Facebook’s Libra Isn’t a “Cryptocurrency”

In mid-June, Facebook — in cahoots with 28 partners in the financial and tech sectors — announced plans to introduce Libra, a blockchain-based virtual currency.

The world’s governments and central banks reacted quickly with calls for investigation and regulation.  Their concerns are quite understandable, but unfortunately already addressed in Libra’s planned structure.

The problem for governments and central banks:

A new currency with no built-in respect for political borders, and with a preexisting global user base of 2.4 billion Facebook users in nearly every country on Earth, could seriously disrupt the control those institutions exercise over our finances and our lives.

The accommodation Facebook is already making to those concerns:

Libra is envisaged as a “stablecoin,” backed by the currencies and debt instruments of those governments and central banks themselves and administered through a “permissioned” blockchain ledger by equally centralized institutions (Facebook itself, Visa, Mastercard, et al.).

To put it a different way, Libra will not be a true cryptocurrency like Bitcoin or Ether. Neither its creation nor its transactions will be decentralized and distributed, let alone easily made anonymous. A “blockchain” is just a particular kind of ledger for keeping track of transactions. It does not, in and of itself, a cryptocurrency make.

In simple terms, Libra is just a new brand for old products: Digital gift cards and pre-paid debit cards.

The only real difference between Libra and  existing Visa or Mastercard products is that Libra’s value will fluctuate with the “basket” of currencies and bonds it’s backed by, instead of being denominated in one particular (also fluctuating — you experience the fluctuations as changes in the prices of goods) currency like the dollar or the euro.

When it comes to the goal envisaged by cryptocurrency’s creator, the pseudonymous Satoshi Nakamoto — to free money from control and manipulation by  governments and central banks — Libra is a dead end. Instead of being manipulated by one government or central bank, Libra will be manipulated by all of them.

Cryptocurrency is, to get biblical, new wine in old wine skins — it bursts those skins, by design. Libra isn’t new wine. It isn’t even a new wine skin. It’s a blend of the same old wines, in the same old skins, with a fancy new label. And there’s nothing to suggest that the old wine is getting better with age.

Fortunately, these structural defects also mean that Libra isn’t a threat to real cryptocurrency. Accept no substitutes.

Open This Content

Let People Find Their Own Solutions

It amazes me how often people create worse problems while trying to solve problems.

Most problems can be solved; some probably can’t. Don’t give up trying to solve the hard problems, though. You never know if the Elixir of Life is waiting for you to discover just around the next bend.

The best approach is to let people find their own solutions. Most of their ideas will fail; some will be spectacular failures, but as long as no one’s solution is forced on everyone else, people can keep trying different things. The more ideas that get tried, the more problems will be solved.

Often you won’t know if an idea is good until you let people try it for a while. Then, if it turns out badly, the people need to be free to drop it.

Even some of the bad ideas might have the seed of a real solution, just needing a little tweak to work. It’s only when you set a bad idea in stone — or in law — that it becomes hard to reverse.

When you force a one-size-fits-all “solution” on everyone, a bad idea can do lasting damage.

Most proposals for solving anthropogenic global climate change — “global warming” — are like this. Whether the crisis is real or not matters little. Let people try the ideas they believe will help, but don’t let them impose those solutions on anyone. This would limit what others can try and is almost guaranteed to prevent a real, lasting solution from being discovered. If one is needed.

The most tragic examples are when someone causes more of the social problems they imagine their ideas would address. Things like poverty and crime come to mind.

If your anti-poverty program hasn’t resulted in a measurable easing of poverty it’s time to drop it and try something else. Many times, doing nothing would be better than what is being done.

Crime is another topic where this applies. Of course, I’m referring to real crime — violations of life, liberty, and property — not acts that harm no one other than the feelings of politicians.

I believe, from personal experience and observation, that universal voluntary gun possession would prevent most crime. Others believe a total gun ban (exempting government employees) would be the fix. Only one of those doesn’t rely on forcing a rights-violating, one-size-fits-all approach on every individual in society, so only one is ethical.

If your idea isn’t ethical, I’ll pass, no matter how well it works. With this one limit, find your best ideas.

