Тег: Discussion

Containing the stationary bandit, a discussion. Hopefully, the end.

Bitarch’s Column

Holon Synergetic has published an article criticizing the deterrence doctrine, which we write about periodically. Let’s clarify some points.

1) One should not confuse the deterrence doctrine with terrorism. DD is a strategy for increasing the costs of initiating aggression. Methods for increasing costs may not involve the use of physical violence at all. Perhaps Holon has not read all of our articles on DD and missed this one. If DD is non-violent, it is harder for the state to slap a terrorist label on libertarians.

2) No wunderwaffen (robo-bees, genetically modified viruses, and especially doomsday weapons) are required for DD. Relying on wunderwaffen is by no means a libertarian strategy, as they are extremely complex, expensive, and will be available to few (meaning these people will be able to coerce others, ultimately recreating the status quo). For a stable free society according to Hirschleifer, a balance of violence potential (BVP) is needed; that is, weapons and deterrence strategies must be extremely simple and accessible to the maximum number of people.

3) For deterrence weapons, unlike weapons for classical wars, the “shell and armor” competition is practically inapplicable. Unacceptable damage can be inflicted in a million different ways, and new ones are constantly appearing. It is not for nothing that after the appearance of nuclear weapons, people began to talk about nuclear deterrence, rather than the development of a nuclear bomb neutralizer.

To protect against each type of deterrence weapon, separate “armor” is needed. For example, if the deterring party has ballistic missiles, cruise missiles, and micro-drones, to intercept a retaliatory strike, one must have air defense/missile defense for each type, and with a large margin. So many ways to cause pain can be devised that even the nearly boundless US military budget would not be enough for defense.

4) An excursion into the history of medieval proto-panarchies shows that the demand for such institutions has existed for a long time, and now the theory is better developed and the technological level is higher. Furthermore, it is not necessary to involve the entire society in DD. Even a few will create a positive externality for others, as the example of the Femgericht perfectly demonstrates.

5) Regarding universal transparency, a standalone deterrence strategy can also be created on its basis. A libertarian jurisdiction might have no weapons for a retaliatory strike against state facilities at all, only many cameras and streaming to the network (to a server that is not subject to censorship and via a channel that cannot be suppressed—for example, Elon Musk’s Starlink, which uses a narrow beam). If a stationary bandit attempts to attack this jurisdiction, the broadcast of the attack to the network with all its juicy moments will deal a blow to the legitimacy of the government (tolerance for violence is currently extremely low, and various human rights activists will begin to undermine the careers of those who ordered the attack). Residents of such a libertarian jurisdiction would not need weapons more complex than household items—only to make the picture more colorful, otherwise the brief “they flew in and rounded them up” show will not gain a critical mass of views.

A similar strategy was successfully used by American black civil rights activists in the 1950s. Black activists sat in seats for whites on buses, refused to give them up at the request of the conductor, and the police arrested them. Public organizations often paid their fines to multiply the number of participants in such actions. Such cases were actively covered in the media, and irritation toward officials supporting segregation began to grow in society. Eventually, the supporters of segregation had to give in.

Rosa Parks, pioneer of trolling bus companies and segregation laws

Discussion on the stationary bandit and the doctrine of deterrence

I commented on Bitark’s column about promoting libertarianism through the theory of the stationary bandit to the effect that this is largely knocking on an open door: the bandit nature of the state is quickly recognized by any interlocutor, and from there, discussions begin about the lesser of two evils. In particular, in Russia, there is a popular theme of appealing to the experience of the nineties of the last century, when there was a dominance of nomadic bandits.

In response, Bitark suggests in his VKontakte public page turning to Hirshleifer’s 1995 research, which Professor Ausan referenced in his lecture “The Evolution of the Stationary Bandit”

All three conditions for the stability of anarchy according to Hirshleifer were not met in Russia in the nineties, meaning there was no libertarianism in the nineties.

