The Blockchain Man

The term Organization Man is a rich one. From it, we can conjure up an image and a life.

It’s a man, not a woman. He’s white, standing somewhere between 6’0 and 6’2. He has a strong chin and medium length light brown hair parted on the left.

He walks from one meeting to the next wearing a dark suit with a pressed white dressed shirt and dark Oxford dress shoes. His wrist holds a watch – nice, but not extravagant, with a brown leather strap and a gold-rimmed face.

More than just an image, you can conjure up a life for The Organization Man, a term coined by William Whyte in his 1956 book of the same name. Even though the novel predates Whyte’s book by 30 years, Sinclair Lewis’ Babbitt (1922) established the archetype perfectly.

Today, the successor of the Organization Man — the Blockchain Man — is starting to emerge. To understand how he might evolve, let us first look back.

Lewis’ protagonist, George Babbitt, is very nearly the perfect Organization Man. He believes working a steady job for an increasing income and modern improvements is God’s purpose for mankind.

He lives in Zenith, a mid-size Midwestern city whose chief virtue is conformity and chief religion is boosterism. Prominent boosters/religious figures in Zenith include Vergil Gunch, the coal dealer, and Sidney Finkelstein, the ladies’ ready-to-wear buyer for Parcher & Stein’s department store.

Lewis opens the book by describing Babbitt’s daily routine in detail.

The morning after playing poker at the Booster club with coal dealer Vergil Gunch, he’s awoken by his alarm clock at 7:20. Yet, it is not just an alarm clock, it is “the best of nationally advertised and quantitatively produced alarm-clocks, with all modern attachments, including a cathedral chime, intermittent alarm, and a phosphorescent dial.”

He looks out from his sleeping-porch with delight at his suburban yard holding a sizable elm, a respectable grass lawn, cement driveway and corrugated iron garage. It is the neat yard of a successful business man of Zenith.

As he dresses for the day, he notes every item in his home and how it adds to his “solid citizen” uniform. The most important item is his Booster club button, which he wears with pride. After all, any decent man in Zenith belong to at least two or three booster clubs or lodges.

Babbitt talks The Organization Man talk. In a speech to the Zenith Real Estate Board, he espouses Zenith’s safety and wholesomeness:

“It may be true that New York, Chicago, and Philadelphia will continue to keep ahead of us in size. But aside from these three cities, which are notoriously so overgrown that no decent white man, nobody who loves his wife and kiddies and God’s good out-o’-doors and likes to shake the hand of his neighbor in greeting would want to live in them—and let me tell you right here and now, I wouldn’t trade a high-class Zenith acreage development for the whole length and breadth of Broadway or State Street!”

Lewis’s depiction struck home. Newspapers in Cincinnati, Duluth, Kansas City, Milwaukee, and Minneapolis each claimed that their city was the model for Zenith. Many claimed to know the man on whom George Babbitt was based.

The Organization Man
I first read Babbitt in college and could see echoes of Babbitt in every authority figure in my life up to that point.

If I had asked you to sketch a picture of the modern Organization Man, it would probably look not too different from George Babbitt nearly a hundred years ago. Newer gadgets and different clubs, but the fundamentals are the same.

William Whyte’s The Organization Man was a gonzo-sociology of the phenomenon as it was becoming fully mainstream.

Whyte saw the central values in American life shift away from the rugged individualism that had characterized the nation since its founding, towards a collectivist ethic that Whyte called the Social Ethic.

The Social Ethic, to which The Organization Man subscribed, had three tenets:

a belief in the group as the source of creativity
a belief in “belongingness” as the ultimate need of the individual
and a belief in the application of science to achieve the belongingness.
In the view of the Organization Man:

“Man exists as a unit of society. Of himself, he is isolated, meaningless; only as he collaborates with others does he become worthwhile, for by sublimating himself in the group, he helps produce a whole that is greater than the sum of its parts.”

This was a novel state of affairs.

For all of the history of homo sapiens up until the 19th century, cooperation rarely extended beyond the infamous Dunbar number of 150.

The logic behind the rise of the Organization Man was simple.