Open This Content

Martial Negligence in Game of Thrones and Beyond

I’ve previously argued that George R.R. Martin’s Song of Ice and Fire is implicitly a great pacifist work.   While rewatching season 2 with my younger son, I re-discovered a scene worthy of a pacifist ovation.  While Talisa, the crucial pacifist character, appears only in the show, the following exchange sheds great light on the role of martial negligence in Martin’s fictional universe.  For context, Robb Stark is the King in the North, Talisa is a battlefield medic, and they’re surrounded by the bodies of maimed and dead soldiers.

Talisa: That boy lost his foot on your orders.

Robb: They killed my father.

Talisa: That boy did?

Robb: The family he fights for.

Talisa: Do you think he’s friends with King Joffrey? He’s a fisherman’s son that grew up near Lannisport. He probably never held a spear before they shoved one in his hands a few months ago.

Robb: I have no hatred for the lad.

Talisa: That should help his foot grow back.

Robb: You’d have us surrender, end all this bloodshed. I understand. The country would be at peace and life would be just under the righteous hand of good King Joffrey.

Talisa: You’re going to kill Joffrey?

Robb: If the gods give me strength.

Talisa: And then what?

Robb: I don’t know. We’ll go back to Winterfell. I have no desire to sit on the Iron Throne.

Talisa: So who will?

Robb: I don’t know.

Talisa: You’re fighting to overthrow a king, and yet you have no plan for what comes after?

Robb: First we have to win the war.

Notice: Rather than argue that war can never be justified, Talisa shows that Robb is unleashing the horrors of war casually.  He has no master plan to bring great good from great evil.  Instead, he has a master plan to do great evil, motivated by vague wishes to do great good.  Proverbially, however, if you fail to plan, you plan to fail.

Is this scene an unfair caricature of the practice of moralized warfare?  Hardly.  U.S. leaders of both parties barely thought about what would happen after the fall of Saddam Hussein in Iraq or Muammar Qaddafi in Libya.  Roosevelt’s view of Stalin was mind-bogglingly naive.  Wilson, a former Princeton professor, wrote his sophomoric 14 Points, then dumped most of them in a failed effort to build a sophomoric “League of Nations.”  This is what a morally serious case for just war sounds like, but don’t expect to hear anything like it for as long as you live.

Why do even well-intentioned leaders so carefully plan for war, and so negligently plan for peace?  Simple: Despite their self-righteousness, they’re drunk with power.  Well-intentioned?  Don’t make me laugh.  Yes, with great power comes great responsibility… which politicians routinely fail to exercise in reality and Westeros alike.

Open This Content

Find Community, Give, Receive, Repeat

Last night at a beer garden here in Atlanta, I got to see what a healthy modern tribe could look like.

I was meeting with dozens of new and old participants, alumni, and team members from Praxis, the startup apprenticeship program that helped launch my career. If it sounds like a staid old business conference, it wasn’t.

The atmosphere most closely resembled a family reunion more than anything. People were snapping photos and perching on picnic tables, and everyone felt free to talk to everyone else. Shared values and mission brought together people of different genders, ethnic backgrounds, places, ages, religions, and more.

Because of all the differences we brought to the gathering, there was this beautiful cycle of exchange at play – particularly between veterans and beginners. I received affirmation and welcome from mentors and role models. They received thanks and praise from me. I gave affirmation and welcome to younger, newer members of the community. They in turn honored me for my experience.

Everyone had a role to play in the cycle of exchange that comes with a healthy community – and everyone walked away with something. Communities like last night’s little ephemeral gathering provide opportunities to work, explore, play, support others, and receive support and encouragement ourselves. For me (and I suppose for many people), it felt good to play our roles well within that.

The giving and receiving of a healthy community (reciprocal respect and affirmation) is just *right*, and last night’s event was a small glimpse of what life can be like inside that flow.

What if that giving and receiving wasn’t an exception?

What if we engaged ourselves meaningfully as members of as many communities as possible? Or as meaningfully as possible in single communities?

