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Author Topic: Universal Dividend  (Read 18146 times)
Galuel
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August 14, 2010, 07:34:29 PM
 #81

Thank you Galuel!  The contrast you provided allowed for an epiphany.

The funny thing is, the revelation was that the current central banking mandate is the correct one! :-)
At least from my perspective it is. And I feel confident I can coherently explain why. No conspiracies required. Who'd a thunk!

Since my english is not perfect, sometimes I'm not sure to understand subtile sentences like "allowed for an epiphany", if it's a joke or not ?!  Grin

In any case the problem with bank system with a central banks is the fact that money is not symetricly created in space and time, but only towards arbitrary value, decided by centers of decisions, creating bubles AND HOLES (we only speak about bubbles, but where money is not created we have holes).

It's impossible to see stability of money creation in such a system, where lots of values are denied.

Symetric money delegate idea of value to individuals, with a universal way to exchange it.
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Red
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August 14, 2010, 08:26:20 PM
 #82

Agreed, the percentage of *arbitrary* inflation does not matter for this discussion. (Non-arbitrary inflation is discussed at the end.)

Quote from: Red
The rich lost in their personal value as measured in loaves of bread.
The poor won in their personal value as measured in loaves of bread.

Rich is not equal to have money. Rich have can have goods, and not money. It's a choice to keep money and not goods.

If you think bread is a specific value very important to estimate your money create a money backed on bread !

I think any specific value as no universal value but human being. I don't care about bread. And if all people buy bread, I will be able to buy something people don't bye, if all the people sell bread, I'll buy at a better price perhaps, if I decide to.

So looking at inflation looking at any specific value in a very strong mistake undestanding economy as a whole thing.

OK, I said some inflammatory things prior to this section. I guess that justifies the defensiveness of this reply.

Rich in this context meant - Currency rich. i.e. Those who possess their wealth in currency.
Poor in this context meant - Currency poor. i.e. Those who possess their wealth in stuff (Me).

I'm well familiar with wealth that is not currency. Most everyone is. Please interpret all my responses from that point of view.

Bread is an important commodity because it is perishable. I know I'm going to need to buy lots of it next year, but I can't buy it now. It serves as a common archetype for consumption.

It doesn't make sense to "back a currency with bread" in the same way as you could with a non-perishable commodity like gold. But you knew that.

By making specific examples for discussion, I'm not misunderstanding the economy as a whole thing. I'm simply trying to address the economy as a sum of individual commodities and the desires of those who consume them on one fashion or another.

Quote from: Galuel
+ value is not money. Value is all what you own including money which can be a very small part. So speaking about value

Absolutely, that is why the amount of currency available is trivial compared to the amount of commodity value in existence.

Quote from: Galuel
So don't create BitCoins.

The birthcoin example, did not arbitrarily inflate as bitcoin is currently doing. It merely attempted to remove the tyranny of time from the fixed currency model. There is a lot of discussion of what constituted "fair" on this site. Also what constitutes "sound money". The birthcoin example was intended as a "fairer" way to initially distribute coins, without introducing too many variables at once.

I've already addressed elsewhere that the idea of bitcoin trickling money in over time is completely inconsistent with of principles of a fixed quantity of currency. I find it curious that bitcoiners use inflation as an incentive to sell future deflation.

I've also discussed in detail (elsewhere) the fact that I personally feel, building persistent price deflation into a currency is completely counter-productive.

Quote from: Galuel
Quote from: Red
This is an argument in favor of "price inflation". Since it makes rich people's currency worth less, they will spend it on things that either 1) generate additional currency to make up for the loss or 2) commodities that increase in value as measured by the currency.

Yes, they'll do what they think it's good, what they think "this is value and this is not" and when selling it perhaps the market will say "ok you took a risk, but this is something I don't want to pay what you expect.

In reality, I think (when averaged over a whole economy) generalized price deflation is "a bad thing". I also think generalized price inflation is bad as well. However, the balance point is NOT at zero. A little deflation is a lot worse than, a little inflation is. That point is supported elsewhere on this site. Therefore, defending against generalized deflation is a priority, and if that cost a little inflation, overall its a general win.

But to be clear, adding more inflation when you are not in danger of deflation, is "a bad thing" from my point of view. I am not "a progressive" in this regard.

Quote from: Galuel
- Growing (but slow growing) dividend is the only fixed common value we could all be sure, anything else depending of the sum of global work each one will done. It's difficult to generate confidence in a system where ALL the things can change at any moment because of births and deads etc... At least, a little amount of money is sure.

Fair enough. No one could think of a better number to quantify growth.

Quote from: Galuel
Quote from: Red
I don't understand this. Can you restate it?

