An exciting new project I learned about recently is FreeSpeechMe (mirror), a project by libertarian Michael Dean and others.
This is a project to spread and improve Dot-Bit (.bit), ”a new top-level domain that, unlike Dot-Com, Dot-Net, Dot-UK, etc., is NOT controlled by any government or corporation.” It only costs about 7 cents to register, using Namecoin (a derivative of BitCoin). To access a .bit domain, a browser plug-in can be used. This was discussed in detail in an discussion by Dean on the Ed and Ethan show the other day.
A little over a year ago, a 26-year-old programmer and activist was murdered. His name was Aaron Swartz, and although he was found hanged in his Brooklyn apartment, and his death ruled a suicide, there is little question whose hands are stained with his blood. He was pursued mercilessly by a bullying prosecutor with a long track record of ruining the lives of brilliant (and perhaps naive) young men who didn’t play by the state’s rules. And he was betrayed by an educational institution that once prided itself on not playing by the rules, either.
Those are some of the heartbreaking and infuriating insights from a story in this month’s edition of Boston magazine about Aaron Swartz’ arrest and indictment, his father Bob’s attempts to extricate his son from the legal mess, and the relentless pressure by federal prosecutors to make an example of him. The punishment they sought for Aaron was draconian even by the feds’ standards: 13 felony counts under the Computer Fraud and Abuse Act (CFAA), with a possible prison term of 35 years, and a $1 million fine. Bank robbers and terrorists have received more lenient sentences. But U. S. Attorney Carmen Ortiz declared that Swartz’ prosecution would serve as a warning to other “hackers” about “stealing” from computers.
What did Swartz “steal”, exactly? Nothing. He downloaded files from JSTOR, an online archive for academic journals. Swartz used the network at MIT, where his father served as an adviser, under its “open access” policy, which included its subscription to JSTOR. Swartz had long held the view that scientific research should be freely available and not locked away behind a paywall. This wasn’t even the first time Swartz had performed such a download; in 2008 he grabbed 2.7 million documents from PACER, a federal court document system that usually charged for such access, even though they were public records. That attracted the FBI’s attention, but they found Swartz had committed no crime.
Swartz in fact had devoted much of his young life to finding ways to liberate information. Some of his earliest work included coauthoring the RSS 1.0 specification, a syndication format for Web-based content; founding a company to create wiki-based technology, which eventually merged with Reddit; and co-founding Demand Progress, an online advocacy group known mainly for its opposition to the Stop Online Piracy Act (SOPA). Swartz had also worked with Lawrence Lessig, a law professor and an advocate for intellectual property reform, studying under him at Stanford and later as a research fellow at Harvard. Swartz aided Lessig in developing the Creative Commons alternative copyright framework.
Given Swartz’ professional credentials and his history of “hacktivism”, what made his bulk downloads from JSTOR any more egregious than his previous exploits? The fact that Secret Service agents responded to the report of a “security breach” in the MIT network provides a possible clue:
When the Secret Service arrived, Bob [Swartz] says, the first thing they asked was whether any of the university’s classified research was threatened.
It wasn’t, but the nature of Swartz’ download, from a laptop hidden in a utility closet, made it look more suspicious to the feds. And it’s not surprising that a university receiving nearly a billion dollars in federal grants might toe the line with regards to any demand from the government, its hacker ethic be damned.
Intellectual property enforcement also played a role in Swartz’ prosecution. JSTOR subscriptions are not cheap, costing schools up to $50,000 per year. But MIT had a policy that not only allowed anyone on campus to use their network, but did not require authentication to access JSTOR. It was only after Swartz’ bulk download that suddenly “unauthorized network access” became an issue, allowing him to be charged under the CFAA. At worst, Swartz cost JSTOR some bandwidth during his download (to its credit, JSTOR settled with Swartz out of court and pursued no further legal action), but he didn’t steal anything. The concept of intellectual property, and the framework used by the state to enforce copyright, rests on the logically bankrupt notion that downloading a copy of something without permission constitutes “theft”. Never mind that Swartz did have permission in this case — once he broke some imaginary and unwritten rule (“too many documents”, apparently), his action rose to the level of a felony in the federal government’s view. This preposterous reasoning was all prosecutors needed to go after Swartz.
