4891: Orwell Had It Backwards

Thanks to George Orwell's Nineteen Eighty Four, and the film adaptation, most of us over 20 have grown up with the threat of an omniscient, totalitarian Big Brother looming over us.

While this is a tragic reality for the residents of a few countries, for most it is not.

Yet many of us are obsessed with our own privacy, imagining it as a defence to control by organised crime lords, governments, a "New World Order" or Facebook. Others relish the illusory voyeurism in the melodramatic Big Brother television series, and the phoney 'privacy battles' conducted between celebrities and the tabloid media by agents and public relations advisors for commercial gain.

But it is actually the overwhelming dislosure of information about ourselves that defies control by any single institution (as does the inherent unpredictability of human behaviour). The Chinese government, in particular, seems to understand this. Sharing our preferences, desires, fears and concerns (if not our birth dates and passwords) via social, retail, political and other facilitators enables us to gain greater personal control of our own lives. That process results in services adapted to our own actual or desired behaviour rather than a service provider's bottom line or a political party's dogmatic manifesto. There are literally millions of examples of this dynamic at work. But consider how:

• The UK recently opted for a coalition government amidst scaremongering by 'big media' and the major political parties.
• Newspapers complain about our 'promiscuity' when it comes to their content, and our refusal to pay for that content online.
• Sharing more personal data often results in better markets, e.g. in consumer credit.
Our networks are always changing, both within platforms and between platforms - we create new networks and still newer ones, and leave old networks very quickly.

Of course, George Orwell was writing a cautionary tale rather than necessarily predicting the future, so we at least have him to thank for a vivid image of how society must not be allowed to develop. In the meantime, we should go on sharing information about ourselves, even if only as a last defence to totalitarian control.

Image from Online Social Networking

Wall Game Yields Coalition Agreement

At last we have a new government and a Coalition Agreement, and a new cabinet. Are they listening? So far, so good. Here's a summary from the BBC:

• There will be a "significant acceleration" of efforts to reduce the budget deficit - including £6bn of spending reductions this year. An emergency Budget will take place within 50 days
• Plans for five-year, fixed-term parliaments, meaning the next election would not take place until May 2015.
• Proposals for a "wholly or mainly elected" House of Lords on the basis of proportional representation will be brought forward
• The Lib Dems have agreed to drop plans for a "mansion tax" on properties costing more than £2m, while the Conservatives have agreed to shelve their plans to raise the inheritance tax threshold
• Instead there will be a "substantial increase" in the personal tax allowance from April 2011, with further steps to raise it to £10,000 as a "longer term objective".
• The Lib Dem policy of taxing planes, rather than passengers, has been adopted and there is a commitment to a new tax or levy on banks as well as a pledge of "robus action to tackle unacceptable bonuses in the financial services sector".
• The new administration will scrap part of Labour's planned rise in National Insurance
• A pledge to have a referendum on any further transfer of powers to the EU and a commitment from the Lib Dems not to adopt the euro for the lifetime of the next Parliament
• The Lib Dems have agreed to Tory proposals for a cap on non-EU migration
• The Conservatives will recognise marriage in the tax system, but Lib Dems will abstain in Commons vote
• The Lib Dems will drop opposition to a replacement for Britain's Trident nuclear missiles but the programme will be scrutinised for value for money
• There will be a referendum on moving to the Alternative Vote system and
• Enhanced "pupil premium" for deprived children as Lib Dems demanded"

And from the fine print:

1. Child Trust Funds and tax credits will be reduced for higher earners.

2. Committment to spending 0.7% of gross national income on foreign aid.

3. Demonstrating a committment to low cost government, there will be a review of long term affordability of public sector pensions (protecting accrued rights - which will make public sector pensions even less affordable in the long term...).

4. Non-business capital gains to be taxed "at rates similar or close to those applied to income."

5. Banking levy and action on unacceptable bonuses.

6. Plans to "foster diversity, promote mutuals and create a more competitive banking industry," including a year long review of separating retail and investment banking.

7. A possible loan guarantee scheme for SMEs.

8. Bank of England to control prudential regulation (is this really the end of the FSA?)

9. Allowing 10% of an MP's constituents to force a by-election where that MP is found to have engaged in "serious wrongdoing".