In an innovative economy if money is not dense and stable in space and time confidence cannot developp for investment. In a local part of economy, because of lack of money, investment stop, people try to developp another money system. Not because they don't produce, not because they are "poor", because money is not present, because it has been created only on the past and stocked in another local economy, or it's been created in others parts of the space.

Because money is not universal.

A minimum "flux" of money is necessary if the goal is allowing universality of exchanges elsewhere. Money is not value. It's a tool to exchange it.

Thank you for the restatement. We are in complete agreement.

Quote from: Red
IF I increase my own personal productivity and/or the productivity at of others, while at the same time bringing society as a whole additional aggregate and individual value as a direct result of my increased production,...

THEN, there exists NO MORAL REASON for you to take ANY of the value I gained as a result of my productivity invention. In European terms, I would say I have "moral rights" to my creations and to profit from them. Exactly the same moral rights as if I had written a book, or made a sculpture.

You didn't accept or reject this statement. Is that an oversight?

Quote from: Galuel
You don't think about collective goods, which value depends not of selling it, but to the fact that a lot of people can use it. So those goods inflate rapidly, and give collective value to society (so it's also during time evolution of language, mathematics, science, as collective goods).

This is what you do with all open source systems developped to run internet, and to developp digital economy. You profit for it, and the developpers have received nothing, because they expect a return they don't see.

You should discuss with open source and open content producers about that point.

I do write open source software. I have considered everything above. It has no effect on the point I made.

I can write a book or a post and give it away. That doesn't mean I have received no benefit. My perception of the benefits for doing so is up to me not to you or society at large. That is why I only respond to certain posts. Some are not worth my time.

But if I have freely given away an insight to you that you use to benefit you and the others around you...
Then let me stipulate for the record, "You owe me nothing! Ever! Not even if you get rich in supermodels!" I've already taken my personal benefits thank you. While I speak for myself here, I'll make the stronger point that this hold true for everyone.

The same moral rights I assert that protect me from your taking my benefits, also protects your productivity increase share. This hold true if you bought my ideas, or I gave them to you for free.

Quote from: Galuel
What you think about money (not inflate it !), they do it with goods (digital value inflate) without a minimum money compensation in the system we live.

I wish to understand this statement but I don't. Can you restate it, please?

Are you saying, how can open source writers continue to write open source software if they can't figure out how to support themselves? If they can't figure out how to support themselves, that doesn't make their problem into my problem. Nor does that make it OUR problem. Why on earth would you think it should?

Quote from: Galuel
Goods inflate, and money should not ? We have a problem of logic here.

Stipulated for the record. I think that currency levels should increase decrease as necessary so that (on average over the whole economy) prices remain constant. Where the most important prices to remain constant are the prices of the things that most people need to preserve their life and livelihood.

As non-inclusive examples of the category: Food, electricity, water, fuel, internet access!
Commodities that could inflate or deflate relative to the above without me caring: Gold, luxury goods, recreational drugs

The reason my example included a deflationary economy was purely so its differences could be compared relative to bitcoin.
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August 14, 2010, 08:40:29 PM
 #83

Since my english is not perfect, sometimes I'm not sure to understand subtile sentences like "allowed for an epiphany", if it's a joke or not ?!  Grin

Your English is much better than my French!

No it was not a joke. It was sincere thanks. Thank you again!

The reason I wrote it that was is because early in the thread I saw value in contrasting your ideas with the more common ideas held by people posting on this site. I though the contrast would help bring their ideas into focus. Instead it focused my own. :-)

I'll write about my insights later.

In any case the problem with bank system with a central banks is the fact that money is not symetricly created in space and time, but only towards arbitrary value, decided by centers of decisions, creating bubles AND HOLES (we only speak about bubbles, but where money is not created we have holes).

It's impossible to see stability of money creation in such a system, where lots of values are denied.

Yes, that is the way current money creation is perceived.

I'll argue later that money creation should not be symmetrical in time or space. I'll also argue that money bubbles and holes cannot be prevented using fixed preset formulas. As such, money *creation* should not be seen at stable, but money itself should.

Symetric money delegate idea of value to individuals, with a universal way to exchange it.

I'll argue symmetric redistribution is simply a social policy tool. It should be kept separate from monetary policy.

One equation can't serve two masters. :-)
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August 14, 2010, 09:59:32 PM
 #84

Quote from: Red
But to be clear, adding more inflation when you are not in danger of deflation, is "a bad thing" from my point of view. I am not "a progressive" in this regard.

Doing that you decide specific values for which you estimate price, and you deny fair money creation for the next generation compare to yours. Next generation who want to buy, invest, sell completely different things you cannot even imagine.

