Daily Balajisms – Community theory

Community theory vs conspiracy theory. Emergent behavior of tribal actors.

Recent attacks against crypto in the US, like the Operation Choke Point 2.0, are best explained by what Balaji Srinivasan calls a community theory. It’s not one person pulling all the strings, but rather various competing parts of the federal government, that engage in an emergent behavior similar to an ant colony.

These regulators and the downstream media follow a simple heuristic – “engage in actions that favor Blue America and hurt Red tribe or Grey tribe, ideally both”. It is well understood that simple heuristics can produce complex and seemingly coordinated behaviors – take motorists in Naples or birds following only three simple rules: “1. follow the car/bird in front of you, 2. match the speed, 3. avoid collision.”

Balaji playfully engages with the topic of conspiracy theories on the Upstream podcast and presents multiple framings. The opposite of a conspiracy theory is official story, the accepted view of events. The opposite of a conspiracy theory is a complacency theory. The narrative that tells you to be apathetic – “oh it’s not a lab leak”, “oh there is no virus”, “there is no banking crisis”.

Blue America is bipolar, it constantly switches between total apathy and panic, says Balaji.  There is no calm preparation. The old establishment gets constantly surprised – Trump was a surprise, Covid was a surprise, Ukraine was a surprise. After apathy comes total panic and short-lived total dedication for the Current Thing, only to be followed by apathy again, when the news cycle moves to a new Current Thing.

The Current Thing phenomenon can be viewed as a social scam, similar to a pump-and-dump schemes in stocks or crypto. In financial scams people are defrauded of their money, in social scams people try to gain status by posting about the Current Thing, and destroy the status of people who are not on board with them.

It’s like political arbitrage, another Balajism, – comfort the afflicted and afflict the comfortable – but on a micro or mezzo scale, of days or weeks. It’s not just “buy low and sell high” over years or decades, but I think it’s akin to “political day trading”.

One person’s conspiracy theory is another person’s Schelling point, says Balaji. A Schelling point is a way to coordinate without coordination. If you want to meet someone in London, and you don’t have a way to communicate with that person, you might choose a well-known tourist attraction – like a Big Ben and 12 o’clock.  

Every successful activist movement, every successful startup, and every successful revolution, like the American Revolution, has an aspect of conspiracy to it. Balaji mentions the book Beautiful Trouble, as a how-to manual for conspiracies. Every successful activist movement is in part stage-managed with test cases and stunts.

Community theory better explains many current events than conspiracy theories, because the State has gradually lost its capacity to do moonshots and is challenged by the Network, to use Balaji’s God-State-Network mental model of three Leviathans.

Conspiracy theories ironically often prop-up the State, because they operate under the assumption of the all-powerful State as the prime mover. State capacity in the West is decaying quickly, as witnessed by the Covid half-measures.

In Nietzsche’s times, elites stopped believing in God and started to believe in the State. Agrarian era was challenge by the industrial age.

Today’s couter-elites stopped believing in the State and believe in the Network instead, says Balaji. This secular religion, or a doctrine, from the bygone era of the industrial age is challenged by the network age.

Gov is dead, long live the Network.