Participating in the global economy lead to a huge quality of life increase.
Doing so was only possible through large organizations.
For all the scorn today’s technologists heap on organization men, it was a rational adaptation to the times. My dad grew up handpicking cotton on a small farm in rural Northwest Tennessee. Given the choice between the Farm and the Organization, he picked the Organization. I would have too. I have yet to meet a TPS report so onerous I would prefer to be handpicking cotton in Tennessee in August.

Belongingness was so emphasized because the benefits were so substantial. The huge quality of life increases experienced in developed nations over the 20th century were the direct results of the Organization.

The adoption of the Social Ethic was a rational adaptation by individuals to the techno-economic paradigm of the 20th century.

The technologies of the second Industrial Revolution — from mass production to steel mills to scientific management — created a society ruled by large corporations that could leverage economies of scale.

Belonging to the group was the source of prosperity, and so the Social Ethic’s emphasis on belongingness and the Organization Man himself flourished.

The Organization Man taught us the truth in McLuhan’s famous line: “We shape our tools and thereafter our tools shape us.”

It was not the first time in history this had happened.

In The Selfish Gene, Richard Dawkins inverted society’s homo-centric view. Instead of thinking about organisms using genes to reproduce themselves, Dawkins turned it around and imagined that “our” genes build and maintain us in order to make more genes.

McLuhan’s statement is an extension of this view beyond biology to technology at large. Humans are as much shaped by our technology as the shapers of it.

Evidence suggests that beginning with the agricultural revolution, lifespans and quality of life went down for neolithic societies compared to their paleolithic predecessors. Societies and individuals did not deliberately choose a technology, agriculture, that caused them to live shorter, more miserable lives. However, after the rise of agriculture, they had no chance to go back. Agricultural societies made up of more, sicklier individuals pushed hunter-gatherers into the margins.

In the same way, the invention of the corporation created and shaped the Organization Man as much as the reverse. After the rise of the corporation, there was no going back. The Organization Man pushed those outside the Organization to the fringes through corporatism and nationalism.

The Anatomy of our Blockchain Future
In Technological Revolutions and Financial Capital, Carlota Perez suggests we’ve gone through three major techno-economic paradigms since the rise of capitalism:

The Industrial Revolution — beginning in 1771
The Age of Steam and Railways—beginning in 1829
The Age of Steel, Electricity and Heavy Engineering— beginning in 1875
Each lasted around a century (with some overlap from the previous paradigm). That places the beginning of the end for The Age of Steel, Electricity and Heavy Engineering right around 1974.

1974 was the year we hit peak centralization and began transitioning towards a new techno-economic paradigm. The personal computer, the Internet, and the World Wide Web have been the major technological elements so far.

They begin to allow for something the previous paradigm did not: the ability to coordinate production and reap the benefits of a global, capitalist system with less centralization than the 20th century organization required.

The freelance front-end developer who has a dozen clients, found through a half dozen different marketplaces like UpWork and Toptal, is decentralized in a way that has only been possible in the last decade. However, such disintermediation has not turned out to be the panacea that many internet pioneers in the nineties believed it would be.

The protocols underlying the internet, TCP/IP, SMTP and HTTP became common property and quickly suffered from the tragedy of the commons. They were abused and the value accreted to the application layer on top of them.

Instead of a decentralized, open network, the internet today is made up of a handful of applications that have leveraged their network effects to re-centralize the internet through the creation of walled gardens. Facebook, Google and Amazon lead the pack.

For the three billion people now online, cheap access to the world’s knowledge is an improvement, but it’s not the magical, meritocratic elixir some expected.

The Sovereign Individual, a 1997 book allegedly read by Satoshi Nakamoto, forecast that it would be a new technology of money, not communication, that would decentralize and disintermediate the structure of society in the way many originally hoped the internet would.

“The Information Age implies another revolution in the character of money,” argued authors Davidson and Rees-Mogg.

“This new form of money will reset the odds, reducing the capacity of the world’s nation-states to determine who becomes a Sovereign Individual.”

This “cybercash” should be “unique, anonymous and verifiable” and able to “accommodate the largest transactions” as well as “be divisible into the tiniest fraction of value.”

It would “be tradable at a keystroke in a multi trillion-dollar wholesale market without borders.”

Bitcoin, the first “cybercash” appeared in 2008. Almost perfectly true to prediction, it was unique, verifiable and able to accommodate the largest and smallest transaction.

