Posted by: antyx | September 8, 2008

The collapse of centralized systems


From the dawn of human civilization, the way we organize any complex social, economical or any other system has the greatest impact to our future development. There are many examples of centralized social systems which in their principle have not changed after many centuries. Monarchy as a form of governmental system was one of a great example of how some few self elected people managed to conserve their authority over other people for many centuries in numerous occasions. Historically societies tend to hand authorities to the few, which in most cases led to the halt on social and scientific development.

The biggest social change that occurred throughout history began in my home country, Greece. In a time period of 400years numerous of social, scientific and political changes occurred, challenging the old thoughts and preserved mentalities. The most profound change in the political system was through the introduction of democracy. A political system which in theory everyone as an Athenian citizen had the ability to decide over or against any decision made in his town/country. Contrary to old Monarchic and Oligarchic political systems, it decentralized the decision making into the whole spectrum of the Athenian citizens. Ancient Greece was also one of the first civilizations that introduced the modern scientific method. Reasoning and experimenting were common in scientific circles. The expansion of this way of thinking was done through introduction of educational systems and social forms that helped the further development of any promising mind.

I can find numerous of other historical examples where society managed to overcome the old way of thinking and foresee new structures in order to head into the future. An interesting era to watch this transformation occurring is today. Most of the nations on this planet have capitalistic economies, democratic governmental systems and the dynamics of any country is influenced by global changes in economy, diplomacy etc. Although at a first glance someone may speculate that our complex systems are decentralized, infact they are not. I have tried to distinguish some of modern societies main elements and examine where to what extent they are centralized or not.

Economy

Western Capitalistic Economies rely on the dynamics of the free market and the ability of any private person to buy, sell goods or services. The value of local Currencies and their availability in a country are regulated in each countries central bank. Banks in general play the role of the money agents where they have the ability to buy and lend money for private interests. Someone may speculate that Western Capitalism as an economic system is fully decentralized because it mostly depends on the dynamics of the free market, it is strictly regulated by financial entities, the central banks, feds etc, where the structure of them can be visualized into a pyramid of regulators. Many economic elements in societies like inflation, unemployment, interest rates, value of money in order to lend, the cost of energy (oil) are strictly regulated by a group of banking and financial entities. Though capitalism may appear as a decentralized and a dynamic system, it is highly regulated and centralized. Before the introduction of banks money was invented as a practical way to represent the value of goods and services. Because of practical reasons a centralized authority regulated the printing and flow. I dare to be reluctant in stating the above because i have no economic educational background.

Modern applications semi-decentralized economic technologies is internet banking, paypal where they manage to directly provide their financial services at a fraction of the original cost. Electronic economy is becoming global, faster and far more accessible to end consumers. Paypal for instance, n internet payment financial entity has managed to form a highly effective e-money system, which has started to widespread almost everywhere. Offourse it is still centralized though it manages to overcome the dependence of local banks and regulators.
Zopa, an emerging concept, involves social lending (p2p lending), where lending and borrowing money can be done from person to person through the internet. Borrowing money through this service becomes far more decentralized and personal, with also an amazing low borrowing rate. Numerous other internet financial services exist which manage to redefine old concepts.

