The Internet causes connections to multiply and strengthen, creating a frenzy of positive feedback, which can drive people apart--not together
Optimists have long dominated the cyber-landscape, firm and vocal in their belief that the Internet creates a more transparent world, and that the quick and easy access to information it provides is bringing the global population together into one enlightened chorus of harmony.
My perspective is different, and my goal in this, the first in a series of posts for The Atlantic, is to lay out the implications of an Internet-driven world.
I have been deeply concerned that the Internet has created a centrifugal force that has the potential to tear us apart. The Internet's reinforcement of uncompromising positions during acrimonious budget debate in Washington, the Internet-facilitated, high-frequency trading driving volatility in financial markets, and the use of Twitter to organize the recent street riots in the UK brought to mind Eric Hobsbawm's 1994 book, The Age of Extremes. The book is about the extreme historical events of what Hobsbawm called "the short 20th century." But he could just as easily have been writing about the 21st century, the Internet age.
Hobsbawm wrote: "The world of the third millennium will therefore almost certainly continue to be one of violent politics and violent political changes." What he left out were all the extremes that result from living in an Internet-driven, overconnected world. Of course, 1994 was a bit early to reach such a conclusion.
Central to my own viewpoint is the concept of positive feedback. I use the phrase as engineers use it (I confess to being an engineer). The term "positive" refers to the fact that change reinforces or adds to change, rather than the desirability of the outcome. For example, if you had a savings account as a child and it paid two percent interest, that interest got deposited back into your account, fed back, and drove the exponential growth of your savings. In 36 years, your account would double in value. But if you could find a bank that paid you five percent instead, the increased level of positive feedback would double your account balance in just 14 years.
As the Internet causes connections to multiply and strengthen, positive feedback driving our economic, financial, political, business, and social processes increases. And too much positive feedback drives situations to extremes.
The Internet is positive feedback's best friend. By strengthening interconnections, it compounds the amount of feedback in systems and drives them to extreme states. In Egypt and Tunisia, the Internet carried messages on Facebook and Twitter that helped to magnify the social unrest -- a desirable effect of positive feedback. The Internet played an important role in powering the explosive growth in over-the-counter derivatives, from $60 trillion in 2000, to over $600 trillion in 2007 -- an undesirable effect of positive feedback. This growth could never have taken place without the information backbone provided by the Internet. Without the Internet, how could Lehman Brothers have dealt with the 980,000 derivatives it had on its books at the time of its bankruptcy?
Everywhere you look, positive feedback abounds. Consider what I call thought contagions, which I will discuss at length in a later post. Others give different names to essentially the same phenomenon. Malcolm Gladwell used the label "tipping point." And the great 20th-century sociologist Robert Merton coined the term "self-fulfilling prophesies," which came true because people believed they were true. For example, when people believed a bank was going to fail, they mobbed the bank and withdrew so much money, otherwise sound financial institutions collapsed. Positive feedback, which is always a factor when it comes to thought contagions, lay at the core of such events.