In July 2015, I was able to sit down with Dr. Lana Swartz in Cambridge, MA and talk briefly regarding her research on everyday financial technology. We were able to discuss the history of payment systems from paper money all the way to Bitcoin, as well as some of the challenges and questions that new Internet-based technologies pose for individuals, industry, and the general public.
Hello! Thanks so much for taking the time to talk! To start off, can you tell us a little about yourself and your research?
I just finished my PhD at the Annenberg School for Communication and Journalism at USC. Before that, I did a masters in Comparative Media Studies at MIT, where I wrote a thesis about intellectual property regimes and “fake” fashion. Now, I'm interested in money as culture and money as technology. My dissertation looked at the socio-technical implications of payment infrastructure, historical and emerging.
That's really interesting! I don't know much about the history of payment systems - can you give us a quick history lesson?
Sure! In the course of my research, I was surprised to learn that payment, since the beginning, really, has had a lot more in common with communication and transportation than with banking. Paper currency, like other forms of print culture, helped consolidate the nation-state as an economic territory. American Express started out as an express shipping company that competed with the Federal mail system. Charge cards emerged in the 1950s and 60s, alongside highways, jet travel, and the rental car, when suddenly people were moving a lot faster and farther than their money could. The card networks used the same networked computing systems as the early Internet. Now, as mobile devices become more powerful and ubiquitous, we’re seeing more and more mobile payment applications.
Awesome! Are you hoping to do something similar while a fellow at the Berkman Center?
Some of the most important thinking about the politics of intermediaries—like payment systems—is going on at the Berkman Center. The Berkman Center is also an important hub for thinking about next generation blockchain technology, which is something I think a lot about. Hopefully I can bring what I learned through my dissertation research to the conversation.
How much of your research is based here in the US or abroad?
For the most part my research has focused on the US. However, I do collaborate quite a bit with Bill Maurer and Taylor Nelms from the UC Irvine Institute for Money, Technology, and Financial Inclusion, which is funded by the Bill and Melinda Gates Foundation and does research exclusively on payment technology in the developing world.
It's interesting because payment is one area where sub-Saharan Africa is really far ahead of us—so to speak—in adoption of mobile money. For example, have you heard of M-Pesa? It’s an interesting example of user-generated innovation. People living in countries where the currency is unstable or inconvenient began using airtime as a form of currency, and Safaricom (the mobile network operator in the region) embraced that and developed systems around it that allowed users to continue. It's especially important in areas with limited infrastructure.
Why is this research important, and where do you see it going in the future?
Most of the time, when people think about the politics of money, they think about it in terms of economic justice: who has money, who doesn’t, why, how, and whether or not that arrangement is fair. I wanted to call attention to money as an information and communication technology. Being able to pay and getting paid is actually complicated technological achievement with many players. It’s one of those things that we don’t notice until it’s broken for some reason.
Not being able to be paid puts us in a dire situation. As we saw when WikiLeaks was embargoed by major payment intermediaries, not being able to be paid can be a powerful form of censorship and can pose a true existential threat to an organization. But beyond censorship or politically-motivated payment blockades, ordinary people face payment challenges all the time. PayPal is notorious for erroneously freezing accounts for a variety of reasons. If you search for “PayPal account freeze,” you’ll find dozens of controversies. Unless you have an army of supporters to cry foul on your behalf on social media, navigating the system to find redress can be Kafkaesque.
The payments industry is changing. We’re increasingly using new intermediaries that contact payments between individuals rather than between customers and merchants, so it’s less clear who the client of the payment service is or who the users’ advocate might be. It’s becoming increasingly assembled as part of a portfolio of social media services. There’s a growing interest in transactional data for advertising, risk management, or a variety of other purposes, so questions of privacy and context are also coming to the fore
So, what are the politics of how the infrastructures of money are managed? Who should manage it? The public? A start-up? A bank? Some kind of collective? I believe there is a strong public interest in payment, but we don’t yet have grasp of the full range of issues that need to be considered in order to have a policy debate around it. I’m hoping to close that gap through my research.
Obviously you're very familiar with a lot of different payment systems. In your opinion, which one poses the most exciting opportunities?
I think ALL payment systems are fascinating from a cultural perspective. In fact, Bill Maurer and I are currently editing a book about favorite payment artifacts by a variety of scholars and journalists. We have chapters on Dogecoin, the cutest cryptocurrency; Minitel, the French state networked computing system that predated the mass adoption of the Internet and allowed you to pay your taxes and for porn; and the Khipu, an elaborate system of knot-tying used in the Incan civilization to keep track of obligations.
In terms emerging payments technology, I have been following Bitcoin and its siblings and descendants for, wow, probably five years now. I’m really excited about the way that Bitcoin has helped explode popular interest in payment and forced people to learn more about the “plumbing” of the economy. I think that, on some level, blockchain is still a technology in search of an application. Its ultimate applications might wind up having little to with payment—or with much of the politics that Bitcoin started with.
Dr. Lana Swartz recently finished her PhD at the Annenberg School of Communication and Journalism at USC. She will be spending the upcoming year working as a post-doctoral researcher at Microsoft Research New England and will begin work as an assistant professor of Media Studies at the University of Virginia in Fall 2016.
David Eichert is currently doing research for Professor Jonathan Zittrain at Harvard Law School. In Fall 2015 he will begin an LL.M. program in public international law at the Riga Graduate School of Law in Riga, Latvia.
Dr. Leyla Keser is an assistant professor and the director of the IT Law Research Center at Bilgi University in Istanbul. While she worked on IT law since 1998, her focus changed according local and international to trends and priorities. Consequently, the research topics she works on span across many areas; they range from cybersecurity to e-government and from data protection & privacy to multistakeholder Internet governance. “A very dynamic challenging topic,” the field reveals new problems to solve almost every day.
Currently, Dr. Keser investigates the implications of the Right to be Forgotten ruling of the EU on Internet actors other than search engines. She is very curious about the economic implications of the ruling. This research topic is also what she aims to examine here at the Berkman Center. She says that most studies on the topic focus mainly on effects of that ruling on other rights such as freedom of speech, freedom of media and data protection.
“I’m so excited to enlighten the dark side of that ruling and expose economic impact on different Internet actors such as content providers, hosting providers, platform providers,” she said.
Another part of Dr. Keser’s research will be scrutinizing the impacts of the ruling on multistakeholder Internet governance.
Here in Cambridge, Dr. Keser said she would miss having Turkish breakfast at her favorite places in the Be?ikta? district, Istanbul, as well as the long walks along the Bosporus.
When asked what if the Internet had never been invented, she said, “I always prefer to look ahead and don’t want to think the times without the web. Internet and the web are the most breakthrough innovations of the humanity. They make the life easier than ever before.”