Bitcoin Forum

Quite often I read naive posts on this forum like this:

Revolution!!!  (Thanks for the summary, molecular ;) )

Please be aware: Bitcoin will NOT solve all problems in the world.

* Bitcoin will make rich people richer.
The establishment is always looking for investment options and they don't mind loosing a couple thousand bucks. Besides some early adopters Bitcoin will mostly make rich people richer as only they can do high risk investments. The advantage of this is that they will also lobby governments and banks.

* In a Bitcoin world there will still be banks.
Might be split key bitcoin-banks but still. A lot of normal people do not like to temper with codes, keys and paper wallets and the possibility of their coins stolen by hackers from their computer.

* Governments will always find ways to milk you.
You think hey, no more inflation. They will come up with some kind of creative new tax so that you will en up paying even more.


If bitcoin will make things more transparent and thus pave the road for political solutions I for my part will be happy.

Political and solutions together? I dont really understand this concept. Is this like unicorns?

I have a vision of a bitcoin based digital unicorn. But that's another topic.

Bitcoin will create rich people but it will be different rich people from those that are currently rich. This has happend with every disruptive technology for centuries.
Bitcoin will bring many opportunites to the world's poor. Why becasue they will no longer need a credit or debit card and / or a merchant account to participate in the worldwide Internet economy

Wise people don't oppose banks per se, they oppose the current banking system (central banks cartels, inflation etc). In a "Bitcoin world", where opening a "bank account" is as easy as opening an e-mail one, we would definitely not have the same system.


If the volume of taxed money is the same, I'm not aware of any worse way to tax than via inflation directed to the credit market. Any other taxation scheme ever created is economically less destructive than inflation. Basically, even if they keep milking us just as much, the way they milk does make a significant difference. All these brutal economic cycles which destroy so much capital, for instance, would not occur if it weren't for inflation directed to credit.
Plus, another quite destructive taxation type is that which attacks savings and investments, since these are the fuel for future economic growth. Income taxes attack savings and investments. Some argue that a world in which cryptocurrencies are the norm would render income taxation unpractical: http://falkvinge.net/2011/05/19/the-information-policy-case-for-flat-tax-and-basic-income/

Bitcoin will give everyone more control and options with their money, poor or rich. This makes life better and is a good thing.  ;)

I would say there will be some change mostly among rich people from conservative towards technologically open people.

they will also need coins  :P

agreed. It will bring plenty of advantages. Hard money for small countries, without having to worry about local speculation or rip of from the issuer (currently the usa is doing this job I think). But there are enough problems it will not solve and some people only think of rainbows.

no, we will have mining cartels that create a union to increase tx fees.

Hmm... I can imagine a world free of all this debt pressure. The change will be hard, though. Thanks for the article, will take a look.

And unicorns for everybody. Hope you are right.

Ever thought about a totalitarian Bitcoin world? At birth you get an address hashed from your DNA. If you ever send money to an address that is not ok in the eye of the state you will be punished.

I agree with all those statements. phelix's and molecular's .

Bitcoin will not purchase happiness for the man who has no concept of what he wants; bitcoin will not give him a code of values, if he's evaded the knowledge of what to value, and it will not provide him with a purpose, if he's evaded the choice of what to seek. Bitcoin will not buy intelligence for the fool, or admiration for the coward, or respect for the incompetent. The man who attempts to purchase the brains of his superiors to serve him, with his bitcoin replacing his judgment, ends up by becoming the victim of his inferiors. The men of intelligence desert him, but the cheats and the frauds come flocking to him, drawn by a law which he has not discovered: that no man may be smaller than his bitcoin.


Only the man who does not need it, is fit to inherit wealth – the man who would make his own fortune no matter where he started. If an heir is equal to his bitcoin, it serves him; if not, it destroys him. But you look on and you cry that bitcoin corrupted him. Did it? Or did he corrupt his bitcoin? Do not envy a worthless heir; his wealth is not yours and you would have done no better with it. Do not think that it should have been distributed among you; loading the world with fifty parasites instead of one would not bring back the dead virtue which was the fortune. Bitcoin is a living power that dies without its root. Bitcoin will not serve that mind that cannot match it.


When money ceases to be the tool by which men deal with one another, then men become the tools of men. Blood, whips and guns – or bitcoins. Take your choice – there is no other – and your time is running out.

