China’s Economic Reckoning
The Price of Failed Reforms
The advent and power of connection technologies -- tools that connect people to vast amounts of information and to one another -- will make the twenty-first century all about surprises. Governments will be caught off-guard when large numbers of their citizens, armed with virtually nothing but cell phones, take part in mini-rebellions that challenge their authority. For the media, reporting will increasingly become a collaborative enterprise between traditional news organizations and the quickly growing number of citizen journalists. And technology companies will find themselves outsmarted by their competition and surprised by consumers who have little loyalty and no patience.
Today, more than 50 percent of the world's population has access to some combination of cell phones (five billion users) and the Internet (two billion). These people communicate within and across borders, forming virtual communities that empower citizens at the expense of governments. New intermediaries make it possible to develop and distribute content across old boundaries, lowering barriers to entry. Whereas the traditional press is called the fourth estate, this space might be called the "interconnected estate" -- a place where any person with access to the Internet, regardless of living standard or nationality, is given a voice and the power to effect change.
For the world's most powerful states, the rise of the interconnected estate will create new opportunities for growth and development, as well as huge challenges to established ways of governing. Connection technologies will carve out spaces for democracy as well as autocracy and empower individuals for both good and ill. States will vie to control the impact of technologies on their political and economic power.
Some countries, primarily major connected powers such as the United States, EU member states, and the Asian economic powerhouses (led by China and to a lesser extent India) will manage to regulate the interconnected estate within their own borders in ways that strengthen their respective values. But not all states will be able to control or embrace the empowerment of the individual. Connection technologies will add to the strains of less developed societies -- forcing them to become more open and accountable while also giving governments new tools to constrain opposition and become more closed and repressive. There will be a constant struggle between those striving to promote what U.S. Secretary of State Hillary Clinton has called "the freedom to connect" and those who view that freedom as inimical to their political survival.
Dealing with this dilemma will pose particular challenges for democratic nations that share common principles of openness and freedom. Their ideals will clash with well-founded concerns about national security. In order to avoid yielding the advantage to countries such as China, which seek to extend their values of control and censorship, countries such as the United States and the EU member states will have to hold tightly to freedom and openness.
Democratic governments will most likely be tempted to further their national interests through the same combination of defense, diplomacy, and development on which they relied during the Cold War and the decades after. But these traditional tools will not be enough: although it remains uncertain exactly how the spread of technology will change governance, it is clear that old solutions will not work in this new era. Governments will have to build new alliances that reflect the rise in citizen power and the changing nature of the state.
Those alliances will have to go far beyond government-to-government contacts, to embrace civic society, nonprofit organizations, and the private sector. Democratic states must recognize that their citizens' use of technology may be a more effective vehicle to promote the values of freedom, equality, and human rights globally than government-led initiatives. The hardware and software created by private companies in free markets are proving more useful to citizens abroad than state-sponsored assistance or diplomacy.
Although it is true that governments and the private sector will continue to wield the most power, any attempts to tackle the political and economic challenges posed by connection technologies will fail without the deep involvement of the other rising powers in this space -- namely, nongovernmental organizations and activists. The real action in the interconnected estate can be found in cramped offices in Cairo, the living rooms of private homes throughout Latin America, and on the streets of Tehran. From these locations and others, activists and technology geeks are rallying political "flash mobs" that shake repressive governments, building new tools to skirt firewalls and censors, reporting and tweeting the new online journalism, and writing a bill of human rights for the Internet age. Taken one by one, these efforts may be seen as impractical or insignificant, but together they constitute a meaningful change in the democratic process.
THE REVOLUTION WILL BE PODCAST
The idea of technology empowering citizens for good or for ill is not a new phenomenon, nor is there a lack of precedents of governments dealing with how to react to this phenomenon. The arrival of the printing press in the fifteenth century is an interesting case in point. Although Johannes Gutenberg's invention was truly revolutionary, its promise of increased access to information was limited by those who owned the presses and decided what to publish and where it could be distributed. Repressive governments or other institutions, moreover, had the power to use the printing press as a tool for control (by generating propaganda) or oppression (by outlawing antigovernment or antichurch writings).
In the twentieth century, with the advent of radio and television, nations -- and those wealthy or powerful enough to gain access to the airwaves -- could control and even dictate much of what was heard and seen. Radio and television proved to be powerful propaganda tools for states that knew what to do with them. North Korea -- where people can only watch state-sponsored channels -- is a modern-day version of what was common in Eastern Europe before the fall of the Berlin Wall. Even when unlicensed radio emerged in the first half of the Cold War, and satellite television began to spread during the second half, few people had the hardware, knowledge, or expertise to develop their own programs, let alone to secure a broadcast studio or airtime.
