That’s it, I’m publishing the last chapter of The Mechanics of Freedom, Welcome to the Future, hooray! Here, Friedman discusses what ensures digital privacy and what hinders its widespread adoption, why anonymous altcoins provide less anonymity than bitcoin mixers, and touches upon a topic I raised in Digital Identity — that it doesn’t matter how strong your ciphers are if the observer is omnipresent.
All I have left is to edit and post the appendices. Next, I’ll need to go through the entire text to make final corrections — the translation took over a year, so some stylistic inconsistency is inevitable for now. Then, I’ll need to format the text for e-books as well as for print. After that, I’ll upload all this wealth to the website, send it to Friedman, and offer the print version to both the DPRs and the Tea Club — in short, let it spread as widely as possible, for all our joy.
To make the joy complete, you can throw me an encouraging portion of bitcoins. Oh, right, I mustn’t forget to include an acknowledgments page in the finished book: for those who sent donations, those who translated, and the person who obtained the full version of the text from the author — in short, let no one be left out.
This is my fourth text about Belarus (others can be found via the hashtag #Belarus), and this time it was prompted by watching a conversation between Mikhail Svetov, Roman Popkov, and Elena Borovskaya, as well as Roman’s post summarizing the stream on his channel.
Roman Popkov’s account of the current state of Belarusian civil society was very informative and explained why things are going the way they are, but right now I want to talk about something else.
During the conversation, Roman reproached “Moskals” for their excessively technological mindset. Ponasenkov took the brunt of it with his Die erste Kolonne marschiert, die zweite Kolonne marschiert, but Svetov, who agreed with Ponasenkov, also got hit. I, for one, although I live separated from Moscow by a considerable distance and the Ural range, am still one of those very same “Moskals,” and therefore I also have a purely technological approach to this political science problem: how to ensure the transit from an illegitimate dictatorship to a transitional government, constitutional reform, and a new legitimate government. And I see exactly two options.
Option one. Do you want it to be like in Ukraine?
If the dictator previously had enough strength to weed out combat organizations (hello to Roman Popkov and his NBP) by the root, then now, with constant street protests occurring, it is quite easy to disguise combat coordination training as episodic spontaneous coordination. Tens of thousands of people daily search for the most effective ways to exhaust the opponent’s resources, get to know each other, find out what everyone is capable of, and if the degree of anger continues to rise, then at some point the hundreds of corpses mentioned by Roman will stop seeming like a serious restriction on the path to overthrowing the dictatorship.
Of course, they don’t charge head-on toward administrative buildings, but, as we saw in Ukraine, they seize military warehouses and armories in police stations. After that, a transition to the hot phase of street fighting is inevitable, even if no one is injured during the seizure of weapons. And street fighting will inevitably end with the overthrow of the dictator.
Option two. What is the name of the President of Switzerland?
What follows is a fantasy story; do not take it as a forecast.
Tikhanovskaya arrives for Biden’s inauguration. This is an excellent pretext to discuss exactly how to overthrow Lukashenko. The invasion option is dismissed, and a cheaper one is proposed. Lukashenko is placed on an international wanted list, and a serious reward by Belarusian standards is set for his capture, dead or alive—say, a conventional hundred million dollars. Simultaneously, a second very important person enters the fray; his name is Guy Parmelin. He is the Vice President of the Swiss Confederation, who by the time of Biden’s inauguration will be the new president (hello to Mikhail Svetov and his constant rhetorical question about the name of the President of Switzerland). Switzerland is a neutral country with a very stable political system. Only it can give Lukashenko a guarantee of lifelong political asylum (Russia or the USA cannot).
That’s it; now we start the clock and watch to see what happens first: one of Lukashenko’s guards presents his head and demands the reward—or Lukashenko seeks guarantees from Mr. Parmelin and leaves the country immediately after they are confirmed.
While the Adam Smith Readings were taking place, I was commenting on them via text on Telegram and Facebook, but now the organizers have uploaded the final recordings to their YouTube channel, so those interested can watch specific lectures targetedly rather than watching a continuous recording of the broadcast.
Personally, I found the lectures by Lyudmila Petranovskaya on the ethical aspects of COVID discussions, as well as Evgeny Varshaver’s on the integration of migrants, to be the most interesting. Let me know in the comments what you enjoyed.
Yesterday, I published a post describing my modest user experience installing a single program on Linux. The verdict was that for most people, even if they are libertarians through and through, convenience in the here and now can easily prove more important than abstract ideals. This is true in far more cases than just when choosing between a graphical interface and a console. In the same way, people neglect to carry means of self-defense, don’t set passwords on their phones, and have sex without a condom.