Sounds good. Like a bright future. That is where we want to go.

+1

Have to disagree with you there. Those with well-established wealth are incredibly risk averse; they have quite a lot to lose, after all. There's a reason bitcoiners are mostly young and lower/middle class-- they can afford to start over, because they don't have far to fall.

Das sind ja Töne.  :D

I'd also tend to say that Bitcoin tech is an equalizer, just like the internet. Sure, the rich have more internet than the poor, but it gives the poor much more possibilities and chances. Also, Bitcoin may set resources free for those in the first world who genuinely want to help (by not making the third world dependent on Monsanto).

Oh but it's going to be different! Why? Because bitcoin is a different kind of money (money based on a scarce commodity as opposed to fiat money that can be printed up).

Yes, there will be rich people and some of them will get richer (the ones who make the right choices). But some of the will get poorer (because they make the wrong choices). This is good. Money isn't fair: if it was fairly redistributed every month evenly to every person on earth there would hardly be any incentive to acquire more.

Here is some of the things that will be different when bitcoin become "the one world currency" (sounds bad because of the connotations, but really isn't):

• Governments (if they still exist) will have to get by with the taxes they collect (there's a limit to that). They could theoretically borrow money, but there would be no lenders, at least not to such extent as nowadays. This is a positive difference because then politicians have to actually do their work and try to act in favor of the people (no handouts possible without taking from other parts of the population)
• Governments will be forced to downscale
• People/Companies/Systems making the wrong choices will fail (no bailouts)
• Free markets will thrive. No distorted/false price signals will make the participants blind. No misallocations of capital will effect actions that are not really desired.
  
• The economy will be much more efficient (regarding both the usage of natural and human resources (wear and tear) and the fullfillment of the participants (consumers) needs and wants. People would be happier and humanity would be less destructive towards live on earth.
• There will be less wars.
• Entry to markets will be easier (less protectionism), big corporations will downscale (sell unprofitable parts), lively innovative markets with small and mid-sized companies will be the norm (no monopolies or regulatory capture)
  
• Simple "saving" will be a possible solution to ensure ones well-being after worklife
• The world will be a fairer place.

Now, these points are debatable and I couldn't possible reason them all here and now, but I think you can tell that I am of the opinion that the kind of money we use has immense impact. If you don't think so, I'd like to discuss that.

So yes: there will be rich people, there will be banks, there might be governments... but all of them will have to wake up to a new reality. A reality that in the end is better for all except maybe a few, a bunch I naively call "the assholes". And no, money doesn't solve problems, people do. The kind of monetary system they use can greatly influence their ability to do so effectively.

I've felt from early on that Bitcoin is even more amenable to allowing for exploitation than even gold.  And both much more so than fiat.

I've also felt that the barrier to 'the masses' abandoning a solution which is significantly exploitative is much less with something like Bitcoin which cannot be hidden in some hole like gold.  Thus, for those who manage to obtain the reins of power under a crypto-currancy solution such as Bitcoin will be forced to either use their power with some moderation or stand a very real chance of losing it.  That, to me, is the real magic of Bitcoin.

But not to buy bitcoins. Loosing a couple thousand bucks is not a risk for rich people but playing.

;)    You can not speculate on the price of the internet, though.   Things might equal out but it will be a long time.


Oh but it's going to be different! Why? Because bitcoin is a different kind of money (money based on a scarce commodity as opposed to fiat money that can be printed up).

Yes, there will be rich people and some of them will get richer (the ones who make the right choices). But some of the will get poorer (because they make the wrong choices). This is good. Money isn't fair: if it was fairly redistributed every month evenly to every person on earth there would hardly be any incentive to acquire more.
[/quote]
limited redistribution is an interest of rich people, too. keep the balance, keep the 99% off the streets.


agreed, probably more transparent taxation

hopefully, but not guaranteed. maybe 33% automatically deducted VAT turns out very effective

what would be different from now?
there can be just as many subsidies as today.

In the transition there might even be more war. I guess that by far the most Bitcoins are in the US. Some people might not like that.

rainbows and unicorns

I fully agree that Bitcoin/cryptocurrencies will probably have a positive impact in the long run.

But there will still be problems in the world, plenty of them even caused by Bitcoin.


? seems pretty easy to hide bitcoins in a hole.


