Essential Dialogues of Plato, Laws: Books I-II
The Wisdom of Strangers
I like what John Stuart Mill wrote about Plato’s central preoccupation in “Laws”:
Not knowing what Justice and Virtue are, it was impossible to be just and virtuous; not knowing what Good is, we not only fail to reach it, but are certain to embrace Evil instead. Such a condition, to any one capable of thought, made life not worth having. The grand business of human intellect ought to consist in subjecting these general terms to the most rigorous scrutiny, and bringing to light the ideas that lie at the bottom of them.
- from the Edinburgh Review (April 1866)
The act of subjecting our ideas to rigorous scrutiny is an essential practice in a world and society where everything is changing rapidly, even violently. To consider the future history of money is to imagine what hindsight will reveal about our time, and try to apply that wisdom today.
The Editor of Essential Dialogues of Plato, Pedro de Blas, writes in his General Introduction,
“Whether or not we can fully work out Plato’s program and whether we can agree with it is hardly the point. In my opinion, his merit is to have identified the fracture lines of a great city and empire, and to have discussed the competing strategies that are available in order to deal, individually and collectively, with major upheavals in our surrounding reality and our own view of the world.”
The project of this blog is the same as that of Plato, so a meditation on Plato’s “Laws” as 2020 comes to a close can hopefully help deepen our understanding of the fracture lines within the American empire and assist in finding strategies to deal with the inevitable earthquakes.
Bitcoin is one such earthquake.
It only makes sense, therefore, to start our reading by examining a strand of American pre-history that began in ancient Greece. Plato is well-known for his significant contribution of ideas, principles and philosophies to what became Western Civilization.
“Laws may well have been Plato’s last attempt to link his philosophy with reality, and a declaration of how he thought a polity should actually be organized and why.” (from the Introduction)
The speakers in Laws are a nameless Athenian Stranger, a Cretan by the name of Cleinias and a Spartan called Megillus. The Stranger expounds on the topics of Virtue, Politics and Law-Making as the three undertake a long-distance walk along a country road on a midsummer day. The Stranger remarks that, “The Cretan laws are with reason famous among the Greeks; for they fulfill the object of laws, which is to make those who use them happy.”
Without bothering ourselves in this meditation with the actual details of the legal code that Plato explores in later books, let’s consider the first principle: that laws should be measured according to the degree that those who use them attain happiness.
Image: The Third of May, 1808 (detail), oil on canvas, Francisco Goya (1814-15)
All People are Always at War
Essential Dialogues of Plato: Laws, Book I
The following section — a summary, paraphrase and interpretation of Plato’s Laws I — emphasizes portions that resonated with me as particularly relevant and perhaps instructive for our current crisis in politics and government. These words are not my arguments, but set out my understanding of Plato’s.
The first thing to understand is that laws and society have been arranged with a view to war. The world is foolish in not understanding that all people are always at war with one another. For what we generally call “peace” is so-called in name only.
In reality every city is in a natural state of war with every other, not by nature of certain limited declarations of Congress or other governing bodies, but everlasting.
A well-governed state, therefore, ought to be so ordered as to conquer all other states in war. This is applicable not only to states, but also to villages. And in the same village, a state of war exists of family against family, and of individual against individual.
All individuals are publicly one another’s enemies, and each one privately his own. …there is a war against ourselves going on within every one of us.
In this conversation we are considering the natural principals of right and wrong in laws. Consider the case of a family with several brothers, the majority of whom may be unjust and the just may be in the minority. If an authority, or judge, were set over them, which would be better:
1) a judge who destroys the bad and appointed the good to govern themselves?
2) one who, while allowing the good to govern, let the bad live, and made them voluntarily submit? Or third,
3) a judge who not only did not destroy anyone, but reconciled them to one another for ever after, and gave them laws which they mutually observed, and was able to keep them friends?
