Friday, October 5, 2012

Politics: Society 2.0: Economics

We are rapidly approaching a point at which the old economic models fail. Most unskilled and semi-skilled labor can be automated. Goods (digital books, and more recently 3D printer templates) are beginning to move to replicable formats, not as a result of the ability to re-create the work that went into their creation, but as an inherent property of their existence.
The following material is flagged Red Level. It deals with the blogger's original ideas, personal beliefs, and delusions; and might not be believed by any expert in any field anywhere.
On the one hand, with unskilled and semi-skilled labor being replaced by machines and programs leading to the end of  what parts of trickle-down economics actually worked, and the increasing replicability of goods leading to an end to scarcity, some new economic model is needed. One person being needed to maintain the machines that do the work that would otherwise take a hundred people would naturally lead to massive unemployment, especially among the segment of the population that doesn't have the education to maintain the machines. Anything replicable can be pirated, and a lot of replicable things are open-source anyway; so scarcity is no longer meaningful as a source of value for those things.

On the other hand, some things are inherently scarce. Materials will be scarce until we manage to get cheap fusion or femtomachines. Energy will be scarce until we manage to build a Dyson sphere around the Sun, or harness the quantum vacuum, or otherwise meet all conceivable energy needs. Living space will be scarce until brain uploading is perfected. And there are forms of labor, skilled and unskilled, that will be scarce until a Turing-positive AI is invented.

So how do we handle economics where supply outstrips demand, but only for some things? One of the basic assumptions of current economic theory is that the demand for a good will always exceed its supply. It would be fairly easy to turn this on its head if it were universal (after all, if people aren't getting paid much, that's fine as long as prices drop by the same ratio at the same time), but it isn't. In other words, how do we ensure that workers can eat while at the same time ensuring that they work, when food is more expensive than work?

Note: If anyone reading this has any background whatsoever in economics, even just having declared it as your minor the semester before you dropped out, please comment and tell me what you think of this. I have no background in economics beyond having taken a class in it in high school from a teacher who apparently considered pushing a Libertarian agenda more important than actually teaching.

Plan: There are a few basic parts to the Society 2.0 solution to these problems:
  1. Handling Unemployment: In order to ensure than there aren't people starving in the streets, it is necessary to provide both things to keep people from starving and things to keep people off the streets. To do this, a progressive income tax would be applied, with no exemptions. The revenues from this tax would go toward providing a basic allowance in necessities to all individuals (that is, the basic allowance is available to rich and poor alike). This allowance takes the form of a ration in food, water, shelter, communications and information-processing technology, communications bandwidth, transport, health services, workshop access/fabrication, and other items that can be obtained at public facilities dedicated to that purpose.
  2. Encouraging Production: Of course, items above the basic allowance would require some form of other income. I propose two solutions to that: a modified form of traditional capitalism (explained below), and public service (also explained below).
  3. Modifications to the Economy: There are two partial economies in play in a Society 2.0 economy: a capitalist economy based on a law-backed debt currency, and a gift economy based on name and reputation. The first of these is identical to the existing US economy, except with a different tax scheme and effects resulting from the interface with the gift economy. The gift economy, on the other hand, is something relatively new. The gift economy uses a person's reputation as currency, with the act of providing a good or service to another being announced by both provider and receiver to a social network.
  4. Public Service: All forms of government work other than leadership are handled by people hired for those tasks. The hiring is voluntary on both sides, and is for pay. In addition, any person may arrange for the government to buy their debts, with both the cost of the debt and the debt itself owed by the debtor. This work can be done to "work off" any debt owed to the government, whether one bought off or one levied as a sentence.
 Implementation: Of these revisions, the only one that is not a strictly legal matter: establishing an alternative gift economy. However, there are some problems with a strictly legal solution. A culture's laws reflect the culture, and if the laws do not fit the culture, they will not be obeyed and will be removed. The culture must be shifted toward acceptance of these policies, through a long-term campaign of persuasion.

Of course, the rep economy would need to be established through individual-level activity. It can be created at any time, by beginning to act in ways consistent with its structure. People can agree to set up barter and reputation economies where possible.

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