You mean all or nothing politically? Either a totalitarian or a small state enlightened society? Sounds reasonable to me.

There is no realistic direct replacement for gold, for instance.  OTOH, a clone of Bitcoin is mainly indistinguishable from the 'original' once a blockchain is reasonably developed.  Except that some more inflation is possible, the shit-heads who hold value in the abandoned chain are SOL, and whatever secret keys they buried in a hole are as worthless.  So, the take-away for the owners of a dominant crypto-currency would be don't be shit-heads...distribute the wealth or the masses will do it for you.

Now do you see my point better?

Maybe I should note: the last sentence in my post above was not meant sarcastic.

About gold.....  why don't you buy some Rhenium (there is 5x less in the Earth crust but it is currently 15x cheaper than gold) and make it the new gold?

Gold gets its value only by tradition and so might bitcoin.

I'm afraid you've been misinformed. The wealthy are not risk-averse at all. Sure the core money (often in trusts or invested by near-blind portfolio managers) will be boringly held, but at the edges they have play money that they enjoy gambling. They could happily drop 50k on a party or maybe a bitcoin punt just for the chance to look clever later. IMO its the first sightings of some of these that are fuelling the current rise

Operationally, a switch from gold to rhenium (to use one of the few vaguely theoretically possible alternates) would be a significant undertaking.  Mining, processing, minting, distribution, etc.  A crypto-currency, OTOH, could achieve a much more satisfactory drop-in replacement solution with an effort of one man-evening of hacking in his den.

That said, I am sure that there is some element of 'tradition' in Bitcoin and other crypto-currencies, and it is a big question mark in my mind as to how much of a factor that will be in practice as we move forward.

yeah but the special ones, you know the ones that pee strawberry juice and have long flowing rainbow manes.

it certainly may bring happiness, and code of values come out of thermodynamics

you start in a deep well that others dug before you were alive and you were born in the well. You have no climbing tools of any kind, or digging, the owners/people at the top of the well drop scraps of food down to you and sometimes water, but really don't care except that when they throw down documents for you to process/write (white collar) and things to assemble (blue collar) these jobs are done. These products are hoisted up in a bucket connected by razorwire so you will never be able to climb it and anyway its not strong. They only keep you alive when you make them profit, this may mean sometimes they drop medications down to you but these are mainly anti depressants so you can feel better about your true situation. They may offer 1/10000000 well people a lotto ticket out, but only do this by making you return more work or eat less for that lotto ticket, so it not really an out it was a regressive tax. But it gave you [false] hope

Can you not see It does not matter how smart, hard working, enthusiastic, kind, optimistic or lucky you are, you are structurally you are still and always will be in the well, with no way out ever.

So keep believing hard work and smarts will get you there, it wont.

Bitcoin will certainly be the currency of future "internet states/country"

The way they 'milk' makes a massive difference.  I don't see this being a painless transition, especially to the mainly poor who believe they should pay their 'fair share' of taxes whilst the smarter and those who pay the smarter take more and more income and wealth out of reach of the taxman.  However I see governments being forced to totally rethink their income (and their expenditure) as inevitable eventually.

People propose flat tax or high VAT as alternatives but both are still taxes on the productive and both are among the taxes that become more difficult to impossible with the rise of anonymous currency.

Tax on land on the other hand does not.  Governments can, and should, give up on trying to keep tabs on how much people earn and how much wealth they own.  Tax on land is taxation without 'milking'!  Taxation as a rent on the increase in land value that is as a consequence of others' efforts (businesses, workers and 'public works' such as infrastructure) is not only not negative, it has a positive impact by ensuring land is used more effectively.

I happen to think Land Value Tax is part of a family of solutions that includes and goes hand in hand with Bitcoin.  But regardless of whether it is or not the eventual solution the fact that taxation via inflation will be impossible whilst taxation on wealth, on income and on sales will be very difficult will push the conversation towards better solutions.

Unfortunately VAT on goods is almost impossible to avoid, in spite of having or not a way to spy on people's finances. Merchants have a strong incentive to declare it in order to reimburse the VAT they payed on input.

