Episode Summary

“The personal is political” was one of the early rallying cries of the Second Wave feminist movement. Decades later, the universal adoption of the internet has led to a new culture around cryptocurrencies with an ethos that could be summarized via similar phrasing: “The personal financial is political.”

After decades of languishing in rightful obscurity, extreme forms of anti-government libertarianism have seen a massive influx of converts by melding crank views about the Federal Reserve and fiat currency with a desire to get rich quick through buying and selling made-up digital tokens like Bitcoin, Ethereum, even joke ones like Dogecoin.

Most people don’t understand how cryptocurrencies work as a technical matter. But they also don’t understand the politics behind cryptocurrencies either. That’s a serious problem because underneath all the hype is a radical anti-government ideology that seeks not just to overthrow government currency but even democracy itself.

For this discussion, we’re featuring David Golombia, the author of the book, “The Politics of Bitcoin: Software as Right Wing Extremism.” He’s also a professor of English at Virginia Commonwealth University.

The lightly edited video of our conversation is below. The transcript of the edited audio follows. Please note that you must be an active Flux subscriber to access the entirety of this discussion. Thank you so much for your support. Please subscribe today for as little as $3 per month.



MATTHEW SHEFFIELD: Welcome to Theory of Change, David.

DAVID GOLUMBIA: Thanks very much for having me.

SHEFFIELD: All right. Well, as I mentioned in the intro, I think a lot of people know cryptocurrencies exist. They know that Bitcoin exists. They don’t really understand how it works.

So why don’t you, before we get started into more of the discussion here, just give us an overview of when did cryptocurrencies get started, and how do they work?

GOLUMBIA: Sure. Well, the history here is kind of complicated for a lot of different reasons, which we might be able to get into.

One of the most important historical strands for understanding them is the operations of a group of people who we should talk more about variously called the “cypherpunks” or the crypto anarchists, who since the late 1980s had seen a number of digital technologies as being tools with which they could attack what they call the state, but which I prefer to call democracy.

And it’s pretty clear that to them, these two things are identical. What they hate is democracy, and they are doing whatever they can to destabilize democracy. One of the things that these people saw from the very beginning was– in their own view, which is a conspiracy theory type view– that because in their view the state controls money, and we can talk about what that means exactly, but they thought, oh, well, we should have our own form of money that the state won’t be able to control.

And since the early 1990s, these cypherpunks have been trying to develop alternative currencies that would sit outside of the quote unquote state financial system.

What they mean by that is always very unclear, especially as we get into practice. But during the 1990s and early 2000s, they iterated several versions of a currency that could somehow sit outside the regular financial system. And Bitcoin was probably, it was probably the 20 or 25th version they came up with in practice.

Several of the earlier versions were taken down by law enforcement because one of the ideal functions of cryptocurrency is to purchase services and products that are illegal otherwise.

SHEFFIELD: So the idea though of crypto, what the crypto in cryptocurrency, what does that mean?

GOLUMBIA: Well, it’s funny. It comes out of the fact that these cypherpunks, the thing they are obsessed with is encryption. And encryption technology brought– I mean, encryption isn’t even a technology, it’s just a method, it’s the thing that spies use to communicate with each other. It’s any form of obscuring a message using some kind of regular technique that then the person who is supposed to get the message can und decipher, can decipher for themselves, right?

So any kind of code into which something can be encoded and then later can be decoded as a form of encryption, the cypherpunks realized early on that.

Machine encryption, machine enabled encryption could potentially make messages very difficult for somebody to intercept and decode on their own. Because in the real world of encryption, there are three parties. Right? There is the person who writes the message and encodes it, and the person who is supposed to receive the message and has the authorized.

The proper tools for decoding. And then there are the people who are watching in the middle, the third party, who might be able to use a variety of other techniques in order to see the transaction or the message that they aren’t supposed to see. That’s famously what Alan Turing became well known for, is that he developed a computational tool, a bomb, that helped to decode encrypted German messages during World War II.

The cypherpunks are really paranoid, and so one of the things they think is that government is trying to watch everything we do, which is not untrue, taken in on its face. And so they were kind of, and still are, convinced that if they could encrypt every message with very strong encryption, they could prevent government from seeing what they’re doing.

