civilian leadership to create the transportation system, the civilian leadership that is able to provoke -- produce 96,000 airplanes in 1944? jaron lanier a pioneer in the virtue in reality -- and weakened our middle class. this is about one hour and 40 minutes. >> thank you so much. i will try to heed the warning and not fall off of the back of the stage. oh my.it is bright, wow. thanks for c-span. is the c-span audio okay?

can you hear me? thanks for coming out. i used to live here so it's extremely familiar. i used to haunt the bookstore when i was younger at a time so long ago and i cherish this particular story and i thank you for supporting it. we just lost the last significant bookstore in north berkeley where i live and to not have the bookstore really changes things. it's extraordiextraordi nary. you know i would like to believe that it gets the support but it doesn't. it's just not the same so these are really precious places. so, this book. these extraordinary wafts the pollen that, for from the ocean borne by our fog. okay. 30 years ago or so, 30 and some

odd years ago i was part of a circle of young techies and i'll bet there are other people from that circle who are here, who are just on fire with this idea about how we were going to improve the world. we were going to get digital networking to happen. we were going to get amazing experiences to happen. we were going to make computing easy and accessible to everybody and it was going to create this huge wave of well-being. i remember anticipating this so tangibly that i could feel it. i could feel wow we are going to do a wonderful wonderful thing for the world. and i still believe that we will and we have a little bit, but in my view, in my experience something started to go wrong and it's gone really pretty bad. so i want to explain that is. it started my motivation and it's how i came to the position that i have now.

when huge new waves of technological efficiency have appeared in the past, they have often been imperfect. they have often created little power centers or disruptions in all sorts of things but generally the appearance of the interstate highways, the plumbing, electricity and the wall, nitrogen fixing fertilizer , these clean water available with a turn of an op in your home. when all of these things appeared what is undeniable and really apparent thereafter is a wave of improvements in well-being for people. fast portions of the population started doing better in all kinds of things were opened up. i was certain that was going to happen with digital networking but it's not exactly the way things went. starting around the

turn-of-the-century i started to notice a pattern that was really bothering me, which is that my friends who worked in the industry that were the most effect did by digital networking first and i'm thinking of musicians and journalists and photographers were not finding the new opportunity that i had for so long anticipated would appear. instead i ended up almost every week being part of the fund-raiser to help someone get a crucial offers many did when they didn't have insurance or something like that and i'm talking about people that were well-known and carried not the unknown ,-com,-com ma not the unfamous but these were well-known physicians -- musicians who are ashamed to admit they needed help. what really hit me was the financial crisis, and i'm focusing here on the developed world. i will get to the developing world later but the whole developed world and approximately the same time got itself tangled up in financial

absurdities. you have the most powerful country losing their credit rating. you have lots of social mobility and jobless recovery and the hollowed out job market, insanely tight credit, massive waves of financial fraud or pseudo-fraud and most of all there was a phenomenon of intense concentration of wealth and influence and a loss of the broader middle wealth and influence, a decline of what we call the middle-class. this happened in societies all over the world, not just here. all of the developed ones in this just blew my mind. now, when i look at this i noticed something that sent chills down my spine which is that all of the newly powerful elite, all of the people who are really at the head of the game and i have to mention i have done pretty well at this game myself so i'm not talking about

some remote other. i'm talking about me and my friends and i know many of the individuals who have done really well in the last 15 years. these are my buddies. every single one of us who has done well is somehow close to one of the biggest computers on the net. what i started to realize is that in the new system we have created power and influence for accumulating around the biggest computers on the network. this happened in finance and it happened in the insurance. it happened and electoral politics. it happened at the media. it happened with nationstates. it was happening all over. so i thought back on my idealism from when i was younger. i have been kind of the firebreathing chairperson for years to help make up for the rhetoric and what we have always believed is that if you made information available as an

ambient resource it would create so many opportunities in so much efficiency in so much creativity that we weren't sure what would happen but surely the incredible sprouting of good benefits from that would overwhelm any problem that was temporary. but we failed to consider something which is, if you want a utopia where you have all these people sharing information and everything is available, people may be created equal but created -- computers are not created equal. computers are vastly different from one another. computers are giant server farms powered by their own power plants and cooled by rivers. in glaciers. there are all these exotic ways of dealing with these giant things we have to build. some of them belonged to financial schemes and some of

them belong to social media or search company and some of them belonged to financiers. there are all kinds of different ones. some of the weird distributed once a take over computers are run by criminal organizations but they are all basically doing the same thing. so what happens is if everybody shares equally, whoever has the best computer gets unnatural advantages, gets advantages that are so profound that they seduce the owners of the largest computers into well, let's say when you are gifted and when you're privileged you often don't notice it. it's a thing that's invisible. it's a form of failure that sneaks into people and you end up essentially taking advantage of your position without ever intending to, without ever knowing because it's the most natural thing in the world. one way to explain what it's

like to have the biggest computer on the network is to go back to a thought experiment creature from a 19th century. you're going to notice that i'm going to go to the 19th century a lot of this talk because i feel the 21st century is in a way that those the 19th century in a multitude of ways. so there is a creature i would like to introduce you to and actually in a town like this that are so educated and most of you will know about this but i'm going to talk about maxwell demon. how many of you have encountered this demon? well, okay. maxwell demon is someone who you will meet if you take it class of introductory thermodynamics. oh no he's going to talk about physics, run, run. it's really simple. james maxwell headed demon named after him. imagine the little demon who was opening and closing a little tiny door. it's just an itty bitty door. the demon is watching molecules

into chambers that are right next to each other and the little door connects the chambers. each chambers filled with a fluid, water and air or something like that and the demon is watching the molecules approach the approached the door and if there is a really hot one on the left side they will let it through to the right side and if it's a cool one running nice and slow in spite of the demon will let it go to the left side. just by observing these molecules and opening the door carefully the demon separate the hot from the cold. once you have done that, you can do something rather nice which is open up the bigger door and let the whole than the cot fix again running a turbine and repeat the process and you have perpetual motion, right? global warming solved. perpetual motion machines don't work and the reason is really interesting. they have of discrimination, the active dealing in information is real work. it's never purely abstract.

