Bitcoin split into two different currencies today. I don’t really understand why except vaguely something about the software being too overloaded and needing to be either upgraded or split to lighten the transaction burden on the network. Or something like that.
There was something amazing about the bitcoin split that isn’t being reported by anyone. That is, no government was involved in the decision to split the currency into two. There were no squabbles, no politicking, no building coalitions, nobody forcing anything on anybody. The guys who hold up the bitcoin network, they simply came to an amicable decision to split up, and social justice warriors were not even involved.
And what happened to the bitcoin price? Nothing much at all. It was fine. The people who use it are fine. The people who buy it and sell it are fine. Everything is fine.
Whenever I suggest privatizing something – roads, courts, airport security, garbage disposal, the water supply, etc. – I am invariably asked how the private sector could possibly handle X. Well, this is how the private sector would handle a money dispute. Amicably, cleanly, efficiently, and quietly. So we can all live our own lives.
Beyond all the thing things I want to privatize, first and foremost and my utmost priority, is to privatize money creation. Let the government have the shekel if they want. Manage it however they want. Print it, don’t print it, I don’t care. Just let the private sector produce its own money and allow people to use whatever money to pay their taxes at market value.
Why is this my top priority? Because the Israeli government is the source of 99% of all problems in Israel. From the Temple Mount and the government-funded police who beat and tazer defenseless Jews on Tisha B’Av to skyrocketing real estate prices to the war with the Arabs and Oslo, it’s all their fault. All of it.
Government power needs to hacked away and the single greatest power – the source of all the other powers the Israeli government has is the ability to print money that we are all forced to use. The monetary monopoly is the seat of all of its power. Break the State’s monopoly on money, and you have hit the weak spot at the center of the Death Star. You break the State’s biggest power monopoly by far. Once money is privatized, the State can no longer inflate with impunity because the shekel would deteriorate fast. The government in an environment with monetary competitors, must either shrink fast or go bankrupt even faster.
How do you privatize money? Just allow taxes to be paid in any currency at market value, and allow business to create money. Gold, silver, copper, stocks, bonds, dollars, euros, bitcoin, ethereum, whatever. It’s all up to the market whether to accept a currency or not.
How would the private sector handle money creation and money squabbles? The answer: very simply, as we just saw with bitcoin.
Imagine if there was a political effort to split the dollar or shekel into two currencies. Could you imagine the fighting that would be involved? All the worthless news we’d have to read, all the voodoo econometricians babbling about GDP and XYZ and 123 and using words that make us all feel dumb and unqualified to have an opinion?
But bitcoin split into two in a mutually agreed upon divorce by the developers. No violence, no public bickering, no social justice warriors, nobody blabbing on about how the poor or the rich or the middle class would be hurt by the split or the non split or anything. That’s how the private sector would handle money creation and monetary disputes. With peace and quiet.
With private competition against the shekel, inflation would end. People’s savings would increase in value. Real estate prices would plummet. The war with the Arabs would have to be ended for lack of money to keep it going. If you believe that’s a bad thing, you probably have a PhD in macroeconomics, Rachmana Litzlan. (Yes, many PhD economists actually believe war – AKA the mass destruction of goods and services and people – is actually good for the economy. It isn’t.)