We often encounter Bitcoiners who assert that Bitcoin is unstoppable and has already “won.” We happen to agree with them. But the endgame has yet to play out, and it still has two potential paths. One is easy; the other is hard.
On the easy path, positive narratives about Bitcoin outweigh negative ones. We experience a peaceful mass adoption process based on people’s expectations for huge individual and societal benefits of money that is hard to print, censor or steal. This is the path we seem to be on here at the beginning of 2021 as regulatory barriers fall and Bitcoin’s popularity rises.
But the hard path also remains open to us. On this path, Bitcoiners become vilified as self-righteous and arrogant winners who are identified with the phrase “have fun staying poor” and find themselves resented or even attacked by their less-fortunate neighbors.
One of us believes that the hard path is more likely than the easy one. Regardless of the probabilities of each path, we want Bitcoin and Bitcoiners to take the easy path, and if we can increase the probability of that outcome by even one percentage point, it will be worth the effort. Toward this end, we have concluded that pursuing the easy path requires some understanding of human psychology that we only recently discovered.
Inspired by research done by cultural anthropologist Richard Shweder, psychologists Jonathan Haidt, Craig Joseph and Jesse Graham developed the “moral foundations theory.” Like any psychological theory, it must be taken with a large grain of salt. But Bitcoin proselytizers can learn something from it that may help them push Bitcoin onto the easy path rather than the hard one.
The basic idea behind the theory is that most human action is driven not by cold, calculating, rational behavior such as might be observed in the fictional “homo economicus.” Instead, our intuition drives our actions, and logical reasoning follows such intuition. To illustrate the idea, the psychologists invoke an image of an elephant with a rider on top. The elephant represents our human intuition, which is generally the driving force of our actions. It represents patterns of thinking that proved adaptive as humans evolved and competed to survive. While the logically-reasoning rider can influence the elephant, once the elephant starts moving in one direction, it gains momentum that is difficult for the rider to reverse. It becomes easier for the rider to construct logical arguments that justify the direction in which the elephant is already moving.
The psychologists cite evidence for six primary foundations of the driving intuition. These foundations are (1) care/harm, (2) fairness/cheating, (3) loyalty/betrayal, (4) authority/subversion, (5) sanctity/degradation and (6) liberty/oppression. Each foundation is believed to be rooted in social dynamics selected for by evolution. In The Righteous Mind (2012), Haidt applies the six foundations to politics and uses the framework to explain why conservatism in the U.S. has proven surprisingly resilient, since it draws on all six of the foundations, while liberalism draws primarily on just two (care/harm and fairness/cheating).
Just as Haidt recommends that political leaders attempt to appeal to as many of the six foundations as possible when selling their policies to the public, Bitcoiners would be wise to base their narratives around Bitcoin’s benefits for both individuals and society on as many of the six foundations as possible. Each of the following six sections includes for each of the foundations (1) a direct quote from The Righteous Mind, (2) an example in bold/italics and (3) our thoughts on how the foundation maps onto Bitcoin.
“The Care/Harm foundation evolved in response to the adaptive challenge of caring for vulnerable children. It makes us sensitive to signs of suffering and need; it makes us despise cruelty and want to care for those who are suffering.”
The Righteous Mind, page 178
We react viscerally when a defenseless creature (especially a child) is threatened with harm.
The clearest negative Bitcoin narrative sitting on the care/harm foundation is global warming. Bitcoiners are only too familiar with the “Bitcoin will boil the oceans” criticism, and it requires a strong response.
Neoclassical economics suggests that government policies are the solution to the “negative externality” of greenhouse gasses. Such solutions come in two major categories: “sticks” and “carrots.” The “sticks” category includes taxing carbon emissions and limiting total emissions quantities (e.g. “cap and trade”). In the “carrots” category are subsidies paid to manufacturers and purchasers of solar panels, wind turbines and batteries, as has occurred with Tesla.
