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At 11:58 AM + on 2/24/02, Graham Lally wrote:
http://news.bbc.co.uk/hi/english/uk/newsid_1838000/1838185.stm
For those on the left side of the pond, road pricing has been big
issue in Britain, started by libertarian conservatives in the dawn of
the Lady Maggy era, and now hijacked by erst-totalitarian socialists
in political era when nobody admits to have ever been a Tory.
I expect, nonetheless, that if BritGov attempts to do road-pricing
with centralized book-entry transactions and GPS transponders,
instead of with a simple digital bearer cash toll system, such a
system would choke, just like the original proposal to have central
automated control of the Bay Area's BART system falls down, even now,
30 years after they tried it originally.
If such a top-down, positive control system did work, however, it
would probably still create an infrastructure where the adoption of a
streaming bearer cash toll structure would so undercut the installed
system on transaction cost that it would be cheaper to literally sell
the roads to the abutters in the long run -- resulting the the
fulfillment of that long-standing libertarian wet-dream, selling the
roads.
So, totalitarians, and transportation bluenoses and busybodies should
be careful of what they wish for.
For an example of that, remember what happened to telephony. The
industry demanded from the state a Morganized monopoly to prevent
ruinous competition. In exchange for same, the various local
political machines controlling the nation-state required universal
service to keep the mob from voting them out of office, and to create
a larger pool of depositors in the political favor-bank.
It took a quite a while, but the creation of a so-called natural
monopoly eventually backfired on both of them. Universal service
required automated switching to prevent requiring a significant
percentage of the population (half of all females was the apocryphal
statistic) from becoming telephone operators. As a result,
electromechanical switching (rotary dial) begat electronic switching
(touch-tone; Shockley invented the transistor for the phone company,
remember?), which, in turn, begat microprocessor switching and
Moore's Law.
The resulting exponential drop in the price of switching completely
inverted the economies of scale of network operation, changing its
very structure from an increasingly larger, more unified hierarchy
with exactly one fixed-price circuit-switched route from any two
nodes to a massively geodesic network with a combinatorical number of
routes between any two nodes, each route with its own possible
auction price depending on latency, noise, and lots of other factors.
The result was a dramatic reduction in transaction cost, price
discovery, market entry, and of course firm size, and ultimately a
dramatic increase in the number of phone companies, even vertically
integrated ones, and we haven't even started cash-settlement of
network bandwidth yet. (The paradox, of course, is that every
information worker who sits in front of a microcomputer to work
these days, sizeably more than half the female population -- even a
MacDonald's cashier -- is doing exactly what a
turn-of-the-20th-century telephone operator does, reprocessing and
routing information from one part of the network to another.)
Someday, the same thing will happen to roads, and to electricity, and
to natural gas, and to any system requiring the movement of one
ostensible commodity from one place to another, including physical
goods in the commercial distribution chain, with internet bearer
bills of lading and warehouse receipts being traded against
instantaneous internet bearer cash settlement -- just like cars
paying internet bearer cash to a road's intersection nodes as they
travel down it.
Cheers,
RAH
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R. A. Hettinga mailto: [EMAIL PROTECTED]
The Internet Bearer Underwriting Corporation http://www.ibuc.com/
44 Farquhar Street, Boston, MA 02131 USA
... however it may deserve respect for its usefulness and antiquity,
[predicting the end of the world] has not been found agreeable to
experience. -- Edward Gibbon, 'Decline and Fall of the Roman Empire'
