Tales from the Crypto

Somebody really has to explain cryptocurrency.

As far as I understand it, "crypto"--things like Bitcoin and Ether and Dogecoin and Mallomar--I might have made up one of those—is essentially computer-generated money.  And it's expensive: One bitcoin is currently worth nearly $56,000.  But crypto doesn't exactly retain its value: If you have one bitcoin today, you have something worth about $56,000, but tomorrow that same bitcoin could be worth $57,000. Or $50,000.  Or $1.98.  In other words, crypto behaves more like a stock than a currency.

And I know, I know: Currency behaves like stock, too.  Just as a bitcoin is worth ~$56,000 US, a euro is currently worth about $1.21US, and the euro, too, will fluctuate from day to day.

I also get that crypto, being a "currency" has slightly more--or at any rate, different--utility than stock.  To wit, I can buy something with a bitcoin--if a seller accepts it--that I cannot buy with stock.  Five shares of Boeing won't buy me a ten-dollar toaster, but one bitcoin could.  And I'd get a helluva lot of change.

But, see, the attraction of crypto seems to be more about its skyrocketing value (at least, it was skyrocketing for a while) than for its value as legal tender.  So if I have a bitcoin, I'm less interested in the possibility of buying a $56,000 toaster—although that would be fascinating—than in being able to sell the bitcoin for 56,000 real dollars.  Dollars that, unlike bitcoin, are actually backed up by the full faith and credit of the United States Treasury.  (And, OK, that faith and credit ain't what they used to be--but they're still not bad.)

Which brings me to my next question: What, literally, is bitcoin (or any cryptocurrency)? I mean, you actually can get a physical bitcoin:

But, again, you're not going to walk into a 7-11 and plunk down one of these puppies for a Slurpee.  (OK, for 50,000 Slurpees, maybe. . . ) No, the functional bitcoin is a purely virtual, electronic, ethereal whatsit. It exists in the realm of bits and bytes.  And yet, I constantly hear about bitcoin "mining," which, as far as I can tell, represents the actual creation of bitcoin--analogous to the coining of pennies and nickels and dimes or the printing of dollar bills. And this "mining" is apparently an incredibly energy-intensive process, involving massive amounts of real-world electricity at huge server installations.

But what is actually physically happening?  How is the creation of a bitcoin a more intensive process than, say, the addition or subtraction of funds from a bank account?  I understand it's more complicated than that--it must be, right--but exactly how?  And, by the same token, the creation of a bitcoin--no matter how much energy is expended in its creation--still boils down to some . . . guy. . . somewhere. . .  making up a currency and declaring that it has value.  How is this possible?

Can I just declare the existence of "Solipsist Bucks" and make myself a quintillionaire?  Seems just about as legitimate as anything else.

Can't Believe I'm Doing This

I am now going to do something that I fear imperils my soul: I am going to help the New York Yankees.

Last night, Alex Rodriguez, an admitted steroid user and all-around questionable character, hit the 660th home run of his Major League career.  This ties him with Willie Mays, an indisputably better player and human being, for fourth place on the all-time home-run list.  Whatever.  As Mays himself indicated in a congratulatory message to Rodriguez, records are made to be broken, milestones are made to be passed.

In this story, though, there is an interesting subplot--one that, for a longtime Yankee hater such as YNSHC, is somewhat delicious to observe.  Years ago, when Rodriguez signed his current contract with the Yankees, he was promised large financial bonuses for reaching certain historic numbers.  One of these was, in fact, 660 home runs.  So now, after Rodriguez has served a year's suspension from baseball for violating the league's substance abuse rules, the Yankees have studiously avoided referring to the Mays-tying homer as a milestone--or, as much as they could, referring to it at all.  They will do whatever they can to avoid shelling out a $6-million bonus to Rodriguez.  Rodriguez himself is not really talking about the situation, either.

No one wants to see Rodriguez get this money, but many would also like to see the Yankees fork it over.  Personally, I think if this matter goes to arbitration, the Yankees will lose: They signed a contract, Rodriguez is--like it or not--a player in good standing with the league right now, they have o pay up.  But it seems to me that there's a good, face-saving solution for everyone.

Rodriguez certainly doesn't need the money--his base salary for just this year is something like $25 million.  At the same time, the Yankees can certainly afford to pay: $6-million dollars is couch-cushion money to the Evil Empire from the Bronx.  So both sides should just step up and state that they have reached an agreement to donate the milestone bonus to charity--maybe building little league ballparks or supporting anti-drug programs.  Everybody gets great publicity, a worthwhile cause gets supported, and somebody gets a nice tax write-off to boot.

You're welcome, Yankees.  Now rot in hell.

Money Keeps Talking

The Supreme Court has agreed to hear a case challenging the current limits on the amount of money an individual can contribute to political campaigns.  If the Court's decision in Citizens United--which effectively eliminated limits on corporate contributions--provides any hint as to how this new case will be decided, we can expect that laws limiting contributions will be severely weakened, if not eliminated outright.

