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Neo-Luddites
How the upper middle class will turn into terrorists when encryption technology changes how citizens control their wealth
The year is 2032, it’s cold and dark, and their footsteps draw paths in the dew forming on the grass. The sun will break the new day if they don’t hurry. Sarah, 47, mom, recently laid off upper management at the CBC, and Dianne, 60, former HR at Statistics Canada, place sticky homemade explosives to the side of a hydro-electric generating station in Northern Ontario and dash into the woods and out of sight. The bomb works despite Dianne’s insistence that the online instructions were a deception, and the generating station is damaged and offline for 3 months. When they post about it online afterwards, only 2 words accompany the picture: “Stop technology!”
According to some, the above scenario isn’t just possible— it’s probable. James Dale Davidson and Lord William Rees-Mogg write about the upper classes having a luddite reaction to progress in a portion of their book The Sovereign Individual. It’s one of the most eye-opening books I’ve ever read. And it was written in 1997.
The History
When new technology helps with coercion and wielding violence it comes at the detriment of the humans at the bottom, the masses. The benefits flow to those who are in control. The industrial era made it easy for states to control their citizens within their borders and extract wealth from them via taxes with very little effort or resources. As historians say, the returns on violence were high.
The second option is when new technology improves freedom and sovereignty; when the returns on violence are lowered. In these cases, (printing press, internet) the benefits flow in the opposite direction— into the hands of the many. Creating more freedom for citizens and disseminating wealth and freedom back among the population and away from centralized control.
We’re on the cusp of another power change. When wealth and power slide away from centralized authority. But these transitions usually come with tension and friction in the system. A luddite reaction to progress is one such friction.
The term Luddite comes from early 19th century England after new mechanical technologies were invented, most notably the weaving machine. Skilled textile workers and master craftsmen felt the demand for their skills diminishing and their social status eroding. They revolted, sending letters to mills and machine manufacturers instructing them to stop the progress or face violence. They signed the letters ‘from King Ludd’, a mythical figure they created.
We know now that resisting technological progress is almost always useless, even if the change-avoiders get violent, which the Luddites did. Breaking over 1,000 machines across the countryside, killing mill owners, forming militia’s, and fighting the 12,000 government troops which were deployed to stop the violence. Dozens of Luddites were eventually imprisoned, tortured, and executed for their crimes, and a new law was created: The Frame Breaking Act of 1812 made machine breaking punishable by death.
Another example is the invention of the printing press in the 15th century, which kicked off one of the most violent and deadly times in history and is similar to the change upon us now. At the time society was governed and controlled by the church. They had a monopoly on book and manuscript production, control of eduction, control of the money supply, and overall authority. The invention of the printing press and the ability to rapidly create and copy books enabled literacy and the exchange of ideas on a scale not ever seen before in human history. No longer did humans have to rely on the powers of a select few to tell them what and how to think; they could read, learn, and study for themselves.
Once the people had the technology to learn and speak for themselves, the traditional power structures that were in place slowly got undermined as more and more people realized the control and manipulation they were under. The same thing is going to happen over the next few decades.
Thanks to the printing press, Martin Luther’s 95 thesis in 1517 spread across the land and became one of the biggest turning points in history. Rapidly disseminating information that was previously controlled by the church. Citizens were able to speak out against the powers that be and the hypocrisy, over-induldgences, and secret blasphemy the church was engaged in behind closed doors. Giving voice, freedom, and understanding to the masses.
The church responded violently and recklessly. An index of forbidden books was created, book burnings were rampant, and the reformation kicked off one of the most violent stretches in human history, the Wars of Religion, and the 30 Years War (1524-1648).
But I doubt anyone today would suggest we shouldn’t have invented or adopted the printing press.
“The capacity to mass-produce books was incredibly subversive to medieval institutions, just as microtechnology will prove subversive to the modern nation-state … This may prove to be a close analogy with attempts by the US government today to suppress encryption technology. The church found that censorship did not suppress the spread of subversive technology; it merely assured that it was put to its most subversive use.”
— The Sovereign Individual
Those that are in power and those that benefit from the incumbent structure will resist change. They cannot see into the future, so they’ll grasp with life and limb onto what they have. The lesson here is that violent resistance to technological change often comes not from the technology itself, but from the loss of institutional power it represents.
