Sunday, February 13, 2011

The Web As Foundation To The Knowledge Revolution

``The economic problem of society is thus not merely a problem of how to allocate "given" resources—if "given" is taken to mean given to a single mind which deliberately solves the problem set by these "data." It is rather a problem of how to secure the best use of resources known to any of the members of society, for ends whose relative importance only these individuals know. Or, to put it briefly, it is a problem of the utilization of knowledge which is not given to anyone in its totality.”- Friedrich von Hayek

Dictators of Tunisia and Egypt have recently been toppled. Autocratic leaders of Yemen, Jordan and Algeria have likewise been under political pressure.

The web’s real time connectivity coursed through social media has allowed for a widespread diffusion of information...and knowledge. And this has lowered the cost of organization and mobilization that has apparently increased the demand for political spontaneous actions in the form of “people power” political movements.

In short, the economics of the web has been transforming the political order[1].

But when we read social media sceptics like such as Stratfor’s Marko Papic and Sean Noonan, who writes[2]... (bold highlights mine)

Social media alone, however, do not instigate revolutions. They are no more responsible for the recent unrest in Tunisia and Egypt than cassette-tape recordings of Ayatollah Ruholla Khomeini speeches were responsible for the 1979 revolution in Iran. Social media are tools that allow revolutionary groups to lower the costs of participation, organization, recruitment and training. But like any tool, social media have inherent weaknesses and strengths, and their effectiveness depends on how effectively leaders use them and how accessible they are to people who know how to use them...

The key for any protest movement is to inspire and motivate individuals to go from the comfort of their homes to the chaos of the streets and face off against the government. Social media allow organizers to involve like-minded people in a movement at a very low cost, but they do not necessarily make these people move.

...we understand that such objections have been founded on superficial premises-mostly from underrating the importance of knowledge and the continued the expectations that political developments flow from top-down dynamics.

Hayek’s Knowledge Revolution

Knowledge, according to the great Friedrich von Hayek[3], never exists in concentrated or integrated form but solely as the dispersed bits of incomplete and frequently contradictory knowledge which all the separate individuals possess.

This simply means that everyone’s unique perspective represents as dispersed knowledge. When dispersed knowledge are combined, exchanged, mimicked and improved upon these interactions result to fresh or innovative ideas.

Prolific author and writer Matt Ridley calls such phenomenon as Ideas having Sex[4].

Professor Don Boudreaux expounds[5] on Matt Ridley’s intellectual intercourse.

The easier it is for ideas to get together, check each other out, and jump into bed with each other, the greater will be the number of newly created ideas — ideas that would not otherwise be conceived.

Copulating ideas has also another very important role: coordination of diversified information into the production of goods and services. And this has been the path to our (human) progress.

Matt Ridley, author of the very impressive book the Rational Optimist writes[6]

``the sophistication of the modern world lies not in individual intelligence or imagination. It is a collective enterprise. Nobody—literally nobody—knows how to make the pencil on my desk (as the economist Leonard Read once pointed out), let alone the computer on which I am writing. The knowledge of how to design, mine, fell, extract, synthesize, combine, manufacture and market these things is fragmented among thousands, sometimes millions of heads. Once human progress started, it was no longer limited by the size of human brains. Intelligence became collective and cumulative.

And that’s exactly what the web has been facilitating—an unlimited orgy of ideas—Hayek’s knowledge revolution is essentially being realized through social media.

From Vertical To Horizontal Flow

In the past the flow of information reflected on how economic production had been organized: the industrial age marked by mass production and thus a top to bottom dynamic. This holds true even with the political framework. From the top down economic structure emerged the grand experiments with centralized form of governance in the form of communism, socialism, autocracy, fascism and totalitarianism.

The traditional medium of information for the consuming public had been mostly through TV, radio and newspapers. Because of the limited networks, these institutions discriminated on the information it chose to broadcast, thus the exchange of ideas had largely been constrained.

Governments easily resorted to information control via political censorship in order to regulate “the moral and political life of the population[7]” or when political leaders felt the need to advance their interests.

Controlling the flow of information meant controlling the medium. Thus, political leaders throughout history have attempted to control the medium to preserve political power.

This time is proving to be different.

Today information flows real time and horizontally, enabled by the web.

People can simply self publish their thoughts, unedited, via the blogsphere (which incidentally accounts for an estimated 133 million[8] bloggers and growing) or through privately owned websites.

People can send messages via email or even by text messages via mobile phone.

People can also air blips of short messages or comments via the online community as Facebook and Twitter.

Or produce videos via podcasting and youtube that are being broadcasted via or vimeo or video aggregators which has been posing a threat to TV.

And investors have been following the money trail.

As more and more people get wired or become netcitizens AD money spent on the internet has substantially been growing[9] see figure 6.


Figure 6: AD Spending Follow the Money Trail (Morgan Stanley)

Morgan Stanley’s Mary Meeker predicts of the explosion of mobile internet as the major source of growth for the web[10].

Even some TV programs today try to interact with the web by publishing tweets or facebook comments of audiences on air!

The democratization of information from the web or cyberspace has dramatically altered the complexion of knowledge distribution.

Gossip And The Transition To A Horizontally Based Political Order

In the hunter gatherer society, where our ancestors wandered in small tightly knit groups, gossips were used as a tool to evaluate relationships and as form of social discipline.

