Overthrowing the Network State

= Podcast series in reaction to Balaji Srivanasan's book, The Network State

Summary

Insights, in bullet points per episode, via [1]

OTNS EPISODE 1

Definition of a Network state: « A network state is a highly aligned online community with a capacity for collective action that crowdfunds territory worldwide and eventually gains diplomatic recognition from pre-existing states. » Balaji Srinivasan.

• Step by Step guide to building a network state:
  • Found your startup society
  • Organize it as a group capable of collective action (capacity to act is essential, being a community is not enough)
  • Build trust offline and a crypto economy online (need in-person meetings to build trust between various members).
  • Crowds found physical nodes. Collectively buy land and housing to live together as a community
  • Digitally connected physical community
  • Conduct an on-chain census. It needs a way to prove there is an online population (a decent number of people and a sufficient number of incomes and a footprint in the real world)
  • Gain diplomatic recognition (the most contentious one)

• Problems with the Network State Framework:
  • There needs to be more than owning a territory to proclaim itself as a state, apply its own laws, and escape that of the sovereign state.
  • Exit-based governance is authoritarian governance.
  • This model can lead to an ultra-capitalist model of society.

• Alternative Framework: “CoordiNations”
  • It relies on common-based governance, which promotes cooperation rather than competition.
  • Cooperation is stronger than the competition.
  • Nations can exist over several states because they don’t need territories but only collectives and identities.
  • A nation can coexist with every other state and existing nation and can even cooperate with them.

OTNS EPISODE 2

• An innovative concept's path, from its creation to its establishment, impacts its image.

• Governments are not good at governing the commons, so people try to find more efficient alternatives, which explains why people are interested in “The Network States.”

• It is impossible to find people aligned enough on fundamental principles to unite them so that they are capable of collective action because they will disagree on other things.

• Balaji does not write about implementing Networks States, whereas the establishment leads to many paradoxes.

• Diversity and plurality are not eliminated but just moved outside of the Network State, which just moves the problem away.

• Exit-based governance, as described here, leads to highly centralized networks.

OTNS EPISODE 3

According to Douglas Rushkoff, the concept of "exit" is rooted in centralized currencies and financialization.

The recent rise in exit governance for two reasons: individuals who seek exit due to a different vision and those who seek exit because they feel they have destroyed their world.

Recent interest in exit governance is due to disillusionment in voice-based governance or a decrease in the cost of exit-based governance.

Being part of a community incurs significant exit costs, as one must rely on others while simultaneously being relied upon.

It is easier to exit when you have money.

Tech CEOs who see exit governance as the best means of governing suggest that they are solely interested in it because they fear debt and commitment. People don't want to be burdened with making political decisions every day; thus, they delegate their voices to those dealing with politics. Current governments are not equipped to handle global issues. Therefore, people interested in “The Network States” are seeking alternative mechanisms for coordination.

A Renaissance occurs when things once repressed in the past are reborn while others are diminished.

Being local can empower people and enable them to address issues they can directly impact rather than trying to deal with global issues.

OTNS EPISODE 4

Balaji's historical understanding of politics is based on a narrow and limited perspective, making it hard to take his ideas seriously. His book is also filled with inaccuracies.

Balaji argues that every organization starts with a strong leader gathering people around him, contradicting anthropological studies.

The concept of polycentric governance is introduced, and it is noted that it provides an alternative framework for governance. While generally inefficient, the blockchain offers a solution by making monitoring free by design. Furthermore, polycentric governance can be adapted to each case, making it more flexible and enforceable.

Digital commons face different challenges compared to real-life commons. Blockchain technology offers greater security and scalability for digital commons."

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Directory of transcripts

Episode 1: Primavera De Filippi on the Critique of the Network State Concept of Balaji Srivanasan

Podcast via https://theblockchainsocialist.com/overthrowing-the-network-state-an-initial-critique-and-alternatives/

"In the first episode of our series ‘Overthrowing The Network State’ (OTNS), we dive into the world of Balaji Srinivasan’s recent book The Network State. The purpose of this series is to critique The Network State while also pulling out the salvageable parts and concepts in discussion with a variety of guests. We are overall critical of Balaji’s specific ideas in the book, but we want to discuss it with intellectual honesty and highlight the larger concepts around how these technologies are and could subvert state structures.

