On the Frontier: An Interview with Esther Dyson

From the Wild East of Russian capitalism to the evolving forms of cyberspace, Esther Dyson likes the promise of unsettled territory--and the challenge of civilizing it.

"How [Esther] Dyson makes her living is hard to classify," Claudia Dreifus wrote recently in The New York Times Magazine. Actually, it is not. Dyson is a cyberguru–perhaps the only one who's matter-of-fact.

Dyson has advised the Clinton administration directly through the National Information Infrastructure Advisory Council and Gingrichite Republicans indirectly through the Progress and Freedom Foundation's various activities. She chairs the Electronic Frontier Foundation and sits on the board of the Santa Fe Institute. Most of the time, however, she's a knowledge entrepreneur: Customers pay a pretty penny for her thoughts on the implications of new technologies for business, law, and culture–and for her ability to bring together people whose ideas catalyze each other, creating yet more new inventions. She publishes an influential newsletter, holds high-priced conferences, and invests in Eastern European ventures.

But there is nothing grandiose about Dyson. She doesn't talk of "revolution" or call the Internet "the most important invention since fire." Eschewing grand theories, she prefers to reason from real-world developments and a few key observations: the economic value of time and attention, the inescapable fact of tradeoffs, the morality and productivity of freedom. The Times dubbed her "the most powerful woman in the 'Net-erati'," a back-handed compliment typical of our era. Dyson's achievements and insights have very little to do with her sex.

She travels constantly, at home anywhere there are interesting people and a swimming pool for her daily workout. REASON Editor Virginia Postrel caught up with her at her office in New York City for an interview in February, with follow-up questions after the first Russian elections in June.

Reason: How did you first get interested in Russia?

Esther Dyson: I had taken Russian in high school, but then I hadn't done anything with it. I'd always wanted to go to Russia but I was busy with my day job. Then [in 1989] the head of Computer Professionals for Social Responsibility mentioned that he was going to Russia [in April]. I said, "Oh great! Can I come along and translate?" And he called my bluff. So I spent two days in intensive Russian training. The first thing I had to do was learn by heart a two-paragraph explanation of who I was, so I could say to anyone I met, "Good morning. My name is Esther Dyson. I publish a monthly newsletter." It was very clever.

We were invited by something called the International Computer Club, which was more like a trade organization of computer users–big Russian banks and ministries. After about three or four days, some delegation of genuine German businessmen showed up, so the Russians pretty much abandoned us. I had a few names of some programmers. One of them was the guy who wrote Tetris. So I called him up at home–and I was very nervous because he was so famous. He was very nervous because I was this foreign American lady. He didn't know who I was, but he was sure I was very important. We became quite good friends.

In the space of three weeks, I met a fair bunch of the guys who were just starting those little programmers' co-ops, and everybody was talking about starting businesses. One man said, "This is going to be great. The government is going to set free market prices." This was when everybody was not going to work, or at work they were watching the First Congress of People's Deputies on television. It was clear that within five or six months there would indeed be free market prices set by the government, there would be a democracy–it was just obvious that everything was going to work out. It was a time of wonderful optimism and illusion that was totally unfounded. And I came back and I wrote a piece for the newsletter, which I eventually rewrote for Forbes.

In October I got invited back. And again, it was very interesting. We went to Tallin, to St. Petersburg. It was a different bunch of people. Then again in December I got asked back. This was more of an official trip. It was just horrible–Soviet apparatchiks giving a speech, then the translator giving a speech. After the first day I just said I was sorry, I was sick, I couldn't go. And I called up some of the programmers I'd met and had a wonderful, wonderful time. I tacked on three days in Hungary over Christmas on my way back. That was the period during which the Ceausescus were executed in Romania. I realized I was homesick for Russia, which is bizarre, because I was supposed to be homesick for getting back to the U.S.

That was when I decided that I was going to keep doing this as half of what I was doing–just somehow try to foster Silicon Valley in Eastern Europe. Having seen a non-market economy, I suddenly understood much better what I liked about a market economy.

Reason: Which was?