Government/Political Systems

Throughout history though many thinkers managed to challenge the old and introduce new economic and political systems. Communism, a political system introduced in the start of the 20th century, in theory tried to hand the proletarian (the people) all the production and economic shares. In practice though to my view it led to become another oligarchic political system, having in many cases the same mentality as fascism. China today, and Stalin’s Russia were some examples of these practices. Today most agree that communism was a failed and declined political system that belongs to the past. US capitalism on the other side managed to contradict the above political system. It mainly relies on the dynamics of the capitalistic economy, it’s growth, consumer spending etc. It manages to achieve a freedom on private investments and generally a freedom of movements when private financial interests are involved. Today most countries have capitalistic economies which vary from place to place and have some form of democratic political system. Democracy as we know it today is one of the most widespread political systems. Unfortunately as many other concepts, in practice it has nothing to do with its original definition. In ancient Greece where is was first conceived and practiced it had to do about handing out the decicion making to the many. Today democracy invloves a complex electing and respensentative system where throuhg political parties accoring to their political plan and ideology are elected to form a goverment and alltogether are involved in voting for or against new govermental laws. With this way modern democracy is practices it virtualy confines the citizens into just electing a political party amongst few. They are confined just to decide every 4 years, virtually keeping them out of the decision making process. Offcourse in a democratic country there are many ways of being politcical active through various non-profit organisations, political activism, strikes, public referendums and many more. Democracy today is by principle centralized and confined to the few elected. Offource the constution defines in which way authority and dicision making is practiced. Decantralizing this system in every level is still a utopia. Public referendums are avoided mainly for political reasons, making them almost unexistent in people’s minds as a form of deciding about a crusial political issue. Redifing and reforming a more decantralized system is feasable with the use of technology, public awareness and acting local though this process cannot only be done through the redifinition of concepts in the constution. Offcourse the only one with the authority of doing so are the pre-elected representaives who by no means want anything to do with redifing their place in the pyramid of authority and handing it out to the many.

Information/Education/Software

Information, as strange as it may sound was the reason we evolved into human species today, through the evolution of our genome, the DNA. In social terms the distribution and spreading of information, initially through speech led to the advancement and increase of complexity of out local societies. The biggest boost of that everlasting process was done through the introduction of typography, books and modern educational systems. A new medium which was initially developed in the cold war era, was introduced commercially in the early 90’s. This medium is no other than the internet. Initially poor in content, it managed to evolve in a huge scale, and has become today the most dynamic, complex and well structured information sphere. Contrary to other preexisting mediums as the radio/tv etc it differs to the extent of user interaction. Information does not flow vertically, from the few that own a tv/radio station, but horizontally from the end users to each other. The web technologies and structures of this network led to the building of amazing services and knowledge databases like wikipedia, youtube and numerous special interest communities like forums, message boards and wiki’s. Offcourse no one could have predicted all the above. Some may say that the internet is a form of applied democracy, where each one can interact, change and form this new structure. To my view though the internet as a network/technology/medium is still in it’s early infancy though. The rate of it’s growth in size, complexity and userbase is surely profound and will start to impact everyday society/economy/politics/distribution systems worldwide. Offcourse everything we adopt should be done after some extensive reasoning. This dynamic and interactive structure of this network has surely started to impact the way software is produced and distributed. Open source software is a great example of this transform, where following an revolutionary philosophy, it practically managed to provide free software, as in freedom and price, through a decentralized manner. Unfortunately open source software has many obstacles to overcome, in order to become widely adopted. Nevertheless it is a great sign of how the introduction of a new way of thinking combined with the use of the internet started to challenge the old and had a positive impact on society itself. An observer could easily notice that through the wide adoption of the internet, it’s really hard to force the use of centralized techniques. The end user, to a different extent each time, has realized that the spreading, growth and evolution of this new medium, depends on his freedom and ability to fully interact with it, contrary to old centralized mediums. To me though the internet as i mentioned above is in it’s early infancy, not because web technologies are inefficient or underdeveloped, but because it has only just started to impact social forms and structures. Electronic democracy is still a utopia, although the technology fully exists. That is because politicians on the one side cannot imagine loosing any of their decision making authorities and handing them virtually to the whole spectrum of society.There is also almost no realization of this need and feasibility from the part of society. To me the progress of human civilization can by no way be achieved through progressing technology and science alone. The true progress occurs in society itself, on our ability to self- realize, reason, interact, cooporate and overcome old and preserved mentalities with the use of education, self knowing , technology and extensive reasoning.