it's never separated from reality so they act of opening and closing that little door and observing those molecules in itself takes more power and generates more waste and he then you attempt to say by running the turbine in between sessions of this is also known as no free lunch. you can never get ahead of the game. every purported potential motion machine turns out to be a maxwell demon fallacy if you understand it well enough. now what has happened with the computers is that the owners of big computers without even meaning to, without any attempt to pretend they can be maxwell's demon of economics instead of thermodynamics so here's how it works. the most familiar example is probably american health insurance, that most cherished of american institutions. so health insurance used to try to calculate risk and there were professionals called actuaries and they had to write down

figures. they had to work with poor information very roughly gathered and in a crude sense they would try to set the rates of policies. their job wasn't really to exclude people by surprise however. that only became possible when there is so much data and so much computational power to work with the data that you could start to be -- pretend to be maxwell's demon. you gather correlations to predict who is going to need insurance and then you open your little door and you say to people i'm like we do need an insurance gather over here and the people who will need the benefits of insurance will be put on the other side of the door and thereby by having the biggest computer you create the perfect investment. we create the perfect scheme that can't sell because we are only insuring people who need us and we know for sure we will make a great profit. there is a story i perhaps shouldn't tell so i will tell it

without naming the people. this was in the book originally and the editor's lawyer cut it out. [laughter] there is the little island that is used by the republican establishment in terms of large corporations for planning retreats and i won't say where the island is and i have it consulting gig helping the largest american insurance concerned figure out how to operate their big computers when they first got them and i remember the ceo of this concern talking about how will we really love to not insure people who are going to turn out to need insurance and we should be able to avoid doing that. at that moment there was this weird rushing sound. then there was this enormous -- it was like a little earthquake and it turns out there was a meteor strike right next to us. and so anyway those of you -- [laughter] those of you who are astronomers

interested in meteors who are seeking a device to track meteors should really look at the population of health insurance executives. you will find what you need. so the metaphor i am making of maxwell's demon in the so-called perfect insurance scheme should be clear by now. you'll old bird this door and you think you are creating the perfect business that is all benefit and no risk that the problem is you are radiating this heat, you are radiating the risk out to the world and the world is large. it can't absorb all the risk. it can't absorb all the people who need insurance. so eventually the system breaks and you undermine the system in which her own wealth even made sense so it's ultimatelultimatel y self-destructive but in the immediate sense it's more disruptive to others. in the short term since you can say it doesn't hurt -- but

ultimately everyone is heard even the people trying to run the perfect investment. this has happened to health insurance in america which we can see just by looking at the state of our country but it's also happening in finance again and again and again. some friends in mine used to work in an outfit called long-term capital. remember that one? there was an attempt to use computing to make the perfect fund. it seemed too good to be true so they hired a bunch of people that had enterprises and economics associated with and it looked perfect at first. when it failed, it failed did and guess who paid for it? hello all of you. you paid for it and there was another one called enron. and enron was doing exactly the same thing. a great big computer, let's make a perfect example because we can predict where the risk is and make sure that the other the other people other is. i i remember getting a call from enron.

they wanted to buy my little start up and i thought no, no, no we don't want to sell our pretty start of that we love so much to some company trying to take advantage of a computing. guess who bought it? google. and i love google and i'm sure there are google people here tonight. you guys are great but you know we will get to that. [laughter] so the thing about it, even though maxwell's demon illusion breaks after a while the temptation is so great because at least in the first phase it does work. if you have the biggest computer in a connected network you can calculate little tiny ways to improve your game so that other people get their risk and you get the benefits and everything seems golden. everything seems perfect but what happens in finance? what happens to insurance will happen in silicon valley doing

things the way for doing them and happen in every other area for life that we try to organize this way. this is the fundamental pattern that we have to figure out a way to transcend. it's not going to be easy. then on the other side of it, it's great when it works. so it's like heroin or something. it's information heroin. you have to find a way to get off of it. now, i mentioned that i would be returning to the 19th century and again and again so i will return to it now. in the 19th century, a lot of things happen. there is a whole 100 years there. there was a civil war here. lots of new technology, lots of new science but in terms of human thought there was a unifying theme that was so powerful and so present that the expressions of it remain dominant today and the theme was

robotic society. the 19th century was defined intellectually through an amazing degree by the fear that people would be made obsolete by improving technology. you might not think of that that is being a 19th century concern. you might think of it as being a more contemporary one but let me give you a couple of -- textile workers being concerned that they would be made obsolete by improved textile machinery, by improved blooms. that was a very ugly early battle that resulted in public executions and whatnot. that in turn strongly influence the 19th century thinkers and they mentioned in particular karl marx. if you read the early marks, from the 1840s marks is really at that time it technology

writer concerned with precisely this issue. i describe in the book i was driving a i think on the elmo and i was listening to kpfa but i didn't know it was. there was somebody going on and on about how they were going to lower the barriers and going to all this stuff. it's another one of the silicon valley startups and i cannot listen to another one of these but he was actually reading mark's. i thought might god. if you forget about it, i'm not a marxist. i think his proposal has been proven to fail but if you read his descriptive work on what was going on with human life in the world of technology wow he is contemporary. it really is extraordinary stuff. there aren't that many thoughts for the 19th century familiar to us but the ballad of john

henry is one and it's about a guy who is laying railroad tracks and manages to win but dies from exhaustion. it was sort of the tragic ironic people in a race against machines. the literature of the 19th century is with us today and we call it science fiction. the earliest science-fiction was directly motivated by a fear of obsolesceobsolesce nce. a wonderful examine of hg wells time machine where he uses species one of which benefits from being i don't know, it's like the descendent of those who rule facebook and google. they are the rich ones. they e the other ones. the interesting thing in wealth of nations both sides are made to look ridiculous and absurd by their situation. but if you look at science-fiction occasionally the

alien makes it obsolete but it's one of the other. his eyes a question of whether humans will become obsolete or not and usually it's machines that makes us obsolete and this continues to the day with terminator movies and matrix movies and on and on. that is the theme over and over again. this science-fiction and marxism books started out of the robotic society of the 1960s. very interesting thing happened in the 20th century. in the 20th century we didn't see massive waves of unemployment because of improving technology. and of course the reason was that new jobs were created when machines got better and those jobs were usually more desirable. they were safer and easier and more dignified a more intellectual and all of that but it didn't happen automatically. there was this little thing called the labor movement and the labor movement was no small thing. it was a gigantic bloody difficult movement.

