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Charles Hoskinson: “All You Have To Pay Is Everything”

Social structures tend to have what Charles Hoskinon calls “the social sinkhole effect.” What’s that mean? 

“…A sinkhole grows from the bottom up,” the blockchain veteran, who co-created Ethereum and is creator of Cardano, tells me. “It doesn’t grow from the top down. So, you’re just driving on the same road every day, and, unbeknownst to you, a hole is forming and eventually gets so brittle, that your car falls in, and you go 12 feet into a ditch or something like that.” You’re now in a hole.

Societies are the exact same way, says Hoskinson. “They decay, but the institutions are still there: the military is still there; the currency is still there; the politicians are still there, and you’re still voting. And then somehow, someway, some triggering event happens, and then the sinkhole breaks, and the whole society falls into it.” The Soviet Union was a great example of that. 

“Chernobyl was a decaying factor, and there were dozens of decaying factors,” said Hoskinson. “But, no one decaying factor was enough until they reached the very end. It was just like pushing a domino, and then it cascades and the whole thing falls through.”

We’re seeing this in America, for example, says Hoskinson. “I never thought in my lifetime, I would see Americans storm our capital. I just never thought that such a thing would happen. That’s a movie. It’s not reality. I never thought in my lifetime, we would be in such a divisive political culture, where people we politically disagree with are deplatformed, censored, and demonized to a point where family members won’t talk to each other. That’s like Civil War stuff you read about abolitionists and the 1850s in the state of society.” 

While U.S. institutions are still standing, they’re showing signs of that social sinkhole. I asked Hoskinson to fast-forward 80 years, to the year 2100. What will the world look like? 

“Form follows function, and form follows culture, ” ripostes Hoskinson. “So, there’s really two realities that we’ll converge towards, and they’re mutually exclusive realities. One is the vision China has for the world with social credit, and this concept that a very powerful centralized government that has a dictator or collection of oligarchs will basically decide what is right for humanity. That group of people will basically guide us into the future, and we must surrender our individuality, our autonomy—and we must surrender our agency as humans—to this central entity for the greater good. That’s basically the way the Soviets looked at the world. The Great Leader shall lead humanity to utopia. All you have to pay is everything.” 

China is the dominant force, notes Hoskinson, with a big economy, a big military pushing the centralized philosophy and indoctrinating it in their debt diplomacy in Africa and other places. Hoskinson says it doesn’t necessarily have to be China which pushes this philosophy forward, for Russia could rise and do it. 

There is an alternative. “And then the other side is this concept of maximizing the individual without compromising the will of society,” continued Hoskinson. “It’s creating rules where we can be the most of ourselves, but yet, we will not behave in ways, either through wisdom or through immutable logic, that will harm society or whatever we care about as a society. It could be the environment or what have you. That’s a libertarian-utopia. Violence goes away, pollution goes away, and these types of things, because the system is built in a way that so radically disincentivizes, and so easily intervenes when it does occur, that it just stops happening.” 

You see this in certain societies, like in Japan, says Hoskinson, who has lived on the island nation. “They have a very low crime rate. And most people just do the right thing. They’ll just always return their shopping cart, because there’s a social fabric there that kind of pushes them in that particular direction. And it’s inconceivable not to do such a thing. So social systems—algorithmic or otherwise— can compel behavior without force or without a powerful centralized government, if designed correctly.”

Perhaps these protocols can have a big impact on the future. “They do create an expectation of things,” said Hoskinson. “The minute you sign the Magna Carta, you have an expectation of certain rights, even under a dictatorship. The minute that you have the ability to have transparent money, transparent voting, transparency in the use of funds, you start expecting those things. And, if they’re absent, you now think it’s a human rights violation.”

It wasn’t too long ago that people thought other people were property, notes Hoskinson. “And that was socially acceptable. For most of human reality, that was socially acceptable. Slavery has existed for thousands of years. Then the minute that we got rid of it, as a society, we now realize in hindsight, it was one of the most important of all human practices. So, similarly, when we look at the year 2100, there’s going to be a deep reflection on the things we take for granted today. And a realization that many of the social norms and customs we have today are deeply unethical and deeply reprehensible.”

Hoskinson mentions Prof. Yuval Noah Harari, a historian and philosopher who wrote the Homo Deus. He is a vegan. Why? “Because he says, hang on a second here. We treat animals just like people treated slaves, and if AI becomes superhuman, then wouldn’t AI learn from us and realize that  [it is] now to a human what a human is to a cow. And, if we say it’s ethical for us to treat cows this way, why can’t an AI treat us the way we treat cows? So, we have to lead by example. That kind of transcendent ethic is definitely something to think about.”

So, what happens when we’re no longer the most intelligent creature on earth? “That’s a problem, because, historically, you get eradicated or basically, you become the minority population, and you get severely restricted, as we’ve done with all the other creatures that are less intelligent than us,” says Hoskinson, who admits it’s not clear to him what the future holds.

“If the Chinese way of thinking, this concept of social credit, is going to win out or, on the other hand, if this crypto libertarian ideology will win out, and we develop a higher wisdom and a higher ethic?”

Hoskinson also doesn’t know if humanity will start making decisions based on a long time horizon or if we will continue to have a short time horizon? “There’s this concept that the Iroquois had of seven generations, where they ask themselves, What will the decision we’re about to make do to people seven generations from now,” Hoskinson says. “It was inculcated into their decision making process.” So, what are we going to do? What should the world look like in 2100? 

“We’ll probably all be dead or incredibly old,” said Hoskinson. “So, we’re not making decisions for ourselves. We’re planting trees, which shade we won’t know. And so, when you start making decisions like that, then you start divorcing whether you’re going to get rich or get laid or whether something benefits you, and start thinking in a more custodial role of what is best for the human race, what is best for the planet, what is best for society, and so forth. And then, once you’ve converged to that, it’s less of a question of vision, and it’s more a question of execution, and what things must we invest in, and do collectively to build our way there?”

When he lived in Japan, Hoskinson remembers being in Osaka, talking to a rail worker who worked on the Shinkansen bullet train. “He told me his great grandfather was making trains and building railroad tracks,” said Hoskinson. “His grandfather was a train man, and his father, too. And he’d been working on a train for 20 years, and his kids are just about getting old enough to get hired. The Japanese railroad companies had plans for railways going to 2055, and that’s just expected.”

That mentality doesn’t exist in the American culture. “And that’s one thing that has to be deeply contemplated,” says Hoskinson. “And blockchain will reflect that. It’ll either be a dystopian tool to dominate and control, or it’ll be a liberating tool. And it is completely dependent upon what happens after the sinkhole collapses, and we rebuild everything.”

Listen to The GoldSilverBitcoin Podcast with Charles Hoskinson below: