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What it argues
The Sovereign Individual, published in 1997, is a sweeping argument that the rise of digital technology and cryptographic money will break the monopoly nation-states have held over taxation, violence, and the terms of economic life. Davidson and Rees-Mogg frame history through the lens of what they call "megapolitics": the underlying balance of physical power that determines how societies organize themselves. Each shift in that balance — gunpowder, the printing press, the industrial revolution — dissolved one dominant institution and created another.
Their core thesis is that microprocessors are as profound a force as any of these earlier transitions. Information can now be encrypted, wealth can be held in forms that are physically untaxable, and skilled individuals can route their economic lives around any jurisdiction that becomes extractive. The sovereign individual, in their telling, is a person wealthy and technically capable enough to opt out of the coercive bargain the nation-state has offered for two centuries: protection in exchange for compliance and taxation.
What it gets right
- 1.
Megapolitics governs history: the physical balance of power determines what political institutions survive and which collapse, not ideology or moral progress.
- 2.
The printing press, gunpowder, and industrialism each destroyed one ruling class and created another. Microprocessors are doing the same thing now.
- 3.
Cryptography enables wealth that cannot be taxed by territorial governments. The authors predicted something essentially identical to Bitcoin in 1997.
What it covers
Who wrote it
James Dale Davidson is an American investment analyst and political economist who co-founded the National Taxpayers Union. William Rees-Mogg was a British journalist and editor of The Times of London from 1967 to 1981, and later a member of the House of Lords. The two co-authored a series of books beginning with Blood in the Streets (1987) and The Great Reckoning (1991), all developing the megapolitical framework that culminated in The Sovereign Individual. Rees-Mogg died in 2012. Davidson continues to write on investment and political economy.