10. A statutory register of lobbyists and the removal of 'big money' from politics

11. "Radical" devolution of power and greater financial autonomy to local government and 'community groups'.

12. A retirement age (yeah, right - we'll never retire) of 66 from 2016 for men and 2020 for women.

13. An end to the requirement to purchase a pension annuity at 75.

14. The end of multiple 'welfare to work' programmes in favour of one.

15. New providers can enter the state school system in response to parental demand.

16. A 'referendum lock' on transfer of further powers to the EC.

17. The end of: national ID cards, national ID register, biometric passports and the Contact Point Database.

18. Extending the scope of Freedom of Information Act to increase transparency.

19. A review of libel laws 'to protect freedom of speech'.

20. Safeguards against the misuse of anti-terrorist legislation.

21. Further regulation of CCTV - does this mean curbs on the use of images?

22. An end to the storage of internet and email records 'without good reason'.

23. A smart grid and smart meters.

24. Feed-in tariffs for electricity.

25. A 'huge increase in energy from waste through anaerobic digestion' - which sounds very painful indeed.

26. A green (greed?) investment bank.

27. Any new coal-fired power stations will need carbon capture and storage (CCS) to meet emissions performance standard.

28. A high speed rail network.

29. No third runway at Heathrow, and no extra runways for Gatwick or Stansted.

30. A recharging network for electric/hybrid vehicles.

31. A commission will consider the West Lothian question (the paradox that Scotland, Wales and Northern Ireland have their own assemblies, while England does not).

Moral Panic #101: Deficit Leaves No Time For Electoral Reform

Having limped in first over the electoral finishing line, and needing support to govern, the Tories have been understandably meek in setting an agenda for this Parliament. And after decades of dodging the issue, they are truly appalled at the thought of electoral reform as the price for Liberal Democrat support.

But commit to it they must: it's a travesty that 23% of the national vote could produce only 9% of the MPs. And it is small consolation to the people who comprise that 23% (not to mention the 29% who voted Labour and the 11.9% dismissed as voting 'other') - that 'their' 57 MPs hold the 'balance of power'.

The general election would have been more engaging and vastly more inclusive if the 63.9% of voters who did not receive their first choice could have nominated the candidate they'd have preferred to win instead. That's what Proportional Representation is all about.

Despite moral panic designed to dodge the issue yet again, electoral reform will not 'distract' anyone from cutting the £163bn public deficit. All are agreed that economic reform will be business as usual for this government. In fact, as a result, it should be 'less busy than usual'. So there'll be plenty of time to work out the move to one style or other of Proportional Representation.

Commitment to electoral reform might even lead the unlucky 63.9% to work much more willingly with the lucky 36.1% to cut the budget deficit.

Image from VoterPower

We Have MPs Where We Want Them

In many ways the UK general election has not gone the way anyone wanted.

Sure, we have a hung Parliament, 149 MPs from the last scandal-ridden pit did not stand, Jacqui Smith lost her seat, and the BNP didn't get any at all.

Yet the politicians and their party machines have not been able to control the result. And, while voter turn-out increased slightly, voters were angry at being turned away as polls closed and already a campaign has begun to "take back Parliament" by reforming an electoral system that nullifies vast numbers of votes.

So one thing seems assured: this Parliament is in for a bumpy ride.

And this is a great outcome. We have MPs exactly where we want them. They are not in control. They have little alternative but to listen and respond to our issues bottom-up.

Independent forums like Power 2010, 38 Degrees, and TheyWorkForYou, are genuine attempts to gather and share everyone's views without regard for 'party lines'. The politicians would do well to engage with them instead of relying on their own party 'research' to validate policies they want to impose from the top down.

But we too need to participate by sharing our concerns: we'll only get the government we deserve.

Image from The Original Hog Roast Company

Australia Bans Lawful Sales of Cigarettes

Australia is to phase out lawful retailing of cigarettes from 2015, starting with a ban on corporate logos on packaging in 2012.

"The new branding for cigarettes will be the most hardline regime in the world and cigarette companies will hate it," the prime minister, Kevin Rudd, is quoted as saying in the Guardian:

""Introducing plain packaging just takes away the ability of a consumer to identify our brand from another brand and that's of value to us," an Imperial Tobacco Australia spokeswoman, Cathie Keogh, told ABC radio, adding that the company planned to take legal action."

