Something between charter cities and charter schools
If we take complexity science seriously, we need to contemplate scalable charter communities
The idea of charter cities, first proposed by the economist Paul Romer, is over a decade old, and it carries a promise to lift tens of millions of people out of poverty. But at the same time, it seems this idea didn’t find a product-market fit yet. The idea of charter schools is a decade or two older, and comes from similar center-right or libertarian leaning circles. A charter is a kind of founding document that shall ensure that the school or city is well governed.
Cities in terms of infrastructure are complicated systems, their communities are complex systems
First we need to take into account that economics is still far from acknowledging and integrating the insights of complexity science that came out of Santa Fe Institute in the 1980s through a multidisciplinary effort of various scientists.
The main idea is that we need to distinguish complex systems from complicated, simple and chaotic systems. People go to a forest (complex system), they cut down trees and produce lumber (simple systems) and then build houses (complicated systems). The whole history of humanity, from building stone tools to exponential technologies, can be seen as a process of turning complex systems (nature) that we just start to understand a little bit, into complicated systems that we are familiar with for millennia. When we observe countries that we label “failed states” or “fragile states” we see glimpses of the fourth system — an increased descent from a complex system into ever greater chaos and fractal defection from various cooperative games.
Maybe a better example is presented by Jordan Greenhall — ocean is a complex system, and when we surf and get hit by a big wave we end up bellow water and we only see darkness and we lose a sense of which side is up and which side is down. In this case the best idea is to stop moving, wait a bit for a glimpse of sun to show up, and only when the barrier from chaotic into complex system is crossed and we realize which side is up, we shall proceed and swim back towards the surface.
Complex systems can repair themselves and need to experience stressors and non-chronic levels of stress in order to be anti-fragile. Complicated systems cannot repair themselves. Chaotic systems are such where you don’t know which side is up and which is down.
Many systems that we care about, such as societies, culture, minds, economy, gardens, climate, oceans, our bodies and communities are all complex systems with positive and negative feedback loops, delays, non-linear relationships and emergent properties.
Communities scale, cities don’t
In complex adaptive systems we observe fractal patterns, also called scale-free or self-similar patterns. For example, there is a certain coherence on the level of molecules, cells, organs, bodies and societies. There are so called scaling laws, for example surface to volume ratios. If you find a bone of a dinosaur, you can calculate how tall such dinosaur was, thanks to proportionality and these scaling laws.
One of the problems with finding a product-market fit for charter cities is an inadequate understanding of what Nassim Taleb calls “a cat is not a washing machine”, or what Eric Liu and Nick Hanauer call “gardens are not machines”. Gardens require having a sense of a good measure and constant care — too much water and too little water can both destroy plants. Too much water at once, or too infrequent watering can do the same.
According to Nassim Taleb, cities and city states survived for millennia, while empires crumbled after centuries, because governance is hard to scale and cities represent an optimal size. What unites Denmark and Singapore as examples of well governed countries is that they are an order of magnitude smaller and have smaller populations, than let’s say US or Russia. Another way to look at it — don’t build too big to fail companies and other structures and allow for volatility, learning through having skin in the game, feedback loops and a healthy dose of stressors and challenges.
But the idea is not as simple as: “let’s build a techno city, a silicon savannah, such as Konza city in Kenya, and they will come”. Konza city is an example of a techno city that remains on paper only, after ten years of expectations.
Much better is to start from the bottom-up. Start from schools and build communities of local entrepreneurs and startup hubs, that can scale into bigger structures. I cofounded Sote Hub in Voi, Kenya and worked for almost 10 years on a program that aims to “grow startups from rural schools”. What we find the most challenging is the soft and cultural side that is ubiquitous to any community — how to overcome the rivalrous dynamics and achieve coherence within startup teams but also among those teams and build efficient innovation clusters of startups, and clusters of hubs.
This can be further expanded into a charter city or charter cities on a county level — including the already existing towns and cities and merging with them seamlessly. Because it is more about culture than infrastructure.
