{"id":14429,"date":"2021-09-19T19:00:00","date_gmt":"2021-09-19T19:00:00","guid":{"rendered":"http:\/\/ci028d7bf64000278d"},"modified":"2025-10-01T15:16:23","modified_gmt":"2025-10-01T20:16:23","slug":"bitcoin-corporations-destroying-economy","status":"publish","type":"post","link":"https:\/\/bitcoinmagazine.com\/culture\/bitcoin-corporations-destroying-economy","title":{"rendered":"Bitcoin Will Decapitate Zombie Corporations That Are Destroying The Economy"},"content":{"rendered":"
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2008 Taught Us Nothing<\/h2>\n

We have experienced (and some of us grew up) during a very interesting blip within history, starting with the events that transpired in 2008 when the tools of our \u201cinnovations\u201d in financialization proved to be the swords upon which we fell. Like the Romans<\/a> of olde, through mechanisms of sheer greed and euphoria, we brought down our own house upon us. And nearly the entire world with it. <\/p>\n

Since that event, regrettably, we have not learned.<\/p>\n

What the U.S. governing body, with the help of the Federal Reserve, did in response to this cataclysm of our own design was to provide a bailout to the institutions most drastically impacted by the climax of the global financial crisis via the Emergency Economic Stabilization Act<\/a> (EESA). This bailout was a play to sacrifice future value in exchange for providing immediate value through debt and debasing the purchasing power of the currency. By taking on debt (or a promise to pay back the loan at a later date in exchange for monetary value now), these entities that mismanaged their financials were allowed to remain afloat. Now, yes, doing this allowed some individuals to maintain their livelihoods and avoid doom, but for many others there was no such relief. <\/p>\n

Also to be considered: that debt was a debt that was decided upon by the few, but burdened the many. By \u201cthe many,\u201d I am referring to the entire population of the United States of America. When we look at the national debt, it is a representation of the sum of the parts; it is not compartmentalized so that, \u201cwell, this debt is for those folks to cover, that isn\u2019t my responsibility.\u201d At that moment, all of us shouldered that debt. From the second the bailout was decided upon it became all our problem \u2014 from every child to every senior citizen<\/p>\n

At that very same time, the bailout did one other thing. It showed the banks and corporations that the U.S. government was willing to push the responsibility off of the \u201cjob providers\u201d and onto the labor force (the citizenry) by way of national debt and kicking the can down the road. <\/p>\n

Imagine you\u2019re working a job and that job is very competitive. You earn a decent living by it, but it\u2019s so competitive that you must work to make sure that you are staying on top of the competition \u2014 working to understand your industry better, learning to be more effective and more efficient with your time. You\u2019re working towards the goal to be the best that you can be in order to prove to the market that your labor is worth the price.<\/p>\n

Now, let\u2019s imagine that one day an individual walks into your office or shop and notifies you that your paycheck is now guaranteed each month, that you need not worry about providing for yourself and your family. What happens to your mind? You relax. You don\u2019t need to try as hard because you no longer need to worry about being the best in order to maintain your income. Now there\u2019s no pressure to be the best in order to justify your price for your services \u2014 it\u2019s guaranteed! What happens to your work ethic? Do you try as hard? Now, excluding the few individuals in society that are driven to be the best regardless of compensation (which is the very, very few), you don\u2019t try as hard. Why? <\/p>\n

You are incentivized to do the opposite. When the reward is guaranteed regardless of the outcome, you\u2019re incentivized to do as little as possible because that\u2019s efficient. It is what makes the most sense! Why do more when you\u2019re compensated equally regardless of the amount of effort that is put forth?<\/p>\n

After that little scenario, consider being a company that is in the same position. Let\u2019s even say that the company is still motivated to attempt to be the best, regardless of the income guarantee. There is still one factor that is missing that helps push individuals forward: fear. <\/p>\n

If a company no longer has to fear that their decisions may cause the company to fail and lead to the loss of livelihood for their workforce, then what is the likely outcome? In my oh so humble opinion: the company begins to make foolish and reckless decisions. Risk management goes out the window. There\u2019s no longer any risk! <\/p>\n

