by Don Tapscott
Streaming Open and Trusted Data
Perianne Boring, founder and president of the Chamber of Digital Commerce, champions the idea that distributed ledgers open up government for the better. To her, “Blockchain enables radical transparency because it provides everyone with provable facts. Anyone can view any transaction that has ever happened on the blockchain.”25
Governments can easily provide data that others can use for public or private good. This differs from so-called Freedom of Information legislation where citizens must request access to important government information. Rather this involves the release of assets—actual data. Governments could release thousands of categories of data in raw format, stripped of personal identifiers: traffic patterns, health monitoring, environmental changes, government property, energy usage, government budget and expenditures, expense accounts. Citizens, companies, NGOs, academics, and others could analyze these data, put them into applications, map them, and otherwise use them for, say, understanding consumer demographic trends, researching patterns in human health, or knowing whether the bus is going to be on time.
As of August 2015, the U.S. government has already published 165,000 data sets and tools on its Open Government Web site.26 The U.S. government’s philosophy that government-held data is public data has made it a pioneer in transparency. Other governments are following suit. As of August 2015, the U.K. government has released 22,000 data sets.27
Releasing data through peer-to-peer networks and the blockchain will introduce even greater levels of efficiency, uniformity, utility, and trust. Making data public is an incentive for ensuring data accuracy. People can view and flag data when they find an error or can prove that data have been altered or corrupted.
If you register a complete data set in a blockchain network, then the network can log additions and changes to the data set and can block efforts to tamper with the data. No need for a central administrator. Governments could release more programmatic data to help the public and analysts understand these programs and their impact.
Partnering to Create Public Value
We’ve already seen how simply making more trusted information available can be used for positive economic and social value, and how individuals and communities can be empowered to improve their own lives. Blockchain-enabled peer-to-peer networks will require us to rethink how we divide responsibility in creating public value. When governments publish raw data, they become a platform on which companies, the civil society, and other government agencies and individuals can self-organize to create services. We have used “pay for success” models for a few years now to engage businesses in solving civic problems. For example, the U.S. Department of Labor funded initiatives that hire ex-offenders and reduce recidivism, and the City of Chicago raised education levels among disadvantaged preschoolers.28
This model also encourages innovation and incentivizes achievement of desired results by releasing funds only when these results have been achieved and are measurable. Think about the power of ongoing micropayments to a small not-for-profit group working in a community on sustainable energy initiatives. A government program could link funding to actual declines in consumption. The not-for-profit group could support itself without having to rely on complex paperwork for reimbursement and might even secure financing based on the government’s commitment to its participation in the “pay for success” model.
Pegging Smart Social Contracts to Political Reputations
Just as the bitcoin network uses blockchain technology to constantly ensure the integrity of payments, government networks can use blockchains to ensure the integrity of their transactions, records, and important decisions. Officials can’t hide “off the book” payments or other government records, including e-mail records, decision logs, and databases. Whereas security often derives from fences, walls, or a perimeter of protection, the blockchain protects against tampering from both inside and outside. Therefore, it keeps “honest people honest.”29
Transparency is crucial for changing the behavior of an institution. While we of course cannot force these values and behaviors on our public representatives, we can limit their decisions and actions through smart contracts that define their roles and responsibilities as our representatives and then monitor and measure them on the blockchain.
Remember, smart contracts are self-executing agreements stored on the blockchain, which nobody controls and therefore everyone can trust. Political factions such as the Grand Old Party could use them so that candidates like Donald Trump who use their party infrastructure to debate and campaign during primaries couldn’t run as independents in a general election. We could apply smart contracts to different government operations (supply chain, external legal services, pay-for-success contracts) and even more complex roles of government and our elected representatives. We do foresee peer-to-peer networks tracking an elected official’s commitments and his or her fulfillment of these commitments. Watchdogs already do this through formal and informal peer networks on the Web.
While this approach could not apply to everything we expect from our political leaders, we could use it for all manner of specific commitments and actions. While measurement of eventual outcomes will be more of a challenge (e.g., results achieved with money spent), over time we will build experience and expertise with indicators so that we base our assessments on facts rather than current spin. This is not pie in the sky—in London, a candidate in the 2016 mayoralty campaign is calling already for the use of the blockchain to hold elected officials accountable for public business.30
Regulators could implement blockchain processes as a verifiable means to track the commitments of regulated industries in real time, assessing whether they are following through on promises made (e.g., investments in sustainable energy) or complying with regulated practices (e.g., on-time delivery, safety targets). While publication of key performance indicators and results on public Web sites is increasingly common, the blockchain would enable these processes to be automated and guaranteed accurate when applied to measurable results.
