Sovereign Individual: Mastering the Transition to the Information Age
By James Dale Davidson, William Rees-Mogg
The Sovereign Individual imagines what changes are to come from the Information Revolution. A revolution that will bring in the fourth stage of human economic life; that of the Information Society.
Side note: This book has aged really well. It was written in 1997, and many of Davidson and Rees-Mogg’s predictions have come to be. More importantly, the Sovereign Individual still has value as a guide to intellectually understand the current tectonic power shifts that will define the geography of tomorrow.
In seeking to lay a good foundation for their arguments, Davidson and Rees-Mogg look at other historical moments they identify as similar to today. They are similar in that the balance of power shifted quickly, either to the advantage of centralized authorities or to their disadvantage.
“…the fall of Rome is one of history’s more vivid examples of what happened in a major transition when the scale of government was collapsing. The transitions of the year 1000 also involved the collapse of central authority, and did so in a way that increased the complexity and scope of economic activity. The gunpowder revolution at the end of the fifteenth century involved major changes in institutions that tended to raise rather than shrink the scale of governance. Today, for the first time in a thousand years, megapolitical conditions in the West are undermining and destroying governments, corporate conglomerates, labor unions, and many other institutions that operate on a large scale.”
The authors go on to proclaim that “…recognize it or not, we are living through a change of historical season, a transformation in the way people organize their livelihoods and defend themselves that is so far-reaching that it will inevitably transform the whole of society. The change will be so profound, in fact, that to understand it will require taking almost nothing for granted.”
Since we are in the end days of the behemoth nation-state era, what does that mean for the future?
Well, if we break down governments into three categories:
1.) those run by their proprietors (lords and royalty)
2.) those run by their employees (the modern nation-state)
3.) those run by their customers (ancient democracies and early America)
The authors figure that Sovereign Individuals will be drawn to more nimble, representative, and comparatively cheap ones; generally, those governments which fall into the third category.
Just like in other epochs, centers of power or sovereignties, will not necessarily resemble the nation-state. They could be free associations, leagues, tribes, federations, orders, etc.
No matter the guiding principles, they will be powerful enough to promise their constituents security of life and property.
That isn’t to say that nation-states will allow power to change hands without a fight. Davidson and Rees-Mogg believe there will be increasing violence, just as in other moments of power change. They think nation-states will seek to make examples of those they judge as challenges to their authority. We already see this in how the U.S. has treated individuals like Julian Assange, Edward Snowden, Colin Kaepernick, Aaron Swartz, and Ross Ulbricht.
But, according to the authors, these attempts to stop the tide of change will be futile. It is already possible for wealth to be held outside of state grasp, and increasing numbers of individuals are taking advantage of this fact. Whether it be by taking advantage of tax havens, microstates, or simply playing nation-states off against each other for advantaged citizenship status.
After providing their arguments and predictions for the future, Davidson and Rees-Mogg continue to reflect on societal changes and start descending into racist and misogynistic views. This tarnishes what before was such an unambiguously good book.
The book builds well. It provides clear arguments and reasoning. That many predictions were accurate provides evidence that Davidson and Rees-Mogg did their homework.
For example, holding two or more passports is now common, and fleeing tax obligations with off-shore accounts is more and more accessible, not necessarily for the middle class, but data dumps from tax-havens show how popular these investment centers are. Cryptocurrencies like Bitcoin will add another weapon to the arsenals of would-be Sovereign Individuals.
In fact, cryptographically secured assets are a huge battlefield at present.
True also is that governments are seen with greater and greater disdain. Even their authority over the truth (science and media) is being undermined by more peer-to-peer and self-catered media feeds. Behemoth industries of the 20th Century are easily eclipsed now by more nimble, more information-savvy companies. Just look at the top performers in the stock market in any given year after 2000.
If citizenship and the ideal of loyalty to country go the way of chivalry, we are going to be in for a ride!
I very much enjoyed the Sovereign Individual. Even going back over my notes was enjoyable. Clearly, there are a lot of new ideas to digest. I’m inspired even. I just wish Davidson and Rees-Mogg gave more answers.
How to become a Sovereign Individual?
Anyone seeking to future-proof their life or consider the major ideology shifts which underpin modern and post-modern society should read this book. Crypto-enthusiasts will read with pleasure. High schoolers, in particular, will benefit from reading the Sovereign Individual, as they’ll be able to form themselves better for the future.
For those who enjoyed Dalio’s Changing World Order or Harari’s Homo Deus.
Did you read the Sovereign Individual? Were you inspired too? Am I being naive in my enthusiasm? Please let me know.