Litmocracy
About me: I'm doing my best to be peaceful, non-violent, and humble as I seek epiphanies and try to help others find them too. I identify with my kids and everyone that my life will affect into the future, so I take a long term view of things. Religion and taxes are avoidable evils. Spirituality, freedom, individual sovereignty, and voluntary cooperation will eventually replace them - maybe in my lifetime if you help.
Friday, October 11, 2024
Bee-ing
Thursday, June 13, 2024
Dave's Narrative
This is a request and a description
Part I
(in which I try to help you)
I said "It's like with apples: There are people eating apples and people growing apples. The government sees that the people eating them have money that ends up in the hands of the people growing them, and concludes that there is a money transmission business between them." Nathan (my lawyer) said "Yes, but bitcoin is not apples. It's money."
I eventually got him to explain that he is presenting everything from the government's point of view, so what he meant is that the government views bitcoin as money.
I will continue using this metaphor, so keep it in mind. Some of the money that people use to buy apples is stolen, or extorted, or otherwise the proceeds of crime, and so the truckers and grocery stores are helping to launder the money those criminals spend (on apples). The apple industry doesn't need to worry about this because apples are not money.
Under this view that every bitcoin purchase or sale is potentially helping to launder money, my potential co-defendants include everyone I've ever traded with. We will have to wait until the contention that bitcoin traders are helping to launder money is resolved, or the government relieves me of the responsibility to remain incommunicado with my past trading partners before we communicate again. Or I could go back to jail and write y'all letters, but then I need your address, some way to maintain the muscles in my writing hand (since I'll be writing them with a short pencil), and whatever I tell you, I'll be telling them too.
Part II
(with info on how to stay informed)
If you use PACER or RECAP (part of courtlistener.com where documents that should be public can be made public by anyone willing to pay to get them from PACER), you will find two cases with "David Scotese" in them. The first is the prosecution of some cash that was mailed to me by Woody Ochle in 2017, who was under investigation for drug trafficking at some point. The documents I filed do not include all my research, and I forget the reference, so it's possible that I'm misremembering, but I wanted to know how to buy and sell crypto without violating the law (specifically against operating an unlicensed money transmitter business), and to see if I was really doing that. What I remember is that "money" is issued by a central governing authority, which excludes bitcoin, both because anyone can mint it (run a bitcoin miner) which makes it decentralized, and because it is "issued" by anyone who finds a block, it's issued by someone other than a governing authority (most of the time… I have not heard of governments doing bitcoin mining, but now we're getting into weeds).
The second docket you'll find is about my current case. It's June 17, 2023, and I don't think there's anything in there yet from me or my lawyer, so that is the government's version. This is like a reverse class action lawsuit brought by the government against the entire peer-to-peer crypto trading community.
Part III
(in which I pontificate)
Laundering money requires knowledge. In the apple example, the truckers and grocery stores don't usually know whether or not the apples were grown illegally or will ultimately be purchased with ill-gotten gains, and this lack of knowledge means they are not laundering money, but if they do know and it was illegal, then they are laundering money, even though apples are not money.
Money transmission, according to the law as I read it, requires a transaction that is dependent on another transaction. You could view the handing over of a bag of apples to be one transaction and the handing over of $5 as another one, but that is wrong because that would mean every grocery store is a money transmitter. Each transaction has each party receiving one thing and giving up another, and for money transmission, the transmitter is a party to two of them, and one of them is dependent on the other. To me, this means that if the first transaction fails, then the second must be reversed if it happens to succeed. I have actually explained to some of my customers that this is the case when we discuss details of trades. I have not resolved this discrepancy with Nathan because I think it doesn't matter to the government: If I sell some bitcoin to someone who gives me cash in return, there is no second transaction that needs to be done. The government may plan to play fast and loose with the definition of "dependent" in the definition of money transmission. On the other hand, I may be remembering FinCEN guidance rather than statutory language, in case one takes precedence over the other.
Obeying laws is nearly always a good idea, but that requires clear laws. FinCEN exists and publishes guidance on what laws mean specifically because this isn't the case. There is a legal principle called "void for vagueness" which is intended to protect those who attempt to obey laws from getting trapped by poorly written laws. Why would that happen? Because large financial interests recognize threats and motivate legislators to write laws which must not violate the Constitution, but which they want very much to violate the Constitution. Monopolies fail in free markets. If you can scare people into avoiding the exercise of rights you wish they didn't have, that's just as (or even more!) effective as making laws to prevent them from such exercise.
Part IV
(how to stop scammers)
Here is a quote from a letter I send to everyone who mails me cash, or at least to those whose cash comes in an envelope with a return address: "There are few things I want to prevent: A) Scams involving bitcoin, B) conversion of stolen cash or proceeds from the sale of stolen goods into crypto, and C) people like yourself expecting something they will never get."
