- Shutting down only Visa and Mastercard would disable the vast majority of credit cards.
- Disabling debit cards or withdrawing funds from JP, BofA, Wells Fargo, and Citi would disable the majority of banking clients in the US.
- About 40% of US air travel could be stopped by hacking American and Southwest.
We've already seen similar large scale attacks on large companies:
- In the 90s and early 2000s, Microsoft's weak security allowed worms to cripple Microsoft Office and Windows.
- 100 million JP Morgan accounts were compromised by 3 people in 2015.
I was in Cusco, Peru a couple of months ago, and there are signs ALL OVER saying Visa accepted here, and also quite a few about Mastercard.
Imagine my surprise when we tried to make a purchase at a store (with Visa and Mastercard logos prominently displayed, no less!) where the merchant insisted on Mastercard. Not Visa.
I found my backup credit card. And another. And I went through my debit cards. As did my wife.
We had 9 cards between the two of us, and they were ALL Visas. Just not something you'd even think of in the US, frankly. And I've had plenty of Mastercards over the years, but the distinctions are rarely important to us.
And of course my wife has debit cards for her account and another card for our joint account. That's just off the top of my head. I guess that's 9-ish?
They're not all credit cards, but they all have logos.. and, as it turns out, all Visa, apparently. The obvious question is "why so many", and the answer would be "situations like this", except in this case, it didn't help.
I guess I could take them out of my wallet and just leave them at home, but... why? A year back I was going to Germany; my primary credit card was deactivated on my flight there due to fraudulent use at a Home Depot, while I was on the plane. A second card stopped working, so I was down to my last card, which I really needed to work for a many-thousand-dollar rental car hold.
Called all the banks; the first card was shipped to my house in the US to arrive within 10 days (thanks!), second card was NOT inactive, apparently the merchant terminal was just screwing something up. It worked just fine. But I was glad to have the third!
As a sidenote, it's cool to be on a call with a credit card company, and before you're even off the phone, Apple Wallet pings you with a notification that your new card is active. But not everyone takes NFC. And in general, Germany's weird about accepting foreign cards, so it's nice to have options.
> - Shutting down only Visa and Mastercard would disable the vast majority of credit cards.
Happened in the UK and Europe in June this year, where Visa's network crashed and took out credit card payment processing for millions of people for a good day or so:
As you can guess, that caused absolute chaos, with the crash becoming a major news event and many customers and businesses being unable to spend/receive money at all until it was fixed.
So yeah, forget a government. Even a large business like that crashing or experiencing major technical glitches for a few days or so would bring down a large portion of society.
I think a lot of government types would see many potential benefits in the way things are set up now. Even most regular people would have to, grudgingly, admit that, if it were necessary, this system could deliver the government unprecedented amounts of control. I mean, for good or for bad.
But yeah, there's likely a double edged sword there. No question.
So what you're talking about is neither a legal government power or something where people would trust the government and follow along. You're looking for a way for the people in power to seize further power illegally when they think it appropriate. There's no "for good" there; that's just authoritarians undermining the rule of law.
“Franklin Delano Roosevelt proclaimed a Bank Holiday...that shut down the banking system” in 1933 . This is an old power pre-dating our current hyper-centralised banking system.
That means causing some people to starve. Literally.
I can't imagine how it would improve some situation. At best, if transactions are stopped for a short enough time, you will not make it much worse.
This is true for geographic networks, economic and financial systems, software-as-a-service applications, and even potato variety in farming systems.[a]
If you take a broader view, you will note that the United States telling Visa and Mastercard to shut down all service in <country> will cripple that country's financial system.
The dangers of someone bringing your economy to a halt by 'hacking our systems' is overblown. These kinds of problems can be fixed, or routed around in a few days.
You don't have this option when the systems you rely on are completely controlled by another nation state.
Seems to me we're doing ourselves in. It just took a nudge to get that self-destruction rolling.
First, people with less cognitive capabilities seem to be inclined into conservatism and prejudice.
Now, how do you make people's cognitive capabilities less?
You make people poor.
Second, you can make people conservative by making them scared 
So you being a conservative politician and wanting to get more votes, you make people poor and scared and you get more votes. And the problem is, it is much easier to make people poor and scared than wealthy and feeling safe.