And even for VAT on services, some nasty techniques may considerably reduce evasion, like forcing merchants to allow customers to provide their fiscal number to be attached to the "fiscal receipt" (what's the correct English term?), and then reimburse these customers of a % of the VAT they payed. The government of the state of São Paulo is doing this right now. You may get back as much as 30% of all the VAT (there called ICMS) that you pay. As the default VAT percentage is 18%, it means by default you can get back ~5,4% of the price of everything you buy just by adding your fiscal number to the receipt. It's not a negligible amount, so most people do give their numbers. As a consequence, the state avoids a significant amount of tax evasion and also happens to gather an immense amount of financial data about its subjects. Total Big Brother, and would work quite well even in a cryptocurrency world.


Land tax creates price distortions. Why land should be rendered less useful to hold, relative to other goods? Interfering with market prices is never a good thing.
(of course that every tax does such interference, but a general flat VAT affects all consumption equally, so the distortion effects are less bad)

Governments are evil, violent mafias. When people stop believing it's virtuous to point guns at their neighbors to get what they want governments will be extinct.

Well, either they will cease to be evil violent mafias or they will cease to exist.  Time alone will tell.

So far, it is still an experiment, both technically and politically

Centralization is the natural end of any profit driven system, so how to limit the centralization tendency is the core question

At the begining, when resource is aboundant, bitcoin is quite distributed, this might be the best time, but that period is almost coming to an end, mining operations will be more and more specialized and centralized to several large pool, bandwidth and storage limitation will put most of people out of the mining, and satoshi dice like automated trading bots will abuse most of the transaction capacity...

Same thing. Without the coercion they aren't governments any more. We have other words for organizations which do the same job without the violence, like "charity", "insurance companies", "business", etc.

I don't believe it does 'distort' the market when it comes to land.  I agree with the principle of not interfering with markets relating to capital and labour because yes, it does distort prices making it an uneven and unjust playing field.  But the reason people mostly apply the same to land is because neo-cons and ancaps tend to bundle capital with land and call them both capital.  But classic economics differentiates between land, capital and labour, recognising land to be a special case.

At the risk of derailing this thread (I could go on about LVT till the cows come home - as I have over in the politics subforum) it is the fact of landowners reaping the benefits of the increase in value of their land as a consequence of the combined efforts of others that distorts and creates injustices.  LVT or other forms of GeoLibertarianism or Georgism look at means of minimising or eradicating those distortions.

As for VAT I can see what you're saying about sales tax being a much easier one to monitor and enforce than income or wealth taxes.  However it is still a tax on the productive and is still prone to a certain extent to avoidance whereas land tax simply isn't.  I own the land, I have title to it there is no argument.  It can not be hidden.  My land is valued the same as that of my neighbours and that's how their and my 'location levy' (a term I prefer) is determined.

You ask why should [holding] land be rendered less useful than other goods?  Because it is!  Well actually it is worse than 'less useful'; it is harmful.  Comparison with Bitcoin makes the essential difference easiest to see.  In common, hoarding Bitcoin and hoarding land both mean less is available for everyone else.  But regardless of how little Bitcoin is left it is just as useful for newcomers to use for trade, for international transfer or for hoarding.  It doesn't matter how much you scale it essentially it still works.  You try getting the same crop out of, or building the same house on a plot that is 0.00001 the size of what an 'early adopter' bought for the same price!

I'm still not convinced by the idea of competing law enforcement agencies etc. that I've seen anarchists argue for.  I would prefer police, armed forces and justice system to remain under one agency.  I would call that a government regardless of whether they are 'evil violent mafias' or not.  I understand purist anarchists say unless you're allowed to raise your own army you are 'oppressed' and the regime preventing you are therefore oppressive and evil.  I'm not saying they're wrong.  I just don't agree.

Do you, either in person or via a proxy, have the right to threaten other people with violence for disagreeing with you?

I fully support your right to fund any organization you want to fund with your own money, and to refrain from funding any organization you disagree with. Will you grant me the same consideration?

I think centralisation is certainly part of the cycle, part of the picture but in the examples I'm thinking of if centralisation becomes excessive it get's lazy then competition springs up and shakes things up again :)

I think those who believe centralisation as an inevitable consequence of profit will tend to filter out signs that what is happening doesn't conform to that picture.

Let's look at mining first:

If ASIC mining gear generally keeps the same price per hash regardless of the scale of purchase (which is essentially where it is at at the moment) there is no economies of scale that will drive out the hobby ASIC miner.  And if the growth of the bitcoin user network is growing exponentially the proportion of those deciding to mine needs to decrease by even more for the distribution of mining to decrease - and I just don't see it.