A leading expert in non-brand retailing, who declined to be named, welcomed the move. "We've been working with government agencies for many years now on ways to improve the distribution and marketing of non-branded products, and this is a great endorsement of our efforts," he said, during a brief exchange of gunfire with a colleague.

The value of shares in private security firms also received a boost, as A$215bn was added to the value of the sector in same day trading on the Australian Stock Exchange.

When Top-Down Meets Bottom-Up

Gordon Brown's exchanges with a woman from Rochdale today are emblematic of both the decline in faith in our institutions and the root cause.

While speaking with Ms Duffy, the Prime Minister focused entirely on making his own political points rather than listening to her issues, rationally expressed, including a parting compliment on local education. And his annoyed, off-camera reaction to her persistent attempts to get a word in edgewise was to mistakenly dismiss both her and her genuine concerns as "bigoted".

Ms Duffy's personal reaction to the Prime Minister's comment was "disgusted" and "upset". "They have no idea how we're living in this country," she said.

Already, the vicious cycle of public reaction has begun, taking the government, politics and politicians with it.

Photo from Plugin.com

Hung Parliament - More Pressure?

Many people would like to have rolled out the tumbrils for the UK Parliament in the past year, but a 'hung' Parliament is of course something quite different. And 38 Degrees is rightly running a poll to see if people want to hear more about the pro's instead of being heckled by The Sun and other mainstream media about the con's. I've said that I do.

Esentially, a hung parliament exists where no political party has a majority of seats. So either several parties agree a coalition and form a majority government, or a single party must form a minority government and horse-trade with the others on key issues. If neither works on critical issues, like budget approval, there would need to be another election.

The BBC has tried to explain it, but gets mired in speculation about numbers. A short Wikipedia entry has just been created. It links to the BBC explanation and a Q&A by the Institute for Government, an apparently politically neutral think-tank, which is also concerned about the unduly negative portrayal of hung parliaments in the media:

This has been reported quite negatively and has generated predictions that unstable and ineffective government would be the result.

However, as argued in 'Making Minority Government Work' by the Institute for Government and Constitution Unit, this need not be the case. Indeed, minority or coalition government can even have advantages, though ministers, the opposition, the civil service and the media would all have to adapt their behaviour to make it work.

This sounds promising. Basically, all politicians would have to behave much more reasonably and responsibly to try and forge consensus, and the media would have to refrain from senselessly branding the process as unstable and chaotic. After all, the democratic process should be messy rather than engineered from the top down in a nice orderly fashion. A dynamic, open system which encourages broad engagement by all stakeholders cannot realistically appear neat and linear.

I suspect that the biggest driver of the negative airplay - particularly at The Sun - is that Gordon Brown would remain PM, and would be the first to be invited to try and form a government. Given his record for clinging desperately to power to date, one does wonder whether we'd ever be rid of him.

However, while the fear and loathing of Swinegate has exposed Parliament to more public scrutiny and produced a little more accountability, it seems we have a long way to go in educating the politicians that citizens come first. And a hung Parliament seems a great way of keeping the pressure on.

All Washed-Up, Ready To Go

The despicably secretive, double-dealing frenzy of the UK Parliamentary 'wash-up' is an especially disgraceful and cretinous process in the hands of the current shameful, scandal-ridden crew. That they went ahead and wallowed in it shows they've learned absolutely nothing about how to rescue their institution from the desperately low esteem in which it is held. As they huddled in their dirty little corners to snuffle out a deal, few spared a thought for the millions of individuals who put them there or the mandate they were granted. Parliamentary reforms were ditched as they cosied up to the copyright moguls and helped themselves to the tools of leak suppression.

We can only hope that this insidious wash-up process and the tawdry deals it produced will adorn the funeral pyre of this miserable, tragic saga in global political history.

"Ye are grown intolerably odious to the whole nation . . . In the name of God, go".

Oliver Cromwell, 1653.

Kool Aid!! More Kool Aid!!!

The UK election battle is raging. From the plains of Helmand Province to the door of Number 10, where Gordo clings to power like a crazed gibbon hugging a tree. He'll have to be carried out of there, gibbering and drooling in a locked cage, if Dave and that other guy are going to get him out at all.

