Estonia, the Digital Republic
The New Yorker · by By Nathan Heller · December 11, 2017Estonia, the Digital Republic | The New Yorker
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Up the Estonian coast, a five-lane highway bends with the path of the sea, then breaks inland, leaving cars to follow a thin road toward the houses at the water’s edge. There is a gated community here, but it is not the usual kind. The gate is low—a picket fence—as if to prevent the dunes from riding up into the street. The entrance is blocked by a railroad-crossing arm, not so much to keep out strangers as to make sure they come with intent. Beyond the gate, there is a schoolhouse, and a few homes line a narrow drive. From Tallinn, Estonia’s capital, you arrive dazed: trees trace the highway, and the cars go fast, as if to get in front of something that no one can see.
Within this gated community lives a man, his family, and one vision of the future. Taavi Kotka, who spent four years as Estonia’s chief information officer, is one of the leading public faces of a project known as e-Estonia: a coördinated governmental effort to transform the country from a state into a digital society.
E-Estonia is the most ambitious project in technological statecraft today, for it includes all members of the government, and alters citizens’ daily lives. The normal services that government is involved with—legislation, voting, education, justice, health care, banking, taxes, policing, and so on—have been digitally linked across one platform, wiring up the nation. A lawn outside Kotka’s large house was being trimmed by a small robot, wheeling itself forward and nibbling the grass.
"Everything here is robots," Kotka said. "Robots here, robots there." He sometimes felt that the lawnmower had a soul. "At parties, it gets close to people," he explained.
A curious wind was sucking in a thick fog from the water, and Kotka led me inside. His study was cluttered, with a long table bearing a chessboard and a bowl of foil-wrapped wafer chocolates (a mark of hospitality at Estonian meetings). A four-masted model ship was perched near the window; in the corner was a pile of robot toys.
"We had to set a goal that resonates, large enough for the society to believe in," Kotka went on.
He is tall with thin blond hair that, kept shaggy, almost conceals its recession. He has the liberated confidence, tinged with irony, of a cardplayer who has won a lot of hands and can afford to lose some chips.
It was during Kotka’s tenure that the e-Estonian goal reached its fruition. Today, citizens can vote from their laptops and challenge parking tickets from home. They do so through the "once only" policy, which dictates that no single piece of information should be entered twice. Instead of having to "prepare" a loan application, applicants have their data—income, debt, savings—pulled from elsewhere in the system. There’s nothing to fill out in doctors’ waiting rooms, because physicians can access their patients’ medical histories. Estonia’s system is keyed to a chip-I.D. card that reduces typically onerous, integrative processes—such as doing taxes—to quick work. "If a couple in love would like to marry, they still have to visit the government location and express their will," Andrus Kaarelson, a director at the Estonian Information Systems Authority, says. But, apart from transfers of physical property, such as buying a house, all bureaucratic processes can be done online.
"I’ll show you a digital health record," she said, to explain. "A doctor from here"—a file from one clinic—"can see the research that this doctor"—she pointed to another—"does." She’d locked a third record, from a female-medicine practice, so that no other doctor would be able to see it. A tenet of the Estonian system is that an individual owns all information recorded about him or her. Every time a doctor (or a border guard, a police officer, a banker, or a minister) glances at any of Piperal’s secure data online, that look is recorded and reported. Peeping at another person’s secure data for no reason is a criminal offense. "In Estonia, we don’t have Big Brother; we have Little Brother," a local told me. "You can tell him what to do and maybe also beat him up."
Business and land-registry information is considered public, so Piperal used the system to access the profile of an Estonian politician. "Let’s see his land registry," she said, pulling up a list of properties. "You can see there are three land plots he has, and this one is located"—she clicked, and a satellite photograph of a sprawling beach house appeared—"on the sea."
The openness is startling. Finding the business interests of the rich and powerful—a hefty field of journalism in the United States—takes a moment’s research, because every business connection or investment captured in any record in Estonia becomes searchable public information. (An online tool even lets citizens map webs of connection, follow-the-money style.) Traffic stops are illegal in the absence of a moving violation, because officers acquire records from a license-plate scan. Polling-place intimidation is a non-issue if people can vote—and then change their votes, up to the deadline—at home, online. And heat is taken off immigration because, in a borderless society, a resident need not even have visited Estonia in order to work and pay taxes under its dominion.