To this, I am forced to state that Bitark is again knocking on an open door, and there is no question that there was libertarianism in the nineties, unless, of course, you are arguing with a troll. The point is that to promote libertarianism through the theory of the stationary bandit, one needs to present arguments on how to prevent the dominance of nomadic bandits after abolishing the stationary one.

Also interesting is the criticism from Vladimir Zolotorev, who quite rightly points out that a stationary bandit is more dangerous than a nomadic one, because he is capable of inflicting far greater damage on society, and at the same time ensures that society is left with no strength to fight any bandits whatsoever. He does not write it explicitly, but it follows from this premise that returning to the era of nomadic bandits is an acceptable price for society to pay for the destruction of the stationary bandit, although, ideally, the choice should be not between stationary and nomadic bandits, but between the presence of a bandit and their absence.

So, we seem to have agreed: the bandit is not needed, let’s get rid of him, we need to ensure a balance of violence potential in society, and we will have stable anarchy. But then, from a reader with the nickname Holon Synergetic, came criticism of the proposed mechanisms of the deterrence doctrine (the text arrived via private channels, and I am publishing it on Telegraph, which serves as a neutral platform).

The text is very long and difficult to perceive, so I will provide a brief explication:

1. As follows from Mazarra’s article on the deterrence doctrine, the translation of which I recently posted, the perception factor is very important for successful deterrence. The opponent must understand that when a potential victim shouts, “I’ll pull your eye over your ass if you take one more step,” the victim is actually ready to carry out their threats because they are backed into a corner and have no way out other than to unleash their arsenals for pulling eyes over asses. At the same time, the potential aggressor must by no means be put in an equally desperate position where they have no choice but to risk an eye and take a step forward. However, the more successfully such a doctrine is implemented, the more often threats will be a bluff—simply for reasons of economy.
2. The state also implements a deterrence doctrine regarding members of society who wish to destroy it. One of the most reliable ways for it is to take society hostage. Every member of society must understand that any threats or, God forbid, real actions against state representatives will only make things worse for a conditional city like Voronezh. Thus, the state invented the concept of extremism, and now extremists are to blame for any tightening of the screws; all these security measures are undertaken precisely to protect society from them. Rare successful actions against the state only confirm that extremism is not a fiction and state security measures are justified.
3. Attempts to propose increasingly technological weapons for fighting state representatives, such as micro-drones and the uberization of violence, will lead to the state starting to protect citizens from micro-drones and uber-violence with great pleasure, and for this, completely totalitarian methods of control over all aspects of life will be required. In the limit, this arms race leads to a situation where doomsday weapons become available to everyone, and then it’s just coffin, coffin, cemetery, game over.
4. As a dessert, there is a historical excursion into medieval Saxony, where something very close to my described concept of uber-retribution was successfully practiced. Nevertheless, the system did not survive its time, like all other medieval elements of panarchy, and gave way to the state monopoly on judgment and punishment. The author suggests thinking about whether such an outcome was inevitable.

The main conclusion I would draw from this tangle of arguments is the following consideration. No single doctrine is a panacea. The state is in the minds. This means that although in some cases the problem of the state can be successfully simplified by cutting off particularly obstructive heads or the threat of such decapitation, the decisive importance still lies with the means of indoctrination in freedom. These, in turn, must be selected individually.

In Defense of TON

Andrey

I received a detailed review of my answer about TON in the chat , and with the author’s permission, I am publishing it here.

if nothing but Telegram is required to use the coins

Yes, having Telegram will be a sufficient, but not necessary condition for using the coins.

But there will be a need for the ability to buy gram quickly and conveniently for fiat

I don’t think that buying Gram will be harder than buying popular altcoins like Ethereum, especially since the development team has enough resources to organize such exchanges. And considering that identity verification tools are already built into Telegram, this will be even easier from a regulatory compliance perspective.

why is it needed as money, since there are bitcoins themselves

  • Due to high transaction speed: 5 seconds are enough to “confirm” a small amount transaction, compared to several dozen minutes for bitcoin.
  • Even lower fees: a PoS rather than a PoW consensus mechanism is used, so block creators do not have to perform generally useless work calculating hashes (block mining), and end users do not have to pay for it.
  • Built-in support for smart contracts and the ability to create your own applications (services) based on the network itself (the project includes more than just a blockchain) and these smart contracts, accepting grams as payment for their services.