It's hot and dangerous work. New Labour goons roam the surrounding streets in ugly bands, some desperate to get their hands on  private loot  to fill the empty public coffers, others offering themselves for hire like cheap mercenaries. While deep down in the bunker, amidst the clamour and roar of media briefings, timeshare-style cold-calling, billboard banter and sound-bite skirmishes, staffers scream "Kool Aid!! We need more Kool Aid"!!! Dreading that without opiate, they and the masses will stop believing.

It would be time to flee, if the unions hadn't seized control of the roads, railways and the airways. So we're stuck in the battle zone, cowering behind any solid object we can find, rags stuffed in our ears against the hideous din. Only the insane and the very brave will risk the lethal dash to the polling booth.

On May 7, we'll know how those numbers stack up.

Green or Greed Investment Bank?

I wonder whose problem(s) would be solved by the public sector 'green investment bank' being touted by both the Tories and Labour. 

I mean, do you believe the British Private Equity and Venture Capital Association is a staunch advocate of completely open and transparent financial markets? Or do you think it could be helpful to have a captive investor on which to off-load one's less than spectacular speculative green investments as a last resort?

Perhaps more importantly, would the creation of a public sector green investment bank allow or encourage individuals to buy-in to alternative energy projects, financing them in the process?

The current "problems" in the financial services markets - excessive fees and bonuses, lack of transparency, poorly understood products, the credit and pension crises - are the result of the sort of institutional tinkering epitomised by the proposed 'green investment bank'. We funnel investment opportunities and funding into a zone in which relatively few firms are permitted to operate. The results are increasingly complex products, less transparency, increasingly concentrated risk and less competition.

This situation won't change until the clear objective of the regulatory regime becomes the delivery of simple, low cost financial products that are accessible to us all. Rather than vainly trying to educate an aging population to become more and more financially literate, we need to vastly simplify the process for the average individual to invest/save in a fully diversified way.

Surely the successful investment firms of the future will be the ones who race each other to demystify and simplify the funding/investment experience, rather than those who enter into cosy, self-serving institutional arrangements like this one.

Gordon: Retail Bankers' Hero To The End

Funny that Gordon Brown has chosen the last possible minute before his last ditch General Election to announce that UK banks will finally allow credit cardholders to repay their highest rate charges first - especially when President Obama let this cat out of the bag in May 2009.

When finally implemented, this long overdue requirement will apparently save UK cardholders up to £500 million a year. So it's far less amusing that Gordon Brown appears to have been rather passive on the issue of excessive bank overdraft charges, worth £2.6bn a year. The 20% of overdraft customers with a claim have had to wait years while the Office of Fair Trading has fumbled around in the courts at taxpayers' expense before meekly announcing a 'wait and see' approach to the problem earlier today. No last minute offer of regulation from Gordon there.

Of course, the end of 'negative payment hierarchy' on credit cards is an affordable goodwill gesture for banks. They aren't really in the business of lending money anyway, as the Bank of England found in its February Trends in Lending Report. They're in the business of hoarding it to 'repair their balance sheets' (which largely seems to involve paying bonuses and lobbying for regulatory restraint). By the same token, however, now is not a good time to lose billions in overdraft fee income, regardless of the fact that cash-strapped customers need it more, or that it's a rounding error on the bailout costs to date.

In other words, Gordon Brown is not really committed to ensuring fairness, even when there's a General Election on the line.

The Great Aussie Firewall - The Game

The Guardian reports on the latest response to the Australian government's efforts to control the internet.

Fool's Gold, Fool's Paradise

I've literally just finished Gillian Tett's Fool's Gold, an insightful, frank and highly readable account of the credit crunch, explained from the standpoint of the JP Morgan staff who somewhat unwittingly unleashed the Bistro-style CDS derivative into an environment of such stunning irrational exhuberance, greed, negligence, recklessness and downright fraud that it's left even the insiders angered and aghast.

And it ain't over yet. While subprime default estimates continue to be revised upwards, bankers brazenly continue to repackage downgraded debt into yet more CDO's backed by leveraged loans.

Importantly, Gillian Tett's narrative tellingly confirms a string of cultural problems that we're told again and again abound in the capital markets trading "pit": regulators whose remit and resources prevent them seeing the financial world holistically, a commission/bonus-driven sales mentality that often ignores the limits of the hallowed Gaussian 'models', banking groups that merely comprise dysfunctional silos, the cosy social contract banks enjoy with government. It's little wonder that everyone lost sight of the big picture - and that our faith in these institutions is utterly shattered.

Yet none of these factors is about to change. Amidst all the talk and shuffling of deckchairs little is actually being done to avoid or minimise exposure to Black Swan events. Hedge funds scramble to avoid the sunlight, like the swaps world did previously, and the quest for transparency has degenerated into protectionist farce. With an election still a long way off, competing government and opposition plans for the financial sector realistically mean regulatory paralysis throughout the time when structural and cultural reform would have been most achievable.

We're living in a fool's paradise. Enjoy.

Web Filters To Block All Australian Content

The United Nations Safe Internet Committee (UNSIC) announced on Thursday that its web filters would no longer accept any Australian content. A spokesman explained: "The Australian government warned us that it has lost control of Internet content, and we should not accept any further Internet content from its servers until the problem is resolved."

When asked for the Australian government's response to those who believed in an open, neutral Internet, the UNSIC spokesman added, "Talk to the hand".

Posted via email from Pragmatist's Posterous

Digital Britain

I should start my take on the "Digital Britain report" by making one thing clear: the fact that the government has issued the report is itself a Good Thing. The government does have a role to play in fostering and facilitating the growth of the digital world.

In that respect, the most important message in the whole document is this:

"We are at a tipping point in relation to the online world. It is moving from conferring advantage on those who are in it to conferring active disadvantage on those who are without, whether in children’s homework access to keep up with their peers, to offers and discounts, lower utility bills, access to information and access to public services. Despite that increasing disadvantage there are several obstacles facing those that are off-line: availability, affordability, capability and relevance."

However, the terrible news is that the detail of the report is merely a cascade of top-down recommendations to institutional problems, rather than a genuine attempt to clear the obstacles to every one of us seizing control of our dealings with government, banks, utilities, broadcasters and others.

Take the word "relevance" in the above quote, and consider the following passage that Technollama has extracted:

“The popularity of X-Factor and Britain’s Got Talent shows the enduring drawing power of content-creating talent that few people possess. The digital world allows more of that talent to find its way to more consumers and admirers than ever before. But it is not wholly democratic: some have the talent to create content; many others do not. As throughout history, there need to be workable mechanisms to ensure that content-creators are rewarded for their talent and endeavour. And the need for investor confidence is key. User generated videos can be hugely popular, but there remains a healthy appetite for big movies costing many millions to produce.”

It's a sad reflection on the government's understanding of digital Britain, that "X-Factor" and "Britain's Got Talent" are not only seen as "relevant", but also epitomise Britain's "content-creating talent". It is deeply insidious for the government to claim that the digital world is "not wholly democratic". This is view of the online world is simply false. The digital world is much, much more important, relevant and creative than is suggested, and hugely democratic - much more so than this government would like. Television and user-generated video platforms are merely a part of a co-operative mix of many different types of web site that are increasingly inter-linked and intertwined, enabling access to a huge range of content in different formats from different people at different times on different platforms and networks, depending on where people are and what they're doing. "X-Factor" is just one pixel on a much larger screen.

So let's not allow a few television shows to be the Trojan horse for a bunch of protectionist measures for Britain's beleaguered entertainment institutions.

Just because television has "gone digital", does not mean that TV content is a proxy or yardstick for all digital content. Similarly, the fact that a few record companies have made uncorroborated guesses that they'll make £1bn less in CD sales over the next 5 years, must not colour our view of file-sharing or distract us from understanding the value of Net Neutrality. Their digital music sales increased by 28% in 2007, after all. And they aren't the only people relying on the digital media to release music. Furthermore, several studies on the impact of file-sharing appear to negate the assertion that file-sharing adversely affects creativity.

It is great that the government has demonstrated a willingness to foster the growth of digital Britain. But it is also extremely disappointing that the "vision" is for us all to be glued to a screen watching wannabes singing other people's songs.

FYI, I've extracted the government's proposed "Actions" below, and may comment in more detail on some of them later:

• The Government will look to Ofcom to formalise the Consortium of Stakeholders to drive a new National Plan for Digital Participation.


