Since the early days of the industrial revolution, national governments have been closely tied to information technologies (IT), driving technological development and using them to pursue the business of governing. For example, revolutionary France funded the construction of an optical "telegraphe" network in 1793, to speed up military communications and permit Paris to exert greater control over what was then a huge country. Similarly, the roles of the U.S., British, and Soviet governments in the early development of electronic digital computers are well known. Conversely, the pioneering work of Charles Babbage in the 19th Century languished after the British government failed to fund construction of his machines. But just as governments affect the development of IT, so too does IT influence the development of governments.
Until fairly recently, commentators on technology and society argued that IT would enable the development of omniscient, omnipotent central authorities that would control every aspect of civil life. The best illustration of this view may be George Orwell's classic novel 1984, in which two-way television monitors the protagonist's daily exercise, and the state, symbolized by "Big brother," uses its control of IT to rewrite history to support the rulers' goals [11]. Orwell's real-world prototype, the Soviet Union, pursued visions of large-scale cybernetic control and centralized economic planning into the 1980s. Even today, polls indicate the U.S. public fears the government's accumulation of personal information, and some observers see Singapore as an emerging model for strong forms of IT-based control over populations.
More recently, observers have argued that rather than empowering national governments, IT may weaken or even contribute to the ultimate demise of the nation-state. These observers, including Walter Wriston, the former chairman of Citibank, and Jean Marie Guehenno, former French Ambassador to the European Union, have argued that the diffusion of IT has given people the ability to obtain information, communicate, organize, and conduct economic and political transactions without regard for borders and beyond the control of national governments [6, 14]. At the recent World Economic Forum in Davos, Switzerland, John Perry Barlow, vice-chair of the Electronic Frontier Foundation (EFF), prophesied that as more of business and daily life takes place in cyberspace, national governments will find themselves unable to govern, and "The nation-state is doomed . . . and ought to be."[4] Or as Bill Frezza, founder of the libertarian DigitaLiberty organization, has written: "When the combined might of nations tries to chase society's producers of goods and services down the information superhighway, making claims on the fruits of their labor, they will simply disappear into the ether."[2]
These polar images illustrate the tension that arises from the development and diffusion of IT, as it empowers both state and nonstate actors. Like other revolutions, the "information revolution" will have winners and losers. Some institutions will prosper, others will vanish, but few will be unaffected. In this changing environment IT weakens national governments in some ways, but they are not vanishing. IT increases some governmental capabilities, and a government may leverage its jurisdiction over the physical world into influence over the cyberworld.
The nation-state has been the fundamental unit of organization in the international system since before the industrial revolution. Nation-states are characterized by a central authority with political power over a discrete geographical territory, a claim to the allegiance of that territory's population, and the sole capacity to represent the territory in relations with the similar entities that control other territories. Not all states govern themselves identically, of course, and some, such as Somalia, are states in name only. But states' governments share a core set of functions, including defending their territory and citizens against foreign threats; maintaining domestic order; playing some role in the domestic economy, particularly in creating national economic and physical infrastructures; and extracting wealth (through taxes) to support their activities.
On first glance, IT would appear to reinforce state power as it helps states work more efficiently and perform new tasks. For example, IT enables a central government to manage widely scattered troops or bureaucrats, helps health officials to track the spread of disease, allows law enforcement to search vast libraries of fingerprints and other data to solve crimes, and supports a state's attempts to monitor a national economy or take a census. Nevertheless, the diffusion of IT may undermine a state's ability to control events within its borders.
In Orwell's Oceana, the archetypal totalitarian state, IT was critically important to the state's efforts to control information. It was used to indoctrinate citizens, restrict the information available to them and outsiders, and monitor behavior. Such control objectives are not unique to authoritarian or totalitarian regimes, although they are the most dedicated practitioners. Rather, all states, from the most liberal to the most authoritarian, try to regulate communications of some kind or another, for purposes ranging from the prevention of child pornography or political or religious dissidence to the protection of their citizens from crime, fraud, or invasion of privacy. Because money has become notional, rather than physical, these communications also include financial transactions, which may occur so quickly, on such a geographical scale, and in such volume as to shock currency or stock markets.
