Creating a guaranteed minimum income through crypto-coins

[TCraver]

... whether you give everybody $1mm, or mandate the minimum wage at $500/hr, or add a bunch of zeros before the decimal point, or any other way of handing it out, in essence a combination of two things will always happen. 1) You devalue money (call it hyperinflation if you will), and 2) demand skyrockets for everything. Instantly.

What that means is that in a matter of days, prices for goods and services will explode by approximately the same order of magnitude of the amount you skew the system. In other words, in no time flat, the price for a gallon of milk (hovering at say $4.00, today) will hover around $40,000. Which means that the net purchasing power of the poor hasn't really changed at all. This will happen for every single good and service at the same time.

THAT is the fundamental flaw with all of these schemes. Since supply and demand define equilibrium, and since all prices always hover around equilibrium (except when skewed by gov't force (law, regulation, import duties, et cetera) which never increases supply) no one is any better off than they were.

Keep this in mind: if you are going to have to force me to participate in your ideas, that means they suck. Badly. There is a ~reason~ that the pillboxes in East Germany were pointed inward.

First, this is a voluntary system - if you didn't want to take the coins, or even accept them in payment, no one would force you to.  But many and probably most - including you eventually - probably would, precisely because it would NOT suck to get money for little or no effort.  Even if you think the altcoin is going to drive up prices, it makes less sense to refuse them, than to take them to counter-balance the higher prices you project.  So participation would likely be high, even if you were correct about the impact on prices.

Second, the number of coins per capita in circulation would rapidly approach a fixed level, as the number of new coins created is balanced by the decay of the larger number of coins already in existence.  If the decay rate is 2%/week, the total number of coins in circulation would reach about 50 times the number paid out per week, and stay at that level.   

Dollar circulation would slow somewhat, as people would prefer to spend those last.  And sellers would prefer dollars - so prices in dollars would fall somewhat.  However, by taking that and the expected rate of circulation of the altcoin into account, the "correct" value of the altcoin in terms of dollars can be calculated.  At a rough guess, the dollar value of the distributed coins would be on the order of $10 per person per week.  After some initial fluctuation, the altcoin's value relative to the dollar and to goods would end up close to the original estimated level, rather than inflating dramatically, as you speculate.

[1715358938]

1715358938

[TCraver]

Another problem you face is that you will need to come up with a different name.  Mincoin (MNC) is already in existence for some time now.

https://mincoin.io/

https://mcxnow.com/exchange/MNC

No problem.  It's just a placeholder name.  So I'll use a different one, hopefully ugly and generic enough no one will want it.

How about "TheCoin"?  Assuming no one has claimed that, I hear by declare it to mean "any generic coin that I happen to be talking about".

[Impaler]

I would like to understand "decay rate" better. I read that some are in favor of it because it would discourage hoarding, and therefore reduce wealth disparity.

I would also like to debate anyone who thinks there is a better money system than my previous proposal about a Capital Homesteading system using digital currencies. Loaning money into existence for feasible productive projects allows for unlimited growth without inflation, and I believe without decay rate also. I am against interest, especially compounding interest. But if the productive credit is allotted equally to every human, and they invest in dividend-paying companies, everyone will receive dividend income to replace technological unemployment and a capital growth nest egg for retirement. This creates free(er) markets, eliminates redistribution, taxation, and of course reduces wealth disparity. And if the decisions about what entities get new capital come from the largest possible number of people, companies will have to treat employees fairly and respect the environment. Otherwise people will not let them use their productive credit allotment.

This community may be creating the new money system of the world. I know some consider this to be a great opportunity to fix many of humanity's problems. I do, and I hope you will.

This is largely the motivation behind Freicoin which implements 'Demurrage' the technical term for the decline TCraver described, reducing interest rates to zero is the primary goal and reduced hoarding is a means to that end.  I don't believe loaning normal 'hard' money even for productive investments in adequate because interest rates act as a floor for what IS a profitable investment.  Demurrage is designed to cancel the liquidity value of money and it is this liquidity value with gives rise to interest.

I also like the idea of universal ownership of dividend paying stock as a means of universal income and suggested something similar in another thread.

