The events of the last couple have been fascinating to watch. I spend a lot of time thinking about how a Catallax based society would approach some of these same issues. Specifically #DefundThePolice is fundamentally built into the underlying Catallax System.

Catallax isolates State Accounts in the system in a way that financial violence can be used against the state by the people in a couple of ways. First of all, State Accounts cannot have any kind of privacy in how funds are used. The inflows and outflows are public record by default.

In a Catallax based system each government domain has a State Account. They collect taxes via the systematic decay of currency in accounts that elect that domain. These Domain Accounts can create Agency Accounts for the various agency accounts that their collected taxes fund. The police department would be one of these agency accounts. Citizens that pay taxes into the Domain Level account get a Democratic Veto right to all agency accounts. The democratic veto is described as follows in my book Immortality:

VTO. Democratic Veto

... How can the (CTZ), using selective citizenship (SCZ) and the public ledger (PLG) keep the state's power in check?

Power corrupts and the citizen must have tools to regulate out of control power without the use of force.

When a citizen pays taxes they should get a vote in that 'state'. We will do this via the democratic veto.

This veto is a 3 phase vote. Citizens can vote 'abstain', 'deny', 'override' on a state account.

This gives power to small minorities to stop the payment from state accounts until their concerns are addressed or their negative vote is overridden by other citizens.

We also don't want small issues gumming up the general working of the state. As a result we should provide for agency accounts that can be selectively vetoed when particular issues arise in the running of those agencies.

Therefore:

Establish the democratic veto for state accounts and selective veto for agency accounts.

This system allows small groups to have their voice heard and amplified. Larger groups must be proactive in overriding the veto and while this proactivity certainly hasn’t kept people from being oppressed in the past, it at least puts the burden of action on those that would seek to not meet the needs of the minority.

In a practical application, communities across the US could use the Democratic Veto to freeze the accounts of police departments across the nation and keep those accounts frozen until the departments make the demanded changes.

This is the fourth part in a five part series of posts that lay out the basics of what we are trying to build with Catallax. The series will follow the following schedule and I’ll update the list with links as the articles go live:

The Catallax system requires some ‘central’ authority to exist to set decay rates and pull the levers of the economy to keep the economic piston pumping. A huge benefit of cryptocurrencies is the ability to do away with centralization. In the same way that we took a long / short position on privacy, we will also take a long / short position on centralization.

In our opinion, the world is not ready to overthrow the nation state. There may be a day in the distant future where we can reach this kind of reality but we believe that there needs to be a bridge between now and then. In order to neutralize too much authority, we propose a scenario of Selective Citizenship and the Citizen Override.

Selective Citizenship allows for citizen accounts to elect to pay a tax out of their pref flows that go to an institution that they want to be a part of. These institutions can be State level institutions or something smaller like a local utility district or school system. We contend that one of the killer apps of ethereum and other cryptocurrencies is taxation. Once municipalities realize that by issuing their own form of crypto they can make taxation automagical you will begin to see a lot more municipalities issuing crypto. Catallax seeks to speed this revolution by adding a taxation layer into our system.

We are also short authority and believe that citizens should maintain control over the ruling authority. Therefore we put forward the idea of the citizen override. The citizen override provides the opportunity for citizens to give an authority the right of easy taxation, but give the citizens an easy way to turn off the faucet and override the ability of the account to operate.

An example of how this would work on the largest scale would be the US nationalizing a Catallax currency and enforcing that all citizens elect the USA tax. This tax mechanism replaces the IRS. In return citizens now have a method to turn off the faucet by voting. If Congress reaches a 23% approval rating like they have now, the citizens that pay the tax can turn off the government's access to pay representatives their salaries.

In a more realistic scenario, the first Catallax system will start in a state of benevolent dictatorship, evolve an authoritative court system, establish a legislative council that will turn into an elected body and then eventually pass to a form of constitutional organization where citizens have significantly more control over their governments than they currently do.

Our civic institutions have taken a serious hit in the last few decades as capitalistic organizations have found profit avenues that have made us less dependent on those civic organizations. The Selective Citizenship system seeks to restore that civic infrastructure by giving grassroots organizations a dead simple way to generate revenue. Because the money that is taxed is money that is already flowing away from citizens it is much easier to convince someone to elect the tax. They are going to be losing the money anyway, so why not have it go to a group seeking to improve the local street infrastructure or establish new green spaces?

This governance may be one of the last parts of the system to come online, but it is one of the most important pieces and any of our supporters should demand that these items stay central to the conversation of Catallax and its future.

If this is interesting to you and you'd like to see where we are going with Catallax, please pick up my book Immortality (Purchase of a physical or kindle copy helps support this project).

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Catallax and Enabling Peaceful Financial Violence Against the State

VTO. Democratic Veto

Get to know Catallax: Selective Citizenship and Citizen Override