the labor movement in a sense was fighting for their right to get paid even if your job isn't as miserable and dangerous as all jobs. that is something they have forgotten. let's imagine for a moment that this bookstore is located in rochester new york instead of middle part california and if we were in rochester we would remember the 19th century was the center of the manufacture of buggy whips and the buggy whip went obsolete it has motorized vehicles came along. now i love horses but dealing with horses as a necessity to get around is really a pain. i don't know if you have done it but there is the feeding and posts and getting kicked and the fact that not all of them are that nice. the whole thing is really a big big -- so having a motorized vehicle is probably cool but it's so fun

you wonder why people wouldn't pay to drive them instead of being paid to drive them. if you ever wonder why the teamsters union is a tough union, because it has to be tough to assert that even though all you are doing is sitting there and putting your foot on the pedal and and steering the wheel you still deserve to get paid. that is why cabbies get paid and every time that you see a job that isn't utterly miserable and dangerous but still pays you will notice something about that job which is that there was in fact some struggle that created some sort of wretched or structure that help those people get paid despite the fact they are not risking death. there is either a medallion or union membership or a 10 year for academics for something. there is always some kind of little mechanism. this is the reason why in the 20th century we got better jobs to go with their technology. it wasn't so much a question of whether people were still needed

or not. it was a judgment, hard-fought, a hard-fought win or the judgment that even if the new roles for people were more flexible thing in the old rules he was to get paid more. that is what happened in the 20th century. unemployment crisis averted. middle-class strong especially in the post-war years. now, at the turn of the 21st century, we suddenly decided to renege on that covenant. we suddenly decided you know what, screw evolution. we will just let people go obsolete. now let me explain how this is happening. one of the magical little tools that are available for us seemingly for free is language translation. approximately into a translation. you can update an essay in english and get it back seemingly automatically turned into a spanish essay.

it's not perfect but it's readable and google does it, microsoft does it. the first company to demonstrate he was actually ibm but it's a pretty common thing at this point. so, the way we talk about this most commonly is as if there is a giant artificial brain and a privilege to get the services of this artificial brain for free. is that the wonderful world in which you can benefit from this artificial brain that can translate different languages for free? now there had been a time when there was a hope that this brain might be created. it goes back to the 1950s when some of the pioneers were really sure who would be involved and martin was one of my mentors when i was young, one of the founders of the ai field. marvin assigns them grad students to a summer project to see if they could translate languages. a smart mathematician might be

older, but the formula. now that doesn't work. it famously doesn't work. what does work is what we call big data or giant corporeal or whatever terminology preferred. what happens as we gather up large numbers of examples of real translations done by real people and we pattern match those against your example defined a little place of coincidence and then we mash-up its translation into sequence to form a new translation. lo and behold that's not so bad. that is how it works. that is how the game works. the thing is, it's not a magic artificial rain. it's a matchup of real people who we pretend don't exist. so what we are saying is as the technology progresses and gets better and better fewer multilingual, that job of translating is not like being a

truck driver or a cabdriver even though it's not miserable. this time you get paid for it because we have anonymized you and we have pretend you don't exist to create the illusion of a giant electronic brain. okay, so this is yet another example of what i call a siren server for a maxwell's demon where we are creating a solution that all the value goes to one side. we are going to let all the value from a generation go to one site but all the people who are doing the work go over to the other side. we are going to try to make the perfect scheme where we owned this electronic brain. when big data is involved and when you hear the words artificial intelligence or something like that or the word automatic, what you should here is instead the word accounting fraud. what's actually going on is that the real people who did the work are being forgotten. they are being hidden behind a curtain. there isn't that of stage magic that has gone on. it's not real magic.

so, what is crucial about this is as long as we keep thinking this way if we decide to renege on that covenant that allowed it to continue even when the misery of many jobs is reduced in the 20th century, if we renege on that covenant the 21st century will be the realization of the anxiety of the 19th century that people will be made obsolete by our machines. there is absolutely no need for this to happen. not based on reality. it's based on a judgment about how we are willing to acknowledge each other. so what i'm hoping you can see here is that there is a connection between the kinds of roles that people get paid for and the tendency of whoever owns the biggest computer to naturally benefit from the possibility of trying to calculate a perfect scheme for themselves. there are two sides to the same coin. every time you happen to find yourself at one of of the biggest computers and youth use

it to improve your situation, the way it works is that you are gathering data from people and the key is that you don't have to pay for the data. if you have to pay for the data, if there was a market in it then it would be more like raw materials and you would have to pay more for more valuable information and that sort of thing. the fact that the information is free that creates the vision for maxwell's demon. now, we are in a cultural situation right now where in order for me to talk about these things, i have to. >> against the people i like the most and this is awkward because right now if you are on the side of the angel, if you are a good ers and and of course you are supposed to love open culture and open information and all

this. i have been struck that open source of code has become the eminent genii of our culture and the sensei can take any really boring thing and open source software like you know used underwear is being collected and poughkeepsie. i don't want to click on this. i don't want to know about that story. please, i will read about anything so i don't have to read about that but then if it says says -- is being used to sort used underwear and poughkeepsie. that sounds really innovative. i wonder if that will help global warning. i'm in this position of having to speak against the thing that so many people are sure will help. it's not comfortable and i myself believed it would be true for so long, don't think the open source people are the

biggest problem right now but they do create the legitimacy to a problem that is mostly exploited by entirely different people. so right now the former for information and disenfrandisenfran chisement that goes with it that people experience on a day-to-day basis is the kind brought to them by silicon valley where, and once again oh god, we have to talk about this. you have to know in the back of your mind that your prospects are getting a job and those two things go together. and it doesn't mean the courses are wonderful and doesn't mean education isn't necessary and wonderful but particular way we are doing it does undo our long-term process in exchange for short-term benefits. you might say oh all that information out there, surely all those trained people will turn it around. that is what i thought about networking. as long as the benefits are routed through computers which

they will be, then whoever owns the biggest computer will gather all the benefits and radiate the risks and the costs on everyone else. the book i go through many examples of this. i talk about the hypothetical artificial lab that you will be able to -- like an accident that will synthesize chemicals for your body and how that could create a wave of health and well-being but at the same time put doctors doctors and pharmacists in camas of some of these people out of work depending on how it's done. it could be done in such a way that the work that makes it house possible get steve monetized that whoever runs the routing computer becomes infinitely wealthy and there's just no boundary to it. the history of the world concentrated around the biggest computers is certainly not what we intended. so, we might ask how do we get

out of this? what do we do instead? i mentioned that the way people experience the silicon valley companies but the way it is hit hardest so far as the financial world. the world of high-frequency trade, the world of weird leveraged bundled derivatives and things. there are actually whole other classes of financial schemes that run on computers computers that aren't that familiar. there are these fantastical logistical schemes to move money around the precise moments to avoid paying tax anywhere and to earn interest everywhere at once. these kinds of things are very commonplace and gigantic at this point. there is an absurdity to them that is visible to the people who do them. i have a bunch of buddies who to high-frequency trades and it's cool. i mean it's really fun. it's such a neat toy.

