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Bitcoin Must Self-Regulate — The State Can Only Destroy

In the wake of Bitcoin exchange Mt. Gox’s bankruptcy filing, more than four hundred of its customers have expressed interest in filing a class action lawsuit against the parent company and its chief, Mark Karpeles. Mt. Gox was the cryptocurrency’s largest marketplace. Although Bitcoin’s functioning is still incomprehensible to many its value is real. Mt.Gox’s losses are estimated at $480 million.

The accusations of fraud and negligence are certainly justified, but a lawsuit might not be the best way to seek justice in the unregulated Internet economy. It’s odd that members of the Bitcoin community, many of whose members oppose government intervention in the money supply, are so easily persuaded to appeal to government legal systems once the situation goes awry. A lawsuit will undoubtedly open up avenues for lawmakers to further complicate use of Bitcoin and similar cryptocurrencies.

American political activist Samuel Edward Konkin III popularized the term “counter-economics” to describe all voluntary transactions that occur outside of the realm of the government-regulated marketplace. Bitcoin, and cryptocurrencies in general, fulfill an important role in this counter-economy by taking fiat money out of the equation entirely. However, to fully sustain the power of the counter-economy we must integrate non-state legal systems into its overarching framework. Instead of running back to the state when things take a wrong turn the opportunity must be used to discuss and develop systems by which businesses in the counter-economy can be held accountable for their actions.

An example of counter-economic regulation comes from the community around the Silk Road, a Bitcoin-based online marketplace for the buying and selling of illegal drugs. A group of its users calling themselves the LSD Avengers ran chemical analysis on acid they bought to test whether they were in fact in possession of genuine LSD, providing other users with a safety standard by which drugs could be ordered and consumed safely. This illustrates how a black market can self-regulate without resorting to the imposition of bureaucratic agencies like the Food and Drug Administration.

Bitcoin itself plays a liberating role in places like Ukraine and Iran, providing a system of payment independent of governments meddling and directives set forth by central banks. It is plausible that if the fate of Mt.Gox is placed at the hand of judges then regulation will follow. Regulation might satisfy our western need for guaranteed illusory feelings of safety. But it will hurt economic freedom in countries with people less fortunate than in the West. This will detract from the revolutionary potential of digital currency.

Currently there is no system by which Bitcoin marketplaces can be held accountable. Resorting to government legal systems might indeed be the only way by which Mt.Gox customers can receive the restitution they deserve. What does have to be kept in mind is that this option is far from optimal. Further talk of government regulation of crytocurrencies will not be a surprising result. In fact it seems inevitable. In the future the digital counter-economy will have to find ways to regulate itself. The ingenious online methods that are bound to come up might lead to insights by which we can regulate our own “analog” communities as well. One day government regulation of the marketplace will be a thing of the past as the self-regulating counter-economy replaces it entirely.

Originally appeared on: http://c4ss.org/content/25158

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Copyright in Defense of Racism

“You wouldn’t steal a car, you wouldn’t steal a handbag, you wouldn’t steal a television, you wouldn’t steal a movie.” Sounds familiar doesn’t it? For years the copyright industry has been telling us that piracy is a crime. However, recently another supposedly heinous copyright crime has been added to the list: exposing racism.

On September 13th the website of anarchist student organization Students for a Stateless Society (S4SS) posted a message affirming their decision to dissociate from one of their subchapters, which had recently been expressing worrying amounts of racism and threats against those of the Muslim faith. S4SS explained their decision by posting screenshots and Dutch-to-English translations of the Facebook conversations of S4SS U Gent’s public Facebook group. [1]

In response to this decision and out of fear of possible repercussions including those carried out by ‘radical Muslims’ one of the group’s racist members lawyered up and filed a copyright infringement claim. The material being claimed as copyright in this case being the racist views procured by the group’s member. That’s right. According to J.D. Obenberger racist views are copyrighted material once they are posted on a “tangible medium” like Facebook. In accordance with the Digital Millenium Copyright Act, Obenberger claims, the material has to be removed. You may think that no sane person would comply with such a threat but the webhost Bluehost shutdown the websites of S4SS and its parent organization the Center for a Stateless Society.