[Impaler]

BTW TC, someone over at Freicoin is also looking to do a universal income experiment also, again as a voluntary layer onto of the coin, you may wish to contact him.

http://freicoin.freeforums.org/application-to-make-an-freicoin-basic-income-experiment-t701.html

[brush242]

... whether you give everybody $1mm, or mandate the minimum wage at $500/hr, or add a bunch of zeros before the decimal point, or any other way of handing it out, in essence a combination of two things will always happen. 1) You devalue money (call it hyperinflation if you will), and 2) demand skyrockets for everything. Instantly.

What that means is that in a matter of days, prices for goods and services will explode by approximately the same order of magnitude of the amount you skew the system. In other words, in no time flat, the price for a gallon of milk (hovering at say $4.00, today) will hover around $40,000. Which means that the net purchasing power of the poor hasn't really changed at all. This will happen for every single good and service at the same time.

THAT is the fundamental flaw with all of these schemes. Since supply and demand define equilibrium, and since all prices always hover around equilibrium (except when skewed by gov't force (law, regulation, import duties, et cetera) which never increases supply) no one is any better off than they were.

Keep this in mind: if you are going to have to force me to participate in your ideas, that means they suck. Badly. There is a ~reason~ that the pillboxes in East Germany were pointed inward.

First, this is a voluntary system - if you didn't want to take the coins, or even accept them in payment, no one would force you to.  But many and probably most - including you eventually - probably would, precisely because it would NOT suck to get money for little or no effort.  Even if you think the altcoin is going to drive up prices, it makes less sense to refuse them, than to take them to counter-balance the higher prices you project.  So participation would likely be high, even if you were correct about the impact on prices.

The issue here is that a significant number of people will accept (from whatever authority) and spend them, but not contribute to creating them or accept them in trade. The effect is that, like with any outside regulation or interference, you skew the market, it corrects very quickly, and in this case, you either devalue money as a whole, or more likely, you end up with two different prices. One for the original currency, and one for the altcoin.

In essence, you aren't "counter-balanc[ing]" anything because all of the costs of all of the materials and labor that goes into all goods and services will skew as well, hence the $40K gallons of milk (If you handed everyone $1MM). Rest assured, the effect on prices has long since been proven.

Second, the number of coins per capita in circulation would rapidly approach a fixed level, as the number of new coins created is balanced by the decay of the larger number of coins already in existence.  If the decay rate is 2%/week, the total number of coins in circulation would reach about 50 times the number paid out per week, and stay at that level.

This fails as well because the purchasing power of money always fluctuates in relation to the world around it. See, for example, how the purchasing power of the dollar has held up over the past 100 years. But more importantly, the costs of the labor and the materials that goes into everything that exists fluctuates as well because of labor shortages, labor gluts, scarcity, demand, consumer preference, technology advances, and on and on and on. The purchasing power of your outside factor is not immune, and if it is geared to lose value, that can’t help.
   

Dollar circulation would slow somewhat, as people would prefer to spend those last.  And sellers would prefer dollars - so prices in dollars would fall somewhat.  However, by taking that and the expected rate of circulation of the altcoin into account, the "correct" value of the altcoin in terms of dollars can be calculated.  At a rough guess, the dollar value of the distributed coins would be on the order of $10 per person per week.  After some initial fluctuation, the altcoin's value relative to the dollar and to goods would end up close to the original estimated level, rather than inflating dramatically, as you speculate.

No. you cannot say “prices in dollars would fall somewhat” because you cannot possibly determine the aggregate outcome of the trillions of personal decisions. Another way to look at this is to assume your coin is a dollar for all intents and purposes. Just as a dollar comprises pennies, nickels, dimes and quarters (or tens, twenties, fifties) in your scenario, the dollar would comprise the normal divisions as mentioned, with the addition of altpenny, altquarter, atten, et cetera. Each of these would have their own value as well, meaning 10 altpennies to a penny, or whatever.

If you only intend to hand everyone $10 bucks a week, then prices will do exactly as I said they would, though they won’t skyrocket. Instead, the price for a gallon of milk will hover around $4.40 instead of $4.00. The net result remains the same as prices will skew higher in close correlation to the amount of altcoin you inject into the system.