Naturally, the post sparked a lot of debate, because the war between adherents of different approaches to interacting with computers has dragged on since deep antiquity. And, as I understand it, every revival of this eternal bickering always consists of at least two posts: the first condemning Linux, and the second defending it. Today is time for the second.
I installed a version of Linux that was positioned to me as being quite close to Windows in terms of interface. It installed easily and effortlessly. All typical applications, such as office suites, browsers, Telegram, or password managers, are installed without any console via the graphical shell. If my task were to move all my daily work to open-source software, I would move to Linux without any problems and wouldn’t notice much of a difference. Meanwhile, there are many atypical tasks for which I would need the help of someone with deeper system knowledge even under Windows.
The world is full of technically complex devices that no one has the slightest need to study thoroughly. The magic of the division of labor lies in the fact that everyone focuses on what they have a relative advantage in. Every object has its nuances, and some people specialize in them to increase their value. But at the same time, for the average user, it generally makes no difference which system they use to perform most of their tasks; any will do.
So, I will clarify my answer from yesterday to the question of why libertarians don’t use open-source software. Yes, they use what is convenient, but often a large part of that convenience boils down to the network effect. If advertisements for computer technician services mentioned not the setup of Windows and installation of antivirus, but the selection of a Linux distribution and system configuration for the user’s tasks; if information on government resources were stored in odt rather than docx; if hardware Bitcoin wallets were sold in mobile phone stores—that would be clear evidence of the network effect working in favor of open-source software and decentralized money.
What is needed for libertarians to use open-source software? Simply to start using open-source software.
This post was written on Linux, and future ones will be written on it as well. There is no reason to delay adopting useful habits.
Why do libertarians dislike talking about open-source software and its advantages? Shouldn’t a libertarian use only free software (Linux instead of Windows and MacOS, LineageOS instead of Android and iOS) if they respect their own freedom and privacy? Free software helps protect against surveillance by the state and corporations—it allows one to achieve true freedom. Or do most libertarians not respect their own privacy? If it is too difficult to understand all the technical intricacies, why not pay others to create accessible programs and educational materials?
Richard Stallman
Someone recently tried to teach me how to write Telegram bots. For some reason, this meant I had to install Linux. The system was installed without any problems, but then the “dancing with a tambourine” began. Let’s install Python. Open the console, write this specific incantation. Did it work? Come on, send a screenshot. Aha, a correction, write this incantation instead. Now let’s install these libraries. Write this incantation. That’s it, launch PyCharm. Why not from a shortcut on the desktop? Why must even such an elementary action be done from the console? And now in PyCharm, open its internal console and write this incantation there to install the libraries. Wait, we already installed them! It doesn’t matter, they need to be installed locally for each project. And don’t forget to select the interpreter. I’m already in PyCharm; it’s an IDE, why do I need ten interpreters to choose from? What prevents them from making one by default and ten optional ones for the masochists? Who taught you UX?..
I have nothing against open-source software or content. I went to Wikipedia and made edits to the article about David Friedman. Five minutes—and millions of Russian-speaking users get access to up-to-date information. Spontaneous orders are power! But if handmade clothing is expensive and uncomfortable, then only historical reenactors will wear it. If an open-source OS requires far more effort for simple things than a proprietary one, then only geeks obsessed with security will use it.
Whoever steals the Windows source code from Microsoft and posts it in the public domain on some maximally decentralized platform will do humanity a huge favor. Because this system quite deservedly holds its market share—even despite being proprietary and spying on the user. I have written repeatedly that we are already ready to live in conditions of “new sincerity,” where everyone can and has the full moral right to spy on everyone else, so the system’s spying is not perceived as something terrible—as long as it doesn’t steal your money or snitch on you to the Investigative Committee (and people stay on VKontakte even knowing that it snitches on users). There are many examples of software that was proprietary for some time and then was released into the public domain, and thereafter is developed by the community. And obviously, the weaker the state protection granted to IT giants, the more often this will happen.
I had never heard of Lineage OS, so I looked it up, and it turned out that my phone model is not supported. So, when I change my phone, I’ll buy one with this factor in mind (if supported models don’t turn out to be disproportionately expensive), and then we’ll see. I hope it will be more like the Wikipedia experience than the Linux one.