Dyson: Number one, that it works. Number two, that it's moral. Not always, and not everybody in it is moral, but the system is, I think, a moral one.

Reason: How?

Dyson: In the sense that people who produce things and work get rewarded, statistically. You don't get rewarded precisely for your effort, but in Russia you got rewarded for being alive, but not very well rewarded. A worker's paradise is a consumer's hell. People were beaten down. Everybody drank too much. Everything was hostile and dysfunctional. It was a good education about why the U.S. was a better place.

So I started thinking about all this kind of stuff, and complex adaptive systems. I joined the board of the Santa Fe Institute. I became a real free market fanatic. I'm probably less so now than even two or three years ago.

Reason: Why?

Dyson: Well, take the evolution of the Electronic Frontier Foundation. It began as hackers' rights. Then it became general civil liberties of everybody–government stay away. But the more you think about these things, the more you realize there is no simple answer like, "Government is bad." Or, "Government should do everything." You have to be a grownup. You have to decide what government should do and not do. And what's its appropriate size and what's its appropriate scale.

Since I became chairman, I've tried to turn EFF into civil liberties and responsibilities. I would much rather see responsibilities exercised by individuals than have them imposed by the government. But there is a corollary to freedom and that's personal responsibility, and the real challenge is how you generate that personal responsibility without imposing it. Having spent time in Washington–starting with the EFF and now with the NII Advisory Council–that's been extremely educational. Mostly it's been not terribly inspiring.

Reason: What have you learned?

Dyson: Oh, that all the things my father [physicist Freeman Dyson] had told me about how disgusting Washington is are true. And again it's the system–there are lots of nice, well-meaning people there. But it's a sleazy place. And politics is all about doing favors.

When I go to Russia I talk about corruption, which is really bad there–it's not perfect here either. It's usually subtler and gentler, but it exists. It's a rare politician who takes $10,000 and then votes for a bill. But his friends are in the corn business, so he understands the corn point of view. And who's going to give him money? Well, the corn people. So he's not on the take, but his world view is influenced. It's usually much more subtle than wads of cash being handed around. I've seen disgusting excess in business, and I've seen disgusting excess in Washington. But at the same time, I've certainly learned that Washington matters and that you can't ignore it, especially when you get into telecom.

Reason: You were in Russia for the general presidential election. What do you make of the situation now?

Dyson: Extremely cheerful. You never know what is going to happen, but it looks very good. It was just wonderful to be there. Every night you'd come home and turn on the TV, and some other jerk was being fired by Yeltsin. He's getting rid of some of the bad actors. It's not going to be easy, but there is a sense that we can get on with it now, where there wasn't before.

Reason: You're not concerned about Lebed?

Dyson: I'm concerned about lots of things, but given the alternative, it's extremely cheerful. My big concern about Lebed is that he thinks the way to cure corruption is to come down hard on it. The better way to cure corruption is to have openness. What I'm thinking about more and more these days is simply the importance of transparency, and Jefferson's saying that he'd rather have a free press without a government than a government without a free press.

Reason: How does that apply in the Russian context?

Dyson: Well, they have a "free press," but they don't have an honest press, and they certainly don't have openness. For example, right before the elections the press was free and made a free choice to be untruthful. But I'm glad to see that after the elections they are now printing some unpleasant truths about Yeltsin and his crew. Still, there is the presumption that things are secretive, business is secretive. Nobody knows who got their money from where. It's debilitating.

You need fewer laws, other than disclosure. I don't care how much you spend on your election campaign as long as I know how much it is and where it came from. I think I have the right to know what Steve Forbes paid in taxes–I don't think there should be a law. I think there should be a presumption. I wouldn't vote for a guy who wouldn't reveal what he paid in taxes. That kind of thing. And the Russians certainly don't have it. If a woman shows up in a fur coat, I just assume she's a crook. And that's me, the nice American. The assumption that you can't make money honestly is a killer.

Reason: But some people do manage to make money honestly?