While the incumbent company is lacking in fear because of its guaranteed backstop by the government, it is also not innovating. And yet their protected can\u2019t-fail market position prevents new upstart companies from disrupting their status quo. In a world where these zombie corporations weren\u2019t kept on life support, a new company would be able to gain marketshareas they develop products that are produced more cheaply and more efficiently than those that are currently dominating the market. This is accomplished by newer ways of thought that the current masters were incapable of realizing, otherwise the incumbents would be doing so already. This is a process known as creative destruction, a process known in nature as Darwinism, natural selection or the life cycle. <\/p>\n

This is also the process by which wildfires can burn down a forest<\/a> and clear away the underbrush, allowing for a specific species of plant that requires heat to wake their seeds from dormancy to take root. And so a few short years after the death and destruction of the fire, there is another beautiful, thriving forest. It is a natural process. <\/p>\n

The Disruptors Disrupt <\/h2>\n

This cycle of destructive renewal is akin to a peasant rising from the gutter and becoming the king. But that new king is destined to eventually be overthrown by the next ascendant regime. It is a guarantee of natural life: disruption and chaos. Order leads to chaos, and out of that chaos comes a new order. That new order will be disrupted by a new chaos and the cycle repeats.<\/p>\n

Would Facebook or Twitter exist today if AOL or Myspace was given free money to maintain its level of dominance that it experienced in the early days of the internet?<\/p>\n

These zombie corporations<\/a> have become a massive drain on our economy and society. When so many are allowed to exist, life itself stagnates. Remember the days when the new smartphones were all the craze because the next model actually did something new? When was the last time we had a product enter the market that was revolutionary, that caused a buzz of excitement and demand? Tablets don\u2019t count, they\u2019re just an iteration of the touchscreen phone. And don\u2019t you dare come at me with suggesting the latest smartphone \u201cbEcAuSe Of iTz CaMeRa.\u201d<\/p>\n

This lack of innovation is a signal that zombie companies are suppressing and handicapping our markets, a signal which is getting ignored at an alarming intensity. Danielle DiMartino Booth added an angle to this topic in her discussion with Michael Ippolito of Blockworks that I had not considered prior: as these companies are kept on life support, our labor market is also being denied entities that would be supplying job creation. This is relevant because, as I mentioned, disruptors enter the market and provide a new way of doing things.<\/p>\n

These disruptors provide jobs, albeit jobs that can be deemed as a bit more risky, but they are new sources of employment that were not provided by the existing environment. While the disruptors are disrupting, the established power structure is still operating business as usual. Thereisn\u2019t a rapid cascade of job losses if incumbents are allowed to slide into irrelevance (despite what so many anti-change, anti-innovation fear-mongers like to push). These jobs don\u2019t just disappear in a poof of smoke. Technological revolutions take time. This provides a healthy transition period for employment to move with the evolution of technological advancement.<\/p>\n

If we as a species are not being challenged, not allowed to innovate or create better and newer ways, we begin to stagnate and rot. But it is not just our corporations. This plague has gripped every aspect of our societies across the globe.<\/p>\n

This is where Bitcoin the network and bitcoin the asset come into play to disrupt this relationship. What would have happened back in 2008 if bitcoin was involved in the funding of public policy? The banks that mismanaged their customers\u2019 funds wouldn\u2019t have been saved without recourse. Naturally the recourse would\u2019ve been the clients that trusted these institutions with their hard-earned wealth would have lost their funds or the bank itself would have to pay the price tag of facilitating the withdrawal of all client funds from their products, effectively killing the business. Due to the fact that bitcoin is sound money of which there will only be 21 million, no bailout would have been possible. If you violate your customer\u2019s trust to the point of resulting in damage to your customer, you should have to pay for it. It only seems fair. <\/p>\n

Now what if those bankers were actually held accountable for their mismanagement of their customers\u2019 funds? This would\u2019ve been the best outcome, had it happened. But it didn\u2019t. And now we\u2019re living in a society where this activity is incentivized because the precedent has been established: if you do stupid sh*t with your money, the taxpayers will foot the bill and you need not worry. <\/p>\n

