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Scott Alexander on Sam Bankman-Fried, FTX and Effective Altruism

astralcodexten.substack.com

I made this a top level post because I think people here might want to discuss it but you can remove it if it doesn't meet your standards.

Edit: removed my opinion of Scott from the body

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Many rationalists support crypto because they consider that it will help to avoid government control to buy nootropics, participate in prediction markets etc. My advice is that instead of supporting crypto it is better to lobby politicians to allow to do these things legally and openly. That may take longer time and be harder to achieve but it will be much better because negative externalities from crypto are too severe and damaging that they cancel all the benefits that crypto could give us.

Many of these things are legal in other countries and they are not as great as many rationalists think. I am in Latvia now; piracetam and phenibut are manufactured by a local pharmaceutical company here, they are not only legal but doctors routinely prescribe them. What I think about them is that their effectiveness is very low. Healthcare professionals consider them as low class antidepresants/anxiolytics. They have very few adverse effects but basically they do very little.

If 50% of antidepressant effect is due to placebo effect, then prescribing something to people with moderate depression/anxiety will have 50% improvement rate. Doctors initially select medicines with less side-effects and switch to more serious antidepresants when they are not effective. It would be good if other countries used them as well but in the big scheme, they matter very little that it is not worth to use crypto to illegally buy them.

piracetam and phenibut

prediction markets

Are you for real?

No, I need crypto to move assets out of an authoritarian country, to buy actual illegal drugs and VPN and bulletproof servers, to fund people doing unapproved research and in the extreme case, assassinations. I cannot rely on «lobbying politicians» who can easily score political points with the 95 IQ hoi polloi by throwing them some witches or saying they're «thinking of the children» or some such. No polity is deserving of my trust and vulnerability.

Societies with very well tracked money tend toward tyranny since Spartan times, and tyranny tends toward tracking of money streams; your approach is entirely dependent on trusting democratic procedures, but that is obviously impotent past some points of no return which are easily reached. This clown world logic of «let's force people to do everything in the public sphere instead of running underground, then they will negotiate a better equilibrium» is either naive or just a cynical cover for totalitarianism with extra steps. Likewise for its variations – let's disarm people so they become more active in civil politics and such. Let's prohibit medicine to promote healthy lifestyles while we're at it.

In reality, the absence of privacy, freedom to change one's state, and tools of personal agency such as weapons and means of exchange, reinforces the dominance of incumbent players, by shortening the feedback loop. It takes away the chances of small players to prepare something and come to the table with solid counteroffers, and rewards them for just shutting up and accepting the mainstream position, wherever it originates.

negative externalities from crypto are too severe and damaging

I believe that the emergence of domesticated peoples who can trust the polity is already a massive negative externality of economies of scale and organized state violence, and a dangerous step towards the eusocial attractor. It's incomparably worse than a little crime and some modest waste of electricity.

Thanks. I can better understand the mind of crypto supporters.

I am not completely naive and understand that any government can become totalitarian very quickly. The recent pandemic is a prime example – how leaving your home to have a walk in a park suddenly became a punishable offence. And at that time I was in Spain that is known for quite liberal attitudes and yet the police stopped me to check if I really had a receipt from the closest grocery shop to justify my walk outside. I won't even start with vaccine mandates and other restrictions.

I just don't see how crypto can help. I only see that it is even more important to work collectively even now to maintain democratic norms, to allow debate and free choice. Pandemic restrictions were supported by majority of population, so it is not only the problem of politicians turning totalitarian but the lack of understanding and information by the whole population.

The same advice I give to those who already live in countries that are slowly turning totalitarian like Russia. People should be more active in re-establishing democratic norms instead of working on crypto. It was unfortunate that Iranian emigrants are capable of much wider protests abroad than Russian ones.