For this episode I’m joined by Primavera De Filippi (@yaoeo), a long time researcher on blockchain and the director of Blockchaingov as a co-host. We give a brief overview of who Balaji Srinivasan is, some of the main concepts in his book, our initial criticisms, and some alternative book recommendations. By OTNS we don’t want to only provide critique, but we want to provide a very different conceptual framework that answers why people people seem to be tapping into the book. For us this is about exit-based governance (lack of politics with an idealistic view of autonomy ) vs. commons-based governance (which recognizes the inherent ‘interdependence’ of the world and global society)."

Summary of transcript:

"The Network State approach presents a major problem as Balaji Srinivasan believes that owning land is sufficient to impose any rules on it. However, according to Wikipedia, "A state is a centralized political organization that imposes and enforces rules over a population within a territory." Therefore, owning land on a territory already governed by a state does not give the landlord the right to escape the state's rules and establish their own.

Moreover, simply declaring oneself a state by hoisting a flag on a piece of land is not enough to be recognized as such. Other states must give it a certain legitimacy. Attempting to seize a part of an existing state, imposing one's laws on it, and bypassing the former will not aid in achieving recognition.

In his book, Srinivasan defines the governance structure of this state as "exit-based governance." Based on the forking concept, if a person or group disagrees with the dominant group in the Network State, they can fork and create their own Network State. This exit-based governance is authoritarian as the founder sets the rules, and one must agree to stay in NS.

BioShock comparison: The Blockchain Socialist makes an interesting comparison between the book and the game BioShock. It is a video game where the player embodies someone exploring an abandoned city underwater. Along the game, the player discovers this place was built in the 50s by a billionaire named Andrew Ryan because he wanted to exit existing laws and regulations. Thus, the city, called “Rapture,” was governed under an ultra Capitalism system but seemed to have collapsed after people tried to go on strike and escape. This game criticizes the philosophical system theorized by Ayn Rand in the 50s, called Objectivism. Objectivism is about Rational Egoism, which means that a man should always focus on his happiness above all. In practice, it leads to a society with no social aids, no religion, and no interventionism.

Finally, The Blockchain Socialist said, "BioShock could be seen as a Network State manifestation.”

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Episode 2: Glen Weyl on Overthrowing the Network State‎

Podcast via https://blockchaingov.eu/overthrowing-the-network-state-forming-new-publics-and-pluralism-with-glen-weyl/

"In this episode, Primavera de Filippi and The Blockchain Socialist welcome Glen Weyl, the founder of RadicalxChange and co-author of Vitalik Buterin’s article on Decentralized Society."

Summary:

For the second episode of Overthrowing the Network States, the podcast series hosted by The Blockchain Socialist and Primavera de Filippi, they welcome Eric Glen Weyl, an economist and a researcher at Microsoft Research New England, where after being a Web3 CTO advisor, he now leads the Plural Technology Collaboratory, the world’s largest plural technology research group. He graduated with a Ph.D. in Economy at Princeton. Then he taught at Harvard and Yale. He co-authored the book « Radical Markets: Uprooting Capitalism and Democracy for a Just Society » with Eric Posner. This book has gained recognition in the Web3 community, including Vitalik Buterin's interest, bringing him to crypto. Later, he founded RadicalxChange, a nonprofit foundation dedicated to building a community and education about democratic innovation. He is also the founder of Plurality Institute, which aims to gather people from various fields, such as computer science, political ethics, sociology, and government, to develop and experiment with Plural Technologies. How to broadcast a disruptive idea?

Primavera de Filippi underlined a similarity between « Radical Markets » and « Network States » because their two books became famous because of the underlying concepts they carry. Eric's book is based on the idea that market design can be redesigned, while Balaji's book proposes the possibility of exiting society and creating a new one.

About this, Weyl described the journey that crosses an idea from the creation to the application in two ways:

• The optimistic one: people are more likely to follow and believe in an idea when it is carried and embodied by a person who acts like a guide. According to Eric, the guide here is Balaji, who eliminates his enemies with his sword.