They say to you : "We don't matter price, we just want as relative money created as you during our whole life, so don't steal money creation for your own profit. You have been able to have what you have because of cooperation of your generation within a money system in which you created money, so we want the same. If you don't agree, then we'll build another money system, and we don't want your 'not fair' money".


Quote from: Red
IF I increase my own personal productivity and/or the productivity at of others, while at the same time bringing society as a whole additional aggregate and individual value as a direct result of my increased production...

THEN, there exists NO MORAL REASON for you to take ANY of the value I gained as a result of my productivity invention. In European terms, I would say I have "moral rights" to my creations and to profit from them. Exactly the same moral rights as if I had written a book, or made a sculpture.

Quote from: Red
You didn't accept or reject this statement. Is that an oversight?

The fact is since my english is far from perfect, I didn't understood this completely...  Wink

I cannot think in the individual part only. And in monetary part only too. I think individual and society as well, and money and goods.

There is no ethic reason to steal your work, and you have moral right to profit for them. But also when you benefit from others works given to you, you have moral compensation to accept some money is dedicated to retribute collective adding value, which cannot be valuated by direct monetary exchanges (case of free software).

It's the two parts of Local / Global

I think it's not moral to use those kind of global value, and not accept a global money compensation for it.

So the exact mirror of : you have moral right to profit from your creation (from a money compensation point of view) is : // you have moral obligation of NOT using global value if you don't accept global money compensation for it.

Quote from: Red
I do write open source software. I have considered everything above. It has no effect on the point I made.

I assure you Universal Dividend develop interest in this population, in France one of the most famous site for Open Source, FramaSoft, published this article.

Quote from: Red
I can write a book or a post and give it away... etc...

I fully understand this point of view, but in my opinion it's not efficient.

We cannot think a money system from a specific point of view. We may think about the people at present and future time, in a fair way. Our value are not theirs, but we try to build an universal tool for exchanging it between them thru space and time.

Money is a collective way to exchange goods, it cannot be created for some people and not for the others, by deciding this from a specific point of view.


Quote from: Galuel
What you think about money (not inflate it !), they do it with goods (digital value inflate) without a minimum money compensation in the system we live.

Quote from: Red
I wish to understand this statement but I don't. Can you restate it, please?

Money is the mirror of a certain part of goods (lot of goods are also directly exchanged without money compensation). The quality, or quantity, or innovation of goods, globally need more money tomorow to developp. If not, there is no adequation between expected money, and work.

The creative and continue process of money creation IS the fundamental incitation of growth (inflation of goods).

It's BECAUSE this process is cahotic and not based on a regular basis, that fear appears about what people can expect tomorow, crises, bubbles and holes.

Long term economic investment need a long term fair money system. When the money system is something which says "tomorrow we will have -1% of money, and next week +10%, and in 5 years we don't know because our money system is totally instable by contruction", that IS the cause of crisis, bubble, holes, and lose of confidence nothing else.


Quote from: Red
Are you saying, how can open source writers continue to write open source software if they can't figure out how to support themselves? If they can't figure out how to support themselves, that doesn't make their problem into my problem. Nor does that make it OUR problem. Why on earth would you think it should ?

Because of lack of money compensation, they will build their own money system. For sure.

If the old money system propose a change to monetise the part of global value all people work for (not only Open Source, Mothers for their children and lot of other big work...), then the need of an other money system will disappear.

If lots of money systems developp is because the lack of money due to a non-fair non-symetric non-timespace-dense and old money system.

Quote from: Red
Stipulated for the record. I think that currency levels should increase decrease as necessary so that (on average over the whole economy) prices remain constant. Where the most important prices to remain constant are the prices of the things that most people need to preserve their life and livelihood.

I don't agree at all. I don't know what is "prices". I only know how much money there is, how it is created in space and time. Any other things concern individual choices.

Quote from: Red
As non-inclusive examples of the category: Food, electricity, water, fuel, internet access!
Commodities that could inflate or deflate relative to the above without me caring: Gold, luxury goods, recreational drugs

I don't want any specific values I DONT CARE AT ALL, be a part of a money creation system.

in fact quite all those things were not "essential" 100 years ago, and none will be existing in 300 years. And I'm totally sure than an ascete don't care about all what you could define, but he give something we can't imagine to those he teaches. Every human being is a universe of full value, nobody has the right to deny.

By defining "essential values" in fact you deny "other's essential values", like gold was in past. Exactly the same. All this are very big mistakes towards intense creativity of individuals, able to develop an entire personal universe of life.