Using open-source software is like being a vegan. If you live in India, it’s no problem; there’s plenty of delicious vegan food everywhere. If you’re in Russia, you pointlessly condemn yourself to a more expensive life of lower quality for the sake of certain ethical principles. The more these principles mean to you, the greater the sacrifices you will make to follow them. Free software is cool, but software that is convenient to use is much cooler for the vast majority. The market has decided.
The key idea in the video is that the balance of violence potential is ensured not only by possibly equal armament—this is unattainable, as players with more resources will easily win an arms race. The factor of solidarity is far more important. The willingness to not allow violence to be used not only against oneself, but also against others—if one can speak of a silver bullet regarding the construction of a non-violent society—then this is the closest candidate.
Of course, the video is not reduced to this single thought; I won’t retell it in full, watch it for yourself. The technical quality of the video continues to grow, but don’t forget to feed the studio with your donations. A critical dependence on one large sponsor strongly disrupts the balance of the potential for independence in decisions, if one may put it that way.
The Telegram channel BITCOIN TRANSLATED has published a translation of Philipp Bagus’s book The Defense of Deflation (as usual, I have moved the text to my own site to avoid broken links). The translator is Sergey Soltys. I haven’t read the book yet; once I do, I will post a review. But I shouldn’t delay your access to the reading just because I haven’t formed an opinion on the text yet. Usually, if libertarians translate something on their own and put it in the public domain, it means they consider the work to be worth it.
In our new world, data has turned into a very profitable commodity traded by states, companies, hackers, and anyone else who feels like it! Could they all possibly give up this resource at once, even if you were to cut the state out by the roots? Moreover, people mostly don’t care about their personal data when visiting websites, downloading games, apps, or TikToks. In other words, it’s a kind of exchange of one’s data for convenience/benefits. I don’t think anyone’s property rights are being violated in this case. What do you think?
P.S. This question occurred to me while I was downloading a certain hyped-up Chinese game (those who know, know what I’m talking about). They wrote it right there: that you agree to let them use your account info for their own purposes. In other words, in simple language understandable to a human, and not like in other apps where everything is blurred and vague, explained as if saying, “we aren’t stealing from you, but we’ll take it somehow, and it’s better if you don’t think about it at all, ciao!”
Anal Magician
I would like to take this question as an opportunity to recommend to the reader an article in a channel with the immodest name without compromises, but with a surprisingly modest number of subscribers. However, the text of the article itself is posted on VKontakte, where the author has an order of magnitude more subscribers. There, a particular take interested me.
If one blindly honors the text of a contract with all its squiggles, reservations, and footnotes in tiny print, then the service provider has an economic incentive to cushion their own fall in the text of the agreement: the consumer will not look into the details, but the text of the agreement will significantly restrict them. However, the details of the agreement that are in plain sight must be made more attractive to the client because of competition.
But if we consider only that which was explicitly stated during the conclusion of the agreement as the contract, and treat all implicit nuances that were not discussed as merely unilateral good wishes—then an economic incentive appears to make contracts short and clear, so that the process of concluding the agreement is not burdensome for the buyer, otherwise they will go to another provider.
As we can see from the example you provided, when there is no need for legal hair-splitting, lawyers quickly switch to human language and state directly what rights they reserve. And, as we see from your reaction, the client tends to approve of such honesty. Meanwhile, it is unlikely that you would be so lenient toward a stated intention in a contract by the game developers, for example, to withdraw money from all your bank accounts or bitcoin wallets that the company manages to access. Even though, it would seem, this is also just a matter of access to data.
We live in an increasingly transparent world, which, moreover, will soon be filled with a large number of fakes indistinguishable from reality. Legal protection of personal data, privacy protection of personal life, private keys and passwords—all these are rearguard actions before full capitulation. What to do after capitulation? I wrote about this in one of my old posts titled Digital Identity.
The future is shaky, but I have a feeling that our generation has already accepted the new rules of the game in advance and isn’t particularly worried about it. As for those who, out of habit, will want to hide something, they are doomed to occasionally find themselves in an embarrassing position. Let’s wish them not to get too nervous over such blunders.
I apologize for not answering the direct question about what color underwear we will wear under ancap, and what style under minarchism. What can be done, if we will be going without underwear.
After a long break, Vladimir Zolotorev has published another chapter of the translation of David Friedman’s book Legal Systems Very Different from Our Own. In total, four chapters have been translated out of order as of today. Today’s is dedicated to the legal system of the Amish, who are beloved by Mikhail Svetov.