I would still prefer to keep my (long-term) savings in bitcoins, but for everyday use, grams are definitely more convenient. The question “why grams when there are bitcoins” sounds roughly like “why fiat when there is gold”.

Low emission rates

According to the white paper, inflation is expected to be (no more than) 2% per year (the number of existing grams will double in 35 years), through the emission of new grams as rewards for validators.

Indeed, the number of bitcoins is fundamentally limited, and inflation decreases with each new halving, but ultimately the work of miners will be paid for not by the emission of new bitcoins, but by transaction fees, which could lead either to their increase or to a decrease in mining difficulty, and thus, to the overall security of the blockchain.

Firstly, for the sake of high transaction speed, it is intended to keep a very modest number of nodes

It is intended to keep about 1000 validators creating blocks, and as many “full nodes” as desired, which, in particular, will be able to point out validator errors, which, if confirmed, will result in the loss of the deposit and the transfer of part of it to the full node as a reward (the remaining part is irrevocably “burned”). As Nikolai Durov himself writes, despite the large number of full nodes in the bitcoin or ethereum networks, they are privately combined into large pools, which ultimately leads to the fact that, for example, 75% of all new blocks are created by fewer than ten miners/pools. Since it becomes even easier to create pools under a PoS consensus mechanism (those interested simply chip in for a deposit on one server, which then returns part of the reward to them), validators correspond almost exactly to mining pools/large miners. So a system of 1000 validators looks even more decentralized than the current state of affairs in existing cryptocurrencies.

Moreover, at the protocol level, the validator with the largest deposit is prohibited from having more than the deposit of the validator with the minimum deposit multiplied by a certain constant L. Thus, the system itself encourages “pool” participants to choose not the largest validator, but validators with smaller deposits, maintaining decentralization.

If these funds can be managed without Telegram, then it is unclear what Telegram has to do with it.

Funds will be manageable using a set of tools as diverse as those for bitcoin—a “wallet” can be created using existing programs or even by writing your own. Telegram is only involved in that, firstly, TON is being developed by the Telegram team, and secondly, a light client for this entire ecosystem will be built into the Telegram app, which will automatically create a user base of several hundred million people. The network itself is planned to be renamed simply to Open Network a few years after launch.

And, of course, it is currently difficult to consider a currency that depends entirely on a single creator as decentralized

In principle, Ethereum also depends quite heavily on Vitalik Buterin. In fact, in the early stages (while the project is being “refined”), it is indeed planned that the deciding vote in the case of changes to some configurable parameters (of which there are many, by the way, to avoid hard forks) will belong to the TON Foundation, as well as owning the majority of validators. But this is ensured only by the amount of currency in the TON Reserve, which sells and buys grams (in exchange for dollars) according to a pre-set algorithm to reduce possible exchange rate fluctuations. As soon as the majority of grams are sold (which is actually equivalent to the project “taking off,” as the number of sales depends on the rate), the TON Foundation will lose its privileges.

Overall, the essence of the TON project is to create a platform for decentralized and (partially) centralized services that would be impossible to control from the outside—so, besides cryptocurrency, TON will have a built-in proxy system, for example, allowing the creation of tunnels like VPN and TOR and, if desired, collecting payment for traffic passing through them using the built-in cryptocurrency or a micropayment system. Services can provide their offerings using all the conveniences of centralization (more efficient request processing), while users will be protected from contract violations on their part thanks to decentralized smart contracts in the blockchain—and without any (government) courts. That is, the idea is to create a new market uncontrollable by states, and from there it will work itself out.

Continuation of the discussion about reputation

Bitarch replies:

You wrote a review of my reputation proposal, but it seems you didn’t understand the exact essence of the idea. You write:

As for the system you proposed, people will be willing to take its recommendations into account only if, for some reason, it becomes very important to them that a person, for the sake of increasing their reputation, be willing to contribute to charity.