There are additional levers to be used, mass surveillance makes people not want to talk lest they reveal themselves to be not 100% aligned with the edicts of the regime. Plus if people aren't talking then they aren't discussing ideas, discussion is needed as without it people can end up believing very strange ideas told to them by the mass media or the conspiracy theorists, with both sets of those ideas being oppressive.
Fear is the big one though, even the smartest people succumb to it remarkably easily. It is quite funny to watch in a 'lemmings' type of way. But to watch it in a 'lemmings' type of way then you have to be in on it, a sick individual spreading the fear.
Per "Here Comes Everybody" (and similar books) the internet can allow the normally separated to organize and GTD. The __exact__ role the gov has played in the past. But people have to be willing to do that. Unfortunately, escalating fear and decisiveness maintain the power status quo.
Can you say "instant riot"
Think about it, how much did different cities cooperated when trying to get Amazon's HQ2?
That said, you could at least narrow the problem by getting just the US, the EU, and China to cooperate. (But even that strikes me as a Sisyphean task. But what do I know?)
Note: it is rational for them to simultaneously compete for corporate investment by offering individual tax breaks and lobby for such tax breaks to be made illegal at the federal level. This is rather hard to explain to many even otherwise intelligent people, but it's one of the most important lessons that game theory has to offer.
The EU was acting somewhat in this direction when it forced Ireland to collect taxes from corporations.
Why not? Because of the conflicting political ambitions involved on the part of key decision makers.
That's why my idea would be to create laws that make these deals null and void until they are put to a popular vote in the State or City or tax paying entity that will bear the burden of the costs.
A city or a state isn't a "firm." It's not seeking the private profit of its owners: it's seeking the welfare of its citizens, which is part of seeking the welfare of all the citizens of a nation. When it comes to government, "cartelization" isn't a bad thing, because it keeps private interests from exploiting public divisions to harm the common good for private gain.
Cartels prevent "races to the bottom," but some of those are actually good for society (e.g. the race to the lowest price per unit of product-value). Other races to the bottom are bad for society (e.g. lowest standard of living per worker), and government cohesion can help prevent them by resisting the private interests that benefit.
Unfortunately, the recent trend has been the opposite.
Now, somebody on the left who does this, but genuinely, like Bernie Sanders and Jeremy Corbyn is indeed rather popular, despite a severe disadvantage in media coverage, however neoliberals have unfortunately hijacked the show for the past several decades and are refusing to let go, hindering more Corbyns or Sanders that wish onto the scene.
If these were a nation-state they would rank in the Top 10, yes? Top 20 at the least?
With money comes power. With power the drive to maintain that power.
Where there is anti-West sentiment, these outfits should be very concerned. As should the rest of us, as it is the rest of who will fight their battles / wars, if history repeats itself.
Now as more and more "power" goes into the hands of corporations, less and less power is in the hands of the (supposedly "democratic") governments, which themselves are imperfect democracies. And make no mistake: corporations control, and have power over, vast and chunks of our lives. Crucially, that power is fundamentally held in a nondemocratic way: not subject to any scrutiny or control by the part of the people that it affects. For me, this is one of the most critical flaws of capitalism, the fact that privately held power and democracy are fundamentally incompatible, and that the more power corporations hold, the less democratic is our control over our lives: the less free we are.
The first issue is simple: fantastically enormous capital expenditures. The basic story here is simple and repeated, the early and medium stages of a new industry's development inevitably harvest all the low hanging fruit in terms of pure physics and math. There is no path dependency yet either. But as it matures the cost of incremental gains begins increasing non-linearly. In tech we see this most particularly in semiconductor fabrication, where the costs of the cutting edge processes that have powered everything we do have been on a J-curve for each new node. An article by by SemiEng "Big Trouble At 3nm"  earlier this year had a good graph from IBS show the trend in design costs alone. In terms of the fab themselves IBS estimated "3nm will cost $4 billion to $5 billion in process development, and the fab cost for 40,000 wafers per month will be $15 billion to $20 billion", and it wouldn't be surprising if that was optimistic. "7nm" (TSMC, ~Intel 10nm) has been hard and multi-billion expensive also.
