And yet zone fever burns on. With Honduras looking ever less hospitable, enthusiasts of start-up cities have begun eyeing its neighbors. In 2019, Nayib Bukele became the prime minister of El Salvador and immediately rolled out an aggressive campaign to brand his nation as a global center for another kind of exit: cryptocurrency. In November 2021, he unveiled plans for a Bitcoin City, with power generated by a volcano, and a giant central square in the shape of the Bitcoin logo.89 Proponents of the start-up city spoke at the gathering about how Bitcoin could contribute to the dream of “opting out on every layer.”90 They were in talks with Bukele about turning it into a “free private city” even as they pursued opportunities farther south in Jair Bolsonaro’s Brazil, through the University of Chicago–educated minister of the economy Paulo Guedes.91 History shows there is always another fantasy island on the horizon.

  11

  A Cloud Country in the Metaverse

  Network types

  REPRODUCED WITH PERMISSION FROM PAUL BARAN, “ON DISTRIBUTED COMMUNICATIONS” (SANTA MONICA, CA: THE RAND CORPORATION, 1964), RAND REPORT: RM-3420-PR

  While much of the action in Neal Stephenson’s 1992 novel Snow Crash takes place in a fractured geography of gated communities, private prisons, racist enclaves, and jerry-rigged refugee ships, the heart of the plot is in a place that is a non-place: the Metaverse. Characters put on goggles and earbuds to escape their gig jobs delivering pizza or packages and traverse a virtual reality in their avatars as gorillas, samurai, or dragons. They buy, sell, and develop property in the Metaverse, though the underlying land, as in Singapore and Hong Kong, is owned by a single body that reinvests the revenue into expanding infrastructure. Certain areas are exclusive, but anyone with access to a computer can drop out of everyday reality and pop up in the online world. As one character says, “When you live in a shithole, there’s always the Metaverse.”1

  In 2021, Facebook, one of the few companies in history to achieve a market capitalization exceeding $1 trillion, announced it was changing its name to Meta Platforms behind a push toward something it also called the metaverse. This metaverse sought to meld the worlds of gaming, social media, and workplace internet use by allowing you to have identities, appearances (or “skins”), and payment systems that you could carry across platforms—from chatting with family on Facebook to sitting in an office meeting on Zoom to staging a raid in a massive multiplayer online role-playing game like Final Fantasy or World of Warcraft. In the promotional video, users played a game of cards as cartoonish avatars, and Mark Zuckerberg engaged an employee in a staged conversation as a copy of Snow Crash lay on the coffee table between them.2 Other tech companies followed suit. Microsoft bought the company that produced World of Warcraft, and the pages of the business press began to fill with a term that only science fiction readers had heard of a year before.

  While the term was new to many, the phenomenon was not. The idea of an immersive online experience had featured in tech futurism for longer than many millennials had been alive. William Gibson coined the term cyberspace in his 1984 novel Neuromancer, and as early as 1992, the film Lawnmower Man featured a protagonist strapped into a headset descending into a megalomaniac rage in a three-dimensional computer space. Long used to train soldiers and pilots, virtual reality headsets entered arcades in the 1990s and were a fixture of tech-booster magazines like Wired. The 1999 hit The Matrix brought the cyberpunk idea of jacking into an alternative reality into popular consciousness at a time when one-third of Americans began to use the internet. Habbo, launched in 2000, and Second Life, launched in 2003, offered rudimentary versions of the metaverse, where avatars walked jerkily around three-dimensional rooms and cityscapes and occasionally socialized with strangers.

  As some people showed themselves willing to pay for accessories and buildings in these games, there were many articles about the novel idea of “making real money in virtual worlds” and “investing in the online property boom.”3 One person watching the numbers was the financier Stephen K. Bannon, who would later go on to become a top Trump advisor. Bannon raised $60 million in 2007, mostly from his former employer Goldman Sachs, to invest in a Hong Kong–based company that recruited low-wage Chinese workers to play World of Warcraft. By completing simple tasks, these “gold farmers” earned virtual currency and other items that could be sold to Western gamers for real money at a profit. Beyond the clever arbitrage play, Bannon credits the experience with alerting him to the extent of online energies. Bannon described seeing the “monster power” of disaffected young white men online, which he later channeled into his media platform Breitbart, one of the forums for the eruption of the alt-right after 2016.4

  It is impossible to talk about political ideology in the last twenty years without talking about the influence of gaming and the internet. While so far we have mostly looked at places in the conventional sense, recent radical capitalist visions of exit have had one eye on the everyday world and the other on the virtual. With a tsunami of money crashing into the tech sector, and later into cryptocurrencies like Bitcoin, the libertarian mind has oscillated for the last two decades between the two domains of online and off. From the late 1990s, anarcho-capitalists saw the internet as a place to strip social rules down to the steel girders of private property and contract. As we have seen time and again, their goal has been not to take a wrecking ball to the state but to hijack, disassemble, and rebuild it under their own private ownership. They built toy models of the state with real-world effects.

  1.