Why is this important? Well, which taxpayers pay the most for this bill? The ones paying taxes now or the ones that will be paying taxes in the future? It is our children and our children\u2019s children that will pay this price. As national debt accumulates, there has to be a vehicle of balancing that debt. Whether it be through restructuring the revenue of the country or a default. We cannot continue like this forever. And this is the important aspect: who will be the ones to sacrifice the most? We\u2019re witnessing a divide starting with the Millennial generation; they are pushing off family formation in a manner that America has never seen before<\/a>.<\/p>\n

The cost of having a family is leading an entire generation to push off reproducing until a later time or even indefinitely. When this happens, not only do we have a generation that is resisting the natural order of life \u2014 grow up, find a mate, reproduce and continue propagating the species \u2014 but it is also a massive loss to the nation and civilization. When demographics turn negative, there are fewer children than the previous generation. This also means that there are fewer laborers for the workforce and fewer buyers in the economy. <\/p>\n

Of even grander scale than these metrics? The more children that are born each day with the freedoms bestowed upon us here in America, increases the prospect of a limitless future, allowing the species and society to advance in ways that none of us can imagine. Each soul that is capable of leaning in on their passions is an opportunity for a new approach at a technology or methodology that no other in history has ever attempted before. <\/p>\n

The Path Forward<\/h2>\n

Bitcoiners are the last optimists in the world, it would seem. This is the best part of the Bitcoin community \u2014 we refuse to settle into nihilism and accept that the world is doomed. If you don\u2019t want to work to make our world a better place for the future, that\u2019s fine. We will fix the world one way or the other, but we\u2019d really prefer not to shoulder this burden alone. If we are going to effectively provide a better future, we have to not only fix our current problems, but we also have to uplift our youngsters with our knowledge and experience so that they can start from a better position than we did. From a higher vantage point, a better understanding of the landscape can be achieved and a more accurate map can be devised. The better the map, the better the path forward.<\/p>\n

This process is how we advance as a people. We push our children to chase their dreams. We have to fix the money so that we can prevent these psychopaths in charge from stealing the future from these kids. Once we fix the money, we can begin to fix our schools. It is for this reason that I will be looking into education next.<\/p>\n

This is a guest post by Mike Hobart. Opinions expressed are entirely their own and do not necessarily reflect those of BTC, Inc. or <\/em>Bitcoin Magazine.<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"

The decaying rot of corporations carried only by the fiat machine will come to an end as Bitcoin fixes our money.<\/p>\n","protected":false},"author":2686,"featured_media":7069,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[33],"tags":[1546,690],"class_list":{"0":"post-14429","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-culture","8":"tag-bailout","9":"tag-inflation"},"author_data":{"id":2686,"name":"Mike Hobart","nicename":"mike-hobart","avatar_url":"https:\/\/bitcoinmagazine.com\/wp-content\/uploads\/2024\/12\/image-3-1-1-96x96.png"},"featured_image_url":"https:\/\/bitcoinmagazine.com\/wp-content\/uploads\/2024\/11\/honey-badger-hodl.jpg","_links":{"self":[{"href":"https:\/\/bitcoinmagazine.com\/wp-json\/wp\/v2\/posts\/14429","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/bitcoinmagazine.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/bitcoinmagazine.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/bitcoinmagazine.com\/wp-json\/wp\/v2\/users\/2686"}],"replies":[{"embeddable":true,"href":"https:\/\/bitcoinmagazine.com\/wp-json\/wp\/v2\/comments?post=14429"}],"version-history":[{"count":0,"href":"https:\/\/bitcoinmagazine.com\/wp-json\/wp\/v2\/posts\/14429\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/bitcoinmagazine.com\/wp-json\/wp\/v2\/media\/7069"}],"wp:attachment":[{"href":"https:\/\/bitcoinmagazine.com\/wp-json\/wp\/v2\/media?parent=14429"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/bitcoinmagazine.com\/wp-json\/wp\/v2\/categories?post=14429"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/bitcoinmagazine.com\/wp-json\/wp\/v2\/tags?post=14429"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}