I don't want any human being define what is value and what it is not, what is essential and what it is not, what is high price and what is low price.

I don't want a money created on any other base than human being as ONLY fundamental and universal part of ANY economy of past, present and future, until we meet other intelligence able to trade with us.

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August 14, 2010, 10:02:49 PM
 #85

Interesting topic and debate. Here are my thoughts, layman that I be.

The act of creating currency does not create wealth. The new unit of currency is produced from “nothing”. Since it is not possible to create something from nothing, the 5% new currency which has been created becomes an informal 5% tax on everyone who uses that particular monetary system.
 
Creating money so that people who don’t have any can have some just because they exist is an interesting social idea, but it does only harm to the currency itself.
Helping people to produce a substantive item (by skill, craft, blackmail, whichever tickles you best) and to earn currency is the only way to empower them and retain the value of the promise to goods (currency) which they have worked for. If you wish to help those who have nothing, why place this burden on the currency? Rather levy a real tax by means of legislation to do so, and keep the purpose of the currency pure.

This, in my opinion, is the greatest power of the bitcoin system. Once the creation period is complete, it will be the purest currency the world has seen since the days of the barter system where goods themselves were the currency. With the current corrupt systems of currency, it only takes one dictator to wipe out lifetimes of production earned; Zimbabwe being the most extreme example of this.

There seems to be much debate on the creation of bitcoins. Having read the forums, documents, wiki and most important, the white paper, I think everyone should understand the creation of the bitcoins is a finite process with a specific purpose to the way it is done.  That purpose is twofold. First, and most important, is to create a proof of work which will secure your bitcoin in future. Second is to introduce them in a way which will mirror the acceptance of bitcoins as a tradable item. The creation period does reward those who produce the chain of proof, so in a way the network is being “taxed” by act of creation to pay these nodes. This reward system will eventually be replaced by transaction fees and the tax will disappear in favour of directly rewarding those nodes which do work for the system. Only when the system reaches this point, will the bitcoin have a true and pure value associated to it.

The need to increase money supply, be it in the form of “Universal Dividend” or otherwise is an artificial need, and as I have said, a hidden tax. The only need in terms of currency supply would be that enough “paper” exists to write your promise on. The bitcoin structure provides enough “paper” for the foreseeable future and its value will be firmly set in what you can exchange it for. Why complicate a currency any further?

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August 14, 2010, 10:28:19 PM
 #86

Willsway, if future inflation is stealing from past participation, then isn't it fair to say that past inflation is stealing from future participation? The current inflation rate is EXTREMELY HIGH. Do the means justify the ends? It's EXTREMELY beneficial to the past participants if it is adopted by the later participants. But why should the future participants accept to have had the high inflation stolen from them simply because they didn't know about the project or were not born yet? Isn't it in their advantage to group together and start the whole process over again so that they can also have the opportunity to steal from future participation?

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August 14, 2010, 10:43:48 PM
 #87

Willsway, if future inflation is stealing from past participation, then isn't it fair to say that past inflation is stealing from future participation? The current inflation rate is EXTREMELY HIGH. Do the means justify the ends? It's EXTREMELY beneficial to the past participants if it is adopted by the later participants. But why should the future participants accept to have had the high inflation stolen from them simply because they didn't know about the project or were not born yet? Isn't it in their advantage to group together and start the whole process over again so that they can also have the opportunity to steal from future participation?

I completely agree with that point.

That's why we'll make a fork.

As it is designed in fact BitCoin is a mutual credit limited, which concern only first users, and has no interest for other ones, but the ones who want to work for them.

Only universal credit thru space AND time is fair. Ignoring future is the biggest mistake all conservative thought has made starting that beleiving gold is other thing than a metal, and thinking money should not benefit to all the people and represent value if it's limited.

If limited money is a value, so keep at zero money, you have infinite value.
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August 14, 2010, 10:56:55 PM
 #88

Willsway, if future inflation is stealing from past participation, then isn't it fair to say that past inflation is stealing from future participation? The current inflation rate is EXTREMELY HIGH. Do the means justify the ends? It's EXTREMELY beneficial to the past participants if it is adopted by the later participants. But why should the future participants accept to have had the high inflation stolen from them simply because they didn't know about the project or were not born yet? Isn't it in their advantage to group together and start the whole process over again so that they can also have the opportunity to steal from future participation?

Look, if you tell people that you are going to be debasing the currency and that they can use it or not then that isn't stealing. So it's wrong to call the method in the OP stealing.

But I don't want to invest into a system where my contribution is able to be watered down and given to everyone every year forever. It's also my guess that other producers won't want to get involved either.