• The pessimistic one: sometimes, even for well-intentioned groundbreaking concepts, they can’t be cleaned from the drips from the sword. To illustrate this purpose, Eric takes the example of Marxism, which suffered from a bad image more than a century later, mainly because of USSR totalitarianism, and the thousand of dead made by Lenine and Staline regimes to impose their conception of communism.

The problem with current governments

Balaji believes that governments were created to manage interdependence between people that markets could not regulate, but according to Eric, markets cannot address most of the challenges people face. Governments have never been able to manage all the issues arising from the links between people.

Balaji suggests that new publics need to emerge and be empowered to govern relevant issues. Many edge cases are appearing, showing that states aren’t always efficient. Eric’s example of rivers that flow through multiple countries shows that state management is inefficient regarding everyday resources.

The need for alternatives

As previously mentioned, "The Network State" inspires the Web3 community to envision a more efficient alternative to the current system of states and nations, a world they would prefer to inhabit. Balaji proposes to bring together highly aligned communities based on shared values or interests. This requires sufficient alignment among individuals to enable collective action.

The limits of The Network States

But later in the episode, the three speakers stroke that it is impossible to find something fundamental enough to unite a good amount of people capable of collective action only because they agree on one basic thing since they can disagree on a lot of other things. Even at the end, they made jokes about practical cases to show to what extent the idea of a network state cannot work. By the way, Balaji never explained in a concrete way how all this networks states are interconnected. Indeed, because the Network States are based on governance, how is it possible to benefit from service from another Network State if your two network states are based on different alignments (which are not necessarily opposite, just different)? He does not write about the precise implementation, even if it would be desirable since many paradoxes appear just by quick, simple thinking exercises.

It also shows the limit of exit-based governance. Indeed, exit in the tech world can work: if people are unhappy with a service, they can still choose another one. But Balaji wants to apply this to state governance: he wants to throw politics out of the picture by the assumption that « if everybody is highly aligned, whatever the founder (who is also the commander) of the NS will do, the community will agree. And if not, people can leave. But, unfortunately, the exit-based governance proposed leads to a highly centralized society, which makes The Blockchain Socialist thinks that people from the Web 3 community that agree with this book have not read it. Also, exit-based governance just eliminates the diversity that exists in actual states. But if one takes a step back, a Network State world is a world with a plurality of communities instead of a majority of individuals, so politics do not happen inside the network state, between all the Network States, where exit does not exist anymore. So « The Network States » has not deleted the problem of agreeing on a compromise; it has just moved it to another place…

Finally, The Network States vision appears to be a simplistic application of the tech startup mindset to state governance, overlooking many inconsistencies and paradoxes, even if the underlying idea of trying to find a more efficient way for people to gather around the similar interest to be more efficient than states currently are. Eric Glen Weyl proposes a more comprehensive alternative called "Network Society." In this system, every individual is part of a plurality of governance networks democratically governed by participants, making them decentralized. Also, every member is part of other networks, which kind of defines identity because nobody can have the same pattern. This means, by creating plurality and diversity, still brings people together."

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Episode 3: Douglas Rushkoff

Podcast via https://theblockchainsocialist.com/overthrowing-the-network-state-survival-of-the-richest/

"For this episode, Primavera and I speak with Douglas Rushkoff (@rushkoff). Named one of the “world’s ten most influential intellectuals” by MIT, Rushkoff is an author and documentarian who studies human autonomy in a digital age. His twenty books include the just-published Survival of the Richest: Escape Fantasies of the Tech Billionaires, which we found to be relevant for understanding The Network State.

Overthrowing the Network State (OTNS) is a series in collaboration with Blockchaingov where we critique The Network State by Balaji Srinivasan while also pulling out the salvageable parts and concepts in discussion with a variety of guests. We are overall critical of Balaji’s specific ideas in the book, but we want to discuss it with intellectual honesty and highlight the larger concepts around how these technologies are and could subvert state structures."

Summary:

"In this episode, The Blockchain Socialist and Primavera de Filippi chatted with Douglas Rushkoff, a renowned writer, and documentarian who studies human autonomy in the digital age. Rushkoff, named one of the “world’s ten most influential intellectuals” by MIT, joins the conversation to discuss “The Network State” by Balaji Srinivasan.