The last would be by far the best sort of judge and legislator. So now, extrapolating the example to the state, those who constitute the state and create order with respect to the lives of its citizen would chiefly have in view this type of conflict that is internal (such as among a family of brothers). Rational organizers of society would desire that any civil war be terminated by re-establishing peace and friendship rather than the destruction of one of the parties, and by the victory of the other. Then, once reconciled, the brothers in the same family — or citizens of a state — should give their attention to foreign enemies.
Everyone in a rational society would desire that laws are always made for the sake of the best.
But war, whether external or civil, is not the best. Peace with one another, and good will, are best.
Victory of the state over itself is not to be regarded as a really good thing, but as a necessity. A person might as well say that the body was in the best state when sick and purged by medicine, forgetting that there is also a state of the body which needs no purge.
And in like manner no one can be a true statesman, whether he or she aims at the happiness of the individual or the collective, who looks only, or first of all, to external warfare. Nor will he or she ever be a sound legislator who orders peace for the sake of war, rather than war for the sake of peace.
The legislator when making laws should have in view all virtue and devise classes of laws answering to the differing kinds of virtue so that they fulfill the principal object of laws which is to make those who use them happy, and that they confer every sort of good.
There are two kinds of goods: human goods and divine goods.
Human goods depend on the divine. So a state that attains the divine goods will necessarily also attain the human goods. Whereas a state that focuses on attaining only the human goods, ends up with neither having not attained the greater which is divine goods.
GROUP ONE: of the lesser, human goods, are the following in order:
#1 health,
#2 beauty,
#3 strength, and
#4 wealth (only when co-existing with vision and wisdom regarding ones companions)
GROUP TWO: of the greater, divine goods are the following in order:
#1 wisdom,
#2 temperance, wisdom and temperance together with courage yield…
#3 justice, and
#4 courage
The second group of goods naturally take precedence of the other goods, and this is the order in which the legislator must place them.
Included among all its many concerns, the legislator has to be careful how the citizens make their money and in what way they spend it, and to have an eye to their mutual contracts and dissolution of contracts, whether voluntary or involuntary: it should see how they order all this, and consider where justice as well as injustice is found or is wanting in their several dealings with one another, and honor those who obey the law, and impose fixed penalties on those who disobey. The lawgiver will appoint guardians to preside over these matters: some who walk by intelligence and some by true opinion only, and who will interpret all regulations together to be in harmony with temperance and justice, and not with wealth or ambition.
About Courage:
Courage is not only combat against fears and pains, but also against desires and pleasure, and against flatteries, which exercise such a tremendous power that they make the hearts of even respectable citizens melt like wax. If the source of the flattery is evil, then evil has found a way to corrupt the respectable.
Where is a regulation then about pleasure similar to that about pain to be found among your laws? What is there in your customs and culture that makes your citizens equally brave against pleasure and pain?
Any speculation about laws turns almost entirely on pleasure and pain, both in states and in individuals. These are the two fountains of nature: he who draws from them where, when and as much as he ought, is happy; and he who indulges in them ignorantly and at the wrong time, is the reverse of happy.
In forming a conclusion about our laws and institutions, there is a proper way to tell how good and bad are to be estimated. All those who are ready at a moment’s notice to praise or censure any practice under discussion, proceed in a wrong way.
For example, suppose a person to be praising wheat as a good kind of food, whereupon another person instantly blames wheat, without ever enquiring into its effect or use, or in what way, or to whom, or with what, or in what state and how, wheat is to be given.
This is just what we do in our public discussions. At the very mention of a certain word or topic, one side is ready with their praises and the other with their censure; which is absurd. For either side cites their witnesses and approvers as evidence, and some of us think that we speak with authority because we have many witnesses.
Education certainly gives victory, although victory sometimes produces forgetfulness of education; for many have grown insolent from victory in war (or public opinion), and this insolence has engendered in them innumerable evils; and many a victory has been and will be suicidal to the victors; but education is never suicidal. To be absolutely sure of the truth of matters concerning which there are many opinions is an attribute of the gods not given to humans.
In all gatherings of humankind there ought to be a leader.
We ought if possible to provide them with a quiet ruler. Someone who understands society, for his or her duty is to preserve the friendly feelings which exist among the company at the time, and to increase them for the future. We must appoint someone sober and wise to be master of the revels.