In our view, policies involving “sticks” are mostly doomed in the long run. That’s because a large portion of the world’s greenhouse gas emissions today and in the next decade will come from poor and middle-income countries. Think coal plants in China and India (which belch huge amounts of carbon) and deforestation in Brazil and Indonesia (which releases carbon and destroys carbon-capturing vegetation) to provide pastures for methane-emitting livestock.
For countries like these, policies to limit or tax carbon emissions just don’t compute. Their leaders must prioritize lifting the masses out of poverty as soon as possible. Making energy more expensive via taxes or emission caps makes this harder. Moreover, rich countries already got to emit multiples more tons of carbon per citizen alive today as they industrialized and built wealth over the last two centuries. Granting the same opportunity to poor countries to catch up to rich ones involves a lot more carbon emission per citizen in these countries. From a fairness perspective, rich countries who want to convince poor ones to emit less don’t have a leg to stand on unless they are prepared to write gigantic checks. And many of the biggest rich countries can’t even agree on policies to limit their own emissions, much less subsidize clean energy in developing nations.
So, if sticks are out, then we are left with carrots, and the relevant one is subsidizing the development of cheaper green energy. Specifically, the subsidy needs to drive down the cost of production of clean energy toward zero. When a technology is in its infancy, it can make sense for the government to pay outright for research and development. ARPANET, an important precursor to the internet, is a classic example.
But once a technology can be turned into a usable product, private enterprise takes the reins. That’s where Bitcoin is today. Since electricity can’t efficiently travel farther than a few hundred miles, the majority of the potential solar and wind assets on earth are stranded — think uninhabited deserts and breezy regions of the oceans. But Bitcoin mining allows these otherwise-inaccessible assets to be brought online, since all that is required is an internet connection and basic utility support. Remote but otherwise ideal sites for renewable energy production suddenly have a ready use for their potential production, in the form of locally-sited bitcoin mining facilities. Sites that would be economically infeasible due to their excessive distance from population centers can now be profitably developed.
This increases the units of solar panels and wind turbines sold globally. The extra sales increase the manufacturers’ revenues, which increases their profits, which funds their research and development budgets. This brings down the average cost of production for solar and wind capacity, which unlocks more stranded renewable resources, which drives research and development, and the virtuous circle drives renewable energy costs toward zero. This same pattern has played out in numerous other industries, and renewable energy should be no different. Indeed, as Conner Brown articulates in Bitcoin: A Bold American Future, this process could lead to both energy independence at the national level, and a permanent recession in hydrocarbon-based energy production.
Bitcoiners need to educate people on this topic and avoid beginning passively on the back foot. Whenever talking to someone who is concerned with Bitcoin’s environmental effects, it may make sense to lead with this question: “Could you please explain to me how we’re going to defeat global warming without Bitcoin?” (I.e., defend your doomed sticks arguments, and I’ll respond with my Bitcoin carrot.)
“The Fairness/Cheating foundation evolved in response to the adaptive challenge of reaping the rewards of cooperation without getting exploited. It makes us sensitive to indications that another person is likely to be a good (or bad) partner for collaboration and reciprocal altruism. It makes us want to shun or punish cheaters.”
The Righteous Mind, page 178
Most people care a lot about fairness, such as taking more than your fair share or cutting the line.
Most Bitcoiners we know (ourselves included) believe that Bitcoin will be enormously beneficial to society in the long run. Understanding this thesis in full requires reading Jeff Booth’s brilliant book The Price of Tomorrow (2020). In a nutshell, technology, entrepreneurship and economic progress are all about making things better, faster and, especially, cheaper. Home lighting, long-distance transportation, communication and computation have all become orders of magnitude cheaper over time. So, in the long run, consumer prices experience deflation in an advancing economy — the consumer’s basket of goods and services gets cheaper. This makes consumers effectively richer and better-off since their money buys more.
