Fixing the Digital Economy - NYTimes.com Bob Sacha/Corbis An Internet highway of cables links routers and servers at Equinix Internet Business Exchange. TWO big trends in the world appear to contradict each other. On the one hand, computer networks are said to be disrupting centralized power of all kinds and giving it to the individual. Customers can bring corporations to their knees by tweeting complaints. A tiny organization like WikiLeaks can alarm the great powers with nothing but encryption and net access. Young Egyptians can organize a nearly instant revolution with their mobile phones and the Internet. But then there's the other trend. Inequality is soaring in rich countries around the world, not just the United States. Money from the top 1 percent has flooded our politics. The job market in America has been hollowed out; unpaid internships are common and "entry-level" jobs seem to last a lifetime, while technical and management posts become ever more lucrative. The individual appears to be powerless in the face of tough prospects. Both trends are real, and they are related. The disruption and decentralization of power coincides with an intense and seemingly unbounded concentration of power. What at first glance looks like a contradiction makes perfect sense once one understands the nature of modern power. It isn't clear when the Egyptian revolution will lead to better government in Egypt, but it is already clear that the Arab Spring increased the power and wealth of the networking companies used by Arab activists. How did we get here? A healthy middle class is essential to both business and politics. Markets cannot function without customers, and government cannot remain democratic if wealth is overly concentrated. Technological change might sometimes seem to be an automatic threat to the middle class. Operating a motor vehicle is easier than dealing with horses; people love to drive. So why should a truck driver or cabby be paid? People are still needed to do that driving, even if they suffer less than their equestrian forebears did. Unions fought for pay and working conditions that turned driving jobs into middle-class ones. In this century, however, we have forgotten that wisdom and decided that when it comes to digital networks, more and more people will not be paid for what they do even though what they're doing is needed. Jobs involving communication and expression (music, journalism and so forth) are suddenly much harder to come by, because information is now held to be free. Naturally, a 19th-century trope, the Horatio Alger story, has reappeared. With enough hard work, opportunity is said to be around the corner for young journalists and musicians. Alas, there are only a few genuine success stories. Almost everyone else in the game lives on false hope, accepting the benefits of an informal economy - reputation and barter - while helping a small, distant elite build real wealth. Instead of a bell curve, the distribution looks like a razor-thin skyscraper dragging an emaciated "long tail" behind it. The fate of journalism and music awaits every other industry, and every kind of job, unless this pattern is undone. As this century unfolds, technology will continue to evolve. More and more activities will be operated by software. Instead of Teamsters, there will be robotic trucks. Where there had once been miners, there will be mining robots. Instead of factories, there will be 3-D printers in every home. Experimental robots have already outperformed many a white-collar worker, including the legal researcher, the pharmacist and the scientific investigator. All forms of automation ultimately rely on data that come from people, however. There is no magical "artificial intelligence." When a big, remote computer translates a document from English to Spanish, for instance, it doesn't understand what it is doing. It is only mashing up earlier translations created by real people, who have been forgotten because of the theater of the Internet. There are always real people behind the curtain. The rise of inequality isn't because of people not being needed - more precisely, it's because of an illusion that they aren't even there. Jaron Lanier is a computer scientist and the author of "Who Owns the Future?"