Despite these limits, many people chose to watch and listen to information broadcast through independent sources, which had previously been unavailable to the masses. These listeners and viewers included many who worked in governments -- often putting themselves at significant risk of getting caught, losing their livelihood, or worse. A similar phenomenon is occurring today in places such as Iran and Syria, where government officials seeking unvarnished news of the world beyond their borders use so-called proxy servers and circumvention technology to access their own Facebook or e-mail accounts -- platforms their governments regularly block.
The Iranian Revolution of 1979 illustrates the shift from broadcast media to another set of communications tools. To be sure, huge social forces were at work in Iran in the 1970s, including unhappiness with the shah's corrupt and repressive regime and pressure from the international community. But many historians believe that one of the keys to the revolution was the ability of Ayatollah Ruhollah Khomeini to spread his message using a simple device: the cassette tape. Using an extensive network, Khomeini distributed tapes of his speeches to more than 9,000 mosques. As Time magazine wrote, the "78-year-old holy man camped in a Paris suburb [and] direct[ed] a revolution 2,600 miles away like a company commander assaulting a hill."
The U.S. government was wary of the power of the cassette tape in Iran, both because this new technology was too difficult to control and because Washington's eyes were fixed on the Soviet bloc and the cassette tape's possible use as a tool for spreading communist propaganda. In not using this technology, the United States missed out on a powerful opportunity to promote its values and policies and empower lesser-known democratic leaders. By the mid-1970s, cassette manufacturers had broken into emerging markets, and suddenly what had begun as a new entertainment device had become an effective communications tool.
In the decade that followed, technology helped achieve another significant step in reducing the power of intermediaries and in short-circuiting regimes bent on silencing opposition voices. Activists and human rights campaigners in the Soviet Union and Eastern Europe used photocopiers and fax machines to spread their own messages and foment unrest. The technology of today holds even more promise: comparing the uncertain dial tone of the fax machine with the speed of today's handheld devices is like comparing a ship's compass to the power of global positioning systems.
ECLIPSE OF THE INTERMEDIARIES
Today, people are far more likely to complain about having to sort through too much information than to have none at all. Perhaps the most revolutionary aspect of this change lies in the wealth of platforms that allow individuals to consume, distribute, and create their own content without government control.
This does not mean that intermediaries have suddenly become irrelevant, of course. Companies that provide access to the Internet or software applications are critical for exchanging information, and governments or state-owned companies retain the power to block access. But this power is diminishing, because not even governments can stop, control, or spy on all sources of information all the time. Meanwhile, the involvement of diaspora communities in bringing change to their homelands has vastly increased, creating new sources of financial support and international pressure. And an entire cottage industry has emerged with the goal of finding and creating holes in porous firewalls.
The combination of these new technologies and the desire for greater freedom is already changing politics in some of the world's most unlikely places. In Colombia in 2008, an unemployed engineer named Oscar Morales used Facebook and the free Internet-based telephone service Skype to orchestrate a massive demonstration against the Revolutionary Armed Forces of Colombia. He was able to muster the largest protest against a terrorist group in history and the sort of high-profile blow to militants that no Colombian president has been able to achieve in the past 40 years. In Moldova in 2009, young people, frustrated and angry over a collapsing economy and fraying society, gathered in the streets of Chisinau after a rigged election. They used messages on Twitter to turn a small protest of 15,000 people into a global event. As international and internal pressure continued to rise, the rigged election was overturned, and a new election brought to power the first noncommunist government in Moldova in more than 50 years. And in Iran last year, YouTube videos, Twitter updates, and Facebook groups made it possible for activists and citizens to spread information that directly challenged the results of the country's flawed presidential election.
Yet for all the inspiring stories and moments of hope abetted by the use of connection technologies, the potential of such technologies to be manipulated or used in dangerous ways should not be underestimated. The world's most repressive regimes and violent transnational groups -- from al Qaeda and the Mexican drug cartels to the Mafia and the Taliban -- are effectively using technology to bring on new recruits, terrify local populations, and threaten democratic institutions. The Mexican drug cartels, in order to illustrate the consequences of opposition, spread graphic videos showing decapitations of those who cooperate with law enforcement, and al Qaeda and its affiliates have created viral videos showing the killings of foreigners held hostage in Iraq.