• The Government will ask the Consumer Expert Group to consult and report on the specific issues confronting people with disabilities’ use of the Internet in Digital Britain.


• The Government will write to the Channel 4 Board asking it how it can further contribute to driving Digital Participation.


• In order to ensure the delivery of the Universal Service Commitment, we will establish a delivery body – the Network Design and Procurement Group – at arm’s length from central Government.


• The Caio Report recommended relaxation of regulations on the installation of overhead lines to lower deployment costs.The Government proposes to launch a consultation, by Summer 2009, on the impact of any amendment to the Code governing this.


• The Government intends to consult on the proposal for a general supplement on all fixed copper lines for a Next Generation Fund.


• The Government will have an independently produced guiding technical arbitration on the timing and cost of 900 refarming (and other related issues), paid for by an industry fund.


• The Government will work with manufacturers so that vehicles sold with a radio are digitally enabled by the end of 2013.


• On Digital Radio, the Government has asked Ofcom to consult on a new map of mini-regions.


• Alongside the Digital Britain Final Report the Government is publishing a community radio consultation seeking views on changes to the current licensing regime.


• Alongside the Digital Britain Final Report, the Government is consulting on a proposal to legislate to give Ofcom a duty to take steps to reduce copyright infringement.


• The Intellectual Property Office is considering the scope to amend the copyright exceptions regime in areas such as distance learning and the preservation of archive material and intends to announce a consultation on these later this year.


• The Government launched its copyright strategy


• The Government intends to consult on legislative reform in respect of orphan works.


• The Technology Strategy Board will lead and coordinate the necessary investment for Next Generation Digital Test Beds and has allocated an initial budget for £10m for this purpose.


• The Government will consult openly on the option of a Contained Contestable Element of the Television Licence Fee, carrying forward the current ring-fenced element for the Digital Switchover Help Scheme and Marketing (c.3.5% of the Licence Fee) after 2013.


• We will take the views of the Channel 4 Board on the draft updated statutory remit for C4 Corporation as set out in this Report.


• The OFT will amend its guidance to ensure that in cases relating to local and regional newspaper mergers raising prima facie competition issues the OFT will ask Ofcom to provide them with a Local Media Assessment.


• The Government is inviting the Audit Commission to undertake an inquiry into the practice of local authorities taking paid advertising to support information sheets.


• Commercial public service broadcasting liberalisation, including regional news, analogue licences and advertising minutage


• The Technology Strategy Board has assigned an initial budget of £30 million to advance Digital Britain related innovation.


• The Government will carry out a major test in late 2009 of our ability to manage and recover from a major loss of network capacity.


• The Information Commissioner’s Office plans to consult later this year on a new code of practice in relation to “Personal Information Online”.


• The Government will consult on the penalties that Ofcom is able to impose for contraventions of the Communications Act 2003 and, in particular, the level of the fine it can impose in relation to persistent misuse cases.


• Led by the Contact Council, chaired by the Cabinet Office, Government will take forward proposals for developing a Digital Switchover of Public Services Programme starting in 2012.


• We propose that DCMS, BIS and Ofcom carry out an assessment, to be completed by the end of this year, of the opportunity for bringing together some or all of the delivery agencies either into one body or through a federated structure to achieve economies of scale and greater operational efficiency.

How To Find An Extra £8bn - Fast!

They've been desperately downing the Kool Aid in Downing Street, those who are left. No more polite chat while queuing for the tea urn during cabinet meetings, cup and saucer in hand. Now they're swarming around it at each serving, ripping the lid off and plunging their cups in.

And while we are highly amused by Gordo's ghastly predicament, we are no longer to be distracted from his latest, clunking sleight of hand.

The TaxPayers' Alliance has all the gory details, but at the heart of the matter is the fact that the UK will now officially have two sets of books, as the FT faithfully reported in mid-May while we were still goggle-eyed by certain accounting matters of a more personal nature.

One set of books will be produced under international financial reporting standards to fulfil the Treasury's "promise" to record PFI projects against government's capital expenditure totals; and another will be prepared under European standards, which doesn't bake in the cost of PFI.

I do not need to point out which set of books the Treasury uses for budgetary purposes... Nor do I need to remind you that even the off balance sheet deals are getting bailed out with taxpayer's money.

