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If you could talk to me a little bit
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about how Estonia has changed,
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technologically speaking,
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socially, economically,
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from the time you took office to now.
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I mean, leaving aside that we went through
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a very severe economic crisis,
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which I guess, I mean,
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we're still feeling some of the aftershocks of that,
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though I'd say we're doing rather well.
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I don't know, 2007, 2008,
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we rolled out digital prescriptions,
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and I don't know if you know,
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in the United States,
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5,000 people die a year because of doctor's bad handwriting.
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[laughs] So it's very simple.
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I mean, it's all,
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when you go to the doctor,
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he writes the prescription into the computer,
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and then you go to any pharmacy in the country
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and you stick in your ID card
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and put in your code,
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so you identify yourself and then get your prescription.
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In the beginning, it was everyone,
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oh, this is terrible, this is terrible,
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it's not working.
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And so there were some glitches.
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But within four or five months,
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all prescriptions were online.
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I mean, no one wanted paper prescriptions anymore.
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I mean, if you offer a service
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that is incredibly reasonable and rational,
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then people will use it.
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Secondary fact is that that is possible
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precisely because we have a universal ID,
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that the service would not have been built out
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unless everyone knew that,
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well, I mean, that everyone could use it.
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This does not eliminate paper prescriptions.
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I mean, if you really want one,
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you can have on, but no one does.
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And also because it's much easier to renew, right?
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You don't have to go see the doctor.
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Yeah, you can call him up and say
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I ran out of whatever,
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and then, you know just, okay.
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He'll type it in, and then you'll go to the pharmacy.
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Small part of my vision for where Europe should go,
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is that this would work across the continent.
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If you get sick in some other country,
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you would go to the local pharmacy in Spain,
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stick in your card,
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and then you would get the medicine
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that your doctor in Estonia prescribed.
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And that is very, very slow going,
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because, again, it's where the stumbling blocks
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are not technological.
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It's not there yet,
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but at least between two countries,
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Estonia and Finland, we will have this
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in operation.
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It will be the first time this kind of service
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would operate across borders,
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but it's complicated because, I mean,
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you have different countries,
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different governments subsidize different drugs,
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different degrees, so you have to balance
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all that out so people don't start
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going cross-border for arbitrage,
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and all those things.
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The other side of what we're doing with Finland
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is that our system X-Road,
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distributed data exchange layer,
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a sort of enterprise service bus,
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using more or less blockchain technology
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for certain things like medical records.
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It's also open source, non-proprietary software,
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which we developed initially,
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and Finland and Estonia are
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now working together on version seven.
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We will implement version seven, we hope, next year.
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It will then allow us to actually use
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all these services across borders,
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across the countries.
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At least in northern Europe,
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I say northern Europe because I don't think
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the rest of Europe is that keen on things.
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It is going very slowly.
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Europe is even more resistant than the United States.
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There are a number of reasons.
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I mean, first of all, there's a fear of competition.
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There is a protectionist sort of undercurrent
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in many things where companies
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don't want to have competition from U.S. companies.
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The problem with the protectionist approach
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is that protectionism, the old economy.
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You would have technological progress at a linear rate.
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So, you take the United States
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in the 1970's, 1980's,
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Detroit didn't want to have competition,
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forced through 15% tariffs
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against Japanese and German cars.
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German and Japanese cars got better and better,
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and people were willing to pay
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the extra 15% to have a German or Japanese car.
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It is simply true that when it comes to IT
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we're operating at a non-linear,
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with a non-linear progress.
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I mean, Moore's law,
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even the exponent is dropping a bit.
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It is exponential.
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When you get protectionists in that area
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all you're going to do is,
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you're going to fall further, and further behind.
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In Europe, take iTunes.
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iTunes are based on credit cards.
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Credit cards are national.
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I cannot buy my wife, who has a Latvian credit card,
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I cannot buy her an iTunes record,
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because I have an Estonian iTunes.
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This is true of virtually everything
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that is connected to digital services.
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Certainly, this is why Estonia is
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at the forefront of the push for
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something called the Digital Single Market, or DSM.
