A Book About Contracts, Trust, and Trading Enterprises

I asked ChatGPT to style my longread about the problem of contracts as an Arabic treatise. You can see how it handled it in the following text; I haven’t changed a single letter, for as the Lord said: leave man to his manliness, and leave the neural-slop to the neural networks.

A Treatise on How Men Maintain Justice in Their Affairs When There is No Single Sovereign Over Them

In the name of Allah, the Most Gracious, the Most Merciful.

Praise be to Allah, Who created humans in need of one another and made the exchange of goods the cause of the prosperity of the lands. Peace and blessings be upon His Prophet, who was a merchant before he became a Messenger, and who said:

“The honest and trustworthy merchant will be on the Day of Resurrection with the prophets, the truthful, and the martyrs.”

Know then, O seeker of knowledge, that there exist societies where people primarily acquire what they desire through exchange, rather than through gift or violence. In such societies, well-being depends on trade, crafts, and mutual agreements. However, therein arises a particular difficulty: no one can guarantee in advance that every transaction will prove honest.

This is especially noticeable when one person fulfills their part of the agreement today, while another promises to fulfill theirs only after months or years.

Therefore, wise men since antiquity have resorted to written contracts.

The Almighty said in the Surah “Al-Baqarah”:

“O you who have believed! If you contract a debt for a specified term, write it down.”

Note that the Almighty does not command the recording of the purchase of an apple at the bazaar or a cup of sherbet in a teahouse. For such transactions are completed before a dispute can even arise. One hands over the goods, the other the money, and both depart satisfied.

But it is otherwise with agreements whose consequences stretch across time.

When a master hires a worker, he buys not labor already performed, but a promise of labor. When a craftsman accepts an order, he sells not a finished product, but a promise to manufacture it. When a merchant equips a caravan, he buys not goods, but the hope of future profit.

Therefore, the parties are forced to describe their expectations in detail.

Who provides the tools?

Who is responsible for damages?

How to distinguish diligence from negligence?

Which circumstances should be considered excusable?

Without such clarifications, each will later remember only that part of the conversation which is advantageous to them.

However, another difficulty arises here.

For human life is not like the drawings of a geometer.

Aristotle said that matters of practical wisdom do not possess the precision of mathematical objects. And indeed: if a triangle remains a triangle today and tomorrow, people are constantly changing.

A servant may become the friend of the master.

A student may become the companion of the teacher.

A companion may become a rival.

And a man hired to sweep the floor may turn out to be a skilled cook or a skilled thief.

Therefore, every contract is inevitably drawn up by people who know the future worse than it seems to them.

If the relationship ceases to benefit one of the parties, it can usually be terminated with moderate losses. The worker leaves the master, the master releases the worker, and the remaining disagreements are most often not so great as to destroy the lives of both parties for their sake.

But the most difficult case arises when it concerns the investment of capital.

For here the desires of the parties are inherently different.

He who gives the money would like to see it again someday, and with profit.

He who receives the money would be most pleased by a situation in which the money remains with him forever.

Therefore, commercial enterprises need a force that compels people to keep their promises.

However, here too, excess is as harmful as deficiency.

If coercion is too weak, no one will trust their funds to other people.

If coercion is too strong, then every unlucky entrepreneur risks becoming a slave to their creditors.

For the success of an enterprise is never guaranteed.

A ship may sink.

A caravan may be plundered.

A workshop may burn down.

And thus, not every loss is a consequence of deception.

Consequently, the prosperity of a state depends not on maximum severity nor on maximum leniency, but on the correct proportion between them.

In this matter, wisdom resembles what Aristotle called the mean between extremes.

For there exist two diseases of trade.

The first disease consists in that no one owes anyone anything.

In such a society, merchants quickly cease to trust one another, craftsmen work sloppily, and the borrower perceives other people’s money as a gift of fate.

The second disease is the opposite.

In such a society, every debtor lives under the threat of ruin, every worker chooses only between various forms of dependence, and those in power use their might to destroy competitors.

Both diseases are ruinous.

Therefore, reasonable people treat contracts with respect, but do not turn them into an object of worship.

For the contract exists for the benefit of people, and not people for the contract.

If every letter of the scroll becomes more important than common sense, then the contract gradually transforms from an instrument of cooperation into an instrument of domination.

For this reason, all trade rests on the presumption of good faith.

People must proceed from the assumption that their partner wishes to obtain benefit not through the destruction of the deal, but through its successful completion.

A good contract is beneficial to both parties.

If benefit is obtained by only one party, then we have before us not a contract, but a kind of command.

However, hope for good faith alone is not enough.

One must understand which forces make good faith profitable.

In all times, such a task was solved by communities.

A merchant did not travel simply as an individual.

Behind him stood his city.

His kin.

His guild.

His faith.

If the merchants of some city acquired a reputation as fraudsters, the next caravan from that city was met without former hospitality.

If anyone offended such merchants without cause, he risked bringing upon himself the enmity of the entire community.

Therefore, reputation became a kind of wealth.

Ibn Khaldun wrote that people achieve great goals only thanks to asabiyyah — mutual support and solidarity.

The same is true for trade.

However, here too, excess brings harm.

When belonging to a corporation becomes more important than a person’s abilities, the market loses flexibility.

Then monopoly takes the place of trust.

Privilege takes the place of reputation.

And coercion takes the place of cooperation.

Therefore, over time, other ways of ensuring trust emerged.

One of them was insurance.

In such a scheme, a third party appears, who receives payment for the readiness to cover losses from unforeseen circumstances.

But precisely because the insurer does not wish to pay extra, he carefully examines the behavior of the participants of the deal.