The data generated by these processes ensure that the public is constantly aware of who is behaving with integrity. How often did he show up at meetings? How did he vote? Did he abide by his commitments to do such-and-such? Who donated to her political campaign? Who violated the terms of her smart contract? Elected officials and those regulated must honor their commitments or explain why they haven’t. It also provides feedback to the electorate on whether their demands as constituents are reasonable and fair, not reactionary. Voters often want more services but lower taxes, or more factories but not in their backyard, or lower prices but higher wages. As such, open data provides a means of understanding trade-offs and increasing the accountability of all participants.
THE SECOND ERA OF DEMOCRACY
While representative democracy is complex and varies globally, one thing remains constant: passive citizenry. To date the discussion has focused on how blockchain technology can help create the conditions for fair, secure, and convenient voting to occur. To be sure, we have big opportunities. Online voting based on the blockchain would enable citizens to give their views more often. But attempting to replace representative democracy would be a mistake. “Motions put to a vote are usually well refined distillations of large and complex issues. They result from a long process involving conflicts, contradictions and compromises. To understand a motion and to vote responsibly, citizens need to participate in some form of refining process,” Don wrote in The Digital Economy more than twenty years ago.31 However, if we understand the contours of a new model, we can see how blockchain technology can help far beyond voting.
Technology and Democracy: Not a Happy Story
How has technology affected democracy? Surprisingly, the story is mixed at best. Television arguably degraded democratic discussion, turning what Al Gore called “the marketplace of ideas”32 into a one-way dialogue. Add equally toxic cable news—where talking heads win ratings by attacking opponents rather tha
n discussing ideas—and you’ve got stupefying battles of extremes. As the fictitious news anchor Howard Beale in the film Network said, “I’m as mad as hell and I’m not going to take this anymore!”
So far the Internet hasn’t changed democracy for the better. If anything, with increased surveillance and infringement of privacy on the pretext of national security, democratic governments are behaving more like authoritarian regimes. We’d like to focus on three particular challenges.
1. Fragmenting Public Discourse
Al Gore hoped the digital age would reverse the tide of negativity eroding our basic institutions. “The greatest source of hope for reestablishing a vigorous and accessible marketplace for ideas is the Internet.”33 He was not alone. We have long argued that as the Web extends in usage, resources, and connectivity, increased access to factual information would improve the quality of public discourse.
However, the opposite seems to be occurring: balkanization of perspectives and exploitation of the new tools by ideologues who organize into battalions. Today as content production becomes more distributed and the sources of information and opinion proliferate, anyone can present a certain view and attract a like-minded audience, which may be small but may also be zealous.
The new communications and data analysis tools have also allowed ideologically driven groups to hijack social and political debates. Both liberals and conservatives are using them to create echo chambers that undermine the potential for compromise, let alone consensus.
2. Scaling Ignorance on the World Wide Web
Just as people can’t tell a person from a dog on the Internet, they can’t always discern the truth. Conspiracy theorists popularize their antievidence views in days or even hours,34 most recently those around the crash of Malaysia Airlines Flight MH370. Consider that three in ten Americans now believe that human beings have existed since the beginning of time.35 And despite overwhelming scientific evidence that carbon emissions threaten life on Earth, those with short-term vested interests have effectively denigrated the science and blocked intelligent discussion, let alone action plans. Those using the Web to further ignorance and denialism are outgunning scientists and rationalists. Internationally repressive countries from Iran to North Korea are creating private, restricted versions of the Internet for their citizens, making the Web an ever more powerful tool to trump rationalism with ideology.
3. Complicating Policy and Implementation
In the predigital era, enacting and enforcing policy was less complicated. Policy specialists and presidential advisers had strong command of the issues. Today they can barely keep pace with defining the problems, let alone crafting the solutions or explaining them to the public. So bad is the problem that President Obama signed into law the Plain Writing Act of 2010 requiring federal agencies to use language the public can understand.36
Today, many unforeseen issues arise between elections. No government can credibly assert that it has a voter mandate to take specific actions on all pertinent issues. Moreover, governments lack sufficient in-house policy expertise on many issues. So even if a government commissions an opinion poll to discern the public’s view, the polling process doesn’t tap into the wisdom and insight that a nation’s citizens can collectively offer.
Putting Democracy on the Blockchain
All of these problems suggest a new model of democracy that emphasizes public discourse and citizen engagement. Let’s not confuse civic engagement with notions of so-called direct democracy where we all watch the evening news and vote on public hangings via our mobile devices or interactive televisions. Citizens don’t have the time, interest, or expertise to become informed on all issues. We want reasoned opinion, not just any opinion. We still need legislative assemblies to debate, refine, and resolve issues.
