A Brief Treatise on the Futility of Mainstream Political Action and the Promise of Smart Contracts and Cryptographic Governance

Before I touch on new techniques available to the aspiring political entrepreneur I would like to set the scene with a bleak but informative view of the poverty of our modern, mainly American, political system (not to exclude anyone!).

Public opinion has no statistically-significant impact on public policy in the United States, whereas special interests can block any bill they dislike whilst, more often than not, getting the OK from congress for their own bills.

Unless you are one of the power elite your vote, your political opinion doesn’t matter.

And while the creator of this video would have you believe that there are ways to fix this broken system, I view things more cynically. I would like to make corruption illegal, don’t get me wrong. But I have a feeling that a movement to do so would be co-opted. I see that power elites corrupt and undermine popular political movements and figures on the daily. I see that they control the media and manipulate and sculpt our attention, too. They do this, as Noam Chomsky described, by encouraging lively debate within narrow bands of opinion:

“The smart way to keep people passive and obedient is to strictly limit the spectrum of acceptable opinion, but allow very lively debate within that spectrum – even encourage the more critical and dissident views. That gives people the sense that there’s free thinking going on, while all the time the presuppositions of the system are being reinforced by the limits put on the range of the debate.”

Thus we are diverted from meaningful, profound discussions on a full-range of important issues. Instead, we seem to either A) partake in the spectacle of superficial, divisive debates orchestrated by Puppet Authority Figures on either delimited side of the argument, B) switch to thinking about the next pressing issue, “in other news…”, or C) take hit after hit of interminably-juicy celebrity gossip. The populous is dumb and it has been made dumb with brutal efficiency. But this is not the only reason that I have doubts about the promised, this-time-it’ll-be-different, Represent-Us Revolution, the plan for which you might be led to peruse if you watched until the end of the above video.

Let’s take a moment to review the basic situation here in America, and then I’ll tell you why I am not going to bother with this or any other mainstream progressive reformist movement for political change in the foreseeable future:



Like they say in the video, politicians have been bought and sold for at least 40 years in the United States. The people that run the country are in bed with the people that run the largest corporations, and only the power elite get their policies enacted with anything more than a jackpot-lottery-ticket-winning success rate. We are dealing with a more-or-less self-sustaining, self-correcting system, a well-oiled machine. The American people are uneducated and ignorant of the workings of the machine. In fact, they are prevented from getting an education — at least insofar as they are given no regular opportunities to get exposure to nuanced, unbiased debates on wide-ranging, un-preselected topics. Americans don’t necessarily inherently value intellectual pursuits or learning in general either as far as I can tell. And yet we are impoverished not only in terms of knowledge and understanding… The American people are impoverished through excessive taxation (upwards of 50%) and the intentional and unchecked inflation of their currency by the Federal Reserve Banking System; hence, they have not the money or time to care about fomenting political change. Our mental and financial resources are drained in other nefarious ways as well, like through the attention-grabbing, counterproductive drug war. America is constantly at war — no, it’s not just with drugs — and the dispossessed (on both sides of the world) are the ones footing the bill. We know that if we speak out about corruption, warmongering, taxation, coercion, the broken health-care system, or the destruction of the environment, that we are more likely to be scrutinized by Five Eyes Intelligence Agencies. Although we may not care on average as Americans that we are being spied upon, Edward Snowden and others have worked tirelessly to bring it to our attention. Those that do care and are politically and technically savvy enough perhaps know better now the extent of the surveillance and understand better the design of the Panopticon, feel its chilling effects more profoundly in their bones. It is a scary time to promote and make plans for radical, political and economic deviations from the status quo. But that fear… Perhaps it is the sign that we are entering new territory. So what would moving forward actually look like?

On to the root of the issue of how to — or how not to — create change:

The problem with Occupy, the Tea Party, Revolution.us, and the next dozen yet-to-be-shouted-from-the-rooftops Movements fed up with the status quo is that their solutions regularly rely upon established practices, methods, and institutions. They march, write, phone-in, text, plead, promote, proselytize, fund-raise, and propose legislation. Surely for their supporters, seeing a Movement Member interviewed on the nightly news is exhilarating. And it happens to some extent — perhaps just enough to satisfy this need for a broad-enough-but-still-divisive rhetorical theater in the media as Chomsky described. But my problem with these movements isn’t the limited penetration they achieve into the information-feeding troughs of the average American television viewer or web surfer. My lack of faith in their projects has little do to with their paltry track records for bringing about lasting change, in fact.

