Here is my commentary on the Stanford Encyclopedia's article on Fichte.
First to note, Fichte famously did away with the thing-in-itself early in his career. He wanted to establish a very fact upon which all philosophy could be based. Was this just the cogito?
*The published presentation of the first principles of the Jena Wissenschaftslehre commences with the proposition, “the I posits itself”; more specifically, “the I posits itself as an I.” Since this activity of “self-positing” is taken to be the fundamental feature of I-hood in general, the first principle asserts that “the I posits itself as self-positing.”*
So the I is in some sense prior to itself, hence the strange loop.
*Unfortunately, this starting point is somewhat obscured in Part I of the Foundation of the Entire Wissenschaftslehre by a difficult and somewhat forced attempt on Fichte’s part to connect this starting point to the logical law of identity, as well as by the introduction of two additional “first principles,” corresponding to the logical laws of non-contradiction and sufficient reason...*
I think this is more important that it seems. The I is necessary AS intelligent. The law of identity, non contradiction, and sufficient reason are part of the fabric of the "I posit" as if the I flows logically from it's own nature. The I can only posit an intelligent self that thinks
*"To posit” (setzen) means simply “to be aware of,” “to reflect upon,” or “to be conscious of”; this term does not imply that the I must simply “create” its objects of consciousness.*
Not "simply create" but create in a sense that there is no thing in itself. But the empirical I does not do this. The I of the body is IN the world as born and living
"The principle in question simply states that the essence of I-hood lies in the assertion of ones own self-identity, i.e., that consciousness presupposes self-consciousness (the Kantian “I think,” which must, at least in principle, be able to accompany all our representations). Such immediate self-identify, however, cannot be understood as a psychological “fact,” no matter how privileged, nor as an “action” or “accident” of some previously existing substance or being. To be sure, it is an “action” of the I, but one that is identical with the very existence of the same.*
Fichte was in a pickle. He didn't want to "say" we create the world or ourselves, but he puts himself in between saying we do and we don't in such a carefully balanced act that his philosophy must fall to one side. Everyone seems to agree he was an idealist. The encyclopedia is pointing out his hesitation on this
*In Fichte’s technical terminology, the original unity of self-consciousness is to be understood as both an action and as the product of the same: as a Tathandlung or “fact/act,” a unity that is presupposed by and contained within every fact and every act of empirical consciousness, though it never appears as such therein.
This same “identity in difference” of original self-consciousness might also be described as an “intellectual intuition,” inasmuch as it involves the immediate presence of the I to itself, prior to and independently of any sensory content.*
The difference between the empirical I and the transcendental I!
*To be sure, such an “intellectual intuition” never occurs, as such, within empirical consciousness; instead, it must simply be presupposed (that is, “posited”) in order to explain the possibility of actual consciousness, within which subject and object are always already distinguished. The occurrence of such an original intellectual intuition is itself inferred, not intuited...*
As bodies we are not aware of our source of consciousness directly
*A fundamental corollary of Fichte’s understanding of I-hood (Ichheit) as a kind of fact/act is his denial that the I is originally any sort of “thing” or “substance.” Instead, the I is simply what it posits itself to be, and thus its “being” is, so to speak, a consequence of its self-positing, or rather, is co-terminus with the same*
If it was a substance it could not create itself in any sense whatsoever. It would just "be". As an act which establishes itself, it can "be" prior to itself. Being prior to itself, it can be self conscious by reflecting on the I it is prior to