The main goal of the system is not to show one’s generosity to others, but to create a mechanism for the value of a reputational entity, which will then be a pity to lose. Game theory comes into play, making deceiving other people economically disadvantageous. The original idea was proposed by the developers of the OpenBazaar project; I modified it for application in real society.

Reputation Pledges
OpenBazaar implements proof-of-burn in a different way. On the OpenBazaar network, users can choose to be pseudonymous, meaning you don’t know their true identity. As such, it can sometimes be difficult to determine if they are trustworthy or should be avoided. A reputation system is important to help inform the network of which participants have acted honestly in the past, and which haven’t. There are several facets to the OpenBazaar reputation system, which is still being built, and you can read about the overall system here. One part of this system is Reputation Pledges. This means that a user has chosen to prove their commitment to their OpenBazaar identity by burning a certain amount of bitcoin. The act of burning coins shows the network that the user is committed to their identity because they’ve now expended resources on it, and if they incur a negative reputation then those resources will have gone to waste.


https://openbazaar.org/blog/proof-of-burn-and-reputation-pledges

Indeed, that’s roughly how reputation works. “No one remembers McFlurry the bridge builder! But once I fucked a goat…”

Thank you for the clarification that charity in the proposed engine is not that important, the main thing is the willingness itself to confirm one’s reliability through the expenditure of resources. This could indeed prove important for an outsider to gain traction on a particular trading platform. They could spend money on advertising, or instead, or in addition, spend it on boosting their karma, and this would also perfectly demonstrate their willingness to play fair.

But I thought it important to note that it is pointless to try and stretch any such mechanisms to fit all cases in life. A person can be honest and respectable, like Alexei Karenin, but his wife will still throw herself under a train because in her eyes, he is an inhuman machine.

— I don’t understand why you hate me so much? What have I done wrong to you?
— Fuck a goat, Onegin!

Reputation under ancap, part 2

Yesterday I published a model of a reputation engine for ancap that was submitted to me for review, and today I will tell you what I think about it

I will start, as usual, with a definition. Reputation is the conclusion drawn by a potential counterparty regarding a certain subject and the prospects of interacting with them, based on the full extent of their knowledge about that subject. Thus, reputation is not a property of the subject. My reputation in the eyes of socialism-chan and my reputation in the eyes of minarchism-chan are two completely different reputations, and the difference between them is no less than the difference between the concepts of “execution” and “a fine”.

Many have heard about the Chinese social credit system. The state collects a vast amount of the most diverse data about a citizen, then using an incredibly complex and opaque algorithm, it puts two and two together and concludes how reliable this citizen appears to be to the state. The higher the rating, the more freedoms it is willing to grant the citizen; the lower it is, the more it restricts them. The goal of this entire system is social engineering—the cultivation of the perfect human of the future. I don’t know if market offers for “boosting” ratings have appeared yet, but if not, they simply must appear soon.

Everyone knows about the Russian Unified State Exam (USE) system. The state forces schoolchildren to take a test of monstrous proportions, and then forces universities to admit applicants based on a single criterion: the result of this test. I don’t need to tell you what phenomenal results are demonstrated in this test by natives of certain national republics.

Examples can be multiplied, but I think it is already clear that the forceful imposition of one’s own assessments of someone’s reputation on others is not the true Tao. It’s not even about the fact that such systems will be attempted to be cheated, but about the coercion itself. In ancap, however, any system that collects certain data about people and derives assessments from it can be implemented only if people voluntarily begin to use that system.

How do I envision a near-ideal reputation system? Something like this:
— Siri, look at the proposal from Bitarch; can this guy be trusted?
— I have performed an express analysis of the proposal itself and what is available about Bitarch in open sources. Based on your previous preferences, Ancap-sama, the probability that you will trust him is 85%. The probability that he will betray your trust should cooperation begin is 7%. You specified a trust threshold of 80%; may I respond to him affirmatively, or would you like to review the details?
— Give me the details.
— Hi!

