·  Legal News, Analysis, & Commentary

News & Politics

NV May Let Firms Run Local Governments

— February 15, 2021

Nevada Gov. Steve Sisolak’s bill would let tech companies create and run local governments. We’ve seen this show before, though, and we know how it ends.

The undue influence businesses exert on government has been a legitimate worry as long as there have been businesses and governments. Ideas run in cycles, though, as people forget about past failures we’ve tried before and start thinking they’re hot and fresh again. One of these retreads rolled out of Nevada last week, where Democratic Governor Steve Sisolak plans to introduce a bill that would allow tech companies to create and run local governments.

So, what would it take for them to run local governments in Nevada, supposing this bill passes? Lots of land, and lots of money. Applicants would have to own 50,000 acres of undeveloped, uninhabited land all within one county, but not part of any existing city, town, or tax-increment area. They would also need $250 million on hand, with the ability to invest another $1 billion in their fiefdom over the next decade. Nevada isn’t playing penny poker here; if you want to play you have to pay.

Companies would also have to trade in “innovative technology.” According to the Las Vegas Review-Journal, that’s limited to “blockchain, autonomous technology, the internet of things, robotics, artificial intelligence, wireless technology, biometrics and renewable resource technology.” If it sounds like a narrow field of potential applicants, that’s because it probably is. One Jeffrey Berns, the CEO of Nevada-based Blockchains LLC, aspires to invest a grubstake in Storey County, a slice of rural Nevada some 12 miles east of Reno. He’d like to build a community of 15,000 homes with associated commercial and industrial spaces over the next 75(!) years, and his proposal is the basis of Sisolak’s bill. Firms like his would have the authority to collect taxes, form courts and schools, provide services, and eventually run local governments independent from county oversight.

An old car rusting away beside an abandoned business in a remote Nevada ghost town.
Begging for re-innovation? Nelson Ghost Town in Nevada. Photo by raduranga, courtesy of Wikimedia Commons. CC BY-SA 4.0

Berns’s vision for his “innovation zone” is a paradise where residents document their entire existence on (you guessed it) blockchain. Not only would goods and services be purchased with digital currency, but their medical history, financial statements, and personal data would be stored that way, too. Quoth Mr. Berns, “there’s got to be a place somewhere on this planet where people are willing to just start from scratch and say, ‘We’re not going to do things this way just because it’s the way we’ve done it.’”

But we have done it that way. Company towns boomed in the United States during the late 1800s and into the 20th century. Sometimes they were pragmatic solutions for remote locations, but even then, a lack of transportation and the company monopoly meant exorbitant prices for necessities like housing and food. Workers were always subject to their employers’ whims when job loss also meant the loss of their home and community. Unionization was next to impossible; workers couldn’t collectivize to demand better conditions. Everything existed for the company’s profit. It sounds like the only modern update coming out of Nevada’s proposal to let companies run local governments is that any corporate scrip would be recordable and traceable cryptocurrency. Yay?

It’s reminiscent of Elon Musk’s plan for Mars, where he stated that international law would not be recognized. Musk also suggested that would-be Martians could exchange their labor for the cost of travel. Why are these “innovative” tech bros so bereft of ideas that they need to reinvent such low points in history as indentured servitude and the company town?

This isn’t the first bad bet to be considered in Nevada. When governments too often stand as the only organization big enough to protect everyday Americans from the damages dealt by every profit-motivated corporation between Wall Street and Silicon Valley, letting techno-libertarians and their companies run local governments is a stunningly bad idea. There are better solutions out there. Let’s find some.

Related: Bolivian Coup About Racism, Batteries


Bill would allow tech companies to create local governments
Will corporation-owned smart cities come to Nevada?
Nevada bill would allow tech companies to create governments
In Nevada desert, a technology firm aims to be a government
Company Towns: 1880s to 1935
Michigan’s Forgotten Christmas Eve Massacre
Elon Musk: A New Life Awaits You in the Off-World Colonies—for a Price
Elon Musk’s SpaceX Will ‘Make Its Own Laws on Mars’

Join the conversation!