So, for a start, 60% of PFI projects will remain off balance sheet. But that's not all:

Nick Prior, head of government and infrastructure at the consultants Deloitte, said: "This clarification is extremely welcome for the future of PFI and PPPs. Government departments should now be able to bring forward projects that have been delayed because of uncertainty over budgetary arrangements."

That's £8bn worth of "uncertainty" to me and you, but not even a line item for Darling, if and when he gets up on his hind legs to deliver the next budget.

Let's hope MPs don't forget to mention the fact...

Lessig: How Money Affects Political Trust

Some prescient remarks, made in the context of political donations, which apply more directly to the cash-for-amendments scandal but also suggest the reason for our concern over MPs' attitudes to expenses:

Hat-tip to Paul Miller.

Swinegate and Consitutional Reform

I've just seen some patronising rubbish in the Spectator about concern over MP's expenses being overkill and somehow bad for the British democratic process.

Swinegate is just the straw that broke the camel's back. At different times, on different issues that each of us cares about, we have all felt that politicians are up to no good in their various machinations. Now we've all caught them, red-handed, pulling the same stunt at the same time. It does not matter that we have merely caught a crowd of them failing to do something as basic as filling out an expense form with diligence and propriety. The panic-stricken response right across the political spectrum is clear evidence that the politicians now know that we know just how opaque and unaccountable Parliament is generally.

The great news is that this has alerted a wider community of people to consider what goes on in Westminster. But these are still early days in this process of awakening. So it's way too early to constrain debate by saying that constitutional reform is not the answer, for example. Let's get the whole sorry parliamentary institution laid out on the table and then figure out how to reform it.

More light, please! We have work to do...

Travels in the Blogosphere

It's been a mad week, with my spare time absorbed by an article on the behavioural targeting of internet advertising and responding to a cascade of blogs. Highlights being:

• commenting on Dave's report on SEPA's 50 year plan;



• observing the link between the "Bauman-esque negotiation between moral ideals and the problems and needs of everyday life" and sustainable capitalism;



• debunking the notion of "mass personalisation", which is about as oxymoronic as you can get;



• cheering the Tories' promise to make legislation more accessible, and wondering what on earth the recently re-labelled "Digital Engagement Team" at the Cabinet Office has been doing;



• pushing for publication of MPs and Peers' expenses at mySociety, writing to my MP and wondering what on earth the recently re-labelled "Digital Engagement Team" at the Cabinet Office has been doing;



• and of course eagerly awaiting Blawg Review #214.

I've also updated my own posts on:

• Swinegate;



• Something Decent to Read; and



• Coping with the risk of a spike in mortgage rates.

I suspect that's enough havoc for one week, but I reckon there's more to come...

Private Sheriffs in Cyberspace, Counter-Regulation

Last night I attended the lecture by Professor Jonathan Zittrain on "The Future of the Internet: Private Sheriffs in Cyberspace", organised by the SCL organised in collaboration with the The Oxford Internet Institute. Jonathan is a Professor at Harvard Law School, Co-Founder and Faculty Director of the Berkman Center for Internet & Society, a great intellect and a fabulous speaker.

As the title suggests, Jonathan was highlighting the role of private rule-makers in the development of Internet-based services. Helpfully, he suggested a quadrant on which you can place rule-making for all scenarios. On the vertical plane, one considers whether rules are decided "top-down" by a dictator or small group of individuals, or evolve bottom-up amongst all interested participants. On the horizontal plane, one considers whether the rules are handed down and enforced via a single hierarchy or via a polyarchy of different people or agencies. I've re-drawn it here for the purposes of discussion, and hope Jonathan doesn't mind:

You can plot various examples on the chart, with a totalitarian regime being in the upper left corner, and Wikipedia being in the lower right.

Interestingly, Jonathan suggests that the likes of Google, Apple and Facebook are top-down rule makers, because their site terms and policies are all decided by the company and not the users of their services, albeit those companies tend to be very responsive to bottom-up pressures. He cites the exclusion of certain lawful, though potentially offensive, applications from the iPhone and Facebook platforms as examples of decisions that might not be consistent with previous decisions, nor deemed constitutional in the public environment. He queries whether, in time, these might result in some alternate form of regulation and considers what that might entail.