Economically the only way to make this work is by trying to amortize towards the thankfully very low raw material cost through enormous volume, and players must be able to front fantastic sums with very long time horizons. How does this square with tons of tiny firms? Vertical integration could be gone after so it's a pure foundry model, but that still leaves just a couple of foundries in control there. That's chips alone though, lots of other areas of electronics have the property of low resource cost combined with utterly enormous capex requirements, such as state of the art displays. Improvements in energy storage also require plants like the Gigafactory. The results are super, super important in my opinion, it's absolutely in our overall interest to keep pushing forward computation (not just silicon but whatever else becomes possible like optical computing), to reduce the price and improve the performance of energy storage technology, better human/system interfaces (retinal scanning displays next perhaps?), more reliable better memory, and on and on. We're far from "done" here. Yet this naturally takes not just long time scale dirt moving but also R&D, inevitably including some blue-sky.
And blue-sky R&D in the context of tech brings us right back to government vs corps too. In principle one way to try to allow smaller firms again would be to offload a lot of this back onto government instead, which by definition has a long time horizon and shouldn't be as worried about individual short term ROI or any single area vs the long term health of the state as a whole. It can make the results of research available to all. But government R&D has not been keeping up there. Monopolies can act in effect as a pseudo-government in many ways financially, and in fact a lot of the scary parts of them can also potentially give them an escape from typical quarter-to-quarter thinking. Some of the key foundations of our current tech trace right back to places like Bell Labs and Xerox PARC, R&D outfits that performed long term research which their parents often didn't even profit from, but were themselves backed in part by the massive economic power of their parent corps.
And no discussion of this would be complete without getting back to one area the government directly plays in monopolies: intellectual property. Maximalism there long since got out of control. The Economist piece doesn't give this the right level of attention IMO, particular wrt tech where rather then merely having (overlong incorrectly implemented) copyright and trademark, there are "software patents" and "business method patents" that don't just cover an implementation but basic mathematics and fundamental ideas themselves. This is a big practical part of the "moats" they talk about in their conclusion, and the difficulty small firms have in competing because that would depend on interoperability.
The capex part is just really hard, and I didn't even touch on things like the space exploration SpaceX (and hopefully Blue Origin soon) has started to revolutionize after decades of doldrums. It's one thing to talk grandly about "splitting up the bad guys" and such, but asking the public to pony up tens of billions to take their place might be different (if it can't be disguised another way, like military spending maybe). And that's even assuming it'd work and government could do the job there, which it might not. R&D is more promising and the open research initiatives gaining steam now are an important part of that, but also unfortunately doesn't seem a slam dunk or very safe from politicians looking for easy things to cut and attack. "What is this even any good for anyway huh?" etc.
IP is promising if only because it's purely within the power of government itself in principle, it's a creation of government in the first place anyway. Making copyright function with software like it does all previous media (source escrow for non-open/available), reducing its term to levels that reflect how modern electronic distribution has reduced costs and increased audiences along with desired churn, eliminating software and business method patents entirely, carving out far more powerful interoperability exceptions, requirements that at the least technical protection measures cannot be stacked with legal protections (or must be very term limited), would all go a long way towards increasing dynamism there. So would legal changes to cut down the EULA tape, and not just for buyers either. Producers should also be fully protected from liability by default without any contract, and contracts reserved for sufficient sophisticated entities in bespoke arrangements that wish to affirmatively bargain standard rights.
It'd be good if popular anger here could be channeled towards some real positive changes, but I do fear that between lack of public or political understanding and powerful entrenched interests it will instead be channeled unproductively at best or into a real baby-and-bathwater situation at worst. To some extent big corps have even perversely taken a role defending some of our interests from governments in a way individuals cannot, would we be able to oppose intelligence agencies efforts to backdoor crypto as well as Apple for example? Of course conversely big companies have often been directly complicit and key to government authoritarian impulses and intel gathering too. It's really hard to figure out where to start, though I think IP at least is a relatively easy pickings place.
What's needed is actual decentralization, where consensus occurs without a trusted third party.
Please consider how systems like cryptocurrency, smart contracts, types of content-oriented networking, etc. may enable open platforms that can be an alternative to the monopoly companies'.
