Finding Galt’s Gulch

A New World of Opportunity

Galt’s Gulch is a secluded Colorado community in Ayn Rand’s 1957 novel
Atlas Shrugged where heroes of competence and industry go on strike
from society after becoming frustrated by coercion and central planning.
The residents of Galt’s Gulch build a small voluntary society where people
live in peace and are able to fully express their dedication and passion.

In many ways, the trajectory of the modern world parallels Atlas Shrugged
in that society seems to be gradually grinding to a halt due to irrational
central planning and moral failure. While Ayn Rand’s Galt’s Gulch was a
physical place, the real Galt’s Gulch is taking shape on distributed networks
powered by computer protocols (shared rules). The opportunities to build
new governance systems enabled by this technological breakthrough are
mind boggling. Just as the residents of Galt’s Gulch planned to use their
small community as a launching pad to rebuild the world based on principles of freedom and voluntary action; the Governance Revolution, enabled by distributed network technology, will form the foundation for new systems of cooperation where people are empowered and corruption penalized. The seeds of a new and more peaceful world have been planted on distributed networks like Ethereum.

While the transition to a promising, albeit radically different future, will
likely be tumultuous and potentially dangerous, the world will take another
step towards freedom and a more peaceful future. Ways in which distributed networks will positively impact the World are discussed below:

Power & System Changes

Leaderless networks, made possible by distributed networks, empower individuals, while reducing corruption.  They do so by removing the network “king” characteristic endemic to centralized systems.  The Moloch DAO, for example, demonstrates how smart contracts can be used in place of committees or CEOs.  The Moloch DAO is a distributed decentralized fund which allocates grant monies to develop projects on the Ethereum blockchain.  DAO members have three primary rights.  Namely, they can vote on new members, vote on proposals or they can “quit” and take their portion of the DAO’s funds with them.  That’s it. This straightforward structure and the ability of members to quit aligns the incentives of individual members with that of the group.

Centralized systems routinely ignore the desires of those whom they govern (think 2003 Iraq war, 2008 bail-out).  Distributed governance systems, such as the Moloch DAO, empower individuals to make a real difference. When an individual disagrees with the group, s/he can take actions that impact incentives for other network participants.  Effectively utilizing Game Theory to reshape incentives, decentralized networks fundamentally change how systems perform.  Within these new governance models, the preferences of all participants will be more accurately represented.

Sound Money

Replacing central banks with math and computer protocols provides the single greatest systemic change enabled by new governance technology.  Question: Who holds power in the current system?  Answer: S/he who can create money.  Central banks and the banking system generate money enabling them to buy friends and silence opponents.  This Superpower fundamentally shapes the distribution of social, economic and political power in the current system.  

By fixing the total amount of Bitcoin that can ever exist into a computer protocol (21 million) in addition to spreading decision making across a network of participants with skin in the game, the Bitcoin network aligns the interests of all stakeholders.  Sound money systems such as Bitcoin will radically decrease the power of currency creators.

War and Peace

Governments spend massive amounts of money on war and weapons.  Central governments and their ability to coerce tax revenue from the populace made building a profitable war machine possible. The transition from a manufacturing-based economy to an information economy, along with the creation of an “economic freedom zone” on the internet where large portions of wealth and value creation are migrating, will severely limited the government’s ability to fund war and weapons development in the future.  Moving large pools of wealth, currently within the grasp of governments, outside of their reach and into the control of private and free actors, who are disincentivized to spend on war and weapons, will significantly reduce the amount of violence in the world.  In addition, those resources will be redirected towards productive use.

Cultural Change

In the current world of debt and currency creation the goal for individuals, companies and organizations alike, is how to grab their piece of the inflation pie.  Debt enabled vote buying impacts culture, as well, by making an Olympic event out of victimization. Victim groups compete and complain to see who can establish themselves as the king of oppression hill.  The cultural impacts are awful. Adopting a victim mentality results in irrational ideas and behaviors destructive to personal growth and power.

Distributed governance technology strips centralized vote buyers of their funds, thereby promoting a more rational cultural environment.  In a post Governance Revolution world, the victim olympics will play no role.

Summary

For nearly 10,000 years centralized systems and the kings/queens, committees and CEO’s that ran them, use(d) their power to bend society towards the interests of an elite minority.  Replacing centralized system decision makers with computer protocols will produce a Governance Revolution with far reaching implications.  Keep in mind, we currently rely on computer code (over people) for all sorts of things, including directions/GPS, information, calculations, answers to questions, and so on and so forth.

By enabling people to retain more control over their wealth and productivity, individuals (not centralized decision makers) will determine what society should look like.  Individuals will direct society in a truly democratic manner and without massive costs from corruption and war. For instance, people who want to help the poor by method A can support those programs, while those who want to help via method B can do so, as well.  Those who prefer health insurance package A can chose it, while others who prefer package B can elect it.   People will chose based upon results; not empty promises.  Any system that denies individuals these kinds of choices should be described as totalitarian, not a freedom system.

Going forward, decentralized protocol driven systems will gradually strip the funding sources of centralized systems by redirecting cash flows out of reach of sticky-fingered middlemen. Finding ways to participate in the Governance Revolution trend should be a top priority for all forward-looking people.

As a closing thought, incentives matter.  Indeed, they are critical.  People and those in power chase incentives and act accordingly.  If you want systems to perform differently, change the incentives.  Decentralized protocol driven systems alter incentives as they diminish the power of exploiters and empower individuals.

Next Article in series – Navigating the Financial Earthquake

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DISCLAIMER:

The information provided herein and any accompanying materials is for informational purposes only.  The information is of a general nature and does not address the circumstances of any particular individual or entity. You should not construe any such information or other material as legal, tax, investment, financial or other advice.  I am not a financial advisor and you should consult with an attorney or other professional to determine what may be best for your individual needs. 

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