Yet the central bankers tell us we must have inflation. So, they vainly swim against the natural deflationary current, print money, lower interest rates and cause the giant debt bubbles we observe today. Bitcoin fixes this. It delivers a deflationary money to match the natural state of any successful economy: consumer price deflation.
But in the short term, Bitcoin has a perception problem regarding fairness. Many people still view Bitcoin as a typical pyramid scheme in which the early adopters benefit disproportionately and get rich on the backs of the latecomers. Never mind that the early adopters suffered ridicule, hostility and gut-wrenching price volatility. Anyone who has experienced the vicissitudes of a multi-year Bitcoin bear market has likely suffered enough psychological pain to “earn” his/her Bitcoin fortune. But the uninitiated will struggle to understand this. Moreover, the latest wave of billionaires and wealthy investors accumulating Bitcoin does not help the fairness narrative because many will now argue that Bitcoin has been captured by the rich.
Making the world safe for Bitcoiners will therefore require that we convince skeptics of the long-term societal benefits of Bitcoin while highlighting that the concentration of Bitcoin ownership is not significantly worse than any other capitalist enterprise (with Exhibit A being the concentrated shareholdings of the giant internet companies) and that most already-rich people who got into Bitcoin came to the party relatively late. Moreover, people who hold lots of Bitcoin today will likely peel some off over time as the price rises, just as shareholders of successful companies do.
Helping skeptics understand the societal benefits of Bitcoin requires explaining how debt-fueled economies lead to (1) unnecessary overconsumption, (2) disincentives toward saving (as saved money loses purchasing power over time) and (3) capital misallocation and destruction as large enterprises that should fail are propped up, while job-creating startups struggle to compete.
“The Loyalty/Betrayal foundation evolved in response to the adaptive challenge of forming and maintaining coalitions. It makes us sensitive to signs that another person is (or is not) a “team player.” It makes us trust and reward such people, and it makes us want to hurt, ostracize, or even kill those who betray us or our group.”
The Righteous Mind, page 178
People can behave violently against their competitors, but a special level of retribution is often reserved for “traitors” to the group.
We can see both a pro-Bitcoin and an anti-Bitcoin narrative resting on the loyalty/betrayal foundation. Having made his career in the legacy financial system, Andy has no doubt that his support of Bitcoin, coupled with his criticism of the banking industry, has alienated some of his friends and contacts who are still part of the legacy system. Given the number of people employed in legacy finance broadly (banking, wealth management, insurance, etc.), there is a significant cohort of people who stand to lose (at least on a relative basis) from Bitcoin’s rise. The “sanctity” of the existing legacy financial system is therefore under threat, and it may hit back.
Conversely, those of us who have gone to great lengths to educate our family and friends about Bitcoin have succeeded in helping some of them to profit from Bitcoin’s growth. Nothing creates bonds of trust, loyalty and gratitude like helping people we care about to use a tool that provides them with financial security. These “tribes” of people are potentially a strong grassroots effort that fosters strong ties of loyalty and support for the larger superstructure of Bitcoiners globally. We must all continue to help the people we value to understand Bitcoin and use it for the betterment of their social circles.
“The Authority/Subversion foundation evolved in response to the adaptive challenge of forming relationships that will benefit us within social hierarchies. It makes us sensitive to signs of rank and status and to signs that other people are or are not behaving properly given their position.”
The Righteous Mind, page 179
Most people respect authority and care about maintaining order.
Of the six foundations, this is Bitcoin’s weakest. For the significant portion of humanity that is inclined toward respect for authority, Bitcoin can at first look like toxic waste. Bitcoin aims to challenge governments’ ability to control money, which is the opposite of what we might expect the typical rule-following citizen to support.
In this category, Bitcoiners will have to lean on the sad fact that governments have printed their currencies into oblivion and inflated the largest debt bubble in history in order to maintain the debt and government entitlement Ponzi scheme. We will have to highlight the failings of the existing monetary system in a way that makes it unavoidably obvious to anyone listening. Fortunately, the government has already done most of the work for us, and it is likely to continue to do so. All we have to do is amplify the existing signal.