Aside from useful information, gossips, according to David Brooks of the Biorational[11], served to ``maintained social bonds and enforced social norms. In small groups like our ancestors' hunter-gatherer bands, in which everyone talks to everyone else regularly, liars and social cheats were found out quickly and were dealt with quickly. So lying and social cheating were relatively rare.”

The introduction of the web has basically brought back the traditional role of gossip.

For instance, Wikileaks has spilled the beans on many stealth government activities, and wikileaks has been instrumental in unleashing the popular “Jasmine” revolt in Tunisia[12].

Despite governments attempt to harass and control the founder of wikileaks, the success wikileaks has prompted for the broadening of competition.

As Professor Gary North rightly observes[13],

WikiLeaks has taken this to a new level. Now a disgruntled former WikiLeaks employee is branching out on his own. He has started a new organization, OpenLeaks. This is the kind of competition I love to see. A Reuters story describes what is about to happen. "All across Europe, from Brussels to the Balkans, a new generation of WikiLeaks-style websites is sprouting."...

As the number of these sites increases, it will become more difficult for governments to contain the leaks. The desire of leakers to become important overnight will grow.”

Of course governments can initiate countermoves such as instituting “firewalls” (as in the case of China) or kill-switch strategy[14] or the shutdown of ISP providers or disseminate counterpropaganda.

Cuba’s government for instance has designed a campaign to counter the web. Unfortunately this was again exposed, according to Wall Street Journal’s Mary O’Grady[15]

Last week a leaked video of a Cuban military seminar on how to combat technology hit the Internet. It demonstrates the dictatorship's preoccupation with the Web. The lecturer warns about the dangers of young people with an appealing discourse sharing information through technology and trying to organize.

As in the case of Egypt, the kill switch strategy has ultimately failed[16].

Circulating political propaganda or spreading disinformation can easily neutralized by “local based” knowledge or by speciality sites (e.g.

One important development from the web is that it has altered the way governments have been behaving, as governments seemingly become more cautious and possibly less repressive in dealing with transgressors or with the political opposition, as in the case of China.

Borje Ljunggren of Yale Global notes of several incidences and sees[17] that

In case after case since 2004, the internet has dramatically changed the course of an event, forcing the party to maneuver between response and repression.

Mr. Ljunggren further notes that Chinese state control of information has also been under pressure,

He further writes, (bold emphasis mine)

Censorship is an organic part of the party-state and will no doubt remain a crucial weapon, but its usage is increasingly exposed as the Chinese internet society becomes aware of the extent to which entrenched party interests determine their access to information. As a consequence, an idea of a “right to know” is taking shape in China’s rapidly growing online civil society and this could, in Shirk’s analysis, become “the rallying cry of the next Chinese revolution.

While internet freedom clearly is not about to be declared, civil society and new technology will over time push limits beyond the axiomatic boundaries of the party-state.”

As one would notice the vertical-hierarchal structure of governments are constantly held under pressure by the democratization of knowledge.

And this should apply with political ideology too.

Political and economic ideology latched on a vertical top-bottom flow of power will be on a collision course with horizontal real time flow of democratized knowledge.

This would likely result to less applicability of ideologies based on centralization, which could substantially erode its support base and shift political capital to decentralized structure of political governance that would conform with the horizontal structure of information flows.

People will know more therefore control from the top will be less an appealing idea.

The final word from futurist Alvin Toffler[18], who predicted this Hayekian Knowledge Revolution which he molded through as his Third Wave concept.

``Computers can be expected to deepen the entire culture’s view of causality, heightening our understanding of the interrelatedness of things, and helping us to synthesize meaningful “wholes” out of the disconnected data whirling around us....The intelligent environment may eventually begin to change not merely the way we analyze problems and integrate information but even the chemistry of our brains.”

[1] See The Web Is Changing The Global Political Order, January 29, 2010

[2] Papic Marko and Noonan Sean Social Media as a Tool for Protest, February 3, 2010

[3] Hayek, Friedrich August von The Use of Knowledge In Society, Individualism and Economic Order,, p.77

[4] See Matt Ridley: When Ideas Have Sex, August 11, 2011

[5] Boudreaux Donald J. Promiscuous, Productive Ideas, CATO Unbound, September 10, 2010

[6] Ridley Matt, Humans: Why They Triumphed, Wall Street Journal, May 22, 2010

[7] Newth, Mette Newth The long history of censorship Beacon for Freedom of Expression, 2001

[8] Bradley Phil, Great Blog statistics, Phil Bradley’s Weblog

[9] See The Deepening Of The Information Age: News Sources And Ad Spending, January 7, 2011

[10] Meeker, Mary Internet Trends 2010 by Morgan Stanley Research, 2010

[11] The Bio-Rational Institute Pleistocene brain, mobile phone, May 26, 2006

[12] International Business Times, Wikileaks helped spark Tunisia revolt : FPJ January 29, 2011

[13] North Gary When the Insiders Lose Control, February 3, 2011

[14] Cowie James, Can the Internet Tame Governments? – Part I, Yale Global, February 9, 2011

[15] O’Grady, Mary Anastacia Will Cuba Be the Next Egypt?, Wall Street Journal February 7, 2011

[16] See Egyptian Revolt: Web Censorship Fails, February 1, 2011

[17] Ljunggren Borje Can the Internet Tame Governments? – Part II, Yale Global February 11, 2011

[18] Toffler, Alvin The Third Wave p 175

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