Thus, insurance not only distributes risks, but also encourages transparency.

However, it too is not a miracle.

Insurance protects well against misfortune, but protects poorly against evil intent.

If fraud proves more profitable than honest work, no insurance fund can exist for long.

Therefore, merchants also devised pledges and escrow accounts.

In some cases, the money remains with an intermediary until the obligations are fulfilled.

In other cases, the parties risk a pre-deposited security.

But these means too have limits.

They work well where the subject of the transaction already exists.

They work worse where the subject of the transaction is yet to be created.

Precisely for this reason, the most risky type of trade remains the investment of capital in new enterprises.

As the market develops, a greater number of interactions become customary.

Rules appear for them.

Standards.

Intermediaries.

Insurers.

Arbitrators.

Experience.

The world of trade gradually becomes like a beautiful garden, where the paths are paved with stone, dangerous places are fenced off, and a signpost stands at every intersection.

It is comfortable to live in such a garden.

But it is difficult to get rich.

For high profit arises where there are no paths yet.

Therefore, the largest fortunes are created not in the garden, but beyond its fence.

There, where merchants set out for unknown lands.

There, where seafarers seek new routes.

There, where people invest money not in an existing business, but in the mere possibility of its appearance.

Just as Sinbad the Sailor once obtained diamonds from a valley to which no safe path led, a prudent investor seeks opportunities where others see only danger.

Yes, dreamers, adventurers, and fraudsters will always gather around such enterprises.

But beside them, people capable of distinguishing fruitless madness from fruitful madness will also appear.

And it is they who will become the pioneers of new markets.

Others will come later, when the risk diminishes and the profit becomes more modest.

And therefore it should be concluded:

Contracts are necessary.

Reputation is necessary.

Surety is necessary.

Insurance is useful.

But none of these instruments is capable of completely ridging a person of risk.

For risk is the price people pay for the opportunity to discover something new.

And thus, the greatest riches are born not where there is no danger at all, but where people know how to face it with open eyes.

The Problem of Contracts

In the comments of Bitarch and Voluntarist’s post, a discussion flared up regarding contracts and their binding nature. Opinions ranged from the view that a contract is sacred to the view that a contract itself is not worth the paper it is written on, and that only the good will of the contracting parties matters. All this was accompanied by questions about how an ancap society is even supposed to be built if contracts are not observed there. I will try to outline my approach to the problem.

Ancap is a free market plus the decentralization of law. That is, on one hand, it presupposes developed exchange relations—gifting and coercion are not completely excluded, but they certainly do not dominate. On the other hand, there is no top-down guarantee that the exchange will prove to be fair. Especially in situations of deferred exchange, when one party to the deal provides real value right now, while the other promises some presumed value later.

Within the framework of this text, I will understand a contract as the accompaniment of an exchange transaction by certain non-obvious conditions. These are precisely what must be fixed in explicit form, because otherwise, it will inevitably turn out that the parties understood each other differently. There is no particular sense in composing a detailed text describing a transaction for buying vegetables at a market. Often, people don’t even ask for the price: a person simply scoops up the goods, shows them to the seller, the seller names some amount within reasonable limits, the person pays and leaves; everything works on defaults—so much so that one can even not know the language and simply show numbers on a calculator.

It is a different matter if it is assumed that the transaction should take place only if both parties agree to some deferred interaction. For example, there is an employment contract. One party promises productive labor, the other promises payment for that labor. But beyond this, a desire arises to ensure that the parties agree on which party provides the space, tools, and materials; what labor is considered productive and, accordingly, subject to payment, and what labor, conversely, is sabotage and subject to a fine; to what extent the employee is responsible for damage to the employer, and to what extent the employer for damage to the employee, and so on. Fixing this agreement in an explicit form allows, firstly, the parties themselves not to forget after some time what agreement was reached, and secondly, to appeal to this agreement in the event that any of the parties decides to involve third parties to secure their interests.

I need a diligent worker to build a palace…

There is an obvious problem here. Long-term relationships are inevitably accompanied by changes, sometimes quite radical. These changes may be impossible to predict in advance, or their possibility may have seemed too irrelevant at the start to be described. You hire a worker—and after some time you find that they are now a business partner or even a spouse. Or, conversely, that they are a competitor who secured the start of their own business using your client base. Or less radically: you hire a person for cleaning, and it turns out they also cook well. Or they clean the premises so thoroughly that they simultaneously “clean up” some valuables stored therein.

But employment is only half the battle. After all, if the relationship has changed significantly but both parties are interested in continuing it, the new relationship can be formalized through changes in the contract. And if one of the parties is interested in breaking off the relationship, they can simply leave the job or, accordingly, show the worker the door. In this case, the parties may have unresolved claims, but if the breakup is not delayed, the volume of claims will be small, and it will then be easier to write them off than to insist on a final settlement.

It is worse if we are talking about investments. There, a unilateral breach of relationship is precisely what the investor wants to avoid from the very beginning, whereas the recipient of investments is initially interested in exactly this scenario: just give me your money and leave forever. In order for investments to exist as a noticeable phenomenon despite such a powerful asymmetry in incentives, a systemic factor of coercion of the investment recipients is needed, so that they strive to fulfill the original agreements rather than presenting the investor with a fait accompli: the money is spent, there is no return, maybe something will be returned someday, inshallah. At the same time, when this factor works too harshly, the entrepreneur bears additional risks: the success of a business is never guaranteed, even if the entrepreneur did everything in accordance with the original business plan for which the investments were obtained. He may indeed find himself in a situation where the investments are spent, success is not achieved, there is nothing to return, and then the notorious coercion factor begins its violent actions to collect the debt. The cheaper coercion is for the investor, the more readily he will invest in dubious projects, and the harsher the conditions under which he provides investments will be.