Obviously adding value and receiving value from community isn’t something that can be done haphazardly. But given that stable, geographically-fixed tribes aren’t a thing anymore, we are going to have to work harder to replicate the feelings of closeness and reciprocal respect and love that we need.

Fortunately, I’m lucky enough to get community (and especially that reciprocal respect-affirmation cycle) in jiu jitsu classes, at church, at work, in my small group, and with my accountability partners. But even these small pockets of integrated community aren’t enough. I want to go deeper into relationship there, and I want to cultivate more areas where I can find reciprocal respect and affirmation.

I’m not one to harp on how we *need* other people (we do to some extent, just like we need independence). But community – and giving and receiving inside community – is not so hard to find and not so hard to recognize as one of life’s great gifts. Let’s make it the rule, not the exception.

Open This Content

Life on the Tax Farm

We live in a prison—a massive tax farm—masquerading as a country. We produce so that others may consume. We are given the illusion of influence and of choice. We are told that we matter. We are told we can change things.

It’s all a lie, a fallacy, a grand delusion designed to keep the slaves quiet and contented, believing their servitude to be a choice. It wasn’t always this way. It doesn’t have to be this way now. Don’t you see? But no, keep playing Clash of Clans, keep voting. Both are equally helpful. Wave your flags; hell, if you get really angry, march in a protest with a sign… That will show them.

Then go back to work and keep producing.

You matter. Your opinion is important. Just keep producing.

Enjoy the entertainment. Eat your bread. Keep producing.

You are a credit to your [preferred identity group] and you matter. Keep producing.

Do you have a 4K TV yet? You should get one. Keep producing.

Getting older? That’s nice. You should celebrate. Don’t retire, though. Retirement is for quitters. Keep producing.

Those Walmart greeters seem nice, don’t they? Keep producing.

Oh, you’re dead now? So sad. We’ll put a scoop of your ashes in a jar. Your kids will pay $500 for it. They’ll like that. They’ll keep producing.

You matter. They matter. You all matter. Keep producing.

Open This Content

Erich Fromm on “The Authoritarian Character”

While reading a couple of days ago, I ran into a passage that resonated with me and seemed very timely:

Not only the forces that determine one’s own life directly but also those that seem to determine life in general are felt as unchangeable fate. It is fate that there are wars and that one part of mankind has to be ruled by another. It is fate that the amount of suffering can never be less than it always has been. Fate may be rationalized philosophically as “natural law” or as “destiny of man,” religiously as the “will of the Lord,” ethically as “duty”– for the authoritarian character it is always a higher power outside of the individual, toward which the individual can do nothing but submit. The authoritarian character worships the past. What has been, will eternally be. To wish or to work for something that has not yet been before is crime or madness. (Added emphasis is mine) ~  Escape From Freedom, Erich Fromm

That passage is from a part of the book where he is describing how masochism and sadism are embraced by some as a way to avoid the isolation of freedom*. The authoritarian character, as he calls it, is sado-masochistic. It seeks out ways to suffer to distract itself from the scary aspects of freedom, and it likes to make sure others suffer along with it.

I see the above traits of the authoritarian character, especially the parts I emphasized, in almost everyone who is promoting statism. You can see it in FB posts, in YouTube comments, in comments left on this blog. and anywhere a no-compromise libertarian point is made. I’ve come to recognize and expect this tack, yet was surprised to see it– and see it explained so clearly– in a book from 1941.

I don’t agree with Fromm on everything. I think he made good observations but came to an erroneous conclusion.

He was a supporter of toxic authoritarianism when he obviously– from his own observations– should have known better. Why? Maybe he was just genetically inclined that way. Maybe he wasn’t able to rise above his early brainwashing. But who knows?

You can find truth and wisdom in anyone’s words if you look, even if they are wrong about everything else.

I realize I apparently lack the brain software that makes some fear the “isolation” of freedom. Even though I usually feel isolated due to all sorts of other things, I don’t mistake those things for freedom. That’s like blaming your good health for your fear that you might someday get a disease.

*Fromm uses the word “freedom” (inconsistently, but at least part of the time) for the concept I call “liberty” but that doesn’t alter the truth of these words.

Open This Content