Dyson: A lot of it is you hire people to do the dirty work like importing. There's almost no way of doing importing honestly, because if you do you're at such a disadvantage competitively. So people spend huge amounts of effort getting around stupid laws and not paying taxes. If everybody paid their taxes the government would have way too much money. But as it is, the crooks benefit at the expense of people who try to be honest.

Reason: Let me ask you about some articles, all from one day's Chicago Tribune. First, "China Orders Internet Users to Register with the Police." This kind of article, which we're seeing more and more of, both foreign and domestic, calls into question the claim that the Internet and technology make government irrelevant and freedom inevitable.

Dyson: There are two versions of the answer. One is, of course. The Chinese government controls everything. What you saw in Russia was that the law didn't matter and probably still doesn't matter. But in the old days, there was always some law that you didn't know about that you could have broken. If they wanted to put you in jail, they would. Somewhere, somehow you had broken a law. Or they could say that you had broken a law. Or they could get three neighbors to testify. Because the neighbors had children–everybody had something that made them vulnerable. So a government can control–and a really vicious government can control close to absolutely. What they cannot do is allow the Internet and allow commerce and get the economic benefits, and still control people. That's where the contradiction comes.

The control in Russia was sitting in Moscow. But what made the system so devastating was that it was your neighbors, the factory where you worked–your entire life was circumscribed by people who were similarly under the yoke. It's a very interesting, strange thing. I have a lot of close Russian friends who are open. And I keep trying to ask them, "What was it like growing as a child? What did your parents tell you? When did you know the system was bad?" You never get a clear, American answer. The answer I actually came up with is–I tried this before and it works–how much do you think about bestiality?

Reason: Me? It does not really cross my mind, except vis à vis Internet censorship.

Dyson: But you don't think about not thinking about bestiality. You don't remember your parents telling you that this was disgusting and you shouldn't think of it. It wasn't something that if you were a normal kid you thought about a lot. And as a grownup you don't remember not thinking about it.

And if you said to a Russian 10 or 15 years ago, "So how often do you think about making a profit?," the answer would be sort of the same: "I don't think about making a profit except when you talk about the bad American system. But why would I think about it? It's not that I remember my parents telling me that it was bad. I just sort of knew growing up it just wasn't something you discussed. People weren't supposed to want to make a profit."

So it's very hard, even now–there is so much fuzziness in how Russians think about most of the world. It wasn't bestiality, it was making a profit. It was freedom. It was being able to talk about things. It was that the police were always on the take and you couldn't say it. There was so much that you just weren't supposed to think about. A lot of our traditions of thinking clearly about things and resolving conflicts just aren't part of the normal psyche there. And that's why you go to Russia and they expect the government to set free market prices.

Reason: Article number two: "No Sure-Fire Way to Shield Children from Online Smut." This basically argues that neither the law nor the various kinds of software screens that are out there can be a surefire way to shield children.

Dyson: Just as rules about bookstores and the age of children going into movies aren't enough to shield them from film smut or book smut or buying cigarettes. The world is imperfect. Part of the problem is when we bring in a new technology we expect it to be perfect in a way that we don't expect the world that we're familiar with to be perfect.

Reason: The third article is: "Clinton Plan Would Put Computer in Every Classroom." It says, "Clinton wants to spend $2 billion on a program whose goals include modern computers in every American classroom and library and data linkages between them, effective and engaging educational software to run on the machines and training for teachers on how to use them." This is a $2 billion program, but there's a McKinsey study that estimated that if you really want to do this it will be $47 billion.

Dyson: This study was one product of the NII Advisory Council. One of the fundamental underpinnings of all this is that the federal government should not be funding it. It should be funding things like clearinghouses and demonstration projects, but [the full project] should be a local effort, funded either by local taxes or local corporate donors–it should be managed by local parents and school boards and community centers.

Reason: Some people, such as EFF co-founder John Perry Barlow, have suggested that copyright is obsolete, that we should do away with protection for intellectual property.