The investment climate is precisely formed by the perception of such subtleties: how likely is the sudden intervention of third parties and natural forces into the bilateral relations fixed by the contract; how conscientious are entrepreneurs in following agreed-upon plans, or are they more inclined to collect money for one thing and spend it on another; but also conversely, how likely is it that the goal of providing investments is not the creation and development of a business, but the enslavement of the entrepreneur and turning him into a serf.

In other words, both extremes harm the economic prosperity of society. The conditionally left extreme is bad, where it is impossible to motivate a worker, and any somewhat complex project is simply not implemented because everyone has scattered to their own affairs and steals every single nail from work. And if you are foolish enough to lend money, you had better say goodbye to your money immediately; it will be spent on all sorts of good things, but by the very design of society, you are entitled to no benefit from this. But the conditionally right extreme is also bad, where a worker has a choice between several types of indentured contracts and starving to death, and if someone wishes to work for themselves using borrowed funds, the payment schedule will put them in conditions as difficult as those of a hired worker, only with the hourly prospect of falling into debt slavery. If someone starts a business using their own honestly saved funds, the person who has the resources to coerce their workers and debtors into order feels an irresistible temptation to use those resources to put spokes in the wheels of an independent competitor, even if this would be considered an unlawful act.

Ifrits or djinn? Marx or Pinochet?

Applying this to the topic of contracts, it means that, on one hand, contracts, being evidence of the existence of complex and structured declarations of the parties, are absolutely necessary in a society with a developed market and, generally speaking, should be respected. But, on the other hand, the desire to observe any contract to the last letter at any cost, as well as the desire to describe all conceivable conditions of interaction between the parties in contracts with incomprehensible precision, is counterproductive and leads to the loss of that very respect for contracts, since they begin to be perceived more as a tool of violence by the party who drafted the contract over the party who was given a ready-made text to sign.

The most important thing in contractual relations is the presumption of good faith of the participants. Both the parties to the contract and public opinion must be confident that a contract is, firstly, a privilege of equals (a document describing unequal relations is called a “statute”), secondly, stems from the parties’ desire for their own benefit, and thirdly, a good contract is beneficial to both parties. It is this presumption of good faith that makes one party seriously and benevolently consider the other party’s statement that the previous terms of the contract are no longer beneficial to them and therefore it is desirable to revise them, or if this is impossible, to carefully terminate the contract.

But good faith is not inherent in everyone and not under all conditions. In order for the presumption of good faith to justify itself, rather than prompting one to enter into contracts with fraudsters over and over again, one must understand that powerful incentives work toward this very good faith. It remains to understand what these incentives could be in a world with a developed market and an absence of centralized coercion.

Historically, such incentives were provided almost exclusively by the counterparty’s membership in a particular community that bore a share of responsibility for its member and was therefore forced to independently ensure their good faith in relations with the outside world. If merchants from a certain polis cheated while trading, subsequent merchants from that polis might be robbed or denied entry to the harbor. And if merchants from a certain polis were robbed without reason, a punitive expedition might sail in their stead. Or no one might sail at all, because your polis had acquired a bad reputation among traders. If you hire a stonemason from the guild of free masons, he will work so as not to bring shame upon his corporation. If Swiss mercenaries flee the battlefield, who will be interested in hiring Swiss mercenaries?

However, relying only on such insurance groups also entails costs. At some point, for example, it may turn out that you have the right to hire only a union member, otherwise both you and your worker are guaranteed problems. And now membership in a professional community becomes not a sign of quality, but simply an imposed inevitability. Tying a person to a corporation deprives the market of flexibility, forces the loss of profitable opportunities, slows down progress and, ultimately, harms general prosperity, not to mention that it provokes conflicts out of nowhere—that is, when outsiders poke into things that are seemingly not their business, claiming that they have an interest in this matter.

But if a person does not belong to a group that bears responsibility for them, how can their good faith be guaranteed through purely market incentives? In many cases, insurance can help. A third party is brought into the transaction, who receives an insurance premium and in exchange undertakes to guarantee compensation for damages from unforeseen circumstances that arose despite the good faith execution of contractual obligations by the parties. This party is interested in paying nothing for the insurance event and will therefore try to prove the bad faith of one party or another. This means that the parties become interested in drafting the contract and conducting business as transparently as possible so as not to be left holding the bag when it comes to the prospect of insurance payments.

Will such a scheme help us? Alas, only partially. It does not protect against conscious fraud if the profit from it exceeds the amount of the insurance premium. The fraudster has left with the money, and the insurance company shrugs and says that there is clear bad faith of the counterparty, which they did not insure against and do not intend to insure, because today you pay for the loss from a fraudster’s actions, and tomorrow half of all deals will become fraudulent.

To provide guarantees in trade and employment, escrow account mechanisms and various collateral schemes help quite well. In the case of escrow, the participants of the deal lose the ability to receive payment until they prove the fact of execution of contractual obligations to a third party. In the case of collateral, the loss of one participant of the deal from the actions of another is compensated by the value of the collateral. But this does not help protect the investor at all, because in investments for creating a business from scratch, it is specifically the investor who puts in the money, and the entrepreneur only gives a promise to direct this money toward creating a business that should bring profit.

Is this vulnerability so critical? One must look at the context. The market develops a habit of typical actions because they save transaction costs. In a developed market, competition leads to a decrease in insurance commissions, so insuring risks becomes not particularly expensive, and this is done almost everywhere. The world of typical market interactions turns into a cozy park with paved paths, detailed infographics, and fences in all dangerous places. Sweet, cozy, beautiful, and zero drive. In other words, the profitability of business decreases. A good haul can only be made by opening a new market. And only here do we enter the space of unprotected investments.

