The Official Story of the 21st Century: Life, Labor, Networks, and Capital

In this post I will paint a picture of how I see the world changing in the 21st century. Reputation will play a key role here. It is a bit utopian, for which I make no apology.

To give you a glimpse of my thoughts, consider this: the most valuable thing a five-star Uber driver has is not her car: it is her star rating.  A high rating on Uber is not just a reflection of her skills as a driver – it means she is attentive to the needs and wishes of the people she’s driving.  When self driving cars replace human drivers – and they will – that Uber driver will be out of luck unless she can take her star rating with her.   If you’re given the choice between hiring two people to clean your apartment, and one of them has a five star rating on uber after thousands of rides – would you trust her more than a stranger about whom you know nothing?

I’ll present this change in terms of ‘The OId Official Story’ – the way things were but are no longer, and ‘The New Official Story’ – the way things could be.

The Old Official Story

First you go to grade school, then you go to high school, then you go to college, then you get a job, then you get married, then you buy a house, have kids, and then help them repeat the process.  You’ll stay in one career your whole life, maybe changing from one company to another to get more pay or benefits. Health care comes from insurance provided by your employer. The employer will have you do something you don’t really care too much for, and in exchange you’ll get paid. Employers are big, stable, and safe.

School is paid for by the state. In school you will learn things and then quickly forget them once the test is over. You will be bored and wonder when any of the stuff you learn will ever matter. Most of it won’t matter in your adult life – but a tiny portion will be extremely important in your life as an adult, and it is very hard as a kid to know which is which.

When you’re at work, you should be boring. Your humanity is tangential to your role at work, if not an impediment. You are effectively a human acting as robot – do what you are told in this one precisely defined role. No need to think about alternatives or different plans.

You have friends as you grow up. Most of these friendships end slowly – you don’t have the time to keep in contact and distance makes things much harder. You may hold on to a few friends as you get older and have kids, but most people eventually become ‘contacts’, with whom you are friendly, but not close.

You live, work, and spend most of your life in a 50 mile radius. You drive a car you own to get almost anywhere you go, and finding parking is always a pain. While you are in a city, you’ll average about 1/4 the speed limit, door to door.  If you want to buy something, you drive to a retail outlet located within 7 miles of your house, which creates no goods itself, and exists to provide liquidity to consumers and manufacturers. You get information about the world by reading the newspaper or watching the local news. If you are particularly cultured, you read a national newspaper, or maybe magazines.

Only crazy people start companies, which usually fail.  When a person succeeds at the impossibly difficult task of starting a company, it is because they are a hero whose success is due to their genius, vision, and courage. You need a lot of money to start a company. Large amounts of money are rare and are extremely hard to get your hands on – this usually means borrowing from a bank and paying interest. The state limits who can run a business by requiring licensing and paperwork to start various kinds of businesses.

Politicians are mostly lawyers. They are good at speaking in platitudes. They avoid making discrete predictions, and spend a lot of time raising money. You vote for the major politician who tells you an official story that most closely lines up with your reality model. The politician spends most of their time trying to influence the decisions made by the state. The state exists primarily as an entity with a monopoly on the use of force, and occasionally as a provider of information.

The New Official Story

First you to go grade school so that you can learn how to socialize with other people.  After you turn 14 or so, it’s up to you whether you want to stay in school or explore the economy.  You’ll need a good reputation to do any kind of interesting work. You can use the state app to find short term gigs which don’t require a reputation. Once you’ve done a few short-term gigs and gotten a decent reputation for showing up on time, doing what you’re asked to do, and being courteous, you can secure a longer term job – possibly through the state app, but most likely through your social network.  For example, if you’re interested in software, you can start as a tester, until you gradually start writing code of your own.  If you’re interested in science, you’ll start cleaning test tubes and preparing experiments, until you eventually start doing analyses.

If you need structure in your life, the schooling system will provide it for as long as you want.  Schooling is paid for by the state. Students and teachers rate each other with the state app, so you can find teachers that work with your style of learning.  Teachers are paid based upon the long term reputation of their students, so your teacher will try to help you develop good life habits in general – the more you make, the better they do. Teachers exist in many places – most good companies try to hire teachers so they can train their work force, and there are plenty of freelance teachers who put out offers for services on the local apps. Often teachers find ways to break down unstructured tasks for a company into smaller, structured tasks where failure is an option.

As you get older, your social network grows. You keep in contact with people you met once at a party decades ago, because they post interesting things and you have common beliefs. You find joy in connecting two people on your network who can help each other, because your reputation’s integration score increases as you stitch together the graph around you.  Stitching your social graph together is the way you build your own safety net – by building connections between nodes on the graph around you, you ensure that you’ll always have support when you need it.

Running a business is something you’re almost expected to do when you get old enough. That expectation fits in the same category as having children – and they’re seen as largely similar. In both cases, you provide a less experienced person with a structured interface to the delightfully unstructured mess that is reality. There are legal interface providers that will do all the background work for you – as long as you’re just serving people you’ve known a long time, there’s very little risk. Once you start serving the general public, the state will often require you to get a license, which can be gotten through certification from anyone with a reputation score above a certain threshold. As with the teachers, they want to make sure you do well – you earn a bit of reputation from anyone you certify, and you lose out when they make mistakes.

Large amounts of money are relatively easy to come by, as long as you plan to build a company. You simply need a good enough reputation as both a laborer and a teacher, and then you’ll have access to capital, usually provided by a  mentor organization, which takes share of ownership in exchange for both profit and linkage to your reputation.  The state limits businesses only when they grow beyond a certain radius on the social graph – you can do hair and nails for your family and friends all you want, but once you start opening your house to strangers more than 1 hop on the graph away, the state requires more licensing.

If you want to buy something, you’ll use a 3D vision device to see it, and a haptic device to touch it. It’ll be delivered to your door by one of the many autonomous vehicles that fill the streets. When you are in a city, transportation is dirt cheap, and you travel the speed limit without stopping, from start to finish. Liquidity is still provided by specialized firms, but these operate on distributed autonomous market networks, which connect buyers and sellers based upon geography.

Politicians come from all walks of life. They are good at connecting people who can help each other. They occasionally make discrete predictions, which are all tracked for their accuracy on the reputation networks. You tend to delegate your power to people you know and trust, who delegate some of that power transitively.  Politicians spend most of their time trying to use their power to enrich and connect their networks.  The state exists primarily as a provider of information , and occasionally as the sole entity with a monopoly on the use of force.

Transitions

The key to making all of this work will be the introduction of a new category of employee. The old system – where you’re either a W-2 or a 1099 – that’s just not cutting it.  So many of the jobs created fall in this legal grey area. I don’t think anyone can say with a straight face that Uber hasn’t taken an industry that sucked and made it enjoyable, or that this would have been equally doable with W-2 employees.  Uber shouldn’t get blamed for our current legal system being too inflexible to accommodate an on-demand workforce. Reputation is a key driver here – Uber’s star rating system, or something like it, could form the basis for a 21st century way of finding and evaluating labor as well as jobs – employers would get rated openly, just like employees. Because self driving cars will be more efficient than people-driven cars, people will be able to work farther away. Imagine hourly workers being able to work at any of 10 McDonald’s  restaurants nearby – as long as they have a high enough reputation from McDonald’s corporate – the hourly workers get flexible schedules that adapt to their needs, and the businesses have a huge pool of labor to tap into and scale up as they need it. To get this going, we need a new legal framework, and ultimately a new social contract, for the 21st century.  Here’s hoping it’s a good one. Americans have always been capable of adapting to flexible situations, and i doubt this time around will be any different.

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