We had large protests years ago, to no avail. Bluntly, we shouldn't have bothered with protests at all. They are an instrument of negotiation within an already-mature democratic polity where the power has not separated substantially from the populace, and within its Overton window at that. They do not work against an entrenched, well-armed and competent (at this sort of thing) regime, and Russia routinely devolves into a state with such a regime. What we should have bothered with instead are kamikaze drones, and setting siloviki houses and cars on fire, like Ukrainians do with Kremlin appointees. That had worked once – for good or for ill. And crypto would have helped, but for the unwillingness to seriously try – because it's the only reliable means to transfer value untraceably over long distances, that's available to commoners and not just mafia.

I'm still kicking myself about it. Hopefully other people around the world take notes.

@crushedoranges speaks of serious no-nonsense men who don't fiddle around with crypto and, when totalitarianism approaches, take out cash etc. etc. Very cool – in a decade they'll be as weird as crypto enthusiasts if not more. Governments promoting Central Bank Digital Currencies, and nice organizations coordinating deplatforming on Paypal and other centralized platforms, will see to it. And you'll learn, too, that banknotes are unhygienic (do you want to kill granny?!), wasteful, enable criminality and so on; and seeing the cost of resistance and hurdles to financing and lobbying it, it may be that you'll learn to very sensibly repeat this received wisdom.

In my opinion, those serious men with their unwillingness to master even layman-friendly tech are fetishistic LARPers of a bygone era, coelacanths who exist solely at the sufferance of their regime and are unable to mount any organized resistance; as an untraceable means of exchange crypto is strictly superior to cash, allows more freedom, and for anyone with half a brain and serious concern about coercion the implication is clear.

I agree that protests sometimes have very little success or no success at all in near term. However, with time they can change collective minds more effectively than armed resistance. After the WWII many Latvians took the arms and waged guerrilla war against Soviet occupation (fondly remembered as Forest Brothers). They failed and had no impact at all. What changed everything was Gorbachev's glastnost (openness) policy, people were allowed to talk freely and they decided that they don't like the Soviet system anymore. Despite what you read in history books, that was the main reason why the Soviet Union ceased to exist.

Today I learned from my aging mother that during WWII as a small child she was a refugee in camps in Germany. She might remember some details wrong but when the war ended they were let out and they had to decide: stay in Germany or go back to Latvia. She said that they had no information, no understanding about global things and they were afraid to stay in Germany (after all, Germany had started the war), so they decided to return to Latvia. Today it sounds like a monumental mistake considering that Latvia remained occupied by the Soviet Union and how different the post-war development turned to be. This just illustrates that sometimes people make bad choices because genuinely they don't know better.

Ukraine is again a good example of that as well. Areas with greater Russian loyalties are much easier to conquer by Russia. Ukraine is in a bad shape but encroaching totalitarianism is much worse with potentially poor future outcomes. Beliefs that people have in Russia about the west are main reason why this war is happening at all. Protests can nudge people to change their minds better than weapons.

What changed everything was Gorbachev's glastnost (openness) policy, people were allowed to talk freely and they decided that they don't like the Soviet system anymore.

But that ultimately reveals the answer as to why the Soviet Union fell: for one critical moment, the Russians lifted the boot.

Fast-forward 30 years, and now everyone there is clamoring for re-application of said boot.

Not everyone, only people who are misinformed.

The communist party tried to put the lid back and a coop was staged against Gorbachev and army units were sent to the Baltic countries etc. They failed because people were not afraid to talk about it anymore.

I don't know why Russians willingly blinded themselves afterwards. Of course, it was the government that gradually started to control information and played on their nationalistic feelings. Most people who support Putin, do it because they favour Russian supremacy, they want to feel that Russia is the greatest nation on earth. Globalization robs you of that. As many critics say that people in the European Union have lost their roots and exchanged their culture to material goods. When one sees oneself as a true carrier of civilization and the rest of the world as rotten, one can justify all brutalities in Ukraine.

But the reality is that Russian culture is nothing special, based on the same things that people value all around the world.