The late economist Hyman Minsky had an aphorism:
It’s easy to create money. The trick is getting it accepted
This aphorism can be adapted to other realms.
It’s easy to create a software standard (like the Internet protocols, or an operating system, or a programming language). The trick is getting it accepted.
It’s easy to create the software architecture for a social network. The trick is getting it accepted.
It’s easy to create a law. The trick is getting it accepted.
It’s easy to create a social norm. The trick is getting it accepted.
It’s easy to create a religion. The trick is getting it accepted.
It’s easy to create a credentialing system. The trick is getting it accepted.
What to call things that are like this? I like the term “consensual hallucination,” as William Gibson defined cyberspace in his sci-fi novel Neuromancer. But a more standard term would be “social convention.”
We live in a web of social conventions. Each social convention by itself is a sort of Chesterton Fence. You may wonder why it’s there, but take it away and you may not anticipate what will happen elsewhere in the web. You ignore potential interdependencies at your peril. De-fund the police (or delegitimize them) and crime goes up. Get rid of government schools and replace them with a voucher system, and perhaps you get only the intended consequences, but maybe you don’t.
Once social conventions have been adopted for awhile, they become very sticky. Is Microsoft Word the best possible word processing program? No, but try to replace it. Is Facebook the best way to design an online social network? No, but try to replace it. Is the U.S. patent system the best way to address intellectual property? No, but try to replace it. Is a Harvard MBA or a Yale law degree the best credentialing system for finding people for powerful positions? No, but try to replace them.
Freedom of speech is an interesting social convention. The First Amendment (another social convention) technically applies only to the U.S. Congress. But many of us seek to promote the social convention of free speech more broadly.
Private property is a social convention. The economist Hernando de Soto in The Mystery of Capital, pointed out that having clear legal title to land makes a tremendous difference in a society. Without it, people cannot rely on enjoying the benefits from building on that land. They cannot borrow against their real estate assets. They have only what he calls “dead capital.”
Our society treats property rights as essential. We follow John Locke in this regard. Or a natural law tradition that preceded him.
Karl Marx’s followers saw private property as an evil social convention. Just get rid of it! Well, we know what happened.
Philosopher Michael Huemer’s The Problem of Political Authority questions the usefulness of giving government the right to coerce and citizens the duty to obey. Could we not get rid of these social conventions? I reviewed his book skeptically. I wrote,
I suspect that the real reasons that people buy into political authority cannot be found in the work of political philosophers, such as Thomas Hobbes, John Rawls, or James Fishkin. The true reasons are implicit, and someone needs to undertake the task of teasing them out. Until we know what the real reasons are, we will not be able to refute them.
This is not to say that we should never tinker with social conventions. Progress depends on successful tinkering. But we should always be wary that an experiment in social (re-)engineering may not work.
Keep this in mind as you read Balaji Srininivasan’s How to Start a New Country. He strikes me as cavalier about the stickiness and interconnectedness of some of the social conventions that he thinks can be cast aside.