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Comment by w0de0 | Hacker News Reader

What of the social contract?

The dystopia I see in your words: government as an efficient service provider providing for and competing for the patronage of the ultra-wealthy holders of cryptocurrency: the monopoly on force is broken because wealth is forever exempt. Socialized, societal wealth of all forms - roads, healthcare, police, defense - discarded. The underclass of every nation left without recourse to the power of government to redistribute wealth, and a global oligarchy is ascendant.

Government's first calling should not be efficiency. That's a misapprehension of its purposes.

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Taxation will not disappear in a crypto world, and that's how government would fund themselves. Societal wealth will continue in the form of roads, police, healthcare etc. Govt. will have to be resourceful about how it spends its tax earnings. The key difference is that Government can't go money printer brr whenever tax revenues aren't enough simply because they don't allocate resources efficiently. Tax rates in the US are high enough already. If they were increased more, people might leave. In a crypto world, there would be genuine pressure for the Government to lean up and cut back on unnecessary spending.

In a world where resources are constrained, you will not have SF county spending $61k per year per tent for the homeless. The state would die if they spent with such unconcern. https://www.sfchronicle.com/local/article/S-F-pays-61-000-a-...

SF County can't print money, only the federal government can. As far as I know California receives the least amount of federal tax benefits. They pay more then they recieve

Yes, I am aware of SF county being unable to print (only the central bank can). The point I am making is that this is an instance of wasteful expenditure that would be expensive in a world where nations lose control over currency and are operating on a tight budget that enforces skin in the game and discipline.

This is also an argument for a gold standard. What is a society to do when collective debt can help? For example: existential war, economic turmoil. Do you contend that governments should never spend on credit? I contend that printing money may sometimes be a good idea.

What society would undertake moonshots like DARPA... or going to the moon... if it could not invest with debt collateralized on a future generation's produce?

Spending on credit that you never pay is different. With a smart contract a government would have to release it's collateral. Now they can just keep the inflation up.

Ah, sure, the next generation pays, even as they generate even more debt themselves. I acknowledge it's a Ponzi scheme. But well managed, and expecting consistent growth in the productivity of our society over generations, the Ponzi scheme won't collapse.

Yep. There's a reasonable argument to be made that the decline in the Western Roman Empire's ability to raise taxes led in part to feudalism and the decline of cities and the transformation of rural peasantry into serfs. Authoritarian landholders and aristocratic armies replaced an (admittedly oppressive but also moderately concerned with some social welfare) organized state.

The state is a double-edged sword for sure. But denying its ability to raise revenues seems like a great way to hasten dystopia.

A system that can't fund itself via taxation alone is broken and needs fixing. Money printing is a proxy for taxation but targeted at the poor, as the rich aren't affected (arguably, they do better as assets go up).

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