It was Aaron’s misfortune that he did his deed in a district with one of the country’s most notorious cyber-crime prosecutors. Stephen Heymann, the lead prosecutor in Swartz’ case, is no stranger to ruining young men’s lives. In 1994 Heymann prosecuted a student, also at MIT, for creating a bulletin board system which allowed users to trade copyrighted software (a precursor to the file-sharing networks common today). His case was dismissed on grounds that he didn’t intend to profit from the downloads, which prompted Congress to strengthen the CFAA to allow prosecution even if profit wasn’t a motive.
Heymann later won the conviction of 16-year-old Jonathan James, who had gained access to NASA and Department of Defense systems, and became the first juvenile to be incarcerated (via house arrest) for hacking. Heymann again targeted James in 2008, in an investigation of an identity theft ring tied to break-ins of department store networks. Although the Secret Service never found any evidence James was involved in the hacks, he killed himself in 2008, saying he had “no faith in the ‘justice’ system.”
Nor should anyone else, really. The system has never been about “justice,” and it seemed even less so in the circumstances surrounding Aaron Swartz’ case. This case was about projecting government power and crushing anyone who dared to upset the status quo, as Swartz often did. And anyone wishing to remain in the elites’ good graces — like MIT, and most other public research universities — had best do whatever is necessary to please their masters. And despite their pleas of “neutrality” in this case, MIT administrators did exactly that. They provided Heymann with every scrap of information they had about Swartz’ activities, usually with just a phone call. Bob Swartz pleaded with them to negotiate a settlement, asking: “Why are you destroying my son?” The school never gave him a satisfactory answer.
With the arrogance characteristic of state prosecutors, Heymann seemed shocked at Swartz’ temerity to fight the charges. Most outrageously, he likened Swartz to a rapist:
Negotiations continued, but in the end Aaron told Heymann no. He would fight the felony charges and go to trial.
Later, Heymann would tell MIT that he was “dumbfounded” by Aaron’s decision, and claimed that Aaron was “systematically re-victimizing” the university by choosing to go through proceedings. Publicly criticizing MIT at a trial, Heymann said, was akin to “attacking a rape victim based on sleeping with other men.”
If anyone was “raped” in this scenario, it was Aaron. Humiliated, cut off from many of his friends — his relationship with his girlfriend, Quinn Norton, ended after Norton tried to talk to Heymann and wound up giving the prosecutor a key piece of evidence against him — and seeing no end to the persecution, Aaron Swartz decided to end it himself.
In the end, there were no winners. No one was ever hurt by Swartz’ actions, no vital national interest served, no copyrights protected, no damage to repair. Instead the world lost a brilliant young mind who understood better than most the power knowledge has to liberate the world. Perhaps the state understands that too, which is why it tries so desperately to crush those who attempt to set it free.
Ponzi Argumentation: Gary North’s Rhetorical Mania
by John Mather
Gary North has responded to my article critiquing his assertion that Bitcoin is the largest private Ponzi scheme in history. North’s response is instructive as a lesson in rhetorical tactics. It doesn’t, however, redeem North’s faulty arguments against Bitcoin.
To summarize, North frames my article as a personal attack on him rather than a critique of his Bitcoin arguments. Then, despite saying he doesn’t know me, he condescendingly calls me a “kid” (untrue), a programmer (untrue), ignorant of the basics of debate (untrue), and a “space cadet” (I will let readers judge). He also uses the rhetorical device of repeatedly saying I’m digging a hole for myself. Repetition is an old technique employed by advertisers and politicians. Repeat a claim over and over in hopes that people will come to believe it’s true. All this rhetorical arm waving amounts to playground bullying rather than a substantive response to my critique.
A Bit of Progress
To North’s credit, he starts off by making a large concession to my critique. He drops the Ponzi scheme claim and titles his response, “Digital Tulips: The Bitcoin Mania.” He devotes the introduction to reframing the debate by giving historical context about tulip mania. He expresses discontent that I’ve held him to the actual definition of a Ponzi scheme, but “to keep Mr. Mather happy,” he agrees to abandon the Ponzi scheme framework. I doubt North is concerned about humoring me, but I’m delighted he has let go of the Ponzi scheme canard. This allows the discussion to move past Bitcoin being a scheme based on lies and deceit to a discussion about whether Bitcoin’s price volatility will drive it to what North claims is its value: zero. We are making progress.
