Comment by nostrademons | Hacker News Reader

Comment by nostrademons | Hacker News Reader

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I'm talking about "credit" in the David Graeber sense, where people effectively just remember who has done good things for them and reciprocate, not in the modern sense of credit cards and bank accounts. They're connected, but the former is more general.

I do think that the development of currency is intimately connected with the development of government. The core problem government solves is dispute resolution, and I would bet that the majority of disputes come from transaction where one side does not hold up their end of the bargain. In small communities you just have the tribal elders adjudicate, but as you start doing more currency transactions between mutually-distrusting groups that can't agree on their authority figures, you need a system in place for dispute resolution. Cue states.

My point is simply that currency comes first. State formation is a consequence of extended trade networks transacting with currency, currency and trade is not a consequence of state formation. To my knowledge this is historically accurate, and there are a lot of examples of currency spontaneously arising without a state to back it.

Hell, cryptocurrency itself is a good example. We now have a viable transnational, trustless, instantaneous currency. We do not have a viable transnational trustless dispute resolution process. And we very much feel the lack, because crime and fraud is rampant in cryptocurrency transactions. Currency creates the problem that government solves. Creating a government that can go along with cryptocurrency is an unsolved exercise left to the reader.

It's interesting, your point makes sense with the caveat of a blurring of terms.

I mean in the sense of, state formation was of such significance that I don't think you can say something like "currency came first" as if currency prior and post state formation is the same thing. It feels like the same sort of "pseudo-currency" with "currency" equivocation.

So if your model is - basic credit in that communal reciprocative sense, then you start trading with more distant outgroups, for this credit doesn't work, so everyone agrees on a currency, someone off in the distance doesn't agree, then states form to adjudicate disputes.

Then it is sensible as a primitive model, but I would just merely suggest that in the same way trying to say currency comes first is kind of a blurring the meaning of currency perhaps to the point of being a stretch, I think in this case to, it will be less orderly. One way this is blurred almost intrinsically in your articulation is via the term dispute resolution process. This could mean anything. It occurs to me that outright conquest and banditry is one way to resolve a dispute. Perhaps in places were there was "spontaneous" centering around a particular currency, this sort of violence was a predicate. I tend to think the need for violence and domination (and mitigations against the same) - what I think of when I think of states "resolving disputes" - was baked into the germ of humanity much earlier than what we might term "state formation". This gets back to the "pseudo-government" point I was trying to make earlier. I think of these things in parallel, rather than in sequence. If at their core humans are violent, such that they make violence, fear violence, and seek tradeoffs to manage violence, then this violence is a driver across currencies and states and trade networks, regardless of a determination of which "came first", if such a determination is even meaningful without greater specificity.

Similarly, I'm not sure if "State formation is a consequence of extended trade networks transacting with currency, currency and trade is not a consequence of state formation" is accurate in the same way. I suppose we have to unblur what "state" means.

I thank you for the back and forth though, which I enjoyed. I feel a need to do more reading on this topic, though I would guess much of these questions are not really falsifiable, as some of the answers are surely lost to history. Thanks, have a good day!

>>> Currency creates the problem that government solves.

Thank you - brilliant

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