Thursday, April 26, 2012

Why Do We Lack the Infrastructure that We Need?

Frank Pasquale

(There is an online symposium on Brett Frischmann's book Infrastructure at Concurring Opinions. My contribution appears below.)

Brett Frischmann's book is a summa of infrastructural theory. Its tone and content approach the catechetical, patiently instructing the reader in each dimension and application of his work. It applies classic economic theory of transport networks and environmental resources to information age dilemmas. It thus takes its place among the liberal "big idea" books of today's leading Internet scholars (including Benkler's Wealth of Networks, van Schewick's Internet Architecture and Innovation, Wu's Master Switch, Zittrain's Future of the Internet,and Lessig's Code.) So careful is its drafting, and so myriad its qualifications and nuances, that is likely consistent with 95% of the policies (and perhaps theories) endorsed in those compelling books. And yet the US almost certainly won't make the necessary investments in roads, basic research, and other general-purpose inputs that Frischmann promotes. Why is that?

Lawrence Lessig's career suggests an answer. He presciently "re-marked" on Frischmann's project in a Minnesota Law Review article. But after a decade at the cutting edge of Internet law, Lessig switched direction entirely. He committed himself to cleaning up the Augean stables of influence on Capitol Hill. He knew that even best academic research would have no practical impact in a corrupted political sphere.

Were Lessig to succeed, I have little doubt that the political system would be more open to ideas like Frischmann's. Consider, for instance, the moral imperative and economic good sense of public investment in an era of insufficient aggregate demand and near-record-low interest rates:

The cost of borrowing to fund infrastructure projects, [as Economic Policy Institute analyst Ethan Pollack] points out, has hit record “low levels.” And the private construction companies that do infrastructure work remain desperate for contracts. They’re asking for less to do infrastructure work. “In other words,” says Pollack, “we’re getting much more bang for our buck than we usually do.”

And if we spend those bucks on infrastructure, we would also be creating badly needed jobs that could help juice up the economy. Notes Pollack: “This isn’t win-win, this is win-win-win-win.” Yet our political system seems totally incapable of seizing this “win-win-win-win” moment. What explains this incapacity? Center for American Progress analysts David Madland and Nick Bunker, see inequality as the prime culprit.

The pair have just pulled together all the various studies, from both within and outside the United States, that link levels of infrastructure spending to income and wealth distribution. The evidence from these studies all points the same way. The more wealth concentrates, the more feeble a society’s investing in infrastructure. Our long-term decline in federal infrastructure investment — from 3.3 percent of GDP in 1968 to 1.3 percent in 2011 — turns out to mirror almost exactly the long-term shift in income from Americas middle class to America’s rich.

We all know the litany of ways the 1% (and increasingly the 0.1%) can opt out of the infrastructure the rest of us need to use. Even national allegiances are optional for the superclass whose corporate entities now rival (or surpass) state power. The Chinese elite hedge their bets by buying land in Australia and Europe; Europe's old money buys in to Singapore, Hong Kong, and Shanghai. Folks in helicopters don't care about crumbling roads; those with private doctors see little need to pay for medical infrastructure.

A rabble-rousing remnant of netizens can rally to preserve "intellectual infrastructure" with online organizing. But the long-term trend is toward privatization of communication networks, closed systems optimized for profit and against hacking, privacy, and "cyberterror." The claim that "commons management will dramatically reduce incentives to invest in infrastructure" will not only continue to be "frequently made," as Frischmann laments (125), but will gain ever more force and amplification in the wake of Citizens United. When the top 1% gain 93% of economic growth, and when CEOs averaging about $10 million per year see a 40% increase in pay over two years of near-stasis for average workers, we cannot speak of a single "economy." There are at least two, each with infrastructural demands of its own.

The "separate lives" of rich and poor in an increasingly unequal America will complicate Frischmann's theory. I would like to see more attention to the types of second-, third-, or fourth-best infrastructures that the working poor and unemployed will need to cobble together as public housing, transit, education, and roads crumble. Will an alternative, "free culture" develop if content providers, ISPs, and intermediaries lock down content? Will people themselves be engineered into infrastructure as the natural and built environment buckle under the strain of climate change and failed political institutions? As struggling communities fail to support hospitals and universities, will wealthy global elites purchase and operate them as their own private "common pool" resources?