Energy & Transportation

Energy distribution today unfortunately is one of the most centralized systems. Oil, gas, electricity is distributed and produced by a few corporate and government entities. Ofcourse this centralized system could not have been created by mistake. Some few, early realized that energy would be the main element of the 20th century society, so electric cars were never produced in a mass scale and fossil fuel was presented as the only way of gaining portable and efficient energy. This centralized system played a crucial role in the evolution of modern economy and industry. Not recently enough though, a side effect of all this was the destabilization of the global climate from the CO2 emission on a massive scale. The environmental hazards were realized decades ago, though industrialists and economists which influence global politics managed to persuade us of for the opposite. The environmental damage caused was named as science fiction, rumors, urban myths etc. The 1st sign of political realization of the hazards we faced from the existing energy distribution system occurred in Kyoto, with the signing of the well known Kyoto protocol. It was an ambitious atempt to radicaly change in the way we produce energy. Offourse the lobbyists were not persuaded once again, so it was almost neglected by the US government, the biggest CO2 emitter globally. Though in 2008 things have changed, realization of this environmental problem has started to spread and at last numerous political and technological practices have started to focus on the environmental problem. Eco friendly technologies and techniques though seem to be in most cases decentralized. With the present state of environmental technologies it is feasible for a home and car owner to be energy sufficient. Efficient solar and wind installations, electric plugin vehicles manage make this fully feasible. The electricity grid network has started to become more decentralized and horizontal. Offourse it is very early to say that the above are reality. Peer to peer energy networks may appear soon enough, mimicking the structure of the internet itself. To achieve this transformation it mainly depends on political will, where through new laws and regulations, monopolized energy markets will be forced to become open and horizontal. Environmental technology itself has progressed to a promising level, though to fully build a decentralized energy distribution network, energy efficiency must be the 1st aim. Ironically i predict that this transformation will occur mainly by need, because environmental hazards have become everyday reality. Achieving a decentralized energy distribution system is a very big task, that requires political will, realization from the civilians of this need, mass adoption of renewable energy technologies and long term investment on them. For once again change will be the key element to maintain and sustain our balance in energy demand and supply, where fortunate enough this decentralized model can only use renewable energy sources and technologies.

Products & Goods Supply

Historically the supply of goods was mostly done between small scale producers (vegetables, meat, clothes, goods etc). Societies used to be far more less demanding on specialized goods and products so they were more over selfsuffient on a community scale. Offourse human needs progressed so did the distribution and production system. It became more complex an global, leading to the global economy. Nowadays prices on basic food commodities like wheat, corn and sugar are somehow regulated by various economic entities. 3rd world countries which do not have direct access to these basic food sources have to bare this increase on food prices. Biofuels appear to be one of many reason of this price increase, though they probably are just the transitional tool to overcome our dependence in fossil fuel. In a local level food prices are most of the times regulated by the supply and demand from the producer himself and the buyer. Offourse when intermediate suppliers intervene with the food distribution, food prices are mostly regulated by them. That is mostly seen in large urban areas where it is not possible for the producer himself to directly sell his goods to the whole spectrum of the population. Local markets though seem to achieve this peer to peer selling system, where prices are mostly regulated by supply and demand. Intermediate suppliers are in most cases the ones that are responsible for high prices. Also a basic factor on price formation is the cost of producing goods. Water, machinery, loans, pesticides etc manage to affect the final price to a big extent.

An emerging distribution system on suplier consumer products are internet shops. Amazon, ebay are just some examples of this trend. Sellers who directly buy in bulk from product manufactures themselfes, manage to sell directly through the internet in amazing low prices. The same product in ebay for instance may sometimes cost a 1/4 of the cost compared to local markets. Offcourse this happens because intermediates, tax, customs and general selling costs are eliminated. This new distribution system is something fairly new, though is most of the times confined to products that can be easily sent through postage. Nevertheless it manages to challenge the old distribution systems, paving the way for new applications and decentralized distribution networks. Peer to peer product selling is much more feasible through the internet, where the end consumer benefits from the low cost.

Emerging decentralized technologies and networks

Offourse it is mostly up to us to rethink and challenge the old, where with reorganisment and existing technology we can redifine and decentralize  existing centralized systems. TV and wireless networking are some ideas i have expanded in some other blog articles, which unfortunately are still in a conceptual stage. My main impulse when dealing with this mind provoking concept is to make everyone realise that he/she has the ability to change and interact with any given system around him. Offourse this has to do mainly with the manner each system is constructed. The internet is a very good example of such system, but it is really important for this philosphy to be implemented and practiced in every level of society, so we could say that we are progressing as a whole and not just recycling old concepts and techniques.

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