written by Twone
Data, as the new currency of this era, not only circulates in the market, but also flows in the blood of social relationships.
Like the tip of an iceberg floating in the ocean, beneath the surface of individual data lies complex social relationships and potential power dynamics. When unequal forces cause these icebergs to collide, it not only creates waves in the data, but also brings profound social impacts. In the sea of data, how can we ensure that everyone can navigate safely, draw a more just data map, protect individual rights, and navigate a clear path?
After finishing reading the preface, chapter one, and chapter two last week, this time we will read chapters three, four, and five of "Radical Markets," with the themes of immigration, investment, and big data.
After the intense discussion last week about COST/Harberger taxes, the Raw School students expressed their dissatisfaction with the last three chapters, saying, "Is that it? It's not radical enough."
So, let's talk about what the last three chapters are about and why they may seem less exciting compared to the institutional reforms discussed in the first two chapters.
And, regarding these three grand and closely related topics, especially the last chapter: Data as Labor, how can we extend and relate them to our own thinking?
VIP (Visas Between Individuals Program): Second-class Citizens & Legalized Slavery?#
The reviews of this book on Amazon are polarized. Those who give it five stars believe that it does propose new possibilities for problem-solving different from the existing system. Those who give it one star are largely due to the policy suggestion described in this chapter: the "Visas Between Individuals Program" (VIP). Some even call it a "contemporary slavery contract."
So, what is VIP? Let's take a look together.
Background: Increasing Inequality Between Nations and Immigration as a Strong Demand for Most People#
In the 16th and 17th centuries, mercantilism dominated colonialism and trade, emphasizing state control of the economy to stimulate wealth accumulation. During this period, there was support for unrestricted acceptance of immigrants, but caution was exercised towards emigration, as it reduced the size of the domestic labor force.
In the early 20th century, inequality between nations intensified, and the economic advantages of immigration increased, leading to complex attitudes, including the emergence of nationalism and racism, and the implementation of immigration restrictions by some countries.
After World War II, the inequality between rich and poor countries intensified, and the benefits of liberal immigration increased significantly, especially in areas where poor countries border wealthy countries.
And now, immigration has become the primary path to happiness and prosperity for most people in the world.
Understanding the Benefits and Costs of Immigration to Understand the Reality of VIP#
From a definition standpoint, wealthy countries are more abundant in capital than labor compared to poor countries. This difference often leads to trade and immigration activities that benefit the capital owners in rich countries and the laborers in poor countries, but may have adverse effects on the laborers in rich countries and the capital owners in poor countries.
This concept is crucial because only by understanding the inequality in the distribution of capital and labor globally can we explain why the author proposes the policy suggestion of the "Visas Between Individuals Program" (VIP) to attempt to redistribute the global allocation of capital and labor more efficiently through individual choice and market mechanisms.
What is VIP (Visas Between Individuals Program)?#
The "Visas Between Individuals Program" (VIP) is a proposal to reform the current immigration system by allowing direct guarantees of entry between individuals.
This program allows ordinary citizens to directly provide entry guarantees for foreigners, without relying solely on government quotas and regulations. Its core idea is to enhance immigration fluidity and advocate for more efficient matching of immigration needs and opportunities in receiving countries through individual choices and market mechanisms. It also aims to provide immigrants with more opportunities and dignity by reducing bureaucracy and improving efficiency.
Controversy of "Contractual Serfdom"#
A prerequisite for the implementation of the VIP system is to allow foreign workers to work under conditions below the minimum wage.
This point has been criticized because it may put immigrants in a disadvantageous labor condition, which, in some people's eyes, is reminiscent of historical "contractual serfdom."
Although immigrants can choose to leave freely, their economic dependence may limit this freedom and be seen as a form of potential exploitation, leading to a new form of contemporary slavery.
Thought Question: If you wanted to immigrate, would you find VIP more attractive than traditional immigration methods?#
Dismembering the Octopus: Antitrust Measures#
The Thousand Faces of Monopolists#
The term "monopoly" originated from the time of Aristotle, who extracted and created this concept from discussions with the mathematician and philosopher Thales. Thales monopolized the olive oil press market by foreseeing a bountiful olive harvest, demonstrating the application of philosophy in business practice.
However, in the early modern era, the form of monopolies changed, often with individuals or groups with extensive connections authorized by the state dominating specific markets. For example, the Standard Oil Company was metaphorically depicted as a giant octopus in cartoons of that era, with its tentacles reaching into the market and state legislatures, vividly illustrating its monopoly position in multiple fields.
How to Dismember the Octopus#
The author proposes a simple and radical reform suggestion to avoid the risk of concentration in investment markets: prohibit investment institutions from diversifying their investments within a single industry, but allow them to invest across industries.
Investment institutions can choose to remain small in scale, achieving comprehensive diversification within and outside the industry, or choose to be larger in scale but only partially diversified across different industries.
This strategy can be simplified into one rule: in cases where investment institutions may influence corporate governance, prohibit any investor from holding more than 1% market share in the same company.
At the same time, index funds are allowed as an exception, allowing investors to pursue maximum diversification and scale in their investments.
Thought and Discussion: Is this approach too weak?#
The book suggests that only the government can stop the march of monopolies and proposes the simple suggestions mentioned above. However, investment institutions often act covertly, and even if regulations are established to prevent investors from holding more than 1% of shares in a single company, the "octopuses" will surely find countless ways to evade and manipulate.
In the discussion, the Raw School students were not satisfied with the proposed approach in the book. Just as an octopus has eight legs, cutting off one tentacle may result in the growth of three new ones, which is also a possibility.
