Smart contracts and civil disobedience
Blockchain technology and smart contracts are considered the holy grail when people talk about automation of law and agreements. No longer would we need lawyers, judges and other kinds of arbitration to solve our conflicts as we pour all our predefined rules and agreements into smart contracts. But do we actually want this?
We all know now that the term “smart contract” is actually a misnomer. Smart contracts are not smart. Quite the opposite actually. A smart contract is nothing more than a simple execution of a command that is irreversible. As soon as you accept and sign a smart contract by depositing your cryptocurrency, it is locked in the blockchain until an oracle tells the contract to release it.
It leaves no room for discussion or debate whether the product or service met your expectations, or wasn’t some fraud ripping you off. A smart contract can’t do anything with subjective perception. It needs unbiased data from an oracle in order to execute. The creator of the smart contract can exploit this by feeding the oracle with false input and gone is your money.
In the real world people have conflicts, miss deadlines, fail to meet agreements or to comply to rules, because sometimes we need to. So we need the ability to disobey the rules of engagement with one another.
But now imagine smart contracts being used by the government to enforce regulations on their citizens. A perfect enforcement of regulations already takes place in the case of speeding, for example. This is straightforward because speeding is speeding, and this is always dangerous right?
Now let’s take it a bit further. Imagine a police camera registering a car with a driver who is calling on a cell phone. The computer sees the incident as an unlawful act of driving while calling on a cell phone. This violation is considered indisputable and the fine is immediately deducted from the driver’s bank account.
What the camera did not register, however, was that the driver was calling the doctor because his son was having an epileptic seizure on the back seat. By the time he reaches the doctor’s office, the driver cannot buy a parking ticket because his last USD 200 were taken out of his bank account by automatic enforcement of his fine. Because of this, he reaches the doctor to late and, well, you get the idea…
The driver could probably get a refund for his fine later due to special circumstances. But he needed the money then, not now. If the situation was handled by a real life police agent and not a camera, the police agent would have appraised the whole situation and done “the right thing” : be disobedient to the traffic law and let the driver drive on quickly. He even could have given him an escort instead of a fine.
Take a step further and the police could combine information from the driver’s public records, such as his traffic violation record, tax returns, health records, travel records, housing registry or chamber of commerce information in its fine. This is where it gets really ugly.
We tend to forget just how intrusive these “efficient” and “facilitating” technologies are for our privacy. The great danger here lies in the premise that rules are by definition “good”, that disobedience to these rules is “bad” and that automatic enforcement actually serves all that is “good”. We can all imagine one or two finger wagging politicians who would put forth such a claim.
Government regulations should never be seen as inherently “good”, and should always be left to interpretation by a human on behalf of the state. And let’s not forget that the laws themselves only exist by virtue of a majority of the votes in their favour. And, as Thoreau put it, “majorities simply by virtue of being majorities do not also gain the virtues of wisdom and justice”.
Therefore, a liberal and free society offers its citizens not only the right to disagree but also the possibility to disobey. A perfect enforcement of regulations does not allow for such room to maneuver. We would do well to remember that it is disobedience to rules that brought forth momentous achievements in western society: the birth of democracy after the French revolution, the independence of the United States, the end of slavery, decolonization, the 1960s revolution…
Let us hope that this list does not end here, because seeking perfect enforceability of small matters such as traffic fines is but a stepping stone towards a police state where citizens are enslaved to a system with no way out. With artificial intelligence and blockchain technology ganging up on our private spheres, now more than ever we should understand and vigilantly protect the values that western society is built on.
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LegalThings, a company from Amsterdam, the Netherlands, has worked out a system of contracting that uses the benefits of blockchain technology without taking away the freedom to (non-)perform. It is called “Live Contracts”. For more information on this, visit livecontracts.io.
