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Will Trump Drain the Swamp with Blockchain?

By: Tho Bishop

Earlier this week Donald Trump took steps to streamline the executive branch. As the summary of the order reads:

This order is intended to improve the efficiency, effectiveness, and accountability of the executive branch by directing the Director of the Office of Management and Budget (Director) to propose a plan to reorganize governmental functions and eliminate unnecessary agencies

While this is being sold as the first step in fulfilling Steve Bannon’s promise to “deconstruct the administrative state,” it is important to acknowledge that we’ve heart such rhetoric before. The Obama Administration also made nominal gestures to “consolidate, streamline, and improve” government agencies during its first 100 days, with then-OMB chief Peter Orszag being sold to the press as a “deficit hawk” who was “nerd sexy.” The meaningfulness of this executive order will depend entirely upon Mick Mulvaney, the man who now holds Orszag’s old office.

Mulvaney also has built a reputation as a deficit hawk, and one of the few Republicans in Congress who understood that spending cuts had to include the Pentagon. If Trump, Bannon, and Mulvaney, however, are serious about changing business as usual in Washington, the administration will not be content in merely cutting a few staff positions or shutting down a few redundant programs. Instead they should look to genuinely change how government is run by utilizing blockchain technology.

Blockchain is the technology behind Bitcoin and other cryptocurrencies, a transparent electronic ledger that enables safe, secure peer-to-peer transactions.

Utilizing blockchain should be a natural fit for Mulvaney, who earned a reputation as the “Bitcoin Congressman” due to his interest in cryptocurrencies and his skepticism of the Fed. The last few years have seen public recognition for the potential of blockchain move from libertarian websites to the mainstream, thanks in large part due to leaders like Patrick Byrne of, the first company to utilize blockchain for stock offerings. It’s Byrne’s goal to see the blockchain handle most of the functions now performed by Wall Street.

Blockchain has also caught the attention of politicians in Washington, and not only because the SEC is terrified that it can’t control Bitcoin. A “Blockchain Caucus” has recently been formed by the bipartisan duo of Dave Schweiker and Jared Polis, with both politicians openly talking about the potential it has for government applications — including more secure “health records, tax returns, voting records, and identity management.”

The US Post Office has already begun investigating ways blockchain could improve agency efficiency. Meanwhile other governments have already put blockchain to work, with the Republic of Georgia being the first country to utilize it for land titles.

Of course, the entire idea of the Federal government being made more efficient seems even more absurd than a reality TV star becoming president. As Murray Rothbard pointed out in Man, Economy, and State:

[Government] personnel have no incentive to be efficient. In fact, the skills they will develop will not be the economic skills of production, but political skills — how to fawn on political superiors, how demagogically to attract the electorate, how to wield force most effectively. These skills are very different from the productive ones, and therefore different people will rise to the top in the government from those who succeed in the market.

To this point, the biggest losers to any movement towards blockchain would be the Federal bureaucratic class, with many of their jobs dependent upon tasks such as verifying government paper work and conducting audits. This is, however, precisely why blockchain could be attractive to people like Trump and Bannon, considering the open hostility most Federal bureaucrats have for the Trump Administration.  

Now many libertarians would argue that nothing good can come from government becoming more efficient, and it’s a fair point to make. But for those that see a roll back of the current bureaucratic state a win, the potential for blockchain to make meaningful gains should not be ignored. Further, hopefully normalizing blockchain technology within Washington will help create renewed interest in Ron Paul’s competing currency bill — which could allow Bitcoin and other cryptocurrencies to compete freely with the dollar which would be the biggest blow to the current centralized state. Doing so would put Trump’s idolization of Andrew Jackson beyond mere symbolism.

Many pundits credited Peter Theil’s attraction to Donald Trump’s campaign to the venture capitalist’s love of “disruption.” That connection would make sense. Disruptive technologies are valued in the market for the value they create for consumers, at the expense of those employed in outdated models. Populist politics behaves in much the same way, with the public as a whole deciding it is better off without the elites of the past.

By utilizing blockchain – and Bitcoin –  the Trump Administration has the potential to employ disruptive technologies in pursuit of draining the swamp.

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