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We understand that unless Europe develops
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a single digital market, we will fall behind.
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Right now, I like to say,
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it's easier to ship a bottle of Portuguese wine
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from southern Portugal in the Algarve,
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up to northern Lapland,
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and sell it there,
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than it is for me to buy an iTunes record
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across the Estonian, Latvian border.
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Laughs
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Which is unfortunately true.
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Laughs
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This mindset in northern Europe,
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there is less of that protectionist attitude.
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There is a greater willingness
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to move ahead in tech,
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and south of Denmark, basically,
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you have the Netherlands that really gets it.
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The Netherlands is very, very good on these things.
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UK gets it.
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One reason why we're concerned
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about the UK voting to leave the European Union
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is that it's the biggest country
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that kind of gets it.
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Well, I would hope that by 2018,
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when Estonia holds the presidency
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of the European Union, that we,
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in fact get a lot of the legislation done
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that is required for that.
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The different cultural attitudes,
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of course, Snowden didn't help.
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It created this kind of mindset,
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a misunderstood concept of privacy.
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We can't have a digital identity
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because the government will know something about us.
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Well, I mean, you could also
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stick to horses.
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It is irrational, because if you actually
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talk to these people,
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they don't understand the nature of an ID card.
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An identity is something that,
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is the secure identity is the
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sine qua non for any kind of progress
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in any kind of, for technology in general.
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More broadly I would say the BITNET model
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of the internet, which is that
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everything is based on an address and a password.
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I mean, it's creaking so badly already.
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One of these days it's just going to crash.
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Most hacks that we've seen that
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have been really dangerous could be
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avoided by simply having two-factor authentication.
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I find it unconscionable that, in fact,
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data are stored on an unencrypted form
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as it apparently was in the case of the OPM hack.
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That worked for a thousand people,
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three thousand people,
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across the academic world.
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Three billion people online,
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this is no way to run anything.
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Very, very insecure.
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In the sort of old Lockean model
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of the relationship of the citizen to the state,
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the best example of this is
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actually the U.S. Constitution,
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which is the citizen gives up certain rights
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to the state, and the state in turn
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guarantees things such as security,
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rule of law, legal system,
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right to free speech, and so forth.
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And, that's kind of the product of
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the Scottish enlightenment of
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the early Eighteenth century.
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Western liberal democracy is
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based on that understanding.
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New role in this age is the state
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is the guarantor of your identity.
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What the ID gives you is
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you sign a legal contract.
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Every time you transfer money with your ID,
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it's tantamount, it's equivalent to
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signing a check, and you will yield,
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and it's probably more secure than
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if we sign a check because it's [laughs]
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no-one can forge your signature.
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That is completely different from having a password.
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And a little paradox about all that,
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most averse to an identity are
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UK, Canada, United States, New Zealand,
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and Australia.
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Germany has a very strong one,
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yet at the same time I don't understand
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how they can continue without having,
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actually, a solidly guaranteed identity.
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I'm an e-resident.
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I became an e-resident last year.
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As somebody that's not an entrepreneur,
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who doesn't need to start a startup in
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Estonia tomorrow, I got it sort of as an exercise,
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but I really don't quite know what to do with it.
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One thing you can do,
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this is an interesting case also
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because of the objection,
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you can in fact send very encrypted e-mails
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to other people who have that.
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And then people say, "Well, why won't
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terrorists do it?" I go, well, I point out that
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if you, in order to get an e-residency
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you have to provide your fingerprints, so,
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I mean we know who you are, so.
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This does touch on one other thing,
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which is that we are strongly against
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any kind of back doors,
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because basically, again,
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the whole system would collapse
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if there were a back door.
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Because, the whole system is based on trust.
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The state, on it's side,
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has to offer that trust and guarantee
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that there will be no back door,
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which is one reason why we're,
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you know, the whole discussion of back doors
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that has taken place also here in the U.S.
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Soon as you allow for back doors,
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then the trust disappears, and then
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of course, the system itself
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is questionable.
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Yep.