The same encryption technologies used by dissidents and activists to hide their private communications and personal data from the state are used by would-be terrorists and criminals. As relatively inexpensive encryption technology continues to proliferate on the commercial market, there is little doubt that autocrats and hackers will make use of it, too. Finding the balance between protecting dissidents and enabling criminals will be difficult at best.
Afghanistan's telecommunications networks provide a useful case study in how connection technologies can both help and harm a nation. Since U.S. and NATO forces first launched military operations there in 2001, cell-phone access in Afghanistan has grown from zero to 30 percent. This growth has had clear positive effects: mobile-based programs enable women to run call centers from their cell phones, provide access to remote medical diagnoses, and give farmers real-time information on commodity prices. And the 97 percent of Afghans who do not have bank accounts can save and access money with their cell phones through mobile money transfers. The salaries for 2,500 Afghan National Police officers in Wardak Province are transmitted through this technology, which allows them to then transfer money to their families using text messaging.
At the same time, the Taliban have become increasingly savvy about using mobile technology to malicious and deadly effect. Taliban militants have used cell phones to coordinate attacks, threaten local populations, and hold local businesses hostage, either by blowing up cell towers or by forcing them to power down between 6 PM and 8 AM, the period when Taliban militants carry out evening operations. In February 2009, Taliban inmates in Kabul's Policharki prison used cell phones to orchestrate a number of coordinated attacks on Afghan government ministries. In Afghanistan -- and Iraq, too -- it is not uncommon for insurgents to use cell phones to detonate roadside bombs remotely.
CATS AND MICE
Realists describe international relations as anarchic and dominated by self-interested states. Although there is little doubt about the dominant role states will and should play in the world, there is a great deal of debate about exactly how dominant they will be going forward. In these pages in 2008, Richard Haass, the president of the Council on Foreign Relations, described a "nonpolar world" that is "dominated not by one or two or even several states but rather by dozens of actors possessing and exercising various kinds of power." In the interconnected estate, a virtual space that is constrained by different national laws but not national boundaries, there can be no equivalent to the Treaty of Westphalia -- the 1648 agreement that ended the Thirty Years' War and established the modern system of nation-states. Instead, governments, individuals, nongovernmental organizations, and private companies will balance one another's interests.
Not all governments will manage the turbulence left in the wake of declining state authority in the same way. Much remains uncertain, of course, but it seems clear that free-market and democratic governments will be the best suited to manage and cope with this maelstrom. The greatest danger to the Internet among these countries -- perhaps best defined as the members of the Organization for Economic Cooperation and Development -- will be the overregulation of the technology sector, which has thus far thrived on entrepreneurial investment and open networks.
Perhaps no country has more carefully considered the implications of allowing its citizens access to connection technologies than China. The regime's goals are clear: to control access to content on the Internet and to use technology to build its political and economic power. Beijing has arrested online activists and used the country's thriving online bulletin boards to spread its propaganda. All of this is part of a strategy to ensure that the technology revolution extends, rather than destroys, the one-party state and its value system. Around the world, the Chinese model of Internet control has been copied by nations such as Vietnam and actively promoted in Asian and African countries where China is investing heavily in natural resources. And Beijing has moved to co-opt international institutions, such as the International Telecommunications Union, in order to gain global credibility and rally allies behind its efforts to control its citizens' communication.
But thanks to the work of activists and nongovernmental organizations operating inside and outside China, Beijing has learned that its attempts to establish total control of the Internet will not always work. The regime has recently been caught off-guard by the use of cell phones, blogs, and uploaded videos to encourage labor protests and report on industrial accidents, environmental problems, and incidents of corruption. The July 2009 demonstrations by ethnic Uighurs in Xinjiang drew international media attention even after Beijing completely shut down all Internet connections in the region; Uighur activists used social networks and so-called microblogs to spread news among targeted audiences abroad, including the Uighur diaspora. These kinds of cat-and-mouse games will no doubt continue, but in the short run there is doubt that Beijing's attempts to control access to information will largely succeed.
The intersection of connection technologies and state power is also playing out in the other BRIC nations: Brazil, India, and Russia. In each of these states, the willingness to welcome new technology in the service of economic growth has generally prevailed over fears about how the Internet can be used by criminals, terrorists, or political troublemakers -- but not always. Last spring, for example, Alexei Dymovsky, a police officer in southern Russia, was arrested after he posted a tell-all video on YouTube exposing corruption in Russia's police force.
