In this chapter, Lanier discusses the fallacious reasoning of "cybernetic totalism," which the blog Transfer Protocol identifies as an "idolization of technology to the point where our relationship with the technology itself becomes the only measure of humanity." Janier links cybernetic totalism to "out-of-control financial instruments" as well as the "fates of musicians" (Janier 94) due to the free music internet movement.
Regional Fates
China's rise to wealth has a lot to do with their concentration on "cheap high-quality labor," (94) and Lanier predicts that sometimes in the next twenty years or so, a huge number of jobs in China and other places using similar strategies will be "made obsolete by advances in cheap robotics" (94). This would affect hundreds of millions of people as far as jobs go. On the other hand, India's economy began thriving at the same time as China's, although with a different model: they achieve most of their wealth through "call centers, software development, computer animation and outsourced administrative services" (95).
Question: (in text) "If waves of technological change bring new kind of employment with them, what will it be like?" (94) Who would be affected positively and negatively?
Computationally Enhanced Corruption
Lanier explains how "cataclysmic financial management" (96) disasters have occurred as a result of big computer networks and what he refers to as the "cloud." The financial disasters of 2008 (i.e. Fannie Mae, Freddie Mac) were "significantly cloud based," according to Lanier. He claims that the rise of "computer-assisted hedge funds" has "turned capitalism into a search engine" (96). Lanier believes that because of these things, capitalism has been ushered into a new phase which is not working.
The Cloudy Edge Between Self-Delusion and Corruption
Again, the 2008 American financial crisis spurred by a "mortgage meldown" was a case of "too many people believing in the cloud too much" (97).
The Big 'N'
Individual "human creativity and understanding" are "treated as worthless in this system, so people are driven to trust in the crowd, or "the big N" (98) or the "algorithms that remove risks of creativity" (99).
Chapter 7: The Prospects for Humanistic Cloud Economics
This section provides alternatives to currently indoctrinated ideas about digital economics.
The Digital Economy: First Thought, Best Thought
Question: (in text) "Are there any alternatives/options that exist apart from the opposing poles of old media and new culture?" (100)
Question: (in text): "Is there any way to bring money and capitalism into an era of technological abundance without impoverishing almost everyone?" (100)
In response to this question, Lanier provides an idea originated by Ted Nelson, who invented the digital media link. Nelson's idea is that we should keep only one copy of each "cultural expression" and "pay the author...a small, affordable amount whenever it is accessed". In other words, people would be able to post to their blogs and then make a small bit of money every time someone clicked through to your site or interacted with its content. Lanier supports this idea, asserting that it would reward "individuals instead of cloud owners." He believes that most people would support a system in which "bits have value instead of being free" in order to support individual artists. He champions the idea, claiming that it would "celebrate personhood... because personal expression would be valued" (101.)
Pick Your Poison
Question: (in text) With the system suggested above, wouldn't the government have to be closely involved in order to enforce laws to compensate people? Would it be intrusive and would it lead to a loss of liberty? (102)
Again, Lanier emphasizes that with Nelson's system, "creative expression could...become the most valuable resource in a future world of material abundance" (103).
Putting a monetary value, albeit a small one, on these "bits" would indeed put a greater value on them, but would people really want to pay for it when we are so used to having access for free?
It Isn't Too Late
Question: (in text) "How could a transition from open copying to paid access work?"
Lanier argues that governmental solutions to these problems would be necessary, and that people would have to "all agree in order for something to have monetary value" (105). It's true: if a service that was formerly free was suddenly for pay, most people probably wouldn't pay for it, unless it was of an increased value, such as Nelson's system would presumably provide.
If most people view this as fair, then it will happen, according to Lanier. Any economic idea can be undermined or supported by "perceptions of fairness and social norms," so everyone must be in a agreement that it is "worth paying for one another's elevated cultural and creative expressions." Lanier insists that the system for payment must be "universal" and "simple" (105) because it would be too much for someone to keep plugging in their credit card number to every site they visit, much less dangerous.
The Transition
One idea Lanier has for the transition to this new system is for people to stop paying a monthly fee to their internet service provider, and to instead sign up for this new "social contract in which you pay for bits" (106). Lanier argues that people are entrepreneurial at heart and "would like to see the chance to try to make money from their bits" (107).
Chapter 8: Three Possible Future Directions
This section identifies 3 projects of Lanier's in order to "correct some of the problems described in Chapter 4." The first two ideas, "telegigging and songles" have to do with issues concerning the "future of paid cultural expression." The third idea, "formal financial expression," is very dense and has to do with an approach to keeping "the hive from ruining finance" (108), the "hive" being the tendency to gravitate toward whatever is the easiest place to find content, but not necessarily the best content.
Telegigging
This is basically live performance on the internet by artists. Lanier argues in favor of it because artists wouldn't have to travel, and the practice would be immune to problems presented by online music sharing which has crippled music labels and music stores alike.
Songles
Lanier identifies these as "dongles for a song," dongles being defined as small pieces "of hardware that you plug into a computer to run a piece of commercial software" (109). These objects could be coffee mugs, bracelets, rings, whatever. Lanier says that songles would make hardware such as iPods unneeded because people would be paying for content rather than hardware.
Lanier lists the pluses of songles, which would make the music business "more romantic" (110), lower the cost of promotion because songles would come in limited editions based on quality. He claims they would also "broaden channels by which music is sold" and raise the margin for "high-prestige but low-volume music" (111) such as opera and fine jazz through scarce limited editions.
Formal Financial Expression
This section describes problems of who Lanier refers to as the "lords of the clouds, not the peasants" (111). It has to do with the way monetary transactions are handled via the internet. One technique Lanier suggests is one that uses Artificial Intelligence to "create formal versions of certain complicated or innovative contracts that define financial instruments" (113).
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