Rise of the Megacorporation
The first six months of 2020 have been less than desirable. As news of the coronavirus spread in January, I, like many others, assumed that the country most at threat from the virus would be its place of origin: China. We are now nearing the end of June and it is not China whose government has proven ineffectual and whose cities are burning; it is the United States of America.
A block of Seattle has declared itself an autonomous zone, refusing police entry and effectively establishing their own sovereignty over this small territory. Swathes of Chicago are in ruins as rioters and looters tore through local businesses, murders spiraled out of control and aldermen are left bewildered and clueless as leadership from the city, state and federal levels is all but nonexistent. American police are abandoning their posts in a ‘Blue Flue’ to protest what they see as their government abandoning them in the face of a mob, who in turn accuse the police of being nothing more than mafia abusing and killing American citizens at will. If this was not enough, the coronavirus is returning with a vengeance.
The federal and state governments are paralysed by their post-war byzantine bureaucracy, and competing interests have all but colonised the various wings of government. ‘The State’, as a self-interested actor hierarchically above all other political interests, no longer exists. The question as to whether state consciousness can be painstakingly reconstructed is in the air, but we are losing the moment in which this can be accomplished.
Some hold hope that the imperial core will reform itself; others have already devoted themselves to ideas of localism or even secession. What exactly the future holds for the Union is unknown, but I would like to think about one possible future: the rise of the megacorporation to fill this governance vacuum. This does not require clairvoyance to see, as the radically individualist worldview of the American individual may well predispose them taking matters into their own hand, eschewing federal and state government in favour of localist, private initiatives. Vast swathes of the country may come to be effectively governed by megacorps that provide laws and regulations, security, and other essential services (utilities etc).
This is not a historical anomaly. Colonial chartered companies such as the British East India Company, the Dutch East India Company and the Hudson’s Bay company all commanded thousands of troops, governed territory and established laws, all the while pursuing the ultimate aim of profit. These megacorps acted as a wayhouse between the medieval kingdom and the modern nationstate-cum-empire. Kingdoms could not afford to extend their rule to distant colonies, and much of the early imperial expansion of these various Sovereigns was undertaken by the private initiative of adventurers and traders with royal charter to claim land and trade for the Crown. As the fiscal and technological power of the kingdom grew, it eventually followed the megacorps across the seas and enforced direct imperial rule, absorbing their infrastructure (government, laws, and security), and thereby condemning it to the pages of history.
If history teaches us anything, it is that what once was can be again. So, what could a 21st century megacorp look like? Large, roving private entities that create horizontal and vertical monopolies across utilities, security, laws and regulations, thereby establishing a parallel ecosystem of governance. In essence, it would be Security/State as a Service. Such services could include charter cities and private militias, something I will explore in this article. The potential for such a complex to rise again is simply a function of imperial complacency, the rise in market demand, and the enterprising spirit of adventurers and inventors.
Autonomous Zones and Charter Cities
The Capital Hill Autonomous Zone (‘CHAZ’) is an aspirational Marxist-Anarchist commune ruled by a rapper-landlord turned warlord, and whose key export is currently memes. The CHAZ ‘model’ offers one possible vision into the future of America: autonomous zones run by radically democratic councils and “security” (if one can call it that). But we can do better than this.
The concept of the charter city may receive increased interest as a potential vehicle for private governance. Its most vocal proponent is Mark Lutter, founder of the Charter Cities Institute. Originally centred around the development of special economic zones (SEZ’s - with more autonomous governance) in developing countries by guarantors from developed countries, the aim is to ‘administer the region, with the power to create their own laws, judiciary, and immigration policy outside of the control of the host country’.
Similar jurisdictions exist across the world, with SEZs in China, the DIFC courts in Dubai, and the up-and-coming Nkwashi, a Zambian town that the Chartered City Institute hopes will become the first charter city in Zambia. The Holy Roman Empire provides an interesting historical parallel to city-level governance, as it saw the gradual emergence of the Freie Reichsstädte – cities enjoying autonomous governance and direct representation in the Imperial diet (akin to city governments bypassing state governments and heading straight to the United States Congress).
It may very well be that Americans take inspiration from charter and free imperial city models to begin lobbying for the insertion of a new layer of governance in the Union – that of the city-state. The United States of America is an imperial entity consisting of 1 federation of 50 states, 5 self-governing territories, a federal district (Washington, D.C.) and various, largely-unpopulated islands in the Pacific. The state government is the most local form of governance in the Union and this has caused a significant backlog of problems, glaringly exposed in the incompetent response to the coronavirus and how many Americans simply took matters in their own hands to keep their families safe.