Unfortunately, the distinction between "brand" and "corporation" makes this point, while interesting, somewhat moot. Consider that the Koch brothers have been able to consolidate brands ranging from TIME to Sports Illustrated, from Brawny towels to Dixie cups. In a world where users desire a "long tail" of brands, corporations continue to consolidate but simply invest in a wider variety of brand names and marketing for them. There's still synergy to be gained from a consolidated entity operating all of those brands. And so we're right back where we started.
Exactly. An example: Whirlpool owns many major appliance brands (e.g. Maytag and Amana). They can afford to make ever crappier products, because they know when a customer is unsatisfied, they'll more than likely buy another Whirlpool under a different brand name.
Removing the consumer price standard for anti-trust enforcement would go a long way to preventing these huge oligopolies from forming
this would help prevent things being hidden or manipulated.
-- Hannah Arendt, "Eichmann in Jerusalem: A Report on the Banality of Evil"
> When daily life requires turning a blind eye to the falsity of countless things we’re told, it weakens the power of language to sort truth from fiction.
-- Oliver Burkeman
> The basic tool for the manipulation of reality is the manipulation of words. If you can control the meaning of words, you can control the people who must use the words.
-- Philip K. Dick
> The great enemy of clear language is insincerity. When there is a gap between one’s real and one’s declared aims, one turns as it were instinctively to long words and exhausted idioms, like a cuttlefish spurting out ink.
-- George Orwell
> All issues are political issues, and politics itself is a mass of lies, evasions, folly, hatred, and schizophrenia. When the general atmosphere is bad, language must suffer. [..] But if thought corrupts language, language can also corrupt thought.
Do you have evidence for any of this?
The statement is surprising on its face, but he plays a good devil's advocate. There are plenty of holes to poke in his arguments, so have at it.
1. You're not going to truly release the social value of a monopoly unless you socialize it, either through social control or regulation. Without that, the monopoly will mainly serve to benefit its owners.
2. Monopoly R&D expenditure will likely be less than the excess profit captured by the monopoly's owners, and mainly motivated by potential regulation. IIRC, the main raison d'être for Bell Labs to exist as it did was to convince regulators to not break up AT&T. Without that threat it would have likely been more focused on AT&T's profit motive and less on generalized scientific advancement.
3. Monopolies (socialized or otherwise) will more likely end in stagnation.
I somewhat disagree. There are some monopolies which become more valuable to society the larger they are due to network effects. One example is Google maps. I suspect the more people use maps, the more accurate their live traffic data will be, which gives every other user more accurate information. Marketplaces are another example of network effects benefitting users - the more buyers and sellers in one marketplace, the easier it becomes for them to find one another.
> 2. IIRC, the main raison d'être for Bell Labs to exist as it did was to convince regulators to not break up AT&T
Interesting, I was going to use Bell Labs as an argument in favor of monopolies producing r&d. It seems like they invented everything!
This makes no sense. Being extremely competitive and taking personal pride in being the best makes you a loser? By what logic?
If you want me to elaborate on something that you asked, and nothing something I made up, then ask me about something I said, not something you made up.
It's perfectly fine to be competitive, but this is in the context of someone who said they don't WANT competition, but a monopoly, and that this would somehow make them the "winner". Being just very competitive and taking personal pride in achievements is not what we're talking about.
If everybody played fair and the playing field was level, then winning would mean you're the best. But many people got confused, ignore the uneven playing field, cheat "because everybody does it", and then think winning says anything about them other than that they're needy. They can't "win" that way, and then brag about it, without being "losers" in another way.
When I said I wonder what their parents were like I wasn't being snarky, I meant whether their self-esteem is based on how others estimate their achievements. E.g. were they loved unconditionally, or were they blackmailed and rewarded with pseudo-love?
It seems obvious to me that many people were denied the means to build an inner foundation for themselves, and went from needing to be a certain way to be "loved" by their parents, to needing to be a certain way to be accepted by their peers, to do a certain thing to be considered successful, and so on. Yet a person could own the world without necessarily owning themselves, and not even owning the world can make up for not owning oneself. So many are floating over an abyss they have inside, and the moment they stop moving, consuming and/or subduing, they plummet.
More fortunate people simply have a bedrock of self-esteem, and then ambitions on top of that. They can compete without having to annihilate, they can give credit where it's due, and they build things because they can, not just because their mental floor is lava.