So part of their goal was to have a financial tool that was heavily encrypted, and that couldn’t be viewed by government. Now, the truth is that Bitcoin, we didn’t really get to Bitcoin, but Bitcoin doesn’t really use encryption in that particular way. It does use some of the techniques involved in the kinds of encryption that they use.

One of the places this is most visible is that each user who uses Bitcoin has what is called a wallet. And a wallet is really just a software file. And the software file has an address or a label that you can point at. And if you see one of these addresses or labels, it’s a long string of meaningless characters and alphabetic, numeric, and even special characters, the same kind we use nowadays for strong passwords.

And the technique to come up with those addresses uses some of these encryption techniques. But in fact, As I’m sure right. These libertarian-fueled ideologies are always deeply incoherent. And so Bitcoin, maybe I should just explain a minute, like how Bitcoin itself works. What they thought was this great solution.

SHEFFIELD: So for crypto, it can mean both the idea of encoding messages, but it also can be used in the idea of hiding identity. Sure. And so in this case, that’s probably more what we’re talking about here, is that, so in other words, when you have, when you hold a cryptocurrency, it’s not linked, generally speaking, not linked to your identity. People don’t know who it is that actually they’re transacting with necessarily, unless they find out through some other means.

GOLUMBIA: That’s right. The Bitcoin network is just made up of these wallet addresses which don’t– you can’t actually encode decode them. They don’t mean anything. They’re just arbitrary strings of characters.

SHEFFIELD: They’re random. Yeah.

GOLUMBIA: They’re random. You can however, use other methods to figure out who is using those wallets and then whether or not they are, it becomes actually quite possible to figure out who is translated.


GOLUMBIA: With the Bitcoin network. Which is one of the sort of ironies, because it certainly was the case that they wanted to make a network that was impenetrable to law enforcement and financial oversight. But in fact, they made something that is incredibly easy to view and that in fact, whose entire history, all the transactions on the blockchain are public.

SHEFFIELD: Yeah. So you mentioned blockchain, so let’s discuss that one.

GOLUMBIA: So let’s just talk about blockchain. What the thing that Satoshi Nakamoto, which is a pseudonym that was used by one or more people around 2008 to write a paper about proposing this network that used several different software techniques that people had already understood for a long time.

And what he came up with was the idea that you would distribute a piece of software that anybody could download onto their computer. And when you run this software, what it does is it does two things really. One is that it takes in all the transactions on this network and it puts them on your computer.

And then as new transactions are made on the network, it does some complicated math to validate those transactions. And every computer that downloads the software and runs it is participating in. Essentially the same kind of thing that a bank or a broker or any other financial entity has to do, which is to validate the transactions rather than having one entity or a limited number of entities doing that validation.

In the case of Bitcoin and the blockchain technology that Satoshi came up with the innovative idea is that this is done by everyone. Everyone who chooses to participate in this network is also simultaneously participating in the validation of transactions on this network that is sometimes referred to as a distributed ledger, where a ledger is like the thing that any organization has to use to keep track of its finances and distributed means it’s on lots of different computers. That and that–

SHEFFIELD: Yeah. And just to clarify for people, the ledger meaning all Bitcoin transactions from the beginning of the release.

GOLUMBIA: From the beginning.

SHEFFIELD: Yeah. So the entirety of it all is all out there. And in order to participate in these transaction validations, which they kind of erroneously or misleadingly term “mining,” you have to have a computer now at this point that has to be immensely powerful. And uses this process, uses a huge amount of energy, such that it’s actually becoming a serious problem in many localities who feel they don’t have the electrical power to enable large numbers of computers to participate in it.

GOLUMBIA: Or they may have incentivized power to be provided to people with low incomes. And then the Bitcoin people may come in and try to take advantage of this and buy cheap power that was not intended for rapacious capitalists, but was intended for very poor people. But to go back to something you just said, that is really fascinating is that when the Bitcoin white paper came out, what excited people so much was that everybody could download this software onto their computer.

And in fact, what I didn’t say is that the process of validating the transactions creates the possibility of a Bitcoin being issued to one of the computers that successfully validates the transaction. And that’s how Bitcoin is created by all these computers running. And every once in a while, a Bitcoin gets spit out to one of the ones that does the transactions correctly or successfully.

And at the beginning, anybody could download the software and run it. I ran it for a little while. You could run it on any cheap computer, and not only could you run it, but in the early days, you could get a hundred Bitcoin by running the software on a cheap computer for a few weeks.