It was the first example of a new element in our current techno-economic paradigm, blockchains.

Blockchains form an ecosystem of distributed ledgers that use cryptographic protocols to allow for trust-minimized transactions between pseudonymous parties. Along with their associated technologies, they allow for what Nick Szabo has called social scalability: high levels of coordination with low levels of centralization.

Up to now, the internet has been the most socially scalable technology ever invented. It enabled new business models by bringing transaction costs down by an order of magnitude. For the first time, it was possible to participate in the global economy without being part of a large corporation. This spawned a wave of micro-multinationals, so-called “lifestyle businesses” that might operate out of half a dozen different jurisdictions with only a dozen employees.

In the mid-2000’s, it became economically feasible to run a ten-person company manufacturing in China, distributing in North America with developers in Eastern Europe and designers in South East Asia.

Over the next two decades, blockchains will bring transaction costs down yet another order of magnitude. It will enable as yet unconceived of business models.

As we approach a world without transaction costs, the equilibrium size of the corporation trends towards one person.

That person is The Blockchain Man.

The Blockchain Man
(Or A Speculative Sociology of Our Blockchain Future)

The Blockchain Man will be as rich a term half-century from now as the Organization Man is today.

As an exercise, I’m going to try and imagine how blockchain man culture might shape up. I am coming at it from a libertarian-ish perspective. Other perspectives are of course possible (and I hope will be written).

The group from the organization era that most closely resembled the Blockchain Man was scientists, particularly immigrant scientists. They were considered the black sheep of the organization.

The Social Ethic dictated that scientists, like all other members of The Organization, be forced to concentrate on practical problems and work in groups. The research division of an organization was treated in the same way as the management division: well-rounded, team players were promoted above idiosyncratic loners.

And yet, it was the idiosyncratic, loner scientists that contributed most to the Organization’s goal. Bell Labs (AT&T) and General Electric were the two most outstandingly profitable research institutions, which attracted the most consistently brilliant men.

Unlike other institutions, they hired idiosyncratic loners and allowed them to follow the fundamental problems they found interesting without insisting that there be a clear application.

GE’s Irving Langmuir’s work in heated solids led to a new kind of incandescent lamp. Bell Lab’s Claude Shannon’s work on communication theory proved to be immensely practical in the long run, leading to the computer.

Despite their successes, U.S. industry not only failed to draw lessons, but moved in the other direction. They fought to keep their researchers eyes glued on the cash register, sometimes forbidding them from sharing research outside The Organization.

The Organization Man in management hired scientists in his own image when the outstanding scientists of the organization era were almost the direct antithesis of The Organization Man.

The Organization Man could not conceive that a man could dislike the organization and chafe at its emphasis on belongingness. The Organization facilitated the huge quality of life increases he saw during his lifetime. Why would anyone work against it?

The Organization gave man access to the benefits of globalization but required conformity.

Blockchains give the same access but do not insist on the same conformity.

The fat protocol, thin application structure of blockchains means that value will accrete further down the societal “stack.” The scientist’s tinkering around the frontier seemed like a waste to the Organization Man. In a world dominated by blockchains, the value of this tinkering will be more easily captured, and its value more legible.

The outcast scientist of The Organization era, working on the frontier of his field, will morph into the prototypical Blockchain Man.

The Balkanization of Everything: City States are The New Nation States
Unlike previous technologies which formed around geographic centers like Boston or Silicon Valley, blockchain entrepreneurs are relatively decentralized: London, Berlin, Zug (Switzerland), New York, San Francisco and Singapore all have a claim to being the foremost Blockchain City.

As larger nation-states attempt to regulate cryptocurrencies to maintain the political power that controlling currencies gave them in the Organization era, The Blockchain Man will move to city-state like areas. Estonia, Switzerland, and Singapore are the first examples of nation-states competing with each other to bring in high-earning citizens.

The Sovereign Individual imagines a scenario where these high-earning citizens will place all their company’s assets into a bank account domiciled simultaneously in Newfoundland, the Cayman Islands, Uruguay and Liechtenstein. Should any single jurisdiction attempt to withdraw operating authority or seize assets, the assets will be transferred to another jurisdiction.

In the organization era, larger nation states were able to offer advantages by lowering transaction costs through interstate commerce and multilateral trade liberalization. In the blockchain era, the blockchains themselves will cross physical borders better than diplomats ever could, obviating a primary role played by nation states.