the thing about a high-frequency trading machine is that it's making trade so fast that there isn't time for the common information for the real world to get in. so it's technically impossible for these things to be optimizing based on events and reality so then there's the other argument, their optimizing the function of the market itself. i actually think they can be legitimate but only if there is one monopolistic high-frequency trade because if there is a multiplicity of hide frequency trading machines what they do is read their own algorithms so the fluctuations they are detecting are created by each other and they collectively melt money out of the world. radiating this to everybody. do you follow-up? you will find this again and again where there will be a local framework in which what you were doing when you own a big computer seems to make sense but if you look at the bigger picture never does because there is never a free lunch. i can go over many examples of

this because there are fascinating variations. so how do we get out out of this? one-way ticket out of it is to say you know what, this is it. we can't keep the market going anymore. we need some other way to organize human affairs. we need to just get everybody -- when the machines get good or not use money money to have some perfect a political process and finally get socialism. i have gone down all of those roads and i don't think they go to pretty places. there are those who disagree with me. i have a lot of critics of the new book. one kind of critic is a person is this why you're trying to keep markets at all? what i just get money at some point? i think the problem with that is that politics also screws over people if it's allowed to function on its own terms. i think what happens with

politics is that the same kinds of power and influence in concentration d.c. and unbridled capitalism occurred in a purely lyrical way. we see communist parties use power or mullahs or whatever it is again and again and again. people are difficult creatures. i don't know how many of you, i remember being a young hippie and trying again and again to live in a group household and finding it to be terribly terribly difficult. a number of these group households are a bit down the road here. it's very hard to make politics work. the reason that it's hard is because people are just ornery. we are just difficult. i tend to believe a purely political solution is not going to happen. i think people are sort of perverse and difficult and all over the place. i think the use of markets, the use of money should be understood as something that

balances the tendencies of human society to be dysfunctional. money also can be terrible. money can concentrate power and wealth and the two terrible unfairness. i think the dual society and economics can kind of balance each other's worst failure modes and blend each other's thorn to some degree. this is a bit of a complex topic and i won't go into it now but i i hope they treated reasonably in the book. what i'm thinking is what we can hope for from digital technology is a way to not create a perfect society. perfection attempt always ends in tears. but this process of a balance of the system. i think of the way america is balanced between a legislature

and a judicial branch and an executive branch and it's an interesting idea where the hope is that each prevents the other from going off the deep end too much. and i think for the most part it kind of works. i think sometimes who wish it would work more together in a positive sense that they planned each other's tendencies for it to go entirely bad. i think we have to think that way about the society to organize their affairs or we know about, the economics and social processes are a little different because economics are more abstract and more numerical and as these two systems balance each other i think computations a third one. what i'm trying to do in the book is find that balance. those people who have socialist tendencies or lefty tendencies sometimes think i'm trying to elevate capitalism. i don't see it that way. let me give you a specific example about how bringing money into the world of information might create allen's instead of extreme capitalist people.

one of the trends concerning me and i think a lot of people is the proliferation of cloud detected cameras. governments benefit from having cameras on every corner in populated areas and software some of which came from the start of that google bot can attract people by face or gator all kinds of things and all of a sudden you have a system where government can know where everybody is somewhat everybody's doing. wars were five precisely to keep government from getting so much power but now we think it's cute. we think that's cute that silicon valley was kindergarten names can do it. that is problematic. that is really problematic. how do you undo at? the usual try to undo it -- way you tried and do it is you have some sort of advocacy group like the electronics foundation and they have lawyers that argue

with government officials who try to sway candidates to enact regulation. so here i'm looking at it and shove programmers with huge computers and huge connectivity coming up with schemes and i'm looking at government bureaucrats trying to come up with prohibition. i see it not to be a fair fight. another example is regulators trying to control traders. the way high frequency trading algorithms go you try to slow the frequency or put caps on them or something like that, you can use that as part of the little system that they are optimizing again. so what can possibly be done in? i don't think we can use the prohibition regime. you can really have some of that but it's very hard. if information costs money than the picture changes. i don't think it's the complete solution but it's hard part of it. traditionally one of the ways that the people constrain the government or for that matter

other powers is that it costs money to do things and the control of taxes creates a constraint. you remember no taxation without representation, that whole thing? the police can't just go to an auto lot in say hey say hey i want the scars from my police department. okay fine. you can do that. instead they have to argue for taxes and pay for budget and have to buy them like everyone else and it creates a constraint. if you have to pay money when you recognize somebody on a camera all of a sudden you can't do it without restraint or you have to strategize and prioritize and what it does, instead of automatic algorithm of information and creating perfect scheme it creates a much more honest situation in which you're using an amount of information to create a balanced scheme. that cost is real. information is never free. paying for it only are flex the reality which is that it has to come from somewhere because

there was work to do and it always comes from people. information are people in disguise. there are philosophical points we can go into with questions if you're interesteinterested by the creates at least a baseline that doesn't tend towards infinite power concentration because there are costs balance to this. so i think monetizing information to a degree is actually friendly civil liberty. it's friendly balancing government. there are huge questions about how to do it. i don't pretend to have all the answers. let me just go over a couple of little topics about the prospects for information costing money instead of being free. one of the first questions is does this exclude people from accessing information because a lot of the rhetoric of preannouncement information is if people have access it creates

opportunity and all that. i have to point out that we have tried it and it's done exactly the opposite. the. the middle classes thinking wealth and power are concentrating in smaller and smaller numbers. every time you tweet a complaint about the 1% who are enriching the 1%. so you have to understand the realities. it's not working. having the opposite effect for what was intended. this is something that is interesting to me. if i look at how outcomes are sorted for people and some information systems i see a winner-take-all system. i look at the people who do well in an information network connected around a central hub like youtube or amazon or a kickstarter where there is this one gathering point that everybody has to cycle through it, what you get is a tall tower and an emaciated neck and a long tail. you get tiny numbers of people who do well.