Venture investing, based on a bare business idea, is a conscious risk for the chance of a big win. Yes, this sphere will attract strange people: project-pushers, “info-gypsies,” simple fraudsters. But from the investors’ side, those who are ready to deal with such a crowd will enter this sphere—those who can sift through insane projects to find those whose insanity looks noble, reinforce inventor-maniacs with clever managers and technical specialists—in short, the market will reward those who set sail not in a washbasin, but at least in a caravel. And then legends will be composed about them, and someone will also earn money on the reproduction of these legends.

No more drinks for Sinbad!

“Sign here and forget that we are assholes”: how NDAs kill the truth about employers

You have probably heard the following more than once: “The market will settle everything.” If an employer is a tyrant, pays peanuts, and forces you to work weekends for a “thank you,” then the invisible hand of the market should simply slap them. People will leave, new ones won’t come, and the company will either fix itself or go bankrupt.

It sounds beautiful. However, for the market to work, it needs information. If you are buying a car, you want to know if it has been in an accident. If you are selling your labor, you want to know if the buyer is a cold-hearted psychopath who will cheat you out of your bonus. And this is where the stationary bandit (the state) steps in with its club, helping corporations break the feedback mechanism.

Very often, employees are forced to sign NDAs. Non-disparagement clauses are particularly noteworthy. This is legal newspeak that translates as: “We will pay you below market rate, scream profanities at meetings, and force you to overwork, but if you write about it on social media or leave a review on Glassdoor/Habr Career, we will sue you into poverty, and our puppet state court will help us do it.”

Why does this break the market? In economics, there is a term “the market for lemons” from economist George Akerlof. If a buyer cannot distinguish a good car from junk, sellers of junk drive out honest sellers. The same happens with jobs. A bad company pays lawyers to draft draconian contracts. The employee is told: “Sign this stating you have no claims and agree not to speak ill of us, otherwise you won’t get a severance package or a recommendation.”

A person cornered by a mortgage and children signs and stays silent. Meanwhile, a new applicant doesn’t know that the company is a living hell. The market signal is distorted. A toxic business continues to exist because the stationary bandit provides it with the muscle to enforce an unconscionable contract. Instead of an honest reputation, which should be the primary currency in a libertarian society, we get a sterile space where all companies are “white and fluffy” until you get inside.

The funniest part is that sometimes state courts still cannot withstand this absurdity. Yes, the state is a machine of violence, but even this machine’s fuses sometimes blow from the sheer audacity of corporations. Here are a few examples where the right to tell the truth defeated a corporation’s right to silence:

1) The McLaren Macomb and NLRB case (USA, 2023). The National Labor Relations Board (NLRB) in the States ruled that the very offer to an employee to sign a non-disclosure and non-disparagement agreement upon termination is illegal. The logic is simple: it violates employees’ rights to organize and discuss working conditions. Moreover, people cannot be forced to choose between a severance package and freedom of speech.

2) The Glassdoor case. Courts have repeatedly sided with review platforms when companies demanded the IP addresses of authors of negative reviews. They recognized that an employee’s opinion about a “toxic atmosphere” is simply an evaluative judgment protected by the First Amendment (in the USA), not defamation.

3) Russian practice (yes, it happens even here). Even in our latitudes, courts recognize clauses in employment contracts that prohibit employees from working for competitors or disclosing their salary as void. The right to free expression and the dissemination of information still works in some areas, no matter how much an HR director might wish otherwise.

What should a normal person do? Read what you sign (you can use AI models to look for “hidden pitfalls”). If you see a Non-disparagement clause without clear time limits and definitions, it’s a red flag. Remember the “Streisand Effect.” If a company sues a former employee over a review stating that it’s a bad place to work, that is the best advertisement that it is indeed a bad place to work. Furthermore, don’t forget that we live in the era of crypto-anarchism and Tor. Nothing currently prevents you from fulfilling your moral duty and telling everyone about a toxic employer anonymously, without consequences for yourself.

Voluntarist, Bitarch

Contracts, restitution, and pocket courts

The Austrian School denies objective value—value is determined by the subjective assessment of the parties at the moment of the transaction. However, Rothbard’s theory of restitution requires that a penalty correspond to the “actually transferred asset.” If value is subjective, then a corporation’s private court is entitled to recognize a $10 million fine for resigning from a post as a legitimate “transferred title”—and qualify the employee’s departure as fraud, opening the way to forced restitution through labor.

Who determines the proportionality of a penalty clause in a contract, and on what basis, if objective value does not exist and the interpretation is carried out by a court hired by one of the parties?

Konweni

As stated in the wording of the question, value is determined by the subjective assessment of the parties at the moment of the transaction. Accordingly, if a penalty amount is specified in the contract in case of its termination, it means that at the time of signing, the value of concluding the contract was higher for the potential payer of the penalty than the amount of the penalty itself. And if the penalty specified in the contract seems absurdly high to an outside observer, this tells us that it was absolutely imperative for the party in question to conclude this agreement at that moment. Another explanation is that the party signing the contract did not read the penalty clause or rashly assumed that it was some kind of nonsense that no one would take seriously, the key points were discussed verbally, and everything else is just empty legal blah-blah-blah.