The Balkanization that began in the late 20th century with the fracturing of post-colonial Africa and post-USSR Eastern Europe will continue through the 21st century. The city-state will become the organizing unit of global society.

A map of the world if all currently separatist movements were successful
Much like the Catholic Church today, Nation-States will continue to play a meaningful, but secondary role.

Though blockchains will solve many current coordination problems, they will still not solve problems with multi-generational timelines like climate change, for which we will still need nation-states.

The Hollywood Model is the New Career Ladder
This decentralization will affect careers as much as national economies. Blockchains are the hard technology that will take the lifestyle business and free agent economy across the chasm, making it mainstream in the way The Organization Man was mainstream beginning in the 1950s and 60s.

The Blockchain Man’s career will look like a combination of a lifestyle business owner and free agent.

The metaphor of a “career ladder” with its linear, upward sloping path worked well with the corporate pyramid.

In a world dominated blockchains, careers will transform into something more like Sheryl Sandberg’s career jungle gym where each crossbar of the gym may represent a blockchain.

This will result in a career for The Blockchain Man alternating between project sprints and periods of unemployment or mini-retirements, much like Hollywood operates today.

Hollywood is able to bring together large teams for complex movie projects and dissolve them afterwards. Unlike the steady-state jogging of The Organization Man, working in Hollywood is alternating between sprints to get a project done and slow strolls looking for the next one.

Teams of Blockchain Men will come together to work on complex projects in the same way as in Hollywood, but coordination will be improved via tokenization.

Imagine a two-pizza size organizing team that determines the project and issues token token incentives for each role. Each Blockchain Man will complete tasks fitting his skillset and be compensated in tokens.

It will be less top-down coordinated than Hollywood and more market-driven with players responding to incentives, though there will still be hierarchy. Holacracy didn’t work for a reason.

Instead of a paycheck, The Blockchain Man’s income will be a large number of micropayments from past projects. The tokens from different projects will appreciate or depreciate based on the success of the project (and perhaps pay dividends).

Tokenization will make it easier to measure an individual’s contribution to a project and to compensate them based on it.

In this way, tokens will work similarly to royalties. A primary difference will be that the use of smart contracts and removal of third parties mean that even tiny royalty streams can be paid profitably, forming a long tail of income streams.

Tokenization is the ultimate market maker. It will bring bring liquidity to a huge number of previously illiquid assets.

The UX designer of a web application’s onboarding sequence may be compensated in tokens based on the percentage of free trials which become paying customers.

These tokens will also allow a certain amount of voting rights in the project, making projects increasingly subservient to participants rather than organizers, but no less political.

The Blockchain Man Sees the Broader Calculus
Being shoved out of the corporation into a Hollywood-like free agent land, the Blockchain Man will be exposed to a broader calculus of his decisions and tradeoffs.

The Organization Man grew up with the expectation of getting a job and working for the corporation. Unless he is a top executive, he likely has little idea how the game was played or why.

To take one example, most Organization Men do not see the tradeoffs and costs of how they save for retirement.

The Organization Man saves for his retirement in his 401k because his company is matching it. He rarely considers other ways to invest or spend that money.

The free agent might decide that what it means to “save for retirement” is mostly about saving for healthcare costs. He may decide to invest in a personal trainer or meal delivery now, figuring that an extra $200 this month could save $20k in healthcare expenses in 30 years.

There is no way that $200 is going to compound into $20k in any vehicle available to him via his 401k and, even if it could, the quality of life and productivity benefits from exercising and eating healthier today may let him compound that even faster in his own business or freelancing career.

Choosing to invest in your own business or skills is riskier than investing in the S&P 500, but also has a greater potential return. It’s very common for early-stage lifestyle businesses grow at 50% year over year, a number the S&P will never match.

Because of tokenization, Blockchain Man will be exposed to an even broader calculus of the tradeoffs he is making, and their costs, than the free agent.

Tokens will make legible and liquid, many assets that have historically been illegible and illiquid.

The Basic Attention Token puts a tradeable dollar value, however imprecise, on a unit of your attention.

The Blockchain Man will be able to see what he is trading his attention for and make decisions about whether it’s worth it.

