Full text from the
April-May 1995 issue
of The Last Ditch
"Only an 'opeless fancy ..."
The 1984 Palimpsest
and salvation via technology
By RONALD N. NEFF
Una salus victis nullam sperare salutem.
Aeneid, Bk. II, line 354
Let me not be misunderstood. It gives me no pleasure to think that the modern state has become for all intents and purposes invincible or to think that it will probably remain so for many generations. And in thinking that, I am not counseling despair. But no useful action can be taken to promote or preserve one's values without an accurate appraisal of the nature of the context. When I say that political action is useless, it is not because I want to sit in the sea and be devoured by leviathan. It is because I should very much like to see all the ingenuity and intelligence that go into useless activity turned to something productive, or at least less destructive.
At one time there were pro-technology, machine-worshiping socialists who believed that industrialization had made socialism possible ("The problem of production is solved; there remains only to solve the problem of distribution"). More recently, those whom Murray Rothbard used to call the libertarian Luftmenschen have been telling us for years that various science-fiction technodevelopments would ultimately render the state monopoly of services unnecessary, that future developments would make smooth the now-rough paths in the free market. Thus, in a discussion of how roads might be operated in a free market without toll gates every mile, one might find a sentence like: "A special computer-linked radio receiver could record the entrance of cars onto a highway."
Comes now Peter Huber in Orwell's Revenge: The 1984 Palimpsest to argue that telecommunications sets in motion a dynamic throughout society favorable to freedom, that it is another genie that cannot be rebottled. But Huber is no Luftmensch.
Understanding the subtitle of Orwell's Revenge is just the beginning of understanding what Huber has done: he scanned the complete works of George Orwell into his computer, and using Orwell's own words he has rewritten 1984, giving it the happy ending many of us more or less hoped for when we read it for the first time. He cheerfully rearranges scenes and imports from other Orwellian works. The way he turns scenes on their heads is a delight, and he's not bashful about tossing in some in-jokes from clandestine subcultures or rewriting lyrics to Beatles songs to adorn his point. Interspersed with the fantasy is Huber's commentary about what Orwell understood and what he missed.
The happier outcome of the story reflects not just the difference between Orwell's imagination and Huber's; it emerges from Huber's conviction that Orwell is flat-out wrong. And he believes that for two reasons: first, Orwell, an anti-technology socialist, was wrong about the benefits of technology and about the possibility of freedom under socialism; and second, he did not understand that the wide-ranging communications potential represented by the telescreen must of its nature make the telescreen an instrument for spreading freedom and choice rather than an instrument for suppressing them. It, or something like it, enhances the possibilities for memory the cornerstone of ownership; and for promise keeping the cornerstone of trade. Yet without the telescreen, the hegemony of Big Brother cannot hope to survive. In other words, Huber asserts that socialism is cybernetically unstable.
Huber has in fact restated F.A. Hayek's fundamental twofold challenge to socialists: (1) that socialism must be totalitarian, and (2) that socialism, lacking a mechanism for transmitting information throughout society and for gathering and sorting through it, must fail. What Hayek (and, of course, Mises before him) identified as the chief conveyor of information in a free market is the price system. 
Huber's thesis is not new to those of us who have been studying our enemy the state for decades. We remember Nathaniel Branden's remarks concerning Ayn Rand's Anthem:
It is illuminating to note, in passing, a crucial difference between Ayn Rand's projection of a totally collectivized society and the projection of such a society in Orwell's 1984, written some years later. In 1984, what is presented is a super-industrialized, super-scientific civilization. [Huber and I would dispute that description.] Orwell (and many authors who have since written similar books) may believe that totalitarianism is immoral, but they do consider it practical; they share the premises of those they denounce at least to this extent: they believe that it is possible to enslave man, to rule him by brute force, to forbid independent thought and yet, somehow, to keep and continue all that which is the achievement of a free mind. Ayn Rand knew better. And, years later, in Atlas Shrugged, she showed fully what industrial civilization depends on, and what happens when human intelligence ceases to function. 
Indeed she did. In Atlas Shrugged when the men of the mind go on strike, industry grinds to a halt, and the market disintegrates. The collapse is symbolized by the lights of New York City going out.
