In times of indebtedness, ideas of a ‘reset’, debt forgiveness, or jubilee, are considered. For example, and published in 1919, John Maynard Keynes’ ‘The Economic Consequences of the Peace’ wrote to the problem of Germany’s liabilities from the Great War, where Germany owed a great debt to the Allies, the Allies a great debt to Britain, and Britain a great debt to America, with war loan holders in each country being owed a large sum by the state; the state in turn owed a large sum by these and other taxpayers.
For Keynes, the whole position was “artificial, misleading and vexatious”:
“We shall never be able to move again, unless we can free our limbs from these paper shackles. A general bonfire is so great a necessity that unless we can make of it an orderly and good-tempered affair in which no serious injustice is done to anyone, it will, when it comes at last, grow into a conflagration that may destroy much else as well.” (The Economic Consequences of the Peace, Chapter 7: Remedies, II The Settlement of inter-Ally indebtedness, 1919)
Keynes’ unheeded warning proved correct: Germany’s simmering resentment from the onerous terms bestowed on it from the Versailles Treaty — a “Carthaginian” peace — formed the back drop to the rise of fascism in Germany, sowing the seeds for a second world war.
As this is being written, the relationship between ‘History’ and prejudice is very much a contemporary hot-topic! The meaning of prejudice or the prejudicial, relate to what might be considered ‘judicial’, fair, or otherwise, in a predetermined sense to the wider context of the circumstances of which could be considered ‘justice’ as genealogical to the manner it forms an equilibrium of majority decision making and the form of determined representation by which such decision making is possible at any given time.
The ‘ideal’ form of justice wouldn’t be open to interpretation (it would be unstated and self evident) and while in a context of repetition and evolution of strategies, game theory acknowledges coalitions — as opposed to alliances — of players in a game could be implemented by contracts, it also acknowledges contracts are intrinsically verbal and therefore open to complication, rendering an ‘ideal’ legal, contract, or judicial standard, difficult.
Mike Tyson’s famous quote that “everyone has a plan until they receive a punch in the mouth” is redolent of Prussian Field Marshall Helmuth von Moltke and his saying “no plan of operations extends with any certainty beyond the first contact with the main hostile force” and von Moltke’s observation that strategy is a system of expedients speaks to geometrical representation of pictures and the Byzantine Generals Problem.
It was during the first of all encompassing military strategic campaigns between 1914–1918, that Ludwig Wittgenstein — who by this time had a philosophical relationship with Keynes (who once referred to Wittgenstein as God) — wrote Tractatus Logico-Philosophicus: addressing the central problems of philosophy and of the simultaneous world, thought and language — presenting a ‘solution’ (as Wittgenstein terms it) grounded in logic and in the nature of representation.
For Wittgenstein, the world is represented by thought, which is a proposition with sense, since they all — world, thought, and proposition — share the same logical form. Hence, the thought and the proposition can be pictures of the facts, irrespective to plans and strategic games.
In 2003, Economics Nobel Memorial Prize winner John Nash published a paper on how to eliminate verbal complications from contracts in context of repetition and evolution of strategies by specifying an election procedure.
This procedure was to “form the basis for a game of non-cooperative form to be played by the players of the original game being translated.”
This was an election process where the agent is entirely uncommitted and his election is irrevocable for each specific playing of the game:
“…the actual results of calculations seem to indicate that this convention on elections is “asymptotically non-prejudicial” since the probability of simultaneous votes seemed to tend towards zero while the probability of “successful” elections tended towards +1.” John Nash, A Project Studying Cooperation in Games Through Modeling in Terms of Formally Non-Cooperative Action in a Repeated Game Context, 2003
In consideration of bitcoin, the problem which bitcoin is said to solve is the determination of representation in majority decision making, and there is further insight in respect of bitcoin application:
“The design supports a tremendous variety of possible transaction types that I designed years ago. Escrow transactions, bonded contracts, third party arbitration, multi-party signature, etc. If Bitcoin catches on in a big way, these are things we’ll want to explore in the future, but they all had to be designed at the beginning to make sure they would be possible later.” Satoshi Nakamoto, 2010
While modelling cooperation in games in the first decade of this century, John Nash was also promoting the “Ideal Money”, which was theoretically ideal because it was intrinsically free of inflation or “inflationary decadence”, depending on which version of Ideal Money is being read.
Nash recognised however that an Ideal Money couldn’t be so ideal, that it wouldn’t circulate because of an attractiveness to hoarding (in the way an “ideal justice” couldn’t be so perfect as to be open to instant and universal consensus), so Nash introduced a steady and constant inflation rate (an “Asymptotically Ideal Money”) that would be more or less as good as ideal money, in the way Nash introduced an asymptotically non-prejudicial basis for an election process that could serve coalition formation through cooperative adaptations in repetitive games and evolutionary strategies — John Nash’s Ideal Money would be a metric for comparisons of competing currencies, as well as a media for dispute resolution.
Nash notes his first observations on the Ideal Money were a system for the successful performance of contracts, and spoke to refining indices that would be reflective of longer term economic patterns, which wouldn’t need be good for all eternity, but would only be in need of regular adjustment.
While there were no specific proposals for the components of such an indices (an Industrial Consumption Price Index), Nash does speak to electrical energy, coincidentally to how Satoshi Nakamoto speaks on the price of a commodity gravitating toward its costs of production in relation to the mining of bitcoin.
Nash’s notations on the psychology of inflationary dynamics and its targeting, include a remark on the business cycle taking its toll:
“…even if at a certain moment in time, the freshly minted money is not immediately ‘bad money’ (in Gresham’s terms), it can soon turn into ‘bad money’ when it becomes part and parcel of the inflationary dynamic and the business cycle takes its toll.” John Nash, 2015
Specifically, John Nash remarks on the effects of a time dimension being introduced into a mortgage:
“…when it comes to inter-temporal, long-term transactions, e.g. mortgages, the difference between ideal money and typical European currencies would be somewhat intense, if not dramatic.” John Nash, 2015
John Nash acknowledges the thinking of Keynes as “multi-dimensional”, even if Nash is critical of so-called “Keynesians” and their ability to create money from a basis of variance: there are similar characteristics to Keynes’ bancor proposal and John Nash’s Ideal Money in the recognition of the paradox of there being a burden of a reference currency used in international relations (the American dollar).
There is parallel too between John Nash’s Ideal Money and his modelling of coalition formation in dispute resolution, and the characteristic of bitcoin irreversibility as part of a bonded contract and legal arbitration process similar to how Keynes spoke of The Economic Consequences of the Peace.
In returning to Ludwig Wittgenstein’s Tractatus: it is a structure which sets itself as representative to its internal essence, constructed around seven basic propositions, numbered by the natural numbers 1–7, with all other paragraphs in the text numbered by decimal expansions.
There is a resonance with John Nash’s Ideal Money and of a “dimension paradox” and the internal properties of a bitcoin:
“…as a result of the devotion of labor and capital to the effort of mining to increase less (or decrease more) than might be expected. There is a “dimension paradox”: agricultural products are produced by using the 2-dimensional resource of the earth’s surface, so the “disappearing frontier” creates a limitation.” John Nash, Ideal Money, 2002
The simple inference being, that more can be found to the internal realm by “digging deeper”. A place where the culture becomes the mind and where the machines are capable of taking less explicit instruction.