Of course it wasn’t worth anything at the time. And it’s also important to say, I don’t think Satoshi Nakamoto thought about how these tokens would be valued in the real world. He just thought of issuing them. I can send out lots of tokens and or people will start to generate these tokens and they’ll accumulate a lot of them and they can use them to buy drugs and other things that are illegal.

But he didn’t really think about the valuation of, again, this is sort of a typical libertarian, there’s a blind spot of something that maybe a non-libertarian would look at and say, wait. And another thing that the– to go to what you were just saying that that someone with a little more like sanity and background might say is, well wait a minute, something built into this blockchain technology, to the Bitcoin blockchain at least, is that it becomes more difficult over time to validate the transactions. Partly because in the early days there weren’t very many transactions, so anyone could download the whole software under their computer.

But over time it’s become enormous. It’s actually become prohibitive to even download the whole thing, let alone to process it. And I, in addition, the blockchain network, the Bitcoin blockchain network makes these transactions more difficult in an automated way. And so in the beginning you had this rhetoric of—and they used the word right, we’re going to democratize finance.

Everybody in the world can participate in this wonderful movement. Everybody can share in some kind of egalitarian way in the creation of this new financial system. Isn’t it wonderful? You know it, but what quickly happened as it happens in all these kind of deregulated, libertarian spaces, of course, is that people with the most money and power swoop in and they buy up all the resources and the.

the fact that you had this algorithmic increase in the difficulty of the Bitcoin transactions meant that it very be, very quickly became impossible for an ordinary person to mine Bitcoin. It became something that only people with a huge amount of power and money could do, and that’s where it sits today.

There are very few entities that actually mine Bitcoin. It’s unprofitable for the most part, unless you have access to very powerful computers. and very cheap power. And so in fact, it’s become a kind of arbitrage against the price of certain kinds of computing processors and the availability of cheap power all over the world.

And you actually have seen the Bitcoin miners move from country to country looking for the cheapest power available, which they kind of convert. And that’s, and they, the server firms are now enormous, right? The move from running it on your desktop computer to needing enormous, huge warehouses full of very fast computers with tons of air conditioning needed so the processors don’t melt.

And the energy waste of that is unbelievable. Yeah. All these things are doing is sitting there validating these transactions in an extremely redundant, repetitive really useless way. Occasionally spitting out a Bitcoin that somebody gets. Yeah.

SHEFFIELD: Well, and the other thing about it, and of course, and we’re talking about Bitcoin here, but of course most of this applies to the other, the huge number of cryptocurrencies that are out there as well.


SHEFFIELD: And so, there are others of them out there, but I think the other key thing from a political standpoint, I guess as a technical matter, I think we’ve covered all the bases there, I think, unless you think there’s another part we need to talk about.

But as a political matter, the original Satoshi Nakamoto paper about Bitcoin, it was an inherently political document. And the reason that, that he, or they said they were creating it, was that they believed that governments destroy value by not having a gold standard based currency.

Now these are viewpoints that are, up until the emergence of cryptocurrency as a somewhat well-known thing, these were viewpoints that were limited to extremist cranks who worshiped Ron Paul, the crazy libertarian guy who ran for president a bunch of times and just got laughed out of his candidacy every time.


SHEFFIELD: And these were controversies that were settled in the 1930s, and that Americans overwhelmingly said, yeah, you know what? We don’t want a gold backed currency because we see that harms us. It creates deflation in many cases.

And the foundational claim of Bitcoin and a lot of other cryptocurrencies is that government backed currencies are manipulated by governments and that they fluctuate too widely in value and that they destroy the assets of people who have it, have their assets in those dollars, or francs, or euros, or whatever. And so therefore, they needed to create a system that was independent of these arbitrary systems.

But of course, the reality is that when you look at commodity based currencies like gold, the price of gold just fluctuates immensely. Absolutely is not stable in any real way. And of course Bitcoin fluctuates significantly in value and so do all others.

GOLUMBIA: Very significantly. Yes. That’s, it is fascinating. Right? And that’s actually what part of what really got me interested in Bitcoin in the first place, is I spent some time working on Wall Street in the FinTech sector before, the financial technology sector, before Bitcoin ever came along.

