Government and Technology

by Krishna on June 24, 2011

I sympathize with Jurgen Appelo for his bad experience with US border control. After he told them that he was visiting the United States for delivering courses, he was sent back from the airport itself. Apparently, the rules state that “a self-employed independent trainer is not allowed to work in the USA“. The border officials were following the law, but it must have been a terrible encounter for Jurgen.

This got me thinking about the following scenarios, not specific to the United States, but applicable to any country:

  1. John records a course on a DVD and put it up on a website. Someone in another country buys it. The DVD is shipped and the person sees it on their computer.
  2. John records a course and uploads it for streaming on a paid website. Someone in another country purchases the course and views it on their computer.
  3. John offers his time on a paid website. Someone in another country make the purchase and John delivers a course via Skype to them live. (Some sites offering tuition for students work this way with teachers in other countries.)
  4. The same scenario except that an organization buys John’s time and John, from his home in the Netherlands, delivers a course online live to 200 participants.
  5. John visits another country and while at his hotel, meets a friend and talks to them about his course for 2 hours. The friend offers to pay for John’s meal.
  6. John visits another country for 3 weeks and every breakfast, lunch and dinner, meets a bunch of “friends” at his table and talks to them about his course. Every time, they pick up the tab.

I would guess that almost all of these activities are legal and even if some of them weren’t, no government agency has the capacity to restrict such activities. The illegal part starts when John wants to do the most productive activity, which is delivering his course directly with face time to hundreds of eager participants at the same time. Thus, low productivity is rewarded and high productivity punished. Of course, John may decide not to do the low productivity activities. And so, any knowledge that only John has is forever lost to many possible users.

Many laws across the world seem to be written this way. They look at one possible way that a native producer can lose revenue because of foreign competition, but they neglect several ways that native consumers are affected negatively by those laws, or how those consumers can bypass those laws.

To give an example, work laws in many countries place a restriction on the number of people who can enter the country. The well-meaning intent is that too many people can lower the salaries of the native workers. But companies are free to hire people in other countries to work for them. Or if they are not, they are free to partner with foreign companies or simply purchase from foreign companies. A government could decide to stop that kind of trade, but then it would be subject to retaliation on goods it exports, thus harming its own industries.

Many free-trade advocates base their arguments on the benefits of free trade to both the rich and poor countries involved. But I think beyond all that, I don’t see the alternative. There is no practical way to restrict flow of goods and human labor across national boundaries without hurting one’s own country. Of course, open borders have other problems, notably what to do about welfare state benefits for non-citizens. But I think for situations like Jurgen’s, those kind of issues are non-relevant and there should be an easy way for individuals to make visits and get paid for short engagements.

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