Ten years ago, the small publishing house that I had cofounded with one of my best friends in Greece collapsed. After laying off around a dozen employees, shutting down operations, and paying outstanding debts, I found myself jobless, heartbroken, and penniless. It was not our fault that our business had gone bust. The economy was crumbling all around us. The financial crisis that started in the United States had landed in Europe and was spreading across our continent, like a modern plague. Banks refused to lend, supply chains ran out of liquidity and trust, consumer spending evaporated, while public services were being drastically reduced or eliminated. Hospitals had no money to pay for drugs, and their doctors and nurses were working for months without pay. Unemployment shot through the roof, and the suicide rate exploded. Greece was being reduced to ruins. It felt like the end of the world.
Without much to do, I roamed the streets of Athens, like many thousands of my compatriots, taking part in demonstrations, raising our fists against the “troika”1 that had imposed such terrifying and unfair austerity upon us. Memories from the brutal occupation of Greece by the German army during World War II fueled powerful anti-European sentiment. Many saw foreign-imposed austerity as occupation by other means. Conspiracy theories abounded that the country’s assets were being sold off for pitons. Brazen headlines in the German press such as “Sell your islands, you bankrupt Greeks— and Acropolis too!” did not help.2 But demonstrators quickly turned against the local political class too. Members of Parliament and ministers, afraid of the citizens that they were supposed to serve and represent, would not dare walk the streets alone and without police protection. The people blamed them as complicit in their suffering. After all, it was the politicians who had agreed to the onerous terms of the country’s bailout. Almost daily, protestors would try to storm the Parliament while it was in session, only to be pushed back by the police. The acrid stench of tear gas mixed with that of burned tires hovered around the city for months. These were strange and bewildering times for a country that had suffered under a military junta as recently as the early 1970s, and for a people who had fought for the right to vote for a democratic Parliament.
And while representative democracy was hitting the lowest levels of popular trust, a different kind of democracy emerged in the city’s streets and squares, one that ancient Athenians would easily recognize. Citizens formed ad hoc assemblies to discuss, deliberate, and vote on a wide range of issues. Bypassing the cash-strapped government—which was unable to help anyone anyway—citizen groups set up marketplaces where agricultural produce could be sold directly from producers to consumers to keep prices low. With the national health system in tatters, volunteers organized street clinics for those who could not afford private health care. Others would establish soup kitchens and food banks for the needy, whose numbers swelled by the day. Out of the rubble that Greece had become, people self-organized and took whatever control they could of their destiny. Similar grassroots movements of mutual support and direct democracy emerged in other countries that were also hit hard by the economic downturn, like Spain. In Barcelona, neighborhoods ran their own citizen assemblies. The anti-austerity movement Podemos, inspired by the traditions of the Spanish Second Republic, saw the crisis as an opportunity to reinvent city government from the ground up.3 A few years earlier the banking crisis in Iceland had also resulted in citizens taking charge from politicians, forming a popular assembly and voting for a new constitution.4 For me, it was particularly fascinating to witness how citizens mobilized and self-organized in times of crisis, and how they reinvented democracy in its rawest, most direct form; for I too had participated in a pan-European citizen assembly several years earlier and had known firsthand the power and social dynamics of direct citizen deliberation and action. Maybe there was hope, I thought.
And indeed, something seemed to change. The direct democracy of the streets was finally making an impact on the representative democracy inside Parliament. The conservative government fell, and fresh elections brought to power Syriza, a far-left party that promised to stand up to the country’s creditors and renegotiate a less onerous deal. A referendum followed wherein more than 60% of voters backed the government and rejected the terms of the bailout.5 There was jubilation in the streets. Five years of demonstrations seemed to be paying off. Unfortunately, those aspirations and dreams were quickly quashed under the brutal realism of international politics: it did not matter how people felt or what they wished or voted for. Others determined our fates; decisions were taken in faraway places, behind closed doors, where money mattered more than dreams and no one cared to ask citizens if they agreed. The new, leftist government was forced into a dramatic turnaround by the hated troika, agreeing to even harsher terms that piled more debt on the country for many generations to come. We, the people, were shown to be powerless. And as the crisis deepened, we only got poorer and more desperate.
Disillusioned and without hope, my wife and I decided to throw in the towel, leave Greece, and begin a new life in England. Little did we know that we were leaving one crisis to be met by another. As we were packing suitcases into our car to drive away, hundreds of thousands of refugees from the senseless and bloody wars in Syria, Iraq, and Afghanistan amassed along the Turkish coast, risking—and often losing—their lives in order to cross the Aegean Sea over to Greece for a better life. It was an irony that defied all ironies. It was also the beginning of the metastasizing of the financial crisis into an existential crisis for European democracy. In the years to follow, the issue of immigration would toxify every political debate and give rise to a virulent brand of populism unseen in Europe since the 1930s. The ghosts of the past had risen from their graves to haunt us. Democracy was under attack by a new cadre of politicians who challenged every principle of “liberalism,” the core ideology of Western democracy. What was even more puzzling and disturbing to me was that their attack on liberal democracy was made in the name of democracy! Something was wrong. Nothing made sense anymore. The world had gone mad.
The seeds for this book were planted in my mind as I was crossing a turbulent Europe in my car, all the while thinking about how our lives had changed dramatically because of bad political decisions in which we had neither influence nor say, let alone control. Till then, as a citizen and an entrepreneur, I considered democracy as the indifferent backdrop to my personal, social, and economic life. I was content to leave politics and the running of government to politicians and focus on my family, friends, work, business, and hobbies. I did not really trust politicians, the system was obviously far from perfect, and there were injustices that would often make me angry, but democracy, despite its many imperfections, had the advantage of learning from its mistakes, improving, and evolving—it was, as Winston Churchill famously quipped, “the worst form of government except all those other forms that have been tried from time to time.”6 Furthermore, my generation had come of age at a time when liberalism appeared unchallenged, with all other competing ideologies and systems of government confined to the dustbin of history. Liberalism’s successes were many and profound. Global markets were made open and free, as were borders. Hundreds of millions of people around the world saw their income rising and their families coming out of poverty. Infant mortality had seen a dramatic fall, and global illiteracy numbers dwindled. In the West, men and women were free to choose whom they loved without the fear of being persecuted for their sexual preferences. Scientific discoveries, new knowledge, and technological innovation created new opportunities for the future and innovative ways to solve big global challenges such as climate change, environmental degradation, food insecurity, and poverty. Until the crisis came and annihilated our livelihoods, many, including me, felt lucky to be living in free and prosperous times, moving onward to an even better tomorrow.
All those dreams, aspirations, and expectations were shuttered during the “lost decade” that followed the global financial crisis of 2007 to 2009 and the Great Recession. Our politics became polarized, voters moved toward the extremes, and the center collapsed. UK citizens voted to extract their country from the European Union in the 2016 referendum. Far-right, nationalist governments rose to power in Italy, Poland, and Hungary, while nationalist populists effectively framed the political debate in France, Holland, Denmark, Austria, and Germany. The European Union, the most ambitious peace project of the liberal order of the twentieth century, was accused of being the work of self-serving elites.7 Donald Trump won the 2016 US presidential election against all odds and despite desperate attempts by mainstream media to prevent him from doing so. Trump understood that in our digital age politics has been colonized by show business and voters behave like an audience consuming entertainment. By using the power of social media, he bypassed the authority and critique of the fourth estate and demonstrated how the political campaigns of the future will be fought and won—for better or worse.
And then, like tragic irony, the COVID-19 pandemic arrived in the midst of a new US presidential election year, and shortly after the UK had exited the European Union. Despite the lack of adequate data on the prevalence of infections, most governments decided to hedge against a possibly catastrophic impact on their healthcare systems and put their countries on lockdown. In the spring of 2020 nearly half of the world’s population were confined to their homes. The global economy ground to a halt. Authoritarians saw in the pandemic an opportunity to extend oppression and surveillance in the name of public health. But for democracies the pandemic posed a terrible trilemma between curtailing deaths, lifting lockdowns to save the economy, and upholding civil liberties. This trilemma would test citizen trust in politicians and experts even further. How democracies resolve this trilemma may indeed determine their future in the post-pandemic world.
While the forces of authoritarianism, nationalism, and antiglobalization find a new ally in the COVID-19 pandemic, a tsunami of technological disruption is compounding the historical, and unprecedented, challenges to democracy, liberalism, and free markets. Artificial intelligence (AI), together with intelligent robotics, sophisticated sensors, communication networks, and big data, is reshaping the global economy and ushering in a new industrial revolution—the Fourth Industrial Revolution.8 Just as in the First Industrial Revolution in the eighteenth century when machines automated manual work, this new “intelligent machine age” in which machines are automating intellectual work is forcing us to adopt new forms of economic and political organization.9
Just imagine a factory where production is fully automated. Robots do the mechanical work, the casting, the molding, the welding, the joining, the logistics; AI systems perform the design, the planning, the strategy, the pricing, the financial management, the marketing, and the sales. Humans are virtually absent, for they are not really needed. A new class of supersmart robots and several million lines of software code have replaced human dexterity and creativity. Labor and knowledge have thus become tradable assets that can be bought, sold, or rented, instantaneously and at scale. In such a scenario the efficiency of capital is maximized, and capitalism is reaching its apogee by producing goods and services of unparalleled quality at the lowest possible price. But here’s the rub: as AI-powered automation makes companies more efficient and productive by eliminating the need for human labor,10 consumers—the ex-workers in those companies who are now unemployed—no longer have the means to purchase those fantastic new goods and services. Automation kills not only the worker but the consumer too. Capitalism’s great success thus becomes its ultimate downfall. To demonstrate the point—often referred to as the “automation paradox”—The Economist published an apocryphal story, supposedly taking place in the 1960s, in which two titans of the automotive industry, the industrialist Henry Ford II and the leader of the United Automobile Workers Walter Reuther, were touring a new, fully automated manufacturing plant. “Walter, how are you going to get those robots to pay your union dues?,” teased the boss of Ford Motor Company. Without skipping a beat, Reuther replied, “Henry, how are you going to get them to buy your cars?”11
Nevertheless, the most politically explosive outcome of full automation is not ending up without consumers but the transformation of a free economy into a zero-sum game wherein capital wins and labor loses. Left unchecked, those who own the robots and the AI systems would enjoy a disproportionate share of the wealth generated by the intelligent machines,12 while the rest of humanity is relegated to a subsistence level of existence. In a “business as usual” scenario the Fourth Industrial Revolution could make today’s inequalities seem petty and insignificant and confirm the most dystopian prophecies for the future. Surely, such a future is morally and socially intolerable.
And while automation looks like a threat to free market economies, a different story unfolds in communist China. There, Marx appears strangely vindicated. For Chinese central planners, AI and robots are what true communism needed in order to, finally, occur. As the state has ultimate power over every business in China,13 and as Chinese citizens are nudged into sharing their personal data through the “social credit system,” the most important economic and geopolitical competitor of the West is moving toward digital authoritarianism inspired by Confucian ideas of social order and harmony. China’s spectacular rise over the past twenty years has debunked the myth that capitalism and liberal democracy are the two sides of the same coin. Clearly, they are not. It now appears that communism may be a system better suited for managing the socially devastating externalities of a fully automated economy. That’s because Chinese citizens, although they may not have a say on who governs them, will, at the very least, be protected by their presumably benevolent, AI-powered, centralized state if and when full automation hits—more so than their counterparts in the West who, unless something changes, will be facing poverty and destitution. Given how the Fourth Industrial Revolution could drive different outcomes for different political systems, is there a future for liberal democracy in the age of intelligent machines? And, if yes, what should that future look like?
These are the questions that this book will aim to answer. For there is also a very optimistic side to this new wave of cognitive automation technologies, one that can be exploited to advance, not reduce, democracy and the welfare of citizens in a free society. Intelligent machines are cognitive multipliers that can massively augment human productivity and creativity. By freeing us from mundane and repetitive tasks, intelligent machines can allow us more time to spend on things we love, and with those whom we love. Algorithms that make sense of big data can catalyze new scientific discoveries in medicine, physics, biology, materials science, and space travel, to name but a few, and can help provide solutions for global challenges. In order to avert the Fourth Industrial Revolution becoming a winner takes all, we must reimagine cognitive automation so that the wealth it generates can be shared more widely and fairly. In effect, we must find ways to democratize the digital economy. We are already seeing how such democratization could take place at the level of the enterprise. Artificial intelligence in combination with cloud computing, data, and emergent distributed ledger technologies—that are increasingly referred to as “web 3.0” technologies—could transform how businesses are organized, how work is done, and how the fruits of business success are shared and distributed. Such profound transformation in business already erodes the traditional, hierarchical structures and governance of industrial-era corporations and creates new organizational paradigms wherein collaboration is virtually leaderless, peer-to-peer and interconnected, and wherein governance is more participatory and democratic. Capitalism need not become a zero-sum game because of automation. We can use automation technology in a different way and harness free markets, as well as empower human ingenuity, so that every citizen has a meaningful stake in the future.
In the years following the collapse of my small business in Greece, I had the opportunity to join, as an AI engineer and management consultant, the hundreds of thousands of entrepreneurs, businesspeople, and technologists who are currently shaping the Fourth Industrial Revolution. My job has taken me around the world, from participating in casual meetups of breakthrough innovators, to running workshops on future organizations and discussing the future of AI with executive leaders from some of biggest multinationals, to having conversations with politicians, activists, artists, and lay citizens at public events. My conclusion has been that we in the West are moving toward the future at three different speeds. The avant-garde are the technology innovators; they are the geniuses that are achieving the impossible through hard work, passion, and the shear strength of their imagination. They are moving extremely fast, breaking new barriers on a daily basis, creating with the help of capital the valuable companies of tomorrow. At some distance behind them, and at much slower pace, follow the big corporations. Owing to legacy systems and processes, anachronistic cultures and organizational structures, and industrial-era methods of governance, global players across every industry struggle to catch up with so many waves of disruption coming at them at quick succession.14 Finally, at the slowest possible speed, is everyone else, including small business, lay citizens, politicians, and regulators. Depending on the speed you travel, you have a different perspective and understanding of the AI revolution.
The biggest risk of this three-speed and fragmented approach is that we will fail to reach consensus on the magnitude and the nature of the task and will end up applying old solutions to solve new problems. If we do so, we will fail to exploit the enormous opportunity of the AI economy to completely transform our lives for the better. How we rethink the AI economy in order to enhance democracy, deal with wealth and income inequality, and empower citizens has become even more of a pressing issue given the devastating economic and social impact of the COVID-19 pandemic. In effect, the pandemic has massively accelerated some of the most adverse ramifications of the Fourth Industrial Revolution—specifically, digital transformation of work, massive unemployment, an increased role for the state, and unhindered surveillance of citizen data. Thankfully, the potential of technology to provide much-needed solutions to get us out of this new crisis is enormous. Artificial intelligence is not just another add-on technology to be subsumed into our traditional systems of government and business. Machines that automate the human intellect can change everything. We are at a tipping point in history, and we therefore need a new playbook on how to deal with that change. This new playbook must connect the dots of technology, ethics, political philosophy, exponential innovation, economic fairness, environmental sustainability, and inclusivity and deliver a new synthesis of ideas.
Cyber Republic was born out of my humble ambition to provide a nudge toward a more concerted, cross-disciplinary, and collective effort in putting together this new, and much-needed, playbook for the Fourth Industrial Revolution. I therefore hope that, by sharing my personal experiences and expertise as a technologist, as a management consultant working with companies that are adopting AI, and as someone who has organized and facilitated a citizen assembly at the European level, I will be adding a useful lens to complement the tremendous work already undertaken across academia, and notably among political scientists, on the intersection of politics and technology. Given the herculean size of the collective task, I will focus, more narrowly, in two main areas of inquiry and exploration where I can bring my experiences and expertise to bear the most.
The first area is why we should make—and how to make—our liberal democracies more inclusive. Given my personal experiences in Greece and elsewhere, I will argue that we must adopt mixed models of direct and representative democracy in order for citizens to regain their trust in democratic institutions as well as reengage with politics in a responsible way. My proposals will examine the use of deliberative models of self-governance, such as the spontaneous citizen assemblies in the streets of Athens and Barcelona, and I will discuss how we can scale such an approach and embed it in the liberal system of government. I will argue that one of the two key problems we need to solve, in order for this mixed model to work, is the way in which direct citizen participation is limited by knowledge asymmetries and time constraints. By “knowledge asymmetries” I mean the knowledge gap that always exists between experts and nonexperts. Complex problems require expert knowledge in order to be solved, but in a democracy they also need the approval and consent of the electorate. One of populists’ most favorite all-time shooting targets has been the expert. In a recent example, Michael Gove, a British politician who was one of the leaders of the Leave campaign during the Brexit referendum, when asked to name the economists who backed Britain’s exit from the European Union, said that “people in this country have had enough of experts.”15 I will argue that the tension between experts and nonexperts can be solved to a great extent by leveraging a combination of machine intelligence and citizen assemblies. Given that taking part in politics takes time, and time needs to be compensated when it is scarce, I will also argue that we need to think of the future as a place where everyone has enough time and wealth to participate in politics, and then use the appropriate sets of technology to get us there quickly.
My second area of inquiry is how to transform the digital economy so that wealth is shared more equitably between innovators, investors, and workers. I will argue that, if we want to preserve our democratic liberties and freedoms, we must democratize the AI economy—the successor to the present-day digital economy. For this to happen, we need to solve the wealth asymmetry in a noncoercive way. We must do so not only for ideological reasons but also because, in a globalized economy, national governments already find it difficult to tax the profits of big, global corporations. This problem will become more acute when these national governments find themselves trying to fund national budgets while their tax base at home is dwindling as a result of automation. We therefore need a bottom-up approach to the problem of wealth asymmetry, one that changes the game of wealth creation at the source and does not require a government to act as the wealth and income redistributor. As I will show, automation may not completely eradicate work, but it will probably destroy most jobs and render most of us, as well as the next generations, part-time workers. This transformation in how we work, earn a living, and pay taxes requires a radically new thinking. I will argue that universal basic income—as most people are thinking about it today—is fiscally problematic and practically insufficient to preserve and improve standards of living for citizens when incomes become uncertain and intermittent. And I will propose alternative ways, whereby citizens do not simply survive at near sustenance levels by becoming dependent on an increasingly intrusive state but are given the opportunity to participate actively in the creation of new wealth and be able to have savings. My proposal will look into leveraging distributed ledger technologies in order to create a new generation of digital platforms and markets where participants share ownership in the value they create though their participation, or simply by provisioning use of their data. I will also argue that for this bottom-up approach to reforming capitalism to work we must also rethink and reengineer how private businesses are governed. Future, postindustrial organizations will look very different from the industrial-era companies we are used to today; they will probably be leaderless and owned, as well as governed, by millions.
The nature of politics is such that not everyone will agree with my suggestions or analysis. Whether you are a progressive or a conservative will very much color your judgment of this book. I therefore think it is important to state right from the start where I stand politically and to identify the values that I will defend. I believe that liberty and individual responsibility are the foundations of civilized society; that the state is only the instrument of the citizens it serves; that any action of the state must respect the principles of democratic accountability; that constitutional liberty is based on the principles of separation of powers; that justice requires that in all criminal prosecution the accused shall enjoy the right to a speedy and public trial, and to a fair verdict free from any political influence; that state control of the economy and private monopolies both threaten political liberty; that rights and duties go together and that every citizen has a moral responsibility to others in society; and that a peaceful world can only be built on respect for these principles and on cooperation among democratic societies.16
On the basis of this political position, I will bring my proposals together in imagining a future democratic polity that I will call “Cyber Republic.” Think of it as an imperfect yet adequate “paper prototype” for a democratic polity in the spirit of design thinking, whose purpose is to aid discussion, debate, and continuous redesign and improvement. The prototype’s aim will be to suggest solutions to three existential challenges for liberal democracy: how we repurpose AI as a human-centric technology that works for all, and how we use this technology—in combination with ideas from deliberative democracy and other technologies—to solve the knowledge and wealth asymmetries. I regard those challenges as existential because I believe that, unless we solve them, citizens will abandon the liberal system of government and the core liberal values that inspire it. I will be discussing aspects of a Cyber Republic throughout the book, but here’s the general outline: it is an evolved system of liberal government that incorporates direct citizen participation in policy decision-making, while adopting and using human-centric automation technologies to provide equal opportunities for personal and collective growth and economic development. As nations recover from lockdowns and the global economy reboots, it is my hope that Cyber Republic will offer a set of useful tools, ideas, approaches, and suggestions for policy makers, researchers, technologists, civil society groups, workers’ unions, and governments, as they formulate the new playbook for liberal democracy and free markets in the Fourth Industrial Revolution and the post-pandemic world.