My sense is that this scenario is not quite so clear cut, since the evolution of services or platforms provided by those companies (read iPhone apps in the case of Apple) seems primarily based on user participation, feedback and complaint, rather than board or departmental decision-making. I'm not even sure that, when push comes to shove, those companies necessarily triumph. There are significant instances where - to their enduring credit - each of those companies backed down and modified services and terms in the face of widespread user vitriol.

However, it is true that in general terms, at least before push comes to shove, such firms are the 'sheriff' of their own platforms. And it is conceivable that there could be a substantial gap in time, and a significant amount of individual consumer detriment - mild or otherwise - before any arbitrary, inconsistent or harmful exercise of corporate discretion is corrected by some kind of mass user "action". But of course this phenomenon occurs even in the context of highly regulated businesses all the time - e.g. retail financial services, as Financial Ombudsman statistics demonstrate. Offline retailers and distributors also decide not to distribute certain products on their own whim, or due to informal pressure from certain interest groups.

So the responsiveness of a service provider to its users, and the legality of its behaviour, does not seem to be a function of how that service provider or its services are regulated. But is users' trust or faith in the provider a function of the type of regulation that applies to the service?

Jonathan looks at various models for keeping the private sheriffs honest, e.g. vicarious liability for harmful material of which the service provider is on notice (see PanGloss), public law constraints on municipal authorities and 'due process' requirements. But, crucially, he points out that when users start to feel powerless they look to top-down bodies for help - i.e. towards the top left of the quadrant - when perhaps the online world is demonstrating there are more trustworthy solutions to the lower left and right. To the lower left, Jonathan cites the adherence to the robots.txt exclusion standard, whereby researchers effectively agree not to interrogate certain parts of web publisher's domains. To the lower right, he cites the broad editorial body of interested participants in Wikipedia. Either solution might be safer than entrusting control to, say, government institutions that think nothing of bending or breaking the law under the guise of detecting crime, or the vague notion of "national security".

And here's the crux of the problem. When does a trusted service provider suddenly cease to be trusted to make and enforce its own rules?

To me, this seems to me to be answered by whether the service provider is perceived to be acting in its own interests or that of its users - or when it loses its "human effect", as I think Jonathan put it in answer to a different question. Here, the Wikipedia example is an interesting one. As Jonathan noted there is a constant preoccupation amongst the Wikipedia editorial community about what Wikipedia is and what it means to be a Wikipedian. This has also been touched on in the context of brands striving to be facilitators rather than institutions. Is this human element necessary for rule-makers and service providers to preserve users' trust in them?

As I've mentioned previously in a wider context, the rise of Web 2.0 facilitators that have enabled us to seize control of many of our own retail, political and other personal experiences has been accompanied by a plunge in our faith in our society's institutions. Are they causally related, or inter-related?

In this context, it is interesting to consider a shining example of a service provider and rule-maker that has utterly lost its way, and our respect: the UK's own House of Commons. Weeks of attention on MPs' excessive expense claims - widely viewed as a proxy for their attitude to the taxpayer generally - has forced the nation's legislators to reconsider how they themselves should be governed. And it's worth noting that much of that attention has been brought to bear via the Internet. Ironically, and in line with Jonathan's observation about where we look to when we feel powerless, the MPs are looking to the upper left quadrant in suggesting yet another Quango as an external regulator of their activities - a so-called "Parliamentary Standards Authority". That such a body needs to exist raises huge questions about the ethics of the body it is supposed to supervise.

But who on earth should comprise the members of such an authority? How could it bring about a positive change in the attitude of MPs to us, their constituents?

Which brings us to the notion that the private sheriffs of cyberspace may have a lot to teach their 'real world' counterparts about what it means to act in the interests of their users in order to retain their trust. This is a notion that I explored in an article for the SCL in May 2006, entitled "Counter-regulation" - a term I used to describe when the law requires offline businesses to implement the benefits of successful online business models. So, to borrow from Jonathan, perhaps MPs should be looking to the lower left and right of the rule-making quadrant for an alternative regulatory solution that could begin to restore a human element and raise the level of our faith in Parliament. And maybe our suspicion of Quangos as merely a means to reward government supporters with a nice cushy job would also be eased if the Quango in question comprised a very large, active group of UK taxpayers.