I believe the fall from grace and the subsequent revolt will be even stronger in the 21st century. As the majority of the modern managerial classes are not skilled workers. They are hand-me-down’s of a previous generations skills and meritocracy. Today they’re handed spots at elite universities and positions in the public sector based on the wealth of their families and modern day critical theory.
500 years ago freedom technology made possible for everyone to have sovereignty over their knowledge. 500 years later, freedom technology makes it possible for everyone to have sovereignty over their money.
The Modern Managerial Class
Today, the hypocritical, pompous, know-it-all managerial class, who sit in their home offices tucked into sunny windowed corners of million dollar mini mansions, casually conducting wasteful zoom meetings, and pushing informational gravy around the plate with spreadsheets and slack messages no longer contribute any tangible benefit to society; and will eventually revolt when the changing technological situation shifts them into insecurity, status-loss, and panic. Some will inevitably resort to violence.
These net-consumers in society not only sit atop boards and committees to instruct us how to behave more ‘equitable’ or ‘carbon-neutral’, they’re fuelled by the stolen wealth from the remainder of society. Overtly and covertly extracted from the population and sprinkled around at the whims of politicians and un-elected officials.
Energy and production actually do matter to society. The future Neo-Luddites only generate heat in the system, not actual work, they’re the brakes. We can’t have a small number of builders, producers, and creators, while the vast majority are gatekeepers, managers, facilitators, and politicians; sucking value from the people and processes without contributing any value of their own. This is called rent-seeking. Too much and the systems burn rate is higher than its input.
“the markets in which the new elites operate is now international in scope. Their fortunes are tied to enterprises that operate across national boundaries. They are more concerned with the smooth functioning of the system as a whole than with any of its parts. Their loyalties— if the term is not itself anachronistic in this context— are international rather than regional, national or local. They have more in common with their counterparts in Brussels or Hong Kong than with the masses of Americans not yet plugged into the network of global communications.”
— Christopher Lasch, The Revolt of the Elites and the Betrayal of Democracy
The genius and the dumb-ass working in the same government department collect the same paycheque. There’s no incentive for them to produce or create. The welfare-state grows as it sucks more and more people into its payroll. Implementing new and more interesting ways to extract the wealth from society to pay for itself. But we’ve passed an invisible point of no return: when more citizens in our country rely upon government for their income and life services than those who are net contributors to it. We’ve become employees of democracy, not customers.
“Whether you produce results or not, the pay is the same.
Whether you work hard or not, the pay is the same.
Whether you care or not, the pay is the same.”— Chris Dray
The over abundance of net-consumers in society (consumers of the society’s energy itself) eventually leads to the system lurching and grasping more wealth to sustain itself— instead of trying to fix the problem and reduce the amount of consumption, they:
- Find more ways to extract the wealth of citizens to be distributed to the net-consumers (new capital gains tax) (more services for newcomers and net-consumers)
- Stop citizens and net-contributors from leaving and tax them if they do (exit taxes)
- Find new ways to shift the benefits to those who are net-consumers and away from net-producers (Quebec suggests only giving family doctors to sick and injured citizens)
These actions are immoral because there’s no way to opt-out of the system. The government doesn’t ask or tell you that it’s devaluing the money in your bank account to send out stimulus cheques or to pay for war. Government is organized crime at scale. The most immoral act is when they pass laws to extract more wealth from a certain subset of society without actually asking anyone in that subset. This is the ultimate hack for welfare-states: figuring out a way to vote themselves someone else’s money without their input.
They’ve assumed permanence, but nothing is permanent. There’ll be a restructuring, and it won’t be pretty.
The technology’s already been created, we’re just waiting for full adoption. As more and more people opt-out of the fiat money system, tax, and the welfare-state, all of this managerial waste and inefficiency will collapse. Tearing down the multi-layered ineffective organizations and burning up the rent-seekers paycheques. They’re vulnerable because they’re standing on our shoulders, on our wealth. And we’re about to take it back.
Because decentralized encrypted money equally serves the interests of every player, it’s only a matter of time before everyone is playing.
“it is doubtful that mass democracy and the welfare state will survive long in the new mega political conditions of the Information Age.”
— The Sovereign Individual
The Psychology of Status Loss
The managerial class of industrial society is particularly vulnerable because they’re mostly unskilled rent-seekers. Their jobs, salaries, and pensions are all propped up by the welfare nanny-state. Extracting wealth from the mass of society and eating up all their future prosperity to pay for seminar’s, working groups, working lunches, paid vacation time, working from home, severance packages, and assured retirement.
