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Decentralizing the Nation-State
A Classical Futurist vision for the network states of the future
Near the beginning of the modern era — circa the Peace of Westphalia in 1648 — we saw the rise of the nation-state as the default model of political organization.
The ideal of the nationalists was that the largest unit of political organization ought to be the “nation”. The borders of states, in other words, should correspond to the border of groups of people which shared most or all of the following five characteristics:
Language (ways of communicating)
Culture (ways of behaving)
Religion (hierarchy of norms and values)
History (shared descent or a shared narrative of historical experience)
National consciousness (a shared sense of identity)
This model of political legitimacy has become the default embraced by most of the world for the majority of the modern era. Thus, it has become seen as natural for nations — whatever their size — not only to be self-sovereign but to be united under the aegis of one government.
If a group with “national consciousness” is deprived of a state, like the Czechs or the Slovaks prior to the dissolution of Czechoslovakia in 1993, the nationalist paradigm says it is only right for them to want to “liberate” themselves from inclusion in a multi-national political structure and form an “independent” country.
Meanwhile, attempts for one nation to control others are derisively labeled imperialism, whereas the attempt of parts of a nation to part ways from the rest is termed secession.
The use of these words, with their associated connotations, indicates that there is a certain scale and type of polity that is seen as legitimate in the modern international order — namely the type which matches the borders and scale of a nation.
Pluralist empires like Rome or city-states like those that comprised mainland Greece — the forms of political organization that preponderated in antiquity — have, meanwhile, fallen out of favor in the modern world; although, as recently as the first world war, empires were still prominent in world affairs (the Ottomans and Austro-Hungarians). City-states like Singapore are the exception that proves the nationalist norm.
Nevertheless, the nation-state model is increasingly becoming a relic of the 18th century. It is predicated on the dying premise that shared languages, culture, religion, and historical experience accurately superimpose over shared geography.
The Rise of Nations
To understand why nation-states are living on borrowed time, we must understand how it was that nations and geographies came to coincide in the first place — not perfectly, but well enough for nationalists to make the argument that the nation-state was a natural model of organizing political boundaries.
Up until very recently (~1500), human network structures were overwhelmingly local. Before air travel and telecommunication, for instance, the vast majority of human interactions and relationships took place between people in close physical and geographic proximity.
Since network structures were mostly local (with some exceptions, like the great Houses of Europe, who intentionally married across borders to cement international diplomatic ties), the flow of language, religion, social norms, and values, i.e. the ingredients of national identity, was constricted to local enclaves.
So large changes in any of these things were usually the result of the mass movements of people (invasions, mass migrations, or conquests). This is one of the reasons why military events were so pivotal in the story of human history; they were not just transitory changes in regimes — they had network consequences, and therefore cultural and identitarian consequences.
Before Alexander’s conquests, the Near East spoke mostly Semitic languages. Afterward, they spoke mostly Greek. Before the Saxon invasions of England, the language and culture of the Britons were Celtic (and the government Roman). Afterward, the culture took on a decidedly Germanic tinge, and an invading tribe (the Angles) gave their name to both the land and the language. Plenty of other such examples.
So, with the exception of massive conquest and displacement or extermination of peoples, homogenization of identity and culture could only take place at local scales in the early part of history, which implied a great deal of diversity and fractionalization of identity, language, and religion that early nationalists would have to contend with in order to enact their centralizing program.
This became easier with the invention of mass media technologies (starting with the printing press) and faster transport (starting with the transatlantic vessel). Culture, identity, and eventually national conscientiousness could scale more quickly and coalesce around the great burgs of Europe like Paris and London which were the seat of political power.
The modern era was one where the state manufactured nations as much as vice versa. Centralized authority and centralized culture at the scale of tens to hundreds of millions.
For Political Organizations, More is Different
A collection of distributed city-states are more robust than a nation-state
Nothing about the rise of the nation-state — a relatively recent phenomenon and therefore far less “lindy” than the more polity types like the ancient tribe, city-state, or empire — is inevitable.
Modern political institutions are breaking under the weight of numbers.
Liberal democracies have historically been highly effective at small scales — the Athenian democracy had perhaps 150,000 citizens at its zenith in the 5th century BC. The Venetian Republic boasted 180,000 in its heyday in the 15th century AD. The Dutch Republic, in the high modern period, managed an order of magnitude increase with perhaps 1.9 million citizens.
Republics work at small scales because they are predicated on the investment of their citizens in the public good. At some point, cohesion breaks down and the centrifugal forces of internal division overwhelm the forces that cause a group to cohere.
This is precisely what happened to the Roman Republic. After doubling in size in a single generation after its conquest of the Carthaginian Empire in the Second Punic War, its political institutions became overwhelmed and unable to cope with the influx of new lands and peoples, resulting in increasingly unstable domestic politics from the time of the Gracchi (130s BC) to the death of Caesar in (44 BC) where the Republic all but collapsed and was only saved by the extraordinary figure of Gaius Octavius, who reorganized Rome into an empire.
This was possible because empires are fractal; they allow for decentralized control of large territories with local control. Persian satrapies, Roman provinces, and the principalities of the Holy Roman Empire, for example, could all have their own languages, practices, and religions without needing to cohere into a single cultural entity.
Shared government under empire looked something more like a military alliance like NATO today than it did modern analogs like China, the USSR, or the USA. In such empires, one hegemonic urban seat of power (Rome, Persepolis, or Regensburg) could command join armies for the common defense and levy tribute but rarely interfered in the daily manners and business of the various groups under its rule.