(Curiously, one might paraphrase Branden's criticism to note that while Rand understood that industrial civilization depends on free minds, she seems to have thought that a totalitarian society could nevertheless be a civil society. It has taken the Great Society and its successors to teach us what civil "civilization depends on, and what happens when human intelligence ceases to function.")
In 1970, Harry Browne's How You Can Profit from the Coming Devaluation painted a picture of runaway inflation and the concomitant collapse of government.  More, he explained what forces might bring that inflation about and what forces might intervene to head it off. While not predicting which of several outcomes might proceed from U.S. monetary policies, his explanations led many of us to expect virtual economic chaos and consequent social chaos in the early and mid 1970s. Subsequently, the questions for me have been: How has the state survived, and, How can we remedy that? "Polite totalitarianism" (TLD, Sept.-Dec. 1994) represents my efforts to understand the first and suggests to me that Rand notwithstanding there is no answer to the second.
Huber is not alone in insisting that telecommunications is a force for liberty against the state, but his presentation is perhaps the most engaging. It behooves us, then, to ask whether he is right, and if he is not, what are the implications for the Mises Insight? That is, given that the state has not collapsed, why hasn't it? And if it does not collapse in the near future, why doesn't it? How can the state resist the market and metaphysical forces identified by Mises, Hayek, Rand, and now Huber?
The thoughtful state
In its narrowest form, Mises's Insight is that in a socialized economy, by definition, there is no market for producers' goods. There is no bidding for scarce resources to build factories or develop new industries. Capital does not flow from inefficient uses to efficient ones, because there is no one bidding for it. There is only a Ministry of Plenty whose officials determine what is to be done where and in what quantities. Their decisions even if they are governed by the purest of intentions and the most informed of intellects must be fundamentally irrational. They have no standards to tell them how much of what is needed to obtain what goals.
It is not that they are unable to distribute consumer goods; rather, they have no way and in principle can have no way of knowing how to distribute the capital that is needed to produce the consumer goods. A socialist economy may experience a shortage in shoes, not because planners overlook the need for shoes, not because the raw materials are somehow not available, but because the factors of production were ordered without the benefit of a capital goods market.
The mistake that some libertarians make is to conclude that the Mises Insight somehow implies the collapse of the state. It may imply the ultimate collapse of a socialized economy, but that is not the same thing.
The Permanent Regime are not ignoramuses. They are as aware of the economic difficulties of running a centralized economy as any free-market critic perhaps more so. They, after all, are the ones out there trying to do it. They are the ones who keep tinkering here, adjusting this segment, fine-tuning that one. They learn from their mistakes, and, indeed, from the mistakes of their forerunners and colleagues in more heavily regulated economies. The nature of their task may be eventually self-defeating, but "eventually" can mean a long or a short time, depending on the skill of those engaged in the task.
While free-market economists are accustomed to saying that state regulation distorts the market, we should not be misled by that word "distorts." The free market is not just the choices made by the actors in it, but their subjective preferences. If a state can succeed in "distorting" a people's subjective preferences, if it can get them to do more or less freely for themselves what it wants them to do, then economically speaking, the choices those actors make form a network of free choices, i.e., a free market. The achievement of American totalitarianism is to pattern itself, when it can, according to the preferences of its subject people. There is a dynamic between ruler and ruled in the United States perhaps unique in history in which, in effect, the ruled tell the state just how far and in which directions it can push them around. From time to time, the pushing reaches unacceptable levels, and the state backs off and regroups, consolidating as much as can be consolidated, abandoning the offensive measures, perhaps putting them in storage for a more opportune time. 
Political opposition takes much the same form. A Rush Limbaugh gains acceptance in the market and in an old-fashioned totalitarianism might pose a threat to be crushed. In America, the Permanent Regime just shrugs, waits to see how successful polite efforts to silence him are (as, for example, by reviving the so-called Fairness Doctrine in broadcasting), and then accepts him more or less as a new definition of the opposition. He is a political safety valve.
Similarly, there are economic safety valves. Most regulations are either sought or accepted after the fact by American business and its customers, so that in a very real sense, there is no distortion of the marketplace. The distortion in thinking and in subjective preferences has supplanted it.