  The urtext of twenty-first-century tech libertarianism was published in 1997. It carried a mercenary title—The Sovereign Individual: How to Survive and Thrive During the Collapse of the Welfare State.5 The authors were the American venture capitalist James Dale Davidson and the British journalist and businessman William Rees-Mogg, whose oeuvre included a previous book called Blood in the Streets: Investment Profits in a World Gone Mad.6 (Its title references Baron de Rothschild’s axiom that “the time to buy is when there’s blood in the streets.”) Rees-Mogg described himself and Davidson as “instability forecasters” and “discontinuists.”7 Their genre was the recognized one of futurism combined with business advice—how to profit from the coming collapse.

  By 1991, they were already touting the “subversive invention” of the microchip and its capacity to “destroy the nation-state.”8 The argument crystallized around the internet, which they argued was eroding received ideas of territorial government. “Cybercash,” they said, would let people take their money wherever they wanted through anonymous transactions; as the wealthy fled high-tax jurisdictions, this portability would starve the welfare state. They combined this observation about capital flight with a speculative argument, drawn from epigenetics, that humans had entered a more rapid phase of evolution. The result, they said, would be the emergence of a hypermobile superclass of high-IQ individuals, who could remotely coordinate placid low-IQ workforces while stashing their wealth far from the grasping hands of governments.

  Davidson and Rees-Mogg called this tiny, rarefied fraction of the world’s population “sovereign individuals,” and estimated their coming number at a hundred million worldwide.9 The nation-state form was dysgenic. It worked against the dictates of evolutionary advance and survival. In an era of hypermobility, it served evolutionary interests to escape national constraints. Scales would fall from the eyes of the new global elites, they predicted. The elites would cease to see national identity as anything meaningful, and the conceit that they owed anything to their so-called fellow citizens would be laughable. They would understand that one’s countrymen were actually “the main parasite and predator,” their brains contaminated by the idea that they were owed a share of someone else’s hard-earned income.10 Sovereign individuals knew they had no obligations to anyone but themselves.

  The authors spoke of a return to the diverse political geography of the Middle Ages. “Before the nation-state,” they wrote, “it was difficult to enumerate precisely the number of sovereignties that existed in the world because they overlapped in complex ways and many varied forms of organization exercised power. They will do so again. In the new millennium, sovereignty will be fragmented once more.”11 Disintegration would favor the few. “Every time a nation-state cracks up, it will facilitate further devolution and encourage the autonomy of Sovereign Individuals. We expect to see a multiplication of sovereign entities, as scores of enclaves and jurisdictions more akin to city-states emerge from the rubble of nations.”12

  This was a model of capitalism without democracy. Since majoritarian decision-making could not deliver the choices needed for economic survival, democracies would slowly be outcompeted. They would simply wither away, no coups necessary.

  The Sovereign Individual has enjoyed an extraordinary afterlife among Silicon Valley libertarians. Marc Andreessen, prominent venture capitalist and co-creator of the first web browser, called it “the most thought-provoking book on the unfolding nature of the 21st Century that I’ve yet read.”13 Another reader influenced by the book on its release was Peter Thiel, who created the online payment system PayPal partly as an attempt to realize the book’s visions of “encrypted cybercash.”14 He said the book made him realize that success came from thinking in the time frame of ten or twenty years in the future.15

  One of the attractions of The Sovereign Individual is how it worked against what could be called the “commune story” of the internet. The commune story finds the origins of Silicon Valley in the failure of the hippie settlements of the 1970s—a failure that led people like Stewart Brand, publisher of the Whole Earth Catalog, to try building their utopias in the clean space of computer code rather than the stubborn muck of the outdoors.16 The “Declaration of Independence of Cyberspace,” written by former Grateful Dead songwriter John Perry Barlow and released at the World Economic Forum in Davos in 1996, praised cyberspace as the “new home of the Mind.” Casting the web as a kind of psychedelic dreamland, Barlow wrote that “legal concepts of property, expression, identity, movement, and context do not apply to us. They are all based on matter, and there is no matter here.”17

  Anarcho-capitalists, by contrast, argued that matter did still apply in the creation of a digitally mediated world, and that property would too. If played right, property could be even more inviolable online than off. No doubt what appealed to a conservative like Thiel about The Sovereign Individual was its recognition of this fact and its indifference to the sentimentality of the commune story. Davidson and Rees-Mogg were frank that the rewards of the new paradigm would be distributed unevenly. As they saw it, the internet would not erase distinctions, in a realization of the failed dream of the 1970s, but rather lead to a rightful hardening of hierarchy based on merit. Their vision would be borne out by events. By the year 2000, the most successful companies, including Amazon and eBay, had turned the internet into online shopping malls—privately owned public spaces, where the parameters of your actions were set by the owners, and rents were collected both from your purchases and eventually from the data produced by every motion of your cursor.18 The actual existing web was not a utopia beyond property; it was a utopia of property. It became clear that the new frontier of the web would work like the old frontier: new land to be grabbed by first movers. New territory meant new possibilities of ownership.

  2.