The Digital Millenium Copyright Act, signed into law by President Bill Clinton in 1998, aims to protect the copyrighted material of individuals on the internet. It sounds like a noble goal if one accepts the notion of intellectual property. But far from achieving noble outcomes it has served to create a dangerous and expensive legal atmosphere. Ted Gibbons says “Google notes more than half (57%) of takedown notices it has received under the US Digital Millennium Copyright Act 1998 were sent by business targeting competitors and over one third (37%) of notices were not valid copyright claims.”[2] But that is Google, they have the money and the experience to fight legal battles. Now imagine a smaller firm or even an individual providing his own hosting fighting continuous Federal lawsuits. It’s impossible.

This is why even mentioning the DMCA to a webhosting company makes them panic and causes them to shutdown websites on a moment’s notice. J.D. Obenberger claims on his own website that, “If you write the request for a takedown on a leaf of stale cabbage in magic marker, without stating any reason or offering any proof … most of them will take it down fairly immediately, within hours, because they are more afraid of you and your attorneys than they are of the posters.” It is therefore not the content of the law that matters. The threat of its use is enough to make otherwise peaceful people cower in fear as if they were the perpetrators of the worst kinds of aggression.

Thus, by abusing the threatening legal atmosphere set forth by the DMCA, racists can now force anyone who exposes them to comply with their demands. Whether or not the DMCA covers this particular situation explicitly is beside the point, the results are the same. This is how the state insulates racists from the social consequences of their actions. Anyone who values internet freedom should see the threats made by J.D. Obenberger, Bluehost’s compliance, and the copyright laws set by the state as an attack on that fundamental freedom.

[1] Knapp, Thomas L. “Copyright Nazis. Literally.” KN@PPSTER. N.p., 24 Sept. 2013. Web. 24 Sept. 2013.
[2] Gibbons, Ted. “Google Submission Hammers Section 92A.” PC World Magazine New Zealand. IDG Communications, 15 Mar. 2009. Web. 24 Sept. 2013.

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Can EPIL Avoid the Neo-Liberal Trap?

On the 28th of September four European classical-liberal and libertarian parties signed the Utrecht declaration and covenant of European Classical liberal and Libertarian parties which provides the foundation for the new European Party for Individual Liberty (EPIL). The coming years will show if the EPIL can bring a new perspective on the principle of liberty or serve as the ultra-capitalist wing of neoliberalism.

The liberal ideology in Europe today is confined to what can best be described as neo-liberalism. Neo-liberalism has become the driving force of modern day European corporate capitalism. It provides markets for the functioning of capital-intensive industry by limiting competition to a small number of large firms through regulation, licensing and subsidy.

Both those on the left and the right will likely protest my robber-baron description of the European economy, arguing that most European countries in fact have extensive social safety nets. Whilst this is true one must realize that the welfare state is an essential cog in the corporate machine. In a free market corporations would be driven by competition to pay workers a higher wage so that they could organize healthcare themselves through cooperative efforts. Instead, by socializing the costs of social services to the taxpaying public, large businesses reduce the costs of their own internal functioning. Far from being generous, neo-liberals and social-democrats alike have learned to hand out crutches to those whose legs have been broken by the system they created.

Here lies the trap that has secretly been set for the classical-liberals. They can either choose to denounce the social safety net as system of anti-capitalist sentiment, thereby receiving the appropriate title of corporate lackeys. Or they can identify the social safety net as a set of necessary crutches that ameliorate the destructive tendencies of corporate privilege and monopoly which hide behind neo-liberalism.

I hope they choose the latter. For too long free market rhetoric has been used to prop up the power of corporate capitalism without paying attention to the intricate web of privilege on which it is based. Instead of joining hands with conservatives and getting rid of “hippie socialism” classical-liberals should call for an alliance with the radical left. Together the radical left and the classical liberals can rid Europe of the privileged political and economic elite.

Such an alliance has recurrently been sought by classical-liberals. One of the earliest of European classical liberals, Gustave de Molinari wrote in 1848:

“What is the common goal of economists [ed. Classical liberals] and socialists? Is it not a society where the production of all the goods necessary to the maintenance and embellishment of life shall be as abundant as possible, and where the distribution of these same goods among those who have created them through their labor shall be as just as possible? May not our common ideal, apart from all distinction of schools, be summarized in these two words: abundance and justice?”

The American classical-liberal movement, libertarianism, also has a long history of forming alliances with the left rather than with conservatives or neo-liberals. Famous libertarian Murray Rothbard worked together with the New Left in the 1960s. His economic critique of the corporate state, based on the work of classical-liberal Ludwig von Mises, provided for much common ground with the New Left. Even though libertarians and the New Left disagreed over certain economic issues they saw eye to eye on issues like corporatism and war. This agreement could not be found with the conservatives and neo-liberals on the right.