The Orwellian view underemphasizes the effects of the broad diffusion of IT, particularly into the private sector. Where it is available, modern IT permits rapid, inexpensive, widespread communication even across national boundaries, and gives individuals access to tremendous amounts of information, including information formerly available only to a few governments, such as satellite imagery. As this volume rises, and as technologies such as encryption spread, data and transactions could evade government monitors, defeating, or at least subverting, efforts to enforce government policies and laws. Space constraints permit us to consider briefly only two of the subject areas in which IT affects governments' abilities: taxation and money laundering, and the flow and control of ideas.
Without the ability to tax, the modern state cannot support its personnel and activities. IT challenges that ability, as it permits international, instantaneo us fund transfers, potentially cloaked by anonymity and encryption, that could hinder governments' efforts to discover what people are doing with their money, or to reach the assets and transactions that they need to tax. Barlow has proclaimed that digital cash will rearrange the financial world and "taxes will become voluntary."[8] Money laundering, a $300 billion annual global industry, may also be aided where funds can travel around the world instantly and anonymously, so that they cannot be traced. This mobility diminishes governments' abilities to interfere with money flows to adversaries such as rogue states or international organized crime [12, 13].
IT may enhance countries' abilities to establish themselves as havens for tax avoidance, money laundering, or similar activities. Anonymous, untraceable "E-cash" may exacerbate the difficulties that tax collectors and law enforcement authorities already face in the bank confidentiality of nations such as the Cayman Islands, Lebanon, Morocco, or Thailand. For example, in December 1995 the Seychelles enacted an Economic Development Act that grants citizenship, including absolute immunity from extradition or asset forfeiture, to anyone investing $10 million there. As it establishes a banking system with secret numbered accounts and wired into the world financial system, that nation might expect an influx of electronic money and new citizens [2, 13].
For some states, the most challenging aspect of the diffusion of IT is the flow of ideas it promotes. Television, broadcast by satellite, can disseminate news and culture viscerally and instantly. Computer networks, especially the Internet, permit anyone to broadcast political or religious messages widely at little marginal cost, and may help individuals to form groups or to act in concert.
The unfettered ability to communicate may particularly threaten authoritarian or totalitarian regimes, such as the Soviet Union, Iraq, or North Korea, whose survival depends upon their ability to control the information their citizens and others receive. The mere fact that dictatorships strive to control their nations' means of communications indicates the significance of these means, and they probably contributed to the Soviet Union's ultimate collapse. The survival of the Soviet state depended in part upon its ability to control what its people knew about their country and the outside world and what outsiders knew about the USSR. Developments in IT undermined both aspects of that control [14].
IT also aids dissidents' efforts to organize, communicate, or proselytize, even from beyond a nation's borders. While Ayatollah Khomeini was in exile in France during the 1970s, he preached to the Iranian faithful through audiotaped sermons smuggled into Iran. During the 1989 antigovernment demonstrations in Beijing's Tiananmen Square, demonstrators communicated with each other and outside supporters via fax. Leaders of the Zapatista rebels in Chiapas issue orders and agitate against the Mexican government both within Mexico and before the world media through email. The Internet has enabled the establishment of virtual communities for citizens and expatriates of nondemocratic Middle Eastern and Asian countries.
The explosive diffusion of IT makes this flow of information difficult for governments to control. As John Gilmore, founder of Cygnus Support and the EFF, has noted, "The Internet interprets censorship as damage and routes around it." [9] Information can be stored at multiple "mirror" sites, beyond the reach of an individual national government; its source may be disguised; and it may be encrypted beyond a government's practical ability to decode. Anonymous remailers can strip the return addresses from email messages, making it difficult, if not impossible, for authorities to determine their sources. Furthermore, where a government blocks one route of access to forbidden information, computer users may easily find another. A German, for example, could use the "Great Web Canadianizer" to circumvent his government's blocking of a Californian Holocaust-denial World-Wide Web site by having the Canadian site copy information from California to a server in Canada and only then send it into Germany [5, 7]. Similarly, when the French government blocked the sale of a book detailing its late President Francois MitterandOs misrepresentations about his health, the book's contents soon appeared on Web sites outside France. The Resilience of the Nation-State
Despite some prognostications, the state is not sublimating quietly, if at all. Consciously or unconsciously, motivated by stubbornness, institutional inertia, or real desires to serve and protect their businesses and citizenry, governments are maintaining or expanding their roles.