However, since the question specifically refers to Rothbard’s opinion, he does not make the qualification about the actually transferred title of ownership for nothing. If an employee had been paid an advance and then left the job without working it off, then the penalty is justified, and its size can be calculated precisely from the amount of the advance (for example, the unpaid amount plus the costs of an urgent search for a replacement employee). But if the labor has not yet been paid for, then the asset has not been transferred, which means that penalty sanctions are inappropriate. This is simply a matter of a broken promise. The employer can try to demonstrate to the court what costs he incurred as a result of the employee’s actions, and the court may well take these calculations into account.

Of course, the contract may contain a clause stating that all disputes are settled in a certain court, which is a pocket court of the employer, unknown to the hired employee at the time of signing. The problem, however, is that the court itself does not engage in the enforcement of its decisions, and in the absence of a state, the plaintiff will have to do this themselves at their own expense (and they will also have to put the court entirely on their payroll, as clients are unlikely to flock there on their own). Of course, through his pocket court, he can impose a crazy penalty on the employee who fled from him, and then send thugs to force him to work it off, provided that the employee does not have such funds. But the economics of such actions only begin to add up in colonial conditions, that is, in the presence of overwhelming military superiority of a cohesive group of colonizers over a fragmented mass of natives. Directly in a free society, being a part of it, it will not be possible to pull off such tricks systematically; the non-legal nature of such an organization of work would be far too obvious. Even if this does not lead to unexpected sanctions from actual or potential counterparties, the employer will have to organize forced labor in a society with free labor, where no one will help him, for example, catch runaway workers. You need it, you catch them. And new workers will likely go and be hired by a competitor.

And now I will answer the asked question directly. Who will assess the proportionality of the penalty and on what basis? The employee will assess it, based on their own subjective considerations. If they pay voluntarily, then it is tolerable. If not, see the paragraph above.

— Hm, maybe I should sign? But that portrait on the wall is far too suspicious…

Shame as a Weapon: What Libertarians Should Learn from Progressives?

There is one technique that progressive activists have mastered to virtuosity—the imposition of collective guilt. Look at modern Britons: half the country walks with their heads bowed because their great-great-grandfather once drank tea in Bombay. The result? A non-white migrant there today is almost a sacred cow. Deporting them is harder than convincing a cat to take a bath. The police shyly look away from “cultural peculiarities.” Courts acquit migrants in cases where a native Briton would have long since been sent behind bars. Meanwhile, for some white engineer from Poland, obtaining a visa is a bureaucratic hell of blood and sweat.

Whether you like it or not—the method works! Shame is a nuclear weapon in the information war. And while libertarians are writing another clever post about the Austrian School and the Laffer curve, our opponents have long since rewritten the moral code of society. So it’s time to take the tool in hand, not to lie, but to finally call things by their real names. Let’s look at a few examples of what statisticians can be shamed for.

Shame : It is YOUR fault that grandma is working until she’s 70.

Heard that the retirement age was raised? Crowds of migrants brought in? The demographic pit has turned into a demographic canyon? Congratulations, statist—this is your doing!

Any zoo worker will tell you: animals do not breed in captivity. Stress, a cramped cage, the inability to lead a natural way of life. Now look at your country—the very one where you demanded to “restore order,” “ban this,” “regulate that,” and “there should be a fine for this one.” Where every sneeze is a potential “victimless crime.” Where a person wakes up and the first thing they think about is whether they messed up yesterday according to point 87 of some regulation.

You built a zoo. And now you’re surprised that the population isn’t recovering. But now your pension will be paid by Abdullah, who had to be brought in because the locals stopped giving birth. Enjoy it, because you deserved this—in the most literal sense.

Shame : Your “good law” is someone else’s pain.

Do you know what you and a guy with a bat demanding money from a neighbor for a “good cause” have in common? The method. When you write a petition to “ban X,” lobby to “oblige everyone to Y,” or vote to “introduce liability for Z”—you are not participating in democracy. You are hiring a stationary bandit to go and beat up those who want to live differently.

“But I didn’t do it myself, the state did!” Sure, a hitman doesn’t kill by himself either—he just pulls the trigger. And the client is completely innocent; he only handed over the money. Every time you say “there should be a law that…”—you are literally demanding that people with weapons come to another living human being. If they don’t comply—they get fined. If they don’t pay—they get imprisoned. If they resist—they might be killed. This is the finale of any state norm. It’s just that usually, it doesn’t reach the finale; people surrender before the state decides to kill them. So next time you want to “force everyone”—look in the mirror. There stands a person ready to pay for their own comfort with someone else’s blood.

Shame : A ballot is not a civic duty, but complicity.

“I just voted, what’s the big deal?” Well, let’s break it down. You went to the polling station and checked a box for someone who promises to “restore order in sphere N.” This “order” means new bans, fines, inspections, and imprisonments. Against people who did nothing to you personally and just wanted to live their own way. You didn’t “express an opinion”; you signed a delegation for the use of violence. You signed the ledger: “Yes, I am for these people to be squeezed, those to be taxed, and those over there to be put behind bars.”

Statists should look at the British once more. They have learned to be ashamed of things they have no personal connection to—the actions of ancestors in the century before last. Therefore, let them not think that they cannot be made ashamed of what they are committing right now. With their own hands, voices, and “wants.” And this is not radicalism, but elementary honesty with oneself. Freedom begins not with a rally, but from the moment you stop wanting to command someone else’s life!

Voluntarist, Bitarch

Why parents should be interested in treating psychopathy in their children

Considering various approaches to solving the problem of violence using biomedical technologies, such as strengthening the violence inhibition mechanism and bio-enhancing morality, one can quite quickly conclude that the most appropriate and effective approach would be to perform such procedures as early as possible. Moreover, signs of psychopathic traits, which are the strongest predictors of violent behavior and indicate dysfunction of the violence inhibitor, can be detected as early as childhood, even at the age of 2-4 years, as demonstrated by research.

