users of full integrated superplatforms becoming a natural progression.

WeChat platform lock-in within China is nearly universal and increasingly difficult to exist without.

With 100-200 million users outside of China, the expansion of a fully integrated superplatform has very real potential and represents a considerable threat to the status quo.

The Cold War was a battle between ideologies.

I believe this Cold War Redux will be a battle between platforms.

Just my 0.02c

Thoughts?

[lakedaemonian]

Re: Exorbitant Data > Exorbitant Privilege

These are all interesting questions.

Part of me wonders how much difference there is between WeChat and Google though. For the most popular mobile setup in the US, Google Android is your operating system, Google Chrome is your browser, Google Search is your standard search, Google Contacts runs your contacts, Google SMS runs your text, Google Voice listens to, records, transcribes, and analyzes your voicemail and calls, Google Maps is tracks your physical location (in concert with Project Beacon et all), Google Wallet becomes your payment method, Google Plus is still there for social media, if somewhat unused, Google Hangouts (aka GChat, or Google Talk) are still used commonly in the US. I mean, the Google Suite does everything and tracks everything and remembers payment methods and does everything I can think that WeChat does.

In much the same way, Experian and company increasingly are becoming the equivalent of a social credit system. You need a credit check to get a job or get an apartment now. If you have shit credit, you may as well be blackballed, because you're probably going to end up squatting somewhere and working under the table since you can't participate in the above-ground economy anymore. I mean, try getting an apartment--any apartment--in NYC with a credit score of 649. It's damned near impossible. I've had friends even with 800+ credit scores who get rejected because they have too high an unsecured credit limit (which gives you the high score), and the brokers/landlords thought that meant they were too great a risk. An ever-increasing share of jobs do this too, mostly lower-end jobs. But it's up to 30% or so of private sector employment. A majority of private sector jobs in the US also require mandatory drug tests, often at the employee's expense, and often even in states where the drug is legal. Landlords are increasingly demanding drug tests of tenants as part of the application process at least, if not random drug tests over the course of the lease. Not sure the dystopian aspects of this kind of thing are practically much worse in one place than the other.

But here's the thing--what sent me off on this little rant in the first place: In some ways all this stuff makes cash more vital, not less. If you're some working-class shlub who pissses the Communist Party off in China or some working class shlub with a 640 credit score who likes to smoke weed in the US, you're barred from major chunks of the housing or employment markets, etc. And the tighter they grip, the more people just aren't going to be able to hack it and are going to squeeze through the cracks and need to arrange deals that aren't on the books. Illegal cash sublets. Off-the-books employment. Temp work. Drug dealing. Type of stuff where if it's done in cash without a trail it's much safer. Something similar happens on the high-wealth end of the spectrum too. They always need to launder money. The money itself becomes a reserve when it seems like it's a safe medium in which to park capital. The WeChat example is interesting. But I think more and more it's why you'll see Russia (glonass), China (beidou), the US (gps), and soon the EU (galileo) each have their own GPS-style systems. I suspect they'll each get their own WeChat / Google too. Russia has Yandex and VK. China has WeChat and others. EU just hit google with a $5 billion antitrust suit and it's possible competition will arise there. I think it's increasingly becoming obviously an issue of national security to have these systems set up, because they're not just surveilling everyone all the time, they're also useful for nudging behavior and shaping public debate and setting the agenda. So I can totally see your question as to weaponizing these types of things. I think we're already well down that road. Still, in some other ways, there's still going to be a platform under the platform. The ACH network is still growing. It did something like $50 trillion dollars in 20 billion transactions over the last decade. And P2P transactions (not B2B or Payroll) were by far the fastest growing segment. Venmo in the states has grown very fast. And it's using ACH as its underlying architecture. World Bank used to do a global payment systems survey. They had like 100 or so last time I looked. Wonder if that would provide any insight.

I definitely agree that we will see a number of competing platforms, and support from sovereign governments as they recognise the power/influence that comes with superplatforms to match and surpass the power/influence of issuing reserve currencies.

But I suspect that barring any artificial constraints it is likely that fully integrated superplatforms backed by sovereign power will likely revert to an analog to Zipf's Law.