And one of the things you learn working on Wall Street is that there are a lot of cranks who hang around Wall Street, right? And you learn to distinguish between the kind of cranky thought and the mainstream thought, which, and the mainstream thought of course has many problems, but it doesn’t have quite the same problems that the cranky thought does.

And one of the key words that you see around the cranky stuff is gold, right? Now gold is obviously a valuable and interesting commodity, and it may even have a small place in the diversified portfolios of very wealthy people who want to have their hands in a lot of different buckets.

But if you look in the back of the magazines that, and newspapers that once were published on Wall Street, there were plenty of ads for gold. They were always far in the back of the magazines, right? And they were always, they had this very conspiratorial overtone of like, ‘the stock market is about to crash at any moment. The only safe investment is gold. Put your money in gold. And by the way, I sell gold.’ Right? And so, it was just a lot of apocalyptic conspiracy theories.

SHEFFIELD: And they would say this regardless of the state of the actual market. I mean, they were running this during the nineties bubble. They were claiming even at the beginning of the bubble.

GOLUMBIA: They were running them all the time. They ran them for 20 years. This is one of the ways that, you know that the people I worked with managed to show me that this stuff was conspiracy theory. That they just run these all the time.

Right? It doesn’t matter what’s going on. They have goal to sell, and this is their best method for selling. It is to tell you the world is about to collapse. And these, the, as you mentioned, the 1930s, right? This stuff does go all the way back to the early part of the 20th century. And when the US and other world markets thought about separating themselves from the gold standard because there are problems with the gold standard.

And then we kind of went back on it and then there’s Bretton Woods when we stepped away from it again. And to be very fair, these people don’t even understand what the gold standard is. Right?

They say they do, but their view is that– which is very interesting is that, and it was that way from the beginning too– is that well, what you are actually doing is trading gold, which is limited in supply, and that gold is fixing the amount of money that can circulate.

And that isn’t actually how a gold standard work, right? A gold standard, the key word there is standard, right? The standard in the gold standard is a price relationship between the money in circulation, and however much gold a government happens to have in its reserves. And those standards, those were ratios changed all the time, right?

And it turns out that in fact, your currency was only moderately impacted by whatever the standard was. And the real problem with the standard was less on the national level than the international level because it created this sort of– it was very hard to value international currencies against each other because you had this third quantity out there of how much gold that each one of these banks have in their vaults in one of these central banks in governments. And it just was incredibly complex and not very useful.

SHEFFIELD: The other thing about gold pricing is that it can be very volatile. So if you have–

GOLUMBIA: Absolutely.

SHEFFIELD: Somebody who is flooding the market with gold, they can, they could, and they did, they were able to take down the value of various countries’ currencies because of that requirement.

Or if gold became harder to mine, then you would have inflation. So the stability was never really there. But I mean, the main concern, I think, for a lot of countries besides having to have all this gold for no reason that they didn’t use was the prospect of deflation, right?

Which is the worst type of economic circumstance that you can have at the nation state level. And that was a significant problem during the Great Depression, and ultimately was the main reason why the United States went off the gold standard.

GOLUMBIA: You absolutely do not want deflation.

And to sort of bring this up to the Bitcoin story, the only way that this really figures directly to the Bitcoin story is that. And it’s important to say it isn’t even inherent in the technology itself, it’s just that the way Satoshi Nakamoto built the Bitcoin blockchain, he just arbitrarily said, we can only ever issue 21 million Bitcoin.

And it’s going to get harder and harder to issue them as they, this is that same difficulty thing I was talking about before. As you get closer and closer to 21 million, it’s going to become harder and harder to issue them. And so the story there was the supply of Bitcoin is limited, therefore, Bitcoin is like gold, whose supply is limited.

Therefore, this currency is immune to inflation, which is bonkers, right? And it’s not. It’s bonkers and it is conspiracy theory in the sense that the far right likes to say that inflation is only about printing money. That inflation is about central banks issuing more currency.

Certainly the issuance of currency by central banks can play a role in inflation. It probably played a role in the current bout of inflation that we’re having, but it is not, by any means, the only thing that happens that causes inflation, and it isn’t the definition of inflation, the definition of inflation is a loss of purchasing power, right?

And if you don’t have to dig far into cryptocurrency discourse even today, to see them having flipped this all upside down and say, no, inflation just means how many tokens there are in circulation; so Bitcoin cannot experience inflation because the total number of tokens is eventually going to be limited.