What we need in terms of infrastructure:
1€ startups, 10€ smart phones, 100€ laptops and washing machines 1,000€ digital fabricators and EVs and 10,000€ modular off-grid houses and a circular economy of fablabs, makerspaces, vertical gardens and startup hubs that can grow into a town or can transform a town. I wrote about this dream more in an article called “How to build innovative and impactful startups for 1€“.
The idea of mobile banking emerged in Kenya through M-Pesa ten years ago. And in this domain many African countries are ahead of us in replacing legacy banking infrastructure with a more peer-to-peer and information-enabled telco infrastructure. Enter M-Kopa, a service that provides off-grid energy for rural homes and replaces more expensive kerosene lamps with LED lights and batteries. Think of Tesla products, but for people living near extreme poverty. We would need similar innovations in the space of washing machines, transportantion, sanitation, agriculture, etc.
The blockchain revolution brought us smart contracts. And together with IoT devices, such as Raspberry Pi Zero, one can even today not only dream about 1€ startups and 5€ euro smart devices. The problem is that these are currently far from user-friendly. And the prices of batteries and other technologies need to drop further and remain on an exponential curve for a bit longer, if we want to see e.g. 1000€ digital fabricators that can produce finished products, and not just prototypes. The same goes for a dream of 1000€ electric mobility solutions, that are reliable and user friendly and can be charged quickly and off-grid. Think of something like a Suzuki Jimny, but electric and super cheap.
Houses are a category on their own. Currently there is a trend of tiny houses and cohabitation as a reaction towards housing crisis that looms in many big cities. But the solutions in this space are currently too expensive or they lack the circular economy component.
The EcoCapsule is a Slovak startup that has an ambition to come up with some cheaper solutions, but they have first started from the top-off the market, a similar strategy to Tesla and others. Their mobile off-grid home in a shape of a capsule, fits into a container and costs around 70k euros.
PassivDom is a Ukrainian company, that produces dom.ai, an intelligent autonomous and self-sustainable home. But their solution is priced similarly and would need to be an order of magnitude cheaper to hit the markets of developing countries. Especially because it is difficult to get a mortgage on such houses. There are many other innovations in the area that we can broadly call space industry and smart materials that might enable much cheaper houses through techniques such as biomimicry and already mentioned smart and meta- materials with exponentially dropping prices.
Once can also think about how to make charter cities using modular homes out of repurposed and recycled shipping containers, but include all the smart and off-grid and clean technology. Such modular units can be used also for vertical farming and as fablabs, maker spaces and startup hubs. You can create basically almost anything with containers and very quickly — including kindergartens, schools, hospitals and factories.
But the overall point is simple — thanks to exponential technologies and progress in complexity science and computer science, etc. one can build charter villages, or charter cities out of modular components within weeks and doesn’t need to wait for decades to do a randomized control trial on another Dubai, Shenzhen or Hong Kong.
What we need in terms of culture, mental models — scientific concepts, mindsets and mental debugs:
I listened to an episode of 80k Hours Podcast with Mark Lutter and Tamara Winter on Charter Cities. I listened to a half of the show, and I am yet to finish listening the whole episode. But this article is a kind of reaction to what I heard so far.
It seems to me that that according to Mark Lutter and others from the Center for Innovative Governance Research what is the biggest bottleneck to lifting millions out of poverty is the low ranking in Doing Business Index and e.g. a prohibitively high cost of starting a business.
This might be in fact one of the main problems, but it is probably not a root cause. There might be many other invisible policies, cultural practices and mental models — bottlenecks (low hanging fruits, weakest chain links, biggest nodes in the network of problems…) that prohibit effective entrepreneurship.
And it might be also just a side effect of generational and near-extreme poverty. Similarly — the vast majority of Kenyan population was unbanked only a decade ago. Now most people have mobile banking accounts. The reason was that it was too expensive to service rural populations with near-extreme poverty levels with the legacy banking infrastructure.
One might think that the problem is on the level of game theory and that we need to create all-win-win games and escape the zero-sum games and zero-sum transactional mentality. One might think that this mentality is due to the environmental reasons of economy based on scarcity. There are thinkers such as Daniel Schmachtenberger, Brett Weinstein and others who contemplate a Game B — an economy of abundance based on the anti-rivalrous foundations. Daniel Schmachtenberger calls rivalrous dynamics the “generator function” of many if not all existential risks.