A "Man in the Middle" (MITM) scam is what it's called when the victim receives instructions to pay for something by mailing a payment to the address of a legitimate seller (of something else). The man in the middle doesn't have the thing the victim wants to buy, but they say they do. They also don't get the payment, the legitimate seller of something else (often crypto) gets it. Once the legitimate seller of crypto has been paid, they send the crypto to whoever answered their ad, and that happens to be the middleman, in a MITM scam.
When this happens, it's too late for my letter to help, so why do I send it? I send it because it also recommends that the victim consider the possibilities and be more careful, just in case they didn't actually answer my ad and in case they are being scammed. I have one letter from a victim of this scam, and it is the copy of my letter that I sent her, with some notes she wrote on it. Typically, a MITM scammer will collect and milk victims with sob stories and explanations of how the previous amount still wasn't enough, or whatever. My letter, I like to think, often breaks that cycle. If the scammer moves on to a new victim and uses me again, the new victim gets the letter too. I imagine this pattern may frustrate the scammer out of scamming.
When you get hurt, it sucks, but it also gives you a lesson. You will eventually learn how to avoid getting hurt in that specific way, but that lesson sometimes comes only after you make the same mistake several times. If and when there is an opportunity for me to see that this is happening to someone who sends me cash, I will consider how to approach it with them. In many cases, the victim and I have conversed on the phone for a while before I was able to convince them to find a better way to help their "friend". I am in the difficult position of helping them to see something ugly where they thought was just some suffering that they could have helped to relieve.
Part V
(Brink of Second Bailout)
What is the point of bitcoin? The very first block has a clue: "Chancellor on Brink of Second Bailout for Banks". The value of any particular stuff is inversely proportional to how much of it there is, and this is true for money too. If counterfeiting were not illegal, a lot of people would counterfeit money instead of doing useful work to earn it. Misrepresenting something cheap as something expensive has always been that particular form of fraud called "counterfeiting", even before any government anywhere wrote a law against it.
After many goldsmiths were hanged because they spent receipts that they wrote up themselves without having received any gold, society craved a better solution. The government stepped in and created the idea of a bank which would fulfill the role of receiving gold, writing receipts, and then managing things ethically. Except it wasn't ethically, and so there were bank runs because the government allowed banks to hold less gold than the receipts they had issued said they held (aka "fractional reserve"), and when people caught on, they scrambled to get their gold before the bank ran out. I think some of those bankers were hanged. I'm not sure. The "federal reserve" is supposed to be the bank that solves this problem, but instead, they made it worse. Austrian Economics describes it pretty well in the Austrian Business Cycle Theory. The "roaring twenties" demonstrate the first stage in which overspending occurs, and the "gr eat depression" demonstrates the second stage. I don't like the see-saw, and it seems Satoshi didn't either. The people who like it like it because they have their hands on the levers and know when to buy and when to sell to milk everyone else. They don't like bitcoin. They are large financial interests and they recognize bitcoin as a threat.
I still want to help them, but not to kill bitcoin. I want to help them leverage their useful skills like security and records maintenance, and to abandon their uglier skills, like getting vague laws passed to weaken the networks and technologies that spring up to alleviate the suffering of my species that results from greed and politics.
Part VI
(is this my fault?)
At the north end of the street on which I grew up (Bellflower Drive), there was a bush with long cylindrical leaves that looked like alien hands. I broke one of these leaves open, curious about what was inside. It was a white fluid called latex. I put a tiny bit of it on my tongue, which immediately got inflamed. I felt the burning travel slowly down my throat as I spit and exhaled violently trying to get the poison out of me. I walked home, still spitting, with a sore throat.
What did I learn? I looked up the plant and discovered that it was one of the most poisonous plants we know about. I encountered it in the wild and survived without hospitalization. I and my brain and instincts worked well enough to keep me alive despite my potentially deadly curiosity. I hurt the people who love me a very tiny bit because they knew I had a sore throat. Otherwise, it was a huge positive. I was already that way before I almost accidentally killed myself, but it suggested something to me: People don't trust themselves as much as they should. A.A. Milne said it through Christopher Robin at the end of Winnie the Pooh: "You're smarter than you think, Braver than you believe, and Stronger than you seem." He also told the bear, "I will be with you always."
There are bad people in the world who are doing bad things and we do have some responsibility to avoid helping them do the bad things. However, I think we have more responsibility to protect ourselves from the bad things they do. I have revised the version of the letter I send to everyone who mailed me cash from the original which you can read here. If you are interested in exploring how I view the world and relate to it in more depth, feel free to search this blog for any term you want.
Friday, January 12, 2024
Letters of Support
Wednesday, November 22, 2023
Molly and Her Freedom
Sunday, May 14, 2023
On how politics causes problems
Saturday, April 22, 2023
Classifying Authority
I see authority as two-faced. It can be good and it can be evil. It is possible for a good person to use evil authority to do good, and that is a wonderful thing except for the effect of encouraging evil authority to persist. It should not, and whatever good the good person accomplishes with it is tainted with that encouragement. I suppose that makes me a purist and I'll have to keep thinking about it. I want to describe what it is, for me, that divides good authority from evil authority.
