One of these days I'm going to learn the art of succint writing. On Sun, 28 Apr 1996 mkj@october.segno.com wrote:
Which brings us to the "flight of capital" issue. Will nations be able to compete freely for the loyalty of the rich? Or will the most powerful nations form effective coalitions, and perhaps simply bomb "rogue" nations into the stone age?
I don't think the rich are really the issue. From what Sandy, Black Unicorn and others write, it looks like those of the rich who are self-employed already play these shell games to a certain extent and a certain amount competition and thumb-screwing already happens. What is interesting is how it applies to the middle-class, where most of the tax-base is. Imagine a world where for cost reasons most offices are VR constructs (a la Snow Crash and all the others) run over the net. Assume that for privacy reasons, nobody in their right minds goes without crypto since any cracker could literally be recording their whole lives. (And assume that this gets built into all the software or the users scream murder as hard as we did when Netscape's CEO looked like he was waffling on GAK.) Assume that some enterprising jurisdictions find some *reliable* means of automating entity creation and use of all the offshore services (creation of companies, trusts, doing financial transactions...) and offer a standard API to these services, making the whole game a commodity and as easy to access as downloading Netscape. Assume that somehow secure pseudonymous financial markets can be created. (Big if, but also big profits) Also assume very low transaction fees as a result. The result of this might be that the netshore economy might actually have lower overhead and an easier interface to its users than the physical world version. If people's easiest intro to economics and the job market is such a simple anarchy and the place where they get most of their entertainment, education and generally spend most of their lives is such an impossible to regulate environment, what do you think this bodes for state control? Or people's desire for it? There is no teacher like experience. Many of us have found it safer to use a pseudonym, sometimes even to save ourselves from occasional embarassment when saying stupid things (nevermind privacy from altavista and whowhere). I think it is natural for people to want such things, especially in a VR environment when anyone can watch you. I assume that in this the cypherpunks, roleplayers, MUD players, political writers and BBSers are not radical but merely slightly ahead of the curve. It is also not a coincidence that pseudonymity keeps getting reinvented in new environments. Basic human need. These games have all been possible for quite some time in the offshore market and seem far more developped. I've read that there are as many registered corporations in the Cayman Islands as there are inhabitants. It might actually be less of a hassle to conduct your business as a corporation than as a individual. Even here in high-tax Canada there are nifty tax benefits (I'm told). Foreign jurisdictions might also be easier to deal with as a corporation (do you *really* want the Chinese government to know that you're doing business with their people? Do you want to get on Saudi Arabia's blacklist?) How do you think most people will act when they learn that just by putting on their glasses they could enter a tax-free jurisdiction with perfect privacy? THIS meme does travel. Now many here think that unless we get chaumian ecash Real Soon Now, none of this will happen. I submit that there will be far more demand for it in the years to come than right now. Anonymous ecash is still several years ahead of its mass-market time. I don't see how in the absence of GAK or any other mandated ID scheme that it will be any easier to stop it (maybe you do). And market share? How can VISA and Microsoft compete against something that lets you save on taxes (why compete *against* it when you can be part of it?). Marketing this is a no-brainer. The only extra expense I can see is that if you're large enough, you might need more accountants to help with your double-booking. (Though maybe you could fire them all if the system is done right) Finally, how will you regulate disputes? Last week we had just this problem. Now imagine how these things will be resolved when real money is involved and force cannot be applied. Arbitration is already "in" in the real world... It's much faster than the average court. What do you think will happen when enough people get exposed to that? Arbitration negotiators (lawyers) might be quite cheaper than real lawyers, after all there's less rules to learn (probably standardized and commoditized) and a global market of them (competition!). Markets can also be set up for transferable lawsuits with greater ease... In sum we're talking about the age of the global small business. As long as you're in the service industry, and you don't deal with physical goods, even if a only few of these things happen, life will be interesting. Ps. Micheal Froomkin disagrees with this. How for example will you escape having your house seized, how will you convince a large institution like his university to pay you as a longterm contractor...? I may be unrealistic, but judging from what is happening to university funding in this country, the increased number of for-credit university courses done by video or TV (Carleton U does 'em), the increased demand for knowledge workers and the increase in small specialty colleges, I'd say he might dean of the www.law.anguila.edu online law school sooner than he thinks. And as for his house, getting "payment" from your "employer" (trust fund/company) only for your expenses is already quite possible and (so it's been said around here) seemingly legal (IANAL!) He might even rent it from some odd offshore real estate company (himself). The only difference compared to now is that it might eventually become alot easier. Thinking of setting up your own universities, folks?