[DaveHamill]

What your saying is along the lines of: lets end poverty by simply giving everyone on earth who is poor One Million Dollars!

This, basically, sums up why this and similar ideas are stillborn (and always will be), even with all the machinations being suggested here.

The reason is very simple, whether you give everybody $1mm, or mandate the minimum wage at $500/hr, or add a bunch of zeros before the decimal point, or any other way of handing it out, in essence a combination of two things will always happen. 1) You devalue money (call it hyperinflation if you will), and 2) demand skyrockets for everything. Instantly.

What that means is that in a matter of days, prices for goods and services will explode by approximately the same order of magnitude of the amount you skew the system. In other words, in no time flat, the price for a gallon of milk (hovering at say $4.00, today) will hover around $40,000. Which means that the net purchasing power of the poor hasn't really changed at all. This will happen for every single good and service at the same time.

THAT is the fundamental flaw with all of these schemes. Since supply and demand define equilibrium, and since all prices always hover around equilibrium (except when skewed by gov't force (law, regulation, import duties, et cetera) which never increases supply) no one is any better off than they were.

Keep this in mind: if you are going to have to force me to participate in your ideas, that means they suck. Badly. There is a ~reason~ that the pillboxes in East Germany were pointed inward.

I agree with the gist of what you are saying, but there is a way to have a voluntary system that empowers all of humanity who wish to participate with no possibility of inflation.

[thedarklight]

Here is what I have to say on the subject and I said it in your other thread as well.

By the way biometrics is a start but it will not necessarily be enough.

Choose or be chosen. Every human being should have the option to choose to join a virtual community, or a virtual sovereign nation. The model to use would be micro nations where you must register to receive citizenship and then you can get the dividend. This should include biometrics, a background check, and whatever else the virtual community decides is necessary before accepting an application for virtual citizenship.

Communities should do the choosing. The background check is to make sure you are an honest person and if you pass the checks you can join the community. This would keep scammers and bad actors out of certain communities as some more exclusive communities will not want to support them. It would also allow a community to accept or reject people according to principles.

A citizen of a virtual community would have voting rights and there would be a distributed Constitution of some sort which everyone in the community has found some way to agree upon. This way you would be able to join a community of like minded people and receive your basic income dividend from your community, your micro nation, your virtual sovereign entity. No one would force their values on you because you'd join the community of people who share your values.

I'm working on a white paper that is still a work in progress. You can read it here http://darkai.org/?page_id=41
Give it the peer review.

[brush242]

I agree with the gist of what you are saying, but there is a way to have a voluntary system that empowers all of humanity who wish to participate with no possibility of inflation.

What happens when all of the people who think like I do choose not to participate? Or when you find prices heading up (fluctuating (inflation)) anyway? Or, what if some of the people who don't participate find ways to make a good living--but that tends to undermine the voluntary system? Not through deception or fraud, of course.

What happens then?

[brush242]

Communities should do the choosing. The background check is to make sure you are an honest person and if you pass the checks you can join the community. This would keep scammers and bad actors out of certain communities as some more exclusive communities will not want to support them. It would also allow a community to accept or reject people according to principles.

Principles:

1. Wimmin ain't as smurt as men. No gals allowed.
2. Anyone who took er jerbs is out. You take der jerbs with a new process. Thus, you're out.
3. Don't forget about the damn Dutch...

Are those all okay?

A citizen of a virtual community would have voting rights and there would be a distributed Constitution of some sort which everyone in the community has found some way to agree upon. This way you would be able to join a community of like minded people and receive your basic income dividend from your community, your micro nation, your virtual sovereign entity. No one would force their values on you because you'd join the community of people who share your values.

What if they decided out you go? Could you still deal with the others?

I'll read the paper later.

[brush242]

The thing about all these so-called communities of like-minded individuals that are all "working together" is that you could do that stuff NOW.

Take, for example, the I-think-healthcare-is-a-right-and-everyone-should-have-it-free crowd. Why don't they get together in groups TODAY and provide eveyone in the group with "free" healthcare? They don't need any laws. They never needed any Obiecare. They could have done it, instantly. What the hell was stopping them?

Similarly, free othercoins like those propsed here? What are you guys waiting for?