Unfortunately progress halts after this concession, as North unfurls a raft of of rhetorical gambits which serve to distract rather than inform the reader about the substance of the debate. I will call them out one by one.
A Personal Attack!
North from the outset attempts to frame this debate about Bitcoin as a personal attack on him. He advertises his article on his home page by writing, “A young man decided to take me apart in full public view. This affords me an opportunity to have a little fun. . . ” I issued no personal attacks against North, and I have no need to do so. North of course has no idea what my age is, but by calling me “a young man” he can set up a “watch the old pro whip a young buck” rhetoric. North continues the personal attack frame-up in the body of the response: “His article is published on a site run by Jeffrey Tucker. Mr. Tucker was wise enough to get a stand-in for this hatchet job.” After characterizing my article as a “hatchet job,” North continues: “He dismisses me as if I am an economic ignoramus.” If I thought North an economic ignoramus, I would not have written the critique in the first place. In fact I explicitly stated, “North is widely recognized as an expert on Austrian economics, and I make no claim to the contrary.” The issue is that North does not understand Bitcoin, not that he does not understand Austrian economics. His ignorance about Bitcoin and misapplication of Austrian analysis to Bitcoin are the sources of my criticisms. His rhetorical maneuvers fail to refute them.
If North can reframe a substantive debate as a personal attack, then he can appear justified in taking a posture which is personal and aggressive. This is his strategy. By saying I’m a “stand-in” for a “hatchet job,” he is making a personal attack on me and Mr. Tucker. The fact is that I submitted this article, unsolicited by anyone, to multiple publishers. I did not know where it would be published, though Tucker’s role as former editor at the Mises Institute and publisher at Laissez Faire Books seemed like an appropriate choice given this issue is about Bitcoin and Austrian Economics. North’s discontent that the article was published publicly – “in full public view” – is odd. When people disagree with North’s public statements, are they obligated to respond only to him personally?
Argument from Age Fallacy
In addition to the personal attack framing, North several times commits the “argument from age” fallacy. Namely, because he’s older, he is therefore wiser and correct. For this trick to work, though, he must first frame me as being young. Hence he refers to me as “a young man” and a “kid” despite saying he’s never heard of me. I have far more gray hair than not, but that of course has nothing to do with the substance of the debate. I could be a teenager and be correct, or I could be older than North and wrong in all my arguments. North goes back repeatedly to the argument from age fallacy, ending his article with “Old timers can see what’s coming.” Old timers…. So that must settle it then? It would be equally silly to say old timers didn’t see the car replacing the horse and buggy, or word processors replacing typewriters. None of this is valid argumentation.
To recap thus far, he’s framed my article as a personal attack by a naïve youth who doesn’t know better. He pairs the argument from age fallacy with another effective rhetorical device: repetition. He continually issues “rules” as if to patronizingly share some tips with the young buck who dared challenge him. Saying over and over that I’m digging a hole for myself is not a valid rebuttal of my arguments. It’s up to readers to decide who is in a hole. Constant repetition by North that my arguments are weak, without actually demonstrating that they are weak, is not a refutation. It’s just a repetition gambit, and it distracts from the truth seeking process.
North’s first patronizing “tip” is to save the “rhetoric of condemnation for your conclusions.” Mr. North has not followed his own advice. He’s already framed this debate as a personal attack launched by a kid who has stupidly poked his stick in a hornet’s nest of truth. Now I must be schooled in a “let the old pro show you how it’s done” way. It’s clever posturing, and he closes his piece with a cute Youtube of an Alka-Selzer commercial to reinforce it. It all makes for good entertainment. The problem is, it’s just rhetorical arm waving.
Fiat Money ≠ Bitcoin
North says the heart of his article is that “fiat money is ‘spoken’ into existence. It is not money developed over centuries in market transactions.” He then equates Bitcoin to fiat money, calling it “wanna-be fiat money digits” that were “spoken into existence.”