[jk]

Re: Exorbitant Data > Exorbitant Privilege

Maybe. Blockchain is incredibly clunky, heavy, and slow compared to other competing systems. The trade-off in my mind was supposed decentralization and anonymity. It has become clearer that bitcoin itself is not the best implementation of blockchain for decentralization or anonymity, I think. But the question I have is: If you were Treasury/Fed, why prefer crypto over ACH when you control ACH? More than that, why would a bunch of existing and powerful interests from banks to credit card companies want that? They might want to augment stuff with crypto. But the idea they'd want to upend existing systems still seems far off to me. Zelle and Venmo have something like 80 million US users each. There's like 5 million total bitcoin users worldwide. Crypto 10 years later is still quite cumbersome & difficult to use. These new direct to ACH apps can handle everything more easily, especially if you've got a regular phone and credit card number. Plus the transactions are not only tracked, they're public. http://www.vicemo.com. I'm not saying there's no role for blockchain. I just don't see it taking over the world in quite that kind of way. I think this is another scenario where there's probably 2 separate niches. Lots of things are sold as being the 'new x.' But it turns out they're just new and they're filling a bit of a different niche than 'x.'

yes, i agree. i was more focused on dismissing the idea of private currencies - they will be outlawed if they don't collapse on their own. and i agree, a gov't e-currency need not be blockchain based. my main thought is that gov'ts hate cash for all the reasons you cite why a lot of people like cash, and gov'ts will push toward a cashless e-currency system in which they can track every financial transaction.

[jk]

Re: Exorbitant Data > Exorbitant Privilege

lakedaemonian, i would like to hear your thoughts about the issues i raised in post #2 above.

[lakedaemonian]

Re: Exorbitant Data > Exorbitant Privilege

all the articles i've read recently re obor point to increasing suspicion and resistance after the experience of sri lanka. perhaps my sources are skewed, though, so i'm not sure how well obor is proceeding. it's also hard for me to imagine how "compelling" the use of wechat would work. every country would have to build a great firewall to match china's- but perhaps that's the point.

care to spell out how you imagine the platform being used in obor. and do you imply that the wechat implementation would also force all the participating countries to do their transactions in yuan only? i.e. that the yuan wouldn't become just a reserve currency, but would in fact become THE currency of all obor participants?

Sri Lanka was an interesting one with China providing blank check and U.N. Veto support for Sri Lanka’s liquidation of the Tamil Tigers in the civil war.

The war’s over, but the accumulated debt is not.

Victory has a steep price.

WeChat has multiple account access types/levels that also include external accounts.

It would not be technically insurmountable to expand China’s great firewall filtering and surveillance to incorporate other countries and regions.

Superplatform access and included privileges could become the new preferential and free trade agreements across the spectrum.

Implementing WeChat as the singular superplatform to facilitate essential services could make avoiding it increasingly difficult.

Leadership buy-in from developing world countries should be easy as compelling/nudging WeChat would enhance social control.

China would broader/deeper understanding of it’s global resource sellers and finished goods buyers.

Let me ask ask a question.

Would you rather control:

A) Global Reserve Currency
B) Global Superplatform

I would choose “B”.

Because the 7.1B squared Metcalfe’s Law network connections of “B” can be leveraged to undermine and replace “A” and not the other way around.

What would a currency look like in a theoretical economically, operationally, politically, and socially integrated Superplatform with 2B, 3B, 4B, 5B, 6B users look like?

If you control the global superplatform like a benign emperor, wouldn’t the power of a global reserve currency fall significantly in relative importance?

Controlling the global reserve currency may be like the golden egg, but wouldn’t a theoretical superplatform be the Goose that lays it?

[dcarrigg]

Re: Exorbitant Data > Exorbitant Privilege

yes, i agree. i was more focused on dismissing the idea of private currencies - they will be outlawed if they don't collapse on their own. and i agree, a gov't e-currency need not be blockchain based. my main thought is that gov'ts hate cash for all the reasons you cite why a lot of people like cash, and gov'ts will push toward a cashless e-currency system in which they can track every financial transaction.