The information revolution has not fundamentally changed most of the objectives that the nation-state serves, as they occur mainly in the physical world, rather than in the cyberworld. Sovereign governments are still the primary actors in international affairs, and they interact to address problems relating to trade, pollution, the allocation of the electromagnetic spectrum, and other issues. National armed forces still defend borders, or project force beyond them. States set health and safety standards, build and repair transportation systems and regulate traffic, enforce civil order, provide welfare services, and provide courts for the settlement of disputes. Few of these missions appear likely to disappear or to be taken up by any other entity soon.
While people live in the physical world, demands for national government will probably persist. To the extent IT adds to or improves functional capabilities, extending the reach of official agencies or improving their efficiency, these technologies may strengthen governments in traditional areas.
Ironically, the growing IT-enabled power of nongovernmental entities, such as multinational corporations or the news media, has put additional demands on national governments, most notably that of protecting their citizens' privacy. For example, after a newspaper published a video store's records of Judge Robert Bork's movie rentals while the Senate was considering his nomination to the U.S. Supreme Court, public outcry prompted Congress to enact the Video Privacy Act to prohibit such disclosure. Other laws regulate business practices and disclosures by credit bureaus, cable companies, and hospitals. More ambitiously, many European countries, including Spain, France, Denmark, and the U.K., have omnibus privacy or data protection acts, and the European Union has enacted an omnibus data protection directive [1].
Although IT can make organizations leaner and more efficient, it can also drive governmental efforts to create new bureaucracies, or expand old ones, to address new challenges. Already the U.S. and dozens of European and Asian countries have created their own committees examining policies relating to national and global information infrastructures. The government of the People's Republic of China (PRC) seems to be establishing a new group of bureaucrats to monitor the Internet, and Singapore may expand its Broadcasting Authority to implement an Internet service and content provider registration scheme [3, 10]. Indeed, as governments perceive that diffusion of IT threatens their authority, they may expand the corps of officials who address the threat, just as the drug scourge has driven expansion of U.S. law enforcement agencies.
States are not passively letting their powers ebb in cyberspace; rather, many governments are trying to use the new technologies to maintain their positions. Although the fate of such efforts is uncertain, some governments are creating controlled information environments. The PRC, hoping to take advantage of network connectivity while minimizing the risks, is attempting to build a national "intranet" that it will protect from dangerous outside influences by limiting access to forbidden communications [3]. Similarly, the Organization of the Islamic Conference wants to create OICIS-NET, a protected network to connect 51 countries that will carry material deemed suitable for Muslim sensibilities.
Additionally, where they might once have tried (or continue to try) to suppress opposing points of view, some states are using the Internet to participate in the marketplace of ideas. Officials in Indonesia and Singapore, for example, respond to Internet criticism of their respective governments, and several nations, including the U.S. and South Africa, operate Web sites for government information.
Despite the difficulty in controlling the flow of bits through and around nations, governments may be able to "bootstrap" their control of the physical world into some control over the electronic one. This may take several forms. First, governments control the land over or under which the information conduits must pass, and they may set conditions for network construction or operation.
The government of Pakistan, for example, will require operators of cellular telephone systems to install monitoring devices in their systems as a condition of licensing. Even wireless satellite communication is subject to control; a government may ban or regulate the equipment necessary for its citizens to receive broadcasts, as Iran, China, and others have attempted. Particularly where little electronic infrastructure exists, an aggressive central government may regulate what is built, and it is relatively easy to monitor a handful of Internet gateways. The PRC or Vietnam may thus have a better chance of controlling what enters or leaves their countries than would the U.S. Extreme isolationists like North Korea and Myanmar, or a country like Guyana, which has announced plans to monitor the Internet before it has any full gateway and to prohibit unauthorized installation of Internet service, have at least temporarily succeeded in their own draconian ways.
Second, governments may control information through their ability to permit or forbid companies to do business within their borders. The PRC forced Rupert Murdoch to remove the BBC from his Star TV satellite broadcasts into its country, as well as Taiwan and Hong Kong, before it would permit him to operate in China. Similarly, European prohibitions against the transfer of personal data to sites without adequate safeguards are given teeth by the respective governments' ability to prevent violators from doing business within their jurisdictions [1]. Governments could thus also require that financial institutions keep records or structure transactions to improve their visibility to tax collectors.