The acceptance, or lack thereof, of connection technologies can also vary within the governments of democracies. Turkey is a case in point. The country's judiciary has blocked YouTube, but the president has spoken out against the ban. The court ruling was prompted by a series of blogs and videos that depicted the founder of the Turkish state, Kemal Atatürk, in a potentially offensive manner. This internal dispute in Turkey raises the question about whether countries can continue to protect their version of historical events in the age of the interconnected estate.
International observers should also keep their eyes on a small group of hyperconnected states -- Finland, Israel, and Sweden, among others -- that have relatively strong central governments, stable economies, and vibrant technology and innovation sectors. These nations have already demonstrated their ability to embrace technology and the good sense to invest in broadband and research. Their governments' research and development budgets represent an exceptionally high percentage of gdp. States that invest in research and infrastructure stand to benefit down the road.
RIDING THE TSUNAMI
States in the developing world -- grouped here as "partially connected" nations -- face a different set of opportunities and challenges in incorporating connection technologies. The stakes are especially high for those with weak or failed central governments, underdeveloped economies, populations that are disproportionately young and unemployed, and cultures that lend themselves to opposition and dissent, and also for those contending with outside pressures from large and engaged diasporas living in technologically advanced nations. The sudden influx of connection technologies into these societies will threaten the status quo, leaving fragile governments in potentially unstable positions.
On the bright side, the spread of technology in partially connected nations such as Egypt is breaking down traditional barriers of age, gender, and socioeconomic status. Most of this is due to the rise of cell phones, which have the potential to create the twenty-first-century equivalent of last century's green revolution, a movement that used advanced agricultural technologies and processes to increase food yields worldwide. In Pakistan, for example, there were only 300,000 cell-phone users in 2000; in August 2010, that number was closer to 100 million. Such dramatic changes in connectivity are having an impact on the ground. In Kenya, for example, a company called Safaricom has developed a program to transfer money using cell phones, which has lowered the transaction costs for remittances, expanded access to bank accounts for underserved populations, and streamlined the microfinance process.
In some partially connected countries, such as Côte d'Ivoire, Guinea, Kyrgyzstan, and Pakistan, connection technologies are shifting, albeit slowly, the nature of civil society. A growing number of activists work anonymously and part time; Web sites are replacing physical offices, with followers and members instead of paid staff; and local groups use free, open-source platforms instead of having to rely on foreign donors. At the same time, homegrown companies are filling gaps left by governments, offering language and job-skills training, financial services, health care, and the pricing of commodities. Today's activists are local and yet highly global: they import tools from abroad for their own purposes while exporting their own ideas.
As technology continues to spread, many governments in partially connected societies are seeing more costs than benefits. This is particularly true for those that struggle to maintain their political legitimacy. Anything that questions the status quo, the party in power, or the façade of stability poses a threat. For such governments -- including the autocratic, the corrupt, and the unstable -- the potential of quick and unexpected mini-rebellions is particularly worrisome. In many cases, the only thing holding the opposition back is the lack of organizational and communications tools, which connection technologies threaten to provide cheaply and widely.
Over the last several years, regimes that carried out ham-handed crackdowns have grown more subtle and sophisticated. The actions of the Iranian government surrounding the country's 2009 elections are a case in point. In the weeks leading up to the vote, Tehran sporadically blocked certain Web sites, prevented access to text messaging, and slowed down Internet connection speeds. On the day of the election itself, the regime turned off all forms of digital connectivity and kept them down for days and even weeks (although a number of activists were able to use proxy and circumvention technology to get around the stoppage). Members of the country's Revolutionary Guards posed as virtual activists and tried to catch online dissenters in the act. What is perhaps most ominous, Iranian communications officials -- employing anonymous engineers and addresses -- created Web sites encouraging people to post pictures of the protests. They then used the sites to identify, track, and, in some cases, detain protesters.
Whether or not partially connected countries follow the Iranian example may depend on the balance between internal political stability and the need for economic growth. Those nations faced with the task of restarting or maintaining stagnant or slowly growing economies are more likely to allow their citizens and businesses to adopt new technologies and to maintain the free flow of information that is vital to foreign investment.
TECHNOLOGY, ON THE EDGE
A second and equally large group of developing countries are the "connecting nations" -- places where technological development is still nascent and where both governments and citizens are testing out tools and their potential impact. In these states, connection technologies are not yet sufficiently prevalent to present major opportunities or challenges. Although these states will invariably rise into the ranks of the partially connected, it is too early to determine what this will mean for the relationship among citizens, their governments, and neighboring nations.
