Elements of the Philosophy of Decentralization
The worlds first attempt at globalization has failed because there was no alternative to the centralization of wealth.
In this article, I will make the case that Colonialism and Neo-Colonialism were built around the centralized principles which both Capitalism and Communism share. Neither ideology has been successful at providing a true decentralization of wealth. Communism collects wealth at the top of the state system while the masses suffer. Capitalism collects wealth within the institutions of the Western world, including the institution of a middle class, while the emerging masses in foreign nations suffer. The centralization of wealth is the common theme across both, with varying centralization taking place dependent upon political systems and cultural orientations.
Throughout the history we are about to explore the one common denominator is the lack of a trusted alternative to the centralization of wealth. The Ripple Interledger Protocol and the developing XRP ecosystem, along with the larger crypto market and initiatives, will provide such a trusted and decentralized system for the first time in the history of the world. It will change our ideological prejudices and allow for the evolution of our systems of governance. This is not the anarchist or Bitcoin maximalist view of the world, but is a logical exploration of where we have come from and where we may be going, with honest reflections on both Capitalism and Communism, with the hope that we can consciously participate in the creation of the decentralized world developing around us.
One of the greatest female intellectuals of the 20th Century was Ayn Rand. The massive novel she wrote titled Atlas Shrugged, published in 1957, is one of the seminal works of the last 60 years. It’s serves as a logical and realist response to late Marxism, but weaves within the storyline the real-life evolution of the Marxist ideal, which began with the earlier writings of Karl Marx and Frederick Engels, such as Das Kapital (Capital Volume 1- 1867, Capital Volume 2 - 1885, and Capital Volume 3 - 1894).
All three volumes of Das Kapital mark the transformation of the ideas which were put forward in the Communist Manifesto of 1848. Even further back in 1843, the works of Marx and Engel were more focused on the construction of Socialism. The ideological framework evolved with the thoughts of both men towards the complex, and often times contradictory nature of complete state control under Communism.
Marx wrote a paper in 1843 titled A Critique of Hegel’s Philosophy of Right. An exploration of this philosophy begins with developing an understanding of the concept of free will. The philosopher Georg Wilhelm Friedrich Hegel published Elements of the Philosophy of Right in 1820 and argued that free will could only be realized under the social context of property rights and relations. Along with contracts, moral commitments, family life, the economy, legal system, and an organic hierarchal structure of society, the complexity of free will could be attained and sustained through the historical collapses of all states and empires.
Hegel segmented the philosophy into three spheres. The first sphere was built around the abstract rights of the individual, which was the idea of non-interference as a method of respecting others. The second sphere was built around the expected moral standing of the individual, where each reflected their own subjectivity onto others as a form of respect. In essence, treat others as you wish to be treated. The third sphere held the principles of the ethical life, which evolved from the subjective emotions of the individual as it applied to the universal notions of right, or right-mindedness. Right-mindedness is the act, or process of moving towards what is right.
Ayn Rand developed her philosophy of Objectivism around the evolving conflict, or contradiction, between Marxism and Hegel’s Philosophy of Right. Hegel’s work is widely recognized as “one of the greatest works of social and political philosophy ever written”, and for full editorial transparency, I would tend to agree. These are just the broad strokes of the philosophy, but I would encourage interested readers to explore further the correlation between Hegel’s Philosophy of Right with the American Declaration of Independence, just as one example.
Where Hegel attempted to reconcile the contradictory natures of capitalism and the state, mainly being the inability to balance the moral and ethical allowance of the state towards its organically structured hierarchy, Rand openly embraced the selfish nature of Man as a virtue. Objectivism rejects altruism, or self-sacrifice as the moral ideal, and argues that the ultimate moral orientation of each individual is towards his or her own well-being. The Communist state promotes the opposite as its preferred attempt at balancing the contradictions.
Where Hegel found a contradiction, Rand found objective truth about the nature of Man. This is important to understand because Marxism would argue that neither Hegel or Rand is correct and that only the state can bridge the gap between Man’s nature as an individual and Man’s responsibility to one another. The continuous failure of Communist utopias would suggest that in spite of the well-being intentions of those who see a future in Marxism, it’s acceptance of one aspect of Man’s nature, being the selfish aspect, is superseded by Man’s more powerful need for an incentive towards productivity. Man, as an individual has an incentive. The state cannot be the source of productive incentive for the reason that productivity begins within the sphere of the individual. Remove this incentive and the state murders itself.
It was always peculiar to me that Ayn Rand, and her great works, were largely ignored by Western academia and media. The progressive orientation of the Western world and its institutions should embrace the intellectual philosophy of a female who fled the Bolshevik Revolution in Russia and who would later, while living in New York, develop her own philosophy as an argument against the horrors of Communism. A world of rightmindedness would have built statues of Ayn Rand and her works would have been mandatory in all of our institutions of higher learning.