Third, a government's ability to assert jurisdiction over people and corporate assets may give it influence over what individuals and companies do even beyond its borders. Bavarian prosecutors' concern about child pornography, for example, prompted Compuserve to cut off access to 200 Usenet newsgroups for all of its subscribers, not just those in Germany. Similarly, the Singaporean government's threats of libel suits in its own courts have reportedly inhibited the New York Times and the Washington Post from running critical articles in their globally distributed International Herald Tribune [1].
Fourth, communications are subject to the danger of the "unreliable ear," (a U.S. legal doctrine whereby one party to a conversation bears the risk that another party has consented to governmental monitoring) as they all have at least two parties. As Benjamin Franklin observed, "Three may keep a secret, if two of them are dead." Senders cannot be certain that a government will not read even their invincibly encrypted communications, either because the recipients are government agents or because a government can make those recipients' lives miserable. Similarly, those seeking to hide income or other transactions need the cooperation of banks and business partners, but governments can reduce these entities' incentives or abilities to cooperate.
Finally, although states may provide sanctuaries for those whose activities might threaten other states, that ability is not unchallengeable. Other states can apply pressure to those who shelter threats, through means ranging from economic sanctions to military force. As soon as the Seychelles enacted its Economic Development Act, developed nations began to lobby for the Act's amendment or repeal, threatening to withhold foreign aid [13].
This year, too, Great Britain tried to appease Saudi Arabia, a major trade partner, by ordering the deportation of a Saudi dissident who was using the Internet and other media to agitate against the Saudi royal family. (British courts subsequently blocked deportation.) More drastically, when the Mexican government was unwilling or unable to try or extradite a Mexican citizen who had participated in the murder of a U.S. drug enforcement agent, the U.S. government abducted him and tried him in the U.S.
For now, at least, IT is causing neither a sweeping aggrandizement nor a precipitous decline of the nation-state. IT supercharges people's abilities to communicate and gain access to information, perhaps beyond government control. Yet it gives governments new capabilities and does not replace their traditional functions in the tangible world, as people still expect and demand functions that only states are equipped to provide. These expectations and demands give national governments some opportunity to bootstrap control over atoms into control over bits.
But expectations can change, and IT may help to change them. As IT promotes communication among people, without regard for national boundaries, and as governments must address the resulting transnational challenges, perhaps people will transfer allegiances and expectations to something other than the nation-state, or perhaps IT, coupled with the continuing integration of the world economy, will enable a decentralization of governmental power. Conversely, a small world may not be a friendly one; cyberspace could be a place where people meet, get to know, and hate each other, or where ethnic or other subnational or transnational groups organize themselves.
Global networking may thus facilitate political and other forms of fragmentation, perhaps making it harder to maintain any form of diverse, geographically bounded, civil society. Neo-Nazi and other hate groups in the U.S. and Germany, for example, organize and communicate across the Internet, and ethnic hate radio encouraged or perhaps even triggered the recent genocides in Rwanda and Bosnia. It would be unfortunate if IT contributed to the demise of Big Brother, only to help nasty Little Brothers take his place.
We would like to thank Stewart Baker, Michael Barletta, Avron Barr, Marjory Blumenthal, Ann Danowitz, Melanie Greenberg, Edward Roche, Kevin Soo Hoo, Ross Stapleton-Gray, Shirley Tessler, and Peter Wolcott for their constructive reviews.
Readers are encouraged to send comments, suggestions, anecdotes, insightful speculation, raw data, and articles on subjects relating to international aspects of IT. Correspondence should be addressed to:
Sy Goodman, CISAC, 320 Galvez St., Stanford University, Stanford, CA 94305-6165, Fax: 415-723-0089.
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7. Http://www.io.org/~themaxx/canada/can.html .
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11. Orwell, G. 1984. New American Library, New York, 1981.
12. U.S. Dept. Of State, Bureau for International Narcotics and Law Enforcement Affairs. Office of International Criminal Justice, Winter 1996, 4- 5.
13. U.S. Dept. Of State, Bureau for International Narcotics and Law Enforcement Affairs, International Narcotics Control Strategy Report, Mar. 1996 496-503, 581-582.
14. Wriston, W.B. The Twilight of Sovereignty. Macmillan Publishing Company, New York, 1992.