As for the pools I think we're all aware of the dangers of some pools having too much power and it is simple enough to use another means, not least p2p, to mitigate those problems. I will not comment on the transaction capacity issue with SD and dice because I don't understand the technical issues nor proposed solutions well enough to form an informed judgement.

Lexically government does not imply coercion (although I fully empathise with those that think otherwise).

In theory one could build a governing system that is P2P and fair (of course people unable to own a node would not have a voice).

But the problem would arise of peers grouping together "offgrid", talking etc., forming subroups that work on coerceing other peers into voting a certain way, larger groups could control the media etc. So in effect the government system escapes its mathematically perfect existence in the network and spills out into individual minds and we are back to square one; a pyramid heirachy emerges and eventually dominates, again enforcing laws chosen by those higher up.

Bitcoin itself has no defenses against this behaviour either. Business intrinsic to BTC is mining and transaction processing (and loans), in time mining/transacting will be carried out by a diminishing number of mega-nodes (eventually 1) as that configuration is the optimal solution both energy and hardware wise. This optimal solution is inevitable in a competitive market, and so the chance for corruption increases over time.

When you consider the above; the concept of a Borglike hive mind kind of makes sense (unless you're near the top of the existing pyramid). Should a hive mind arise in humans I think it would be favoured by evolution and we would be exploring the galaxy sooner. Also I dont think a borg mind has to be grey and unfeeling as portrayed on startrek, maybe it would be wonderful?

I like having this asked me because it is not one I can answer as cleanly and as certainly as I would like to so it makes me think!  I think if we had a clean slate, say a bundle of us found ourselves on a previously uninhabited piece of land, I would not feel I had the right to be part of the establishing an organisation that would prevent others from doing anything other than abusing others.  And if we ended up with more than one competing organisation doing crime prevention/justice I really don't know - but I can see problems.

But I'm guessing neither of us are in that position!  I guess we both live in lands that are currently governed.  Now if we stripped these governments' powers back to the extent that we both agree and strip their funding back to the extent we both agree I know we still have not gone as far as you want but we still have one government.  In this situation if a bundle of people (or one very rich person) decided they wanted to fund an army or a police force and do justice their way and for the sake of argument, at the risk of offending muslims out there, they decided the law they considered to be just was sharia law, would I trust them to respect the rights of suspects or to treat believers and non-believers with equal respect?  Mmm.  I think I would prefer to support the government in saying, "No you can't have your army" which of course means being prepared to prevent the army from being formed by force.  So I don't know if I would go as far as saying I have a 'right via proxy to threaten' but I think I would nevertheless take that step in the given circumstance.

I will give you the same consideration if you want to live, trade, rent and conduct your free life without owning land.  What's more, regardless of your wealth or lack thereof, regardless of your not electing to contribute to the public purse the police, the courts and the armed forces will protect you irrespective of who you are.  However if you decide to own land you do so under the understanding that whilst any increase in value that arises out of improvements you make is yours, any increase that happens as a consequence of others' efforts will not by right be yours and you will therefore be obliged to pay rent on it.

Please note I am not saying I have 'THE ANSWER' but i think I have AN answer that is a world away and is more just by orders of magnitude than what exists today.  I suspect by the time we got to having stripped away the powers and funding to the extent that we both would agree the differences in the connotations and likely outcomes of the remaining options would become clearer and I doubt very much we would come to blows over it!

It's not a matter of belief, it's a fact. Market prices are those determined by voluntary transactions. Taxes are coercive, not voluntary. Any alteration taxes provoke on prices is a distortion of the actual market prices. And taxing only a particular kind of good (land), provokes an unbalanced distortion.


Land can certainly be capital if used as such, capital == means of production. The land of a farmer, for ex., is part of his means of production. So it's his capital.
But whether it's capital or not is not my point, my point is that by taxing land only you'll create a burden on only this kind of good.


There are many problems with Georgism. Both on the ethical and on the practical/economical level. I'm aware that both Hoppe and Rothbard have written about it, you should perhaps search their essays.


It's a tax on consumption. That's the last link in the economic growth chain. Attacking that link will not break the chain thus will not seriously reduce future economic growth. It will reduce the amount of growth that people can profit from (consume), but the growth speed won't be be seriously reduced, at least not if we compare with taxes which affect savings and investments.