I deplore the influence of money on politics, but given the logic--or "logic"--employed by the Supreme Court in previous cases, I see no hope for any other outcome.  Previous decisions have built upon the premise that money equals speech, so any restrictions on a person's ability to spend his or her own money amount to unconstitutional restrictions on one's freedom of speech.  Money, of course, does not equal speech: The fact that candidates cannot reasonably expect to communicate effectively in our current political atmosphere unless they have access to large amounts of cash suggests that money facilitates speech, but facilitation is not identity.  Money should more properly be considered an amplifier of speech: It's a microphone.  And clearly, it should be illegal for a private citizen to provide the candidate of his choice with an overabundance of microphones.

Wait, I just confused myself.

Should it be illegal for a private citizen to provide his or her favored candidate with an overabundance of microphones?  After all, microphones themselves are not illegal.  If we assume (naively, of course, but let me go with this for a moment) that donors simply want to enrich the body politic by supporting people that they (the donors) feel would best serve the public--that, in other words, they are motivated solely by a sense of public-spiritedness--why accept laws that prevent such expressions of citizenship?

Of course, we are not so naive as to believe that sizable donations are given purely out of a sense of citizenship.  Common citizens worry that one-percenters who contribute small (or not so small) fortunes to political actors expect something in return--access, at the very least, if not outright sycophancy.  And it is out of this fear that reform-minded legislators have imposed contribution limits.

Again, if money (under our current judicial regime) equals speech, then limitations on such speech almost of necessity will be struck down.  But assume for the moment that the justices step away from this false equivalency: Would it then be constitutional to impose contribution limits?

Short answer: Yes.

I can't help but think, though, that we will never solve the problem of undue influence until we approach the question from another angle.  Once the debate becomes about spending limits, the fundamental battle has already been lost.

Current law states that the maximum contribution one can make to a federal candidate in an election cycle is $2,500: I suppose the thinking is that a candidate would not be unduly influenced by a donation of $2,500 (or less).  I don't know about you, but, to me, $2,500 is a sizable chunk of change.  At any rate, what is it about $2,500 that divides respectability from corruption?  Someone who donates $2,499 is a concerned citizen, but someone who gives $2,501 is the guy in the trenchcoat demanding that Higgins take a dive in the 6th?  Arbitrariness is no hallmark of solid legislation.  Once we acknowledge that money is a corrupting influence, it seems disingenuous to haggle over an "acceptable" amount of corruption.

We need to change the discussion.  If people truly want to eliminate the corrupting influence of money on politics, there surely are ways this can be done without running afoul of constitutional rights or establishing arbitrary limits that defy common sense.  Public financing of political campaigns would be a good place to start.  A mandated amount of television airtime devoted to public affairs/political broadcasting--with strict enforcement of a "fairness doctrine"--would also help.

If individuals truly want to donate to political campaigns, they should have every right to do so--but how about just mandating that ALL donations go into one gigantic public pool to be distributed equally among all candidates (obviously, there would need to be a way to establish qualifications for receiving these funds, but that's a logistical hurdle to work out later)?  At the very least, all candidates for public office should be required to disclose the names of each and every individual contributor--and corporate donors--whether for-profit or non-profit--should similarly be required to reveal the names of all their funders, as well.

Of course, all these proposals presuppose that anyone in a position of authority truly wants to eliminate--or at least reduce--the influence of money on politics.

So, y'know, never mind.

Who Knows How to Make Money?

A recurring argument in support of Mitt Romney's presidential aspirations goes like this: Mitt will fix the American economy because, as a successful businessman, he knows how to make money.  Mitt Romney undeniably possesses great  wealth, but let's examine the argument that he "knows how to make money."

Mitt Romney's father, George Romney, while apparently a man of humble origins, ran the American Motors Company and served as the governor of Michigan.  It is safe to say that Willard came into this world, already worth at least seven figures.  The man seems to think eating tuna fish sandwiches represents financial exigency.

Barack Obama has humbler origins.  Depending on whom you ask, Obama was either born in Hawaii to a middle-class Kansan woman and her Kenyan husband and grew up in conditions of greater or lesser scarcity, or he is the anti-Christ, born in Kenya and the subject of an elaborate and ongoing conspiracy to mask his unholy origins so he can lead the United States to its ultimate downfall and bring about the Rapture, leaving behing a blasted Hellscape of suffering and deprivation.  Either way, though, the young Barack was hardly rich.  And yet, somehow, even before his election to the presidency, Barack Obama had become quite wealthy, an established member of "the one percent."

So, if we're comparing candidates based on their ability to make money, shouldn't we give the edge to Obama?  Romney changed millions into more millions, but President Obama made millions out of nothing!  Kind of like when Jesus turned a fish and a loaf of bread into tuna fish sandwiches for everybody.

Of course, Romney supporters would probably have condemned Jesus for forcing so many people into the indignity of eating tuna fish.