To be sure, there is the objective problem of capital. In today's economy, the average wage rate is $7.42 per hour; in 1973, it was $8.55, evidence that the American worker is becoming less productive.  Given that productivity is the gift of capital, the clear implication is that we are now devouring our capital. The Dark Suits' monetary policies cannot alter that outcome, and it is not dependent on our subjective preferences.
Not only is capital objectively consumed, but that "calling forth of inventiveness" discussed in last month's TLD  is turned away from enhancing the comforts and pleasures of customers in the voluntary sectors. Instead, it is turned to the requirements of state activities.
But while a major economic objective is to choose ends and to develop means to satisfy those ends, a ruling class has its ends ready-made: the subjection of the people under it. And while in an economy it is necessary that less efficient means be rejected in favor of more efficient ones, there is no such necessity in the political realm. The only necessity is that the means contribute to the end. Less efficient means can be tolerated so long as they do not give rise to revolution. Indeed, the dynamic between ruler and ruled may actually entail a more inefficient means as politically more feasible.  Economic realities, after all, are only one set of considerations that go into the mix of political decision-making.
Consolidation and centralization or decentralization and downsizing none of them is an end in itself. The Permanent Regime will use each of them as it is needed to strengthen or protect the regime's grip on the populace. It will even back off from some forms of intolerable oppression in order to preserve and maximize its rule over time. 
Only a tool
But if the inherent inefficiency of controlled markets does not imply the downfall of the state, what about Huber's enthusiasm for the possibilities of telecommunications?
Telecommunications is a tool. Like any other tool, it can be used for good or ill. I am reminded of a passage in Albert Jay Nock's Theory of Education in the United States:
I was lately shown a dormitory in an undergraduate college, and was told that people spoke only French in that house, no other language being permitted. This did not interest me. I asked what they said when they spoke French, this being the only thing that counts, for one may chatter nonsense and inanities in French as well as in any other language.... 
All one has to do to see that nonsense and inanities are as easily conveyed by telecommunication as by any other medium is to tune in to an Internet newsgroup or a CompuServe forum. Although one finds plenty of criticism of state activities in them, by no means are they a Mecca of free thinking. The fact that some anti-state sentiment enjoys a freewheeling forum is not inconsistent with regulation, any more than right-wing talk radio implies that liberals do not control the FCC.
Moreover, defenses of all sorts of state activity and compromise with leviathan are easily as abundant on line. All that telecommunications has achieved is that marginalized views can now be exchanged among the holders of other marginalized views, and that those views are easier to come by (both for sympathizers and opponents) than previously. It does not mean that they are more successful at penetrating or shaping the culture. And if a recent editorial in PC World is a measure, the PC world itself is considerably more "PC" than one might suspect: the piece calls for more regulation of the software industry to "preserve competition" and to break up Microsoft's "monopolistic hold" on that field. The author concedes that there are those who might object to his proposals, "especially in Bellevue." 
Of course, Huber's point is not merely that opponents of the state can get together and discuss their concerns more easily in cyberspace than they have ever been able to before. The same, of course, is true of proponents of state power. His focus is on the trade that telecommunications makes possible, the lightning speed with which decisions can be made and market information disseminated. He is absolutely right in thinking that increased communication facilitates trade and production: the so-called black market could surely find telecommunications a useful tool to conduct its business. The question for Huber's thesis is whether the black market can really bring down a totalitarian state, as he postulates in his retelling of Orwell's story.
We know from the Soviet experience that the black market is essential to the functioning of a controlled economy. A society in which bribery is just the way things work almost certainly experiences, on the one hand, less political pressure to thwart the black market and, on the other, a great deal of economic pressure to wink at it. However, in a society where citizens are more likely to look askance at bribery with a Puritanical self-righteousness, where a common boast of patriotism and civic-mindedness is "I pay my taxes," the black market may be less readily tolerated. (Even so, it is clear that the primary black market in the United States continues to function despite countless "wars" being declared against it.)
What Huber has missed is that logic and therefore all the science and commerce that depend on it is double-edged. Just as you must allow your opponent any argument form you employ, so any tool you can use against tyranny may be used by it against you.
There are no freedom-specific inventions.