The usefulness of something to society is not to be determined by you nor anybody else. You don't get to say that land is more or less useful than other goods. That's something to be decided by people's actions and their subjective evaluations.

But you can certainly anticipate that it will be artificially rendered relatively less useful than other goods if you apply a tax on it.

Interesting discussion ;D

I sometimes think that anarchy is like disrupting a bottle of soapy water, the bigger bubbles would be burst and we would have more foam, yes it would be fairer initially, wealth and decision making would be more evenly distributed. But alas over time one dominant bubble would again form, and then what... I guess shake again and repeat. But what if a chemical were introduced to the water to prevent bubbles? A technological singularity might be what it takes? And then we can evolve to the next fractal level, becoming an individual collective as we enter the cosmos in fantastic ships. Now I'll leave you two to it... :D

So you do believe in using force to get what you want from people who disagree with you.

Thank you for pulling me up on this.  As I wrote it it didn't feel quite right.  You are correct in that if we consider market prices as determined by voluntary transactions to be the determinant of price then anything else does by definition 'distort' it.

And of course the terminology you use to say 'coercion provokes an unbalanced distortion' makes that look like a terrible thing - as it is I believe when applied to productive and consumptive activities.  Although I can see the 'end-of-chain' argument making VAT in a way maybe the one that affects productive activities least it is still hindering the beneficial cycle of commerce.

Taxing land simply doesn't.  To the contrary.

Ah, OK I had forgotten ancaps tend to go one further than the neo-cons and mush all the various elements that make up the means of production and call it all capital!  Of course then you can take rules that normally apply to capital and apply them also to what others might call land or labour.  Classic economics finds it useful to recognise essential differences between the elements that make up the means of production.  Smith talks in terms of ' labour, land, and capital' (http://en.wikipedia.org/wiki/Classical_economics) and the Wikipedia 'Factors of production' (http://en.wikipedia.org/wiki/Factors_of_production) also refer to the three as being distinct.

If we don't mush up the terms into one we can say the land of the farmer is, along with his capital and his labour, his means of production.  The three certainly have many attributes in common but one of the beauties of not mushing them together is that it also gives us the freedom to see what is different about each.

But it is only by bundling land under capital that you can then further classify it as a 'good' which it isn't if we're recognising the fundamental differences that caused it to be considered separate from capital in the first place.  Labour isn't a 'good' neither is land - only things in the Capital classification are 'goods'.

My subjective evaluation is not that 'land is more useful than other goods' but that it is not a 'good' and that its distinct attributes means it can be treated differently to 'goods'.

People's actions and their subjective evaluations will determine how much someone is prepared to pay for a property.  If there is a tax to be paid this will eradicate any increase in future value arising from its location so the amount someone is prepared to pay will be less - there will no longer be a virtually guaranteed appreciation in value due to demand in that location.  Call it a distortion if you like but it means the considerations in evaluating the property are now limited to its productive capacity and/or desirable features.  From my perspective it has taken out the 'distortion' in price caused by speculation.

Land is of limited supply.  The degree by which its value increases (other than by direct improvement by the owner) is determined by demand which is determined by its location - and the difference in price between various locations is a consequence of all economic activity and amenities in those locations.  Everybody who makes a positive contribution to commerce and amenities in one location has contributed to the increase in value of the land.  If it so happened that the proportion of contribution matched the proportion of the land owned then it would be easy and fair.  But it isn't.  Landowners in the absence of a land tax reap the benefit of the work of others - and by looking at it through the eyes of current economic paradigms actually believe they have 'earned' the increase in value.  In the meantime the next generation and newcomers have less and less of a chance of finding somewhere to live they can afford - whether to rent or to buy - because as illustrated by my Bitcoin comparison earlier, hoarding land with virtually no risk of it going down in value (providing others keep up the good work) keeps swathes of land under-utilised.

If that's how you insist on seeing it nothing I can say will change your mind.  You didn't even put it as a question but as a statement.  I happen to think as I said earlier that we have a lot more in common than we disagree on.  If you will stand beside me for most of this 'fight' towards shared values I believe the odds are we'll be able to work out the differences when most of the goals have been attained.  But you're also free to see me as a gun-touting scoundrel who would help myself to anything that is yours if that's your preference  ;D

I don't appreciate your attempts to obscure your position with smokescreens and obfuscation.

The only agreement that matters is the moral status of using force to extract compliance. If you're willing to point guns at people to make them do what you want I don't care how you dress it up. Putting mafia hitmen in three piece suits doesn't makes them less evil.

Your position on land taxes is untenable because it's not possible to apply the principle, "anyone who benefits from the actions of another person is obligated to pay" can not be universally applied.

I could come by your house in the middle of the night without your knowledge and paint the exterior for you. Now you've benefited from my work. How much money am I allowed to extract from you? What if you don't like the color I used? If I'm your neighbor and I plant a tree in my front yard, do I get to charge you for the reduction in your summer air conditioning bills due to the shade that falls on your property? How much do you get to charge me because you don't like the loss of view? Who gets to decide what unchosen obligations can be violently enforced and which ones can not?

If that's how you see what I'm doing then it would appear this exchange is over between us.

I'll thank you for prompting me to think these things through again.  As I have not been afraid to share there are aspects of the position I hold that I'm not entirely comfortable with so being challenged as I have been here is a good thing.  But it appears you and I have got to the end of the line on this one.  L8r :)

Refusing to stand against them might make you virtuous but might not be particularly effective.

Do you just allow them to do as they please?

Do you wait until they have prepared their weapons and their armies, arrayed themselves upon the battlefield of their choosing, determined the most opportune (for them) moment for battle and commenced battle before you marshal your troops? Or before you don your armour? Or before you choose which spots, that they haven't already chosen to occupy themselves, to place your troops at?

How simplistic is your military strategy / conception?

-MarkM-

Of course I do - they are the ones with the guns. Fighting them is just stupid.

I can stop worshiping them, I can call them by their proper names (http://www.goodreads.com/quotes/106313-the-beginning-of-wisdom-is-to-call-things-by-their), and I can avoid indoctrinating my contribution to the next generation into the cult of the state.

I just wanted to thank you for chipping in yucca :)  Out of leftfield but we're talking proper paradigm shifts here that have the potential to leave these older imperfect proposed solutions in the dust just as Bitcoin is doing for banking!

Apologies for coming back with more after having closed the discussion but... :)

The principle illustrated by my talk of 'increased value as a consequence of others' efforts' is only a means of illustrating the injustice of the absence of letting the landowner reap the rewards.  It is not a practical means of determining the amount of the tax payable.  That, as I understand it is done not by evaluating who is affected in which way by everybody's actions which as you point out is ridiculous.  It is done by ascertaining the value of the land as distinct from any structures or lack thereof on it.  With the statistical and technological advances since Lloyd George was advocating this at the turn of the 20th Century (influenced by George) it is possible to reasonably quickly, accurately and inexpensively to split the the market value of a property, differentiating between the value of the structure and that of the land beneath it.  It is the value of the land that gets taxed - hence Land Value Tax!

That could simply be auctioned couldn't it? Bid how much tax you are willing to pay for the use of the land...

-MarkM-

I have seen arguments by Georgists that works by some kind of permanent auctioning in that at any time someone using a piece of land may be outbid and needs to up-sticks and go elsewhere.  I will admit I have not studied it enough to understand so I can not comment.  And even though I am no expert on these matters for LVT as proposed by the Liberals in the UK I can see the auctioning concept being problematic because it is the previous land owner who is selling the property.  For a price to be agreed between buyer and seller the fact of and approximate LVT annual payment needs to be known and factored in. 

A land tax imho is problematic as it can bully people out of their homes. Taxing whenever there is a change of ownership (sale or inheritance) is enough. It achieves the same only slower.

A land tax solution does depend on a paradigm shift in that people have to accept title to land never meant absolute outright ownership in the first place.  In the UK technically all lands belong to the crown and I believe even in the republic of USA there is something similar.  The state claiming a rent on the increase in value that came about as a consequence of the efforts of others does not then seem so outrageous - especially if everyone has the option if they don't want to pay tax - to move their assets into anything else they fancy and not have to pay tax on it.  Those who believe their land is absolutely theirs including those who would amass and use an armoury to defend it will never be persuaded of the benefits of LVT.  I don't know how to address that.