Soon after becoming the C.I.O., in 2013, Taavi Kotka was charged with an unlikely project: expanding Estonia’s population. The motive was predominantly economic. "Countries are like enterprises," he said. "They want to increase the wealth of their own people."
Tallinn, a harbor city with a population just over four hundred thousand, does not seem to be on a path toward outsized growth. Not far from the cobbled streets of the hilly Old Town is a business center, where boxy Soviet structures have been supplanted by stylish buildings of a Scandinavian cast. Otherwise, the capital seems pleasantly preserved in time. The coastal daylight is bright and thick, and, when a breeze comes off the Baltic, silver-birch leaves shimmer like chimes. "I came home to a great autumn / to a luminous landscape," the Estonian poet Jaan Kaplinski wrote decades ago. This much has not changed.
Kotka, however, thought that it was possible to increase the population just by changing how you thought of what a population was. Consider music, he said. Twenty years ago, you bought a CD and played the album through. Now you listen track by track, on demand. "If countries are competing not only on physical talent moving to their country but also on how to get the best virtual talent connected to their country, it becomes a disruption like the one we have seen in the music industry," he said. "And it’s basically a zero-cost project, because we already have this infrastructure for our own people."
The program that resulted is called e-residency, and it permits citizens of another country to become residents of Estonia without ever visiting the place. An e-resident has no leg up at the customs desk, but the program allows individuals to tap into Estonia’s digital services from afar.
I applied for Estonian e-residency one recent morning at my apartment, and it took about ten minutes. The application cost a hundred euros, and the hardest part was finding a passport photograph to upload, for my card. After approval, I would pick up my credentials in person, like a passport, at the Estonian Consulate in New York.
This physical task proved to be the main stumbling block, Ott Vatter, the deputy director of e-residency, explained, because consulates were reluctant to expand their workload to include a new document. Mild xenophobia made some Estonians at home wary, too. "Inside Estonia, the mentality is kind of ‘What is the gain, and where is the money?’ " he said. The physical factor still imposes limitations—only thirty-eight consulates have agreed to issue documents, and they are distributed unevenly. (Estonia has only one embassy in all of Africa.) But the office has made special accommodations for several popular locations. Since there’s no Estonian consulate in San Francisco, the New York consulate flies personnel to California every three months to batch-process Silicon Valley applicants.
"I had a deal that I did with Funderbeam, in Estonia," Tim Draper, who became Estonia’s second e-resident, told me. "We decided to use a ‘smart contract’—the first ever in a venture deal!" Smart contracts are encoded on a digital ledger and, notably, don’t require an outside administrative authority. It was an appealing prospect, and Draper, with his market investor’s gaze, recognized a new market for élite tech brainpower and capital. "I thought, Wow! Governments are going to have to compete with each other for us," he said.
So far, twenty-eight thousand people have applied for e-residency, mostly from neighboring countries: Finland and Russia. But Italy and Ukraine follow, and U.K. applications spiked during Brexit. (Many applicants are footloose entrepreneurs or solo venders who want to be based in the E.U.) Because eighty-eight per cent of applicants are men, the United Nations has begun seeking applications for female entrepreneurs in India.
"There are so many companies in the world for whom working across borders is a big hassle and a source of expense," Siim Sikkut, Estonia’s current C.I.O., says. Today, in Estonia, the weekly e-residency application rate exceeds the birth rate. "We tried to make more babies, but it’s not that easy," he explained.
With so many businesses abroad, Estonia’s startup-ism hardly leaves an urban trace. I went to visit one of the places it does show: a co-working space, Lift99, in a complex called the Telliskivi Creative City. The Creative City, a former industrial park, is draped with trees and framed by buildings whose peeling exteriors have turned the yellows of a worn-out sponge. There are murals, outdoor sculptures, and bills for coming shows; the space is shaped by communalism and by the spirit of creative unrule. One art work consists of stacked logs labelled with Tallinn startups: Insly, LeapIN, Photry, and something called 3D Creationist.