“I consider that to be a personal matter, and I believe I am protected by the privacy act in that regard.” — Canadian Broadcasting Corporation CEO Catherine Tait when asked if she would disclose receiving a yearly bonus on top of her $550,000 salary during a parliamentary oversight committee meeting. CBC is funded by tax payers.
The printing of money, subsidies, handouts, and all other government activities that inflate and devalue the currency disproportionately effect the poor. When the money supply in Canada is inflated thanks to government policy, or stock prices increase thanks to government intervention and manipulation of interest rates, who do you think benefits? Upper class people don’t care if the stock market and real estate arbitrarily increases in value— they own those things. And they don’t care if gas and grocery prices go up because they have money. But what about the middle class? Gas, real estate, groceries, clothing, and stocks all increase in price… okay great, now it’s even hard for us to buy real estate or get into the stock market, and oh by the way, all your living expenses are now astronomical. What kind of system is this?
Politicians worldwide have been proselytizing about saving the middle class since time immemorial. But their actions tell a different story. Keeping the powerful in power, and the rest— oblivious and at work.
Thanks to Bitcoin and other encrypted technologies more and more wealth and energy will continue to be transferred from central authorities to the hands of sovereign individuals; where it’ll remain impossible to extract. (just as the knowledge lodged in the heads of 16th century peasants after learning to read)
The downfall will begin with a loss of identity and status. Years invested in credentials, education, high salaries, premium real estate, retirement plans, and their lifestyle expectations will start to fade and become unaffordable, unpayable, or irrelevant. And their social influence, community respect, decision-making authority, and their children’s prospects will wash away causing an acute and painful identity and meaning crisis.
“Who will the losers be in the Information Age? In general terms, the tax consumers will be losers . . . They will lose income because they will no longer be able to depend upon political compulsion to pick the pockets of persons more productive than themselves. Those without savings who rely upon government to pay their retirement benefits and medical care will in all probability suffer a fall in livings standards.”
— The Sovereign Individual
They’ll inevitably go through the stages of grief and become angry at the world. Angry at tech companies, angry at early adopters, and angry at the changing system. They might begin to bargain by proposing regulations or hybrid systems. Followed by depression at the acceptance of the loss of status, purpose, and identity, forcing many to become radicalized. To reject the new system, to justify their resistance, and to embrace extreme measures. It’s happened before, many times, don’t be so naive to think it can’t happen again.
Catalysts for Revolt
Approximately 3.5 – 4 million people (roughly 20% of total workforce) work directly for the Government of Canada. And approximately 25-30% of the workforce (4.5-5.5 million people) work in soon to be automated, low-skill and rent-seeking type professions such as; corporate middle managers, administrative supervisors, project managers, department heads, lawyers, accountants consultants, financial advisors, insurance brokers, HR professionals, compliance officers, regulators, and licensing administrators. This means that potentially 35-40% of Canada’s workforce could be vulnerable to this type of displacement. They’ve become burdensome and detached from how society is supposed to work.
Roughly 4 million people and all government departments rely on the ability to extract wealth from the remainder of society. As more and more people hide their wealth with private keys, become locally focused and sovereign, they’ll have no choice but to become more ruthless with their wealth extraction and taxation. Eventually it’ll start to collapse and the panic will begin.
“What mechanisms do we have at all for simple things like tax enforcement? If in fact you can’t crack that at all, government can’t get in. Then, everybody’s walking around with a Swiss bank account in their pocket.” — Former President Barrack Obama speaking on cryptocurrencies and encryption technology.
“An intense and even violent nationalist reaction centred among those who lose status, income, and power when that hey consider to be their ‘ordinary life’ is disrupted by political devolution and new market arrangements.”
— The Sovereign Individual
The collapse has already started. Early signs are there. But taxes keep going up and up. Check your income tax statements, look at your receipts. How much have you paid in taxes this year? Last year? And what do you have to show for it? Did you have quick and easy access to healthcare? Does it feel like society is productive and creating new places to work and live? Does it feel like the military and infrastructure systems are improving and growing? Did the government add to its debt or pay it down? The costs don’t match the services— not even close.
The forms of government that will replace the status quo will be those that uphold property rights and administer justice while consuming the least amount of resources.