Taxing only at change of ownership is not a long term solution - especially in the UK where land is handed down generation to generation amassing wealth for as long as everybody else in the community keeps working to increase the demand on land and the land owners between them only let tiny bits of it go at a time.  Inheritance tax only hits the middle class because the upper landowner class use trusts to pass title down the family without paying inheritance tax.  There are schemes talked about that would deal with the 'low-income little-old-lady in a big house in a high-demand area' scenario whereby the tax could be deferred until death or sale but this would be the exception not the rule.

Of course the consequence of people no longer holding land as an asset frees up land for those who want to use it more productively whilst at the same time freeing up the assets which, unless they just want to put it into pms or bitcoin, is more likely to be invested productively - and with the added incentive of not having to pay corporation tax or income tax, and with not having to deduct and administer employee income tax, and without having to administer and charge sales tax, makes for an immensely more productive and healthy economy.

All it requires is one 'tiny' shift in our perception on the ownership of land!

Forced change of ownership / auction every 100 years?  ;D

To get back to the original topic this was something discussed yesterday with my fellow geo-libertarians at the LibDem spring conference in Brighton...*

There are some rich folk who will, just by buying and holding Bitcoin, become richer.  However, they are likely to be only the tech-savvy rich who are prepared to spend the time studying Bitcoin and only those who are prepared to risk some of their wealth are likely to do so.

I doubt very much that a significant proportion of early adopters (even if we include today's adopters) are in the wealthiest 5% though this may change soon.  And Bitcoin would not be where it is today in terms of distribution were it not for the early adopters who did spend/invest/give away a load of their coin.  I am getting the impression from discussions on these boards (and having an idea of the source of the Bitcoin I am buying locally) that some early-amassed wealth is gradually being fed into the active Bitcoin economy.

Some of those I was talking to yesterday would ideally like to see the seignorage of a currency going to the 'commons' in the same way that land tax would.  However my argument was that this could only occur if it was a government controlled currency people were coerced to use.  With Bitcoin the cat is out of the bag.  If there are currencies that work well and don't require the government then why get governments involved at all?  Even though Hayek, Keynes and Marx all missed the significance of land in their theses I think Hayek was right on this competitive currencies.

In the narrowest sense we could say the 'seignorage' of Bitcoin is the miner's profit but personally I think they have earned it and does not belong to the 'commons'.  But the main task of distribution lies with those who own and use Bitcoin so in a way we could say the consequent increase in value to early adopters is also 'seignorage'.  I tend to think Bitcoin would not be catching on as it is were it not for that.  People might think it was a good idea but leave it until another day until others have tried it were it not for the likelihood that it will cost more tomorrow.  And if enough people did that it would have died.  I also think people would be much less likely to rave on about it to their friends and family (of course primarily extolling its virtues etc.) were they not also enjoying watching the value of their own holding relative to fiat increasing month by month.

I don't think the way the early adopters including me with my five-month involvement 'deserve' for having bought when we did and for talking about it with others and being involved, the wealth we're likely to be holding in a few short years.  Yet I think it was a necessary part of the design.  Without it widespread Bitcoin adoption would not happen I think**.  In a way the increase in value is to Bitcoin what porn was for the internet!  In the mid 90s I was tutting those who slowed the internet down with images (like people are criticising SD 'spamming' today).  I thought it was a serious tool for the future of mankind for serious discussions to dispel myth and accelerate the discovery and distribution of knowledge.  But if porn hadn't come along I really can't see the internet would have taken off as it did in the ten years that followed.  I believe that is why it ended up in most people's households.  There may have been all kinds of noble and practical reasons people gave themselves and others for getting on board but it may never have happened without that little secret excuse to do it today rather than tomorrow!  Likewise with the increase in value of Bitcoin :)

As for Bitcoin solving all problems I don't think so***  - there's the land problem for one - but it takes us a darn sight closer :)


*Yes, I know, sounds bizarre doesn't it - but it was good :)

**maybe we should thank the likes of the freicoin folks for doing a control for this experiment.  It will be interesting to see.

*** but then neither does anything else on its own.  But there may be a family of solutions...

One who didn't was Silvio Gesell (http://en.wikipedia.org/wiki/Silvio_Gesell) with his Freiwirtschaft (http://en.wikipedia.org/wiki/Freiwirtschaft) (Freigeld, Freiland, Freihandel).

this. it still is the main factor.

Freigeld is an interesting idea but it is hard to imagine it could ever work because there are always harder money alternatives.