It is important to understand that if an individual with a risk of developing a violent and psychopathic personality undergoes morality bio-enhancement very early, they will essentially not even have a chance to be such a personality for even a short time. Furthermore, the nervous system at this age is still developing, which makes it possible to achieve an effective result even with gentle intervention. Widespread practice in detecting and correcting violence inhibitor dysfunction could solve the problem of violence in society long before it even arises.

This should already be enough to convey to many parents how important it is to carefully monitor a child’s behavior and emotional reactions (for example, empathy and whether they have an aversion to causing harm to someone), and to intervene in a timely manner upon detecting any anomalies. However, if some parents are suddenly not very concerned about what kind of personality their child will grow into, or if they see no problem with violence at all, then it is worth reminding them of another very strong motivation to consider this issue—personal well-being and the preservation of their own nerves.

Research on violence and psychopathy is often focused on the person with such a condition—their behavior, the risks to society, and criminal manifestations. Some of it discusses the role parents may play in the development of psychopathic traits in a child. At the same time, the opposite problem remains in the shadow—when parents become the very first victims of heartlessness, manipulative behavior, lack of empathy, and even cruelty on the part of their own child.

Of course, it is not customary to label children as psychopaths, but they may demonstrate early signs of this condition or so-called callous-unemotional traits—emotional numbness, lack of guilt, and an inability to empathize. Such signs indicate that the child does not simply have a “difficult character”; we are talking about deep-seated personality characteristics which, among other problems, can seriously destroy family dynamics.

For parents, such a child becomes a severe psychological trial. Parenthood brings them no pleasure, only daily problems. They find themselves in a trap: on one hand, the social expectation to love and support their child, and on the other, constant stress, fear, and a sense of helplessness. Often, such families face a lack of understanding from others and even accusations of poor parenting, which only increases their sense of isolation and guilt. Parents may also face very serious problems if their child begins to behave antisocially in society, as they will have to bear responsibility for their actions.

All this being said, it must be understood that good upbringing and a favorable environment alone may not be enough to prevent a child from developing a psychopathic personality (although this is, of course, also important for reducing the risk). Therefore, all parents have an interest in detecting early signs of this condition and resorting to therapeutic intervention if they are present. This will certainly help them preserve their own family, and with widespread practice, it will also lead to a reduction in the level of violence throughout society, and over time—to the complete eradication of this problem!

Voluntarist, Bitarch

The Problem of Cartel Collusion in the Sphere of Protection under Ancap

Mancur Olson, in “The Logic of Collective Action,” proved that small groups with concentrated interests always win the coordination game against a diffuse majority due to the free-rider problem. Three CEOs will agree over dinner; a million customers never will, because each rationally waits for others to take the risk first.

What specific mechanism in ancap prevents a cartel agreement between two or three of the largest protection agencies to divide territories?

Konweni

This is a question that also concerned David Friedman. In the chapter “The Mechanics of Freedom,” concerning economies of scale, he reasons that in the law enforcement market, there seems to be a more pronounced positive economy of scale than he initially thought, which in turn increases the likelihood of a cartel agreement.

It seems to me that the cause of this excessive pessimism is the overestimation of the importance of direct armed protection in the security market. Literary descriptions of the security market under ancap are filled with some kind of universal protection agencies that are responsible for security in general across the most diverse aspects and scale easily. Of course, such an initial monopoly, already given in the problem statement, leads an honest analyst to conclude that such agencies will tend to grow significantly and enter into cartels, and their impact on people will be completely total, making the sale of such security services terribly dangerous for clients, as it is only one step away from total enslavement.

But where will these protection agencies come from? Who will be their clients, and what services will they buy from them?

Suppose I don’t live in peaceful Montenegro, where every house has a legal shotgun plus a couple of black guns left over from the war, but, say, in some place like Brazil. I have reasons to fear street attacks, car theft, and break-ins at my home. And then, a startup opens in the city that is ready to serve me, even if I wander into the favelas. What does such a startup need, within the technologies relevant at the time of writing this post? To reach an agreement with the company that owns the lamp posts to place cameras on them, as well as landing pads for drones with a charging function. Then, AI tracks suspicious actions, such as breaking into a house door or a car; a drone takes off from the nearest pole and demands a justification for the legality of the actions. In the case of an aggressive response, it applies measures of influence to the suspect, for example, firing a taser, after which it calls a live squad to process the detention. Similarly, in the case of an attack on a person: it flies in, demands they stop, reasons with those who ignore the instruction, waits for the squad, and returns to the nest. And then comes the court proceeding regarding how much to recover from the aggressor.

After working in this market for six months, the startup is surprised to find that its services are becoming less in demand because the city has become noticeably safer. And what, should they now start harassing me clandestinely so that I renew my subscription? No, of course not; they will simply make the subscription cheaper, and the drones that spend most of their time idle will be used, for example, for delivering pizza.

And what about peaceful Montenegro—do I not need protection agency services there at all? Of course I do. I need it so that when I break my leg while hiking in the mountains, brave rescuers in a helicopter fly to me and pull me out of that hole. Or pull me out of a car that flew off a cliff. Or find me in the sea when a storm carries me far from shore on a SUP board. Or get a cat down from a tree.

You realize that a Brazilian security startup won’t be able to enter the Montenegrin market because that market is completely different? Protection agencies are doomed to locality due to the local nature of threats, and are also doomed to a small size because the nature of threats also tends to change. It is harder for a large company to change, which means inefficiency, and inefficiency means saying goodbye to market share.

