The Virtual Expatriates and Exurbanites of Silicon Valley

October 23, 2013

Tim Carmody writes about media, technology, business, and culture. Formerly senior writer at Wired and senior reporter/features writer at The Verge...

Something unusual happened at Y Combinator’s Startup School, an event for budding entrepreneurs in Cupertino: along with the typical testimonials, case studies, and motivational maxims, an influential co-founder of a Silicon Valley startup said something positively noteworthy.

Take a guess which one I’m thinking of:

“I believe the biggest mistake entrepreneurs make is that they follow algorithm instead of creating their own path to success.” — Dan Siroker, Optimizely

“The best ideas come from direct experience.” — Chris Dixon, Andreesen Horowitz

“Startups are one lucky break after another.” — Diane Greene, VMWare co-founder

“Don’t even bother trying to avoid mistakes, just learn from mistakes.” — Mark Zuckerberg, Facebook

“Stay present. Drink only lemon water and red wine. Stand up straight. Say hello to everyone.” — Jack Dorsey, Twitter/Square

“We need to build an opt-in society, outside the US, run by technology… We need to run the experiment, to show what a society run by Silicon Valley looks like without affecting anyone who wants to live under the Paper Belt… The best part is this, the people who think this is weird, the people who sneer at the frontier, who hate technology, won’t follow you there.” — Balaji Srinivasan, Counsyl

Srinivasan’s talk, “Silicon Valley’s Ultimate Exit,” was written up by CNET’s Nick Statt, who noted that its tone was more comic and philosophical than fire-breathing secessionist manifesto. (The opening slide asks, “Is the United States the Microsoft of Nations?” “Codebase > 230 years old, in obfuscated language” is a caption for the US Constitution; “System shut down for two weeks straight,” referencing the just-ended US government shutdown; “Systematic FUD on Security Issues” for a picture of Edward Snowden; “And yet the world has no choice but to buy it…” beneath a photo of an aircraft carrier.)

Srinivasan was then lampooned by The Verge, Valleywag, New York, and others. Coming so soon after multimillionaire venture capitalist Chamath Palihapitiya appeared to revel in the US government shutdown “proving” that the US’s real power center was Silicon Valley and not Washington or Wall Street, and the always-popular San Francisco conversation-starter “Could San Francisco Automate BART Workers Threatening To Strike?,” the trend line seemed clear: Silicon Valley’s tech leaders, and the writers and engineers who share their ideology, aren’t just disconnected from civic problems facing the rest of us, they’re looking for a way to separate themselves completely from US and local sovereignty, creating a new technology-driven utopia.

For his part, Srinivasan feels he has been misunderstood. The son of two physicians, Balaji co-founded his genomic screening company Counsyl with his brother Ramaji in 2007. One of MIT Technology Review’s 35 Innovators Under 35, Srinivasan’s company scans the DNA of an estimated three percent of all parents in the United States (about 120,000 births each year) for inheritable genetic diseases.

It “looks like there has been a bit of telephone with respect to the original presentation,” Srinivasan writes me in an email. “I’m not a libertarian, don’t believe in secession, am a registered Democrat, etcetera etcetera.

“This is really a talk that is more about emigration and exit,” he adds. “The US is a nation of immigrants, so it’s also a nation of emigrants. There’s nothing wrong with thinking about leaving the country of your birth in search of a better life, especially when children are worse off than their parents for the first time in US history. Most of this country originated from people who did exactly that. Contrariwise, most of the population (in any country) likes it just fine and doesn’t want to leave.”

The lecture draws a contrast between “voice” and “exit,” referencing Albert Hirschman’s 1970 book Exit, Voice, and Loyalty: Responses to Decline in Firms, Organizations, and States. Voice, says Srinivasan, is about changing the system from within, through lobbying, fielding electoral candidates, or public calls to action. Exit is about creating a new system that is not obligated to the rules of the old. Exit and voice go hand in hand; exit amplifies voice, since it shows that there are alternatives that individuals are actively willing to explore.