He has written ten books on media, technology, and culture.

Rushkoff is a Media Theory and Digital Economics Professor at the City University of New York, Queens College. He is a prominent media theorist and writer whose work has focused on the impact of technology and media on society. Rushkoff's early work was inspired by the San Francisco rave scene of the early 1990s and the emerging world of cyberculture. His first book, Cyberia, was initially planned for publication in 1992 but was delayed since Bantam says the internet would end in 1993. But it was eventually released in 1994. Since then, Rushkoff's views on media and technology have evolved from a techno-utopian perspective to a more nuanced critique of cyberculture discourse. He explores themes such as media interaction, media literacy, intention and agency, and the impact of media on religion, culture, politics, and money.

At the podcast's beginning, he returns to the ’90s, with the birth of the Internet. He was convinced these technologies could be let to people and “[...] can help make things better”. But moreover, he asserts, “If we don’t understand what is going on, we will lose the benefit from it.”

The Concept of 'Exit': From Startup Culture to Governance and Responsibility

According to Douglas Rushkoff, "exit" is rooted in centralized currencies and financialization. In the early days of P2P markets, money was made through exchange, but modern societies now rely heavily on a service economy. Rushkoff notes that many Silicon Valley tech startup CEOs understand that their businesses are not built to last but rather to be sold at a high price for a significant profit. This stands in contrast to the traditional model of a pizzeria owner who opens a business to serve quality food to customers rather than sell it later on.

However, the concept of exit is no longer limited to startups. There has been a recent rise in exit governance for two reasons: individuals who seek exit due to a different vision and those who seek exit because they feel they have destroyed their world. Rushkoff provides the example of a journalist who writes an article their editor refuses to publish. Rather than attempting to persuade the editor with convincing arguments, the journalist may choose to leave and claim their right to write what they want. But Rushkoff cautions that there are times when it is important to withhold publishing until the appropriate moment, as exemplified by the Watergate scandal.

Exit-Governance, towards total freedom?

In the discussion, Dr. de Filippi delves into the comparison between exit-based governance and voice-based governance, particularly in terms of the cost of governance. She asks Rushkoff if the recent interest in exit governance is due to disillusionment in voice-based governance or a decrease in the cost of exit-based governance.

Rushkoff notes that in "The Network States," individuals who wish to escape must be wealthy enough to purchase land, meaning that the exit cost is naturally lower for those with the means to do so. He emphasizes that being part of a community incurs high exit costs, as one must rely on others while simultaneously being relied upon.

Rushkoff aims at wealthy tech CEOs who see exit governance as the best means of governing, suggesting they are solely interested in it because they fear debt. According to Rushkoff, it becomes a fear of commitment, leading these CEOs to seek total freedom from debt, commitment, and constraints. In contrast, a community involves owning something to someone else, thus creating relationships between individuals.

Rushkoff concludes by likening "The Network States" to a group of young boys who build a treehouse and put up a "BOYS ONLY" sign, but at the state level.

Governance Models and Proposing a Vision for the Future

After criticizing exit-based governance, Douglass Ruskoff acknowledges the weaknesses of voice-based governance. He highlights the danger of a significant portion of the population believing in something totally false and using their voice to shift an election. He then points out that some Silicon Valley CEOs have a techno-elitist vision, believing they understand technology better than most people. Therefore, they should make choices for themselves. World leaders have also been known to agree with this vision, arguing that people don't want to be burdened with making political decisions every day, and thus, they delegate their voices to those who deal with politics.

Primavera then shares her opinion on The Network States. She believes people are interested in the book because they recognize that current governments are not equipped to handle global issues. Therefore, they are seeking alternative mechanisms for coordination.

Douglass then proposes his own vision, suggesting that a Renaissance occurs when things once repressed in the past are reborn while others are diminished. He believes we do not need over-globalization and can deal with many aspects of our lives locally. Douglass suggests creating overlapping layers of sovereignty, allowing people to govern and be governed. Living more locally can reduce the stress on the global system, which could be a way to solve existing problems, such as global warming, by reducing the exchange and journey of goods all over the world. Additionally, being local can empower people and enable them to address issues they can directly impact rather than trying to deal with global problems.