“Corruption, moral decline, and inefficiency are the signs of the end game”
— The Sovereign Individual
Decentralization and blockchain technology is already replacing many of our modern systems even if you’re one of the many currently unaware. Decentralized social platforms with no CEO operate without censorship and give content revenue directly to the creators (NOSTR). Bitcoin gives hundreds of millions of people permission-less, sovereign, incorruptible, freedom money, without a single employee. Smart contracts on blockchains will eliminate legalese middlemen and other rent-seeking jobs. And AI will replace many menial tasks and jobs along the way. It won’t be long before it’s too big for the average person to notice.
“the new mega political conditions of the Information Age will make it increasingly obvious that the nation-state inherited from the industrial era is a predatory institution. With each year that passes, it will seem less a boon to prosperity and more an obstacle, one from which the individual will want an escape.”
— The Sovereign Individual
When the majority of us stop using fake money and central authority loses the ability to tax us nefariously. What do you think they’re going to do? Pat themselves on the back for a job well done and head to the cottage for early retirement? — I doubt it. They’ll resist and fight any change that will collapse their power and wealth. Government is supposed to serve its citizens but the democratic nation-state uses its citizens like cows, keeping them in the field to be milked. Thanks to Satoshi Nakamoto, the cows have figured out how to keep, store, and trade their own milk.
Forms of Resistance
The person who thinks he or she knows the future is naive and wrong. We never know. But taking a step back and looking at things broadly, historically, and rationally, we can see 2 things:
- Things always change
- There’ll be resistance to change
The history on this is pretty clear. Even though our education system seems to have lost the will to teach the important things. The examples are there, if you manage to pick up a dusty history book and read it. There’s 3 things that appear to almost always precede societal collapse are: income inequality, wage stagnation, and competition for elite jobs.
Those that benefit from the current system will try to stop the change regardless if they’d be better off just accepting the change and going with it. They’ve already begun fighting. Resistance to freedom and sovereignty are rampant in the modern world. They steal our wealth, coerce and manipulate us with control of information, and spy and track us at every move (digitally and physically).
Most western countries have a tax for even trying to move aboard. Some, France, have even suggested an income tax on their citizens who no longer live in France. The futile regulatory war against cryptography is happening in some circles of power. But there are a few who are taking a different path, either because they see the prosperity it’ll create, or they realize anything else is useless. El Salvador has made Bitcoin legal tender and is mining Bitcoin with its natural resources. Switzerland, UAE, Singapore, Ukraine, and Bhutan are on similar paths. And the states of Arizona, Florida, Wyoming, and Texas have all passed pro-Bitcoin laws and regulations.
The knowledge 16th century peasants gained by reading Martin Luther’s thesis, and other works, couldn’t be removed. The damage was done, it was too late and too futile for the church at that point. You can’t remove the information from their brains— so they imprisoned and tortured them. After millions lay dead they finally relented. And a new era began, more open, and more free. People were finally allowed to have sovereignty over their voice and thoughts. Because they should. And today, you can store your wealth in your brain by remembering 12 words.
It’s playing out again. People should be allowed to control their wealth. A human should be sovereign over whatever wealth they produce or create. It’s theirs. A Canadian dollar saved from the year 2000 to today has lost 40% of its purchasing power. Where did almost half of the dollar go? I encourage you to learn that answer for yourself. But the short answer is— it was stolen, without a vote or explanation. Most people are unaware and they’re capitalizing on it.
Bitcoin and blockchain technology will be fiercely fought against and opposed by the powers that currently control fiat money and those whose way of life is threatened by the loss of it. It’s a sad reality that there’s nothing that they can do about it and that violence is most likely on the horizon before they realize it.
There’ll be political movements to ‘protect democracy’, ‘save the dollar’, and nationalistic type movements to protect the ‘way things used to be’, but there’s no such thing as ‘used to be’. And there’ll most likely be violent action against the new. But it seems to be in our nature, human’s are easily programmed. Those in the upper crust of society are there in large part not because of anything they did or didn’t do, and same goes for those on the lower rungs.
At the end of the day, violence and revolution are not required, so we should strive to avoid it. Let’s educate ourselves and others about decentralization and encryption so politicians and the managerial classes who might react negatively can learn that things for them will be good in the future as well. And bring our voice to our member’s of parliament and government officials, to tell them that we want the future to be prosperous, that we believe the individual is sovereign and should not be subject to control or coercion. That we have the right to store our wealth without plunder.