Why the IMF and Reagan have more to do with climate wreckage than Saudi Kings.

Since the Covid Pandemic hit, governments have been pumping money into the economy taking no account of the actual resources on a finite planet. According to this article, in the US alone, money supply increased by 25% (Yes,.. a quarter of its original amount) in a matter of 2 weeks in November 2020. To give some context, the money supply in the US till 2008 was about 1.8 trillion dollars (which took about 400 years to reach that number). The US steadily added about 2 Trillion dollars in a span of 12 years since the crisis, which means it effectively doubled the size of the buying power of the entire country in 1/40th of the initial time. Have Americans 2-Xed their productivity? Has the amount of land area containing trees/ forests/ land to grow the new timber that will furnish the houses of the new millionaires increased? has the world’s fresh water doubled in 12 years? Have the mines in China that supply TVs, fridges, etc magically expanded to cater to the whims of people in suits and ties? Have the mines in Congo’s pristine rainforest doubled in 12 years to cater to the increased demand?

The world loses about 80,000 acres of untouched rainforest daily. This kind of destruction has a lot to do with a growing population and demand for good and services. People in rich countries (me included) are hogging on foods and goods whose price does not reflect the actual cost of the good, because of a plethora of negative externalities and the ‘tragedy of the commons’ that allows me to buy a beefburger at 1 pound from Mcdonald’s, a process that involves 4 years of cow rearing and breeding, a jack tonne of water and obnoxious amounts of oil in transporting that beef from South America to the UK.

When you look at the buying power of the pound compared to other currencies, the eye watering comparative richness of having goods from developing countries is a luxury. However it is a castle built on quick sand… ever since the dollar decoupled from gold under Reagan, the fugazzi money that has been printed by the Fed and spread throughout the world has led to an artificial and unsustainable demand for stuff. The world’s foreign exchange markets are a work of short sighted actors maximizing profits and trying best to think that inflation is the only consequence of a huge pump in money in the world.

It’s obviously more than that. It is the destruction of our oceans and mountains and forests. And Saudi Kings are a mere sacrificial pawn, a scapegoat in this gambit of noxious incentives made to preserve the coherence of the society we live in. This is why blockchain can fix all of this, because it solves the fundamental problem of trust and agents. We no longer have to rely on the short sighted policy of the Fed that is slow to respond to change. Nor the IMF or World Bank that have led to developing countries having explosive and unmanageable population explosions that aren’t being able to cope with the resources available. We can now instead rely on a protocol, such as ReFi, ( Regenerative Finance) or Toucan, or KlimaDAO. Even the good old IMF is looking into having an ‘ IMF Climate Coin’.

Despite the tendency to over-idealise any beacon of hope, I think we should still cherish, idolize, and God-ify Blockchain like we did Electricity 100 years back when Westinghouse and Edison were racing to fame. Like the problem of darkness that electricity solved, blockchain has solved the darkness of distrust, and now we no longer have to rely on centralised power concentrations that has in the past and will in the future lead to decisions lacking ‘skin in the game’. The Roman empire fell for the exact same reason, the upper classes and those in power would rather spend their time having wine and watching people fight in the Colosseum rather than fight sword to sword with their armies to preserve and expand the empire.

Hopefully, our current civilisation has more to see in Mars and the Moon before it collapses like the Romans’, and dwindles like Galactic Empire in the Foundation. Blockchain has changed the world, and may even save our planet.

Instead of ‘In God we trust’ printed on the dollar, we can safely say, ‘In Code we trust’ minted on the blockchain.

Much love, and may the node be with you.