But surely there are functions for protection agencies that would be in demand globally? Of course there are, but these are specialized functions. For example, to find someone anywhere on planet Earth who owes me a vast amount of money and refuses to return it. Or a person who killed my mother and knows that I would like to burn him on her funeral pyre because she will need a servant there. Such agencies will not sell a subscription for service; they will have to take on rare one-off orders, as this market is too specific. It is impossible to build global dominance with the prospect of bending anyone to your will and subjecting them to your sinister market power based on this.

And what about the prospect of an external armed invasion? Shouldn’t private military companies be the backbone of any respectable social order if it wishes to call itself ancap? Shouldn’t such companies unite into a mega-cartel dictating its will to all of humanity? To the great regret of the adepts of this branch of human development, in peacetime, the peaceful average citizen is not inclined to finance the military. He doesn’t need war; he doesn’t buy it. An invasion army can only be equipped if you establish taxation on your territory. However, a militia for protection against an invasion army organizes itself in the presence of a free market—quickly, efficiently, and not too expensively, as shown by the experience of at least the Ukrainian war.

Fight, flight, freeze… or just hack someone else’s brain?

As we know, there are three basic survival strategies in the wild. Encountered danger? In that case, fight, flee (“run”), or play dead (“freeze”/”hide”). But here’s the thing: while we thought this was an exhaustive menu, evolution decided not to stop there. As it turns out, there is a fourth, far more sophisticated path in the wild. Let’s call it “hack your neighbor’s neurobiology.”

Imagine: you are a huge, strong tropical cockroach. An emerald cockroach wasp (which is about three times smaller than you) flies up to you and gives you a quick sting. You are alive, you are conscious, your legs are working. But you… don’t want anything anymore. The wasp delivers a second, surgically precise sting directly into the cockroach’s subesophageal ganglion (the brain). Its venom acts as a perfect blocker of octopamine—the neurotransmitter responsible for initiative and the motivation to move. The cockroach is not paralyzed! It simply completely loses its free will. It is in a state of severe apathy. The wasp takes the giant by its antenna and, like a compliant dog on a leash, leads it to its burrow, where it will lay an egg on it. The larva will eat the cockroach alive, and the cockroach won’t even attempt to escape.

There is also the famous Toxoplasma (Toxoplasma gondii). This single-celled parasite desperately needs to get into a cat’s intestine—that is the only place where it can reproduce. But how do you get there if you are currently inside a mouse? Toxoplasma doesn’t just wait for the mouse to be eaten by chance. It takes control! The parasite forms microscopic cysts in the amygdala of the mouse’s brain, as a result of which the mouse completely loses its innate terror of the smell of cat urine, or even begins to experience slight sexual arousal from it. The mouse goes out into the open on its own, searches for a cat, and predictably becomes its lunch.

Another very cool example: the lancet fluke—a flatworm that needs to get from an ant into the stomach of a sheep or a cow. It penetrates directly into the ant’s subesophageal ganglion and takes the helm like a seasoned truck driver. In the evening, when it gets cold, the parasite forces the ant to separate from the colony, climb to the very tip of a tall blade of grass, and cling to it firmly with its jaws. The ant hangs there and waits to be swallowed by a cow. But do you know what is most amazing? If the cow doesn’t come during the night, and in the morning the sun begins to blaze (which could cause the ant to dry up and die along with the parasite), the worm releases control! It allows the ant to unclench its jaws, descend to the ground, and hide in the shade. The ant spends the whole day living its usual ant life, and in the evening, the parasite presses the button again: “Time to climb the blade of grass!”. And so it goes until they are eaten.

Why is this so cool? When we hear the word “parasite,” we imagine someone who just drinks blood or steals nutrients. But evolution has shown: information and control over behavior are the most valuable resources. These creatures do not control the victim through fear. They use perfect knowledge of neuropharmacology. They synthesize analogues of dopamine, serotonin, various alkaloids and proteins that “hack” the neural circuits of other species. This is not a random system glitch, but the result of millions of years of harsh evolutionary selection. Those who learned to change the host’s behavior in their favor survived and reproduced much more effectively than those who just sat and waited for a miracle. And nature didn’t give a damn about philosophical concepts like “free will”!

What does this mean for us, humans? Acting upon the neurobiology of an opponent who threatens us with harm—for the sake of bio-enhancing morality or as a violence inhibitor—is also not some “madman’s rambling,” but a fully successful strategy supported by millions of years of evolution, which is becoming technologically more accessible to us every day. If you don’t like such an approach at all, then look at yourself and propose full recognition of the Non-Aggression Principle (NAP) and the impermissibility of violence in exchange for the limitation of biotech weapons that affect behavior.

Voluntarist, Bitarch

Continuing to settle into Nostr: building a pyramid

In my previous post on this topic, I told you how I set up my own personal Nostr relay. I used strfry, which is quite popular for large relays because it is stable and performant. However, I also wanted ease of configuration so that I wouldn’t have to work magic with console commands every time. An attempt to attach a web control panel on top of the existing relay was unsuccessful. The Khatru relay suggested by Grok turned out to be a project abandoned in early 2026. But its developer is @fiatjaf, the author of Nostr itself, and he doesn’t just abandon projects. So I started looking into what he is developing as a replacement and came across Pyramid. This is a specialized relay for community management; meaning, while it can handle basic relay functions, it also helps manage various private and club-like features.

After some tinkering, I uninstalled strfry and installed pyramid. Voila — I have an engine for developing an online community, and half a day later, the first invited client of the new relay appears. We discuss the process on Nostr in the comments of my previous post, and I tag the software creator. Fiatjaf likes this comment and then comes to me on Telegram, congratulates me on installing Pyramid, and starts asking for feedback on both the relay and Nostr in general. We already had a chat history from the time when he created a popular custodial Lightning wallet in the form of a Telegram bot, and I actively promoted it (that project was wound down, and Nostr emerged to replace it).

