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What Comes after the Nation State? – Fractal Governance

by | Jan 5, 2015 | Business Trends

Thomas Frey Futurist Speaker what comes after the nation state fractal governance
In the beginning life was simple, just land and people. No borders, no restrictions, and no governments breathing down everyone’s neck.

Over time, cultures formed around a common language and geography determined many aspects of lifestyle. As an example, people who lived next to the sea oriented much of their life around fishing, while those further inland spent more time hunting and farming.

Traveling from one region to the next was difficult and dangerous. Before the time of Gutenberg’s printing press, the vast majority of people lived and died within 20 miles of where they grew up because they didn’t have access to reliable maps.

Later, as populations grew, we began to see the need for more sophisticated societies. At the heart of these advancements were cities adding conveniences like streets, water systems, protection from lawless individuals, and justice systems to add a sense of order to all those advancements.

As years progressed, cities banded together with towns and villages nearby to create better systems, form geographical boundaries, and promote common interests. These groupings of cities became countries, and governments sprang up to manage and organize their interests.

Countries were formed around a common geography, common languages, and common systems like currency and transportation.

The term “nation-state” came into play in 1648 with the treaty of Westphalia. This was an important turning point because countries transitioned from rogue protectorates to cultured political systems that recognized each others borders and were empowered to make deals with other nation-states.

Since 1648, countries, operating as nation-states, have become the most powerful entities on the planet. With large militaries to defend their interests and advanced monetary systems to build infrastructure, countries have become complex organisms with self-adapting properties.

However, when Internet started providing borderless connectivity, we began seeing national systems transition into global systems. As the need for borders became less clear, traditional ways of defining a country began to erode and the value of citizenship, less defined.

While countries struggle to maintain their role in the global community, people, as citizens of these nation states, are becoming far more mobile, wanting to be less confined by systems, rules, and geography.

So what comes next? Are we on the verge of yet another shift in global entities?

Understanding Where We’ve Come From

The nation-state will be 367 years old this year.

Political scientists have spent countless years refining the difference between the terms “nation” and “state.”

Generally speaking, a nation refers only to a socio-cultural entity, a union of people sharing culture and language (or languages).

A state refers to a legal/political entity that is comprised of: a) a permanent population; b) a defined territory; c) a government; and d) the capacity to enter into relations with other states.

Even though most leaders of countries today tend to oppose adding new nation-states to the mix because it disrupts the status quo, new entities pave the way for non-traditional thinking, new approaches to systems and infrastructure, and far more experimentation.

The Psychology of Borders and Reasons for Crossing Them

Borders create an un-natural impediment to the natural flow of human migration. People are both pushed and pulled across borders, and there are literally hundreds of reasons for each.

Some of the push factors include not enough jobs, poor living conditions, desertification, famine, political persecution, slavery, forced labor, poor medical care, war, loss of wealth, natural disasters, pollution, death threats, or desire for political or religious freedom.

Pull factors are similar but from a different mindset. They include things like more job opportunities, better living conditions, more political and/or religious freedom, better education and medical care, family connections, and better chances of marrying the right person.

Thomas Frey Futurist Speaker One in five people crossed a national border last year
One in five people crossed a national border last year

Six Ways in which Borders Have Become Less Meaningful

In 1950, 50 million people a year crossed national borders, last year it was 1.4 billion or nearly one out of every five people.

As numbers continue to climb, most customs and border patrol jobs will be automated out of existence. International rules based on corporate privilege like telecom’s roaming charges, tariffs, and tourism tax will soon lose their standing. Virtually every border-crosser has money, and the more welcome they feel, the more likely they will be to spend it.

Here are six ways that border significance will continue to decline.

1.) Global Awareness – As our access to the Internet improves, global awareness grows exponentially. Friends and family routinely post travel summaries on social media as they bounce from Kuala Lumpur, to the Tango Islands, to Aruba, and Timbuktu.