[thedarklight]

Principles:

1. Wimmin ain't as smurt as men. No gals allowed.
2. Anyone who took er jerbs is out. You take der jerbs with a new process. Thus, you're out.
3. Don't forget about the damn Dutch...

Are those all okay?

It's not principles I would support or associate myself with but every community chooses its own principles and anyone should be able to join with like minded individuals to share profit.

As long as anyone is free to leave and it's not hurting others, all of that is okay.

What if they decided out you go? Could you still deal with the others?

I'll read the paper later.

Then I'm kicked out. That is how a community works. No one is entitled to being part of a community. It's an honor to be a part of a community and some are more exclusive than others.

The thing about all these so-called communities of like-minded individuals that are all "working together" is that you could do that stuff NOW.

Take, for example, the I-think-healthcare-is-a-right-and-everyone-should-have-it-free crowd. Why don't they get together in groups TODAY and provide eveyone in the group with "free" healthcare? They don't need any laws. They never needed any Obiecare. They could have done it, instantly. What the hell was stopping them?

Similarly, free othercoins like those propsed here? What are you guys waiting for?

They seem to think it's easier to blackmail the politicians into doing it than doing it themselves. I guess they don't want to spend the time trying to invent a new system and would rather rely on the corrupt processes of the old system.

But if old methods are outdated or clearly aren't working then we should try different methods. Political methods aren't going to solve every problem and sometimes you have to invent something new to shake things up.

[brush242]

It's not principles I would support or associate myself with but every community chooses its own principles and anyone should be able to join with like minded individuals to share profit.

As long as anyone is free to leave and it's not hurting others, all of that is okay.

Agreed.
 

Then I'm kicked out. That is how a community works. No one is entitled to being part of a community. It's an honor to be a part of a community and some are more exclusive than others.

Okay. So can they kick out the Dutch? Black people? Women? More importantly, would those kicked out, be forbidden from dealing with members of the group, or vice versa?

But if old methods are outdated or clearly aren't working then we should try different methods. Political methods aren't going to solve every problem and sometimes you have to invent something new to shake things up.

So what are you waiting for?

But the larger point was that allmost universally these ideas are basically Ponzi schemes. While certainly there are economies of scale, if 10 people cannot afford the healthcare for themselves, then neither will 50 people, or 100, or a million, or in the US, 340 million, especially since the money used (taxes) loses 50+ percent of it's value off of the top.

This is one of the issues that people wanting "free money (anything)" schemes refuse to address.

[TCraver]

What are you guys waiting for?

The point of this discussion is not to evaluate whether a "minimum income" altcoin is desirable, but rather how it could best be made functional.  If you don't agree that it is desirable, I would ask that you consider creating a separate discussion thread to debate that.

There is a technical issue with implementing a minimum income scheme using TheCoin, which has a potential solution at the "strategic" level, but which needs to be examined at a more tactical level.  Namely, how to prevent rampant use of multiple false identities for extra distributions. 

The strategic level solution to that, which a few have agreed sounds right, is to require a pledge to do (very light) work validating identity of other claimants, as a condition of accepting a coin distribution   (If you can think of a better approach, that would also be welcome.  Do keep in mind that this is intended to work world-wide, without government intervention.) 

The tactical element, of course, is "How would validation be done?"  with particular focus on keeping down the complexity.  And that's not a trivial problem.  As soon as one proposes some obvious method of validating identity of claimants, one also exposes fairly obvious ways to cheat that method.   

For example:  suppose the validation method was to have a randomly assigned person who lives near a claimant, go visit the latter, check that that person lives under the claimed name at the claimed address, take a photo of the person.  But if the latter is a crook, what if he offers the 'inspector' half of his weekly take under the false name?   Now there are some obvious counter moves to that - say always having two random persons check on a claim, and penalizing someone who falsely makes multiple coins or deliberately validates a false identity.  But THAT adds the complex question of how to determine whether someone merely made a mistake, or intentionally validated a false identity.  And what if the validation agent who says the identity is false, happened to know and hate the person they were asked to validate?  Take the thing to a conventional court?  What if this is in a country with a poor legal system?  Do we then add some sort of "coin court" with judges and juries and that whole mess?   Sent three random validation agents and if 1 of them says the claim is false, send another three?

