Interesting discussion. I'm thinking another inflection point which could tip the balance would be some travel technology breakthrough -- 100x faster, 100x cheaper (relative to individual wealth -- which itself increasing in real terms over time as productivity improves due to automation, efficiency, process improvement etc). If you could shrink the world so that people can basically commute from anywhere to anywhere for a cost significantly less than the difference in tax rates between tax havens such as Bahamas (0% income tax) compared with western direct and investment tax rates of 40-60% and beyond marginal rates. - This is mostly why I was disappointed to see the plans to scrap concorde -- it was expensive in real terms due to current fuel and current salaries as set by current economic climate; however with a cruise speed of mach 2.0 it was 2.4x as fast as typical passenger jets. (Originally planned for mach 2.5 - mach 3.0, but material science wasn't up to the task when concorde's were built in the 70s). But scrapping them seems like a step backwards. So there were merchant bankers and celebrities jetting backwards and forwards from new york on it. But what wealthy are doing today can be what everyone is doing some years on when things have become cheaper relatively speaking. - The other aspect of travel speed -- the crappy depature and arrival procedures -- have gotten significantly worse since WTC terror attack. The current political climate is as a result a poorer one for business as it has basically increased the cost of travel (in convenience). - So what about other travel: magnetic levitation trains, mag lev trains in vacuum tubes, nuclear powered transport (with design margin to amply cope with safety issues); and further out maybe teleportation. - The other issue is how governments would react to transportation advances -- maybe just change tax laws so you get charged the max of countries you work or reside in. - Another potential and probably more likely to happen medium term technology could be improvements in display technology making telepresence more functional. 3d projective displays able to project into free-space for example allowing basically free-form tele-presence. It would be harder for governments to attempt to tax remote workers, but they might try it anyway by passing the tax burden on to the employers -- forcing them to collect local taxes against remote workers. Crypto-anarchy has interface problems also, it just allows you to be a virtual remote worker because your location is no longer discernable. Still governments may try to force local companies to pass the tax burden on. India is an interesting example of remote workers -- many US companies are apparently moving jobs wholesale to India to try to reduce costs in the face of poor economy. Another corporate trend to avoid US taxation is where companies move their notional headquarters off-shore so that they are not taxed on international sales. Either way the fact that companies are doing this suggests that currently companies themselves are ahead of individuals in mobility to avoid taxation. This same principle should allow for example remote workers, or virtual remote workers to work for the notional off-short company. Virtual identities with documentation demonstrating domicile in Bahamas or other tax-havens should even allow a virtual worker to work for a company under government imposed obligations to employ virtual remote workers in the US. Adam On Sat, May 03, 2003 at 10:32:02AM -0700, Tim May wrote:
[...] These technological changes are obvious: metal-working, writing, weaponry, plumbing, the printing press, the steam engine, interchangeable parts, electrification, and all of the various technologies of the 20th century, including the telephone, television, birth control pills, and so on.
The printing press is one of my favorite examples, as it illustrates how the "triad" of technology, law, and culture (similar to Larry Lessig's triad...I think we developed these ideas independently, but I haven't chased down who wrote what first) is "tipped" by major changes. The Church and State, circa pre-Gutenberg, "owned" certain types of knowledge, blessed by the medieval guilds: silversmithing, leathermaking, etc. The royal patents were conferred based on kickbacks, tithing, family connections, etc. Those who violated the patents of the guilds faced various kinds of punishment, I suppose up to and including death. Sort of like the Mafia stopping independent producers of porn from producing movies (a friend in LA had this happen to him).
Now the "lawyers" of that age might have argued in courts (such as they were) that the power of the guilds should be broken, that greater economic prosperity would result from breaking the guilds.
But little changed.
Then came printing (movable type). While the first books printed were the obvious ones: hymnals, bibles, and other religious tracts, the printers began to print "how to" books. Not consciously "Toolmaking for Dummies" books, and not consciously "How to Undermine the Power of the State by Building Your Own Waterwheel," these books were nonetheless early how-to guides. Booklets on technology, on minerals, on all sorts of things a farmer might want to know. For the first time, knowing how to read was a useful skill.
Perhaps someone predicted the long-term implications of what this spread of knowledge would mean. (Maybe Nostradamus was influenced this way...I haven't looked for evidence.)
Someone trying to set a timetable for the sweeping changes would likely have not gotten it right.
As someone wise once said, we tend to overestimate the short-term consequences and underestimate the long-term consequences.
In the case of printing, the result over the following century or two was a rise in literacy rates (in the common languages, and this is when German, French, and English, for example, largely solidified into their current forms, viz. the Luther Bible, the King James Version, etc.). And the Protestant Reformation was built on printed words and on the people's ability to directly read the religious texts.
A technology undermined the state and the church.
This was repeated several more times, with samizdats undermining the power of the state in the USSR, with cassette tapes circulating in Shah-led Iran, with videotapes widely available even where banned in Islamic nations.
And e-mail, of course. E-mails to and from the dissidents in Beijing. Repeated around the world.
Strong crypto, of course, offers the opportunity for a complete bypassing of controls (more than just ciphers are needed, of course, as stego must be strong, as remailers must be compensated, and so on).
Will the effects be that corner grocery stores are converted into cryptoanarchist data havens? Of course not.
People will continue to buy and sell goods in their physical world, and this will continue to be a nexus of control and taxation. (Just as taxing land became more important after taxing knowledge, via the no longer all-powerful guilds, became less important. Land remained a nexus of control and taxation, as it does today. My property taxes attest to that, and will not be going down in my lifetime!)
So, what changes may happen? Will enough tax evasion happen via cryptoanarchy to make the people fed up and thus give rise to a "tipping point"? (As the Reformation arguably was, with enough people fed up with the selling of indulgences and having the ability to read the religious words themselves.)
And so on. I could ask about a dozen speculations of what might happen.
But the point is not to predict some withering away of the state. The point is that unfettered communication, with the already-extant ability to use all sorts of alternative financial instruments (offshore accounts, PayPal, E-gold, etc.), is already producing interesting changes in the way the world works.