It was only as I grew older and wiser about the structure of the world and the influences upon our institutions of governance, academia, media, economics, and entertainment, that I became aware of the hidden Marxist methodology, and its impact upon the evolution of late Western culture and thought.
The strategic positioning within the Western institutions of those promoting the Marxist ideology since at least the end of World War Two is an objective truth which can be correlated with cause alongside the overall cultural trends and expansion of government regulations towards more state control. Rand witnessed this progressive march towards Marxism in America and expressed her philosophy of Objectivism as her own unique way of providing a counter-argument which was rooted in the natural instincts of Man, as opposed to ignoring those instincts.
Atlas Shrugged is the story of female protagonist Dagny Taggert and her quest to answer the eternal question “Who is John Galt?” Through Taggert’s eyes, we experience the expansion of socialist government regulation and the strangling of the industries which had been built by the individual hands of those with the incentive to do so. The men and women of power in the nation begin to shut down the companies and industries they created in protest over the control of the state. The state begins to erode and wealth is evaporated alongside the incentive of each individual for productivity. It is a predictive vision of what threatens the Western world now.
Capitalism, though the best ideological approach to a socioeconomic system of governance which has been developed, still falls victim to the same contradictory nature which both Hegel and Rand attempted to explain under each of their own unique philosophies. This is the selfish nature of Man and his natural inclination towards centralization in service to the self.
Rand was right in that selfishness is a virtue, but selfishness is scalable and the full potential of human selfishness, in turn, is expressed in the ideological evolution of Marxism. Marxism, which begins as selflessness, becomes, at its inevitable conclusion, an expression of human selfishness as those at the top centralize the wealth around them while those at the bottom have little.
Capitalism, which begins with the application of responsible selfishness, will invariably fall victim to the same unaccountable selfishness which marks the process of corruption and wealth centralization within the Marxist framework. It has been argued that the Capitalist system has not been allowed to evolve organically as the Socialist and Marxist image will always imprint itself on the free markets through those in government and academia who develop and impose unwarranted regulation.
Indeed, both systems are different, but neither exist in a vacuum, or function without interaction. It can even be argued, which I may soon be inclined to do, that both Capitalism and Communism, and the ancient human behavioral trends which are represented in each, cannot exist without one another. Both have a positive and negative impact upon the other, but it should not be postulated that the negative characteristics of each are due to the negative influence of the other, though a modest correlation with cause, and equally without cause, can be made. We may explore this further in the future.
Putting forward the idea that both Capitalism and Communism are different roads towards the same centralization of wealth is controversial in a world where each considers the other to be the externalization of human selfishness. It should also be recognized that the rate of corruption towards collapse is different in both. While Communism can collapse at faster rates, a complete corruption and collapse of a Capitalist state have not actually been experienced. There are various reasons for this, the most obvious being that Capitalism creates a vast middle class which acts as a buffer between the corruptive nature of both.
In simple terms, a state which is established as Communist will experience a rate of corruption and decline which will be measurably faster than that of a state which was established as Capitalist and was provided the time to build a middle class which could balance the political tendencies of both. As such, Capitalism is considered the more efficient and effective system of economics operating under small government, and I would agree from the perspective that there has been no viable alternative which maintained incentive and provided the buffering and balancing characteristics of a middle class.
As humanity and its systems of economics and governance evolve, there is no need, or perhaps incentive, to remain locked between the diametric imbalances of ideologies which were developed in the 19th Century. When we consider the origins of both throughout the ancient and historical record of socioeconomic evolution, the need for a new answer to Man’s natural inclination towards broad selfishness becomes even more demanding. This is not the virtuous selfishness of Objectivism, but the enhanced and corrupted selfishness which is embedded within both Capitalism and Communism.
Under Colonialism the transfer of value was enacted by invading territory through war or cultural absorption and harnessing the time and labour of the people, and natural resources of the land, by establishing remote systems of governance which could be controlled and dictated from the centralized seat of influence in whatever empire or nation was projecting its power afar. Under this methodology, the Spanish Empire, Dutch Empire, French Empire, and the English Empire extended their reach around the world to every continent.
This Colonialism is negatively viewed in the modern world and Marxist condemnation of its tenets are not hard to find in the institutions of academia and media. Though I would suggest that the Colonialism of the past carried characteristics of both Capitalism and Marxism, the falsified and progressive history of Colonialism is that it was an earlier manifestation of what would become Capitalism.
The argument can alternatively be made that Capitalism was the response of those attempting to escape Colonialism and establish a nation which was built on the principle’s which Hegel would later describe in his three spheres of the Philosophy of Right.