I hope that illustrates the sort of problems that still need to be solved.   You are welcome to make creative suggestions for validating claimants.  Or maybe a way to avoid that requirement altogether.

Note that even once workable methods are conceived, there would still be a technical implementation effort required.

I hope that answers your question.

[brush242]

In the most general sense, it is desirable. Of course. That would be really nice, like ending hunger or not squishing kittens.

However, the costs will outweigh the benefits because your biggest problem (ID aside, that could probably be done with DNA and cryptology, public/private key, PGP, et cetera) is how to hand out free money such that the net result is not exactly the same as the market result available prior to peeps gettin' their free dough.

There's no point to all this not inconsiderable effort if the net result is zero. That is far more important. How will you address that issue?

[TCraver]

In the most general sense, it is desirable. Of course. That would be really nice, like ending hunger or not squishing kittens.

However, the costs will outweigh the benefits because your biggest problem (ID aside, that could probably be done with DNA and cryptology, public/private key, PGP, et cetera) is how to hand out free money such that the net result is not exactly the same as the market result available prior to peeps gettin' their free dough.

There's no point to all this not inconsiderable effort if the net result is zero. That is far more important. How will you address that issue?

Quite simply, it is not true that giving a basic income to everyone would drive the currency's value to zero.  That would only happen if the distributed coins were not withdrawn from the economy.   This proposal withdraws TheCoin at a rate such that the number of TheCoin in circulation quickly approaches a constant per capita.

Do you think so many economists would have seriously proposed a universal basic income, if it were trivially obvious that it could not work?

And the identity problem is not nearly as simple as you think,  provided only voluntary action (no government) is involved.

How will I submit my DNA proof and to whom?  And at what cost?  What if someone else submits my DNA before I do?  What if someone assigned to verify DNA uniqueness decides to charge a small fee to submit fake DNA verifications?

Anyone can generate any number of public/private keys, allowing them to generate new "identities" as often as they wish - precisely the problem we're trying to address.

[brush242]

Quite simply, it is not true that giving a basic income to everyone would drive the currency's value to zero.  That would only happen if the distributed coins were not withdrawn from the economy.   This proposal withdraws TheCoin at a rate such that the number of TheCoin in circulation quickly approaches a constant per capita.

Quite simply, I have not made the point that giving a basic income would drive your currency to zero. I have said that if you give everyone in the country $1MM, the price of milk jumps to $40K, everyone AND the poor become millionaires, and the poor, while millionaires, are no better off in standard of living than they were before your scheme. That's great that they now have millions, but they still cannot afford much beyond basic subsistence.

It doesn't matter whether you give them your currency or dollars or anything else, nor does it matter if you only gave everyone only $100 a week. Your coin value doesn't drop to zero, the prices of everything very quickly adjust under upward pressure to equilibrium via supply and demand, meaning net result to the poor is zero.

Do you think so many economists would have seriously proposed a universal basic income, if it were trivially obvious that it could not work?

It IS trivially obvious that it cannot work, but that doesn't mean economists (or anyone else) accepts that because it ends their ignorant world view. Many economists still don't accept simple, basic principles in economics, because that isn't how they think the world should work. Think Keynes, or Paul Krugman, for example. They WANT to believe (like Mulder) and they will perform all sorts of gymnastics to do so, hence the relatively recent development of over-mathematicalizing economics. Go back to ancient Rome and see what Augustus, Diocletian, and Constantine didn't learn about taxes and economics and what few have learned since.

 

And the identity problem is not nearly as simple as you think,  provided only voluntary action (no government) is involved.

Sure it is. Think Underwriters Laboratories, no one has to get their products certified as safe by UL, yet companies worldwide line up to do so. They are not a gov't organization, nor created by law, so using the certification is entirely voluntary. You would have the YourCoin Certification Association and that is what it would do—certify that x person is who they say they are and then generate public/private keys or whatever for them.

Voluntary action just means you aren’t forced by the gov’t to do something. That you have the YCCA doesn’t mean they are “forced” to do something, they voluntarily choose to get YCCA certified in order to participate in your scheme.