For if the ruler of drinkers is himself young and drunken, and not over-wise, only by some special good fortune will he be saved from doing some great evil.
Image: Two Satyrs, oil on canvas, Peter Paul Rubens (1618-1619)
The Art of Managing Men's Souls
Essential Dialogues of Plato: Laws, Book II
In Book II, Plato expands on his central theme of temperance and the virtue of a system of laws (and leadership) that establishes boundaries for its citizens routed in divine principals of good.
The dialogue in Book II covers a layered and nuanced review of alcohol consumption, beauty in art, music and dance, and the Athenian Stranger’s doctrine of “right education” which depends on “the due regulation of convivial intercourse.”
Rather than expound on each of these topics in this section, I will attempt a distillation and extraction of one central point that is the grand take-a-way of it all. The dialogue is hard to follow at times. It requires slow, active reading and a suspension of our contemporary way of thinking about social and political interactions.
Keeping in mind the larger discussion underway (namely, what is the nature of law and how a society should be governed), Book II brings our focus to the topic of education and firmly establishes a hierarchy of personal qualities that should be taught and modeled (even enforced) among citizens from childhood and throughout adult life.
I would inflict the heaviest penalties on anyone in all the land who should dare to say that there are bad men who lead pleasant lives, or that the profitable and gainful is one thing, and the just another.
For in truth, to have sight, and hearing, and the use of the senses, or to live at all without justice and virtue, even though rich in all the so-called goods of fortune, is the greatest of evils… For I plainly declare that evils as they are termed are goods to the unjust, and only evils to the just, and that goods are truly good to the good, but evil to the evil.
Plato’s text warns against extreme indulgence in pleasure without incorporating the balancing force of pain. He argues for the recognition of opposing forces in stark contrast to the relativism of our present age.
Image: Declaration of Independence, oil on canvas, John Trumball (1817)
Self-Evident Truths
Bitcoin & the separation of Money and State
~ Opening dialogue of Plato’s Laws: Book 1: Essential Dialogues of Plato, Laws: Books I-III
Athenian Stranger. Tell me, Strangers, is a god or some man supposed to be the author of your laws?
Cleinias. A god, Stranger; in very truth a god: among us Cretans he is said to have been Zeus, but in Sparta, whence our friend here comes, I believe they would say that Apollo is their lawgiver: would they not Megillus?
Megillus. Certainly.
~ Preamble to the United States of America Declaration of Independence
We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights, that among these are Life, Liberty and the pursuit of Happiness.
Plato begins his treatise on Laws by establishing the first principal that the origin of laws is divine, and not manmade. The “truths” expressed in the Declaration of Independence reflect a similar view among the American Colonialists that a “Creator” is responsible for the rules that ought to (and do) govern our lives. By comparing views expressed over 2300 years ago in ancient Greece with the beliefs that influenced the original Framers, we can improve our understanding of what assumptions and values are embedded in our contemporary political system.
The historical record shows that faith and belief were guiding forces for many of the first Americans, yet a significant distinguishing feature in the founding of the United States was the separation of Church and State. History has repeatedly shown that those who suffer as a result of a particular political system eventually separate themselves to institute a different system when and where they have the economic and political power to do so.
I expect one of the distinguishing features of our time will be the separation of Money and State because of Bitcoin. The union of Money and State today, as was the case with Church and State in centuries past, is a function of laws. In order to develop an informed view of whether money ought to be separated from the control of the State, Plato’s dialogue on laws may be instructive.
If man (i.e., allkinds, humans, we the people) is the originator of laws, then it may be reasonable to expect that we can produce different results or outcomes notwithstanding the same or similar actions from prior historical periods. When it comes to money and laws, Central Bankers and many politicians around the world today seem to embrace the mantra that, it can be and is “different this time.” However, if laws are things that originate beyond us and exist apart from us (let’s say there are “natural” laws upon which our human laws may be based) then by understanding laws intrinsically we can better predict and navigate the consequences when man attempts to depart from the wisdom of the lawgiver.
