Information and communication technologies are transformative. They change the way in which we see the world. They create new situations that are unfamiliar. The ways in which information moves at the speed of light, the number of people who have access, the ways in which value is added and so on, all mean that the ways in which we have seen the world are more and more becoming out of date. The mental maps used to determine “the ways things are” are, to an increasing degree, not in accord with the way things really are. Decisions made on the basis of the old mental maps can lead to inappropriate, dangerous or disastrous outcomes. We are in the process of inventing new mental maps so that as a society we are better able to deal with and benefit from a networked economy and society. This means a strong and comprehensive understanding that society is going through a major transition and that new governance mechanisms, at all levels, are necessary if we are to successfully manage the transition to the new networked economy.
Whose hands are on the helm and how did they get there. Where and how is governance taking place? Currently there are a host of hands on the helm, public and private. They got there because they were there at the outset, they have the power of the state behind them, they have the power of major banks or charge cards behind them and, of course, there are a host other actors who are filling a niche here and there. What is needed is some way of normalizing and making legitimate and predictable those whose hands are on the helm and putting in place accepted ways of succession to the helm. It goes without saying that the networked economy’s version of maps; routes and charts are all necessary.
The networked economy is “for real” and in time a variety of governance mechanisms will all come to pass and be put in place in much the same way as other major technological transformations were accommodated into the working of society. It will happen by some mix of public and private actors working together in the spirit of “enlightened self interest.” A practical and pragmatic approach, one that must have characterized the era which led to regularizing international postal routes, international air travel, international telecommunications, banking, the railroads and, of course the automobile.
Sustainable development is a national and international goal. Information and communications technologies are energy saving, capital saving and labor saving. It is these three factors are at the heart of and help to make the networked economy so valuable and productive This proposal acknowledges the importance of sustainable development and will continually seek to demonstrate ways in which is can easily be one of the outcomes of the networked economy.
Ideally new ways of governing will be developed in a thoughtful and deliberative way, with the intent to maximize benefits for all. Or new structures and ways of behaving can happen after some crisis has taken place, forcing officials to move quickly (viz., an earthquake leads to a tightening of building standards). Good governance anticipates a range of possible developments and puts in place ways of behaving before a crisis takes place. Here public policy is aimed at anticipating some of the possible, probable as well as some of the unintended consequences of governance challenges related to the new networked economy.
The networked economy is a shorthand expression, a way of describing an amalgam of new technologies and new ways of doing business. Much is in place. Much more needs to be done. It is, say, 1914 and the automobile is “for real.” Waiting to be developed and waiting too for ways in which development could take place was the following: car insurance, traffic police, fuel distribution systems and service stations, standardized ways of licensing drivers and automobiles, driver education, highway design and development, national road systems, the notion of access to individual dwellings (driveways and curb cuts).
Waiting to be developed in the networked economy are ways of identifying those who are active on the information highway. Do we need a licensing or identification system to better govern the traffic flows and provide sanctions for those who commit crimes, of whatever sort. Will yesterday’s laws apply/be enforceable tomorrow?
What about intellectual property and the downloading of software in whatever form: music, graphics or video. Or is the notion of intellectual property “yesterday’s story” in the networked economy? Intellectual property law, which includes patents and copyrights, is the fastest growing segment among American Bar Association members. Last year, it grew 9 percent to occupy 19,000 lawyers. Is this a “good thing or a bad thing?” Will the technology make information so easy to download and share that new pricing and compensation mechanisms will be needed if we are to compensate those who create such software.
Economics can be defined as the allocation of scarce resources among competing uses. Scarcity is key. In the hardware economy, if person A has a ton of steel, then person B can’t have access at the same time. The same holds true for a bushel of wheat or copper, or rail cars, etc. In the software economy person A can have a piece of software (program, music, movie, video game, etc) AND person B can also have the very same product. Both can use and enjoy the product. Hence the term, “information wants to be shared.” What happens to scarcity in the new paradigm? Scarcity has to be enforced. It is not inherent in the non-sharability which is a function of an economy based on tangibles. The ability to copy and reproduce the very same product and the existence of global networks where information moves in an instant fundamentally changes the world of economics.
The development of increasingly sophisticated networks has made it far easier for criminals to operate anywhere in the world. The growth of complex transactions via the Net provide more and more opportunities for international cyber crime which seems to be on an ever-increasing growth trajectory. Interpol has a long and distinguished reputation. In 1998 it celebrated 75 years of international police cooperation. Can it meet the challenges of the networked economy or need there be created a specific global police instrument to challenge crime and criminal activities in the networked economy
Cyber-traffic enforcement and catching criminals in cyberspace will become increasingly important. Some of the numbers associated with network-related fraud indicate that we had better be fully prepared for a fully networked economy. To take one example, Canada last year saw $4 billion in telemarketing fraud; more than $3 billion from stock market fraud; $650 million from cellular phone fraud; $127 million from credit card fraud. The old days of a culture of trust based on seeing colleagues on a day-to-day basis is no more; with global networks the tendency to take at the expense of others is heightened since the crime is often seen as “victimless.”
But to what extent does enforcement abridge privacy? Consider the recent controversy over the US FBI’s system of Internet “wire-tap” code-named Carnivore. It is a personal computer designed to act as a “wire-tap” by sifting through all messages going through a particular ISP. Although used in less than 100 cases, the broadness of the search and the fact that is resides on the location of the ISP (with an FBI agent changing the hard disk daily) raises questions of whether this particular form of wire tap is too broad, sort of a “fishing expedition.” Answers the FBI, not at all. There is nothing malicious or mysterious about the new device. “This is an effort on the FBI’s part to keep pace with changes in technology–to maintain our ability” to lawfully intercept everything as long as there is court authorization.
The list of topics where governance is at issue might broadly include: network privacy, security, public space on networks, impact of networks on community, taxation of e-commerce (locally and globally), crime, pornography, network integrity, enhancing the infrastructure, domain names, accountability and enforcement of commercial transactions, authentication, etc. Because the networked economy is integrative and comprehensive, the list of areas where governance faces new challenge can be very long, as we can see below
Managing the transition. Questions and concerns surrounding governance in the new networked economy
In the transition to the new networked economy, where and how does governance take place in the following areas: