Speculative direct democracy: the cybernetic tax-allocation feedback loop

Paul Raven @ 07-10-2010

Here’s a really interesting thought-experiment from Adam Rothstein, riffing off the no-fee-no-fire-brigade story and the receipt-for-your-taxes idea. I’ll let him explain rather than attempt to paraphrase:

What if after seeing this receipt, taxpayers were allowed to shift where their taxes went? Say, less Pell grants, and more to the war in Afghanistan, if that was their priority. Or less war, and more highways. Of course this would affect their service. The service only gets what the individual public thinks it deserves from their contribution to the tax coffers. It would be easier to go all Henry Thoreau on a war a hemisphere away then it would on, say, your local fire service, because there are fewer people contributing to your local fire bureau than paying national taxes, and you’d see the effect of the latter right away, the former only later. But hey, open it up. Let people pay their share of what they think it important. Let’s think about what would happen, if people could actually control where the money was going.

Other than finally letting individuals control their tax dollars, what this would eventually create is a massive, cybernetic feedback loop. Let’s say you opened up a website with UI controls, so you could adjust your proportional tax payment anytime you wanted, adjustable down to hourly segments of your fiscal year total. (I am assuming you must still pay your full total, you can just allocate the percentages. Otherwise, everyone would obviously opt to pay nothing at all.) And this site updates. So after it first launches, we see (and I am just guessing here) payment for education and arts decrease, and military spending increases. After a few hours of people allocating their own taxes, education and arts are almost at zero. But then what happens as people see these changes? Maybe someone who originally allocated 75% military/25% education, on seeing education spending slide nationally to nothing, decides to allocate 100% education to make up for the difference. How many people do this? Enough to counter the childless militants? What sort of equilibrium is reached? Is an equilibrium reached?

Now imagine, after they open up the API of this system (naturally), third-party algorithms are introduced. Want to help the budget reach 25% for education nationally? Install this add-on, and it will auto-adjust you and everyone else using the add-on in a unified front to make this goal a reality (while protecting your personal data, of course). Or maybe you set it to automatically devote up to 100% of your individual taxes to education, unless highways dip below 5%, and then it re-figures your totals according to your preference. Or, download the Democratic Party algorithm, which will automatically adjust your percentages to match the national tax distribution platform of the party. Download the Support our Troops algorithm, which helps the Veterans and Military budgets maintain a certain consistent ratio to the overall budget depending on how many troops are currently on active duty. Pledge to Support the Dollar, by downloading the FOMC algorithm that will adjust internal infrastructure spending and national debt spending in such a way as to drive the strength of the dollar world-wide. How about an algorithm that scans the news for stories of political scandal, reducing the money allocated to congressional salaries every time there is another ethics violation? Too many fires in your district last month? The Google Map Fire Layer-aware algorithm will automatically up your fire services percentage by an appropriate amount.

Now what would be REALLY REALLY interesting: what sort of equilibrium is achieved, and how far off is it the current balance as it now, without this sci-fi direct democracy scheme? After all the algorithms are factored in, and all the feedback to the results of the algorithms are calculated and re-factored… are we actually any different than where we are now? Is our national desired budget, summed from all the diverse opinion about where we ought to be spending money, really any different from reality? If we let one person tweak the budget, they’d do all sorts of different things. But if everyone’s opinion and rate of pay were weighted together, I’d say it’s a fair bet that we’d end up exactly where we are.

[…]

Is it possible that as bankrupt and backwards as our democracy is, that it actually functions perfectly at doing what it is supposed to do? This function: to obfuscate and abstract our own lack of knowledge and ability, to direct our attention away from our responsibility for our own egos. And is it possible that the government, by echoing the non-sensical desires and demands of a populace that is as fickle as a television programming schedule, is already the representative compass of a society that is ready and willing to sprint directly towards oblivion? This society that would rather wage war across the globe than put out the fires in our neighbors homes, and fix the gas lines underneath our own feet.

Provocative stuff, and no mistake; much like Rothstein, I’d love to see the results of an experimental run of a system like this, though I’m perhaps a trifle more optimistic about the results we might see, especially if there were a good degree of local granularity involved.