[Cryddit]

In principle, the guaranteed minimum income thing can work. 

It's like a graduated wealth tax, with the lowest brackets actually corresponding to a negative tax.  It'll become necessary as robotic production advances, because fewer and fewer people can be employed in production.  It's in the interest of business owners because they can produce their crap with smaller numbers of employees, but they want to sell to the much larger population of people who aren't getting paid by them anymore.  They can't sell their crap unless a larger segment of the population than can still be employed producing it have money to buy crap. 

But it only works that way if money itself doesn't represent debt anymore and people aren't under the spur to work slavishly to pay back their debt.  And as we know, there is no form of money that isn't made exclusively out of debt -- oh wait, now there is, isn't there?

The free software movement is composed of people who produce value for free, just because they enjoy creating things and believe that someone *should* create the things they do.  The Khan academy provides everyone who wants it and is willing to do the work with a world-class education for free.  Wikipedia and online lookups have taken over from pretty much every publisher of encyclopedias and reference materials by providing a crowd-sourced free service.

The very existence of such people and institutions demonstrates that even given a basic income, there are human beings who won't just sit on their fat asses and produce nothing, because the creative impulse is just too strong.  In fact I believe such people are in the majority; working for extra income can be purely voluntary and I think most people would still do it.  Maybe ten or twenty hours a week instead of forty or sixty, but more than half of them would still do it, just to avoid boredom, or because they want World of Warcraft access, Television, and more than 400 square feet of living space.  And of course there'd still be obsessive types who put in sixty or eighty hour weeks building businesses, because building businesses is what they love to do, what they take pride and identity in.  In fact that pretty much describes the current set of small business owners and CEOs in American business. 

The problem up to now is that such people haven't been able to be productive enough to provide a meaningful small income for everyone.  But that's changing.  Information is replicable essentially for free, and that makes the producers of free software, and the producers of the recorded lectures and interactive software of the Khan academy, and the people producing designs for automatic production shops on Thingiverse, productive enough that these new institutions are now significant contributors to the world economy.  Although measuring their contribution baffles economists a little currently because the price point is zero.  As automatic production facilities get better, it's not that big a stretch to imagine just downloading patterns for whatever you want to produce locally.  Humans can exist in a society where the basics are provided by robotic means and professional production is restricted to luxuries, land, and things not easily autoproduced.

 

[brush242]

“In principle, the guaranteed minimum income thing can work.”

Please enumerate this principle?


“It's like a graduated wealth tax, with the lowest brackets actually corresponding to a negative tax. It'll become necessary as robotic production advances, because fewer and fewer people can be employed in production. It's in the interest of business owners because they can produce their crap with smaller numbers of employees, but they want to sell to the much larger population of people who aren't getting paid by them anymore. They can't sell their crap unless a larger segment of the population than can still be employed producing it have money to buy crap.”

There is an infinite amount of work that can be done, even if that meant building a Dyson sphere or something crazy. Which means that people can always be employed in production, even if that production changes. “Fewer and fewer people” employed in x production just means that surplus labor can be employed producing something else, as is always the case. IF there were so many robots that so many people weren’t working, that would put significant downward pressure on prices, such that more people could buy.

You see, the robots AREN’T cheaper/better generally than humans making cars (for example) but the humans beings decided to put enormous upward pressure on human labor costs. Overtime, healthcare, outrageous hourly rates for mindless work, OSHA regs, vacation, sick time, pensions, 401(k), time of day differentials, bonuses, labor disputes, et cetera, drove costs so high that multimillion-dollar machines became cheaper than all that BS. Smart plan, AFL-CIO/Teamsters, way to price yourselves out of jobs.


“But it only works that way if money itself doesn't represent debt anymore and people aren't under the spur to work slavishly to pay back their debt. And as we know, there is no form of money that isn't made exclusively out of debt -- oh wait, now there is, isn't there?”

No, there isn’t. There are mining costs, electricity costs, opportunity costs, et cetera ad infinitum. Money is just a medium of exchange for labor, period. Whether you work for dollars, or work for somefreecoin, the system remains the same. You trade your labor for value, regardless. Crypto currencies don’t change that. To earn crypto, you trade your labor for electricity and miners, and all the rest of it, just like you do for dollars.


