The endless apocalyptic rhetoric surrounding Net Neutrality and many other tech policy debates proves there’s no downside to gloom-and-doomism as a rhetorical strategy. Being a techno-Jeremiah nets one enormous media exposure and even when such a person has been shown to be laughably wrong, the press comes back for more. Not only is there is no penalty for hyper-pessimistic punditry, but the press actually furthers the cause of such “fear entrepreneurs” by repeatedly showering them with attention and letting them double-down on their doomsday-ism. Bad news sells, for both the pundit and the press.

But what is most remarkable is that the press continues to label these preachers of the techno-apocalypse as “experts” despite a track record of failed predictions. I suppose it’s because, despite all the failed predictions, they are viewed as thoughtful & well-intentioned. It is another reminder that John Stuart Mill’s 1828 observation still holds true today: “I have observed that not the man who hopes when others despair, but the man who despairs when others hope, is admired by a large class of persons as a sage.”

Additional Reading:

• Regarding the Use of Apocalyptic Rhetoric in Policy Debates (10/29/14)
• The Problem with “Pessimism Porn” (5/23/14)
• Journalists, Technopanics & the Risk Response Continuum (7/15/12)
• How & Why the Press Sometimes “Sells Digital Fear” (4/8/12)
• law review article: “Technopanics, Threat Inflation, and the Danger of an Information Technology Precautionary Principle” (2013)

I wanted to draw your attention to yet another spectacular speech by Maureen K. Ohlhausen, a Commissioner with the Federal Trade Commission (FTC). I have written here before about Commissioner Ohlhausen’s outstanding speeches, but this latest one might be her best yet.

On Tuesday, Ohlhausen was speaking at U.S. Chamber of Commerce Foundation day-long event on “The Internet of Everything: Data, Networks and Opportunities.” The conference featured various keynote speakers and panels discussing, “the many ways that data and Internet connectiviting is changing the face of business and society.” (It was my honor to also be invited to deliver an address to the crowd that day.)

As with many of her other recent addresses, Commissioner Ohlhausen stressed why it is so important that policymakers “approach new technologies and new business models with regulatory humility.” Building on the work of the great Austrian economist F.A. Hayek, who won a Nobel prize in part for his work explaining the limits of our knowledge to plan societies and economies, Ohlhausen argues that:

regulators face a fundamental knowledge problem that limits the effective reach of regulation. A regulator must acquire knowledge about the present state and future trends of the industry being regulated. The more prescriptive the regulation, and the more complex the industry, the more detailed knowledge the regulator must collect. But, regulators simply cannot gather all the information relevant to every problem. Such information is widely distributed and therefore very expensive to collect. Even when a regulator manages to collect information, it quickly becomes out of date as a regulated industry continues to evolve. Obsolete data is a particular concern for regulators of fast-changing technological fields like the Internet of Things. This knowledge problem means that centralized problem solving cannot make full use of the available knowledge about a problem. Therefore, centralized regulation generally offers worse solutions when compared to distributed or emergent constraints such as social norms.

She continued on to explain the dangers of “precautionary principle” thinking as applied to new technologies, noting that, far too often, policymakers seek to impose preemptive, top-down controls on new sectors and technologies based on “concern over largely hypothetical future harms.” That’s a point I have stressed repeatedly in my own work on the importance of “permissionless innovation.” As I note in my book of the same title, living in constant fear of worst-case scenarios—and premising public policy upon them—means that best-case scenarios will never come about. When public policy is shaped by precautionary principle reasoning, it poses a serious threat to technological progress, economic entrepreneurialism, social adaptation, and long-run prosperity.

What’s the better alternative to precautionary controls to address potential risks? As Commissioner Ohlhausen noted in her speech to the Chamber of Commerce, regulators should “focus on identifying and addressing real, not speculative, consumer harm.” She explains how the FTC already has the tools to do so:

At the FTC, this focus is part of our statute. Congress charged us in Section 5 of the FTC Act with preventing deceptive or unfair acts and practices. Deceptive acts violate Section 5 only if they are material – that is, if they actually harm consumers. And practices are only unfair if there is a substantial harm that consumers cannot avoid and that outweighs any benefits to consumers or competition. In both cases, the law concerns itself with addressing actual consumer harms. Likewise the FTC carefully evaluates consumer welfare (or, its corollary, consumer harm) when it exercises its antitrust authority.

Importantly, she noted, the focus in this regard is on  ex post enforcement, not highly prescriptive ex ante regulation. “This incremental approach, which we have been using for nearly 100 years, has significant benefits,” Ohlhausen argued, and it is “consistent with Hayek’s thesis about the knowledge problem.” Namely, regulators should not be acting based on limited knowledge to address hypothetical future threats. Doing so derails opportunities for innovation and leads to myriad unintended consequences.