Wired for statism
To be sure, the state has been slow at least in this country to get hold of the telecommunications potential, though perhaps not as slow as it sometimes appears.  While evidently there will be no law compelling the installation of Clipper Chips in every manufactured computer, the willingness of Americans to push their own mops in the state's cleaning-up operations may succeed where legislation has failed. One of the features of American society is the extent to which it imitates the state: the government's standards for its own offices and projects are often adapted by the voluntary sectors as their own even the editorial style manual of the Government Printing Office is often adopted by accounting firms or other businesses to prepare proposals. It is a neat parallel to the way that a telecommunicator chooses his modem settings to agree with the host modem when he logs on to CompuServe or America Online: if you are going to "interface" with the state, it is more convenient simply to adopt its conventions. To comply with the state's requirements, the simplest procedure is to pattern your compliance on the state's own practices. (Even businesses that do no business with the state sometimes find it easier to imitate the state's policies and practices than to design their own.)
In industry, that means that products intended for the voluntary sectors often meet the requirements of government-customers, even when there is, strictly, no law that the products be so constructed. After all, why manufacture according to two different sets of specifications? Manufacture all products according to government-customers' specifications, and you can sell them both to the state and to purchasers in the voluntary sectors. It is easy to see that such considerations become weightier as the state becomes more and more an economic force. 
Other possibilities for a state response to "undomesticated" telecomputing may be to require that every modem user have a license and every computer a registration. While I know of no proposals to this effect in any department of our leviathan, there is no reason to think they could not be enacted. We need only to wait for a suitable hacker-intrusion crisis or virus threat or the all-purpose demands of "national security" to provide the excuse for legislation to be proposed in an atmosphere of panic an atmosphere freshly familiar since April 19. Further, there is no reason to think there would be much opposition to such proposals if they ever were advanced. While users may be many, manufacturers and outlets are much fewer. We know that automobile dealers docilely comply with licensing and registration requirements. We know that auto manufacturers do not resist requirements to install "safety" accessories. On what basis should we expect manly resistance from computer Suits? 
The automobile analogy is useful, I think, to illustrate just how fragile the current liberty of computer use is. In some states with inspection laws, plenty of service stations are happy to participate, to serve as the agents of state inspection, even though there is no requirement that they do so. While ultimate enforcement may remain in the hands of state police, such programs would be virtually impossible to administer in geographically large states if businessmen simply refused to participate. But they do not refuse; they freely serve as hirelings of the state. In the face of such participatory compliance with regulations, what reason is there to expect anything different once telecommunications regulation is in place?
If computer users enjoy a latitude of freedom on the information superhighway, it is the latitude of a speeder on the Pennsylvania Turnpike. Most will never be stopped, but enough will be ticketed to keep some others in line. And everyone complies when there is the certainty of being monitored just as we all slow down when we see a trooper on the side of the road.
The real problem with the black market as an instrument of state opposition, however, is that, contrary to critics of advertising, the market does not create wants; it merely satisfies them. That is no small achievement, but its limitation highlights its inability to change the culture: if people want regulation and tyranny, the market is not going to give them something different.
The great challenge to the state, a challenge that we see being met in countless ways every day, is to get its subjects to want it and to participate in it. And if the state can corrupt them so that they help it supply regulation and tyranny, so much the better for the state.
Slavery out of freedom
One of Huber's most ambitious undertakings in his palimpsest arises from his observation that in Orwell's book Winston Smith never gets around to reading the chapter "Freedom Is Slavery" in The Theory and Practice of Oligarchical Collectivism. Huber calls it the "missing chapter" in 1984 and suggests that the reason Orwell did not write it is that he could not, that the telescreen does not mean that freedom is slavery, but that freedom is freedom. In Huber's fantasy, the samizdat book read by O'Brien is The Theory and Practice of Networked Individualism. The chapter "Freedom Is Slavery" in this book-within-a-book and O'Brien's interrogation of a phone phreak contain the core of Huber's argument.
In contrast, in observing the mopping-up operations of our implacable foe the state, I am struck by the ways in which our freedoms are turned against us, how they and we with them are corrupted into becoming the servants and even co-architects of our own slavery. In a sense, "Polite totalitarianism," indeed much of TLD, may be understood as our effort to write that missing chapter of Orwell's, to show how our slavery is carved out of our freedom. We understand the why, all right. We are trying to understand the how.
Posted September 27, 2002
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