And when you say to these people, well, yeah, but Bitcoin tumbled in price by 50% over a three to four month period, its purchasing power got cut in half.

And they say, that’s not inflation, because the number of tokens didn’t change that much.

And your mind just boggles like they have inhaled so much helium or whatever, that they can no longer even sort of encounter reality.

The only reason we care about inflation is because we care about purchasing power going down, and vice versa with deflation. And of course they say deflation is actually a wonderful thing. And if you try to give them any of the voluminous academic and political work on why deflation is actually not a good thing and why mild inflation probably is a good thing, you’re just completely at a loss.

SHEFFIELD: Yeah. Well, and to that point, as a political matter and we’ve kind of talked about it somewhat already in this episode. And I would, for those who are interested in kind of the political background, check out episode 56 of this program where you can get another sort of historical look at that with Richard Barbrook.

But going into that, the political theory into this, it is an outgrowth of this sort of crank libertarianism, it is emphatically anti empirical. And it’s based on the thought of people like Murray Rothbard and people who really, who actually literally call themselves anarcho-capitalists, that they actually want anarchy. They want to destroy the government. And they don’t actually, they’re not actually able to make coherent arguments or defenses of their belief systems.

And that’s something that really you see with cryptocurrency evangelists, that they don’t actually understand very much about economics. They don’t understand very much about history. And they don’t realize that all of these things which they claim to be true, have been disproven, decades if not centuries ago. But they don’t reason from observation. They reason from principles, first principles.

And the first principle in their mind is this sort of outmoded viewpoint of freedom. It’s what I call Freedom 1.0, which is only the state can be tyranny and only the state can oppress.

Whereas most people operate from Freedom 2.0, which is that oppression can exist from both the private sector and the public sector.

GOLUMBIA: And if you go to that Freedom 1.0 thing, you might argue that the principle could be phrased a different way rather than freedom of the individual. It might also be seen, not rather because it’s compatible with it, but it is maximum power for me, regardless of the cost to anyone else.

That’s all I care about is a amassing as much power as I can get. And screw everyone else, right?

And you see people using phrases like this when they have those, like libertarianism in four words, things that go around on social media at times. And that is certainly what you see in these people. I mean, they and this is part of, we didn’t talk about this a lot that much, but it’s not clear that the people who built Bitcoin really understood what would happen in regard to its price that it would take off and become something people used to get rich.

In fact, if you read the early stuff, it’s not clear at all that they even speculated that this could happen. One or two of them did. But that’s what really made Bitcoin take off, is that it turned out that if you mined some Bitcoin, and you mi you made a hundred Bitcoin and it happened to be worth a thousandth of a penny when you were a thousandth of a dollar.

When you mind it and now it’s worth a dollar, you have just earned a tremendous amount of money and if it goes up to $10, and when you start interacting with these people on social media who believe this cryptocurrency stuff, right? It’s just like, I got power from this. It made me rich. Screw you. That’s— that is the extent of their ability to reason about it.

Right. And like, it’s hard to argue with the fact that it may have temporarily made many of them wealthy. Of course in the beginning. Yeah. Especially in the beginning. I mean, it’s very hard to sell your Bitcoin nowadays. So, and actually turn it into dollars. So, it’s a, maybe this may be a side note that you don’t really need, but it’s, this the word we u you know, that you use on Wall Street to talk about this view of this conspiratorial view of economics is sound money, right?

It’s the view that if you have a limited supply of money, somehow things are going to be real and stable in a way that having this floating currency is not, and this is the thing that all the people even today will talk about is the advantage of Bitcoin. But what is really funny is it’s not true in Bitcoin at all, right?

Because Bitcoin, as soon as you start to have things like loans and futures and options and margin, right? The ability to give somebody some percentage of what you have and then let them trade 10 or a hundred times that yours, you’re doing the same thing that happens in the regular financial markets.

And that is all over Bitcoin. All the big failures that we’ve seen in recent years in recent months, in fact, like FTX and Terra Luna and so forth have involved these incredible loan schemes that, you just, you can’t even believe that people fall for them. Where they say things, they have absolutely safe loan us here.