that is problematic because people are primed to want to believe and hope. so this is going back to the 19th century, what was called a horatio alger story. the idea that there are few people who legitimately do well in the system and a lot of other people who are living with their parents and running on hope. they are always within a hairs breadth but they won't get it. this really bugs me. there is a commonly held belief and dissolution of tens of thousands or hundreds of thousands doing grades because they could promote themselves on line and they could sell t-shirts and provide their kid. i tried to help the musicians doing well in our system. the numbers are tiny. it's a tokenism. it's not real. i really stress that even the people at the top of the regime, was considered to be great success is kind of like what

used to be considered just getting into the middle class. .. >> considering how many people are starting in the world so i don't want to

minimize but if that is the top then think of where everybody else is. so we have this incredible loring of expectations but for every general marbles there is 1 million who are just that close. all the people have a 20,000 or 100,000 views on you too may and they are so close and then they get if you dig san they think i could almost make this work but not quite. so society based on false hope is one of the cruelest societies and at some point* a lot of these people who are living on hope will start to have of midlife crisis when it doesn't work out. it is a shame and a tragedy waiting to happen for this generation. at some point* the facebook generation are more likely their kids will say we are sick of every financial

scheme being a computer we are sick on living off of also banned people will realize the pipe -- the price they pay is too high but i often hear the tear about if i have to pay for information in five to pay to look at a facebook page? you pay to go to a movie and people pay to go to a movie but they pay for dumb stuff all the time we have gargantuan societies based on one's instead of needs sova to talk about groups the cosmetic, of professional sports, i hardly know where to begin the economy is based on taste that is the subjective value there is absolutely no reason why we

get paid for social media and the you may say what is the point*? but here is the leap of faith. capitalism can work. markets can work they work when they start helping people courtney to create more wealth and when you have a market that grows people do better in the trading systems and a sharing system. it has happened again and again and it is entirely appropriate for the information network. yes you pay but you also get paid. the nature is unlike any other form of payment that anybody has ever experienced before we used to the ada you pay for stuff more often but you only get paid every

two weeks for your salary then you spend in drips and drabs but in this world you are paid in drips and drabs of the time in different people would find different systems to get paid. if you want to get a feeling how much you ought to be paid that is stolen from you now you can start keeping track of the discounts you get when you allow someone to spy on you. look at your club card with the groceries and local you spend in the year, the frequent-flier programs in you can start to calculate there is a fair amount of money that if it were real money instead of just a bargain, if you were in control you could make decisions that would put you into participation of a first-class citizen of of market growing instead of concentrating wealth. if you look at the end formation people are

interested in, a very interesting effect comes out instead of a few superstars you see it is connected this is the work that has been dan mike facebook to probe -- try to protect itself and it is very interesting research but it means if it is monetized we would see the real middle-class come out of something like facebook it is just possible the monetized information network would yield the middle-class in a new way instead of all the systems like union membership banalities there may be a

natural distribution of wealth to create a thicker metal. now to talk about the middle-class i have noticed my friends and even a part of me is affronted by the terror middle-class because it means bushwa, parent oriented. [laughter] of everything we must rainouts of the middle-class but i am talking something that is very different that occupied the founders of the united states. you need to have a preponderance of people for those who have collectively have more influence. the middle class to be able to out clout with the tip you need that if there is the leap that cannot spend everyone knows democracy becomes a sham.

i'm not happy with money and politics lately. i know anybody who is but if you care about market dynamics you need the same thing you need the metal to be with the tip otherwise you don't have customers or you end up with a petrus state plutocracy or some sort of fake futile that pretends to be a market but it is not so that system with the middle is robust is the central to every humane system to organize human affairs and never appeared. you cannot count on a wise and charitable the viet and this brings up another point* that i happen to think the silicon valley in the to might be one of the nicest that never appeared in history but we can let

that enter into our thinking you don't have to try to imagine the captains of silicon valley are evil were villains. they are not. i think we are cute. be our great but the problem is over time you don't know who will inherit the power and exhibit a is a company that started the pattern for all of us, hp. i know there are people here and also my condolences but it is tawdry but this is normal in will happen to every constitution. things go through periods of decadence and corruption and we have to plan a society with that realism that there will not ever be internal benevolent pierre and intelligent he leaked one

negative delete. so attempting a little stunned prod the in the book that is very experimental and to start the book halfway through with a critique of how power has been concentrated around big computers and then stopped within cool people will say what a cool booker then it will get adopted with the humanities department but a lot of french scholars would like it. [laughter] but i do something that and does that to talk about solutions even though i know for certain my first cannot be right even though i know i will read this myself and 10 years and think i was naive. but i put my neck out before

you because i think it is the essential that we have the courage to be imperfect to improve ourselves and i want to be first in line to take on that vulnerability. all my friends to our technical and run the computers are people of goodwill who are open to the ideas and i found extraordinary warmth from everybody in silicon valley and even in the centers of finance with the spymasters and all the world of big computation and i think one of the good thing "this is it" is one of the more pleasant elites in history and we have excellent shot to fix this and the final thing is humanity we're now not beholden to make -- nature lease curassows over

more than any other creature and the only way we can see what we're doing to ourselves as a the same big data we are talking about. it would be even better if not corrected combined with of computers and what we have seen is almost perfect in ability to separate the truth of big data of climate science those were subject that the e mails were leaked in the conspiracy theorist pored over then meanwhile those to put out in support of austerity measures of their scandals it took so long time to get it revealed

to see it. we have not established a way to use big data with credibility so people can hear the mets did. we have not connected any big data with truce. it as long as we live our lives with schemes trying to live through perfect investments or the perfect scheme through the demonic attempts to make everybody else takes the risk to concentrate benefits, as long as we live with that we're used to the idea of it being $0.9. i almost used to a bad word but now i am on tv. [laughter] but we are happy with big data algorithms to recommend it music we don't even know who made it and people recommend the algorithms we do this real science is

applied the algorithm does the work is supposed to find a perfect eight are not scientifically valid that may work because people are on these things they have the organizational contingent of the algorithms themselves are nonsense and in the back of our mind we know it is all a big confidence game and what i am hoping if information and cost many it might give rise to businesses in the culture of the information and that might give rise to a culture that is able to discern true from nonsense and if we can get there we are viewed as being connected to the bigger picture of how we make ourselves through the crazy century. with that, i thank you for listening and i would like to take questions.

