fr4nkthetank (OP)
Legendary
 Offline
Activity: 2294
Merit: 1182
Now the money is free, and so the people will be
|
 |
June 23, 2018, 03:14:57 PM |
|
"
Welcome to the future.
We are in the process of implementing technology that permits an output of goods and services that is magnitudes more than previously thought possible. Never in history has the output of goods been so efficient.
I have been replaced by computers. I have no more career. I am useless now. But I am not useless as a human being. I can volunteer, stay healthy, learn new things, become a better person, involve myself in the community and make the world a better place. Try to make my world a better place. Growth, utility and incentive/behavioral based economics have run their course and although their models do permit us to many great things, they fail to capture most externalities. It turns out that these externalities have a much greater impact on our civilization than has been previously accepted.
Remember the only goal of our civilization is survival. Not as individuals, but as a whole. Our institutions are what is truly important, not who you vote for or who is elected. Beware when institutions change, for great turmoil is ahead.
What value does a human being provide to society when that person performs actions that in no way shape or form betters society, or even maintains it ? Negative value. Zero present value and negative opportunity value and negative externalities. Working a minimum wage job that can be replaced by a machine is a net loss for society. The more low paying workers you have spending most of their available time and resources on near useless work, the more society goes into the negative.
As the old saying goes, breaking windows and replacing them is no basis for a sound economy. Well neither is most low paid labor. In current economics we would define the efficiency point of manual labor vs automation by either calculating capital costs/labor/output and expand until the marginal cost approaches marginal return. In layman's terms, that means "don't ask for a pay raise, because I'll have a machine replace you". For the closed employee-employer capital-labor ecosystem that works, but as a society it does not. The opportunity cost of having perfectly worthwhile human beings waste their lives is immense. It is even reflected upon later generations. Negative externalities abound - crime, poverty, school dropouts, weak social participation, weak personal responsibility for immediate surroundings - are all much more present in areas were low paying workers live. This is not a coincidence, nor is it a innate trait. Weak social mobility and the poverty trap are also negative externalities of lost potential.
Basic income. Once you separate "pay" from "work" things become clearer. Your pay is not in relation to your work. It is based on the demand and supply of available trained workers and the demand and supply for the goods and services they produce. Lowly workers do not see this, for they never pocket the surplus but always pocket the shortfalls. When society produces great surplus, only a fraction of it appears at the margin. And the law of decreasing returns also applies here. Taxes are paid on a local level, yet operations are now on a global playing field. In practice, this means the only people that are taxed are those that play in the local playing field. It puts an additional burden on society which reaps yet more negative externalities. Our economic models are flattening out. Growth is flattening and so is production, population and productivity. This is unacceptable. We are not a log based civilization and even linear progress is not acceptable for our long term survival and prosperity. Our survival is at stake here. We all can see what road we are on right now, but only a few dare stick their heads out and look where the road leads.
The path to a reputation based utility system is one that I shall propose. It is already in effect, but is distorted. After all even the White House, the embodiment of the past, celebrates the greatest volunteers and achievers of this world with awards and a meet and greet with the president. Who is respected more, Warren Buffet or Jonas Salk ? What has more value, Goldman Sachs or Public Broadcasting ? I'm sure Mister Rogers would like to have a nice little chat with all of you. We already operate on a reputation based society and now it is time to use this foundation to grow in the 21st century. Ideology must be left behind in order to see reality.
The transition. It will be difficult for many. To be told they are useless. To realize it. To understand it. But they will not dig a hole and wait to perish, nor will they stay home and consume pointless hours of meaningless entertainment or even engulf themselves in the abyss that is alcohol and substance abuse. They will be free, and that will empower them. Freedom to have a future. Freedom to choose and have choices. Freedom to explore themselves as human beings and freedom to contribute to society in a positive way. Free to properly raise their children so that they will become a positive force in the world, not its victims. Free to mold the future, not be shaped by it. Free to stand up and work on something worth doing. Free to think.
Basic income is not expensive. It presents a net gain for society, and so in that sense it is more than free. But in our current framework it is a cost. To spearhead the transition we must stand on the shoulders of giants and march forwards. These giants are our financial institutions and the foundations of our society. Different cultures and societies are free to provide a different form of basic income - in exchange for work, volunteering, military service or schooling. Basic Income needs not be free. Nor is it. But it needs to be universal, like basic rights that are bestowed upon every human being the moment he takes his first breath.
Every human being will be given credit that will permit them to work from a position of relative comfort - where his efforts are not wasted on simple survival, food gathering or finding basic shelter and security. This credit will come from the local and national governments that provide services and taxes its citizens. This situation will put a major strain on the budget and will not be feasible. The government operates in the local level, and so the implementation needs to be supported by the global playing field. A basic income financial institution will be created with token capital from the local institutions. This institution will disburse credit to all that are eligible. The institution will benefit from extremely low capital ratio rules and will have no reserve requirements. Its money - or debt - will be deposited directly in other institutions as per usual. At the end of each cycle, or year, that institution will be deemed bankrupt and will be liquidated. The same day, a new Institution will be formed, with a token capital injection. The direct cost to society will be a sliver of a fraction of the actual money disbursed. The benefits will be local - and global. The costs will be globally shared.
In order to sustain the system, the central banks will have to adjust policy to simulate a yearly significant banking default in the system and will have to compensate. The global field can support a distribution of the costs throughout the system, because the externalities are positive. This provides a net positive gain for society. Inflation and growth will pick up, which is an arguably good thing in this era of near zero inflation and abysmal growth. Remember asset purchases by central banks is a form of basic income for financial institutions. Interests rates will rise, which is also a good thing in this world of a broken interest rate system. At a local level, borrowing profiles of the citizens will improve and loan defaults will go down. People will save more and thus we will have more investment capital. The positive feedback loops from these actions will echo even in the darkest reaches areas of our society, areas our society wishes didn't exist. And with a little bit of luck and hard work, they won't exist much longer.
-The Sisko
"
|