The office manager, Elina Kaarneem, greeted me near the entrance. "Please remove your shoes," she said. Lift99, which houses thirty-two companies and five freelancers, had industrial windows, with a two-floor open-plan workspace. Both levels also included smaller rooms named for techies who had done business with Estonia. There was a Zennström Room, after Niklas Zennström, the Swedish entrepreneur who co-founded Skype, in Tallinn. There was a Horowitz Room, for the venture capitalist Ben Horowitz, who has invested in Estonian tech. There was also a Tchaikovsky Room, because the composer had a summer house in Estonia and once said something nice about the place.
"This is not the usual co-working space, because we choose every human," Ragnar Sass, who founded Lift99, exclaimed in the Hemingway Room. Hemingway, too, once said something about Estonia; a version of his pronouncement—"No well-run yacht basin is complete without at least two Estonians"—had been spray-stencilled on the wall, along with his face.
The room was extremely small, with two cushioned benches facing each other. Sass took one; I took the other. "Many times, a miracle can happen if you put talented people in one room," he said as I tried to keep my knees inside my space. Not far from the Hemingway Room, Barack Obama’s face was also on a wall. Obama Rooms are booths for making cell-phone calls, following something he once said about Estonia. ("I should have called the Estonians when we were setting up our health-care Web site.") That had been stencilled on the wall as well.
Some of the companies at Lift99 are local startups, but others are international firms seeking an Estonian foothold. In something called the Draper Room, for Tim Draper, I met an Estonian engineer, Margus Maantoa, who was launching the Tallinn branch of the German motion-control company Trinamic. Maantoa shares the room with other companies, and, to avoid disturbing them, we went to the Iceland Room. (Iceland was the first country to recognize Estonian independence.) The seats around the table in the Iceland Room were swings.
I took a swing, and Maantoa took another. He said, "I studied engineering and physics in Sweden, and then, seven years ago, I moved back to Estonia because so much is going on." He asked whether I wanted to talk with his boss, Michael Randt, at the Trinamic headquarters, in Hamburg, and I said that I did, so he opened his laptop and set up a conference call on Skype. Randt was sitting at a table, peering down at us as if we were a mug of coffee. Tallinn had a great talent pool, he said: "Software companies are absorbing a lot of this labor, but, when it comes to hardware, there are only a few companies around." He was an e-resident, so opening a Tallinn office was fast.
Maantoa took me upstairs, where he had a laboratory space that looked like a janitor’s closet. Between a water heater and two large air ducts, he had set up a desk with a 3-D printer and a robotic motion-control platform. I walked him back to Draper and looked up another startup, an Estonian company called Ööd, which makes one-room, two-hundred-square-foot huts that you can order prefab. The rooms have floor-to-ceiling windows of one-way glass, climate control, furniture, and lovely wood floors. They come in a truck and are dropped into the countryside.
"Sometimes you want something small, but you don’t want to be in a tent," Kaspar Kägu, the head of Ööd sales, explained. "You want a shower in the morning and your coffee and a beautiful landscape. Fifty-two per cent of Estonia is covered by forestland, and we’re rather introverted people, so we want to be—uh, not near everybody else." People of a more sociable disposition could scatter these box homes on their property, he explained, and rent them out on services like Airbnb.
"We like to go to nature—but comfortably," Andreas Tiik, who founded Ööd with his carpenter brother, Jaak, told me. The company had queued preorders from people in Silicon Valley, who also liked the idea, and was tweaking the design for local markets. "We’re building a sauna in it," Kägu said.
In the U.S., it is generally assumed that private industry leads innovation. Many ambitious techies I met in Tallinn, though, were leaving industry to go work for the state. "If someone had asked me, three years ago, if I could imagine myself working for the government, I would have said, ‘Fuck no,’ " Ott Vatter, who had sold his own business, told me. "But I decided that I could go to the U.S. at any point, and work in an average job at a private company. This is so much bigger."
The bigness is partly inherent in the government’s appetite for large problems. In Tallinn’s courtrooms, judges’ benches are fitted with two monitors, for consulting information during the proceedings, and case files are assembled according to the once-only principle. The police make reports directly into the system; forensic specialists at the scene or in the lab do likewise. Lawyers log on—as do judges, prison wardens, plaintiffs, and defendants, each through his or her portal. The Estonian courts used to be notoriously backlogged, but that is no longer the case.