[applause] >> please come up to the microphone. >> thank you for coming tonight. you discuss rewarding people for putting bits of information into the system as a way to make the middle-class more robust how does the creation of this informal economy and collaborative consumption fit into the model? instead of monetizing information but our assets like renting out to our homes, renting our bicycles or power tools to have a second income. does this contribute to the

ada to make the middle class more robust or do you mean information? >> i talk about being a similar thing in the book but in general the informal economy is not a good thing. people in the ghettos of the world are trying to get out into the formal economy. informal are great if you will be young forever and never get sick and the lawyers have parents to support you and there is the dilution wealth is the opposite of the informal economy i am sure there are engineers that you have staying power of around so in the case of the of many other schemes that people

try to be taxi drivers that what you notice again and again the people running the computers to read -- stay away from the wrist. they say that you take the risk it is the way that they are related in physics. by trying to create a perfect system that always wins no matter what happens on the ground, the people who are in the informal economy house to take the risk them saul's. you could rent out your place 30 times nobody rips you off than somebody -- something happens and there wasn't a risk pool or no planning. so variate gradually with the contingencies if you participate in these and formal schemes something will happen and you will be sick on the day somebody

needed your apartment and as long as you have perfect blocking it is great but what needs to happen is we need to get away from the idea of the central hub to organize people that take no planning in their various ways my concern is i will create an insurance service for people who rent out the compartment but then that becomes another example of the same pattern reappears again and again and the generalized way out is to have information be monetized which is what insurance schemes are that monetizes informations are manage the risk pool if you cannot manage that sophistication than everybody is forced into insecurity matt is what informal economies are.

>> i have been thinking a lot about these issues and thank you for making a brilliant presentation such a short time that my concern is in addition to technology fair is the specter of education and personal health and if you have a population that is not educated we all know the problem in this country is elementary education and then the problem of personal health and the food that we eat and the fact the laws have been passed that makes the world biggest genetic manipulator of seeds and not suitable anymore so it is not that educated or that healthy then how can they think for themselves and reid themselves away for

facebook than purely entertainment purposes? and you need to bring in the people to get them to your kind of thinking because without that they are not going to see the fallacy like you just said they will not see through their own actions. so how do we start do individually in this room take the baby steps? >> i have a lot of friends who are writers and there are people around berkeley whose rightabout bay issues but also give you things you can do like and food you can cook can buy things intelligently and part of me wants to do that with these things and i have not found a good way to do it honestly if i do i will write a book

but the reason i haven't is a lot of the things that i could suggest be done to the problem but it is hard to address this because a lot of it feeds into what i am concerned about like a tiny you to read about the 1% you enrich the 1% and it is a conundrum and i am working on this problem of what you can do of course, if you're highly technical it is a different story than you can do all kinds of stuff if he knew how to program than you can change your privacy settings and you can use tools but if you want to change the food system just with the organic market that cost 10 times more than what four people can afford does not solve the problem and on the technical people can take advantage does not

address anything. so i am stuck at this point* i would like to solve it but i get proposals every single day to have ideas about this. i am interested but so far i have to tell you i don't know how to answer your question. >> i am so glad to see that you mentioned jenna marbles simic you look like a jenna marbles character. [laughter] >> the reason i mention this is because in u.s. history class i teach i noted how you go back to jefferson and the notion of the yeoman farmer if everyone has a chance then they can become independent and be their own boss you're on your own land and grow your own food and have a great family and it

is this going to be possible with the internet? can we have millions of jenna marbles? i write so much of your work because you pose the question that america was supposed to be when the first europeans arrived to slice and dice said each person could have their own little plot and of course, it is highly problematic is the internet can become that although i like your idea very much that everybody should buy and sell on the internet but what do you think the vision of the yeoman farmer? >> there is so much to say about this. it brings up so many points but first the original design for networking was monetize starting in 1960

from before we knew how to make networks. the original idea included much of what i am talking about and was lost of tawdry incidents listed in the book but the reason it is because of this tradition i grew up in the west and a group in new mexico that the roads were dirt and the tail end of the old west and there is a lot that is not craig about people that are self-made and it does favor the strong and create a world of moms and gunslingers it is not necessarily a pretty world but what happened in america that the land was free except we pretended native

americans are not there and to get through your lee and you had to dozer ray monopoly and gradually we lost the romance and into the world of monetized of real estate agents and that world is a little less romantic but it is a further and fair and better and creates more wealth and coordination for people. i think it is a better world over all and that transformation as much as i like the romance of the birth of america but the truth is the transformation of the america we know is not a bad model which might lose the touch of romance that might become better for most people. >> can we get a new deal? >> there are other people

but i think if we're willing to have the of world war we would get a new deal but i don't want to go there. >> i agree the bottoms up solution to monetize information would be very difficult. had you given any thought to the meeting of minds of people on the big computers and have you given thought how big a prototype would be to make it meaningful and could that possibly end up being stratified between people who produce quality and those who consider the kitchen videos. [laughter] >> in the book i fantasize

the 1,000 top packers get together to create a new system then invent of robot that we will not put the tattoo artist out of work but it is a weird event like something that happens at the googolplex over the weekend but i propose a few different routes i'm not pretending it would be too long dash easy but we have to say how much financial suffering does it take until they realize the regime is not working? how many times do we have to go through this? we did it with savings of loans and securities securities, mortgages and ousted in debt and sovran negative and again and again how many times does this have to have been? it is like coming times list

of big computer failed before we call it craft? i don't know the answer or how long it takes until we realize this pattern is unsustainable and then i guess the few people that make the good information i don't see empirically a delicate what people interested in their interested in a general way there is a middle-class distribution that it is medium attention is a member betty getting all of it but it doesn't happen in the spokane hub network like you to get but it does with facebook. we should give each other more credit and toe proven otherwise i will remain optimistic people provide value if that is really true that everybody is useless. i don't know there is science fiction like that

was one of the recurring themes and i don't see the evidence i am more optimistic about people i don't think that makes me nighties but i try to be realistic and overall we are more interesting and valuable than what we give ourselves credit for. >> thank you very much i am one of the open source people. but to look at what you'd discuss to talk about the 21st century commend the main achievement of the understanding is equalization of information and that matters. it is one of the same in the revolution will prove that to be the case. if you think about it this way than to talk about putting value and information, it is the same

thing as property tax. >> no, no, no. i go into the 3-d printer let's say it hits big and i hope it does because it is cool. every day you have a new alpha it fit perfectly for your body and you never do laundry it is recycled materials every gave has a new guitar it is not the ownership of the people who pay for the design but i have friends who have great careers and have done very well for themselves to go to pour neighborhoods in what took the pork kids are wearing and they translate that into fashion. there is the incredibly broad base of people who come up with designs.

