What will Milei do?

Momento della lettura 3 minuti

In case you haven’t heard, Argentina just elected the first Anarcho-Capitalist president in the history of the world, Javier Milei. If you’ve never heard of anarcho-capitalism, it’s a political ideology that seeks to eliminate the state, and provide all services through voluntary transactions in a free market without government intervention.

Honestly, I’d never heard of anarcho-capitalists until I got into crypto. But over the last few years their vision of a world with rules, but no rulers, has grown on me. It remains to be seen how much Milei will actually be able to accomplish. His congress will be dominated by members from outside his own party. But it begs the question: how would one transform a nation state to one that is stateless?

People often ask, if there is no government, who will build the roads? But that’s just the beginning. You could ask the same question about anything we consider a public good: schools, law enforcement, the healthcare system, public transportation services, and on and on the list goes. You can’t just turn these services off all of a sudden and expect everything to be okay. Imagine having no schools to send your kids, no fire departments to put out fires, or hospitals to take care of the sick? Imagine all those people suddenly out of a job, with nowhere to go. Chaos would ensue, and things could go south very quickly. Or not.

The truth is nobody can know for sure what will happen. Our world is a complex system, and the smallest of changes could potentially lead to significantly different outcomes. But that doesn’t mean we can’t try to imagine a better future, or a better world.

Let’s say we actually achieved consensus around this idea of figuring out a better way. It’s not just going to happen on its own. A better way is not going to magically materialize because we want it to. We’d have to build it, of course, but the question is how?

We’re going to need a roadmap. Just as the eCash project has a roadmap to achieve 5M transactions per second, humanity will need a roadmap to achieve economic freedom for all.

So I’ll start. Mind you I’m not an economist. I’m definitely not an “expert”. I’m just someone who likes to brainstorm, and write down his ideas, who happens to find all this stuff fascinating. So apologies in advance if you find that what follows is idiotic, or naive, or full of holes as I’m sure it will be, but as I tell my kids, you never know until you try.

If I was suddenly made the benevolent dictator of the US, here’s my back of the napkin roadmap. First, take a little time to identify all the various government agencies to learn what they do and how much they cost taxpayers each year. Then similar to Milei, I would immediately shut down those I feel are unnecessary and wasteful, and also try to reduce the size of the ones that will need to continue, at least for the time being.

I would determine how much money would be needed to fund these remaining services and come up with a time frame for how long we might need them. If the numbers make it possible, I would try my best to eliminate taxes, or drastically reduce them, and also make them a whole lot simpler to avoid the possibility of complicated loopholes.

I would also try to subsidize the decrease in tax revenues with increased money printing. This will lead to inflation, but hopefully the reduction in taxes will help mitigate the situation.

I would change the laws to make it as easy as possible for anyone to start a business. Get rid of all the red tape and friction that stops people from trying to add value to society. There would be mechanisms to create private police agencies, private fire departments, private hospitals. I would let the free market flourish with the hope that little by little it would make the public sector obsolete and eventually lead to the elimination of the need for a government at all.

The hope is that as a result of free market competition, we get better versions of everything, leading to a kind of positive feedback loop. Isn’t that what competition always does? Without burdensome regulations and inefficient bureaucrats, I hope to see an acceleration of progress. New technologies will emerge, new incentive mechanisms, and utlimately, a new monetary system.

I’m of the belief that the singular reason we are forced to live under the rule of governments is because we need a central authority to manage our monetary system. There was simply no other way. But eCash and other cryptocurrencies can potentially change that by giving us the ability, for the first time in human history, to trade and transact without having to rely on trusted third parties. I believe eCash is the missing ingredient as predicted by Milton Friedman to help in reducing the role of government. I believe that there will come a time when money as we know it will be replaced by faster, cheaper, and more reliable forms of digital currency like eCash. Money that can’t be censored. Money that is borderless. And money that isn’t limited by anything but the power of our imaginations.