Statelessness and "Cyber-Scammers"

Filed under Political
As reported by Slashdot:
Barence writes "A pernicious new type of scam is targeting British computer owners, reports PC Pro. The con is both fiendishly clever and ridiculously simple. The fraudster cold-calls the customer and tells them that Microsoft has detected a virus on their PC, then invites them to download a piece of remote-assistance software. No doubt reassured by the lines of indecipherable code flitting across their screen, the caller assures the customer they can make the virus vanish – but first, of course, they want payment. £185 to be precise. The spoof site behind the scam is approved by McAfee's Site Advisor and bears Microsoft logos, something which both companies have failed to act upon. Meanwhile, an assortment of British regulators have said there is nothing they can do to stop it."

Source: Slashdot

This is a great example of what people imagine a stateless society would look like.  If the authorities aren't there to step in, how will people be protected against predators and "cyber-scammers?"  Well, in the current "regulated" environment, scammers are encouraged to think of ways around regulation.  Regulations only offer a false sense of security.  People are actually left unprotected from the scams when a simple exploit is discovered.

Compulsory "safeguards" that are required or will be required by government causes software and hardware vendors to raise their prices by embedding their regulatory costs.  After a particularly bad incident like the one in the above article, vendors will be required by government to add more fraud protection after the fact, otherwise leave the market.  In the case of the EU, it already has many regulations on the books that increase the cost of going to market.  Regulations upon regulations will also keep certain vendors out of these markets.

Regulatory costs in systems like this are hidden by the falling price of physical computer hardware (costs naturally fall in the computer industry).  But believe me, these embedded costs are there.  At some point soon, I expect government intervention in information technology will represent the bulk of the cost of information technology (it probably already has).  Regulations will also get further and further behind the latest threat from scammers.

What would be the reality in a stateless situation?  What is the solution without government regulation?

Well, since people would know there's no compulsory safety net, computers would be sold with an optional support service.  Due to the lack of embedded tax levied and regulation compliance on the sale of hardware and software, the initial price would be much lower in the stateless society.  So people who can support their own systems don't have to pay for these services.  There is no distributed penalty.

Imagine an entire computer rig, both hardware and software, that costs $50 without support service.  Then you pay another $50 for security service that expires after two years.  This security service comes with a great support package (like perimeter software with automatic updates and phone support).  After two years, you can renew the service for another $50 or buy a newer (better) rig for $50 (plus another $50 for another two years of service).

If someone manages to scam you, the computer security company pays for a new rig plus compensation for damages beyond that.  The security company then has a direct incentive to secure its customers from being scammed.  So they will make sure you're on the latest firewall software or what have you.  They will also send you understandable information about the latest scams.  For some people who need it, there would be cause to send DVDs with instructions on how to handle calls from scammers, e-mail attachments, et cetera.  Again, because they have an economic incentive to prevent fraud, there is no limit to the innovation they'll use.

And if they fail to protect on a constant basis, they run the risk of going out of business, unlike legislators do in our current situation.

Then there's competition.  Maybe another computer security company only charges $25 because they don't send training media.  Or maybe all of the computer security companies realize they are competing against your family members and geek friends who offer free support.  Maybe your geek friend will chip in to pay for some or all of the $50 to keep you from calling.  Maybe the geek friend gets a discount or reward for hooking up all his technophobe friends with a support contract.  Competition and voluntary interaction is where the free market  really shines.

Is it perfect?  No.  But it would be way better and more effective than the compulsory system we now have (and also what's on the horizon in the near future).

For more information about statelessness and what a voluntary society might look like, please consider:

Posted via email from Anthony Martin's Weblog


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