My problem lies in the reliance on third-parties in general. By third-parties I mean other groups or individuals on whom the success of the movement, or the achievement of a redress of grievances, relies. Ultimately, if some vaguely socialist democratic movement, let’s say, were to gain power, overthrow and oust the power elites, fix the broken law/financial/environmental/societal system on their own terms, what would it amount to? Obviously we can assume their victory means just what I said, that they’ve achieved what they wanted. But now we’re left with another problem, if not a bigger problem: There is a new power elite, a new administration, a new congress, a new constitution, new third-parties, and new points of failure. Reading Ursula K. LeGuin’s The Dispossessed serves as a firm reminder of the necessity of constant revolution in radical political projects. All these movements, these configurations of human capital, sadly — no matter how virile, impassioned, or disciplined — suffer from the tendency in human-dependent systems towards a centralization of power. Ultimately, this leads to their decay. I — and I believe I speak for many of my readers as well — grow weary of this kind of karmic political cycle, the investment of large sums of energy, getting the ball rolling, only to have its energy siphoned off steadily in an entropic process of attrition and a cutting of supply lines for the movement. So I ask myself if there is a better way to structure our political system. But then I have problems with democracy itself, you see… The whole thing may need to be reworked. But allow me to explain…

What’s the problem with democracy?

It’s not only about centralization and corruption for me. Here’s my problem with democracy: In the first place, in a majority-rule country like ours, at most half of the country (consider especially how few people actually vote) is able to elect the representatives and enact the policies favorable to it. Secondly, those representatives are not bound by contract to deliver on their election promises. And we could even forgive their transgressions — on both sides — those voters who were duped, those elected officials prevented from carrying out ‘the will of the people’ in one way or another. The point being no one need take the blame; this system functions (if you can call it functional) with or without consent, with or without consensus, but more often than not without either in terms of the what the whole country wants. And our media have us believing that this is the best we can do. We swallow this lie and preach it to the heathens that suggest anything else might be better. Meanwhile we swim with sharks in the shark tank, trying to lobby and protest the measly scraps of food we manage to procure as we twist and turn to avoid being eaten ourselves…

Are you telling me there is a way to 1) guarantee that policies get carried out and 2) prove that consent has been obtained from all constituents? Is there a system less vulnerable to fraud, less dependent on malleable and often unscrupulous political intermediaries?

Enter smart contracts. This is what I believe we will use to obviate corruption even if we also succeed in making corruption illegal. So support revolution.us if you want to, but know that we have the tools today to start to programmatically restructure politics or even build alternative, parallel political and legal systems. Cryptographic Governance will allow us to make the shift from being reactive to being proactive in trying to fight corruption. So how does this work, and what are smart contracts?

Let’s let Andreas Antonopoulos, Bitcoin Protocol Champion Extraordanaire, begin. Note this is a highly technical intro; rest assured, further elucidation of the ramifications of what’s being said is forthcoming.

Of course, only in the last 20 seconds or so of this verbose description of smart contracts do the non-monetary applications of this Bitcoin protocol contract scripting language receive mention.

Effectively, what Andreas is saying is that wills, trusts, and other types of agreements can be encoded using this new programming language found in the Bitcoin Protocol to be carried out without (and despite) human intervention given that certain constraints are met.

While we will want to apply this technology to politics, his first example of how a financial transaction can be secured and managed automatically through a smart contract is illustrative:

Basically, amount $XXXX will be transferred from Company A to Company B IF AND ONLY IF:

Company A signs the transaction to release the funds Escrow Company C signs off on the transfer, verifying Company B has fulfilled their end of the bargain and that Company A has the available funds in their wallet The transaction is dated after January 1, 2015, and The NASDAQ is at 2500 points

A will could be carried out along the same lines, and with it the deeds to an estate transferred, a hitherto encrypted message to the heirs unlocked, and the deceased’s collected private records expunged from all electronic databases, assuming an approved doctor’s death certificate has been uploaded to proofofextistence.com according to predefined criteria.