He will have an expanded sense of his own agency because he lives in a world without The Organization and Trusted Third Parties.

The Organization Man has a persistent feeling of being watched over.

If he is wronged at work, he can appeal to HR. If his credit card is stolen, he can call Visa.

The Blockchain Man has no such recourse. A transaction on the blockchain, once made, is immutable.

In the intermediate stage we are at, between Organization Man and Blockchain Man, the Organization Man carries his social ethic sensibility of belongingness into the increasingly Blockchain world.

Instead of turning over agency to a boss, it is turned over to the internet guru du jour.

While the Organization Man wants more agency, he fears it. An ability to make your own choices always means accepting responsibility for the outcome of those choices, a heavy psychological burden.

If the 401k or pension disappears, the Organization Man has someone to blame it on. The Blockchain Man has only himself.

The emergence of blockchains will force The Organization Man to reckon with his own agency. How he deals with that reckoning will be the primary determinant of his life outcomes.

Forking, Voice and Exit
One of the ways that reckoning will play out is the increase of forking.

In The Radicalism of the American Revolution, Richard Hofstadter argued that a culture of mass entrepreneurship underlay the American Revolution. Small business owners — blacksmiths, printing shops, and carpenters — formed a culture incompatible with monarchy.

The blacksmiths of the late 18th century America felt a sense of agency in their own personal lives and so the lack of agency they felt in their political lives grated at them.

In much the same way, the sense of agency the Blockchain Man feels in his personal life will form a culture incompatible with The Organization as it exists today.

The result will be a society defined by forking. The balance between voice and exit will tilt towards exit.

Appeals to authority (and perhaps violence) will be replaced by forking. If you disagree with a decision, you can fork a new blockchain.

For the Organization Man, forking was expensive. If The Organization Man worked at a newspaper and didn’t like the editorial direction, he could not simply fork the organization. He would need to go buy printing presses, an office, and hire a new staff of reporters.

To fork a Blockchain is not free either. It requires sufficient scale in terms of users, miners, and broader tooling (wallets, exchanges, etc.).

But, by comparison, it’s cheap.

The Organization required belief in the value of belongingness to maintain the economies of scale that let it support it’s employees.

Blockchains allows dissenters to fork. While it’s likely that one fork will become vastly more powerful, there will be a long tail of smaller chains as well.

Instead of arguing with his boss, The Blockchain Man may fork the project and create his own version.

Instead of protesting against a political party or decision, The Blockchain Man may leave.

Probabilism is the New Determinism
We form our conceptual systems using our day-to-day experience as metaphor.

We understand the human brain better today in part because of the proliferation of computers in our day-to-day lives. It’s easy to use RAM as a metaphor for human working memory because everyone has experienced working on a computer that didn’t have enough RAM: it’s glitchy and the mouse skips instead of dragging smoothly.

When I say “I can’t work on that project right now, I’m overloaded and don’t have enough RAM,” you understand it in a way that someone who has never used a personal computer couldn’t.

The blockchain is at least as rich a metaphorical structure as the computer.

The emergence of blockchains will allow the Blockchain Man to differentiate between dry code, smart contracts, as opposed to wet code, traditional law.

One of the effects of this is that much of what is now opaque and made to appear deterministic will become transparent and shown to be probabilistic.

The Organization Man’s day-to-day experience was deterministic. The organization guaranteed his retirement plan (and in some cases, as with IBM until 1991, his lifetime employment).

There were, of course, clauses in that guarantee (“unless the S&P 500 fails to provide sufficient returns in which case we will chase yield and take on too much risk resulting in huge losses after which we will renegotiate and force your reimbursements down”), but they were never stated explicitly.

This created a day-to-day experience of certainty, of a deterministic and fully legible world, pasted over a probabilistic, illegible substructure.

The wet code of the organization is always made to look dry, black and white.

In the dry code of the blockchain, the clauses are there for everyone to see.

They are written in the open source protocol. The value of your bitcoin is guaranteed unless there is a 51% attack or the miners switch to another chain or a malicious hacker finds a weakness.

The Organization purported to offer guarantees when it was always offering gambles.

Blockchains are explicitly trust-minimized, not trustless. The Blockchain Man’s day-to-day experience is probabilistic, not determinate.

