Below is a podcast episode where Saifedean Ammous discusses Bitcoin, politics and economics with Lex Fridman. As I was listening to it, I could not help but realize the peculiar affinity Saifedean’s words have with the philosophy of Taoism applied to these areas of life.
Inspired by this episode, in this essay I explore the political and financial dimensions of Taoist philosophy; and also how remarkably well Bitcoin plays into it all.
Frying a Small Fish
Discussing monarchy, around the 1:26h mark, Saifedean says that “the key to being a good king is to just leave people alone; let them do whatever they want…”
This is exactly the same attitude towards leadership as is presented in the most central written work related to Taoism, the Tao Te Ching:
“The Master puts herself last;
and finds herself in the place of authority.” (7.)
“Governing a large country
is like frying a small fish.
Too much poking spoils the meat.” (60.)
“Do not meddle with people’s livelihood;
by respecting them they will in turn respect you.” (72.)
“When people go hungry,
the government’s taxes are too high.
When people become rebellious,
the government has become too intrusive.” (75.)1
Here it is useful to note that this work was written not only as a philosophical treatise, but also as a guide for rulers; attempting to convey the principles of the Tao to government. Almost every verse can be interpreted in a political sense, some outright explicitly while others more symbolically.
Political Taoism is implicit anarchism. It does not propose that there ought not to be leaders; it knows that there will always be people gravitated towards this position and greater amounts of people ready to submit to them. It instead says that the leader—if he is to be a great leader, imbued with Te (integrity; power; virtue) and aligned along the sublimely intelligent organizing principles of the natural universe—ought to be, behave and govern as though he does not exist and let the people be.
The idea of being “out of the way” is quite the exact essence of Taoist thought. A room is useful only because it’s empty; i.e. there is nothing in the way preventing it from being utilized as a space. The room can be entered only by virtue of there being a hole in the wall, the door, through which people can enter it—only because the wall isn’t in the way. You can only see because your eyes or retinas are clear; i.e. transparent and out of the way of the synergistic sense of sight.2
None of these negations actually put down the importance of these things. You could not see were your retinas not empty and thus out of their own way. They enable the process of life to take place: if there was no empty space around you, you could not move to do any of the things it takes to keep living.
“We work with the substantial, but the emptiness is what we use.” (11.)
Similarly, leadership—institutional or individual—is vital for a thriving collective humanity, but it is skillful, intelligent and efficient only when it is out of the way; not preoccupied with its being leadership.
—
This principle of leadership is found everywhere in the natural world, closest to us in our own bodies. No single organ is “the boss,” though it is easy to think that the brain is. However the brain, of course, cannot function properly without every other organ functioning in their own unique manner in harmony with all the other organs and vital processes.
Let’s for a moment think that you—as the cerebral self-image and ego-sensation—are the king of your body. Your body is your kingdom; your organs are the servants that contribute each in their own way to the continuity of your life, so that you can keep experiencing and enjoying it.
You, though you are in this imaginary power-hierarchy above them, haven’t the faintest idea what all these organs are doing and, more importantly, how they do it.
If you try consciously to be aware of, say, your breathing, you quickly realize you have no clue how it happens and will begin to panic as you have the sensation of needing to take care of it manually. Imagine extending this panic to the innumerable interdependent processes going on in your body all the time! You could not handle it.
That’s why you actually let the organs and vital processes do their thing, in their own way. Furthermore, if you do only what you want to do, like eat nothing but white sugar and drink only alcohol because it gives you a kick, without listening to what your body and the organs are saying about this mistreatment, they will soon malfunction—and signal about it in a way that is almost like them turning and rebelling against you. (This is obviously what happens when people live under and revolt against unjust governments!) If you want to thrive and be healthy, you have to learn to listen to what your body—composed of its individual organs and parts—is asking for, and then give it to it (and not what you in your egoistic hubris think it wants). If a ruler wants his country to thrive, he must do the same.
Similarly, when a ruler of people wants to consciously probe into every littlest thing that the people do so as to make sure they’re doing a proper job (as if he could possibly know or improve that!), the people cannot play their parts right. The ruler cannot do his thing right either, because he is busy wasting his energy on pointless supervision and pseudo-control—whose only effect is making the people do their parts with less motivation and efficiency. This is why Orwell’s visions of the future are so eerie to us: we resent being watched over, because deep down we know that no Big Brother or centralized government can know how to do our things better than us, and a constant being-watched-over makes us self-conscious and miserable.