Some of these states, such as Cuba, Myanmar (also called Burma), and Yemen, have tried to wall off access to certain technologies entirely. For example, they have confined access to cell phones to the elite; this, however, has led to a communications black market, which is most often used for daily communication but harbors the capacity to foment opposition. Activists in these states and in their diasporas -- such as those working along Myanmar's border with Thailand -- try daily to break the information blockade. In the short term, the regimes that govern these nations will do their best to maintain monopolies on the tools of communication.
An even larger group of these connecting states can be called "open by default" -- that is, states that are, in principle, open to the import and use of connection technologies but whose governments might periodically introduce restrictive controls, whether fueled by a paranoid elite class, bureaucratic corruption, perceived security threats, or other factors. These countries, which are found across Africa, Central America, and Southeast Asia, are potential agricultural exporters and havens for light industry. For the ruling governments in these states, one imagines that the drive to create sustainable, diverse, and more open economies will often take precedence over fears that opponents armed with cell phones will threaten the regime's survival.
Finally, there is a small but globally significant group of nations -- the so-called failed states -- that are characterized by chaos and an inability to act consistently even on the most important issues. Such states are natural havens for criminal groups and terrorist networks that may have local grievances but harbor regional and global ambitions. Somalia is one notable example of this dynamic. Although much of the activity of the country's rebels and insurgents is directed at targets within Somalia's borders, some offer international terror networks, arms traffickers, and drug lords undisturbed territory for recruiting followers or spreading their ideology. Although connection technologies can serve as creative outlets for citizen innovation in such countries, they also offer the opportunity to export terrorist and criminal behavior.
TEAR DOWN THIS WALL
Efforts by democratic governments to foster freedom and opportunity will be far stronger if they recognize the vital role technology can play in enabling their citizens to promote these values -- and that technology is overwhelmingly provided by the private sector.
Companies whose products or services revolve around information technology -- be they producers of cell-phone handsets, manufacturers of routers that are the building blocks of firewalls, or providers of Internet platforms -- deal in a commodity that is inherently political. In the interactive world of Web 2.0, the prime mission of some of the technology sector's fastest-growing corporations is to provide cross-border connections. Little wonder that the old-guard officials who dominate repressive regimes see these companies as little more than the arms dealers of the information age. That said, although the United States and other countries can publicly warn Chinese officials to abide by international human rights agreements, companies can actually act -- by publicizing how governments around the world censor content or simply cut off their citizens from the world. Cell-phone companies play a particularly important role in this effort, because in many parts of the world the cell phone is one of the few resources local populations can use to stand up to abuses.
The nonprofit sector and individual activists around the globe also face new opportunities. In the interconnected estate, they will continue to shape government and corporate behavior by promoting freedom of expression and by protecting citizens from threatening governments. But at times, they will have to adjust their tactics to reflect the new environment in which they operate. This means, among other things, ensuring that efforts to expose wrongdoing do not strengthen governments apt to make nationalistic appeals; working behind the scenes when that route will produce better, faster results; and using the technology that the private sector creates for their own ends. A Web site called Herdict, for example, collects data on blocked sites in real time, creating a public log of disruptions to the free flow of online information and enabling an unprecedented level of user-generated transparency.
For both companies and the nonprofit sector, the interconnected estate provides a place where they can join together in new alliances to multiply their impact. One example is the Global Network Initiative, an organization that brings together information technology companies, human rights groups, socially responsible investors, and academics in an effort to promote free expression online and protect privacy. (Google is one of the founding corporate members.) GNI has issued specific guidelines for companies and other groups forced to confront governments that censor content or ask for information about users. Under this arrangement, companies agree to let outside assessors determine their compliance with the guidelines and all members agree to promote common goals.
COALITIONS OF THE CONNECTED
Continuous innovation -- and the increasing population of the interconnected estate -- will pose new, difficult challenges for people and governments the world over. Even the best-informed and most active users of technology will find themselves caught in a blur of new devices and services. In an era when the power of the individual and the group grows daily, those governments that ride the technological wave will clearly be best positioned to assert their influence and bring others into their orbits. And those that do not will find themselves at odds with their citizens.
Democratic states that have built coalitions of their militaries have the capacity to do the same with their connection technologies. This is not to suggest that connection technologies are going to transform the world alone. But they offer a new way to exercise the duty to protect citizens around the world who are abused by their governments or barred from voicing their opinions.
Faced with these opportunities, democratic governments have an obligation to join together while also respecting the power of the private and nonprofit sectors to bring about change. They must listen to those on the frontlines and recognize that their citizens' use of technology can be an effective vehicle to promote the values of freedom, equality, and human rights globally. In a new age of shared power, no one can make progress alone.