On the academic front, researchers who release reports in Moscow, Tokyo, or Singapore are having their finding read by people in Mexico City, Helsinki, and Belgrade ten minutes later.

This level of awareness is unprecedented and ripe with opportunity.

2.) Transitioning from National Systems to Global Systems – When we look at early systems such as written communications with Phoenician cuneiform, Mayan numerals, or the systems that had to be in place for engineering and building the Egyptian pyramids, it’s easy to see that system thinking has been around a long time. But global systems are a more recent innovation.

The most obvious advantage to global systems are the efficiencies they create. As an example, when a person who has spent their life hunting and fishing for food is able to walk to a store and purchase food, they suddenly have far more time in their life to do other things.

Similarly, when a company that has struggled to deliver product to the other side of the world can begin working with FedEx who provides painless global delivery, the company suddenly has time to focus on other critical problems.

Global systems now include currency exchange, stock trading, e-commerce, news services, postal delivery, voice and text communication, social media, time zones, measurement systems, GPS, mapping services, and the Internet.

Future global systems will include things like accounting standards for publicly traded companies, global currency (Bitcoin), genealogy systems, patent systems, ownership authorities for personal ownership, and standards for ethics.

3.) Language – Google Translate is an online service that does a reasonably good job. The system built by Franz Och at Google over the last decade can now support translation between 80 language pairs. In 2013, Google said that Translate served an average of 200 million people every day.

4.) Currency Networks – The 2009 introduction of Bitcoin was the first of many cryptocurrencies, each of which is pushing the transition from national to global currencies. What most don’t realize is that the wealth transferal networks created by cryptocurrencies is far more valuable than the currency itself. These currencies enable instant exchanges between national currencies (i.e. USD to Euro or Yen) with virtually no risk and very little expense.

5.) Global Transportation – In 2014 there were over 5.5 billion passenger flights around the world, a 4.9% increase over the year before. As air travel becomes more ubiquitous and available, we are seeing an increasingly fluid society

6.) Telepresence – For those who still find borders to be a painful barrier, telepresence has become the popular workaround. With near-perfect visuals and an in-the-room audio and sensory feel, this technology short circuits the cattle calls at the airport and replicates physical presence in virtually every way except for having a beer at a local pub afterwards.

“Transparency unimpeded will mean we will
eventually lose our ability to own things.”

Six Ways in which Countries are Becoming Dysfunctional 

Borders may be diminishing in value, but many countries still use them to insulate their people and mask what’s truly happening behind the scenes.

1.) Dysfunctional Laws – With every country adding boatloads of new laws, travelers face literally hundreds of millions of possible laws they can run afoul of.

2.) Technology Exceeds Competence of Government – Failures are showing up daily in areas ranging from identity theft, to corporate hacking, wall street scammers, botnets, banking fraud, pension raiding, and intelligence breakdowns.

3.) The Complexity of Privacy – As transparency grows, we begin to know everything about everybody including their credit card and bank account numbers. Transparency unimpeded will mean we will eventually lose our ability to own things.

4.) Multi-National Workforce – People who do work for businesses in more than one country face double and sometimes triple taxation.

5.) Lack of Checks and Balance – Abuses by too-big-to-fail banks, Wall Street quants, and corporate shenanigans that almost took down the entire global economy have yet to be accounted for.

6.) Technological Unemployment and a Declining Middle Class – Jobs are being automated out of existence at a record pace and those working in middle class workers are losing ground very rapidly.

These indicators along with countless more are pointing to massive failures in global governance and the prospects of civil breakdowns on the horizon.

Adding Artificial Intelligence to Government

We live in a human-run world and the idea of having machines replace politicians, taking an automated driving test, or sitting before a robotic judge all sound rather foreign to the way things are done today. But changes like this are right around the corner.

If we return a library book a few days late and a machine assesses a $2 fine, most people are okay with that.

Similarly, taking a dog to a robotic vet that does automated testing, diagnoses the problem, and prescribes a cure will come as a welcome relief to many.