This is blurry language that results in blurry thinking. Fiat money’s key distinguishing characteristic is that it is mandated for use by fiat. By state decree it must be accepted as money. Bitcoin is not issued by fiat, and it is not used by fiat. North seems bent on ignoring this distinction, but it doesn’t change the reality that people are using Bitcoin by choice and as an alternative to fiat money. Further, some fiat money in the past has been commodity backed and fully redeemable (alas no more), not “spoken into existence.” The fact that fiat money in the digital age can be instantly created at zero cost in any quantity (witness Japan’s quadrillion yen public debt) contrasts starkly with Bitcoin, which cannot be created instantly, is mined at the cost of enormous computing power, and is limited in total supply to 21 million bitcoins.
The fact that Bitcoin hasn’t “developed over centuries in market transactions” is simply not the crux of what determines whether or not it is a currency. People’s demand to use it as a currency is the crux of whether or not it’s a currency. It’s bizarre that North readily says that the US dollar is money, as if the fact that it used to have a commodity backing is the reason it is valued now. Most people today don’t know any monetary history at all, and they give no thought whatsoever about whether dollars (or any other fiat money) is commodity backed or not. North raises no objections to the other fiat currencies I mentioned as being money either, some of which have short histories and no commodity roots. How about the Euro, a total fiat creation hatched in 1999 with no history whatsoever of commodity backing?
“Out of Nothing”
North does not refute my point that Bitcoin is not made “out of nothing.” Instead he makes a pun about “specie” backing to avoid the fact that he’s made a specious argument. North wants to play word games by simultaneously defending fiat currencies as money while saying that any private alternative cannot serve as currency unless it has had centuries of market transactions. It’s simply not true, and North has not demonstrated otherwise. But to confuse matters more, he says, “I reject fiat currencies that are not the product of long years of use in the free market.” So he rejects them how? By refusing to use Euros in Europe? He wouldn’t get very far, but he at least could survive over there by using Bitcoin.
He continues to dodge the “out of nothing” argument by repeating that “Bitcoins were created out of nothing to perform a service.” At some point I hope he will recognize that the utility he derives from his website and his ability to write his articles and earn a living from his subscribers are all a function of software, none of which is made out of nothing, and all of which perform a service. Further, his computer’s processing power and the electricity it consumes is not “nothing” any more than the processing power and electricity that is used to mine bitcoins is nothing.
Fiat Currencies: Stable and Easily Used?
North makes the surprising claim that fiat currencies are stable: “My point is this: the volatility of Bitcoins’ price is an indication of why they will not replace central bank fiat currencies, which are easily used in trade, and which are — so far — stable in purchasing power.” North categorically ignores the numerous fiat currencies around the world which have imploded in his lifetime. Countless people have been financially wiped out by assuming the mindset of fiat stability. Here is a long list of examples.
Despite North’s US-centric frame of reference, he still ignores the 96+% devaluation my grandmother has suffered, and the 50+% devaluation since the 1980s. And we’re only a few years into the age of quantitative easing, so we can reasonably expect things to get much worse. Bitcoin has been more volatile than US dollars, as I’ve noted, but it doesn’t mean that fiat currencies are stable. It also doesn’t mean Bitcoin has to be more stable than the US dollar to serve as a currency.
North is also not giving a fair account about ease of use in trade compared to Bitcoin. I bank internationally, and it is very difficult to do so. Americans are barred from opening bank accounts in several countries due to FATCA and other reasons beyond the scope of this discussion. And even when Americans find an international bank who will do business with them, it can take months to open an account. Then once an account is open, you are charged fees for transferring money to the new account, and then fees again for exchanging your money to the local currency. With Bitcoin, this is all completely avoided. I can do business directly with any individual at any time, instantly. Furthermore, if you walk into a bank and ask for, say, $10,000 out of your account, there’s a good chance you will be denied, questioned as to why you want the funds, and have a suspicious activity report filed. This is not what I would characterize as “easily used in trade” when compared with Bitcoin.
False Dilemma: Bitcoin or US Dollar
North continues, “The market has determined that the dollar is money. It has not determined that Bitcoins are money.” Governments determine what is money by fiat, and the dollar is no exception. There are a mountain of different fiat currencies in small geographic regions with transaction volumes that are a minute fraction of the US dollar. I refer readers to this up-to-date list of 182 fiat currencies.