The Future History of Money
In the last ten years, a choice has emerged that could prove to be extremely disruptive to the present global monetary order.
Plato’s Athenian Stranger tells us that the object of laws is to make those who use them happy. Are the people around the world today happy with their money?
Like the early Americans who used their economic and political power to enforce their preference for a new system of government, users of bitcoin and cryptocurrencies are expressing their preference for a new form of money.
What unfolds in the years ahead may be similar to the founding of a new nation.
Today we live in a world where our money is fiat currency and there is no constraint on the supply of fiat money that can be created.
In order to grasp why the separation of Money and State might be an attractive proposition to people around the world, whether in emerging economies or fully developed super economies like the United States, it is important to understand both the natural laws and manmade laws that characterize the money we use today.
Consider that we refer to laws of supply and demand to explain our observation over time that when the quantity of money in circulation increases, the value of each unit decreases. Another way to say this is that each unit of money buys less and less as more money enters into circulation - also called, inflation.
Federal Reserve Note v. United States Dollar
In the United States today (and around the world), money is synonymous with the United States Dollar (“USD” or the “dollar”). What many people do not realize is that technically speaking, the paper currency dollar is actually a debt instrument called a Federal Reserve Note that is denominated in dollars. The dollar bill in your wallet represents one dollar borrowed by the United States Treasury from the Federal Reserve Central Bank. Each dollar is like a mortgage on a house where the federal government is the borrower, the Federal Reserve is the bank, the citizens are the collateral and taxes collected from those citizens will be used to pay the bank interest on the loans.
The borrowing activity of the federal government consists of Treasuries underwritten and sold by the Federal Reserve on behalf of the United States to investors and countries around the world who have historically considered the borrower - the United States of America - to be a good credit risk on the basis of its fiscal stability, political credibility and the economic productivity of its citizens whose labor and income provide the credit and confidence that “backs” the Treasury.
Today’s dollar is not convertible into another asset, such as gold or silver, like previous versions of the dollar were.
The big take away here is that, at the federal level, we have a money system based on our government’s capacity to keep borrowing and confidence in the United States and its leaders (i.e., our nation’s economic strength and prosperity depends on the demand for USD around the world). This trust is derived from the stability of the nation both fiscally and politically accumulated over many decades. The system of laws on which the country was founded and the evolution of those laws to date have made the United States the trusted steward of money that the whole world depends upon. Nevertheless, there are signs everywhere that the trust underpinning our money and securing the dollar’s position as the leading global reserve currency is deteriorating.
THE HARDEST MONEY EVER MADE
With respect to certain cryptocurrencies the supply of money units operating on their respective networks is permanently fixed and cannot be increased at the whim of any person, governing entity or political process. For example, the Bitcoin network is programmatically restricted to create only 21 million bitcoins (approximately 18.6 million bitcoins have been generated and are in circulation to date with 30-50% of that supply thought to be lost forever).
Cryptocurrency is not backed by a physical commodity (or other asset) and is not backed, issued or controlled by a sovereign government. Its strength depends on the trust earned over time among its users.
Accordingly, a separation of Money and State has de facto already occurred, but will it persist? Could cryptocurrencies prevail over fiat currencies? Bitcoin and cryptocurrencies are already well along on the path to providing people around the world with a widely adopted medium of exchange and store of value. This is the first time in human history that we have a scare digital commodity form of money, useful - even necessary - in an internet age where the vast majority of communications and transactions are also digital.
In debating the topic of the future history of money in 2021 and whether the future is being shaped in favor of happiness for all those who use money, are Plato’s Athenian Stranger, Cleinias and Megillus correct?
Are there a set of forces and principles that exist, that will act upon us consistently and mercilessly because we are subject to them by virtue of our very existence whether we like it or not? If so, what are these principles and how will they impact our money and our future?
*This essay “Money Problems” is an updated composite and republication of a series of writings originally posted by Kianga Daverington on Substack on July 7, 2019; July 21, 2019; November 4, 2019; and November 10, 2019.