Bitcoin 100% returns in one year. And if you’re familiar at all with finance, like your BR three alarms are ringing, right? Like no. If somebody promises you a hundred percent safe loans completely safe loans and a hundred percent return, there is something wrong going on, right? And in fact, they use Bitcoin in all the same ways that they critique the financial system for, and even worse, because it is completely unregulated, and nobody knows who is backing these loans and who actually has the money. And you can’t go back and trace these systems.

And so this again, goes to this sort of like, well the problem is that the real financial system has regulations and laws that govern it. And if I say I’m going to loan you some money and I can’t actually deliver the interest rate I promised you, then I might get in trouble.

But if you’re in the world of maximum power and profit for me and screw everyone else, which you have in Bitcoin, it’s great. You can’t actually get it. Yeah. You’re completely screwed.

And it is, I, it’s hard not to feel a little sorry when you read people on social media talking about how they lost not just their life savings, but multiples of their life savings because they ended up borrowing money or they took mortgages on their house, other kinds of crazy things to go and become rich in Bitcoin. And then it all turned to nothing.

SHEFFIELD: Yeah. Well, and I think another persistent parallel with the libertarian ideology here, is that they don’t want their own actions to be regulated, but they want other people’s actions to be regulated.

They want to be able to buy and sell whatever they want to buy and sell, but if somebody commits fraud against them, then that needs to be illegal.

GOLUMBIA: Absolutely.

SHEFFIELD: And you’re seeing that so much with the outrage against Sam Bankman-Fried and other people like him, there are these demands that he be investigated for fraud and regulated, but not anyone else.

GOLUMBIA: And even why isn’t there depositor’s insurance for people who put money in FTX, and you just hang your head, like you just said, banks. I mean, Alex Mashinsky, right? Another one of these guys who used to walk around with this t-shirt that said, banks are not your friend. And then it turned out he was stealing money, all the money that people had given him.

And in fact, at least in the US but also most democracies, your deposit would be insured and the person who runs the bank couldn’t actually walk away with all the money, and you would just be screwed. Right?


GOLUMBIA: That doesn’t happen in real banks.

SHEFFIELD: Yeah. I mean the ignorance obviously is the underlying commonality with this cyber libertarian ideas. But fundamentally, they do not understand that a free market, quote unquote, cannot exist without government intervention, because otherwise, you cannot have contracts, otherwise there is no punishment for fraud. There is no punishment for theft without the government doing it.

And so therefore, the market is the creation of the government. It cannot exist without the government.

GOLUMBIA: It’s completely right. And if you follow some of what the anarcho-capitalist people say, they really have– no market is free because it turns out that when you have a free market, much like what happened with the distribution of the Bitcoin mining nodes, in which very powerful people quickly swooped in and basically took over the whole network.

Well, of course that’s what happens in completely deregulated areas of capitalism. And they will then say, well, the fact that the big players took over means it wasn’t a free market, and you just hang your head in shame, right?

In fact, one of the few things that a government can do in a capitalist country where you do have relatively free markets is create some ground rules that make it, that to some extent, try to make the players be somewhat equal amongst themselves. It doesn’t work very well. I don’t know, we’ve had so few antitrust and anti-competitive actions taken, but at least there is the theory there that it could work, and you can bring an action against them.

And in other countries it’s done better. But there is, on the one hand, as much power to me as possible. And on the other hand, this talk of some kind of egalitarian distribution of power over everyone and these things are, do not actually go together very well.

They really use this language over here of egalitarianism to justify massive concentration of, especially of wealth, but also of political power.

SHEFFIELD: Well, and to that point, one of the foundational thinkers of behind this extremist libertarianism is this guy named Murray Rothbard, who was a really abhorrent person, created a number of libertarian institutions, including the Cato Institute, as co-founder of that. But he also came up with the idea that ‘most people don’t agree with our anti-government views, so what we need to do is make common cause with racists.’

And he actually wrote a memo that said, you know what, David Duke is the prototype of a Republican presidential candidate. That’s who Republicans should be if they want to win.

And that thinking was kind of later adopted by Pat Buchanan, which then was transferred to Donald Trump.

And he even had written at length about how a true free market would have a market for children, slaves. Child slaves. That you could sell your baby once you had given birth to it, that you should be able to do it because that’s freedom. I mean, it’s just really horrible.

And beyond the sort of extremist ideas about policy, he also absolutely hated the government. And one phrase you quote from him in an essay he wrote called The Anatomy of the State, he wrote: ‘We must therefore emphasize that we are not the government, and the government is not us. The government does not in any accurate sense, represent the majority of the people.

