A clash of networks and institutions

The Labour movement column

By Anthony Painter

What links the democratic movements in North Africa to the Wisconsin union resistance to student protests and the anti-cuts movement? Actually, in substance relatively little. This is a mass democratic uprising; it’s the march of a people’s revolution say predictable voices from the left. As is usually the case, the reality is both more electrifying and mundane than that.

For what we are seeing is not a global fight for economic justice and for democracy but the tectonic friction between two different forms of society: the network society and the institutional society. And this clash will define much of the next phase of human history. Now that modernity is in thin air, transmitted from space, traveling through distributed computer networks, accessed through a metal and plastic box in your pocket, available at a price affordable by most, the technology of network society is relatively freely available.

What determines its impact is the degree to which networked people can be held in check by institutional authority. This clash of networks and institutions (of which armed forces are one) may or may not end up with a more just, more democratic world. Whether it does depends on whether the unjust or despotic can retain the power of their institutions and whether they can use new networks to further reinforce their power.

Networks are fast, disruptive, asymmetric, convulsive, mesmerising, and aggregate quickly. They can be utterly destructive as in the case of Al Qaeda. They can bring down governments as Mubarak discovered. They can facilitate mass and rapid protest as we saw in London at the end of 2010 and more recently in Wisconsin.

Markets can be network-like or institutional. The market for energy is heavily institutional whereas the hedge fund market is more like a network, defined by interactions and exchange (though this is governed by institutional rules) rather than regulatory rules. It is because modern financial markets became more networked and less institutionally constrained that they became more uncertain and risky.

The focus on the branded element of the network society – Twitter, Facebook, etc – has missed the point. There is nothing special about these ‘apps.’ There have been dozens of Facebook equivalents. It won not because of great technology or ingenious innovation. It won because it stumbled on a marketing strategy that worked: the college campus network dissemination. Even if it had not won something else would exist in its place. And networks have existed from the moment in evolution that organisms socialised. Even networked protest and revolution is not new: the civil rights movement and the Russian revolution alike relied on the power of networks for disruptive power. What is different now is the pace, cost, and consequent availability of the means of networked communication and consequently power. And this shifts the power towards networks and away from an institutional society.

There is a problem with this, however. Networks tend to be better at pulling things down than creating an alternative. Institutions are better than networks at preserving standards, maintaining stability (up to a point), and achieving desirable outcomes over a long period. To illustrate with a current example, the response of the Japanese authorities to the earthquake and the resilience of the country is down to expertly crafted institutions. This weekend’s earthquake was 900 times the magnitude of the one which hit Haiti in 2010 yet the loss of life has – god-willing and so far – been a fraction of the 200,000 lost last year. This is down to brilliant preparation, training, regulations, and engineering. Japanese people accept that earthquakes are part of their island experience but far from being fatalistic about it, they have built an effective institutional response. Networks helped in the aftermath but it was the endurance of Japan’s institutions that saved goodness knows how many lives.

So the type of institutions you have matters as much as creating the right network dynamism and Japan is an institutional builder par excellence. This can make it slow to adapt as the crashing of its bubble economy showed as its institutions failed to contain the asset bubble that was growing and even contributed to it further as a lack of institutional diversity created a herd mentality. When things work well networks and institutions can be balance with one another: one serves as venture capital, the other as insurance. One exploits the present, the other builds for the long-term. The ideal is to balance the creative energy of networks with the long-term logic of powerful institutions.

What this means is that networks are at their best when they not only disrupt present injustices but when they quickly move to build institutions around more just and democratic alternatives. It’s easier to organise a protest – even a large one – than to build a new economy, democracy, or society. The TUC mass protest on March 26th will be a powerful expression of networked dissent to a brutal coalition attack on the value of public institutions: libraries, Sure Start, the NHS, access to education, retraining and work opportunity, social services, support for civil society and social entrepreneurship, economic development, public housing, the value and values of public service, and the list goes on. A networked movement of protest in defence of publicly valued institutions is elegant and powerful. Collectively, this networked outrage must be harnessed to create the new institutions – economic, social, and political- of social justice and democracy.

Along with vast inequality, environmental degradation, the shift from north and west to east and south, the battle between open and closed societies and markets, the conflict between networks and institutions will shape this age. Where we use the energy and innovation of networks to build enduring institutions of long term public value we will succeed. In the case of the coalition they are hoping that this will spontaneously occur – and this is at the centre of the big society. This may work in some places and contexts with networks of huge resource and capability. Too often it will not be and instead of new institutions, only chaos, desolation, and insecurity will remain.

The shift of balance from the institutional society to the network society will topple dictators, bring down governments, occasionally create terror and mayhem, create economic risk and opportunity, and quickly eliminate some traditional civic and state institutions. Things will seem stable one minute and unstable the next. Sometimes institutional power will out for good or bad (as depressingly seems to be the case in Libya- not least because of the weakness of international institutions.) Often though, institutions and their leaders will be crushed by the power of networks. It creates new possibilities alongside new risks. Our success as a movement is determined by our ability to build enduring institutions of change out of networks of outrage. Wisconsin, Egypt, Tunisia, London, have all found themselves caught in this shift. Social media is only the very superficial surface of this.

Underneath much deeper changes are occurring. Understanding these changes is essential to protecting the values of the left. We can change the world with networks. We protect our values with institutions.

Anthony Painter is co-author with Nick Lowles of the Searchlight Educational Trust report, Fear and Hope: the new politics of identity.