I think you can see where this is going. Any policy, the rules of governance of any entity, business or political, if they can be defined clearly enough, can be made to execute “no matter what anybody wants to happen.” To paraphrase from Andreas Antonopoulos, the diffuse power inherent in these decentralized technologies is much less corruptible than centralized power. The mayor would no longer keep the keys to the city, but would be given access to them IF AND ONLY IF. You can imagine myriad things as well, I am sure. But just for fun let’s say the mayor gets to use the mayoral limousine IF AND ONLY IF his klout score is above 80, his budget is in the black for the year, and 3 or more proof-of-existence photos of him playing with children in the park have been uploaded to the town webpage during the last 30 days. (A bit silly of a set of definitions, for sure, but that’s what the citizens of Ogdenville decided on!)

This is the world that you and I and our community members can build, leaving the oligarchs out of it. We will not wrest control from the power elites; we will innovate around them (without their permission). This is the future of bitcoin-secured smart contracts and cryptographic governance that I envision.

Take a look at a few noteworthy projects already up-and-coming in this space:

Counterparty is a platform for free and open financial tools on the Bitcoin network. Counterparty tokens can be used for a wide range of purposes and act as their own cryptocurrency, while still running on the Bitcoin blockchain. Unlike ordinary bitcoin, custom tokens can be used to issue dividends, confer voting rights, as electronic tickets, access to content, and more. Counterparty offers multisignature wallet addresses, which require signatures from more than one Bitcoin private key in order to spend their funds, allowing for flexible consensus-building systems to be built.

Ethereum calls itself a “platform for decentralized applications” and promises to make writing smart-contracts simple and efficient. One such fascinating project to emerge from the Ethereum-sphere is Augur, a “fully-decentralized, open-source prediction market platform, intended to revolutionize forecasting, decision making, and the manner in which information consensus is collected and aggregated”. Read more about Augur at augur.net. Etherparty is an intriguing user-friendly platform written using Ethereum to make writing smart-contracts easy for non-programmers.

Blockstream is another project and future platform with similar goals to Counterparty and Ethereum: Making smart-contracts and digital asset management easy and secure. They plan to use a feature of Bitcoin called sidechains to create two-way pegs between bitcoin and other assets or tokens. These assets and tokens in the sidechain can be comprised of anything: digital ballots, contracts, representations of other real-world currencies, the sky is the limit. The main-selling point with Blockstream is the tie-in with Bitcoin’s superior network hashing power — something that makes Bitcoin prohibitively expensive to attack.

Colored Coins and the Open Asset Protocol is another protocol for tying assets and digital keys to a subset of bitcoin to be transacted over the Bitcoin network. Applications include companies issuing shares in the form of ‘colored coins’, which could then be traded frictionlessly through the Bitcoin infrastructure. Also, a bank could issue colored coins backed by a cash reserve. People could then withdraw and deposit money in colored coins, and trade those, or use them to pay for goods and services. The Blockchain becomes a system allowing us to transact not only in Bitcoin, but in any currency by linking it to a set of colored coins. Additionally, locks on cars or houses could be associated with a particular type of colored coins. The door would only open when presented with a wallet containing that specific coin. This protocol is already being utilized by NASDAQ to “expand and enhance the equity management capabilities offered by its Nasdaq Private Market platform”. This will allow for greater efficiency in the issuance, transfer, and management of private company securities within the Nasdaq ecosystem.

Other noteworthy projects include:

Lighthouse for decentralized crowdfunding (think: uncensorable, distributed community project donation pages), Open Bazaar for decentralized online marketplaces (think: uncensorable, distributed farmer’s markets), Maidsafe and Storj for secure P2P information storage (think: Dropbox but no one can spy on you or take down your data; it is distributed in encrypted shards and spread throughout the internet), and BitLendingClub and BTCjam for microloans to/from anyone anywhere in the world.

