TUESDAY, AUGUST 10, 2010


‘Anonymous and ephemeral’ group is massive online force


4chan from A1


companies use to track what’s hot on the Internet, wasn’t the first time 4chan succeeded in outwit- ting Google. The site’s users have also managed to get a swastika, symbols depicting planes crash- ing into the World Trade Center and the words “[expletive] you google” on the trends list. Trying to game Google to make


a search popular is not illegal, but some of the other pranks have brought inquiries by the Securi- ties and Exchange Commission, the Department of Homeland Se- curity and the FBI. The site’s antics have also gar- nered positive attention: 4chan’s founder, Christopher Poole, re- cently raised $625,000 in funding to create a new online communi- ty. Among his investors are some of the most revered Internet in- ventors and businessmen, includ- ing Netscape founder Marc An- dreessen, former AOL executive Kenneth Lerer and former Goo- gler Joshua Schachter. The start- up is still in stealth mode, so Poole declined to give details.


Digital intuition


How 4chan — a site built for fun by a teenager that barely ekes out a profit from online ads — manages over and over again to outwit the systems that multibil- lion-dollar corporations use to make money on the Internet is one of the great mysteries of the capricious online world. “The community self-organiz- es, decides on goals and achieves them in an ad hoc, undirected manner,” said Schachter, who in- vented the social bookmarking tool called Delicious. “I see it like the financial markets — sort of chaotic. It’s hard to understand, but incredibly vital to under- standing out how people operate together on very, very large scales.”


When 4chan was created in the fall of 2003, it was a narrowly fo- cused “image board” where peo- ple interested in Japanese anime could trade comments and pho- tos. Poole told nearly 20 people about it, and the site has grown by word of mouth ever since. It now has 11 million unique visitors (similar to The Washington Post’s numbers in May) and 730 million page views a month (similar to the New York Times). There are 1 million new posts per day. Its demographic is largely males ages 18 to 25 — “guys with nerdier in- terests,” according to Poole.


‘Antithesis of Facebook’


At a time when more and more of the Internet seems walled off into communities such as Face- book or MySpace, which operate with pages of rules and proper protocol, 4chan is the exception. You don’t need to register to post on the site and you can de- lete your posts at any time with no record. You can curse and in- sult all you want. While there are some thoughtful, wonky conver- sations, many of the posts range from juvenile to risque to just plain gross. Its critics describe 4chan — and


especially Anonymous, a loosely affiliated group that is credited for some of the pranks — as the dark side of the Internet. “Hack- ers on steroids,” “domestic terror- ists” and “Internet hate machine” are among the insults that have been hurled at it online. It has been blocked, albeit temporarily, by both AT&T and Verizon. But fans say 4chan is a haven for free speech. “The Internet needs some of these unstructured spaces. . . . This may be a reaction against other places that have developed that say, ‘This is what you use Facebook for, this is what you use LinkedIn for,’ ” said Wendy Selt- zer, a fellow at Harvard’s Berk- man Center for Internet & Soci- ety. Poole, who goes by the online name “moot,” is now 22 and based in New York. He describes 4chan as the “antithesis of Facebook.” “Facebook is about real-life


identity and having all these con- nections,” he said. “4chan is anonymous and ephemeral.” Poole, who says he neither in-


stigated nor participated in any of the pranks, explains how 4chan users manage to get on Google Trends. They say, “ ‘Let’s seize this idea.’ ” They then spread word through the discussion boards, e- mails, chat services and so on, asking everyone to search for a specific word or words at a cer- tain time. Next, Poole said, outsiders fan the flames. “Bloggers start to see this trending and think there must be a story, and all start to post stories. Higher up the totem pole, the bigger media outlets see rumors, and they’ll comment, ‘Hey look what everyone else is looking at,’ ” he said.