The city-state occupies the goldilocks zone of governance. It is small enough to understand the intimate needs of its citizenry (Nassim Taleb has been one of localism’s most vocal proponents and has written at length on the matter), but it is also large enough to ensure a sustainable level of prosperity and security, and is therefore unlikely to be replaced by larger organisations.
Throughout the coronavirus crisis, city governments in America have proven to be just as incompetent and dysfunctional as their superiors. The charter city could act as a basic template for the quick legal and economic setup of new city-states in America, with the economic element of the charter city model being of critical importance. For a city to survive, it must be sustained both with basic needs as well as being towns of trade and prosperity. Its evolution is hoped to be something akin to Singapore’s: an island city-state that rose to be one of the world’s most prosperous nations in half a century due to efficient public administration and excellent commercial regulation.
One issue that the charter city faces is the question of sovereignty, something that is often suspended in mid-air and left for later. Governance by megacorp would be a real alternative to the imperial structure, and therefore be viewed as a threat should the megacorp decide that its interests are best served exiting the structure and becoming its own sovereign entity, i.e. a state.
However, the evidence suggests that for the most part, decentralisation on this scale is facilitated, not opposed, by the hierarchy. As such, it would not be in the megacorp’s interest to pursue sedition. With appropriate (and delicate) constitutional crafting, the imperial structure could make appropriate space for the city-state model, and then, megacorps step in and simply serve the demand.
Rise of the Uber Militia
The police killing of George Floyd was the catalyst for unleashing the pent-up energy that had been boiling over in American society; decades of culture wars, a nationwide quarantine and the economy crashing into the side of a mountain have created the most potent cocktail for social upheaval. The establishment of autonomous zones, the ‘Blue Flu’, and the wider collapse of trust in key public institutions (government, police and healthcare) are leaving many communities looking to take their security into their own hands.
Security is the essence of any human settlement. The modern army’s genealogy can be traced through history right down to the first walls erected in Biblical Jericho. Without walls and men armed with lethal objects to defend them, anyone can use force to seize property and take lives. This is often forgotten by first worlders because we have grown complacent by outsourcing our security to the state apparatuses (the army, intelligence, and police).
Much of the growth in anti-gun sentiment was driven by city-dwellers who had no need to hold guns and defend themselves since the police were always a few minutes away. Those who lived further from central police departments were closer to the basic reality of security. However, the anti-gun platform has all but collapsed as even democrats and progressives rush to gun stores in the wake of the collapse of the illusion of state-provisioned security. If federal and state security (the police) continues to withdraw from American cities, non-state actors such as highway bandit gangs, neighborhood watches and privately funded militias will rise to fill this vacuum. There must always be a monopoly of violence.
American private military contractors (‘PMC’) abound in the warzones of Africa and Asia, replacing American troops in key logistical and combat positions from Syria to Afghanistan. The military-industrial complex is flooding homeland police departments with military-grade weapons and vehicles, and surveillance equipment traditionally used to track and kill enemies abroad are now being used to surveil protestors on American soil.
The chickens are coming home to roost, and new opportunities for PMC services in the homeland are a very real possibility. If the police continue to disappear, then the demand for private security will skyrocket. This is noticeable based off social media chatter, and it is very interesting to see Americans organise, in real time, to wean themselves off the teat of state security.
Enterprising businessmen could compete to provide Uber-style administrative and marketing platforms that facilitate the exchange and even transport of guns-for-hire. Neighbourhoods may pool together their resources to either negotiate a rotational neighbourhood watch or even to purchase collective private security services from PMCs.
If we think about this at a larger scale, megacorps could step in to not only provide the charter city in which people inhabit, but also provide extensive security forces to defend these cities. The minutemen once again become a fixture of American life, although we may come to call them Uberminutemen or Ubermilitias.
If the imperial core is unwilling to reform itself, then it should give the space to citizens who yet possess this will to painstakingly rebuild governance from the ground-up, and perhaps also embed a positive vision of the good that ensures the long-term viability and moral character of this new body, something the original Founders may have failed to do. Whether any of this is desirable or not is another question, but if the imperial core does not get its act together, it may well be the only alternative for well-to-do citizens who are not interested in living in a rerun of late-stage Rome. Megacorps may not necessarily be evil as portrayed in dystopian scifi novels if decent and moral people decide to take charge in building it.