Dear John,

When was the last time you thought about neoliberalism?

Neoliberalism is one of those words that academics and political hobbyists like myself like to play with. It’s a bit outdated, a bit pretentious, and we’d all like to pretend we really know what it means.

But whatever it actually is, something resembling Neoliberalism has defined the political-economic system of the world for 40 years.

I’ve been beginning to wonder whether my work in Bitcoin is fundamentally a continuation of the neoliberal project, or if it marks a completely new way forward.

The quintessential neoliberal image is of Reagan and Thatcher in the 1980s: smashing the unions, privatising and deregulating the economy and unleashing “the free market”. Soon the world would follow.

But once you start with that, the lint roller picks up everything from the Yom Kippur War and the oil shocks to https://en.wikipedia.org/wiki/Friedrich_Hayek, sheep farmers in New Zealand and Tiananmen Square.

I can’t hope to summarise the what of Neoliberalism - but broadly these market reforms have diminished the role of the classical state. In its shadow have grown powerful private sector forces and a new kind of relationship with the State. This power dynamic is honestly quite illusive to nail down.

On the surface, the government is the one with the big guns. But who sells them?

People have been enabled mobility and the ability to self-author their own lives, but many people still slip through the cracks.

The government is only supposed to be the referee for markets, except when it is actively playing the game and bailing out the banks.

Regardless of its contradictions, something called Neoliberalism happened, and my entire life has been contained within it.

I have noticed that beyond the academic world there are few people actively talking about this pervasive political-economic system that has created the world we live in today.

We just don’t talk about. What does it mean for a concept like this to be absorbed back into the bloodstream of society, to no longer be a discreet concept, but simply considered part of the organism itself?

Neoliberalism is a global system and nobody is beyond its reach. Both open and closed societies interface through the flow of goods and capital.

The long fingers of global supply chains and trade have been convenient for me. I can order something and get it on my doorstep the next day. Trade and travel opportunities have opened up. I can do all sorts of things that were just not imaginable in that old world.

Neoliberalism has also enabled a kind of unimaginable power accumulation by private individuals, with their billions allocated in immortal corporations that have more power than most actual states. Tax havens and private islands are one of the other outcomes along with inequality and cultural poverty.

But most of all, Neoliberalism tries to tell us that the riddle of history has been solved, that the answer is in free markets.

The Sovereign IndividualThe Sovereign Individual

I write these things, but on one hand I am a prototypical neoliberal person. I am a (semi!)-educated knowledge worker, I sit at the arbitrage between several jurisdictions and different markets. I work with technology and innovation. I have been enabled to travel and network and build things with a large amount of autonomy.

I see a lot of parallels in my life with The Sovereign individual: the self-authored elite entrepreneur who has the ability to shape the world and leave a mark. The archetype of Peter Thiel, Howard Roark, or Satoshi comes to mind.

I even go a bit further than the normal prescription: I have a large distrust of the State and its atrocities past and ongoing. I consider taxation to be theft. I do not think the state knows what is best for everyone (or anyone).

I run Bitcoin and privacy infrastructure, including a Lightning Node, my own Bitcoin Node, my own stack of self sovereign technology and actively read and learn about these kinds of things.

The PlebThe Pleb

On the other hand, who am I kidding - I grew up in a place that was known for two things: its sheep and its apples. I come from a place of no political or financial capital. I was a net recipient of the fruits of social democracy.

I was raised by a family and a society and a tradition around me. Where did it come from? The Ex Ovo, the image of society as an ongoing project is important to civilisation. John Gray writes in Beyond the New Right about how both Communism and fascism are one-generation ideologies - they forget the past and eventually cut off their own future.

But how different is neoliberalism, which sees the empowered individual as only an economic agent swimming in the free market at a single point in time?

I am not saying those things I inherited were good or the best, but it was what I got. My formation as an individual was in the context of a society.

One of the dog whistle of Neoliberalism is free market fundamentalism, that is “unregulated laissez-faire capitalist markets solve most economic and social problems”.

But where do those free markets come from if not the society in which they exist?

The Bitcoin Escape HatchThe Bitcoin Escape Hatch

Within these two personalities is a contradictions.

I am not a global élite. I don’t have an island or a private jet or a royal title. But I am also not some lame and mythical proletarian with zero political power.

Bitcoin is a neoliberal escape hatch. It is a black box where capital can be hidden and shunted around the world. It is (mostly) beyond the reach of the state and through Bitcoin I am indeed self-sovereign.