the terminology is awkward like servicing or design but not owning the object the more the 3d printers work work, the less ownership means that that is a totally different question. but do the people that contribute the values are they remembered and treated as being real or do we become with the illusion that they are not there? >> what i and equating when i say design i do not mean the object. information is the same thing so whoever can process the sufficient amount of information will become the most meaningful producer of wealth over time. and i think what you try to address is a tactical problem because over tens of years machines will do

better than humans. >> no, no, no. machines don't exist it is only people pretending they don't excess. you we're doing great. >> there is a number of futurist who will think that's put my question is that. by? there is a whole train of thought that does not think the way you think. >> i know. of course, i know that. people are a little crazy and very emotional but i was present in the room when open source was born and i remember richard being so upset about the machine being held up because the company went bankrupt and i understand the emotion.

and i understand my buddy does not want to die. i and a stand it is nicer to think about a perfect digital immortality. i am understand those emotions we cannot run our society entirely on passion and fear and terror and that is what technical culture is coming to. now with open source there is the alternative, there are two domains the proprietary software domain with these ridiculous licenses it is ridiculous and everybody knows it then you have open sores were you pretend people don't exist with a monster creature you pretend is the electronic brain that is actually

lowering everybody for the biggest computer but there is a third alternative that every time code runs micro payments go back to whoever wrote it. that has never been given a fair chance. i like that. if you look at how cody is built, people contribute but if you look back at the sir, a people contributed? if there were my co-payments going out that this middle-class distribution. said is the bulwark against those that are forming around the machine where they didn't have to pay for the software. the notion you put the information out there but then you support said google concentration of wealth and power. it is a failed idea. we have to try the other alternative band if the work

that way saturday and berry would make money from the search code and would not have to start this buying empire. now the internet has has been a torrent that makes new those copies to avoid paying for them and and really get the carbon footprint it is for the worse code and machines and that is precisely what we do with the current regime. >> diane and chilled of urinalysis by the big picture. fair disclosure i work for the evil empire. >> which one? i matt microsoft research and it confuses me. [laughter] >> not one of those but in the community i am an

algorithm of -- officer for online companies that is why i am worried about it. to solve the problem is trues verses many there is the truth of how things work and then the version of the truth that the powers of be find short-term profitable to have people believe collectively. the problem is promulgating the truth is not quite so easy. we have the data analysis who paid to broadcast it sold just getting it in one place is a lot so somebody needs to be profiting at every single point* to talk about this and get the word out my guess is if this

world changing message or in support you'd be filling a stadium. so broadly speaking there is a huge bias of the information business to get the word out, in favor of power, against the message you try to spread. >> for what it is worth i am all selling eric schmidt. [laughter] and the what to do instead is the hard part. i don't want to overreach that might feeling about the time we have to fix it before automation eng gets really good. before the cars drive themselves and everything is 3d printed so we have to fix it not next week with a little bit of time that i get pretty specific in the book but i leave big

questions open. i will give this talk at the googleplex and i have talked to my friends, i am not on facebook but the people who run facebook that are my friends. [laughter] i don't have facebook friends. [laughter] this is another thing people run on fear that you have to quit feeding the monster. i am not on twitter or facebook at dawn to frequent-flier i don't sign up for these things and i seem to be doing okay and everything is fine but so it might not be important but i am finding good will and good reception. i am happy the book has only been out for one week in the states but i think it has done well. i am happy. >> but the mass communication system is heartless you make personal contact with people who

matter in to get a personal response. i hope that it works. >> this is on a different direction but as far as the future of technology the use c.s. becoming ever more dependent. >> technology does not exist you give me a computer give me another the martian and knows nothing about human culture he looks at the computer and cannot tell if it is a law of the land it is just something that radiates heat without culture technology does not exist you have to know how to use it and what it means it is not freestanding we just pretend we don't matter it is saying the same thing. it is the trick of thought

it is stage magic and phony. >> i get that. >> let me try. [laughter] the example of the translator. >> has been of a 20 year gaps as i have last seen you >> my 40th birthday i happen to be given a lecture at the department and stanford there is a freshman sitting there in the first row he looked at me when i came in and said jaron lanier you are still alive? [laughter] that was at 15 years ago. >> just one question can you

speak to the two human qualities you have touched on these of hubris and humility in the role they play with the role in the future and how we can participate to create the future. >> hubris is interesting because i feel when silicon valley tries to be here again we can't pull let off because we are sweeteners but then when we don't think we're being arrogant is when we are. that is the funniest thing. when you hang out with wall street people or politicians it is different. so for a political action committee it doesn't even

make sense. there is a sweetness to the culture but it isn't just a lack of bullying the requires the hard work to see itself clearly. i am at least trying. is an ongoing process of. >> i am a parent of three kids. are you? >> i am. >> my kids are kind of geeky we try to figure out what is going on in the world would appear thoughts ward vice i try to teach them to be well educated but the you have advice on what kids are studying? what do you think they should be doing?