I wonder. It's a mixed bag. On one level, the grip has undoubtably been on a trajectory of tightening for a majority. Cash is relatively rarer. Even minwage and temp jobs are often paying in prepaid visa cards and the like now instead of payroll checks. All of those transactions are logged. All the P2P transactions are logged. Every bank ACH transaction 10k and over is logged. On the other hand, one of our obvious local drug fronts is functioning as a used goods store and selling shit to people with credit cards with a square reader plugged into a smartphone. He'll be caught because everyone knows he's there. But everyone knew about the cash guys who came before too. Just like everyone knows about the bodega with scant inventory, several phones, and lots of print-ups of sports schedules on the wall. Some of those bookies have been there for years and years. Hard to know if the police are just customers or on the payroll (or visa-versa).

Then there's the real big fish. It's super apparent to me that Monroe Doctrine or no, the Cayman's banking system would require minimal effort by the US military to end. UK could just order it as well. If banking secrecy and sketchy cash transactions weren't desirable on some level, it seems to me a pretty simple problem to solve. Germany shook down Switzerland and they just crumpled. The US demanded a global war on drugs, and the world followed suit. Seems to me if a similar global war on cash or tax havens were declared, it would not take very long to succeed, and the revenue recovered would certainly far exceed the expense of enforcing it. And yet it does not happen. Not only does it not happen, but it's so far outside the overton window that the idea of generating US revenue by sending the 4th fleet to shut down Grand Cayman is something you won't hear almost any whacko other than me say. And anytime I've said it, most people's reaction is to begin to think up a litany of reasons why it wouldn't work. Many of these same people were gung-ho about jumping into Iraq and told me the 101st would be greeted as liberators.

Anyways, I think the fact that tax havens are allowed to operate right in Uncle Sam's back yard with almost total impunity speaks volumes about governments' willingness to turn a blind eye to criminality for various reasons. And for whatever reason, even as US dollars make up a declining share of domestic transactions, the volume of cash and cash transactions are both increasing rapidly, especially outside the US, and the US has been facilitating that in recent years, mostly by printing a lot more Benjamins. This is kind of an unrelated idea, but it has also occurred that cash notes themselves can be at least a minor limiting factor on inflation. At least they might make prices sticky. When most cash tills don't have slots for $50s or $100s, and most ATMs spit out $20s, the same in 2020 as it was in 1990, and some places even have software point of sale systems designed with UIs to exclude any denomination higher than $20 by default, I figure that has got to create some stickiness. Add it to the more major factor of flat or declining wages, and voila.



It does shock me how comfortable people are with Venmo, though. The public log of transactions is what's weird about it. It's like airing out your receipts to the world. The 3% transaction fee also seems a bit ridiculous. Especially if one's a heavy user. But people seem to love it, especially younger people. I've had kids try to get me to sign up to accept like $5 for their share of lunch. I'm resisting for now. I'd rather be owed a lunch.

But there's the real thing that's happening, right? Buying a buddy or a colleague or whomever lunch or a coffee is what Venmo et all are really attacking, I think, more than cash. In the same way that giving a buddy a ride or being a DD is a fair amount of what Uber's actually doing, I think, especially in the suburbs and college towns that never had much (if any) of a taxi business in the first place. It's turning non-market social interaction into market exchange and monetizing for being a middle man. I fully expect the day to come very soon where smart fridges have weights and sensors, not only to do what GRG describes here, but also so that the fingerprint of the person opening the door can be attached to a Venmo-style account to charge that person for whatever quantity of milk they took out of the gallon, or for how ever many beers they took off the shelf. The fridge will take 2% of the transaction, Venmo will take 3%. They'll advertise it as "Never argue about grocery prices again!" and maybe promote it in hotel and dorm-room fridges to start. Kids are especially susceptible to this stuff, because they're still malleable. So it has to be phased in a little bit. But if you step back and look at it, I think it becomes obvious that lots of growing parts of the economy are simply monetizing and de-socializing social capital. So home health aides for the elderly. Uber for the DD. Daycare. Taskrabbit for the little chores. Venmo for owing a buddy lunch.