I imagine that as humanity developed language and discovered that it is often useful both to those who express it and to those who receive it. This is mainly because language gives us the ability to explain things, and some of us figure things out. Isn't it nice that someone who figured something out is able to create language that helps you figure it out too? Now I can drill down to the difference...
"You must not ..." is something that authority says, whether it's good or evil. It is the nature of authority to tell us that we must not ..., or sometimes that we must ... . We wanted a good word to describe those whose declarations turned out to be helpful, and that, in my mind, is where the word "authority" was invented, probably starting out as something like "author", someone who knows enough to write down helpful information. Authorities figure stuff out and then help us navigate reality. I love that!
Sometimes, we question authority, and this is perfectly natural, normal, and helpful. In fact, I think we don't do it enough. There's a reason we don't do it enough though: that too much of the evil side of authority has been at work. The main difference is the answer to the question every child knows to ask: why? Good authority explains how the universe might hurt you if you ignore the claim. Evil authority may attempt to put it in the same terms, but what makes it evil is that the authority itself, or some agent of the authority, will hurt you, not the universe.
Sometimes, we ignore the demand or claim of an authority that tells us we must … or must not …, discover that the authority was mistaken about that claim, and if we are brave enough (which shouldn't be a requirement!) we will let them know. A good authority will analyze this and get back to us, kindly, appreciatively, and either thank us for helping them become a better authority, or point out some risk we took, perhaps without knowing we took it, or both.
A bad authority does not want to change their working model of reality to reflect your evidence that they were wrong , and so instead of thanking you or offering more explanation, they find a way to make it seem like you were wrong, not logically wrong, but morally wrong, for “defying” them. Rather than bending their model of reality to fit the reality you show them, they try to bend you to fit the model they have. They drift from an accurate understanding of reality because we respect them too much to identify their errors. We should ignore them until they improve their behavior.
Every authority can be classified using two questions. The answers to these two questions are nearly always correlated:
What causes my suffering if I ignore the claim that I must or must not do a thing?
What does the authority say should change if I point out that I ignore its claim that I must or must not do the thing, but suffered none of the predicted consequences?
I mean the honest answers, not necessarily the answers that evil authorities give. If they know they are evil, they will likely lie or mislead you if you rely on them for the answers to these questions. Even if they don’t know they are using evil authority, they might lie because they don’t comprehend the full chain of causation for their own behavior and they might think it's helpful to distract you from the truth when they see that it is actually the authority or system that creates the authority that will hurt you when you ignore the claim.
The correlation, once you discover the honest answers is: answer 1 being the authority or the system that created it goes with answer 2 being that you should be the one to change, and any other answer to question 1 goes with the answer that the authority or its expression of the claim should change.
I posted this on my Substack too, which I think is better than blogger.
Saturday, April 8, 2023
To Young Jobseekers
26 U.S. Code § 7701(a)(9) says "The term "United States" when used in a geographical sense includes only the States and the District of Columbia." Sounds good, right? But check this out:
26 U.S. Code § 7701(a)(10) says "The term "State" shall be construed to include the District of Columbia, where such construction is necessary to carry out provisions of this title."
You'll notice that both of these definitions use "include" (or "includes"), so lets add a third one:
26 U.S. Code § 7701(c) says "The terms "includes" and "including" when used in a definition contained in this title shall not be deemed to exclude other things otherwise within the meaning of the term defined."
"Otherwise" isn't defined, so we can take it to mean "What you have when you remove this part," like it means everywhere and always (except in laws, if there are any, where "otherwise" is given a custom definition). So if we do that to 7701(a)(9) & (10), we get these:
"The term "United States" when used in a geographical sense includes only the States and the District of Columbia [and does not exclude other things within this definition]."
"The term "State" shall be construed to include the District of Columbia, where such construction is necessary to carry out provisions of this title, [and does not exclude other things within this definition]."
These are both inane, I know, because there aren't any other things within those definitions! It was written that way to get you to make the mistake of ignoring the definitions. If we ignore the definitions, we would assume that a "US Person" is a resident or citizen of any of the fifty states. But the definitions in the law don't list them or describe them in any way. I think this is because that would be unconstitutional.
Huh??
If citizens and residents of the fifty states were bound by this internal revenue law, the income tax would be unconstitutional because it would then be a direct unapportioned tax; the income tax revenue from each state is not proportional to that state's population. Such a direct tax is forbidden in two places in the constitution (Article 1, Section 9, Clause 1, and Article 1, Section 2). The Sixteenth Amendment didn't repeal the text in either of those places, but rather reversed an earlier Supreme Court decision. The sixteenth amendment allowed a tax on income generated by property without apportionment even if that property was personally owned.
I suspect that, as the folks at weissparis.com explain, if you were born in one of the fifty states, you mislead the IRS if you identify yourself as a United States Citizen, because they are using the definition in their controlling code (26 USC), and that would mean you're a citizen of the District of Columbia. That makes them your landlord because Maryland and Virginia gave that land to them a couple hundred years ago.