Decentralization

December 19, 2020

Civilization is a perpetual a battle between centralization and decentralization. Centralized systems have a single point of failure.

Examples of centralized systems:

Examples of decentralized systems:

I do not distinguish between government and non-government entities. Political parties are centralized institutions with single points of failure. Using a political party to safeguard freedom against the government is not decentralization. "Decentralization" cannot be a political platform.

Bureaucracy is social technology for commodotizing human beings. An organization is a machine for standardizing human beings into interchangable parts. If you are a normal person then getting commoditized can be unobtrusive. If you are stupid, lazy and unmotivated then commoditization if often good for you. If you are an exceptionally capable person then commodization destroys the value you create, especially if you specialize in a high-leverage industry with long-tailed outcomes.

Centralization standardized human beings, which is almost always bad the exceptionally capable. I am an exceptional person. Centralization harms me so consistently that I have developed meticulous avoidance of it.

Last week I had to interact with Microsoft Teams and Apple's iTunes Connect in the same morning. It ruined my whole day. This isn't Microsoft's or Apple's fault. The engineers working at both companies areā€¦fine, I guess. The frustrating parts about interacting with their software came from how they interacted with government bureaucracies.

Is this the government's fault? I don't think so. By global and historical standards, my local government is among of the best. Blackouts are rare. The trains run on time. The currency is stable. I have never needed to bribe an official. There hasn't been a civil war or mass starvation in living memory. Complaining about minor inconveniences in enterprise software sets the bar unfairly high for an institution whose prime directive is the monopolization of lethal force.

The problem is one of centralization. Apple and Microsoft are monopolies. Monopolies are centralized systems; they are a single point of failure. With such a small number of major tech companies, my local government can compel them to do things against their customers' interests.

Governments are an information bottleneck. If Apple and Microsoft were not individual companies but, instead, giant networks of competing companies then the government could not supervise them close enough to interfere. Centralization creates systemic risk. If you are the kind of person who pays no attention to systemic risk then sure, go ahead and use centralized systems. If you an exceptional person then you can do better.