The Sovereign Individual: Mastering the Transition to the Information Age (James Dale Davidson and William Rees-Mogg book)

Published 2022-01-06.

The Sovereign Individual sounds like a self-help book, but it’s not really. It’s a history book, I guess? Maybe it’s better to say it’s a futurology book, because most of it is written in the future tense. It was published in 1997, and many of its predictions about the early 21st century have turned out to be startlingly accurate. That fact, along with the fact that Peter Thiel called it the most influential book he’d ever read, explain why people on Twitter talk about it so much.

The organizing principle that Davidson and Rees-Mogg use to think about the course of history is what they call the “logic of violence”. For a given society, you look at the technologies that are available for wealth creation, and then you ask: what does the existence of these technologies imply for the returns on violence? In other words, how much does it pay to steal from your neighbor? In hunter-gatherer societies, it doesn’t pay much. People had barely anything worth stealing, and what they did have would soon go bad. In agricultural societies, by contrast, people had much to steal: cattle, grain, etc. The returns on violence had gone up. This caused changes in the structure of society—most notably, a move toward centralized authorities that could offer protection from thieves, while at the same time requiring taxes to be paid, under threat of violence by the authorities themselves. Davidson and Rees-Mogg believe that all major changes to the structure of society are possible to understand if you think through the logic of violence that is implied by the technologies used to create wealth.

Since this book is about the shift to the information age, the question they ask themselves is: what effect does the proliferation of computers have on the returns on violence? And what does this imply about coming changes to the structure of our society? The answer they give is that in the information age, the returns on violence go down, and therefore the main perpetrators/threateners of violence—governments—become decreasingly relevant. And this leads to the emergence of Sovereign Individuals—people who become, and stay, extremely rich by avoiding taxation. As you might guess, this book is deeply libertarian. I think I saw a Goodreads reviewer say something like, “It’s a handbook for creating the world of Atlas Shrugged.”

I hadn’t spent much time with the liberatarian worldview before this, so it was interesting to do so. Davidson and Rees-Mogg refer to modern democratic countries as “welfare states” or “nanny states”. They think the concept of citizenship will soon be thought of the way we think of chivalric codes of honor. Rather than pay taxes, we’ll think of ourselves as customers of whatever services we wish to buy from governments. They are disturbingly uncompassionate toward the poor. It’s not that they think anyone should be poor, as far as I could tell. It’s just that they don’t care in the slightest if many people are poor. The thing they care about more than anything else is to not overpay for government services. It’s quite an ugly worldview, for the most part.

It’s also a worldview that saw quite clearly many things that were to come in the decades after the book was published. Davidson and Rees-Mogg foresaw cryptocurrency, smartphones, the metaverse, post-truth politics, the rise of both nationalism and wokeism, and even TikTok. I listened to this book on audio, so didn’t take notes, but there are many passages I could quote that you might think were written one or two years ago, not twenty-five.

The style of the book is forceful. They don’t hum or haw, saying “maybe this will happen, maybe that.” Their sentences are declarative and specific. If a book came out today that made such confident proclamations about the future, there is no way I would read it favourably. I would be constantly flabbergasted by the authors’ lack of epistemic humility. This would be especially true if the authors’ backgrounds were as ecclectic and uncredentialed as those of Davidson and Rees-Mogg, two guys who basically just decided to write some books together. So, given that so many of their predictions turned out to be correct, maybe I’m paying attention to the wrong things when evaluating thinkers who specialize in prediction.

I don’t endorse any of the evaluative claims made in this book, but I’m impressed by the predictive ones. And, like I said, it was interesting and instructive for me to spend some time with the libertarian worldview.

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