And Srinivasan is right: low-level forms of exit are happening everywhere, and global technology is helping to drive it. The Internet can substitute for official print and television channels as a source of news and entertainment. Bitcoin is a nonsovereign currency shaped by cryptography and distributed via peer-to-peer networks that anyone anywhere can use. Srinivasan’s Counsyl and other “quantified self” companies claim to put medical information back in the hands of customers, not hospitals or insurance companies. There are parallel protocols in place that, in the words of John Perry Barlow’s 1996 “A Declaration of the Independence of Cyberspace,” show “governments of the industrial world, you weary giants of flesh and steel… You have no sovereignty where we gather.”

Even in the 1990s, Barlow was already invoking a well-established rhetorical tradition pitting the rules of the Internet against the laws of governments, and it’s that tradition that Srinivasan is drawing on, too. The lecture really just gathers bits and pieces of ideas already in circulation, put forward by voices much more influential than Srinivasan’s or Palihapitiya’s.

“There are many, many exciting and important things we can do but we can’t do because they’re illegal or not allowed by regulations,” Google CEO Larry Page said at this year’s Google I/O developer conference, floating the idea of a technology version of Burning Man, the temporary festival and intentional community. “As technologists, we should have safe places where we can try out new things and figure out the effect on society and people without having to deploy into the normal world. People who like those kind of things can go there and experiment.” Wired’s Mat Honan smartly satirized Page’s dream in an article called “Welcome to Google Island.”

Billionnaire PayPal co-founder Peter Thiel, who unlike Srinivasan does describe his politics as libertarian, is putting his money behind seasteading. This is exactly what it sounds like: offshore communities on floating barges where entrepreneurs can live, work, and create new rules in international waters. Thiel described his interest in seasteading in 2011, shortly after donating over $500 million to the Seasteading Foundation, run by conservative economist Milton Friedman’s grandson Patri, a former engineer at Google. Says Thiel:

What attracted me to seasteading is, it’s linked to the technology question. We have this question about: Where in the world can one do new things? There’s a technological version of that, and there’s also a “Where can we build new communities and new societies?” All the critiques of utopianism apply to seasteading, just as they do to a lot of people in the tech industry. At the same time, I think there’s also a problem of giving up on all utopian ideas and having no theories about how things can be different or better. And saying that, “This is how things are, nothing can ever be different or better.”

The reason the seasteading question’s been so interesting is that a lot of people do think that we can do much better as a society. And if you run the thought experiment, could we be doing things better in our society, people may disagree on the particulars, but an awful lot of people think things can be done dramatically better…

It’s a very parallel question that comes up when people start companies versus working in large existing companies. In a large existing company there are set ways things have happened. Sometimes there’s a sclerotic bureaucracy that’s taken things over. You can change things at the margins, but you often cannot change the fundamental fabric. The reason people start new companies is because there’s a need to have a certain amount of freedom to explore doing new things. That’s why you’d start a new business. There’s a question: If you can start a new business, why can you not start a new country?

For Thiel, these new utopian states don’t need to be libertarian; the kibbutz movement, as he points out, was a leftist idea of utopia that seems to have petered out. The important thing for him—well, let’s not bullshit here: the most important thing for Peter Thiel is creating a libertarian technolaboratory for himself and his wealthy friends. But the second most important thing is linking the idea of utopia with technology, with a dream of solving big problems—and Thiel convincingly identifies many big problems that we face. Finally, the third most important thing to him—and it is not to be discounted—is resurrecting the idea of utopia itself.

There are many, many problems with seasteading, both intellectual and practical, just as there are with libertarianism. In 2007, novelist China Miéville wrote about what he called the “degraded utopia” of seasteading, with specific reference to the Freedom Ship, a giant cruise liner intended for 40,000 wealthy cosmopolitans to live and experiment outside the reach of law, but which was never completed.

Utopias at sea, Miéville writes, have to understand what they are: pirate ships, where genuine outlaws can create their own communities, or privateers, the advance guard of empire:

Libertarians are political dissidents only in narrowly selfish directions. As respectful of “order” as the most polite bourgeois, they cannot conceive of pirates as antecedents, only as threats. (As indeed they might be, were there any seasteads to plunder.) By distancing themselves from this antiestablishment hydrarchy, the libertarian seasteaders unwittingly identify with […] the imperialist, maritime state. Coercive political apparatuses, operating internally and externally, are implicitly, sometimes explicitly, part of the libertarian seasteading project.

