Underestimating long-term consequences of cryptoanarchy

[Tim May]

On Friday, May 16, 2003, at 07:58  PM, Declan McCullagh wrote:

> On Fri, May 16, 2003 at 10:55:50AM -0700, Tim May wrote:
>> -- public choice analysis (who benefits?)
>> -- market distortions (markets are ignored)
>> -- rent-seeking (control of resources means continuing rent); 
>> shakedowns, governments banning competition for its monopolies
>> -- central planning (inefficient allocation)
>> -- laws no longer connected to morality, but to rent-seeking (gov't. 
>> running gambling)
>> -- a general inattention to market, as politicians are not spending 
>> their own money (hence bad investments in urban renewal, factory
>> subsidies, highways, railroads, etc.)--their own money is not at risk.
>
> All that is right, of course, and very concise. I guess I'm inefficient
> because I wrote a piece recently that used many more words to say
> the same thing. :) See below. It's on nanotech pork barreling and
> public choice.

Actually, I wasn't very concise. I listed a laundry list of 
loosely-related ideas...somewhere in there is a coherent and concise 
theory.

However, since some of the ideas have won their authors Nobel Prizes in 
Economics, and since they themselves have not distilled the point into 
a single theorem (a la Coase's Theorem, which is also related, but I 
won't get into that here), listing the examples is all that I could do.

The general theme is purpose "the purpose of life." The purpose of any 
lifeform, or at least the outcome after competition and selection, is 
furtherance of life. Whether genotype or phenotype, whether actual 
instance of a lifeform or the DNA.

The purpose of a U.S. politician is to be reelected. Nothing else 
matters. So the politician will say anything he has to say to be 
reelected. And he will spend money that is not his own to be reelected.

Likewise, the purpose of Congress as a generalized lifeform is to 
perpetuate itself, to grow, to become more dominant. It passes laws to 
insulate itself from competition, it spins a web of confusing and 
conflicting laws to ensure its survival.

The purpose of the judicial system is to ensure its role as the 
priesthood, interpreting the confusing and conflicting laws as the 
seers and priests of ancient times interpreted the signs of the gods.

And so, for lifeforms such as the U.N., the Hague, Saddam Hussein and 
his Baath Party, etc.

This is Nietzsche's "Beyond Good and Evil" writ large. Politicians 
mouth words about good and evil and morality and campaign reform and 
protecting the children, but the real reason they act is out of 
self-interest. This is the larger theme behind all of the examples 
Declan says I concisely described.

The key is to place limits on this ability to act as a devouring 
lifeform.

Most libertarians are, I think, aware of this at a deep level. Most 
favor the Cincinnattus approach to government: Cincinnattus (spelling?) 
was the Roman general who wanted to work his farm. Other Romans, in 
Rome, wanted him to lead Rome. He did so, for some amount of time (I 
forget how long), then went back to his farm.

However, most politicians view politics as their life's work...or at 
least the best-paying job they're ever likely to get. A Congressvarmint 
earns something like $130,000 a year, plus numerous fringe benefits 
(cars, staff, fuckable interns, speaking engagements which pay more 
$$$, graft opportunities, junkets to Carribbean islands, and so on). A 
moderate dullard like Gary Condit from Modesto, California can do 
better as Congressman, distributing other people's money to whomever 
will suport his continuing career, than he can as a fertilizer salesman 
in his home town (like that other famous Modesto resident, Scott 
Peterson, accused of killing his wife Lacy).

Hence Washington, D.C. is itself a lifeform, intent on surviving, 
growing, solidifying its power, proliferating, and generally acting as 
invasive weed. Political kudzu. Instead of meeting for a few months out 
of each year, with the politicians otherwise back in their home 
districts, it's of course a year-round affair now, with most of the 
politicians (and their staffs, who are about 20 times as numerous, more 
if departments of the Executive branch are counted) making the 
political capital their primary residence. With many who lose in 
elections remaining in Washington as undersecretaries of something (I 
just noticed Asa Hutchinson, a former Congressman, is now some kind of 
undersecretary at HHS) or as think tank employees...they would rather 
stay on in McLean or Adams-Morgan or Bethesda or Vienna than go back to 
Skedunktity Junction, Tennessee.

I hesitate to call this a "bionomic interpretation," especially as I 
never really bothered to learn what "bionomics" was all about, but it's 
a kind of biological interpretation.

Or, quoting Nietzsche once again, it's a "will to power."

(No accident that N. was the first profound thinker to come after 
Darwin restructured everything people had thought about the world.)

Entities at nearly all levels seek power, seek life, try to suppress 
competition. The challenge is to find ways to limit the grown of 
invasive weed entities like government (of whatever ideological 
form...the Baathists were in many ways no worse than the Republicrats).

Ayn Rand expressed this in terms of disputing altruism, which is the 
flip side of saying that organisms seek power or act in self-interest. 
(She was a Nietzschian, at least originally, but later found something 
to disagree with him about, and in typical Rand fashion, declared him 
to be some kind of corrupt thinker. Hilarious.)

So, Declan, this is a less concise, restatement of the examples.

Again, close to "public choice theory." But also close to natural 
selection. And ultimately, a market system (of sorts, with various 
distortions caused by men with guns).

