(UR) Neoliberal capitalism. By all accounts, we’re stuck with it. For some, capitalism is the economic system tied to a free and transparent democracy. Since the 2008 economic collapse, however, the feeling is not universal. Perhaps more importantly, in the post-2008 world, even old supporters of capitalism are now seeing the relationship between economic systems and government as too entwined. An alternative to this coercive relationship between economy and democracy might very well be that invention that has often been critiqued as being the enemy of liberty itself: the BitCoin.
Analysts of the 2008 financial crisis have blamed the massive downturn of the global economy to everything frompoor government to foreign greed in investments. No matter the specifics of the examination, it has become more apparent since 2008 that the economy, currency, and government are moving ever farther out of the hands of the people.
As currency and the financial markets become increasingly detached from democratic participation, and the elected officials are apparently willing to support large, failing banks with tax dollars, it is perhaps time for an alternative.
Mathematics, rather than representative democracy, make the BitCoin a currency of an entirely different flavour. While still being rooted in a system of monetary accumulation, an article published this month on openDemocracydetails how the BitCoins’ freedom from financial institutions and sovereign states keeps it in the hands of individual users.
This “trust,” or the lack of corporate control inherent in the BitCoin, comes from the inhuman, logical nature of the algorithms that drive the cryptocurrency. Greed, desire, and a competitive nature that informs the decisions of many large financial houses to manipulate the market, or directly intervene in democratic institutions, simply do not exist with the BitCoin. Manipulation of the BitCoin market, according to Nozomi Hayase’s openDemocracyarticle, is only possible if actors manage the improbable and “compromise math.”
Corporate entities free from government oversight, which can generate wealth based on abstract speculation, are a danger to populations dependent on access to currency for their well-being. When only a small group can manipulate markets and keep the flow of capital moving in one direction, the top-down nature of the economy will inherently reduce consensus.
BitCoin inverses this top-down model and, through something called “algorithmic consensus,” creates a more horizontal relationship within the economic structure. Add to this a host of mathematical and logic-driven checks and balances, the BitCoin inherently eliminates faulty and illegal wealth generation, forgery, and other aspects that our current neoliberal capitalism encourage in our economy.
While the majority of citizens in the U.S. are not currently using BitCoin, the opportunity exists within the model to allow for rather direct democratic access to a currency for the first time ever. Despite their being an obviouslyunequal distribution of wealth within the cryptoeconomy, this is simply the result of the BitCoin being introduced into a neoliberal capitalism where economic inequality is, unfortunately, par for the course.
Inequality notwithstanding, the BitCoin and other cryptocurrencies offer users access to democracy in a way not yet seen within the broader capitalist system. And that, at the very least, is somewhere to start.
This article (How Math Could Restore Democracy and Solve Economic Inequality) is free and open source. You have permission to republish this article under a Creative Commons license with attribution to Chris “Kikila” Perrin and UndergroundReporter.org. If you spot a typo, please email the error and the name of the article to firstname.lastname@example.org. Image credit: Flickr/Jason Benjamin