The future is looking pretty bright all of a sudden. But it is incumbent upon us — particularly those of us with the skills and resources available — to help build out these systems and make it happen. We need to maintain and improve upon our already-powerful open-source, cryptographic algorithms. We need to fight to encode privacy and our god-given human rights into the very fabric of the world. Edward Snowden said so himself. It is actually part of what spurred him on in divulging the crimes of the NSA and other government agencies:

“While I pray that public awareness and debate will lead to reform, bear in mind that the policies of men change in time, and even the Constitution is subverted when the appetites of power demand it. In words from history: Let us speak no more of faith in man, but bind him down from mischief by the chains of cryptography.” [From Glenn Greenwald’s new book, No Place to Hide: Edward Snowden, the NSA, and the U.S. Surveillance State]

Snowden’s goal for us is to create a more free and equal internet. In an earlier interview with Laura Pointras, Snowden explained:

“The shock of this initial period [after the first revelations] will provide the support needed to build a more equal internet, but this will not work to the advantage of the average person unless science outpaces law. By understanding the mechanisms through which our privacy is violated, we can win here. We can guarantee for all people equal protection against unreasonable search through universal laws, but only if the technical community is willing to face the threat and commit to implementing over-engineered solutions. In the end, we must enforce a principle whereby the only way the powerful may enjoy privacy is when it is the same kind shared by the ordinary: one enforced by the laws of nature, rather than the policies of man.”

By implementing these new cryptographic systems, we may move one step further towards what Snowden envisioned: distributed and secure math-based ecosystems that enhance our privacy and allow us to innovate further in all areas — in government, in finance, in communications and journalism, etc. Even if you inherently trust our government — kudos to you for reading this far, by the way — I would argue that the price of non-action here is great: Dictators around the world, future corrupt leaders of America, they all stand to benefit if citizens are denied these tools.

Another of my idols in this space is singer/songwriter/activist Tatiana Moroz, creator of the song, “The Bitcoin Jingle” (see further below). She speaks about the importance of these new kinds of projects in liberating us. In her talk just below, she describes her journey of hope and betrayal, a tale of a loss of innocence, a growing political cynicism. She fell first for presidential candidate Dennis Kuchinich, and then later for candidate Ron Paul, only to be disappointed at their negligible impact (some would say the negligible impact they were allowed to have) in American politics. She later learned about how the Federal Reserve controls and fuels the political machine under which we suffer. But then she found a new source of hope and light in the currency and technology platform known as Bitcoin.

Although I enjoy her talk immensely, concerning the creation of the first pro-artist digital currency, Tatiana Coin — amongst other innovations and insights she shares — it’s not strictly necessary to watch till the end. [Jump to the 19:00 minute mark for the meat of the discussion on smart contracts.] I think you get it. I think you see that people are talking. People like Tatiana, Andreas, and Edward are fired up — and they want you to join in the fight. Greater transparency in government, a reigning in of corruption, proper implementation of secure protocols, the funding of important projects, the re-installation of our civil rights, and perhaps most importantly: the fueling of people’s curiosity and desire to experiment, to live in a wondrous and endlessly-fascinating world. That is their call. And that is the promise of smart contracts and cryptographic governance.

The Bitcoin Jingle, by Tatiana Moroz

SOURCES:

1. Gilens and Page, “Testing Theories of American Politics: Elites, Interest Groups, and Average Citizens,” Perspective on Politics, 2014. http://scholar.princeton.edu/sites/default/files/mgilens/files/gilens_and_page_2014_-testing_theories_of_american_politics.doc.pdf

2. Washington Post, “Rich People Rule!” 2014.

http://www.washingtonpost.com/blogs/monkey-cage/wp/2014/04/08/rich-people-rule/

3. Washington Post, “Once again, U.S. has most expensive, least effective health care system in survey,” 2014.

http://www.washingtonpost.com/news/to-your-health/wp/2014/06/16/once-again-u-s-has-most-expensive-least-effective-health-care-system-in-survey/

4. Forbes Opinion, “The tax code is a hopeless complex, economy-suffocating mess,” 2013.

http://www.forbes.com/sites/billfrenzel/2013/04/04/the-tax-code-is-a-hopeless-complex-economy-suffocating-mess/

5. CNN, “Americans pay more for slower Internet,” 2014.

http://money.cnn.com/2014/10/31/technology/internet-speeds/

6. The Atlantic, “American schools vs. the world: expensive, unequal, bad at math,” 2013.

http://www.theatlantic.com/education/archive/2013/12/american-schools-vs-the-world-expensive-unequal-bad-at-math/281983/

7. Sunlight Foundation, “Fixed Fortunes: Biggest corporate political interests spend billions, get trillions,” 2014.

http://sunlightfoundation.com/blog/2014/11/17/fixed-fortunes-biggest-corporate-political-interests-spend-billions-get-trillions/