The people at the beginning are taking a risk, and they are the only reason the currency will have any value at all in the future. If people want to get involved by supplying more backing in exchange for an agreed upon amount of coin then they can, if not then they won't. It's my guess that they will, that's why I'm earning bitcoin by processing transactions and by supplying goods and cash. There is no guarantee that I am right and my various investments will pay. I am pretty confident judging my the growth of the community over the last month. There are people who were confident even earlier when it appeared even crazier and riskier, they will get paid more for the same investment.

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August 14, 2010, 11:25:21 PM
 #89

tl;dr: What is the best way to tie one person to one identity in a global decentralized system such that on average over consecutive daily, weekly or monthly intervals, each identity only represents one willing and real participant in the system? More participation, less difficulty and less cost are the kind of measurements which determine how good one method is over another.

Edit: This question is important to me and I want wider feedback, so I reposted the question in the general forum.

Galuel, I had never heard the word cooptation before and because of your non-native English, at first thought it was a misspelling of cooperation. You were correct in how you used it and I don't know how widely the word is understood by native English speakers, but if Red's and my understanding is representative of average native English speakers, then for future reference, you should define it before using it, or use a similar more widely understood word. For everyone else's sake, cooptation (alternately spelled co-optation) (to co-opt as a verb) as used in this thread, means assimilation, naturalization or initiation. And cooption is a cooptation, which I assume is an instance of cooptation. The definition was taken from Wiktionary and like I said, I can not recall ever having encountered the word before this thread.

I am quite interested thinking about how cooptation (hehe, I'm using a new word Cheesy) can be most effectively performed within the constraints of a decentralized global organization. In a centralized system, you can simply gauge simple participation which is difficult to scale and then continually check for cheating. This is essentially what many closed websites do. They're not closed in the sense that they're trying to keep everyone out, it's just that they're trying to tie one person to one account to promote and maintain a positive cultural environment.

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August 14, 2010, 11:28:23 PM
 #90

Willsway, if future inflation is stealing from past participation, then isn't it fair to say that past inflation is stealing from future participation? The current inflation rate is EXTREMELY HIGH. Do the means justify the ends? It's EXTREMELY beneficial to the past participants if it is adopted by the later participants. But why should the future participants accept to have had the high inflation stolen from them simply because they didn't know about the project or were not born yet? Isn't it in their advantage to group together and start the whole process over again so that they can also have the opportunity to steal from future participation?


I admit the current system of distributing coins probably isn’t ideal but it would take a great deal of statistical analysis I’m not enamoured to do to prove that… but the word “stealing” would only be valid if you propose the act of creating the network is not work of production for which money is earned and the rest of the network is taxed for to pay.

Current nodes produce at risk, since there is a very real risk they may not realise the value of their production thanks to many factors (such as bitcoin ultimately failing) which I will not mention in detail.

Current nodes should be seen as miners who are mining a finite resource at risk. They then take the product to market and trade it for something they can use. If they wish to add to the risk by hoarding bitcoins in anticipation of future riches, how is this different from purchasing shares in a high risk company? If the company does succeed, the rewards will be high, as the share price spikes. People who then notice the share and offer to purchase it, at lower risk, do not complain that those who purchased the original share did so at 1/1000 of the price. Why? Because the share has value and they are after the value they can realise. They do not care to take the risk the early adopters did.

Ultimately the bitcoin value will stem from demand + usability vs supply. Since future participants will never be aware that once one could “mine” for coins and since mining for coins is not the objective of the currency but essential work to secure it, why would they feel hard done by? And should they find out, why would they care? The mine is empty and they still have a useful means to purchase products and services. If one of the early adopters then chooses to flood the market they will devalue their own wealth and the effect will be short lived (as debated in many forum topics).
 
So the question is, why would future participants care about past inflation if the value they currently place on the currency acquires them that which is equal to the production they produce? They would only be concerned if their currency became meaningless and stole from their day to day production.

Should these future bitcoiners decide to create their own currency, face all the risk of creating their own mine, put the effort in to make it succeed and generate value and if the succeed become rich in the process, good on them. Competition is never a bad thing.

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August 14, 2010, 11:43:23 PM
 #91

FreeMoney, your contribution is being watered down every ten minutes, and at a rate much much higher than 5%. The point is that the creation of the money has to happen at some point, so why distribute a MASSIVE amount up front and then ZERO later? Well, the incentive is clear, the early adopters want to force their advantage on later adopters. But it's voluntary, so later adopters have no incentive to accept such blatant inequality. The sum of future participants is much greater than past participants. Future participants will contribute much more to society than you ever will, so why should they be shafted? The goal is not to devalue your money. Since the money has to be created at some point in time, the rate of creation might as well be equal over time to give all participants an equal opportunity. Despite what you think, your efforts are not inherently more valuable than future generations and future generations will not accept the inequality of the past. You can either force the masses to adopt Bitcoin after you have obtained your wealth or you can wait and watch for it to fail once the next generation starts to take over.