Anyway, I gave all the feedback I was capable of, given my limited experience and competence:

  • I asked for a more convenient format for adding a new user to the relay: the user clicks to leave a request, I click to approve or deny the request — basically, the familiar Telegram method. I received a promise that this would be done soon.
  • I asked for a monitoring service for relay availability from different corners of the network, suggesting an implementation option that doesn’t require renting servers all over the world. Fiatjaf said the option was doubtful, but he would try to attach one third-party service instead.
  • I asked for a service for local key generation so that new users could be sure that the Nostr client would not have access to their private key. He replied that he had already built a whole set of such utilities — both for offline key generation and for offline event signing, so security advocates can sleep soundly.

That’s where my imagination ran out for now, but I certainly assume that readers have or will soon have their own brilliant ideas.

Anyway, for anyone interested in testing a specialized relay for community management, welcome. Leave requests in the comments, and I will send the invitation link via DM — for now, this is the not-so-convenient connection mechanism in place.

https://stuff.fiatjaf.com — a collection of various things from the author of Nostr

https://github.com/fiatjaf/pyramid — description of the Pyramid relay

https://relay.ancapchan.info — my relay, where you can observe the community participant tree growing and publications appearing from them

I hope you won’t need a special guide on how to set up a Nostr account. Since it is a very decentralized ecosystem, there are already tons of ways to enter it, as well as ways to use it. But anyway, let me recommend that you start exploring via the Nostria client. I also know the developer there, Sondre Bjellos, a participant in the Liberstad and Montelibero projects; he lives three kilometers away from me (when he doesn’t head back to his native Norway, of course) and is very actively developing his client.

VPN in Russia 2026: a guide for those who do not want to live in a digital GULAG

The current internet situation in Russia resembles a joke: “We have freedom of speech, but no freedom after speech.” Only now, it’s no longer a joke, but daily reality. Roskomnadzor has blocked 800+ VPN services, TSPU has learned to recognize protocols in seconds, and since March 2026, “white lists” have even begun to be tested in Moscow—meaning only what is approved from above is allowed. Welcome to the sovereign internet! But we aren’t the type to give up, are we? So let’s break down what actually works.

Why are options like NordVPN and ExpressVPN no longer viable? In short: mass commercial VPNs are dead in Russia. OpenVPN is detected in seconds by the first byte of the packet. WireGuard is detected by its UDP structure. L2TP, PPTP, and SOCKS5 have been blocked since December 2025. Classic Shadowsocks is identified via entropy analysis. What works? Next-generation protocols: VLESS + Reality (mimics regular HTTPS to a legitimate site), AmneziaWG (a modified WireGuard with mimicry), Hysteria2 (based on QUIC), and xHTTP (fragments traffic to bypass TCP Freezing). But which VPN provider should we choose then?

1) Mullvad (Sweden) – the absolute gold standard of privacy. It doesn’t require an email—it generates a random account number. It accepts cash in an envelope (yes, literally put euros in an envelope and send it to Sweden), Monero, and Bitcoin. In 2023, Swedish police conducted a search at the request of Germany—and didn’t find a single byte of user data. This is the best proof of a “no-logs” policy imaginable. Of course, there is a downside: Roskomnadzor deliberately blocks Mullvad IP addresses, so you have to cycle through servers. The app has been removed from the Russian App Store.

2) IVPN (Gibraltar) – Mullvad’s closest competitor in terms of paranoia (in a good way). Also no email, just a random Account ID. Cash, Monero (they have their own Full Node—no third-party payment gateways), and Bitcoin. A security audit by Cure53 has been conducted. V2Ray obfuscation (VMESS/QUIC and VMESS/TCP) is built into all clients. Exemplary split tunneling—both direct and inverted. Ideal for those who need to access Gosuslugi and read blocked media simultaneously.

3) Proton VPN (Switzerland) – Stealth protocol, four Securitum audits, and a history of rejecting all legal requests for data. There is a free plan with unlimited traffic. However: it requires an email (you can use an anonymous ProtonMail registered via TOR), it doesn’t accept Monero directly, and Roskomnadzor actively tries to block it. Lifehack: manually loading WireGuard configs often works when the app cannot connect.

Note that as of May 2026, the Ministry of Digital Development has required large platforms to block access via VPN. The solution: split tunneling—route banks and government services outside the tunnel, and everything else through the VPN. There is also an advanced scheme against “white lists”: Client → Russian VPS (on the white list) → foreign server. TSPU sees domestic traffic and leaves it alone.

Why will you never be punished for the mere fact of using a VPN?! This is a favorite scare tactic of propagandists, but it collapses against reality. First, TSPU physically cannot distinguish VPN traffic from regular HTTPS with 100% accuracy—that’s exactly how VLESS and Reality are built. Fining people for “suspicious traffic”? How many people and on what grounds would they even have to sue. Second, VPNs are the backbone of legal business. Every bank, every corporation, every remote worker uses a VPN daily. And third: introducing liability for the “fact of using a VPN” would immediately lead to millions of people connecting via other people’s Wi-Fi networks. We would end up with millions of criminal cases against 80-year-old grandmothers whose routers “used a VPN.” Imagine the headlines: “Pensioner from Saratov fined for bypassing blocks.” No government can afford such a level of absurdity—it would be political suicide. Therefore, the state’s strategy is different: not to punish users, but to make VPNs as inconvenient as possible. Our task is to stay one step ahead. After all, freedom is not something given, but something taken!

Voluntarist, Bitarch