DAOs, the next 5000 years?
David Graeber’s book, Debt: The First 5000 years, is a fantastic read.
Graeber takes the reader on an encyclopedic ride through the chronological and ideological history of debt, a social contract and cultural phenomenon based on communal trust, which, he argues, predates both trade and currency.
I see DAOs as an extension of Graeber’s humanistic credit-based economy. A DAO can offer services for its own tokens and can issue tokens (debts) for services rendered to it.
Let me explain.
Graeber calls into question the commonly understood genesis of debt, markets and mediums of exchange.
Graeber documents ‘humanistic economies’ as having communal systems to which and from which people of the community provided or provisioned themselves. These items were accounted for by a community keeping tallies or ledgers.
I imagine that early communes based on the above, if sufficiently large and well managed did provide improved standards of living. However, such economies eventually grew needs beyond capabilities and so became limited and faced various ‘tragedy of the commons’ problems. Hence, the reason they are forgotten (see tower of Babel below)
Most interesting in Graebers’ humanistic economy is the idea of debt. When someone performed a service for or deposited goods into the commune, the commune owed them, or indebted itself to them, in return.
The conclusion is that credit has its origin in humanistic economies and predates mediums of exchange and fiat. Individual debts and credits to the commune were personal and known to all. Most provoking of all is that, if everyone paid their debts, there would be no ‘money’!
According to Graeber, it was only when people wanted to trade with unknown parties did they use precious commodities like salt and gold — as there was no public/communal, agreed-upon ledger.
Furthermore, it was only later that the commune above, keeping track of non-fungible debts — as in: Joe mowed the lawn for the group and so the commune owes Joe a mowing job — moved to fungible, or generalized, debts. This stimulated debts to create super communes or states. These super structures financed themselves by mandating taxes payable in the same community generated fungible debts . The purpose of the above scheme was usually funding an army (or, I should say pre-funding an army).
Broadly defined DAOs, very large, diverse communities or ‘the state’ can lead to dysfunction or the tower of Babel problem. Allocating and generating resources for any group will have scalability limits.
Blockchain shared ledgers give DAOs another chance at forming humanistic economic communes. A DAO can specialize for the needs and purpose of a group.
Imagine a DAO that writes open-source software for IOTs. A developer can contribute software and receive DAO tokens. On another job, this programmer may need help or code written by other experts participating in the DAO. He could redeem a few tokens for work or services rendered to him from the DAO.
Or a simple project finance DAO to manage the finances for a trip made by its participants.
Could the idea of humanistic economies have a DAO-naissance!?
Consider the inefficiencies of many current inhumanely large governments and institutions, and I think so.
Read some good ‘cliff notes’ and/or get the book here https://blas.com/debt/