Willsway, the project is open source. The future generation can join together to create an improved currency with very little effort. Identical goods and services offered by future participants are just as valuable as identical goods and services offered by current participants.

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August 15, 2010, 12:31:23 AM
 #92

@ Galuel

I thought we were reaching some common understanding with a few quantifiable places where we disagree. But now it is seeming less so. I need to validate my understanding of your positions before I feel comfortable proceeding.

-----

It now seems this universal dividend concept is just a proposed solution to "the bootstrap problem".

Meaning, we want a new currency to exist, but it can't exist until we distribute some amount of it.
If we create and distribute this amount of currency out of thin air now, "to be fair" to people who come later, we must continue to create X() amount of currency from thin air forever.

Is that the only problem you are trying to solve?

Or are you saying, the EU should be paying a universal dividend every year, because they created a new Euros out of thin air and "to be fair" they should/must continue to do so?

-----

It also seems you are trying to recreate the Christian notion of "original sin" in your economic system.

Meaning, you were born into this world/culture. As such, you owe us for all the nice things we have provided for you. This is a debt you can never repay. No matter how much you donate, we will always say that there are other intangible things to which you continue to benefit, therefore you continue to owe us. And if that seems unreasonable, think of future generations, you owe us because of your debt to the future.

Is that your philosophy? Is there ever an amount of money or commodity I could give to "society" where they would say "Thanks! you don't owe us anything now. Everything you earn now is guilt free!"

-----

When you speak of work that benefits society but is otherwise not directly uncompensated you seem to know its value in total (5%/yr), but deny that anyone can fairly put a value on any of the composite parts.

For example, say I enjoy writing Vogon poetry. There is no current market for Vogon poetry because everyone knows that reading Vogon poetry akin to torture. But that doesn't matter. I'm contributing to society anyway by writing Vogon poetry. You can make no judgement as to what value future generations might place on reading Vogon poetry. Who knows? After all who could have predicted people gullible enough to listen to trance music.

But you decide I'm entitle to payment now, on speculation that it might benefit society in the future. Is this your logic for everyone receiving a share of new money?

-----

Anyone feel free to tell me I'm totally misunderstanding these ideas. I'm not trying to be sarcastic. This is the way it is seeming to me.

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August 15, 2010, 12:49:33 AM
 #93

Willsway, the project is open source. The future generation can join together to create an improved currency with very little effort. Identical goods and services offered by future participants are just as valuable as identical goods and services offered by current participants.

Agreed, they will have past experience to their advantage. However the work done which I mention has little to do with the code (urm, dear developers, I know you slog away at the keyboards like caffeine slaves, no disrespect implied). The real work, in terms of the currency, is creating a secure proof of work to prevent things like forgery, etc., which users currently perform with their cpu's. The other part of the work is convincing other people of the value of the work done (in this case the bitcoin) by offering them something they can exchange for a coin. The relatively small and few non-exchange items on the trade page is proof of how difficult it is to create value. The new currency would have to reproduce all of that work. To tell the truth I am surprised the Bitcoin has achieved it's current value against the US $ and feel it is rather inflated thanks to fundamentalist followers who want the concept to work rather than a true value pegged to production. The question is, will the future project have this advantage? If the motivation of the future generation is to create coins to enrich themselves rather than to create a "pure" means of exchange, would that greed not tempt them into corruption and thus reveal the true intent in the modifications? If the new system was based on a fundamental objection to a current one, as bitcoin is, they could have the same advantage and if so, good on them for then putting in the work to create value and a better world.

I think where we differ ideologically is that I believe money should be pure and untainted by direct human intervention. I find the current need to generate coins an unfortunate necessity because it distracts from creating any real value. In a perfect world, money should not be "created" - ever. Production should. Yes, there should be enough money (or as I say, paper) in circulation so that all who choose to use it can deliver a promise of value to someone they purchase from. To create a constant amount of money (5% a year) to infinity which is in no way tagged to production places an unnecessary burden on the currency, forcing it to play a role which is beyond its scope, and opening it up to abuse by the powerful. I have a problem with the idea that creating the paper (bitcoin or another currency) should be profitable. Since the perfect world does not exist and one cannot create "paper" from nothing the miners are important. This is why I say the current generators of the paper we need to use should be seen as miners selling effort for value.