But the best part of Commissioner Ohlhausen’s speech was her embrace of what author Matt Ridley calls “rational optimism”:

Over the past two centuries, humankind has proven its ability to transform innovation into widespread prosperity. Fueled by supportive social attitudes and free market institutions, businesses have been the engines of this prosperity. Regulators who don’t want to stall these engines of innovation should remember the long history of beneficial innovation, remain humble about what they can know and accomplish, focus on addressing real consumer harm, and apply tools appropriate to the harms that do arise.

Critics will protest that innovation can just be too darn disruptive and that we have to preemptively legislate or regulate to counter those effects. But Ohlhausen has a powerful response to those critics:

innovation can, and will, be unnerving or unsettling. By its very nature, innovation changes things. Change is uncomfortable. That is why, as long as there has been innovation, there have been detractors and doomsayers. William Petty, the economist and doctor, said, “When a new invention is first propounded, in the beginning every man objects and the poor inventor runs the gauntloop of all petulant wits.” And he was talking in 1679! Pessimism about innovation sells newspapers and books. It also has a surprising intellectual caché. “The man who despairs when others hope is admired by a large class of persons as a sage,” said John Stuart Mill. But if the past 200 years of innovation have any lesson, it is this: society has repeatedly and quickly integrated and greatly benefited from innovation. The somber doomsday “sages” – from the Luddites in 19th century England to critics of credit card technology in the 1970s – have been wrong about the general effects of innovation. The many benefits have far outweighed the few costs. I am quite optimistic that the disruption of the Internet of Everything will continue the trend and greatly promote our prosperity.

Preach it, sister! That is exactly right.

Anyway, make sure to read Commissioner Ohlhausen’s entire speech. It is absolutely spectacular. I wish every regulatory approached their jobs with the same degree of humility, patience, and “rational optimism” that Commissioner Ohlhausen does.

John Stuart Mill’s On Liberty turns 150 this year. Published in 1859, this slender manifesto for human liberty went on to become a classic of modern philosophy and political science.  It remains a beautiful articulation of the core principles of human liberty and a just society.

Anyone familiar with the book recognizes the importance of the opening chapter and Mill’s “one very simple principle” for “the dealings of society with the individual in the way of compulsion and control, whether the means used be physical force in the form of legal penalties, or the moral coercion of public opinion”:

That principle is, that the sole end for which mankind are warranted, individually or collectively, in interfering with the liberty of action of any of their number, is self-protection. That the only purpose for which power can be rightfully exercised over any member of a civilized community, against his will, is to prevent harm to others. His own good, either physical or moral, is not a sufficient warrant. He cannot rightfully be compelled to do or forbear because it will be better for him to do so, because it will make him happier, because, in the opinions of others, to do so would be wise, or even right. These are good reasons for remonstrating with him, or reasoning with him, or persuading him, or entreating him, but not for compelling him, or visiting him with any evil in case he do otherwise. To justify that, the conduct from which it is desired to deter him, must be calculated to produce evil to some one else. The only part of the conduct of any one, for which he is amenable to society, is that which concerns others. In the part which merely concerns himself, his independence is, of right, absolute. Over himself, over his own body and mind, the individual is sovereign.

Mill went on to outline “the appropriate region of human liberty,” and divided it into:

1. “liberty of conscience, in the most comprehensive sense; liberty of thought and feeling; absolute freedom of opinion and sentiment on all subjects, practical or speculative, scientific, moral, or theological. The liberty of expressing and publishing opinions may seem to fall under a different principle, since it belongs to that part of the conduct of an individual which concerns other people; but, being almost of as much importance as the liberty of thought itself, and resting in great part on the same reasons, is practically inseparable from it.”
2. “liberty of tastes and pursuits; of framing the plan of our life to suit our own character; of doing as we like, subject to such consequences as may follow: without impediment from our fellow-creatures, so long as what we do does not harm them, even though they should think our conduct foolish, perverse, or wrong”
3. “freedom to unite, for any purpose not involving harm to others”

Bringing it altogether, he argued:

The only freedom which deserves the name, is that of pursuing our own good in our own way, so long as we do not attempt to deprive others of theirs, or impede their efforts to obtain it. Each is the proper guardian of his own health, whether bodily, or mental and spiritual. Mankind are greater gainers by suffering each other to live as seems good to themselves, than by compelling each to live as seems good to the rest.

To this day, I do not believe there has been a more eloquent or concise summation of the central principles of libertarianism than those passages from Chapter 1 of the book. But what many fail to remember or appreciate is the equally powerful second chapter of Mill’s treatise, “On the Liberty of Thought and Discussion.” It was a bold defense of freedom of speech and expression that was many decades ahead of its time. And it still has lessons and warnings worth heeding in our modern Information Age.