Dyson: I have a more complicated point of view. I think copyright is moral, proper. I think a creator has the right to control the disposition of his or her works–I actually believe that the financial issue is less important than the integrity of the work, the attribution, that kind of stuff. But I also feel that often anyone who attempts to enforce that too fiercely ends up being shunted aside, because the best way to get your works known is to give them away for free.

I think that the use of copyright is going to change dramatically. Part of it is economics. There is just going to be so much content out there–there's a scarcity of attention. Information consumes attention, and there's too much information. The notion is simply that attempting to make money off copies of things is usually not the right business strategy. It is an entirely moral and proper approach, but it's rarely going to be effective.

Reason: So what kind of strategies do you foresee?

Dyson: From the business point of view–not to overstate it–intellectual property is dead; long live intellectual process. Long live service; long live performance. The intellectual assets should be distributed for free, and then you should use them as advertising to charge for speaking, consulting, for software support–for T-shirts. The Lion King is great advertising for T-shirts, baseball caps, lunch boxes. To me Java [software] is advertising for Sun Microsystems. And my newsletter–

Reason: Which is not cheap.

Dyson: If you meet me at a conference, I'll give it to you for free. But if you want a steady supply, a subscription, I will charge you $600. Again, you give it away once or twice for free to hook them on the serial, on the subscription, on the membership. But people are much less likely to pay for one copy. They will pay for a stream, for a performance, an experience.

Reason: The Net will also make possible very small charges.

Dyson: Now that's the most interesting question. A lot of people say that maybe you can't charge $2.00 a page, but could you charge five cents a page? You probably could, but you're going to be competing with pages for zero. And so some intellectual property will be charged for and some won't. But the overall price levels are clearly down.

Reason: You had an interesting statement about reengineering: "Reengineering is supposed to be about continual change and not a one-time shift to something else permanent." I've used similar language to discuss conflicting philosophies of government–open-ended futures versus the technocratic attitude that says, "We like change, but our change is we're going to switch to this and keep it that way." A lot of people are profoundly uncomfortable with–

Dyson: –continual change.

Reason: Then that translates into politics, and you get Pat Buchanan.

Dyson: This is something that you see most intensely in Russia. There was this woman who was interviewed on CNN, I think it was after the second coup, and she was asked if she was optimistic. She was not an old lady, she was not a specimen, she was supposed to be the voice of the future. She said, "Yes, I'm fairly optimistic now. Now maybe we'll get what we were promised." And that was scary.

To go back to your question about change–the emblem of the tragedy is the 50-year-old man who has been as honest as the system allowed him to be, who tried to care about the work he was doing. Now all these people are saying, "Your life was a lie. Communism is corrupt. Everything that you worked so hard to achieve is a sham, but you're too old to be part of the future." To be 50 and say your life is a waste is the worst sort of tragedy, because it's too late to fix it, you've lost the 50 years, you're not dead yet, and you have to go on living with this knowledge.

Change means that what was before wasn't perfect. People want things to be better. They certainly complain all the time about their problems, but at the same time [it's hard] to be told that the rules by which they lived, the assumptions on which they based their lives, that these things were wrong–and that's what change implicitly means. When you get a haircut and people say,

"Gee, you look really great," you always wonder, "What did I look like before?"

Reason: What you describe happening to the 50-year-old Russian is an order of magnitude or two greater than what is happening here, but it's really the same thing that's happening to people at AT&T.

Dyson: Exactly.

Reason: Their work was a lie at some level–there were thousands of people who were not really adding value and whose jobs had come out of sheltered monopoly status–and yet they worked hard and played by the rules.

Dyson: They believed in what they were doing.

Reason: Change needs to occur and ought to occur, and it ultimately is better psychologically for us as a society. But in the individual case, it can be really terrible.

Dyson: It can destroy people. And so could living the lie destroy people. This is the thing: Life is not perfect. Again, Russia makes all these points so much more clearly. The transition to a more fair system is very unfair. You talk about corruption, and again, take this 50-year-old. He's a factory manager. The system was you would manage the factory and you got a very small salary, but you got a nice house and you also had control of assets. You didn't own anything, but you could put your brother-in-law in charge of the factory cafeteria. It was understood. Just like a company car in the U.S., or more so in Europe.