But surely a more collaborative model of democracy—perhaps one that rewards participation such as the mining function—could encourage citizens’ engagement and learning about issues, while at the same time invigorating the public sector with the keen reasoning the nation can collectively offer. Could we create a culture where people are turned on by the democratic process, not turned off by their representatives’ abuse of their seats?
Why has this not occurred to date? The main problem is not a technological one. Most politicians, regardless of political stripe, seem to care more about winning elections than about solving the crisis of legitimacy through citizen engagement.
Let’s start with the basics. The most fundamental process for representative democracy is the election. Voting is the right (and in some countries, like Belgium, the responsibility) of all eligible citizens in a democracy. Yet around the world elections are deeply flawed. Corrupt officials tamper with results or outright rig them. Voting can be suppressed using everything from lack of access to bribery and intimidation. Manipulating elections is a complex business but it’s done almost everywhere. Could blockchain technologies help improve the voting process?
For all our technological advances, the mechanics of voting in elections have remained largely unchanged for hundreds of years. In many parts of the world, to cast your vote you go to a polling station, identify yourself, mark a paper ballot, put it in a secured box, and wait for human beings to count the ballots.
Electronic voting (e-voting) is a term for voting with the aid of any electronic system. E-voting has, in many cases, proved as unreliable as manually tallied votes. E-voting today suffers from three problems: attacks on the software and hardware, mistakes or bugs in the coding, and human error. In 2004, a voting machine aiding in the general election in North Carolina was accidentally set to store only 3,000 votes. It irrevocably lost 4,438 votes in a race that was decied by a difference of only 2,287.37
BLOCKCHAIN VOTING
How might voting on the blockchain work? Imagine the board of elections creating digital “wallets” for each candidate or choice, with approved voters allocated one token or coin each for each open seat. Citizens vote anonymously through their personal avatar by sending their “coin” to the wallet of their chosen candidate. The blockchain records and confirms the transaction. Whoever ends up with the most coins wins.
Some have tried to solve the problem of trust by using end-to-end auditable voting systems. Votes are typically made via kiosk, which produces a cryptographically authenticated paper record of the ballot but allows votes to be counted electronically.
CommitCoin uses cryptographic proof-of-work systems to prove a message was sent at a certain date. The inventors, Jeremy Clark and Aleks Essex, say we can use it to prove the integrity of election data before the event, as a means of “carbon dating commitments,” providing a baseline to counteract fraud and error.38
End-to-End E-Voting Systems
Citizens are making advances all the time. In 2015, academics from the National and Kapodistrian University of Athens published a paper introducing DEMOS, a new end-to-end (E2E) e-voting system verifiable in the standard model, without reliance on setup assumptions or access to a “randomness beacon.”39 It uses a distributed public ledger like the blockchain to create a digital ballot box that citizens can use to vote from anywhere in the world.
An E2E verifiable election detects election authorities who try to misrepresent outcomes. Voters cast ballots in exchange for receipts that allow them to verify that (a) their vote was cast as intended; (b) it was recorded as it was cast; and (c) it was counted as it was recorded. An external third party could verify the election results. Voters still must accept setup assumptions and take a leap of faith on the election results.
With DEMOS, the voting system generates a series of randomized numbers.40 Voters get two sets of numbers, or keys: one corresponding to them, and one to their preferred candidate. After the encrypted vote is cast, it’s sent across multiple servers. Results are published to a bulletin board publicly displaying all the information related to the election.
Neutral Voting Blocs
In Australia, an organization called the Neutral Voting Bloc (N
VB) is using voting on the blockchain to revolutionize democracy in another way entirely. They have a unique approach to government, and it’s optimistic: “We believe the best way to fix politics is to participate ourselves.”41
Founder Max Kaye describes NVB as a “political app” where interested citizens can register their opinions on policy issues by “voting” on the blockchain. Once the time is up, the final tally instructs elected officials on how to vote in governmental proceedings. When asked, why are you using the blockchain? Max Kaye replied, “Because we intend to facilitate a variety of parties, some of them will necessarily disagree strongly. To maintain integrity we need each party to be able to independently verify the voting record, and each vote.” Furthermore, Kaye suggests there are anticensorship properties, and immutability. He said, “The only electronic structure on the planet I’m aware of that can do this is the bitcoin network. (Although there are other blockchains, they are not immutable enough because their hash-rates are so low).”42
Protecting the Voters
Voter intimidation can take a violent turn. In Zimbabwe, the party opposing Robert Mugabe withdrew from the election when coercion from supporting militias had become too lethal. The elections were carried out anyway—Mugabe won. While technological advances always come with people who exploit them to their own advantage, some are beginning to say that blockchain technology could eradicate corruption in places such as Asia.