In turn, Communism was also a response to Colonialism, but for a whole different set of reasons. We will explore this in another article. As in brief below, I will be making an extended case that Capitalism was a product of the Protestant Reformation.
The United States was formed under the Protestant principles of freedom and liberty which would later be encompassed in Hegel’s own philosophy built around free will. The British and French colonies were settled in the 17th Century by those who faced persecution in Europe. These Protestants stood against the Catholic Church, as well as the Church of England, and refused to compromise on the religious convictions they hold. The settlers wanted to worship God through the direct relationship they believed to be correct, and not accept the Pope or Church as the intermediary between themselves and God.
God’s plan had to be realized in the New World and the great “City on the Hill” would need to be built as a symbol of that plan. Colonies which were originally planned as commercial ventures, such as Virginia, were organized around “militant Protestant” leaders who carried the strength and vision of Martin Luther and his stand against the tyranny of the Church and Pope. The real colonial power of Pope and Throne soon followed and brought murder and mayhem with them. Both clashed across two continents and engineered the socioeconomic ideals of Capitalism and Communism as cultural tools to continue waging Reformation war upon one another.
The one common theme across the history of the world, and especially the last few centuries as it pertains to our subject matter, is the inability of Man to organize civilization and wealth under anything other than a centralized model. The possibility of a trusted and decentralized model of wealth designation and value transference has never existed until now. The characteristics of the centralized methodology are developed to leverage the enhanced selfishness which self-corrupts.
Value-centralization became even more prominent under Neo-Colonialism and its projection of American hegemony. This American Neo-Colonialism, built on both the Capitalist and Marxist ideals, used economic, political, cultural, and military pressures to control and influence nations around the world. The rise of the USD to international dominance under the Bretton Woods Agreement (See The Geopolitics of XRP utilizes various Neo-Colonial tools, such as the SWIFT system of international payments, to spread and maintain its centralized power base.
Globalization 1.0 failed because it was being built on these principles of centralization. Marxists would have us believe that globalization failed because it promoted unfettered Capitalism, but in fact, globalization utilized both ideals to further its ends. China’s movement away from Communism towards Capitalism supports this conclusion. America’s movement away from Capitalism towards Communism equally supports this conclusion.
Somewhere in the middle under a decentralized Interledger using XRP as the core exchange asset, the world will begin to experience something I will call Value-Fragmentism. This is the fragmentation or decentralization of value around the world. Emerging nations which have been on the wrong end of Neo-Colonialism will now begin to experience Value-Fragmentism as the USD and Bretton Woods are reversed. Mojaloop and other XRP inspired projects will further enhance and speed up the process of Value-Fragmentism.
The hoarding of value in centralized economic and governance structures stands against the ideals of the Protestant Reformers and those who dreamed America into existence. Neo-Colonialism and the continued centralization of wealth are not what Hegel or Rand would have wanted. Hegel’s Philosophy of Right and Rand’s Objectivism, or the virtue of selfishness, are not exclusive to those holding power in the Western world. It applies to those in the emerging nations and markets with equal passion and application.
Ripple’s Interledger and the evolution of the XRP ecosystem which they are promoting, along with Mojaloop and the micropayments industry being built by Coil, are all encouraging the world to move towards this Value-Fragmentism or decentralization of wealth.
Two seemingly opposing ideologies, Capitalism and Communism, have both leveraged the centralization of wealth towards their own ends. Value-Fragmentism and the decentralization being engineering into the framework of the world’s systems of economics, finance and commerce will force both to evolve or be destroyed. Each promotes selfishness for different reasons but towards the same end. It is my position that both will merge and evolve into something new.
Objectivism, or selfishness as a virtue, could be more fully realized as a positive principle with each human being serving as their own centralized node operating in a massive decentralized system which promotes Value-Fragmentism through the application of Hegel’s principles of Right. The rights of the individual, the morals of the individual, and the ethics of the individual can be maintained under each of our own centralized nodes but held accountable across a decentralized system. It would be a stretch to consider each a Marxist node of the individual, as Marxism is about the centralization of all power within the state, but consider the same principles applied to each individual as a functioning state within a decentralized system built on free markets and trust.
Somewhere in that middle, we will find the new ideology of tomorrow. How it looks will largely be dependent upon us and the decisions we make moving forward. It is highly probable that all people would like to see others do well and achieve their dreams. This will be the theme of Globalization 2.0. There will be new challenges, but the centralized natures of Capitalism and Communism which handicapped the first attempt at globalization, from Colonialism to Neo-Colonialism, will no longer be relevant in the XRP decentralized world. - JC
Written for the XRP Community Blog and published simultaneously on Philosophy of Metrics.