Yet North wants to make it seem like the choice is between the US dollar or Bitcoin, period. North ignores the fact that Bitcoin is international, and its use is not by fiat. Bitcoin may be in the same realm of the transaction volume of some of the small countries on that list of 182 currencies. As time goes on, it’s possible Bitcoin will achieve a transaction volume that exceeds several countries on that list. I don’t know, and neither does North. It’s a false dilemma to say Bitcoin can’t be a currency unless it’s more used than the US dollar. North does it anyway: “Which is money: dollars or Bitcoins? The answer is obvious: dollars.”
Rule: Value is Subjective
North then goes on to issue a “rule” to me – another rhetorical device which is an argument from authority fallacy – I’m an expert, therefore I’m correct – which has nothing to do with the issue at hand. He wrote in his original article, “Something that was valuable for its own sake, most likely gold or silver….” This statement implies gold and silver have intrinsic value, but he takes offense that I call him on it. He may have written a dozen books in the past on the subjective theory of value, but that is irrelevant to what he wrote in his article. It would have been constructive to simply say his choice of words is not what he meant and move on. Yet he says my criticism of him saying gold and silver are valuable for their own sake is an “attack on him” and “rhetoric” with “no supporting logic.” Here is another of North’s diversionary tricks: when you can’t refute an argument, dismiss the argument as rhetoric.
Network Effect: Programmer Jargon?
North seems to enjoy making assumptions about me. He appears to believe I’ve invented the term “network effect,” and that I am using it as a programmer. Neither is true. Network effect is a term used in economics. I refer North to the externality Wikipedia entry in which network effects are discussed. The entry also mentions Mises and Hayek, so I can assure North that no programming knowledge is necessary to understand it, despite him characterizing a network effect good as “programmers’ professional jargon.” I also refer North again to the network effect entry which begins, “In economics and business, a network effect (also called network externality or demand-side economies of scale) is the effect that one user of a good or service has on the value of that product to other people.”
In my distinction about network effect goods (and how money is one of them), he says I’m “beating a dead horse” with no actual refutation. I will take that as agreement. I do commit the error of making a typo on Carl Menger’s first name, to which North says I’m confused, despite the fact that I hyperlinked the name to the correct Carl Menger. My apologies for the typo.
Back to Ponzi-ville
Though North at first seemed content to drop the Ponzi scheme claim, he returns to it by saying that he never claimed Bitcoin was a fraud (“I said it was not a fraud”), despite calling it the largest private Ponzi scheme in history and saying the creator(s) of it have been “siphoning off” money. He does not address my actual point, and instead pulls out the “rule” rhetoric again: “I see. We should buy Bitcoins as money because Bitcoins’ creators imitated the State.” He continues to refuse to acknowledge the fundamental divide between fiat money which can be created instantly in any quantity and is foisted on the public by force, versus Bitcoin which is used voluntarily, has a hard limit on its quantity, and cannot be instantly created with a keystroke. The fact that I point this out in my original article he, amusingly, cites as proof that I’m using his argument against him. Of course if he had drawn these distinctions between Bitcoin and fiat money in the first place, I may not have felt compelled to write my critique.
News Flash: Bitcoins NOT Used in Market Exchanges!
North continues his argument from authority fallacy by offering up another rule, claiming I have erred by agreeing that money develops out of market exchanges. I maintain that Bitcoin is being used in market exchanges. He disagrees: “Bitcoins are not being used in market exchanges.” I of course can point to numerous market providers of products and services which accept Bitcoin. North could do his Christmas shopping on this site alone. I know people who exchange Bitcoin every day for various goods and services. He, on the other hand, makes the proclamation that they aren’t being used in market exchanges without offering any evidence whatsoever.
Further, North ignores the fact that as the price of Bitcoin rises, its purchasing power for goods and services increases. If you can acquire a desired good or service directly with Bitcoin, why exchange Bitcoin for a fiat currency to make the purchase? The only way to ignore this is to hold fast to the delusion: “Bitcoins are not being used in market exchanges.” I know people who pay rent with Bitcoin, buy food with Bitcoin, buy books online with Bitcoin, et cetera. North provides no evidence to the contrary.
“Nothing to Consume” and Circular Logic
North completely ignores my criticism of his statement that a good has to be consumed in order to serve the customer. Neither Bitcoin nor gold are consumed. Instead he falls back to repetition of the rule rhetoric.