Data as Labor (DaL): How Have We Become Invisible Workers in the Digital Economy?#
This chapter may be the closest to everyone.
Perhaps you have never considered immigration, or you don't care about the distant monopolistic giants, but at this moment, as you sit in front of the screen reading this article, you are undoubtedly influenced by the data information of today's society.
To put it more bluntly: your reading behavior at this moment has already added "1" to the reading count of this article in the machine learning algorithm.
Most People Are Unaware of Their Role as "Data Producers"#
How have we become data workers without even realizing it? Think about the following scenarios:
Why can Google Maps better plan your trips?
Why do Facebook and Instagram make it easy for you to share your daily life?
Why can social media platforms like TikTok and Xiaohongshu accurately recommend short videos and content that you like?
...
These tech giants use the data we provide as users to train their machine learning and artificial intelligence systems. And this data is not just a series of numbers; it is the product of our labor, the direct output of our daily activities and interactions.
For example, Google optimizes its map service by learning from our trip planning, while Facebook analyzes our social activities to deliver targeted advertisements. These platforms use the content we provide—from route choices to social interactions, and even every photo and video uploaded—to continuously improve their services and target advertisements, thereby benefiting economically.
Although we are key participants in this process, most people are unaware of their role as "data suppliers" in the digital economy, rather than just passive consumers of content. This lack of awareness means that we fail to recognize the value and potential of our own data.
Data Producers Are Not Adequately Compensated#
In the current digital economy, tech giants like Facebook, Google, and Microsoft earn record profits by collecting public data for free. These companies turn every click, search, and interaction of users into valuable data, taking advantage of the public's limited understanding of artificial intelligence (AI) and machine learning (ML). However, despite being the key drivers of this process, data producers—ordinary users—rarely receive fair compensation or recognition.
This phenomenon not only reflects income inequality but also reflects the widespread neglect of the labor value of data producers. In this context, many people are increasingly concerned about the potential mass unemployment caused by AI, even though, in fact, we are more dependent than ever on human data input to drive the development of the digital economy. This contradiction reveals a deep-seated problem in the structure of the digital economy: the labor of data producers is widely utilized but rarely rewarded and respected.
Different Attitudes Towards Data: The Diamond-Water Paradox#
In the digital age, data is everywhere, but Hal Varian, Google's chief economist, argues that the truly scarce resource is the talent and computing power to understand and process this data.
This view considers data as a widely available natural resource, as ubiquitous as water, with its true value lying in its transformation into useful assets by technology and capital.
This echoes the ancient diamond-water paradox. Water, although extremely important in daily life, does not have high exchange value due to its abundance, while diamonds, despite their limited use, are extremely valuable.
Although data is valuable overall, the marginal value of individual data points is not high due to its abundance, similar to the case of water. However, the marginal value of data is not constant and is also influenced by the importance of the problem being addressed. For example, in speech recognition technology, achieving near-perfect accuracy is more important than incremental improvements in accuracy. Therefore, the last few percentage points of accuracy improvement can greatly increase the marginal value of data.
Technserfs and Technofeudalism#
The fundamental logic of technofeudalism is astonishingly similar to that of ancient feudal systems: in feudal times, serfs provided labor to the nobles in exchange for survival and the right to use land; similarly, today, countless users provide the market value of their produced data to tech giants in exchange for convenient information services.
Under this system, although users seem to benefit, they are more like slaves of technology—working on digital land without receiving the proper rewards.
This phenomenon not only manifests in direct exchanges of services but also has deeper implications in the recognition of the value of user labor. When users realize that their online activities—whether social media interactions or content creation—actually create broader value for tech giants, they may reassess the fairness of this exchange.
Worldwide Solidarity of Data Workers?#
Although technological development has strong economies of scale, it also brings buyer monopoly power, which often leads to inadequate labor compensation and hinders economic development and fairness.
This problem is not a new phenomenon but a classic theme throughout economic history and one of the core ideas of Marxian economic theory.
Just as industrial workers in the industrial age needed labor unions for collective bargaining, ensuring labor quality, and promoting career development, data workers also need some form of organization to help them ensure high-quality data, protect their rights, and effectively navigate complex digital systems without increasing personal burdens.
Perhaps it is time to launch a global data worker movement, encouraging data workers around the world to unite and fight for their legitimate rights as modern digital laborers.
This is not only an economic struggle but also a battle for fairness and technological ethics.
Extended Thinking: How Sovereign Individuals Respond to the Current Data Situation#
"Radical Markets" was completed in 2018, but at that time, discussions about data and labor were not as intense and profound as they are today. In just a few years, whether it is AI, big data, or the frequent interaction between humans and information flows, there have been more profound changes.
Today, surrounded by countless information flows, everyone has become more or less a data provider for technology companies, streaming platforms, or platforms. People provide their behavioral data and are then analyzed and optimized by algorithms, resulting in a new round of consumption.
Do you think "Data as Labor" (DaL) should be implemented? If so, how can the value of individual data contributions be fairly and transparently evaluated and compensated? (e.g., there may be significant differences in the value of data generated by different users; what mechanisms can ensure fair and transparent evaluation of contributions and provide reasonable compensation?)
At the same time, during the implementation of DaL, what privacy and security issues may arise? (e.g., privacy breaches, data security risks, etc.; as well as legal and technological means that can be used to mitigate risks)
There are many more in-depth considerations, such as how individuals can actively buy and sell their own data instead of passively losing control over it; whether more public and collective forms of governance are needed to address the unjust social relationships and information harm caused by dataization...