  Among the most articulate radical capitalist exponents of the new political geography of the virtual world was another fan of The Sovereign Individual, Balaji Srinivasan. Born on Long Island in 1980 to Indian immigrant parents, Srinivasan earned a PhD in electrical engineering from Stanford before launching a biotech start-up that offered an at-home genetic screening kit for hereditary diseases. Tipped by MIT Technology Review in 2013 as one of the leading “innovators under 35,” Srinivasan promptly entered the venture capital world, becoming a principal at Marc Andreessen’s firm.19

  In the heady early 2010s, when the American public was looking to Silicon Valley for solutions for everything from health care to education, Srinivasan became one of the most high-profile advocates for what he called, in a notorious talk, “Silicon Valley’s ultimate exit.”20 By his account, the American Northeast, previously dominant, had entered a permanent and irreversible decline. In an analogy to the Steel Belt of the Midwest, which had become the Rust Belt by the late 1970s, the “Paper Belt” of the Northeast was doomed. The paper he referred to included the laws made in Washington, DC; the newspapers, magazines, and advertising of New York City; and the diplomas of Harvard and Yale.

  Srinivasan cited Andreessen on the coming proliferation of countries, as well as Google’s Larry Page, who said in 2013 that “maybe we could set apart a piece of the world … where people can try new things.”21 Along with Thiel, Srinivasan invested in Curtis Yarvin’s company Tlon, devoted to building a new internet that would come closer to his vision of society run as a business.22

  Srinivasan did not advocate literal exit in the sense of secession. “They have aircraft carriers, we don’t,” he quipped. But he did introduce a novel variation on the start-up city that he would develop over the next decade. He called it the cloud country.23 It began from the observation that people were finding new kindred spirits online. The internet had made it possible to form affinity groups and create meaningful bonds without physical connection, often across lines of gender, geography, class, and nationality. “Hundreds of millions of people have now migrated to the cloud,” he wrote, “spending hours per day working, playing, chatting, and laughing in real-time HD resolution with people thousands of miles away … without knowing their next-door neighbors.” The result was a new geography that people had not even begun to map. He described a “cloud cartography” etched out in social networks, “mapping not nation states but states of mind.”24 Where you lived in three dimensions was less important than who you were linked to online.

  Secession and exit were emotionally loaded terms, but it was true that people were entering new forms of sociability through voluntary attachments to online games, brands, services, platforms, and companies. Srinivasan pointed to social media. Most people in a city like New York used a service like Facebook every day, but if we weren’t one of the company’s engineers or marketing executives, we had no way of knowing how many did, where, and for how long. What if the company’s flag unfurled from the window of everyone who logged on?25 Facebook blue would stream in the wind, sometimes covering whole faces of buildings, sometimes ebbing, moving like the shadow of a cloud across the sun. Watching the spreading pattern of flags from week to week and year to year might be startling and begin to look something like a takeover. Facebook went from 1 million monthly active users in 2004 to 2.4 billion by 2019, nearly a third of the world’s population. What if we thought of these as defections to a new state in utero?

  Connections to these private actors and firms could be a lot stronger than bonds to one’s nation. When did people consciously interface with their national government or think about their nationality? If you were a school-age child in the United States, you started every morning by pledging allegiance to the flag, but what about adults? Mouthing the national anthem at the occasional baseball game, showing a passport at the border if you happen to travel, filing your taxes every April, voting every couple of years. By contrast, most Americans clicked the icon of their favored social media platform once, twice, dozens, or even hundreds of times every day. For half a century, intellectuals had criticized the displacement of civic identity by consumerism.26 Srinivasan flipped the script. Why shouldn’t consumerism swallow patriotism? Aren’t companies ultimately more benign than the murderous twentieth-century state? What was the body count of Facebook or Google compared to those of Mao Zedong or Adolf Hitler? If the social media companies were dictatorships of a new kind, with power centralized in a CEO, nobody seemed to mind.

  The idea of “netizens” and online communities was hardly a new insight; what was novel was the leap that Srinivasan made from elective online communities to the possibility that the cloud might come back down to earth.27 “Rather than starting with the physical territory, we start with the digital community,” he wrote. “We recruit online for a group of people interested in founding a new virtual social network, a new city, and eventually a new country. We build the embryonic state as an open source project, we organize our internal economy around remote work, we cultivate in-person levels of civility, we simulate architecture in VR, and we create art and literature that reflects our values.”28 The numbers of members and perhaps their investments or fees would register on a publicly viewable dashboard, until a tipping point was reached where a spattering of droplets became a cloud—first a cloud town, then a cloud city, and eventually a cloud country.

  Srinivasan envisioned two steps toward the destination. To start with, exit would be virtual. People would remain where they lived, but they would be encouraged to imagine their home as an embassy for a future cloud country. Physically, the cloud country would be noncontiguous, but that was no problem. Srinivasan cited the example of Indonesia, an archipelago of more than seventeen thousand islands that nonetheless retained a strong sense of national identity since its independence from Holland in 1945. Why couldn’t digital users create their own archipelago? “It can connect a thousand apartments, a hundred houses, and a dozen cul-de-sacs in different cities into a new kind of fractal polity with its capital in the cloud,” he wrote.29