Abstract

Regulatory capture involves a two way street. Just as corporations can capture the government regulation agencies it is also possible for governments to capture corporations. As a result government regulation agencies can fail if they are captured and corporations can also fail if they are captured. It may be time to think outside the box about how we can form organizations which resist regulatory capture so that if government/corporation fails the services can remain available.

There are no perfect markets

In addition to the problem of "regulatory capture" we also have the problem of "attention scarcity", "information asymmetry", and "accelerating societal complexity".

All of these problems influence decision making. Free markets only work in the ideal of perfect information between all participants. Since we don't have perfect information between all participants we do not have free markets and we probably never will.

Regulation of the markets are usually by government agencies which are centralized, and usually easily captured because the key players are known entities with known vulnerabilities.

Attention scarcity is a problem which can be exploited by social engineers. So for example a bill can pass with 50,000 pages so that constituents don't have enough attention to read each page. Complexity for instance in the law can mean even if a team of constituents crowd source the act of reading the new law it is unlikely they'll be able to interpret it because it's encoded in legalese.

How are we all affected by the attention scarcity problem? The terms of service agreements. Can anyone say they have read and understood every single terms of service agreement they have ever read? Okay now what about the laws? Can anyone say they have a complete and accurate understanding or even knowledge of every law on the books? What about products in a supermarket? Do people read every ingredient and understand the chemistry of their food?

These outstanding problems exacerbate other problems which lead to many loopholes in society. Advertisers exploit these loopholes, lawmakers exploit these loopholes, lawyers exploit these loopholes, police exploit these loopholes, computer programmers and hackers exploit these loopholes, and as society gets more complex these problems get worse.

These problems are interconnected and are caused by human cognitive limitations

Of course all of these problems are connected. Information asymmetry in markets allow for moral hazard. Attention scarcity is linked to information asymmetry and the slow rate of innovation/knowledge diffusion.

For example a person who does not study science might not know much about certain esoteric laws of physics or of logic. The person who does study science has a clear knowledge advantage over the person who does not. The same with other fields such as law, or computer programming. New knowledge will be easier to grok by people who have previous knowledge because knowledge compounds on itself.

So if we assume according to science that the cognitive abilities of a person is limited (we can cite Dunbar's number to show an example), then we could also deduce that decision making abilities of an average person not augmented by technology or genetic engineering will not be able to keep pace with accelerating complexity.

I am skeptical that the current forms of government can scale into the future as society becomes order of magnitudes more complex than it is today unless transhumanism. It means that in our future our politicians and Presidents will likely have to become cyborgs to keep up with the complexity.

Transhumanism can allow us to transcend our human cognitive limitations so that we can become more effective decision makers. The technology which can facilitate our arrival at the cyborg stage of human leadership should be priority. The primary problems of poor decision making are below:

• Attention scarcity
• Information asymmetry
• Complexity

In representative democracies Senators and Congress must be well informed to vote on behalf of those whom they represent. Attention scarcity puts a hard biological limit on the quality of the decision making during a time where the stakes are rising. Information asymmetry can mean the latest in scientific knowledge doesn't reach the representatives in time. How can we help these decision makers make better quality decisions?

In the markets attention scarcity expresses itself often. Shoppers simply don't know what they are buying in many cases because they do not have the attention span to research every item before they buy it. In the case of products most people do not have the time to read the terms of service to know what they are agreeing to in exchange for using the product or service. How can we help shoppers make better quality decisions?

If you liked this article you can check out the full version here or buy the book titled: "Envisioning Politics 2.0: How AIs, cyborgs, and transhumanism can enhance democracy and improve society (Transpolitica) Kindle Edition)"