They have no actual control over what the miners do, but they have a lot of respect in the community, and most miners are likely to listen to their advice.

It's in the miners best interest to work for the bitcoin economy as a whole since their coins value depend on a coherent response to these types of black swan events.

Its in the banker's best interest to work for the US Economy as a whole, since their money and investments depend on the valid repayment of subprime mortgages.

I don't want to start an argument here, but that's not true; the banks' (i.e., shareholders') money depended on the US Economy. The bankers' money (salaries and bonuses) got paid even after the crisis.

The bankers were playing with other people's money, not their own.

The finance industry went through a huge contraction during the crisis. It was not smooth sailing on some sweet government money.

Sure, they fired a lot of employees, but I wasn't exactly talking about the branch managers or salaried analysts when I said bankers. The Lehman Brothers executives still paid themselves $100M three days before the bankrupcy, and the others weren't exactly on ramen noodles either.

Nevertheless we the people paid for the risk with none of the upside.

Perhaps. But they would have made even more money if the financial crisis never happened. We've got a case where executives make bad decisions for short-term personal gain.

This assumption that people always work for the long-term gain, even for themselves, was proven wrong in the financial crisis. The economy is made up of humans, and humans make mistakes.

Later, you bring up the point of $100 million paid to the Lehman Brothers executives. Do you know how much they got every year ? These guys are paid $50 million / year or $30 million / year PLUS stock options... if they wanted to make more money, they should have kept Lehman Brothers operating for just 3 more years.

The rules governing bitcoin are maintained by consensus, and the bitcoin developers have a large sway on this consensus.

If the majority of people decided they didnt like the current rules (eg all the people complaining about bitcoin deflation) they could very well change them by simple agreement.

It's not really consensus, it's rule by whichever coalition can get 51% of miners.

Not really. For example if 51% (or even 99.99999999999%) of miners decided they wanted to go back to 50 BTC block reward (or even a new 5,000 BTC block reward) that would simply create an incompatible fork. A fork which would most likely be promptly rejected by the consensus of users, merchants, exchanges, and service providers.

One can't simply force a change to the rules. All you can do is make a hard fork in the network. If nobody adopts your hard fork well you can keep mining worthless coins but people can continue to use/mine the existing fork.

Bitcoin is highly resistant to change (almost to a fault). It is a common myth that the person who controls the majority of hashing power can change the rules.

A (malicious) person who controls a majority of the hashing power can change the rules. Central to bitcoin is the idea that the longest chain is the valid one. If you control 51% of the network, you can create a chain that looks however you want it to look, and then publish that chain. Because your chain is longer than the correct one, it will be accepted, and your changes will be accepted. Using this, you can modify the chain to be what it would look like according to your rules.

Of course, this is only possible becuase your chain looks as if it was following the rules. If you have a non malicious computational majority, than any change in the rules would make an incompatible block-chain and a hardfork.

So how hard would it be to get 51% control of the network?

The software is the central authority. As far as I have been able to tell there is no decent specification, like an RFC, that you could use to build other client implementations from so you are all at the mercy of the bugs in a single piece of software.

"The software is the central authority."

The collective "authority" decides how the bugs are to be addressed. Bitcoin is not fully autonomous and without social guidance.

The developers have influence in that they are relied upon to a massive extent to keep bitcoin running.

As far as I can tell this sort of centralisation of influence is a common emergent property in most anarchic human systems.

Luckily if something particularly egregious occurs in this case, the community can easily fork the codebase and start a rival blockchain.

"Homesteading the Noosphere" by Eric Raymond covers exactly this topic. He compares the open source software ownership to Lockean land titles. With Bitcoin, it's interesting since the project itself is a system of value and transactions.

http://catb.org/esr/writings/homesteading/homesteading/

Would they need to start a rival block chain? Or do they just need 51% of the current community to run their clients to take over the current block chain? (as suggested by a comment above)

Technically speaking, getting 51% of the community to switch is still creating a rival block chain. You don't even need 51%. As was the case in this incident, if you have incompatible nodes, the block chain would fork itself naturally.