Moreover, there are already numerous books, articles, videos, podcasts and other media that support the case that a world that prominently features Bitcoin will be more orderly than a fiat-based one . For every skeptic of non-state-sponsored money, there are likely several pieces of content that will resonate.
“The Sanctity/Degradation foundation evolved initially in response to the adaptive challenge of the ‘omnivore’s dilemma’ and then to the broader challenge of living in a world of pathogens and parasites. It includes the behavioral immune system, which can make us wary of a diverse array of symbolic options and threats. It makes it possible for people to invest objects with irrational and extreme values, both positive and negative, which are important for binding groups together.”
The Righteous Mind, page 179
Cultures, religions, and societies sanctify certain things, such as religious structures, relationships such as marriage and the human body.
We can see both a pro-Bitcoin and an anti-Bitcoin angle on the sanctity/degradation foundation. For some people, government money may be a somewhat hallowed concept. Certainly, governments are adept at wrapping money into prideful nationalism.
The U.S. government makes every effort to associate money with sacred images and symbols. On the $1 bill we see the American bald eagle; the Eye of Providence; the image of the country’s venerated first president, George Washington; and the words “in God we trust.” What any of these things has to do with good money is questionable, especially since the currency’s ongoing debasement means that a dollar bill doesn’t buy much anymore. But the sheer repetition of exposure to such imagery must cause some mental association between the dollar and sacred imagery and concepts. Perhaps this helps explain many people’s initial hostility to Bitcoin, since it is perceived by some as a threat to the hallowed dollar.
On the other hand, Bitcoin’s “immaculate conception,” Hollywood-script-quality origin and growth story, and zealous supporters all imbue Bitcoin with a sacred aura. We believe that with careful attention to important “rituals” like running a full node, custodying our own private keys, and spreading the Bitcoin “gospel” to others, Bitcoin can achieve sanctity in the minds of the masses.
“The Liberty/Oppression foundation…evolved in response to the adaptive challenge of living in small groups with individuals who would, if given the chance, dominate, bully, and constrain others. The original triggers therefore include signs of attempted domination. Anything that suggests the aggressive controlling behavior of an alpha male or female can trigger this form of righteous anger, which is sometimes called ‘reactance.’ That’s the feeling you get when an authority tells you that you can’t do something, and you feel yourself wanting to do it even more strongly.”
The Righteous Mind, page 200
People in free western societies, especially the United States, value liberty highly, and they frequently react with righteous hostility when their freedoms or those of others are infringed upon.
Among the six foundations, liberty is Bitcoin’s true cornerstone, and it is the one on which Bitcoiners must lean hardest. Money that is hard to print, censor or steal is a powerful tool for liberty and against oppression. Whether storing value from corrupt regimes in hyperinflationary countries or escaping oppression by safely crossing borders with one’s savings in a brain wallet, Bitcoin resonates strongly with anyone who values liberty.
In a world in which governments and companies continually encroach on personal liberties via surveillance and outright control, Bitcoin shines like a beacon of freedom. This is an especially potent narrative for anyone living in a western democracy that places a high value on liberty. As residents of societies that value freedom, we will be leaning especially hard on the liberty foundation.
Until very recently, many of us Bitcoiners have relied too heavily on our logical, rational minds when trying to get people interested in Bitcoin. How many more people could we have reached earlier if we had invoked the moral foundations theory for understanding human motivation?
While this framework may not be perfect, we believe it can be a potent tool for winning the hearts and minds of the masses and traveling the easy path to Bitcoin adoption. This path may still be long, but it promises to be less arduous than the alternative. Will you join us?
This is a guest post by Andy Edstrom and Peter McCormack. Opinions expressed are entirely their own and do not necessarily reflect those of BTC Inc or Bitcoin Magazine.
The post Winning Hearts And Minds For Bitcoin – Bitcoin Magazine appeared first on TechFans.