The Historical Context of Scholarship

While reading Frischmann's book, I couldn't help but be reminded of the kind of scholar-statesmen Joel Isaac discusses in his article Tangled Loops: Theory, History, and the Human Sciences in Modern America. Isaac captures the ethos and attitudes of the prototypical strivers of the 1950s and 60s:

During the first two decades of the Cold War, a new kind of academic figure became prominent in American public life: the credentialed social scientist or expert in the sciences of administration who was also, to use the parlance of the time, a “man of affairs.” Postwar leaders of the social and administrative sciences such as Talcott Parsons and Herbert Simon were skilled scientific brokers of just this sort: good “committee men,” grant-getters, proponents of interdisciplinary inquiry, and institution-builders.

This hard-nosed, suit-wearing, business-like persona was connected to new, technologically refined forms of social science. No longer sage-like social philosophers or hardscrabble, number-crunching empiricists, academic human scientists portrayed themselves as possessors of tools and programs designed for precision social engineering. Antediluvian “social science” was eschewed in favour of mathematical, behavioural, and systems-based approaches to “human relations” such as operations research, behavioral science, game theory, systems theory, and cognitive science.

In his comments to the FCC and broader influence on policy, Frischmann reminds me of these "business-like personae." And yet the egalitarian social consensus that underwrote their "Cold War reformation of the human sciences" is gone now. There is intense public and private enthusiasm for infrastructures of surveillance, discipline, and punishment, but not for the types of productive general-purpose bases of enterprise and culture that Frischmann promotes. Those are increasingly left to market provision, to be "consumed" or not based on individual choices and purchasing power.

The future of infrastructure studies is thus bifurcated. A "planet of slums" will improvise access to transport, environmental necessities, communication, and education. The declining political institutions of the developed world will try to marshal the redistributive taxation (and regulation) necessary to maintain key institutions Frischmann praises and justifies. Some of their more enlightened functionaries will no doubt offer Infrastructure's theories as rationales for shoring up broad access to public goods and common pool resources. But they will be drowned out, litigated around, and most likely consigned to irrelevance by the extractive elites who dominate our politics. Kazys Varnelis has observed that "the exemplary infrastructures of the 1980s and 1990s--telecoms after deregulation, the mobile phones, the Internet—-are privatized." The current legislative agenda is less concerned with extending the emancipatory potential of the Internet than it is with conforming it to tried-and-true profit models of mobile telephony.

Frischmann might have subtitled his book Why Nations Succeed, contrasting the thriving commons resources of prospering nations with the atavistic balkanization of failed states and institutions. Framing his work in narratives of positive-sum games might draw more attention from journalists and policymakers. On the other hand, the book that's grabbing all the headlines now is Acemoglu and Robinson's Why Nations Fail, which focuses on the factors that keep policy frameworks like Frischmann's from having the influence they deserve. Ron Unz of The American Conservative applies their model to the US:

When parasitic elites govern a society along extractive lines, a central feature is the massive upward flow of . . . wealth, regardless of any contrary laws or regulations. . . . [A]lthough American micro-corruption is rare, we seem to suffer from appalling levels of macro-corruption, situations in which our various ruling elites squander or misappropriate tens or even hundreds of billions of dollars of our national wealth, sometimes doing so just barely on one side of technical legality and sometimes on the other. . . .

Ordinary Americans who work hard and seek to earn an honest living for themselves and their families appear to be suffering the ill effects of exactly this same sort of elite-driven economic pillage. The roots of our national decline will be found at the very top of our society, among the One Percent, or more likely the 0.1 percent.

We can see similar diagnoses in Brigham Young Professor of Political Science Earl H. Fry's book Lament for America, or any of Andrew Bacevich's recent books. Frischmann's work is an excellent guide for wise and public-spirited rulers who want to increase America's living standards and contributions to global prosperity. The question now is whether, in an age of revolving doors and narrow interests, there are important political channels open to its message.

Simulposted: Concurring Opinions.

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