Here's another surefire idea we'll see take off sooner than not: Disposable friends for hire. Uber for activities. Platonic Tinder. App up and pay somebody to go to the movies with. Or to go bowling with--Putnam would love that. Are you rich as hell with a Sweet 16 but not enough friends to fill the venue? Problem solved. And the whole thing will really take off when it becomes a way to pay people you're actually friends with into doing something they don't want to do. "I know you hate minigolf, but just play a round with me, you can turn on your friendapp while we're at it." Even better? Find a microtransactional way to pay people for small manners and politeness and penalize them for rudeness. I definitely see that coming a la social credit system. But I can easily see it taking off in the private sector here too. Maybe start with customer service jobs. Just have an Alexa listening for pleases and thank yous or whatever and adding a penny or less for each to a bonus account, then subtracting for everything negative. Let them charge 5% of the kitty for the service. Now we're monetizing manners.

Anyways, this is the primary mission I see Silicon Valley achieving these past 10 years or so, since it took a definitive turn toward the dark side. They've monetized everything from restaurant reservations to public parking spots. And they'll use Fitbits and other things to monetize your heart beat itself through some insurance intermediary before they're done. Any vestige of non-market human interaction must be destroyed. That's the goal. They won't be happy until the ocean itself is fenced off in plots and you're billed for the air you breathe.

But interestingly enough, that's why I think cash isn't threatening in a way. Cash can't do that. It's not as nimble. It's not as quick. Sure, there could be a donation jar you stuff a dollar in when you take a Budweiser out of the fridge. But how can that compete with a fingerprint scanner that instantly charges your account by the time you close the fridge door? By making this stuff automatic, and by having the ability to transact in fractions of a cent nearly instantly and nearly free (for the company, not the customer), there's no friction. Cash will lose out as a percentage of transactions simply because all sorts of things that aren't transactions now will become transactions. It's all a longwinded way of suggesting that I think the outcome you posit is probably where we're going, but I don't think at least here it will be government-mandated, so I think how we'll get there looks a bit different.

I think this is a more effective form of social control too. Ceiling-less ToU pricing for electricity to make people turn the heat down on cold days and the AC down on hot ones. Every road with a time-variable VMT congestion charge to make people stay off the streets. Biometric monitoring and food monitoring to punish people financially for not exercising or overeating. Making rudeness cost money and politeness pay. You can control behavior a lot more tightly by turning every human action into a market transaction than you can by simply better logging and tracking existing market transactions. Better than that? You can argue that you're doing it all to incentivize good behavior and to make the world a better place. People will call it freedom and a few can get rich off implementing it. And it won't matter that life becomes less comfortable and more stressful for most folks in the process.

[jk]

Re: Exorbitant Data > Exorbitant Privilege

dc, you have a talent for describing plausible nightmare scenarios. i've read about a show called "black mirror"- this sounds like it would fit.

also i only meant cash for the "little people" [as leona helmsley called them]. they'd never shut down the caymans. the caymans are used by the people who own this country.

same idea as unfunding the irs. we know there's an enormous return on the marginal dollar funding the irs, but that would be against the interests of people with influence.

[dcarrigg]

Re: Exorbitant Data > Exorbitant Privilege

dc, you have a talent for describing plausible nightmare scenarios. i've read about a show called "black mirror"- this sounds like it would fit.

also i only meant cash for the "little people" [as leona helmsley called them]. they'd never shut down the caymans. the caymans are used by the people who own this country.

same idea as unfunding the irs. we know there's an enormous return on the marginal dollar funding the irs, but that would be against the interests of people with influence.

It's just where I see things going. Have you driven down the Mass Pike or across the Tobin in the past few years? Tolls. No booths. Don't care if you have EZ Pass or not. The cost of finding you is so low with automation they just charge whatever they want to whomever drives by. New charge points go up. No notice. Right now only states can afford these types of systems. If and when the price comes down and towns can afford them, why wouldn't they want to raise money for town roads or "control congestion" this same way? Oregon is seriously considering compulsory universal VMT fees. Here's the pilot. Ever wanted to give the Staties an irrefutable log of your every move? Insurance companies want that data too.

Did you know that the credit ratings agencies already track your car's every move and have a national system of small cameras to follow license plates around? Even better, they sell the data. These are private eye, collections, insurance, and police standard tools in 2019. Corporate uses it to spy on employees too. In fact, one of the biggest growing sectors for this type of surveillance is collecting on student loans. Who needs a social credit score when you've got Transunion?