This probabilistic, indeterminate world view will reverberate across the Blockchain Man’s life.

When you work for one corporation and go to one church there is an illusion of eternalism: One, True Answer. Much of what The Organization Man believes to be deterministic today will be shown to be probabilistic in the eyes of The Blockchain Man.

Amos Tversky’s quip that “we are deterministic creatures living in a probabilistic universe” will be no less true but the probabilistic nature of the universe will be more exposed than ever before.

In his best expression, the Blockchain Man will resist reductionism and develop an ability to move between conceptual systems as the needs change, just as he moves between different blockchains depending on his needs.

At his worst, he will descend into protocolism.

Protocolism is the New Nationalism
At his worst, The Organization Man descends into the tribalisms of nationalism, racism, sexism or corporatism. The Blockchain Man at his worst descends into the tribalism of Protocolism.

Each blockchain protocol will have its own maximalists (the blockchain equivalent of supremacists) who believe that it is the One, True Chain.

For both the Blockchain Man and the Organization Man, this grasping at eternalism is an attempt to satisfy a deep human need for belonging that seems to be possible only by exclusion of an out group.

Not only does protocol maximalism serve a human need for tribal belonging, but it also makes maximalists richer. The incentives driven by crypto economics mean that once you own a currency, your incentive is to make it go up in value.

We already see this happening; protocol specific subreddits generate and report news that supports their holdings and discredit their anti-portfolio.

r/Bitcoin trashes Ethereum and promotes Bitcoin, r/Ethereum promotes Ethereum and trashes Bitcoin.

The Selfish Coin
Where the Organization Man’s world was defined by The Organization, The Blockchain Man’s world will be defined by markets.

Even something as simple as commuting will be market driven.

What happens when you mash blockchains, Uber and Self-driving cars together? The self-owning car.

A car that pays for its lease, its insurance, and its gas, by giving people rides. A car that is not owned by a corporation. It is a corporation. The car exists as an autonomous financial entity, potentially with no human ownership.

When the Blockchain Man gets in the car, he will see a sliding scale offering him the ability to set an arrival time and calculate the cost of the ride. If he wants to arrive quickly, the car will make a flurry of micropayments to other cars allowing it to pass. If he’s not in a hurry, he may choose a later arrival time and lower fare, allowing other cars fly past in return for the lower fare.

Smart refrigerators will likewise create a highly liquid, ongoing market for groceries, buying and bidding on groceries based on user settings and their current contents.

In some ways, the Blockchain Man will be a slave to markets. Though markets have many benefits, they don’t extend extra vacation time or mourning leave after a loved one dies.

The Organization served as a shield from markets. In the worst cases this created rent-seeking bureaucracies. In the best cases, it served as a humanizing intermediary.

Blockchains in their totality can be thought of as The Selfish Coin (ht Joe Kelly for coining the term).

In the same way that Dawkin’s Selfish Gene showed humans as merely an elaborate construct of the gene to propagate itself, The Selfish Coin thesis sees The Blockchain Man as a mere tool of the protocol.

The genes which survived were the ones which created organisms most capable of surviving and reproducing, not the ones that made organisms happy or fulfilled.

The blockchains which survive will be the ones which have the greatest fitness for their environment, not the ones which make The Blockchain Man feel happy or fulfilled.

From the perspective of The Selfish Coin, the religious overtones of the early blockchain adopters is a feature rather than a bug. The fervor and obedience which the Organization Man showed to the organization will not disappear, merely transmute.

The Protocol Ethic
The Organization Man was defined by the Social ethic which emphasized the individual as subordinate to the group, the importance of belongingness, and The Organization as the means to achieve belongingness and achieve the proper subordination of the individuals to the group.

The Blockchain Man’s world will be defined by the three tenets of the Protocol Ethic.

a belief in the individual as the source of creativity
a belief in serving the needs of the protocol as the ultimate purpose of the individual
and a belief in the application of blockchains to achieve an individual’s highest potential.
The Blockchain Man exists as a unit of the blockchain. Of himself, he is isolated, meaningless; only as he collaborates with the blockchain does he become worthwhile, for by sublimating himself to the blockchain, he helps produce a whole that is greater than the sum of its parts.

** All credits goes to https://www.ribbonfarm.com/2017/10/10/the-blockchain-man/ **

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