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August 15, 2010, 12:58:17 AM
 #94

The relatively small and few non-exchange items on the trade page is proof of how difficult it is to create value. The new currency would have to reproduce all of that work. To tell the truth I am surprised the Bitcoin has achieved it's current value against the US $ and feel it is rather inflated thanks to fundamentalist followers who want the concept to work rather than a true value pegged to production.

I'm sure you are right to some extent, but don't forget about supply and future expectations of supply. There are about 3.5M available bitcoins. I don't know how many USD there are but it's more than a few orders of magnitude more. There is way way way more demand for $$ than BTC, but there is way more supply too is all I'm saying.

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August 15, 2010, 01:35:55 AM
 #95

What will your majority do to someone who refuses to participate in your system?Forgive me for saying this but I get skittish whenever I hear "social good".Or "its for the children","we know best".Any sort of system that is set up as majority morality will inevitably destroy individuality.
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August 15, 2010, 01:43:02 AM
 #96

The relatively small and few non-exchange items on the trade page is proof of how difficult it is to create value. The new currency would have to reproduce all of that work. To tell the truth I am surprised the Bitcoin has achieved it's current value against the US $ and feel it is rather inflated thanks to fundamentalist followers who want the concept to work rather than a true value pegged to production.

I'm sure you are right to some extent, but don't forget about supply and future expectations of supply. There are about 3.5M available bitcoins. I don't know how many USD there are but it's more than a few orders of magnitude more. There is way way way more demand for $$ than BTC, but there is way more supply too is all I'm saying.

hehe, you're right, I shamelessly ignored the speculators didn't I Smiley

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August 15, 2010, 01:46:44 AM
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The fact that there will be only 21 million bitcoins forever and the fact of inflation is factored into the price. Bitcoins is very predictable and people can plan their economic calculation around that.

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August 15, 2010, 01:51:44 AM
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Red, I just happened to find the correct Wikipedia articles in English. Universal Dividend can also be translated as Citizen's Dividend and it's only one part of the solution. There is also Universal Allocation from the French, which is called Basic Income in English on Wikipedia.

According to the English Wikipedia stub, Citizen's Dividend (Universal Dividend) is just the state paying a dividend on state owned assets like Alaska does. But all the principles are quite inter-related, so here's my understanding of how the currency creation principle works. The basic idea is that the percentage of income created over an average person's lifetime should be as equal as possible from generation to generation. The percentage of increase could be any amount so long as it is constant. But as long as you are increasing income, you might as well do it at the most effective rate to promote healthy economic growth. The problem with no creation is that the currency tends to migrate to certain communities, which isn't bad in and of itself except that it leaves insufficient funds in other geographic communities for healthy economic activity.

Running businesses requires steady supplies of money and products, if you have too much or too little of either, economies can grind to a halt. This can be demonstrated by natural disasters like the earthquake in Haiti along with the corresponding relief effort. Yes, people need immediate help, but sudden instability of products and money causes the whole economy to fail. So although there is rice on the boat, money in the hands of the biggest suppliers and lots of labor is available, the amount of rice is varying so much that its price is spiking up and down making the supplier's job difficult, but he can at least take out a loan to survive the turbulence but the retailers are running out of money without the ability to take out a loan, so they can't afford to make the trip to check whether the supplier has rice available and the laborers have spent all their money on over priced rice which is no longer available. So everyone just does their best to survive until the economic wheels start moving again.

The five percent inflation is simply the best percentage rate to grease the economic wheels, but there's nothing magic about it being five percent. If you were an expert in the relation of currency expansion to healthy economic activity, you could just as readily suggest 3.5% or 7.5%, but it's not fair to have the average inflation rate be 7.5% while you are acquiring wealth and 3.5% after you've acquired your wealth.

Now to complicate things further, Basic Income (Universal Allocation) states that the current western monetary work ethic is a fairly recent human invention which developed during the industrial revolution. The idea is that this idea of individuals working to obtain as much monetary wealth is unnatural and unhealthy. The natural order is to have an extended family unit, where everyone is contributing fairly equally according to the needs of the family and everyone in the family receives the basic necessities of life (not to mention healthy social interaction). Basic Income suggests that because mankind now has enough basic necessities to go around, every individual should get an allowance to cover the basic necessities of life regardless of their monetary economic activity and that the result will be that everyone will be useful members of society. Some members of the family will work to obtain extra monetary wealth so that the family can maintain and improve the family's quality of life and other members of the family do domestic work so that the children will grow up to be contributing members of society instead of going postal at school or at work.