From the text, it is evident that these downshifters are sympathetic not only to many Americans, but also to Friedman himself. I wonder if they are currently facing problems because of their support for Trump…
The English original was posted on my website around the end of August. The same fate awaits the translation as it is published on mises.in.ua. Usually, corrections of minor flaws are made to the translation, but overall there is not much difference whether to read it on my site or Vladimir’s.
At first glance, free capitalism, unrestricted by the state, has one fundamental characteristic — the inevitable concentration of all capital in a few hands. This leads to a situation that is no better than “state capitalism” in the USSR (roughly speaking, if 1% owns 99% of the capital now, it is clear that over time 0.1% will own 99.9%, and so on). In other words, the absence of state intervention in the market leads to the emergence of such an omnipotent monopoly capitalist that the state would seem like the lesser evil.
Where can I read, if available, 1) A refutation (preferably empirical) of the thesis on the concentration of capital. 2) What can stop concentration, other than non-economic (read: state) intervention?
The question is accompanied by a donation in the amount of 0.00080000 BTC
Unfortunately, any attempts at empirical confirmation or refutation of the thesis on the inevitable concentration of capital under capitalism run into the distorting influence of the state. One can provide examples of how capital concentrates because large capitalists successfully lobby for their interests, and as a result, regulations are adopted by the state that benefit large businesses and disadvantage small ones. Meanwhile, the market reasons for capital concentration remain behind the scenes. One can demonstrate how state antitrust services hinder the notorious concentration of capital, while the purely market mechanisms that also oppose it remain behind the scenes. Therefore, I would like to focus specifically on the market mechanisms working in one direction or another.
Concentration of Capital
The main market reason for the concentration of capital is the positive effect of scale. A large company can afford to use a greater amount of capital goods that increase labor productivity, which allows it to generate more profit and reinvest it, again, into increasingly capital-intensive factors of production.
It is also worth noting that consumer goods are becoming more complex, and the production of many of them inevitably requires the involvement of significant capital. For example, a small shipyard cannot build a cruise liner, and a small studio cannot film a blockbuster.
Diffusion of Capital
Now let’s look at the reasons that contribute to the decrease in the concentration of capital.
First, besides the positive effect of scale, there is also a negative one. The larger the structure, the more costs are attributed to parasitic processes. Orders move through the chain of command more slowly than they would in its absence. An order in a chain of command is more likely to be distorted than in conditions where an individual entrepreneur sets tasks for themselves or directly for the executors. Employees in large structures are no longer motivated by the company’s profit, which they influence only very indirectly, but by artificial KPIs. As a result, they are more focused on achieving KPIs rather than on the interests of the business. All this reduces margins. At a certain size of the structure, the negative effect of scale becomes stronger than the positive one. A business that has grown beyond its optimal size begins to eat away at its capital, yielding market share to smaller competitors.
Second, it is small businesses that implement the lion’s share of innovations. Even in a large company, pilot production is relatively small in size and relies on a small number of scarce specialists. Sensing excess profit as a result of implementing their idea, such a specialist can quite easily leave the company and open their own startup, which then skims the cream off the market. Successful startups grow, and the share of old capital decreases.
Third, for the sake of reducing risks, a large entrepreneur will prefer not to put all their eggs in one basket and will invest money in several companies. This dilutes the ownership structure of companies; the owner can no longer closely monitor the development of their business, responsibility is shifted to management, and it is the top managers who become the primary beneficiaries of the process, while the relative income of investors falls.
Finally, the factor of capital dilution upon inheritance does not disappear. The larger the company, the greater the chances that a bunch of people, as well as various funds, will be mentioned in the will, whereas a small enterprise is more likely to go to a single heir.
And what does this tell us?
Nothing. The optimal size of a business for each industry, and often for each region, is different and constantly changing; it is determined by the level of technological development, which can contribute both to increasing the returns from centralization (for example, auto repair shops were quickly displaced by auto plants after the introduction of the assembly line) and to increasing the returns from decentralization (for instance, broadband internet sharply increased the number of content producers and decreased the average size of a newsroom).
The concentration of capital in the hands of a few may increase or decrease; in essence, this is not important. What is important is that in a free market, the welfare of the poorest grows even when the welfare of the richest grows even faster. And there are indeed many empirical studies on this topic (although, of course, one must remember here as well that empirics will inevitably be distorted by state intervention). You can read more about this in one of the chapters of David Friedman’s *Machinery of Freedom*, which I am translating, titled “The Rich Get Richer, and the Poor Get Richer”. The desired empirics are also present there.
… when the impoverishment of the working class just doesn’t seem to happen…
