Tuesday, September 3, 2013

Funding Freedom The Headless Way

Let's imagine for a moment that the Koch brothers are really awesome libertarian guys who funded institutions for the express purpose of promoting liberty. This isn't too hard to imagine, for they have funded an institution or two. The problem is that these institutions are oriented to D.C. and, well, they haven't really effected very much change. Government hasn't listened to a cogent argument or two and then become suddenly sensible. Instead, if anything, D.C. warps these guys. I'll never forget I was watching some beltway thing about school choice, as if it were a win. It felt like a win, like finally there was progress, but then I realized this was still public school. Still a behemoth, still a local issue made federal, and a basic service that a free market could provide, but that which was being royally screwed up by government. Who was trying to make me feel happy? Some beltway libertarian type. I can't remember if it was Reason or Cato, but I have had my guard up since then. This is not the way to freedom. This is more like some poor student trying to make the best out of public school lunch.

So, clearly, funding any sort of think tank that will get involve in politics is dangerous. The politicos and the lawyers will bend the thing to their will. Indeed, if there is a leadership structure, and it gets popular, bad things can happen, even if it doesn't directly interface with government. There are places for things like corporations- they could be protection for the people. Think about Detroit. Nobody needs that level of incompetence from a city. We need protection from that sort of thing. We also need protection against corporations. It isn't easy for small farmers to deal with Monsanto, for instance. Properly done, these things could help.

But I am thinking about bitcoin. I am thinking that if I had a lot of money, I could go around to various conferences where people likely to know about Bitcoin would gather, and then I could buy bitcoins, essentially off-line. They do have to go to an address, from what I understand, but the main point of the exercise here would be to establish a healthy price floor. There will likely be liquidity problems as long as the on-line exchanges are under threat from governments, but a solid, respectable price could be established via a little cash and some old fashioned leg-work.

What's the point?

I'd be funding a network of people who are largely committed to freedom. Sure, it would be nice if bitcoins paid off in a big way, and, after some time of bolstering the currency up, I was able to reap some profits, but if my chief concern is promoting liberty, well this is promoting liberty directly. This is also testing the government, hopefully proving it to be weak, and bitcoin to be strong. There are very few people who actually think the government would shut down the internet, for we imagine politicians are human just like us and, well, they just wouldn't do that. But they might. I doubt it, but imagine they did. We wouldn't have to talk that much about how our freedoms have been taken away.

But, under most scenarios, internet and bitcoin stick around, with some level of government interference attempted. I suppose this can range a lot. Maybe government action is limited to trying to shut down exchanges. Maybe they send out S.W.A.T. teams to anyone with an I.P. address that has ever been associated with bitcoin. Maybe they just bungle the whole thing.

Meanwhile, something else would be happening. A bunch of people would be working out how to trade based on the increase in wealth my actions had given them. Some of them have cash, others notice their bitcoins have slightly more value today than they did yesterday. This, in the face of all the various scenarios of what the government might or might not do, is what I would really be banking on. This the unseen, the unknown, other than the fact we know these guys tend to be pretty smart. This would be investing in a network- one with no real head, no structure.

I don't know how much money something like this would actually cost. I think there will only ever be 21 million bitcoins, and they can be lost, so I suspect the full 21 million will never be live. Additionally, there are only so many places you can go, and so many real-space transactions one can do, so the price floor might actually be pretty low. I could imagine a scenario under which a person who did this held most of them- likely in many different addresses- and simply didn't sell any. Hopefully the price would come back up.

If you have a lot of money, this is a better bet than what the Koch brothers did. You don't know what bitcoin type people will do with your money, but it would beat the think tanks in style and effectiveness.

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