Meanwhile, FitBits are increasingly becoming mandatory for employees, and even for students. Desperate folks are finding ways to trick their company-assigned fitbits by putting them in socks on tumble dry low or any other creative means. They call it "a discount," but really what it is is insurance companies and/or employers charging more to customers who don't behave how they want in the off hours. There has been a market for clean urine for years. Now people just buy it on Amazon and have it delivered to their doors. Part of the price of applying to a job. Hotels already employ primitive sensors for minibars. Cheaper more effective micro scales and fingerprint scanners and accelerometers exist in cheap smartphones. It's only a matter of time before one meets the other. And some health insurance exec is liable to take the idea from the Hilton and move it into the home and call it "a wellness initiative." LG or Samsung or someone would be happy to partner with them. "The fridge that helps you lose weight!" I'm amazed this sucker isn't front and center in the showrooms already. If not first in the US, then Singapore or somewhere like that.

I don't think it's possible for unregulated ubicomp and the 4th & 5th amendments as they are to coexist. Here's a little example as to why. And I think ubicomp is clearly the better-funded and more organized side of the ubicomp vs. aclu battle. When everything's recorded all the time, searches and seizures and self-incrimination are irrelevant.

[lakedaemonian]

Re: Exorbitant Data > Exorbitant Privilege

dc, you have a talent for describing plausible nightmare scenarios. i've read about a show called "black mirror"- this sounds like it would fit.

Black Mirror can be described as Twilight Zone/Outer Limits matched with both malignant and unintended consequences of technology.

The episode "Nosedive" is incredibly frightening from a social conformity/control perspective.

[llanlad2]

Re: Exorbitant Data > Exorbitant Privilege

I wonder. It's a mixed bag. On one level, the grip has undoubtably been on a trajectory of tightening for a majority. Cash is relatively rarer. Even minwage and temp jobs are often paying in prepaid visa cards and the like now instead of payroll checks. All of those transactions are logged. All the P2P transactions are logged. Every bank ACH transaction 10k and over is logged. On the other hand, one of our obvious local drug fronts is functioning as a used goods store and selling shit to people with credit cards with a square reader plugged into a smartphone. He'll be caught because everyone knows he's there. But everyone knew about the cash guys who came before too. Just like everyone knows about the bodega with scant inventory, several phones, and lots of print-ups of sports schedules on the wall. Some of those bookies have been there for years and years. Hard to know if the police are just customers or on the payroll (or visa-versa).

Then there's the real big fish. It's super apparent to me that Monroe Doctrine or no, the Cayman's banking system would require minimal effort by the US military to end. UK could just order it as well. If banking secrecy and sketchy cash transactions weren't desirable on some level, it seems to me a pretty simple problem to solve. Germany shook down Switzerland and they just crumpled. The US demanded a global war on drugs, and the world followed suit. Seems to me if a similar global war on cash or tax havens were declared, it would not take very long to succeed, and the revenue recovered would certainly far exceed the expense of enforcing it. And yet it does not happen. Not only does it not happen, but it's so far outside the overton window that the idea of generating US revenue by sending the 4th fleet to shut down Grand Cayman is something you won't hear almost any whacko other than me say. And anytime I've said it, most people's reaction is to begin to think up a litany of reasons why it wouldn't work. Many of these same people were gung-ho about jumping into Iraq and told me the 101st would be greeted as liberators.

Anyways, I think the fact that tax havens are allowed to operate right in Uncle Sam's back yard with almost total impunity speaks volumes about governments' willingness to turn a blind eye to criminality for various reasons. And for whatever reason, even as US dollars make up a declining share of domestic transactions, the volume of cash and cash transactions are both increasing rapidly, especially outside the US, and the US has been facilitating that in recent years, mostly by printing a lot more Benjamins. This is kind of an unrelated idea, but it has also occurred that cash notes themselves can be at least a minor limiting factor on inflation. At least they might make prices sticky. When most cash tills don't have slots for $50s or $100s, and most ATMs spit out $20s, the same in 2020 as it was in 1990, and some places even have software point of sale systems designed with UIs to exclude any denomination higher than $20 by default, I figure that has got to create some stickiness. Add it to the more major factor of flat or declining wages, and voila.