But having an automated online policy wonk listen to seven hours of testimony from industry experts and synthesize an entire new referendum feels sinister and creepy. Yet systems like this will remove political favors from the mix, remove campaign contribution bias, and take lobbyists out of the equation.

Thomas Frey Futurist Speaker Paving the Way for Fractal Governance

Paving the Way for Fractal Governance

Using this preamble to set the stage, I will attempt to describe the type of entities that I envision evolving from our current nation-state.

Since technology is exceeding governments ability to manage it, new global systems, or fractals, will emerge to offer a solution. Each fractal will be highly automated, and come with its own management structure.

I refer to them as fractals because each of them represents a tiny bit of order in an ocean of chaos. As fractals catch on we will begin to see new patterns of governance emerge.

Fractals represent the intersection of national and global governance.

I’ll begin by describing the Privacy Fractal which will only deal with privacy issues, but it will manage these issues in every member nation it manages to recruit.

Starting with a “Geneva Convention on Privacy,” the organization will establish global guidelines to deal with legal definitions, establish limits, handle abuses, and develop monitoring tools to signal whenever there is a privacy breach that has occurred.

In much the same way ICANN is the global authority for naming and numbering systems related to the Internet, the Privacy Fractal will establish itself as the global authority on privacy.

Fractal Governance will serve as a checks and balance to national governance, but only in a very limited scope.

Fractal Governance Defined

A Fractal is a narrow spectrum of global authority managed by an independent organization that operates outside of the control of individual nations. Member nations will assign representatives to the Fractal’s advisory board but the organization will operate outside of the control of any one nation.

Some Fractals will be mandated by large international assemblies such as a G20 Summit while others will originate organically, recruiting member nations on their own.

Fractals will be funded through nation-based membership dues.

Once a Fractal reaches critical mass, somewhere in the range of 20 member states, there will be a tendency for it to serve as the default authority in all matters related to its scope of governance.

Thomas Frey Futurist Speaker Types of Fractal Organizations

Types of Fractal Organizations

The full range of possible Fractal Organization is only limited by our imagination, but the earliest ones will be those that address a specific problem for countries today.

Since countries don’t know how to deal with cryptocurrencies, we may see a “Cryptocurrency Fractal” mandated at the next G20 Summit. But that may be too broad of scope and a separate authority may be needed for Bitcoin, Litecoin, Dogecoin, and each of the cryptocurrencies gaining traction around the world.

With the concept of ownership being muddied by governments and police claiming authority to seize property, an “Ownership Fractal” may be needed to sort out all of the issues related to ownership around the world. Simply claiming rights based on the “spoils of war theory” needs to go away.

Fractal Governance will cover a wide range of topics from concrete to esoteric. Here are a few to help stimulate your thinking:

  • Global Accounting Standards
  • Business Ethics
  • Time Zones
  • Nanotech Measurement Standards
  • Incarceration Fractals
  • Ocean Pollution
  • Asteroid Mining
  • Marijuana Policy
  • Language Archive
  • Patent and Intellectual Property
  • GPS
  • Cross-Border Taxes
  • Telepresence Networks
  • Identity Standards
  • Wind Rights

Over time, turf battles between nations will be replaced by turf battles over the range and limits of Fractal authority.

Final Thoughts

There are many benefits to having separate countries around the world. They can preserve cultures, help spawn new industries,

But the biggest benefit is the competition that takes place between countries. This competition is pushing our standard to living to increasingly higher levels.

Done correctly, countries will welcome many aspects of fractal governance because it demonstrates attention to growing problem areas. People will have confidence in these expert-run systems as opposed to the political generalists, with lobbyists in the background, that are making decisions today.

Admittedly, this is a half-baked idea at best. These descriptions are crude and the overall concepts still rough. Does this sound like the direction we’re headed or am I way off base? For this reason, I’d love to hear your thoughts.

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