Next North invokes a circular reasoning fallacy to avoid addressing the error in his statement that “the fundamental characteristic of money is its relatively stable purchasing power.” I again refer to readers to this list and his claim that fiat currencies are stable forms of money. Purchasing power of fiat money has and will continue to fluctuate, at times wildly and unpredictably. So it bears repeating: The fundamental characteristic of money is that it’s the most widely demanded good in an economy. The rising price of Bitcoin indicates that it’s being demanded more and more. North claims this is proof that it is destined to be worthless.
Gold and Price Volatility: Confusing Causality
North and I agree that gold is not money, but he implies that it’s because the price is volatile. My pointing out the move from $35 to $1,910 doesn’t dissuade him from recommending it as an investment. (I agree.) Yet he says the dollar is stable from year to year. Could the trillions and trillions of newly created dollars over the past few decades be accountable for gold’s massive price rise? What is stable, the ounce of gold which has forever been the same, or the US dollar as a measuring stick for that ounce of gold?
Bait ‘n’ Switch
North attempts a bait and switch regarding my explanation that because Bitcoin has no yield, we will only know in retrospect whether it’s in a bubble or in an adoption phase as a currency. He mistakenly tries to tie Bitcoin to real estate, which is a yielding asset. I wrote, “During the adoption phase of any good as money, the purchasing power rapidly increases from its initial value as a non-monetary good as more and more people adopt it.” Notice how North swaps in the word “fiat” for “good”: “He is making this up. There are no records of any such private fiat money in history. All fiat monies have been extensions of previous government money systems or a previous commodity standard.”
My point was straightforward, but I will step through it to dispel the confusion North attempts to create. If a person in a given economy believes that a good will be adopted as money, he may act on that speculation by purchasing the good in advance of it becoming money. If he is correct in his prediction, he will see that good rapidly increase in purchasing power as it becomes money. Why? Because that good is in the process of becoming the most widely demanded good in the economy, which is the definition of money. Bitcoin’s adoption as a borderless medium of exchange by more and more people around the world would cause its purchasing power to rapidly increase.
Ignoring Arguments is Not a Refutation
My comparison of the monetary traits of Bitcoin vs gold and silver is unaddressed by North in any substantive way. He quotes part of my comparison (and for some reason inserts “Conclusion” into my discussion of durability) without refuting any of it. But by now it’s easy to spot the tactic: do not address my actual arguments. Instead he says I’ve ignored “the entire history of monetary economies” without offering any basis or citing a single example. Rather than using this opportunity to discuss monetary history, as I did with the continual silver debasement of the Roman denarius, he avoids the entire discussion.
He then goes on to say that legal tender laws are irrelevant to the US dollar’s role as money. “No one has to accept them,” according to North. Here’s a dictionary definition of legal tender: “currency in specified denominations that a creditor must by law accept in redemption of a debt.”
Despite the barrage of rhetorical sound and fury pointed at me, the only valid criticism North offers of Bitcoin is its price volatility. Because it’s been volatile, he reasons, it’s not being used for market exchange, and therefore can never be currency. And because it can never be currency, he concludes, it is worthless and destined to collapse. (Interestingly, because of fiat price volatility, he doesn’t believe he’ll ever see gold used as money, despite serving as currency for centuries. He does not discuss why the price of gold has been so volatile in recent decades.) North also does not mention the long history of defunct fiat currencies which he would have designated as money before their implosion.
I maintain that we cannot know Bitcoin’s future. Its price ascent could be because it’s in a bubble, but it could also be indicative of its increasing adoption as a borderless currency alternative.
North criticizes me for not offering proof of the number of Bitcoin exchanges which take place, yet he claims without offering any proof that none are happening. I suggest he inspect the public ledger of Bitcoin transactions, and I suggest he Google vendors who are offering goods and services using Bitcoin. Perhaps he will also hear from readers who are using Bitcoin for market exchanges. To wit North, in one of his personal swings at me, says I’m a “space cadet,” perhaps without being aware that Richard Branson will be accepting Bitcoin on Virgin Galactic space flights.