Now somebody comes along and says, "We're going to get this new fair society and we're going to privatize your factory, and I'm sorry but you don't own anything. You're not going to get a share in this factory because that's not fair. Just because you worked here for 40 years." Is that fair? Had the rules been the same from the beginning, he would by now have a very nice house that he owned. He would have a pension. He would be doing very well as this factory manager. The transition to a fair system cuts him off with nothing. A lot of those people will say, "Well, I deserve this. When the factory goes private, I'm going to sell a chunk to my brother-in-law before it goes private, and then he'll take care of me." And then somebody comes along and says, "That's incredibly corrupt." And it is. But it's just not as simple as it looks.

Reason: Given the fear of change, what do you do?

Dyson: First of all, you have stories and legends and role models. The role model is a person who goes through changes, makes mistakes, tries again. The company goes bankrupt but the workers go and get new jobs at other companies.

I had a lot of successes, but what really made me fearless was my complete failure at Ziff-Davis [where she was hired to start a newspaper, which flopped]. Once you've lived through that, you know you can survive, and you're not as scared. Everybody should have a real failure, ideally when they are pretty young, that gives them a sense of confidence. I think that was one of Steve Jobs's problems. He was successful for way too long before it finally hit him. There's nothing to build confidence like real achievement, but also like real failure.

Reason: Bouncing back from real failure.

Dyson: Genuine achievement gives you a sense that you can do stuff. And genuine failure gives you a sense that you can survive being imperfect. Because the delusion that you're perfect–or that if you just do the right thing, things will always work out OK–makes you resistant to change and fearful of failure. Again, you'd rather not discover that you're imperfect, that maybe what you were doing was wrong. The more people can go through those discoveries the better.

Reason: There seem to be a lot of people in the high-tech arena who are comfortable with change, with a dynamic sense of the future. Is that because people with those attitudes are attracted to those industries, or do those industries create certain attitudes?

Dyson: Usually it's both. People come into it and it feeds on itself. Even between Silicon Valley and Boston, it's much more dynamic in Silicon Valley. Those tendencies are encouraged. That kind of behavior and attitude is rewarded. I don't think you're born with it, which is why I think I can bring some of it to Eastern Europe.

As I said, people need models of how this works, they need stories. There's this guy in the Czech Republic who is truly wonderful, Roman Stanek. He's young, he's successful, he's a good model. He started his own company; he was the Informix distributor, and then he went to work for PowerSoft, and then they got acquired by Sybase. I was involved–not invested, but watching, advising, counseling all the way through. I asked him to speak at my conference last October in Slovenia. He talked a little bit about his life and how it had changed. Then he talked a little about Sybase and the things they were doing wrong and how they were going to fix them, because he was now going to be in charge of Sybase for the Czech Republic. He was funny. He was eloquent. He admitted his mistakes. He talked about how he would fix them. What he said was perfect.

There were three guys from Oracle [a Sybase competitor] in the audience, sitting together, smirking: This is great, Sybase is revealing all its problems. So then I did my duty. I got up and said, "I'm listening to Roman, and I want you to understand that what he's doing is brilliant, and I think he's doing the right thing by admitting his mistakes. I know there are people from Oracle sitting in the audience. But what I want you to get out of this interchange is that everybody knows Sybase had these problems. The people from Oracle know, Sybase knows, Sybase's customers know, but the ability for Roman to admit this–his ability to acknowledge his mistakes and to improve–is a model of how business should be done." That is how I'm trying to change the world, by finding [Eastern Europeans'] own models of success, not just discovering them, but lauding them a little and making them more visible.

Reason: Why do you want to change the world?

Dyson: It's more fun than not changing the world. I've said this so many times, but if I were a maid, I'd like a dirty room. I like building things. But again, I'd rather be a gardener than in construction. I'd rather go out and water the plants and clear the path for the sun to shine and have them grow themselves. You can grow a lot more plants than you can ever build individual things. The plants do their own work. You just help them.