The Ship of Theseus is an old philosophical thought experiment. It asks a question about identity. Suppose you replace all of the boards of a ship with new ones—is it still the same ship?
We are not going to try to resolve this millennia-old paradox. Instead, we are going to add one more element, and then tie it to the monetary system. The additional element is what if the replacement boards are adulterated in some way. That is, each new board is warped, or weakened, or otherwise not fit for purpose.
It should be clear that replacing boards with unsound wood does not alter reality, only the ship. It does not remove any constraints such as the need to be watertight. It does not make anything better, only adds new flaws.
Let’s call this new ship, with each original board replaced with these adulterated boards, the Zombie Ship of Theseus. It looks like the Ship of Theseus. However, it does not work like it. It has been corrupted to work in a different way, i.e. to lull sailors into going out to sea, where a storm will drown them.
The History of our Warped Monetary System and Currency
So how does this relate to the monetary system and the currency? There has been a centuries-long process of replacing important boards. Let’s highlight the key changes.
The Original System
At the Founding of America, there was the original Ship of Theseus. One had the right to deposit one’s gold (we will leave out silver, as this complicates the story somewhat) and get a paper bank note in exchange. Or one could keep one’s gold, if one did not like the terms. One had the right to redeem the note, and get one’s gold back…
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