Trust is a useful human attribute in small groups like family, the clan or the village. The size of the group allows for quickly addressing a breach of trust, but also allows for quickly rewarding the holding of trust. A neighbor helping a neighbor in a small town will get immediate feedback from the rest of the town. In non-Western arrangements it is even more obvious. The complex relationships in the clan or tribe require trust as a unit of currency to work. At the center is the high trust members and at the fringes are the low trust members. It is what made the Mafia work for so long. They adopted the Arab tribal system which was impenetrable to western investigative techniques.

Trust does not scale up. The Jews in Germany were used to pogroms. Going back to the dawn of the Christian era in Europe, Jews had been subjected to various forms of persecution, usually for money. The Holy Roman Emperors would routinely shake down the Jews for money to fund their operations. The Church would commit similar shake down operations. Occasionally it became violent. The Jews adapted and learned how to survive it, based on a trust that their neighbors would never go too far with their persecutions. That was the fatal error for them in the 20th century. The Jews of Germany trusted the good sense of the average German. Of course, history is littered with examples of people trusting their rulers only to be murdered by them.

In modern times, Americans are struggling with this conundrum. The American culture is based on trusting a small, inept and distributed government. As the national state swells and absorbs the rest of government, the relationship between man and citizen has to change. Americans have to become much more like Europeans, who are quite used to living with an aggressive central state. They are also quite used to avoiding its gaze, including the bribing of officials, small scale sabotage of the system and other ways to dodge the rules. Americans doing business abroad are often shocked by this open corruption, especially in nations further south, but it is a rational survival technique. Americans have not figured this out, but they will eventually.

What helps the process and may derail some ugly conflicts are things like this. The people claiming to be good at safeguarding your money are not worthy of trust when they fail in basic ways like this. Even rich people are finding that the Borg is not as all powerful as it claims.  Of course, the rampant abuse by the Obama administration coupled with their staggering incompetence with health care has minted a new wave of government skeptics. A whole lot of people who used to say they trusted the government “to keep us safe” during the Bush years are having second thoughts. It may be too late to roll back the surveillance state, but these events will foster a new attitude toward it from the commoners.

That’s important because of what’s coming down the road. If you read a story like this you get a glimpse of that is coming. Bitcoin is useless as a currency, at least as a large scale currency. I’ll concede it has some utility for perverts and drug addicts. The technology, however, can be very useful to the state. Bitcoins must be validated at each use. The software to do this can be distributed in such a way that validation appears seamless. To do that the life of each coin must be maintained. The chain of custody is a part of the validation. It is the same concept we use for titling a car and validating its mileage. If the dealer rolls back the odometer, this can be caught with a title search. Some states do this every time they register a car.

The dream leftists ruling elites since the beginning has been to register and track every member of society. The great enemy of the revolution has always been the same. That is people’s unwillingness to go along with the program. If you can track every person and every transaction, you can prevent the sorts of behavior you want to eliminate.  First you start by “nudging” people and then you can force those who don’t go along with the suggestion. Binding the technology of bitcoin with the ultimate unique ID generating algorithm ever conceived, DNA, you can have the perfect system for tracking and validating human behavior. Every transaction can be tracked and it can also be approved.

The future is not written and the way to change course is for people to lose faith in the rulers. Regular failures by the folks promising us we can trust them is a sure way to grow skepticism amongst the people. Even dimwits like the modern American voter get tired of being screwed eventually. Liberals will never lose the faith, but the rest are persuadable. If they are not won over by appeals to reason and tradition, maybe scaring them will work. The more the average guy is thinking about who is watching him as he swipes his card, turns on his GPS or walks down the street, the less he is going to trust the people doing the watching.