All of this is exactly why Lao-tzu says that the great ruler treats his kingdom as his own body.3 Not trying to control it—because he knows he has no knowledge nor resources whatsoever how to do it—but letting its parts perform their work on their own. Everyone wins, because everyone gets to keep playing their own, natural parts, fulfilling their Te, in harmony with each other—and not only with each other, but with the absolute totality of all natural existence and its organizing power, the Tao. There are no limits to the growth of such a kingdom, just as there are no limits to the growth of natural organisms; only how well its parts evolve and adapt to the realities of the physical world. When the parts are free to do what they do, to experiment freely and subject themselves to conscious error correction, they learn ever more about what is aligned with said realities. And when this growth is in line with the Tao, it will always be in harmony with everything else.
What is especially curious about the topic of this essay is that in the podcast, Saifedean said his comment as an argument for monarchy.
To paraphrase him: a strong presence of a leader is vital, yet the leader’s job is not to stick his face into everything and try to juggle a million balls in the air like a Hindu deity. Implicitly he says, exactly like Lao-tzu, that the leader is at his best when the people are hardly aware that he exists, so they can be left to do what they do best.
We can quickly note here an affirmation of another of Lao-tzu’s observations in this wonderful text: the mutual arising of opposites. Coniunctio oppositorum, a hidden unity of opposites: working monarchy is to the surface quite indistinguishable from anarchy, because the monarch has to be as though he’s not there.
—
Bitcoin: Financial Taoism
When this contemplation of Taoist thought comes to money, the reader will find my stance obvious: Bitcoin is an absolutely brilliant form of it.
Bitcoin is monetary anarchy and true democracy; a monetary network where the upholders are the same as those who utilize it. There are no centralized leaders pretending to know what is the best way to go with it; and thus the network is left free to experiment with what works and what does not, and as a result it continuously improves and evolves through conscious error correction—like all natural evolution. And all of it is completely voluntary. Absent the controlling center, Bitcoin simply has no space for coercion from hubristic egomaniacs pretending to know what the market needs; it welcomes the natural patterns of the Tao to the monetary network of humans, enabling us thus to live in harmony with ourselves and the natural world.
For example, as Saifedean says in the podcast, we do not need to be incentivized towards consumption—as is done in the prevalent fiat monetary standard—because we are already hardwired to consume what we need. What the contemporary monetary indoctrination says is that we need to generate and satisfy all manner of artificial wants to keep the economy healthy (because we are forced to use soft fiat money), with the result of prioritizing instant gratification of these “wants” over gratifying only the instant needs and saving the excess cash for later, to either gratify what we genuinely and intrinsically want or to re-invest it so that we can have more of it to do the same later. When money is saved—and, in the case of a scarce and hard currency like Bitcoin, does not degrade in value because of inflation—it can freely be used to exchange goods later between other parties and their needs, creating a healthy economy in harmony with the natural world with no need to overconsume. (Because its value does not degrade, there is no impulse to exchange it for tangible goods as quickly as you get it, of course.)
Around the 2:35h mark, Saifedean remarks that “the most important fact in Bitcoin is that the creator has disappeared, and the thing has continued to operate for almost twelve years without him being there.” It is peculiar how well his words fit into the philosophy of Taoism. It is precisely because Satoshi Nakamoto withdrew from his creation that it can grow without bounds:
“When [the Master’s] work is done, she takes no credit. That is why it will last forever.” (2.)
This makes Satoshi the perfect leader figure for this novel monetary network.
There are myriad reasons why I find Bitcoin very intriguing through the Taoist lens, but to spare the length of this essay—and your time, dear reader—I shall contemplate on them more in the future. If you enjoyed reading this, you can subscribe here to get my musings to your inbox:
Thank you for reading.
The quotes from Tao Te Ching used in this essay are from the J. H. McDonald translation, discoverable here.
“We fashion wood for a house, but it is the emptiness inside that makes it livable.” (11.)
“Love the whole world as if it were your self [body]; then you will truly care for all things.” (13.)