Liberating Ourselves by Starting Something New

In defense of "exit" over "voice" as a strategy to expand human freedom

On October 13, 2008, the heads of America's largest banks sat around a table with then–Treasury Secretary Hank Paulson. The bankers were there to accept what would become the largest financial bailout in history. Take it or else, Paulson said of the Troubled Asset Relief Program.

The bankers complied.

The bailouts prompted a handful of cypherpunks to speed up work on a great technological experiment. Innovators like Nick Szabo, Wei Dai, and Hal Finney had already been playing around with ideas to challenge the existing monetary system. But on October 31, 2008, the pseudonymous Satoshi Nakamoto published "Bitcoin: A Peer-to-Peer Electronic Cash System."

That white paper was like universal acid poured over the gears of a great machine. The advent of the distributed ledger jolted many of us from our dogmas: If something as apparently core to state sovereignty as a working monetary system might be provided through a decentralized technological means, the world suddenly looked like a different place.

Up to that point, advocates of human freedom had pursued change largely through persuasion and advocacy. If you wanted to liberate people, you had to cry your teardrop in the swirling ocean of public opinion every election cycle and pray the tide would turn. If you wanted to change the law, you had to get your brilliant white paper into the hands of a congressman (who had probably just used those same hands to take a dirty campaign contribution).

Politics. Policy. Punditry. That's more or less the sum of "voice" as a strategy.

Both progressives and conservative populists are currently engaged in political trench warfare, which risks becoming less metaphorical as the tribes become more hostile. Such hostility is an inevitable byproduct of the voice theory of political change, but something better is coming: the end of politics as we know it.

Economist Albert O. Hirschman in his 1970 treatise Voice, Exit, and Loyalty explained that there are three ways to respond to any human system, be it a product, an organization, or a political regime. Voice—express yourself to persuade others to change the system. Exit—leave the system, joining another system or starting something new. Loyalty—stick by the system, even if it's less than ideal.

The 19th century was in many respects the era of loyalty (God and country). The 20th century was the era of voice (ballots over bullets). But the 21st century will be the age of exit (governance by choice).

One of the basic tests of "good" law is whether people actually want to follow it. In fact, the better the laws, the more likely people are to try to migrate to that legal system. And vice versa—just ask Venezuelans. The easier exit becomes, the less it matters what any theorist thinks is justice, much less "social justice." We're entering an era of radical social experimentation carried out on far smaller scales than the revolutions of the past. And yet successes will be scalable to the level of humanity.

Right now a million software developers are creating new social operating systems using distributed ledgers, smart contracts, and cryptocurrencies. Users will either adopt these systems or not. And if they do, they're as good as law. Coders will thus generate whole new regimes, which users can simply opt out of if they aren't satisfied. Can you say that about politics?

When it comes to the voice strategy, most people still labor under a men-as-angels theory of government: If we could just get the right people in power…

But when it comes to exit, "Lawmakers could be saints, devils or monkeys on typewriters—doesn't matter," writes philosopher and venture capitalist Michael Gibson. "The opt out-opt in system lets only good laws survive. Bad laws are driven out of production. Bad laws can only inflict harm and destroy wealth up to the cost to opt out of them. We can underthrow the state one contract at a time."

The case for exit, then, is based not on a Pollyanna fantasy of how governors might behave, but on a recognition of the burgeoning technosphere we now inhabit. In my book The Social Singularity (Social Evolution), I argue the age of exit isn't so much a choice but an inevitability given our current technological climate. The world is becoming too complex to be organized by hierarchies of power. Nimble nodes within flexible networks will replace more and more of humanity's outmoded top-down mediating -structures. Superior collective intelligence is on the way.

Cypherpunks have already created systems of monetary self-government. Digital nomads are quietly migrating to special economic zones (SEZs) that offer healthier legal institutions. Seasteaders began tokenizing the first floating platforms off the coast of French Polynesia. Innumerable options are appearing on the horizon that promise to drive the cost of exit down. Once enough of us adopt this innovation frame, there's no turning back.

The Belgian liberal Paul Emile de Puydt foresaw this coming way back in 1860. It would be simple enough, he wrote in Panarchy, "to move from republic to monarchy, from representative government to autocracy, from oligarchy to democracy, or even to Mr. Proudhon's anarchy—without even the necessity of removing one's dressing gown or slippers." Thanks to subversive innovation, de Puydt's system is upon us.

As technology grows in power, political theory is dying. The age of exit will be a post-ideological age, as people test their ideas in the petri dishes of programmable incentive systems and porous communities.

Voice cannot be dispensed with altogether. Some variant of it will be required to draw people into the newly created systems. But for those wanting a freer, richer, more varied world, there's still too much investment in voice as a strategy, and far too little investment in exit.

This article originally appeared in Reason Magazine. I argued for “exit” over voice against Reason co-founder Bob Poole.