Of course, just as people try to get the maximum score on the USE or the maximum social rating in China, they will want to optimize their requests for the reputation assessment system I use—in this example, Siri. But they will strive to earn my trust in the same way now, when a lot of data has to be collected manually.

The more routine I want to remove from my life, the more typical decisions will be entrusted to my virtual consigliere. But first, one way or another, I will have to train this neural network on my preferences; otherwise, the result is unlikely to consistently please me.

Siri, scratch my back, please!

As for the system you proposed, people will be willing to take its recommendations into account only if it somehow becomes very important to them that a person, for the sake of increasing their reputation, be willing to contribute to charity. I doubt such a quality would concern me if, for example, I am looking for a one-night stand or choosing a model of hiking boots. But if I need to find a home for a litter of homeless kittens, then that’s a different story.

Reputation under ancap

Bitarch (topic disclosure paid in the amount of 0.005btc)

Today I have an unusual format. In essence, this is not about answering a question, but a review of a full, detailed proposal. Therefore, I would like to split the topic into two posts. Today’s post will outline the proposal itself, and in tomorrow’s, I would like to provide a detailed overview of the topic of reputation and the construction of reputation systems. Discussion in the comments is highly welcome.

As we all understand, under ancap, the institution of reputation will play a significant role. Imagine that a person is not yet well-known in the community or wants to atone for their past “sins” by creating or restoring a reputation. There is an organization or a blockchain project to which this person can make a donation and receive in return an ID with reputation points. They can show this to other people when conducting transactions to increase trust. If they cheat, the victim can file a complaint with this system, and the fraudster will lose the reputation points for which they previously made a donation (more precisely, their ID with negative reviews will be useless for concluding deals in the future). To exclude fraud on the part of the victim, the reputation service may also require them to make a donation of a similar amount (and they will also make their own reputation ID useless if they lie and are caught). The result is a reputation system in which it is not profitable for the parties to deceive each other from the perspective of game theory. The donations received can be directed toward funding public goods (schools, hospitals, roads, science, ecology, etc.), simultaneously finally dismantling the main argument of statists against libertarians: “If a person has no insurance and no friends, who will take care of them in old age, provide medical treatment, free education for children, and so on?”.

How do you evaluate this system?

Response to the article on the value of bitcoin

Wild Turkey

On July 10, I answered a question about libertarians’ love for bitcoin. The author of the question sent their objections to this answer.

Mises, in creating the theory of money, formulated the regression theorem, according to which today’s value of money is determined by its value yesterday, and this can be traced back to the point when money was an ordinary commodity having only simple consumer value. The fact that gold specifically became the sole standard for backing money by the 20th century was the result of government regulations; in a free banking system before that, a bimetallic standard took hold, which is described in sufficient detail by the aforementioned Rothbard.

These are details; the history of bimetallism is a separate topic. Either way, money consisted of either precious metals themselves or obligations to issue them with varying degrees of reliability.

Cryptocurrency lacks this property, as does any other modern fiat currency.

Another classic of libertarianism, Hayek, openly advocated for private money…

He advocated for private money issued by banks with an obligation to quote its value pegged to a declared basket of goods. Obviously, bitcoin lacks this property.

In order to understand exactly how and thanks to what bitcoin acquired its value, I recommend reading the classic article by Jeffrey Tucker, kindly translated in 2014 by the Bitnovosti resource.

Tucker completely forgot about the subjectivism of value and sought the notorious intrinsic value, finding it in the properties of the blockchain as a payment system similar to PayPal, and the value of crypto-coins as virtual shares of such a system. A beautiful solution, but not in the spirit of the AEL and contradictory.

Thus, bitcoin, acting as digital peer-to-peer gold, does not contradict economic theory as presented by both the classics of the AEL and their modern followers.

The comparison with gold remains problematic, because gold is a unique commodity, whereas an infinite number of crypto-algorithms can be invented, and the value of any one of them is ultimately given only by novelty or the hype caused by distrust in the modern financial system.