So we will see what path the EPIL will follow. Will they aim for corporate capitalism freed from the chains of a social safety net and the regulation that keeps its initial privilege in check? Or will they realize that true laissez-faire involves not the dominance of capital intensive corporations but instead a competitive economy of equals?

It might turn out that supra-national politics do not allow for the radical second option. If so, I urge classical-liberals to re-evaluate the use of politics. Instead the true route to liberty might bypass parliamentary politics altogether in favor of direct action and building alternative institutions much like the anarchists who trace back their history to the classical-liberals of the 19th century.

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Rape is not Success

When I talk about rape culture I don’t mean to say there’s a secret male conspiracy to oppress women, I don’t mean to say that men are consciously promoting rape, I don’t mean to say men think rape is good. No. This is what I mean when I talk about rape culture:

rape success

In an important football match Bayern Munchen completely obliterated Bayern Munchen 4 to 0. They, however, did not rape them. Rape is a vile crime in which victims are left physically and emotionally broken and traumatized. It’s a crime that makes potential victims fear for their lives as they walk down the street at night. It’s a crime that must, in no way, be normalized by equating it with success in a football match.

By using rape as an edgy tool to get laughs and facebook likes you are creating an atmosphere in which rape is funny, trauma is neglected and victims are told to ‘man up’. Although this might not be the implicit goal of individuals promoting rape culture, it is what it eventually leads to.

You didn’t totally rape your last exam. Your parents did not rape you when they made you stay home during a party. Bayern Munchen did not rape Barcelona. Rape is not success.

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The Corruption of Cooperation

David Cameron, the United Kingdom’s prime minister, promised to support a referendum deciding on the UK’s future within the European Union if and when he wins the general election in 2015. Politicians across Europe react negatively to Cameron’s speech by citing their support for the Union’s economic, social, and political cooperation. My question to them would be: Why must this cooperation be directed by a centralized power?

The concept of cooperation is misunderstood by many. Cooperation is based on the realization of individual actors that a peaceful and joint venture is beneficial to both parties. Having a leader in this case could arguably be more beneficial but delegating all decision-making powers to one actor hardly seems to be a necessary prerequisite in order to call something cooperative. Yet pro-Europe politicians maintain the opinion that a centralized institution is necessary to foster interdependence. Either this means individuals are too dense to realize the benefits of cooperation or that there is no actual beneficial outcome to be attained. Either way, calling this situation ‘cooperation’ is very troubling.

Supra-national politics is not the only area in life where the meaning of cooperation has been skewed. Apologists for capitalism rightly claim that economies require cooperation between labor and capital. However they continue by saying that owners of capital must receive exclusive decision-making powers to make the cooperation fruitful. The same principle exists in our culture’s view of romantic unions. No matter if you’re gay or straight there is always the question of, “Who wears the pants in this relationship?” We thus arrive at the worrying conclusion that the concept of cooperation has been entirely corrupted by viewing the delegation of authority as a prerequisite for its existence.

Although it is unclear what Cameron’s own opinion on the matter is – whether he would vote to stay in, or get out of, the European Union – it is clear that he dislikes the direction in which the EU is heading. He says, “Put simply, many ask, “Why can’t we simply have what we voted to join; a common market?”” After all, the European Union is based on the European Economic Community, often known as the Common Market by the English-speaking world. If there are benefits to cooperation between governments and individuals across national borders than the only acceptable function of the European Union would be to help governments and individuals realize these benefits.

Of course this whole issue would be irrelevant if there weren’t national economic- and migratory-borders to start with. However, this idea is conveniently left out of the discussion for obvious reasons.

It also brings up another issue of supra-national organizations: whether they eliminate borders or rather expand them? On a related note: Are the anti-EU sentiments of many Europeans a sign of a new anti-authoritarian movement or merely symptoms of fervent nationalism? These are the questions we should really be asking. How about a referendum on them, Mr. Cameron?

Translations for this article:
Portuguese, A Corrupção da Cooperação.

Citations to this article:
Christiaan Elderhorst, The Corruption of Cooperation, Centre for a Stateless Society, 01/25/13
Christiaan Elderhorst, The corruption of cooperation, Dhaka, Bangladesh New Nation, 02/13
Christiaan Elderhorst, EU — The Corruption of Cooperation, Baltic Review, 02/08/13

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