>> my qualifications as a parent will become known to me when my daughter is an adult which will not be for a while. i can say a couple things. i am a little worried about how structured our kids' lives are going klay to play day and everything is planned and the facebook is the extension of the play date because in the '90s talking to teenagers are undergraduates i would say how many have websites? and now nobody everybody goes to the pre-structured thing where they follow the groove that is played out that is less work but that also goes back to the jeffersonian question that everybody goes in to their pre-structured kit and i am worried.

i loved the way we can teach science to make your own robot or your own organism but there is the kit quality were it is pre-structured you don't hit the reality or the mystery because everything is so organized and structured and i worry about that. it is not good for being a person and a scientist. i am part of the problem. i will not tell her to play in the streets but i am also denying her something. [laughter] i don't know how to resolve that and it bothers me. one of the rings of hell is dealing with elementary school math teachers. [laughter] i cannot believe how incredibly crappy the curriculum is. when my daughter was in kindergarten, i went to pick her up and of little girls

were arguing. but they were arguing if infinity was a number or a weird idea. they made excellent arguments i said they're arguing if it is a number we have to do something with this. they said no. is addition and this blows my mind. it blows my mind that the natural curiosity of children around ideas and bath we don't seize upon and i don't know what to do about it. one of the things i talk about in no time left behind testing regime is also influenced through a computer you see the

phoniness for the test does not measure and to also see cheating and all the same things we see in the dating and finance world where information is unreliable and we see it with education out so the same influence is happening there and it bugs me. >> i know it has been 25 years since my company worked with yours to produce a virtual reality game consoles using your glasses and the gloves. >> is tom here? of course, i think he is the ibm research fellow now. >> i was surprised to see it was the device they got their $0.25 chip.

is this a resurgence is a coming back? >> i don't know. virtual reality every three years there is so waving and -- there is a wave and i think it is cool and brings back memories when i was a kid trying to do this. i hope they do wonderful. >> google's glass a bunch of my buddies work on it. it is a cool device but it is the business plan that it is stuck with but somebody asked before, and i think about the interest of all the people and amazon and facebook i am absolutely convinced what i say it's in their interest including the big people because we undermine our own source of wealth.

the short-term gain verses though long-term gain. so right now it employed 140,000 people and one of them was that a talk i don't mind success and i like people to be successful and i have trendsetter very successful but we should create our success through growing the economy in not shrinking it now we concentrate our many to it ultimately will come and buy just as italy says when use a computer to make a perfect scheme so facebook and appell and google's would do better because they would be part of a growing economy instead of one that is pushed down to a perfect scheme so i am absolutely on the side of silicon valley

to want to see more of it. >> thank you for coming to. [applause]

>> money and politics is our biggest threat to equitable representation in our government. what does your research revealed as far as your research is concerned? >> she is absolutely right. and there has been agreement and it is something that both parties or parts of

both parties agree they would like to get this out. some people would but others may benefit. we did not explore in great detail in this last book what the solutions could be. we talk to people from constitutional amendments amendments, to limit money and politics but before anything can be done she's absolutely right something has to be done because the amount increases and it seems the election cycle is continuous and once it was short and other countries found ways to restrict that to a shorter timeframe. which would save some money and. >> host: doesn't that open more loopholes if you restricted the time? aren't there ways around that? >> we're very inventive and no doubt perhaps the young difference is we would save a little money.

but a lot of people looked at this and we cannot agree more that you cannot change the tax code or free trade or deregulation or the whole issue of debt financing and tell -- until you could get closer to the money and power. >> and may not even be possible now that the supreme court has deemed money and exercise of free speech and that really raises the bar on us. it just means anything goes from here on out. >> host: we have a tweet tweet, how are the people to understand the true amount of what the government spends? we're is there accessible and understandable data? >> there is a lot of data i

don't think there is a shortage but the problem is always to analyze what is there. something we both found disturbing there is one whole story out there that security is in immediate trouble and the bookkeeping is not proper and it is bogus. social security will it have to be changed and the retirement age raised? possibly but the fund is not in danger medicare is a different animal but they are lumped together as if they're the same problem and they are not. all you have to do is look at the budget in brief and you can siva issues. you don't have to go tussaud library you can do this at your computer for free 24/7.

>> host: what is one site that you recommend? >> i would not settle on a single site. tipples intimation from multiple sources. >> the gao is one the comptroller of the currency currency, those numbers are there the u.s. budget is on line to numerous sites from the white house i suppose if you are a conspiracy theorist you think they manipulate the budget but those reports are voluminous. with taxation every year. >> host: but you have to learn how to read it. >> guest: it takes time. there is no short cuts. it is not exciting. people say have you ever been threatened? we have not been threatened

sitting at the library table looking at this data but that is where the heart of the work is and it takes a lot of time to systematically go through it. it it is in a way that is much more difficult. >> but to put your finger on a critical problem that goes unmentioned and that is the news media. especially now it is under such pressure and it will never be the same again it is hard to imagine how this will play out. going back in time to or three years to the news media that existed over the last 100 years, you can lay the blame for much of what has gone on by its failure to ask the right questions. >> host: there is a comment from facebook are there any young journalist

that you feel a replicating the type of "in-depth" reporting? >> guest: there are a lot of good journalist out there and there's actually a national award named that is administered from the state university. >> i thought they were supposed to wait and tell we were dead? [laughter] every year there is amazing material that goes in for the word process. that is just one so there is a lot of outstanding work going on in this country certainly at the regional level and at the national level. is it enough? we were just talking about this and we are one of the great breakdowns those that

follow those because those ranks have been decimated by cutbacks some of those that have been done there is still quite a bit going on and if you go back decades and there is less of it as long as people have a way to get this stuff published we have a certain amount of confidence that is what everybody is worried about. >> most people get their information from television. that does not do well at all. this is a real problem for

most people. >> first on my list is a book called eating animals my daughter read it and she is the environmental studies major and is interested in the food movement and i am interested. i eat meat and chicken and seafood i may come away not wanting to eat any of that or be more selective but he is a very compelling writer and i am looking forward to it. next on my list is the new biography of david foster wallace called a every love story is said go story and i have heard it is very, very well researched he was a

professor bryson just graduated and my son is a big fan but he is regarded by many to be one of the most interesting and creative writers but tragically killed himself a few years ago but we're interested what happened with his life he had many struggles and i love biographies. next it is a book called our commonwealth he said they passed away two years ago without having finished the book so friends came together to pull together his essays that basically anything that belongs to humanity it's the air, water , public

spaces, internet. and it was to protect the common to make sure everything is not taken over by private enterprise. . .

up next on booktv, "after words" with guest host toby harnden "the sunday times" of london washington bureau chief. this week that's our news editor charles moore in his latest book "margaret thatcher" from grantham to the falklands. the longtime reporter editor and columnist for london's daily telegraph presents the authorized biography of written's only female prime minister. the program is about an hour. >> host: welcome to "after words." i am toby harnden from the "the sunday times" of london and with me today is charles moore the journalist and author, spec tater in britain in the "the sunday times" and the telegraph, the daily telegraph. charles is the man responsible for -- in 1999 and also belfast in jerusalem as well. charles has