books technology

Overconnected, by William H Davidow

Books about the dangers of the internet aren’t likely to get much of an audience right now, and some might be tempted to dismiss them as neo-Luddite scare-mongering. But a book about the downsides of online connectivity written by an insider, a venture capitalist and former VP of Intel, well, that might just get a little attention.

William Davidow watched the development of the internet from the ground up, overseeing the development of the microprocessor chip at Intel and part of a circle of Silicon Valley pioneers. He now believes that the internet has push us from an ideal state of being ‘highly connected’ to the unstable state of being ‘overconnected’.

Underpinning the idea of overconnection is the concept of feedback. All inter-connected systems have feedback loops where information is relayed back through the chain to modify behaviour, and that feedback can be positive or negative. Negative feedback resists or limits change – a thermostat, for example, maintains a constant temperature by alternating between ‘too hot’ and ‘too cold’. Positive feedback reinforces and accelerates change – a rising stock price attracts more investors, which drives the price higher still. The internet, Davidow suggests, is beset by positive feedback.

What this means is that change happens very fast, feedback buzzing back through the system. Sometimes it’s benign, a viral video phenomenon for example. Other times it’s not. 139 people dying in violent clashes after 12 Danish cartoons mocking Islam were posted online, or the collapse of the Icelandic Krone, are examples of runaway reactions fuelled by the internet. “The internet has created a world where speed erases the ability to reflect” says Davidow. “The actions society takes have become so complex and interwoven that the simplest ones have effects far beyond what we imagine.”

The problem comes when our institutions, laws, and culture cannot keep up with the pace of change, creating what William Ogburn called ‘cultural lag’. This was clearly visible in the economic crisis of 07, where financial regulation was woefully inadequate to keep up with dynamics of online trading and derivatives. It’s visible in the way the music industry has been unable to adapt to the digital age, or the steady decline of newspaper readership in the face of blogs and online news services.

Again, some of this is benign, the process of ‘creative destruction’ at work. But our overconnected world opens up all kinds of loopholes and possibilities that international governance cannot keep track of. The biggest, and one that Davidow doesn’t discuss, is probably offshore finance.

Overconnected explores these various themes from a variety of different angles. There are historical comparisons, from how the railways changed business in Chicago, to the development of the suburbs, or John Law and the South Sea Bubble. The rise and collapse of Iceland’s online banks is discussed extensively as a case study, as is the subprime market. There is an introduction into the study of accidents: “in highly complex and interconnected systems, accidents are a normal occurrence, and there is no way to avoid them.”

When it comes to solutions to calming down our overconnected world, it’s obvious that the internet can never go back into the box. We can do two things, Davidow suggests. We can be aware of positive feedback loops and slow them down, and we can design safer and less complex systems in future. Specifically, we could slow down international currency trading with a Tobin tax (how long do we have to wait for Tobin? It’s coming up on 40 years and it’s just as common-sense as it ever was). Stock markets could have agreed limits to how far prices can change in a given day, as some commodity markets do. Credit rating agencies should be regulated. Universal labour rights could slow the drain of offshored jobs. We could all save more, and governments could try to balance their budgets.

It most of these solutions sound like they have little to do with the internet, that’s partly the case. These are attempts to live with the complexity rather than reduce it, and that’s probably the best we can do right now – but we can do our best to avoid any further complexity. And that’s more or less where Davidow leaves us at the end of this counter-cultural and esoteric book, with a plea for ‘caution and forethought’ as we try and make the best of our overconnected world.

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