Is it possible that with Bitcoin (and a little bit of help from my friends) I have accidentally slipped, or perhaps ascended into the world of global capital? I don’t have a bank account in the Cayman Islands, but I have Bitcoin in cold storage.

I run self-sovereign hardware, I have met central bankers and Bitcoin developers. I even possessed the crown jewel of the modern state: the money printer (Via my own Bitcoin mining machine). I also have cultivated the learned perspective of history and money like some landed aristocracy in the royal society.

Somehow, I have managed to slip in on the coattails of the global elite from a project that was fundamentally anti-elite.

These two quotes, from the high point of Neoliberalism in the early 90s are quite telling:

We reject: kings, presidents, and voting. We believe in: rough consensus and running code.
– David D. Clark 1992

The computer can be used as a tool to liberate and protect people, rather than to control them. Unlike the world today.
– Hal Finney, 1992

In a sense I have been inducted into the UTXO Aristocracy, a house of peers open to everyone, but not everyone gets it. My ticket out of that was to learn about Bitcoin, to learn about money, to learn about these systems of power.

The inheritanceThe inheritance

So on one hand I am an inheritor of a legacy of democracy, of freedom of speech, of social democracy, the imagined community of New Zealand and the Commonwealth, of the Western & Christian Tradition.

On the other hand, I also inherited this neoliberal project. Neoliberalism tends to think those other things don’t matter. For them, the earth is flat and culture and society don’t matter as long as we have a free market.

There is no such thing as society. There are individual men and women and there are families.
– Margaret Thatcher

But the more I go into it, the more I realise just how deeply the neoliberal word games have come into Bitcoin.

I have noticed in the Bitcoin discourse there is an emphasis on free markets, Austrian economics, Praxeology (which my spell checker wants to correct to proctology), deregulation, and a disdain for the state.

Neoliberals and Bitcoiners to me both seem to be technologists. There is a kind of immanence or determinism where everything and everyone is framed as quantities and numbers and systems.

The neoliberal theory of technological change (…) becomes a fetish belief: that there is a technological fix for each and every problem.
– David Harvey, A Brief History of Neoliberalism

“The market fixes that” is seen as an eternal truth. I might have seen it on a T-Shirt even at a Bitcoin conference once. But where did that idea come from? Is it really true for all time and places? Why are Bitcoiners saying that?

I find it fascinating that these echo almost exactly the same political ideas that fed the original Neoliberal thinkers.

You know how powerful and transformative the idea of Bitcoin has been to me. But when I see people repeat the kind of simple slogan that could be spray painted on a protest sign I know that we need to ask more questions.

Both the Bitcoiners and the neoliberal theory (less than the actual practice) have developed their own mental gymnastics of “If only we could all contract together”, or require us to assume some kind of Hobbesian starting conditions to make an economic point, like “How would the economy form if we were on a desert island”.

The neoliberals raise free market up as the ultimate form of human institution, but they fail to recognise that all human institutions are imperfect.

We cannot make better humans, and we cannot perfect human systems - but we can talk it through.

I think all we can say is that reality is messy, that we are social animals, not technological entities. The role of conversation, engagement, and voice are important to developing the shared culture and tradition that then enables markets and prosperity on top of it.

In short: I think free markets are important, but I don’t think civilisation and society come from free markets. I think it is the other way around.

Keep asking the questionsKeep asking the questions

I cannot finish my study of political economy here. As I continue down the rabbit hole I begin to question some of the things I passed on the way down.

I know it is important to read the other side. In my study of Neoliberalism I have done the whole spectrum from overtly Marxist texts that emphasise the story of Labour and unions before the 1970s, to conservative texts, to texts explicitly from the Right (such as The Sovereign Individual).

I think it is essential to read all sides, to frame it all as questions and perspectives. It is not about convincing you or me of something like it is a blunt instrument, but to present how others see it and have that conversation.

Neoliberalism happened, Bitcoin happened.

We are here and now and navigating what is fundamentally a social project. The code is what it is, but how do we use it? The escape hatch of Bitcoin is powerful, but that same escape hatch exists in neoliberalism and has led to this crazy world we live in.

What is the role of social processes, of deliberation, democracy, of civic society?

What is coming for us in this brave new world of whatever happens next?

I have only got more questions, but I hope we can continue the conversation.

Importantly, I hope we can do something cool with our computers.

– Cody

P.S. I recently interviewed Roger Huang to try and talk through Neoliberalism. We touch on some of these ideas and more.