Mill opened that chapter by noting that:

The time, it is to be hoped, is gone by, when any defence would be necessary of the “liberty of the press” as one of the securities against corrupt or tyrannical government. No argument, we may suppose, can now be needed, against permitting a legislature or an executive, not identified in interest with the people, to prescribe opinions to them, and determine what doctrines or what arguments they shall be allowed to hear.

Alas, Mill knew that we weren’t quite there yet in 1859. Efforts to suppress speech and expression were alive and well. And so he marshaled all his intellectual forces to construct a powerful critique of censorship in all its forms:

The power itself is illegitimate. The best government has no more title to it than the worst. It is as noxious, or more noxious, when exerted in accordance with public opinion, than when in opposition to it. If all mankind minus one, were of one opinion, and only one person were of the contrary opinion, mankind would be no more justified in silencing that one person, than he, if he had the power, would be justified in silencing mankind. Were an opinion a personal possession of no value except to the owner; if to be obstructed in the enjoyment of it were simply a private injury, it would make some difference whether the injury was inflicted only on a few persons or on many. But the peculiar evil of silencing the expression of an opinion is, that it is robbing the human race; posterity as well as the existing generation; those who dissent from the opinion, still more than those who hold it. If the opinion is right, they are deprived of the opportunity of exchanging error for truth: if wrong, they lose, what is almost as great a benefit, the clearer perception and livelier impression of truth, produced by its collision with error. … We can never be sure that the opinion we are endeavouring to stifle is a false opinion; and if we were sure, stifling it would be an evil still.

Mill went on to show how, at root, censorship is based on arrogance and elitism:

Those who desire to suppress [an opinion], of course deny its truth; but they are not infallible. They have no authority to decide the question for all mankind, and exclude every other person from the means of judging. To refuse a hearing to an opinion, because they are sure that it is false, is to assume that their certainty is the same thing as absolute certainty. All silencing of discussion is an assumption of infallibility. Its condemnation may be allowed to rest on this common argument, not the worse for being common.

More profoundly, Mill taught us that the right to freedom of thought and expression was a core right upon which almost all our other rights depended:

Complete liberty of contradicting and disproving our opinion, is the very condition which justifies us in assuming its truth for purposes of action; and on no other terms can a being with human faculties have any rational assurance of being right.

In other words, if you care about any other rights and wish to exercise them to their fullest, you must first have the right to express opinions and, importantly, have them subjected to the opinions of others. This is how truth is discovered.

[Man] is capable of rectifying his mistakes by discussion and experience. Not by experience alone. There must be discussion, to show how experience is to be interpreted. Wrong opinions and practices gradually yield to fact and argument: but facts and arguments, to produce any effect on the mind, must be brought before it. Very few facts are able to tell their own story, without comments to bring out their meaning.

And Mill taught us that it is essential we be vigilant in defending our rights of speech and expression because, sadly, “the dictum that truth always triumphs over persecution, is one of those pleasant falsehoods which men repeat after one another till they pass into commonplaces, but which all experience refutes. History teems with instances of truth put down by persecution,” he correctly noted.

Mill’s words are every bit as relevant in 2009 as they were 1859. While we enjoy significant speech and press freedoms here in the United States today, censorial threats persist.  Just a few years ago, the House of Representatives passed the Deleting Online Predators Act (DOPA), which proposed a ban on all social networking sites in public schools and libraries.  DOPA passed the House of Representatives shortly thereafter by a remarkably lopsided 410-15 vote, but luckily failed to get through the Senate. However, Congress did pass several other online censorship measures in the 1990s, including the Communications Decency Act of 1996 and the Child Online Protection Act (COPA) of 1998, which luckily were both struck down by the courts.

Of course, we have it pretty good here in the States thanks the existence of the First Amendment to our Constitution. Most speech-restricting enactments get struck down today because they cannot withstand strict scrutiny under the First Amendment. But think about all those less fortunate in other countries who struggle on a regular basis to express themselves and learn the truth about the world and culture around them without interference from above.

Anyway, go give On Liberty another read if you haven’t done so in some time. It’s a timeless statement of the principles that should guide a just society. I’ll close with this apt warning from Mill about how history will remember those who fail to appreciate the importance of openness to new ideas:

And so far from the assumption being less objectionable or less dangerous because the opinion is called immoral or impious, this is the case of all others in which it is most fatal. These are exactly the occasions on which the men of one generation commit those dreadful mistakes, which excite the astonishment and horror of posterity.

Update: A colleague of mine just brought to my attention this essay of “150 Years of On Liberty” by Jonathan M. Riley that appeared in this month’s edition of TPM: The Philosopher’s Magazine.