Conclusion

In the end, the conversation highlighted the need for innovative thinking and approaches to governance that can address the challenges of our complex and interconnected world. While there may be no one-size-fits-all solution, exploring alternative forms of governance and considering the costs and benefits of exit and voice-based approaches can help us create more effective and sustainable governance systems."

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Episode 4: Quinn DuPont on Digital Polycentric Governance

Podcast via ?

Summary:

"In this episode, the hosts interview Quinn DuPont, a technology historian who recently talked about his criticisms of TNS at the Commons Stack Unconference. DuPont also published an article titled "A Progressive Web3: From Social Coproduction to Digital Polycentric Governance". The discussion focused on Balaji's misunderstandings of history, which are problematic.

Balaji’s historical misunderstandings

At the start of the podcast, the speakers question Balaji's preoccupation with the nation-state and its legitimacy and suggest exploring alternative options like DAOs. They criticize Balaji's idea of projecting a particular future and his belief in a single trajectory of history, which they find outdated. Quinn points out that Balaji's vision of the history of politics is based on mid-20th-century scholarship, which is a narrow and limited perspective. They also bring up the historical inaccuracies in Balaji's book, making it hard to take seriously. The speakers advise fact-checking the information to avoid falling under an ideology. They find it amusing that Balaji accuses the New York Times of this while his book is filled with inaccuracies.

Balaji has a poor understanding of human societies and organizations' creation. Balaji argues that every organization starts with a strong leader gathering people around him, contradicting anthropological studies. Dupont points out that nations and other collective activities don't start that way, and he disagrees with Balaji's claim that people need a strong leader to speak for them. Quinn argues this type of thinking only leads to totalitarianism.

Then they shift to the concept of "human pattern" and acknowledge that some sociology studies support the idea that humans follow specific patterns. However, there are no academic references or citations to those studies in Balaji's book. Without proper scholarly support, taking Balaji's ideas seriously is difficult.

Governance of Commons

During the podcast, Kelsie prompts Quinn to discuss his paper and explore why the idea of community networks resonates within the web3 community. First, Quinn introduces the concept of "Polycentric Governance," which was theorized by Elinor Ostrom. While he acknowledges that it is not an efficient model, he notes that it provides an alternative framework for governance. However, Quinn later comes back to this subject, saying that in polycentricity governance, monitoring every center of governance can be highly costly, making it generally inefficient. However, the blockchain offers a solution to this problem by making monitoring free by design. This is why we can observe examples of polycentric governance on the blockchain, such as DAOs. Next, they compare this governance model to the Network State and note that according to Balaji's book, the Network State has only one way of organizing (which is not really clear according to The Blockchain Socialist). In contrast, polycentric governance can be adapted to each case, making it more flexible and enforceable.

Another aspect of polycentric governance is that, in many ways, it appears to be an excellent way to govern commons. So later in the podcast, the topic of "digital commons" arises, referring to online resources such as Wikipedia or those on the blockchain. Quinn Dupont notes that digital commons face different challenges compared to real-life commons. For example, physical commons are often subject to congestion or overuse, which is less likely to occur on the digital front, or at least not to the same extent. However, digital commons are more susceptible to scaling issues and security breaches, which are more prevalent online. Fortunately, blockchain technology solves these problems, offering greater security and scalability for digital commons. Kelsie revisits the paper mentioned at the beginning of the podcast, "A Progressive Web3: From Social Coproduction to Digital Polycentric Governance," and asks Quinn to delve into it further. Quinn begins by touching upon the two critical aspects of technology and culture, highlighting how the Web3 landscape has transformed drastically in recent years. He points out that the people involved, their interests, and their interactions vastly differ from when he first began exploring Bitcoin in 2012.

Finishing with blockchain governance, Quinn notes that there are several attempts at governance and dispute resolution mechanisms, although they may not always be sophisticated. However, he cautions against centralization with governance tokens, as many individuals tend to delegate their governance power to delegates, thereby giving more influence to entities like Easy 16, a VC firm from Silicon Valley, which is increasingly gaining prominence in the Web3 space."

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