Where crypto comes in, of the form we call anarchocapitalism or 
cryptoanarchy, is that it short-circuits or bypasses some of the 
centralized control mechanisms. Which is not altogether new, as the 
telephone did this, as decentralized distribution did, and so on. 
(Which is a reason Russia had but one major city that all sought to 
move to, but the U.S. has long had many major cities....most people I 
know have no stinking desire to live in either Washington or NYC or LA.)

But relating crypto and digital money and data havens to political 
ideology is another major topic, so I'll stop here.

However, you mention nanotechnology, which I have had some interest in 
for a couple of decades (via Eric Drexler, Ralph Merkle, Ted Kaehler, 
and the nanotechnology discussion group in Palo Alto in the early 90s), 
so I will make a few comments:

>
> -Declan
>
> ---
>
>    The best case for a government subsidy of R&D is to fund vital
>    research that the private sector would fail to do on its own.
>    Proponents of government nanotech funding argue that, as in other
>    "basic research" areas, corporations have only short-term profit
>    horizons. They say that government must pay for basic research 
> because
>    that's not profitable--only applied research is.

Some of the nanotech advocates have long-argued for a "Moonshot" 
approach, an Apollo Program for nanotech. Gag! We tried to argue with 
them that this was a terrible idea, that Apollo _itself_ was a terrible 
approach to going into space in general.

The chip industry did not need significant amounts of government money.

It is an oft-repeated and bogus claim that chips came from government 
money. While government spent some money buying circa-1960 technology 
for Minuteman missiles, for example, the commercial development was way 
ahead. I could give a dozen more examples. Anyone who was at either 
Fairchild or TI in the 60s or Intel or Mostek or AMD in the 70s could 
trivially dispute the claim that the core developments of those decades 
came from government largesse.


>    This point has some validity, but there are three counter-arguments.
>    First, private sources will pay for basic research. It may not be at
>    the level that all researchers would prefer, but if it can lead to
>    applied research results, the private sector will still do some of 
> it.
>    Second, nanotechnology includes a mix of early-stage research and
>    late-stage research.  Third, by having private funders, you avoid
>    the public choice problems.

Most of the important spending in Silicon Valley was not of research, 
but was of _feeders_. By this I mean the rise of various companies 
supplying feedstocks: silicon wafers of sufficient purity, liquid 
nitrogen (even plumbed under some streets by vendors), photoprojection 
printers, test equipment, pure chemicals, laminar flow hoods, and on 
and on.

It is this _ecology_ of suppliers and customers that gave us the 
striking advances in chip technology (and similar advances in aircraft, 
in biotech, in computers in general, in software, and so on).

By contrast, Apollo gave us a dozen spacecraft, of which half were used.

Nanotech will need the same ecology of suppliers and customers cited 
above. Government cannot provide this.

However, it is in the interest of some "nanotech leaders" that they be 
the ones to disperse the money of others, that they become the dominant 
nanotech lifeform. Whether individuals or committees (some in 
Washington, even), they will seek to perpetuate and expand. (In some 
cases, the "nanotech leaders" will be the Congressmen who try to build 
a career, and later business gig, on shaping nanotech policy. In other 
cases, it will be early pioneers of nanotech who are unhappy with the 
industrial focus of work and wish to get it back it back to the pure 
vision (I decline to name a name here). In other cases, it will just be 
the usual plodders and dullards who see setting nanotech policy as 
their only hope for some measure of job security. We've seen this many 
times before.


(Which is not to say this did not happen during the rise of Silicon 
Valley. In fact, companies and those in them would like to do the same 
thing. There is no doubt that my former employer, Intel, would like to 
be the dominant lifeform for at least as long as the remaining careers 
and retirement living of its employees! I, too, would like to see it 
continue to dominate--at least until I can sell my remaining stock! 
This is not surprising. Altruism is not why companies like Intel or 
Apple or Microsoft exist. However--and this is important!--they lack 
the power to force their customers to continue to buy from them, as 
companies like Packard (the car company, not the monitor company) and 
U.S. Steel and United Airlines found out. Or, in the chip business, as 
Mostek and Monolithic Memories and Rheem Semiconductor found out. This 
is the difference between "markets with coercion" and "markets without 
coercion.")

(There are deep, and unexplored here, connections between the 
initiation of force and distortions of markets. Organisms have long 
used force--claws and teeth and clubs and guns--as a means of competing 
for food or mates, for controlling territory, for collecting rent.  
Much could be said here about the connections with initiation of force, 
Schelling points for rights in uncoerced transactions, the role of 
untraceability (and hence unreachability in the physical world) in some 
of the interesting crypto uses, and anarchocapitalism in general. We 
seek ways to reduce or remove the ability of men with guns to force us 
to give them money or other things of value.)


>    Real-world subsidies rarely, if ever, follow the ideal found in
>    economics textbooks. Instead, government-funded R&D in the real 
> world
>    is subject to the lobbying and rent-seeking that takes place 
> whenever
>    government dangles money.

Yep, this author is making the same list of points I made: 
rent-seeking, public choice theory, dangling money...all part of the 
general will to power principle.

Rest of article not commented on.

I urge Cypherpunks to listen to their (likely) natural inner voices 
telling them government subsidies have rarely worked and have often 
done great harm.

No government funding for nanotech, or digital money, or _anything_.

So, this article is no longer concise. Such is life.


>

--Tim May, Occupied America
"They that give up essential liberty to obtain a little temporary 
safety deserve neither liberty nor safety." -- Benjamin Franklin, 1759.