I first read — and shared highlights from — Sovereign Individual in 2017. You can see them here.
Recently, as part of my process to review a bunch of old notes and learnings, I re-read all of those old highlights and whittled down further to a few current faves.
It’s still remarkable to me, how prescient and farsighted the authors were about future geopolitical conflict. The book came out in 1997 — before bitcoin, before en masse labor offshoring, before Trump & Jan 6, before the rise of China, before trillion dollar publicly traded tech companies, before multi-trillion dollar government deficits.
Of course they didn’t get everything right, but enough to matter. I believe it’s because they had a rather unique analytical framework: Attempting to understand how violence (both offense and defense) changes at the margins.
SOVEREIGN INDIVIDUAL HIGHLIGHTS (all verbatim, all mistakes mine):
The lamb and the lion keep a delicate balance, interacting at the margin. If lions were suddenly more swift, they would catch prey that now escape. If lambs suddenly grew wings, lions would starve.
The capacity to utilize and defend against violence is the crucial variable that alters life at the margin.
The Church was the main source for preserving and transmitting technical knowledge and information. The Church sponsored universities and provided the minimal education that medieval society enjoyed. The Church also provided a mechanism for reproducing books and manuscripts,
Farming created stationary capital on an extensive scale, raising the payoff from violence and dramatically increasing the challenge of protecting assets. Farming made both crime and government paying propositions for the first time.
People had minded less giving their money to the Church when there was no other outlet for it. But when they suddenly saw the chance to make one hundred times their capital financing a spice voyage to the East, or get a lesser, but still promising sum of 40 percent per annum financing a battalion for the king, they understandably sought the grace of God where their own interests lay.
Suppose the phone company sent a bill for $50,000 for a call to London, just because you happened to conclude a deal worth $125,000 during a conversation. Neither you nor any other customer in his right mind would pay it. But that is exactly the basis upon which income taxes are assessed in every democratic welfare state.
Most democracies run chronic deficits. This is a fiscal policy characteristic of control by employees. Governments seem notably resistant to reducing the costs of their operations.
A delicate etiquette shrouded straightforward analysis of labor relations during the industrial period. One of its pretenses was the idea that factory jobs, particularly in the middle of the twentieth century, were skilled work. This was untrue. Most factory jobs could have been performed by almost anyone capable of showing up on time. They required little or no training, not even the ability to read or write. As recently as the 1980s, large fractions of the General Motors workforce were either illiterate, innumerate, or both. Until the 1990s, the typical assembly-line worker at GM received only one day of orientation before taking his place on the assembly line. A job you can learn in a single day is not skilled work.
governments have never established stable monopolies of coercion over the open sea. Think about it. No government’s laws have ever exclusively applied there. This is a matter of the utmost importance in understanding how the organization of violence and protection will evolve as the economy migrates into cyberspace, which has no physical existence at all.
Paper money is a distinctly industrial product. It would have been impractical before the printing press to duplicate receipts or certificates that became paper currency.
This new digital form of money is destined to play a pivotal role in cybercommerce. It will consist of encrypted sequences of multihundred-digit prime numbers. Unique, anonymous, and verifiable, this money will accommodate the largest transactions. It will also be divisible into the tiniest fraction of value. It will be tradable at a keystroke in a multitrillion-dollar wholesale market without borders.
As documented by Professor Roy W. Jastrom in his book The Golden Constant, gold has maintained its purchasing power, with minor fluctuations, for as far back as reliable price records are available, to 1560 in the case of England.
‘If the world operates as one big market, every employee will compete with every person anywhere in the world who is capable of doing the same job. There are lots of them and many of them are hungry.” ANDREW S. GROVE, PRESIDENT, INTEL
the true obstacle to development in backward countries has been the one factor of production that could not be easily borrowed or imported from abroad, namely government.
We also suspect that nationstates with a single major metropolis will remain coherent longer than those with several big cities, which imply multiple centers of interest with their various hinterlands.
Every human on earth could be packed into Texas, with each family living in its own detached house with a yard, and still have some of Texas left over.
New survival strategies for persons of lower intelligence will evolve, involving greater concentration on development of leisure skills, sports abilities, and crime, as well as service to the growing numbers of Sovereign Individuals as income inequality within jurisdictions rises.
Shaw and Wong focus on five identification devices used by modern nationstates to mobilize their populations against out-groups. These are: 1. a common language 2. a shared homeland 3. similar phenotypic characteristics 4. a shared religious heritage and 5. the belief of common descent
As Tudge elaborates in describing the “extreme generalness” of human beings: “We are the animal equivalent of the Turing machine: the universal device that can be turned to any task.”
By eliminating the beneficial impact of competition in challenging underachievers to conform to productive norms, the welfare state has helped to create legions of dysfunctional, paranoid, and poorly acculturated people, the social equivalent of a powder keg.
A system that routinely submits control over the largest, most deadly enterprises on earth to the winner of popularity contests between charismatic demagogues is bound to suffer for it in the long run.
Like most elites, the cognitive elite tend to be a bit above themselves, are rather arrogant, and think they can set their own standards. They are alienated from society as a result.
In science, three thousand years completely changed what human knowledge is; in morality, we may actually have fallen back. The average psychotherapist probably gives the patient less good moral adviceon how to lead his life than the average Jew would have received from his teacher in the period of Moses.
The morality of the Information Age applauds efficiency, and recognizes the advantage of resources being dedicated to their highest-value uses. In other words, the morality of the Information Age will be the morality of the market.
Because incomes for the very rich will rise faster than for others in advanced economies, an area of growing demand will be services and products that cater to the needs of the very rich.