Gaming the trends Search engine expert Barry


Schwartz said the Google Trends list is generated by ranking searches and the number of news blog articles coming out about the Web on a new or unique topic. It’s impossible to put a number on how many people must be in- volved to get a topic at the top, he said, but it’s “a ton.” Why people would decide to spend their time following sug- gestions by 4chan is what’s un- clear in this chain of events. “There’s a lot of energy in the system from people who have nothing to do, no outlet for their goofing off,” Schachter surmised. Seltzer theorized that “when peo- ple see it as a game to beat Google or stack a vote, they may be will- ing to do things that they wouldn’t have been willing to do for pay.” In March, Poole was invited to


speak at Facebook’s headquarters in Palo Alto, Calif. He was asked to talk to a group of engineers about 4chan vs. Facebook — ways they are similar (“there aren’t many,” Poole says) and how they differ. He started out his talk by asking people to raise their hands if they had a negative impression of 4chan. Most everyone did. “Ap- parently,” he recalled, “I was a controversial speaker.” ariana@washpost.com


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Economy & Business


A13


ILLUSTRATION BY ROBERT DOMINGUEZ Social Security, the trust fund and funny money T


here’s real money, then there’s funny money — stuff that looks real but isn’t.


Today, let’s talk about one of the world’s biggest piles of funny money — the $2.54 trillion Social Security trust fund. It matters now because Social Security revealed plans last week to tap the fund for $41 billion this year and will begin tapping it on a regular basis in less than five years. This year’s cash deficit, the


first since the early 1980s and the biggest ever, means the government will have to borrow money to redeem some of the Treasury securities in the trust fund. Even at a time when Uncle Sam is borrowing $1.5 trillion a year to keep his checks from bouncing, $41 billion is real money. Here’s why the trust fund is


funny money. Let’s say I begin taking Social Security when I hit the full retirement age of 66 later this year. Because its tax revenue is below its expenses, Social Security would have to cash in about $3,400 of its trust-fund Treasurys each month to get the money to pay me. The Treasury, in turn, would have to borrow $3,400 from investors to get the money to pay Social Security. The bottom line is that the government has to borrow


DEALS Allan Sloan


money to pay me, regardless of how big the trust fund is. It’s not surprising that Social


Security is now running a negative cash flow — I predicted a year ago that it was likely to happen this year, and wrote in February that it had happened. Democrats, for the most part,


say everything’s fine because the trust fund has a fat balance. Republicans were happy to have Social Security taxes subsidize tax cuts for 25 years, but they have suddenly developed a holier-than-thou fiscal rectitude. They’re both wrong — the Democrats financially, the Republicans morally. Let me show you in two


different ways how useless the fund is. The first is a quote from the introduction to the 2009 Social Security trustees report, the second is the graphic by my Fortune colleague Robert Dominguez that accompanies this article.


Allen Smith, economics professor emeritus at Eastern Illinois University and author of “The Big Lie: How Our Government Hoodwinked the Public, Emptied the S.S. Trust Fund, and caused The Great Economic Collapse,” spotted the 2009 quote, and it is telling. It says: “Neither the


redemption of trust fund bonds, nor interest paid on those bonds, provides any new net income to the Treasury, which must finance redemptions and interest payments through some combination of increased taxation, reductions in other government spending, or additional borrowing from the public.” In other words, the trust fund is of no economic value. This sentence wasn’t in the


2010 introduction, released last week. Treasury says that it stands by the statement but that the Social Security trustees decided not to include it this year because it reiterates the obvious. Now, to the “Geithner bond,” which shows how easy (and useless) it would be for Treasury to stick as many bonds as needed into the trust fund, and then declare Social Security to be sound forever. You know, of course, why this wouldn’t work — at least, I hope


you know. It’s because the U.S. government ultimately has to pay its bills with cash, not with its own IOUs. In the long run, you need cash — real money — not funny money. Other than being a send-up, this hypothetical Geithner trust-fund bond is no different than the Treasury bonds the trust fund owns, except that it carries a higher interest rate. There are ways, even at this


late hour, to begin turning the trust fund from funny money into real money without unduly stressing the government’s finances. (I’ve discussed them before, and will do so again, but not today.) Given that taxpayers are bailing out the most imprudent companies and people in the country, we damn well should bail out Social Security, the mainstay of low- and middle-income people. But let’s not kid ourselves that


a fat trust fund is the solution. When Social Security’s cash deficits begin running more than $100 billion a year within a decade, it’s going to take a lot of money to keep the checks coming. And it sure won’t be funny.


asloan@fortunemail.com


Allan Sloan is Fortune magazine’s senior editor at large.


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Poole, 22, moved to New York and has been courted by industry heavyweights for a new project. 4chan has become known for elaborate mass pranks on the likes of Google and Justin Bieber.


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