Jeffrey Tucker: Is the World Ready for a Crypto-Currency Monetary System?
Presented at Bitcoin South; Speakers list and videos
Tucker is Chief Liberty Office of Liberty.me, a social network and online publishing platform for the liberty minded. He is also a distinguished fellow for the Foundation for Economic Education, executive editor of Laissez-Faire Books, research fellow for Acton Institute, founder of CryptoCurrency Conference, and author of five books. BraveNewCoin sat down after his presentation at Bitcoin South, and asked Tucker about his take on Bitcoin:
Tucker: Progression not Repetition
For 6000 year we’ve had problems with money. The problem is that it takes up space and it weighs something. So we’ve had to trust third parties with money, that’s always been a problem. At a certain level of financial sophistication you end up having to rely on banks and third parties to port your money, and Bitcoin is something completely different. In that sense it’s just an epic change.
One of the things I didn’t cover in my talk yesterday was another stage of monetary failure, which occurred in mid-1980. The supply-siders took over the management of the US dollar system and what they tried to do, it seems incredible when I think back on it, they tried to fix exchange rates.
This is before the Euro existed. So there’s all these different European Currencies and they were trying to on one hand fix all the European Currencies, one against the other, the Franc against the Deutschmark, and then they were going to fix the dollar against the Deutschmarks, and the dollar against the Yen, and so on, and gradually tied these things together. Not by statute, but by precise management of monetary policy and lock them into place and they imagined they could do this, as a world accord essentially. This was supposed to be Stage one.
Now stage two was once the currencies became really stabilised they were going to create an index fund and tie that global index currency fund to the special drawing right, which is a currency issued by the international monetary fund, and then that was going to be the basis for the creation of a Global Central Bank, which was supposed to be essentially the IMF working with the Bank for International Settlements, and we would have a Global Central Bank and a Global Currency. That was their agenda, and they planned to accomplish this by the end of the 1980’s.
You look back at this now and think, “What were they thinking! It’s crazy stuff!” They didn’t even get to stage one, but they all believed that they could do it and vast resources were spent to accomplish this through meetings and time. And eventually they had to wash their hands of it.
So 2008 was a big moment, because it was the first time the final piece was put into place to make crypto currency possible. Crypto is so much better, you really don’t get the big economic change unless you can do something to break the network effect of the old model. I have thought about this a lot, is crypto really good enough to replace national currencies? and I think the answer is yes. It’s just a matter of trying to get people to have experience with it.
The beautiful thing about the world we are seeing is none of us really know the shape it’s going to take. There’s a surprise around every corner. A lot of us are really speculating right now. It’s amusing to come to a conference like this because you can see the people are thinking ten years ahead for where the reality is right now. But that’s the way you get change, you have to imagine a future before you can build it.
There is a social consensus that emerges around a certain paradigm, and it lasts a very long time, even when it is not working well. It begins to break down when the anomalies within the paradigm begin to overwhelm the system.
And then you enter into what Thomas Khun describes as pre-paradigmatic state. So there’s just chaos. Nobody knows the explanation, nobody has a theory, you know there’s not a consensus around a single model for how the world can, should and does operate. So you get a scramble before the emergence of a new paradigm that takes place.
I think what matters here is that the new paradigm is not really a system that we have to implement. It’s something that emerges gradually through evolution. How does this happen? It’s because people find systems that work better than the old systems. You find certain education models that are better for what they want to accomplish. Transportation systems, and we are seeing this happen every day. Financial systems. Ultimately people like to use products and services that serve their lives better.
So I think through this, we don’t have to bring about an ideological change really, we just have to offer the goods and services and say, ‘look what do you think about this?’ This is how municipal transportation services in the US are collapsing. It has happened one year to the next. This time last year there was no threat to the cartels and monopolies that ran transportation in large cities in the United States. A year later, their monopolies are crumbling and the price of their medallions, the cartel privileges are falling now dramatically. It’s like a micro-revolution happening that’s a beautiful paradigm because I think the same thing that is happening in transportation is going to happen in finance, money and every other sector.
It’s funny, you think of other great revolutions in history, such as the industrial revolution. People didn’t have an awareness that there was an industrial revolution going on. You didn’t wake up in the morning and go “it’s great to be alive in the industrial revolution!” You didn’t have that sense, but there are some people that are very aware of what’s happening today in the digital revolution. Many of them are at this conference. Most people are just consumers, and they don’t have an awareness of this structural change now effecting the world. But there is now a generation such as yourself and many intellectuals and writers who are profoundly aware of what is happening and we are all working very hard to document this very carefully. I am now finishing up my sixth book. I myself have this passion to document the progress of our age.
Videos and Articles from the Bitcoin South conference can be found here, or through the Resources & Info tab on BraveNewCoin