The imperial model worked for the Hapsburgs, the Ottoman Turks, the Mongols, the Abbasids, and countless other multi-national empires throughout history because municipal or regional polities don’t scale, and by retaining a fractal structure empires didn’t try. As Nassim Taleb wrote in his book Antifragile:
If you increase the size, say, multiply the number of people in a community by a hundred, you will have markedly different dynamics. A large state does not behave at all like a gigantic municipality, much as a baby human does not resemble a smaller adult. The difference is qualitative: the increase in the number of persons in a given community alters the quality of the relationship between parties.
This predicts that political structures that worked for city-states like the Dutch Republic or ancient Athens (liberal democracy) will not work for a modern nation of tens or hundreds of millions over the long term.
We are seeing this play out in real-time. Citizenship is a meaningful construct at a local scale — if you know all your neighbors or fellow citizens, then freeloading is a lot harder, while each person feels more impelled to their civic duty to people they’ve interacted with personally.
The way people handle local affairs is vastly different from the way they handle large, abstract public expenditures: we have traditionally lived in small units and tribes and managed rather well in small units.
Moreover, the centripetal force of competing against other groups is more powerful for small groups, whereas it is overwhelmed in large groups by the tension between internal clusters within the network structure of a polity like subcultures, political factions, etc.
At tens and hundreds of millions of people, centripetal forces become a lot weaker. National cohesion is predicated on the ability of central authorities to disseminate the centripetal force of national consciousness and pride — think of WWII war propaganda, for example — in order to counteract internal dissent.
Two key things have changed since the high-water mark of the centralized nations state:
Populations have grown
Information has become decentralized
Both are the result of cumulative technological innovations (antibiotics, the agricultural revolution, the internet) that are now irreversible. The centralized nation-state was not built for these conditions. And we are seeing liberal democracies wracked by turmoil and internal division (the commonly-decried polarization) as a result.
At the same time, networks are no longer necessarily local, and the ancient tie between network structures and geographies has been broken for the first time in history.
Networks are Decoupling from Geographies
The remote world is only the latest stage of this, and one which illuminates a long-standing trend that goes back to the beginning of the internet.
The moment it became possible to form network structures (not just one-to-one relationships, but entire communities) online, the world changed. Geography decoupled from networks.
This means that the flow of ideas, information, identity, values, religion, and group consciousness is no longer powered by local or regional network effects.
We’ve put all of humanity’s minds in a vast petri dish known as the internet — and the topology of the internet (the map of online relationships) will increasingly matter more to the dispersion of culture, identity, and group consciousness than physical maps.
Borders between online communities will soon become more meaningful than borders on a map, as Balaji Srinivasan has predicted with this concept of the Network State, which he defines as follows:
A network state is a social network with a clear leader, an integrated cryptocurrency, a definite purpose, a sense of national consciousness [emphasis mine], and a plan to crowdfund territory… an online community premised on a proposition into a physical state with virtual capital: a network state, the sequel to the nation-state.
While this may seem far-fetched at present, it simply projects forward from what we have already observed from historical trends, namely the following:
Groups with a shared consciousness and a high degree of network density tend to be the most cohesive.
Cohesive groups are the best basis for political organization (something advocated by nationalists in the 19th century).
In the past, networks and shared consciousness emerged along geographical lines because of a high degree of interaction between people living close together
In the future, networks will emerge independent of geographies and will depend upon the network topology of the internet
Small decentralized groups are more robust and cohesive than large, centralized groups
Therefore, network states are likely to emerge with “globally distributed, networked real estate”, as Balaji puts it in his essay.
A network state, in Balaji’s vision, is “thus an archipelago of digitally-linked, interconnected enclaves… a DAO that materializes in patches of earth, a city-state in the cloud.”
Network States and the Classical Future
At the beginning of the modern era, centralizing nation-states like France used their political borders to reinforce cultural and community cohesion. In the digital era, it is likely that the reverse will happen — culturally distinct, coherent communities will increasingly organize into their own political borders.
The civilization of the ancient Greeks prior to Alexander’s conquests provides a model for how a thriving decentralized web3 civilization without nation-states might look.
Though all Greeks spoke the same language and worshipped the same gods, and though they participated in the same rituals like the Olympian Games and the Panathenaic games, had the same sacred symbols like the Oracle at Delphi, and had a shared canon of literature (Homer, Hesiod), they differed greatly in their forms of political organization and in their manners of life.
Therefore, they were an example of a decentralized nation — one which governed itself at the local level of a city-state, while banding together when its common interests were threatened by outside threats like the Persian Empire.
Granted, there was plenty of low-level conflict between Greek city-states, as there likely would be between modern network states that result from the decentralization of modern nations.
But the point is that we have a historical precedent with the Greeks of the ancient world of how a civilization can thrive and grow while still offering a diversity of decentralized governments.
The best government for Corinth was not the best government for Athens, and vice versa. Spartan government would not work for any other Greek city (it was far too demanding).
With polarization and internal struggle engulfing Western nation-states, and with centralized authorities from central banks to tech giants increasingly seen as repressive and unsuited to the needs of its people, there is increasing demand for a decentralized future — just at a time when such a future has become possible thanks to the advent of blockchain technology.
If web3 fulfills its promise, network states will start to emerge in the upcoming decades; probably right around the time when the nation-state model truly begins to fail. With any luck, the outcome will resemble the emergence of the Greek city-states more than it resembles the dissolution of Yugoslavia.
We must work to make it so by understanding our civilizational roots. If liberal democracy is the government type most conducive to human flourishing, and if the city-state is the optimal size of liberal democracy, then let us shape web3 after the example of the Greeks.
Let the network states of the future that stem from Western nations be like a loose alliance of poleis, sharing common institutions like games and sports, defense treaties, language, and the arts, while allowing for a true diversity of thought and political structure between network states.
It is likely that following the Greek example will enable liberal democracies to flourish best in the new decentralized era.