“The free software movement is composed of people who produce value for free, just because they enjoy creating things and believe that someone *should* create the things they do. The Khan academy provides everyone who wants it and is willing to do the work with a world-class education for free. Wikipedia and online lookups have taken over from pretty much every publisher of encyclopedias and reference materials by providing a crowd-sourced free service.”

Except these things aren’t free either, you note it yourself “willing to do the work,” and there remains competition for value and for worth. 1) You have to pay for computer time, access, et cetera. 2) You have to be able to afford the time itself. 3) There are opportunity costs involved with going to school vs. any thing else you could be doing with your labor. A Khan Academy education (which may be “world-class” I don’t know) is worthless compared to a four-year degree at even a crappy accredited school. Even “I’m a Phoenix” (talk about a crap degree) is worth a LOT compared to “I’m a Khan”, and just try to get a job at DuPont with your world-class Khan chemistry classes on your resume. Should that change, then it will put downward pressure on prices at real schools and prices will come to equilibrium.

But neither Wiki or Khan are not free in other ways as well. SOMEONE has to put time, effort, and resources into creating and maintaining them, and that means labor and money and the costs associated with the other productive uses that such resources could have been put to. Servers, infrastructure, maintenance, physical spaces for machines, cooling, power, content, fact-checking, this list is endless, and Khan and Wiki and similar have all cost enormous amounts of time, effort, and money to exist and keep existing.

The point of all of this is to illustrate the issue: no matter where a money comes from, it is simply a representation of the value of your labor. If, in a society, there is x amount labor that results in y amount money, and you inject some z money, the net result is an equilibrium of y and z money for goods and services, which skews x labor as well.


“The very existence of such people and institutions demonstrates that even given a basic income, there are human beings who won't just sit on their fat asses and produce nothing, because the creative impulse is just too strong. In fact I believe such people are in the majority; working for extra income can be purely voluntary and I think most people would still do it. Maybe ten or twenty hours a week instead of forty or sixty, but more than half of them would still do it, just to avoid boredom, or because they want World of Warcraft access, Television, and more than 400 square feet of living space. And of course there'd still be obsessive types who put in sixty or eighty hour weeks building businesses, because building businesses is what they love to do, what they take pride and identity in. In fact that pretty much describes the current set of small business owners and CEOs in American business.”

No real issues here. But there are reasons why you don’t see a volunteer version of T-Mobile or Motorola, mostly because the labor involved is of orders of magnitude more intensive than sitting at your computer and marshaling others (Wiki) or writing things down (Khan), which almost anyone can do.
 

“The problem up to now is that such people haven't been able to be productive enough to provide a meaningful small income for everyone. But that's changing. Information is replicable essentially for free, and that makes the producers of free software, and the producers of the recorded lectures and interactive software of the Khan academy, and the people producing designs for automatic production shops on Thingiverse, productive enough that these new institutions are now significant contributors to the world economy. Although measuring their contribution baffles economists a little currently because the price point is zero. As automatic production facilities get better, it's not that big a stretch to imagine just downloading patterns for whatever you want to produce locally. Humans can exist in a society where the basics are provided by robotic means and professional production is restricted to luxuries, land, and things not easily autoproduced.”

Except that, of course, nothing noted here is free. And it doesn’t baffle even one economist because the first thing they learn is that everything is scarce, and therefore it is not free. EVER, for the reasons noted above.

They may not always agree on everything, but they certainly agree on that.

[Cryddit]

There are new conditions there haven't been before.  It's never been possible up to now, but we are moving into unknown territory. 

[brush242]

There are new conditions there haven't been before.  It's never been possible up to now, but we are moving into unknown territory.

This certainly isn't true simply because you state it as a conclusion without any reasoning or support whatsoever. It has never been possible up to now, because it isn't possible. There are no new conditions that change the principle that the only thing of value a human has to offer in trade for money (or, in other words, in trade for the labor of others) is their own labor. They have nothing else to offer. Ever.

There are a lot of unknowns, that is true, but certainly not with the principle I just mentioned. What is actually unknown is how long people will cling to beliefs that they cannot support.