(The buccaneer fantasy is a popular one. As Steve Jobs famously once said, “it’s more fun to be a pirate than to join the Navy.”)

What does a technologically driven expatriate community look like? In “The Future of Civil Disobedience Online,” Molly Sauter identifies a very different kind of digital nomad, sharing some of Srinivasan and Thiel’s criticisms of the United States and other states, but decidedly opposed to coercive politics. “Where activists once put their physical bodies on the line to fight for their causes, online activists can engage in digitally-based acts of civil disobedience from their keyboards,” Sauter writes. She identifies “three major lines along which digitally-based civil disobedience is developing: disruption, information distribution, and infrastructure.”

Of these, the last is the closest to Srinivasan’s image of exit:

Infrastructure-based activism involves the creation of alternate systems to replace those that have been compromised by state or corporate information-gathering schemes. In other words, if the government is snooping on the internet, activists build a tool to make it harder for them to see everything. Tor, Diaspora, and are some examples of these projects, as are the guerrilla VPNs and network connections that often spring up to serve embattled areas, provided by activists in other countries.

Similar to living off the grid, these projects provide people with options beyond the default. Open source or FLOSS software and Creative Commons use a similar tactic: when the system stops working, create a new system. The challenge is to bring these new systems into widespread use without allowing them to be compromised, either politically or technically. However, these new systems often have to fight network effects as they struggle to attract users away from dominant systems. Diaspora faced this issue with Facebook. Without being able to disrupt dominant systems, user migration is often slow and piecemeal, lacking the impact activists hope for.

Juxtapose the very real work done by online activists to create alternate structures for living, working, and communicating in cyberspace with the model proposed by Blueseed, one of the seasteading communities Peter Thiel has invested in, targeted at “foreign entrepreneurs who have difficulty obtaining visas to live or work in the US”:

The founders plans to register their seastead—which could be a cruise ship or an oceanworthy barge—in a country with a reputable legal system, such as the Bahamas or the Marshall Islands. That nation’s laws would apply, and they also plan to voluntarily follow U.S. public policy on topics like illegal drugs.

Their eventual goal is to attract up to 1,000 entrepreneurs who want to live a short ferry’s ride away from Silicon Valley, with its unsurpassed network of tech investors, law firms, suppliers, and social opportunities.

That is not exit; it’s an exurb. Its goals and motivations are exurban. Its function is to express class status and petty disinterest in regulation. It is a utopia only in the sense that it cannot possibly function in the absence of the infrastructure of the nation state whose laws, protections, and investment in its citizenry they claim to renounce. It is, by definition, parasitic. It is the oldest story in the history of industrial urbanism. And it is very, very real.

Miéville thinks that libertarian seasteaders are not to be taken seriously. “There are dangerous enemies, and then there are jokes of history,” he writes. “The libertarian seasteaders are a joke. The pitiful, incoherent and cowardly utopia they pine for is a spoilt child’s autarky, an imperialism of outsourcing, a very petty fascism played as maritime farce: Pinochet of Penzance.”

I’m less sure. It doesn’t matter whether we agree with its ideological underpinnings or not, whether we think it is practical or fair. It doesn’t even matter whether Balaji Srinivasan fully agrees with its ideological underpinnings—he has his finger on three things that are happening, whether we like them or not: the slow disintegration of the nation-state’s legitimacy, the emergence of an increasingly rootless nomad class of digital workers, and their counterconcept, a new kind of gated community where citizenship becomes not a right, but an escape.

Tim Carmody writes about media, technology, business, and culture. Formerly senior writer at Wired and senior reporter/features writer at The Verge. Follow him on Twitter at @tcarmody.

Image by Anthony Ling, via

Tim Carmody writes about media, technology, business, and culture. Formerly senior writer at Wired and senior reporter/features writer at The Verge. Follow him on Twitter at @tcarmody.