And so, these are fundamental attacks on even the shreds of oversight and accountability that do exist in our current systems. And whatever country you’re in, these people want to overthrow that. And there’s no coincidence that the most activist backers and promoters of Bitcoin are also promoters of the idea.

Like this guy [pen-named] Mencius Moldbug, or Peter Thiel, other cryptocurrency advocates, they actively talk about how they want to destroy democracy, because it’s inefficient and they understand that there is a tension between the desire for equality under the law and their desire to get as much money as possible.

GOLUMBIA: Absolutely. And of course many of them quote Rothbard. You see Rothbard all over some of the early crypto writings.

And he’s often referenced even by people today. And part of this is his real hatred for people, I think in general, for minorities, and in that essay, he doesn’t really give arguments for why the democratic sovereignty is a lie. He just asserts that it’s a lie. Right?

And if somebody were to try to give examples of places where, actually I do think we have a certain amount of power in crafting our government, and I do think it’s right that government is by the people, for the people of the people. And you tried to actually do some empirical study of it, he just would reject it because he believes in principle government, whatever in the world that is, it’s just evil, right?

And that is like the heart of conspiracy theory, projecting this nebulous, formless bad ‘other,’ that has so much power over you, which is resonant with all kinds of anti-Semitic conspiracy theories, but which are themselves, they sit on top of this kind of ur-conspiracy theory of the world is actually controlled by these very powerful people who want to hurt you.

And what is so interesting about it is, that kind of resembles the power that a lot of these people want. They want this kind of strong absolutist, feudal like power for themselves. And they really abhor what they see in this kind of Nietzschean mode, right? This kind of weakness of people who support democracy and say, well, actually, I don’t want all that power for myself. I accept the fact that my power, my political power is shared with everybody else that I live with, and I’m only going to get my way some of the time. And that’s good. It’s good that other people should get their way some of the time. That’s how we create a stable society. And like, and in fact, it would be politically and morally bad for me to always get my way.

And we were talking beforehand a little bit about they do use evangelical religion to spread this. If you look at the sort of splinter groups of evangelical Christianity that have been created alongside the Cato Institute and Focus on the Family and the Moral Majority of Jerry Falwell, and so forth, they also, they spread anti-government hate.

And they conjure this vision of this harsh absolutist ruler who isn’t quite Christ. It’s something like God who one must absolutely submit to.

They teach this. There’s a great book by Jeff Sharlet called “The Family” that talks about this. There’s a documentary you can watch about this, and they preach this, what to any ordinary Christian does not sound like Christian religion, right?

It’s all about, there is an absolute authority and one must submit to him. And it is like these people who really help to create a bridge between Christianity and Donald Trump, who obviously does not embody any ordinary Christian values, but he does embody this view of an absolute ruler, to whom one must submit, and who has accrued all kinds of power and wealth to himself.

It is really poisonous. And there is the politics that embodies our politics, that you might argue that it’s a sort of resurgence of a kind of monarchical politics.

It is certainly part of the things that we think we have made some progress in across the world in the development of democracy, and more egalitarian political systems, and the rule of law, and all these things to which even the leader is subject.

And just to go back to what you said, Rothbard doesn’t really have arguments against this.

Another one who is probably, if anything, even worse than Rothbart, is Hans-Herman Hoppe, a German theorist who is often associated with them, also a leading anarcho-capitalist. I mean, it might not be right to call him a Nazi exactly, but he is, if there is a line between him and Nazism, it is so thin as to be indistinguishable. And he also has no arguments.

He just has all these like weird analogies and metaphors, and yet, he will tell you that the state is the worst thing that has ever been created in human history. And you must pursue your own power at the expense of anyone else and everything else in order to achieve freedom.

It’s a noxious doctrine. And it is really, it is a different face of fascism, but it is fascism is exactly where it leads. And the people you mentioned, Moldbug, and the other far right, alt-right theorists who are associated with Silicon Valley, they are all, at the very least, curious about fascism, if not openly embracing of it.

SHEFFIELD: Yeah. Well, and actually we’ll get into that in the next segment here, but that’s going to actually be only for Flux Patreon subscribers. So, please do sign up for that. You can go to to get the full episode here on video, audio and text. So please do support us.

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