But the problem of rivalry might be yet deeper than game theory. Contemplating rivalrous dynamics itself is two levels deeper than the current prevalent thinking in Effective Altruism — below existential risks and below their generator functions. But it might well be that the scarcity is actually generated by the rivalrous dynamics itself, and not just vice-versa — that scarcity breeds rivalry.
At least this is the view of mimetic theory devised by Rene Girard, professor at Stanford and a mentor of Peter Thiel whose book Zero to One is greatly influenced by mimetic theory. But scarcity and rivalry might reinforce each other in positive feedback loops. It is just useful to assume that this problem might be deeper than the absence of abundance economy. Girard says that people who are the most similar are the most rivalrous to each other, and therefore humanity devised scapegoating mechanisms that produce “the sacred” by externalizing the violence produced by these rivalrous dynamics and protect communities from self-inflicted violence.
The sacred throughout history contained violence in both senses of the word. Now the realm of economy (economics and political economy) is the area that tries to produce this bootstrapping mechanism of self-transcendence and create peace and prosperity by externalizing and containing violence through violent means. But this process is less and less effective, as this process of scapegoating (structurally) innocent victims (e.g. “lazy poor people”) has become more and more visible, apparent and evident in time throughout centuries. And Christianity contributed greatly to this process of unveiling this scapegoating mechanism or bootstrapping mechanism of self-transcending and creating the desired future — similar to the paradox of Puritan Ethics, and this being similar to the Newcomb’s Problem as explained by Jean Pierre Dupuy.
I further contemplated some tools and concepts in this area that touch on the areas of antifragility and complexity in my article “Towards metamodern politics”, where I explained that the next frontier is Game B and we need to first acknowledge and then overcome rivalry and focus on building foundations for anti-rivalrous economy.
In order to go beyond rivalry — to acknowledge rivalry, integrate rivalry but transform it, we need to nurture a framework change — through paradigm shift and change of hearts and minds through various mental debugs.
There are various levels of change and impact — direct change (working in a soup kitchen, building a modular smart city), scaled change (founding a company that builds multiple charter cities), systems change (creating an innovation that opens a new space of possibilities — think M-Pesa and mobile banking or bitcoin) and finally a framework change — or a change of mindset, paradigm shift, etc. (think of the acknowledgement of human rights).
Some of these mental debugs are presented by Tom Chi, who e.g. explains why we need to think about ourselves and an emergent property of the whole ecosystem and how without air and plants that produce air we don’t exist even as a concept. Other mental debugs help us to constantly learn and learn how to learn: “Knowing is the enemy of Learning”. We need to check ourselves constantly — am I in a mindset of an expert that needs to prove their knowledge or am I in the mindset of a learner.
Learning (as a different concept from education, knowing and signaling of competence) and communities of life-long learners might be the key ingredient to unlocking Game B and overcoming rivalrous dynamics and nurture the liminal spaces where anti-rivalrous social innovations can grow.
The technology to support learning communities can be something similar to universal basic income, but built on non-zero sum paradigm of investing and not redistribution. E.g. some kind of scholarship that might turn into spin-off businesses. Today we have crowdfunding and equity crowdinvesting — where you can decide to either receive some perks or you just decide to support the project unconditionally. This idea can be expanded with smart contracts and used to build learning communities of people who consciously develop in many many domains and try to escape the perils of rivalrous mentality and dynamics. Similar mental debugs as “Knowing is the enemy of learning” might help, if practiced regularly and mindfully. Tom Chi says he has collected over 200 of those.
I wanted to illustrate my thinking in the area of charter cities and charter schools and the depth of the problem.
At Sote Hub, we have managed to spin off around ten of startup companies and support dozens of others, but often these startups break into sole entrepreneurs and cofounders split. This might not be a problem always, but this is a frequent pattern we observe. And I feel that some conscious effort in building anti-rivalrous and anti-fragile communities is needed and we need to step up our game. I am excited to keep exploring this space and want to get into some rapid prototyping of social innovation ideas in this area. Please join me with feedback and suggestions or corrections.
