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The Internet Revolution

  • Matthew R Estabrook,
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Johann Gutenberg’s invention of movable type printing enabled ideas to be circulated widely and cheaply for the first time. This free flow of ideas was a critical catalyst for the Protestant Reformation. In the 1980s the desktop computer and fax machine played an important role in the process that led to the breakup of the Soviet Union.

Today, thanks to the Internet, technology may be bringing on another information revolution. I n 1995, Time magazine reported that some Iranian scholars have gained access to the Internet, exposing them for the first time to the ideas of Shakespeare, Mill, and other Westerners. Iran’s government may find it increasingly difficult to contain this information flow.

Today, what we call the Internet is a vast “meta-network” of 50,000 computer networks in 90 different countries.

Thirty million people access the Internet through telephone lines and personal computers, send electronic mail, download computer software, buy products, and gather news and information. The number has been increasing about 10 percent each month.

The Internet provides not only access to information and ideas, but the power to distribute them as well. Gutenberg’s printing press reduced the costs of sharing information a thousand fold. Innovations such as the photocopier and more desktop publishing have further reduced these costs, enabling even individuals to produce professional documents inexpensively. The Internet takes this information revolution even further; now, one doesn’t even need paper to publish his ideas widely. Empowering people in this way has reduced the influence of the traditional media. For years, information on world affairs came from a limited array of sources: the Big Three networks, a few national radio syndicates, and several large newspapers and news services. That has begun to change. Cable brought with it CNN and C-SPAN, and a host of other stations that cater to the varied tastes and needs of segments of the population. Talk radio has emerged as a new forum through which people can express their views. And now the Internet, with its host of real-time chat conversations. E-mail lists, and news groups, offers new ways for people to share information

The Internet also allows each individual to choose his own community. Typically, when we think of community, we think of the people who live in our apartment building or neighborhood, but the Internet allows us to converse with whomever we please. Technology makes it almost as easy to communicate with someone in Japan as someone around the block. The Internet has therefore fostered the growth of new, virtual communities that are not bound by arbitrary physical borders, but by common interests, goals, and values. For example, the Internet proved the only effective channel of communication between survivors of Kobe earthquake in Japan and their friends and families around the world. In the United States; several pages emerged on the World Wide Web hours after the Oklahoma City bombing, documenting the destruction, and offering help and support to those in need.

Perhaps most important, the Internet is providing the means for ordinary citizens to subvert long-existing power structures, especially the taxes, tariffs, and regulations imposed by governments. As businesses rely increasingly on human capital (knowledge and information) and less on physical capital, tariffs become increasingly irrelevant. Likewise, entrepreneurs may establish banks and investment firms wherever the tax and regulatory burdens are least oppressive, and continue to serve customers anywhere in the world.

Lofty purposes? Not always, but the Internet, by facilitating the spread of information, is restoring power to individuals to make choices that affect their own lives and undermining outside interference in the process. How will governments respond to this rapid decentralization of knowledge and power? Perhaps they will be forced to compete with one another to create friendlier environments for trade. The result could he governments with simpler, less burdensome regulations and taxes.

This may not he far-fetched. After all, government regulation is likely to run at least a step behind an adaptive order that taps the knowledge of all its participants. That would be another information-based revolution.

  • Matthew R Estabrook

Mr. Estabrook is Manager for Education and Training at the Center for Market Processes in Fairfax, Virginia.

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