Sovereignty in the 21st Century with Balaji Srinivasan

Full Episode here

Key Takeaways

  • Today, fiat is the root of all evil because it is not being checked. Forced irredeemability is the real issue.
  • “You can’t address a market failure with a failing state” – Balaji
  • The dollar is what is holding the tattered union of the US together
  • We are entering an era of global monetary competition

Intro

  • Host of the What is Money Show, Robert Breedlove (@Breedlove_22) interviews a man who is living in 2050, Balaji Srinivasan. @Balajis on Twitter to see what he is up to.
  • In this first of 7 episodes, the two discuss Bitcoin, Sovereignty, and how to best structure society.

Sovereignty

  • Sovereignty as a continuum – What can one do without permission from somebody else?
  • Online domains are relatively sovereign. You can write, create, and edit.
  • Sovereignty is constrained by pragmatism. Cooperation entails some sort of sacrifice for the greater good.
  • The language of collective participation for the public is abused in the West.
  • Do people want to come to your jurisdiction or not? Balaji sees multiple solutions. Whenever you centralize, people will want decentralization and vice versa.

Agression vs Non-Agression Principles

  • The Aggression principle defeats the Non-aggression principle. E.g, somebody shoots you in the head and robs you. There’s no code. “Chaotic Evil”
  • A society that practices the aggression principle is Twitter and Woke culture.
  • Dungeons and Dragons alignments: Chaotic evil: E.g., Street gang. No code. Lawful Evil: E.g., Chinese surveillance society. Lawful Good: Eg., Policeman Chaotic Good – Breaks the rules for the common good.
  • The solution to the presence of an aggression principle is having “No Internal First Strike Tribalism”
    • No internal first strike – This group has a hierarchy and dispute resolution mechanism. There’s an internal code. The logic of tribalism is to kill before being killed.

Individual and Collective Incentives

  • The division of labor creates wealth. Competition provides checks and balances.
  • Sales are individualistic in companies. Incentives matter to ensure a collective benefit.
  • The ultimate goal for individuals and the collective would be a flourishing society
  • The more we can increase the cost to benefit ratio of violence or coercion, the more peace becomes an optimal solution. This is the general point of Bitcoin, the US constitution, and English common law.

Transition from The USA to America.

  • The nation comes from natality. There’s not one culture or ethnic group in the US. Not everybody solutes the flag. It’s no longer one nation under God, rather a bunch of competing groups
  • An American would sooner burn a flag than a dollar – Balaji
  • The United States is an “economic union at best” that is held together by the dollar. You can’t address a market failure with a failing state
  • If the US loses its “hyperpower” status, Balajis sees many other countries re-arming.
  • The US would lose its psychological impact on the world due to polarization, inflation, politicians fighting, and other degeneration.
  • Balaji is bullish on areas with pro-crypto regulation within the US such as Wyoming, Colorado, and Miami. Cities and states will issue their own fiat currencies.

Bitcoin, Fiat, and Monetary Competition

  • Fiat provides short-term price stability at the expense of long-term depreciation. Bitcoin is the opposite
  • Balaji’s “Flat Coin” Idea – Maintains prices by putting limited orders on both sides of a good, such as milk, meat, etc. The purchasing power would be maintained by algorithmic options.
    • Bitcoin would be the check to this system by offering a stable inflation policy.
  • Small countries may be incentivized to offer fiat that is programmable, has privacy features, and provides user custody in response to the proposed Orwellian, negative interest rate CBDCs being proposed.
  • We are entering an era of global monetary competition
  • Bitcoin does not have any competition. However, Balaji thinks we need privacy coins, smart contracts, and automated accounting.
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Notes By Paul Keating

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