Monday, January 30, 2012

The New Deal on Data

Prof. Alex Pentland, MIT Media Lab and

Science, and the idea of natural law, can help us reinvent our society to be more stable, fair, and efficient. The idea of natural law began in the 1700s, when philosophers realized that the laws of society should be matched to human nature. The founders of the United States believed in natural law, and chose as their model of human nature individuals continually competing for money and seeking power.

But is this really us? Are we doomed to eternal fights for money and dominance? The wars of the last century might suggest so, but that same century saw unprecedented progress in life expectancy, poverty eradication, and political inclusion. So if we aren’t creatures of eternal competition, then what are we?

The scientific evidence is that pre-agricultural societies were egalitarian, supported the weak–and yet were also efficient. However, they were not based on open competition, but instead on private exchanges within social networks. Each person had special skills and information, and these were traded to others for food or favors. You bargained one at a time with the people you trusted, and the influence of the rich and powerful was limited.

So it would appear that philosophers of the 1700s got natural law WRONG. Unbridled competition is not natural law for humans. But as a result of their mistake we have been left with a legacy of unstable banks, unfair governments, and inefficient companies. Instead of unchecked competition, modern science says that human natural law is: trade with the people with whom you have trusted relationships, instead of fighting with faceless organizations or market machinery. So why should you care? We aren’t likely to re-write our government constitutions anytime soon!

But increasingly we are using digital social networks to reinvent our society, and we have the opportunity to build this new society using scientific insights about human nature. We can shape this new digital society around a new, a more accurate version of natural law. By encouraging interactions within trusted relationships rather than promoting unbridled competition, we can create a more fair, stable, and equitable society.

So, how does this work? The key is that individuals have rights in their virtual, digital selves that mirror the rights they have in their physical selves. You should control data that is about you, how it is used, and where it goes. Your interactions should be guided by trusted relationships rather than being subjected to nameless others.

This framework is called the New Deal on Data, and it has surprising mathematical properties. By giving people control of their digital selves, we can build a system that is more stable and more fair than today’s market-based systems. In the past, the costs of communication limited such systems to small scales, such as town-hall meetings. But thanks to the power of modern digital networks, these grassroots systems can now scale to planetary size and still be efficient and innovative.

Imagine user-controlled banking where you could direct your money to community projects that you cared about, and yet still control risk and return. We could fulfill the dreams of micro-credit and community lending, but without sacrificing performance or scale. Or imagine citizen-controlled government where you could direct where your taxes go and shape your local laws. You could achieve the ideals of local governance, but without sacrificing safety, fairness, or efficiency.

So how can the New Deal on Data become real? At the World Economic Forum we have achieved a remarkable consensus among governments, companies, and advocacy groups. This consensus contributed to last week’s announcement declaring the elements of the New Deal as being basic human rights–that is, as being natural law. To help bring the New Deal into everyday life, we at the MIT Media Lab and at have developed the open-source software and legal frameworks needed to field test the New Deal at sites around the world.

Alex 'Sandy' Pentland is Toshiba Professor of Media Arts and Sciences and heads the MIT Media Lab's Entrepreneurship Program.

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