My point after all this remains the same, and I repeat it as a non-programmer, non-kid, long-time investor in gold and silver: Gary North may claim the fate of Bitcoin is already sealed, but his arguments are not compelling. As I said in my original article, if Bitcoin becomes defunct, the cause will not be explained by North’s faulty arguments against it. For example, states could attempt to regulate Bitcoin out of use, even outlaw it. This a risk factor North does not mention. I’m open to changing my views, as we all should be, if shown better reasoning. Until then, North’s rhetorical bluster remains hollow. Here is my question for North:
John Mather is a fan of technology, gold and silver, Bitcoin, and Austrian economics.
Last month, I wrote in the Libertarian Standard about Twilight Zone creator Rod Serling and the end of the Golden Age of Television — and about Serling’s preference for government interference over that of the advertisers.
Last week the Freeman published my article "TV’s Third Golden Age," about our present era in which quality dramas are moving from cable TV to the Internet, where they finally enjoy less interference from both advertisers and government regulation. The Internet is freer than television ever was.
In that article, I also give a little more background on JFK’s assault against the TV industry and how the deregulation trend of the 1970s and ’80s produced TV’s second "golden age." (Can you guess what brought it to an end?)
Having just returned from the annual meeting of the Property and Freedom Society in Bodrum, Turkey, Cantor wrote this wonderful reply (which I quote with his permission):
This is a terrific article and thanks for sending it to me (and mentioning me in it). I’m glad to see that Thompson seems to be on board with us on these issues. I own his book but haven’t read it yet. It’s nearing the top of my "to read" pile, and you’ve pushed it up a few places. It’s good that we’re not alone on these issues.
As I recall what you wrote about radio, all this could have happened back in the 1920s if a subscriber model had been adopted for radio instead of the broadcasting model. Essentially, we’re finally getting where we should have been in the first place — real consumers for TV. I notice that young people now have no interest in seeing TV as broadcasted. They want direct access and know how to get it. When I was at Hans-Hermann Hoppe‘s recent conference in Turkey, I was amazed at how current the young people from central and eastern Europe were with American TV — maybe one episode behind on BREAKING BAD. When I asked: "Is BREAKING BAD broadcast in your country?" they stared at me as if I were saying: "Do dinosaurs still roam the plains of Poland?" They were getting the show — well, frankly, I don’t know how they were getting the show, but it was definitely online and quite possibly illegal.
I shared a draft with a writer friend of mine over the weekend. She is far more educated and literary than I am. She saw a parallel between the opening scene and the larger story that I confess I was not conscious of. I thought I’d just been going for sex appeal.
Here’s more of the opening:
She is not called Lamarr yet. That name will come later, in Hollywood. For now she is still Hedwig Kiesler, a Viennese teenager in Prague, playing her first starring role in a feature film, Ekstase (“Ecstasy,” 1933). The controversial Czechoslovakian film will become famous for Hedy’s nude scenes (which are not sexual) and its sex scenes (which show only her face, in close-up, in the throes of passion).
The film will give Hedy her first taste of fame. She will be known as the Ecstasy girl. An Austrian director will tell the press, “Hedy Kiesler is the most beautiful girl in the world.” Later, MGM movie mogul Louis B. Mayer will repeat the claim, using the name he insisted she change to: Hedy Lamarr.
But while the world of her time will remember her for her photogenic beauty, history will remember her as the inventor of frequency hopping, the foundational technology of today’s mobile phones and wireless Internet. [FULL ARTICLE]
The piece goes on to explain how Hedy invented frequency-hopping spread spectrum during World War II and why it took so long for that invention to usher in the wireless Internet age. Short answer: the government kept the technology secret for decades. Not only did Hedy Lamarr not see a cent from her invention; she didn’t even get credit for it until the end of the century.
So here’s what my writer friend said:
The more I think about it, the movie image you start with — Hedy looking at her runaway horse and thinking, ok now what? is exactly what you describe in your title: Hedy Lamarr on hold. She’s on hold in the movie (for a moment, I guess — given the movie title, I imagine that she’s not alone for long) and then her invention is on hold for a much longer time. … A Hollywood starlet and inventive genius who made millions in the market surrendered her most innovative idea to Leviathan, who stifled it. And she did so, ironically, because of a lack of imagination on her part — a naive faith that the state would protect and serve its citizens.
(By the way, I’m especially pleased that FEE decided not only to feature my article but also to use the image I put together for it!)