It does shock me how comfortable people are with Venmo, though. The public log of transactions is what's weird about it. It's like airing out your receipts to the world. The 3% transaction fee also seems a bit ridiculous. Especially if one's a heavy user. But people seem to love it, especially younger people. I've had kids try to get me to sign up to accept like $5 for their share of lunch. I'm resisting for now. I'd rather be owed a lunch.

But there's the real thing that's happening, right? Buying a buddy or a colleague or whomever lunch or a coffee is what Venmo et all are really attacking, I think, more than cash. In the same way that giving a buddy a ride or being a DD is a fair amount of what Uber's actually doing, I think, especially in the suburbs and college towns that never had much (if any) of a taxi business in the first place. It's turning non-market social interaction into market exchange and monetizing for being a middle man. I fully expect the day to come very soon where smart fridges have weights and sensors, not only to do what GRG describes here, but also so that the fingerprint of the person opening the door can be attached to a Venmo-style account to charge that person for whatever quantity of milk they took out of the gallon, or for how ever many beers they took off the shelf. The fridge will take 2% of the transaction, Venmo will take 3%. They'll advertise it as "Never argue about grocery prices again!" and maybe promote it in hotel and dorm-room fridges to start. Kids are especially susceptible to this stuff, because they're still malleable. So it has to be phased in a little bit. But if you step back and look at it, I think it becomes obvious that lots of growing parts of the economy are simply monetizing and de-socializing social capital. So home health aides for the elderly. Uber for the DD. Daycare. Taskrabbit for the little chores. Venmo for owing a buddy lunch.

Here's another surefire idea we'll see take off sooner than not: Disposable friends for hire. Uber for activities. Platonic Tinder. App up and pay somebody to go to the movies with. Or to go bowling with--Putnam would love that. Are you rich as hell with a Sweet 16 but not enough friends to fill the venue? Problem solved. And the whole thing will really take off when it becomes a way to pay people you're actually friends with into doing something they don't want to do. "I know you hate minigolf, but just play a round with me, you can turn on your friendapp while we're at it." Even better? Find a microtransactional way to pay people for small manners and politeness and penalize them for rudeness. I definitely see that coming a la social credit system. But I can easily see it taking off in the private sector here too. Maybe start with customer service jobs. Just have an Alexa listening for pleases and thank yous or whatever and adding a penny or less for each to a bonus account, then subtracting for everything negative. Let them charge 5% of the kitty for the service. Now we're monetizing manners.

Anyways, this is the primary mission I see Silicon Valley achieving these past 10 years or so, since it took a definitive turn toward the dark side. They've monetized everything from restaurant reservations to public parking spots. And they'll use Fitbits and other things to monetize your heart beat itself through some insurance intermediary before they're done. Any vestige of non-market human interaction must be destroyed. That's the goal. They won't be happy until the ocean itself is fenced off in plots and you're billed for the air you breathe.

But interestingly enough, that's why I think cash isn't threatening in a way. Cash can't do that. It's not as nimble. It's not as quick. Sure, there could be a donation jar you stuff a dollar in when you take a Budweiser out of the fridge. But how can that compete with a fingerprint scanner that instantly charges your account by the time you close the fridge door? By making this stuff automatic, and by having the ability to transact in fractions of a cent nearly instantly and nearly free (for the company, not the customer), there's no friction. Cash will lose out as a percentage of transactions simply because all sorts of things that aren't transactions now will become transactions. It's all a longwinded way of suggesting that I think the outcome you posit is probably where we're going, but I don't think at least here it will be government-mandated, so I think how we'll get there looks a bit different.

I think this is a more effective form of social control too. Ceiling-less ToU pricing for electricity to make people turn the heat down on cold days and the AC down on hot ones. Every road with a time-variable VMT congestion charge to make people stay off the streets. Biometric monitoring and food monitoring to punish people financially for not exercising or overeating. Making rudeness cost money and politeness pay. You can control behavior a lot more tightly by turning every human action into a market transaction than you can by simply better logging and tracking existing market transactions. Better than that? You can argue that you're doing it all to incentivize good behavior and to make the world a better place. People will call it freedom and a few can get rich off implementing it. And it won't matter that life becomes less comfortable and more stressful for most folks in the process.

If supply and demand are logged in real time doesn't that solve the biggest fault in communism? ie The lack of feedback from price signals. I'm not advocating it. Just seems a potential outcome.