The five percent inflation does affect the wealthy, but not really. Chances are that if they obtained enough money to be wealthy and if the economy is working properly, they'll most likely continue to earn more than 5% percent of their acquired wealth per year. Whereas if the economy was unhealthy, they would more than likely make less than in a healthy economy. Yeah, they're losing wealth, but at the same rate as everyone else and since they're already good at obtaining wealth, they'll no doubt obtain a larger portion of the created wealth, which means more proportionate money in their pockets.

Basic income, on the other hand, would no doubt affect their mass of wealth noticeably. But the argument goes, that if the whole of mankind in more healthy, then then not only will the poor be better off, but the rich will also be substantially better off even though they might sit and pout that a mother can sit at home with her kids and do absolutely nothing but watch TV and drink beer all day while he's been working his ass off all day so that he can have a fancy car and a big empty house.

Edit: I made a few minor wording corrections.

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August 15, 2010, 02:08:01 AM
 #99

Red, I just happened to find the correct Wikipedia articles in English. Universal Dividend can also be translated as Citizen's Dividend and it's only one part of the solution. There is also Universal Allocation from the French, which is called Basic Income in English on Wikipedia.

According to the English Wikipedia stub, Citizen's Dividend (Universal Dividend) is just the state paying a dividend on state owned assets like Alaska does. But all the principles are quite inter-related, so here's my understanding of how the currency creation principle works. The basic idea is that the percentage of income created over an average person's lifetime should be as equal as possible from generation to generation. The percentage of increase could be any amount so long as it is constant. But as long as you are increasing income, you might as well do it at the most effective rate to promote healthy economic growth. The problem with no creation is that the currency tends to migrate to certain communities, which isn't bad in and of itself except that it leaves insufficient funds in other geographic communities for healthy economic activity.

Running businesses requires steady supplies of money and products, if you have too much or too little of either, economies can grind to a halt. This can be demonstrated by natural disasters like the earthquake in Haiti along with the corresponding relief effort. Yes, people need immediate help, but sudden instability of products and money causes the whole economy to fail. So although there is rice on the boat, money in the hands of the biggest suppliers and lots of labor is available, the amount of rice is varying so much that its price is spiking up and down making the supplier's job difficult, but he can at least take out a loan to survive the turbulence but the retailers are running out of money without the ability to take out a loan, so they can't afford to make the trip to check whether the supplier has rice available and the laborers have spent all their money on over priced rice which is no longer available. So everyone just does their best to survive until the economic wheels start moving again.

The five percent inflation is simply the best percentage rate to grease the economic wheels, but there's nothing magic about it being five percent. If you were an expert in the relation of currency expansion to healthy economic activity, you could just as readily suggest 3.5% or 7.5%, but it's not fair to have the average inflation rate be 7.5% while you are acquiring wealth and 3.5% after you've acquired your wealth.

Now to complicate things further, Basic Income (Universal Allocation) states that the current western monetary work ethic is a fairly recent human invention which developed during the industrial revolution. The idea is that this idea of individuals working to obtain as much monetary wealth is unnatural and unhealthy. The natural order is to have an extended family unit, where everyone is contributing fairly equally according to the needs of the family and everyone in the family receives the basic necessities of life (not to mention healthy social interaction). Basic Income suggests that because mankind now has enough basic necessities to go around, every individual should get an allowance to cover the basic necessities of life regardless of their monetary economic activity and that the result will be that everyone will be useful members of society. Some members of the family will work to obtain extra monetary wealth so that the family can maintain and improve the family's quality of life and other members of the family do domestic work so that the children will grow up to be contributing members of society instead of going postal at school or at work.

The five percent inflation does affect the wealthy, but not really. Chances are that if they obtained enough money to be wealthy and if the economy is working properly, they'll most likely continue to earn more than 5% percent of their acquired wealth per year. Whereas if the economy was unhealthy, they would more than likely make less than in a healthy economy. Yeah, they're losing wealth, but at the same rate as everyone else and since they're already good at obtaining wealth, they'll no doubt obtain a larger portion of the created wealth, which means more proportionate money in their pockets.

Basic income, on the other hand, would no doubt affect their mass of wealth noticeably. But the argument goes, that if the whole of mankind in more healthy, then then not only will the poor be better off, but the rich will also be substantially better off even though they might sit and pout that a mother can sit at home with her kids and do absolutely nothing but watch TV and drink beer all day while he's been working his ass off all day so that he can have a fancy car and a big empty house.

Edit: I made a few minor wording corrections.

Thanks for the explanation in English. Smiley

The main problem is how to verify users of an inherently anonymous commodity.Gold cant tell if you have mined other gold for instance.This probably ties into the need for a verification process that doesn't verify you to a central agency such as the state.I see no problem with Galuel creating a separate bitcoin project to create a competing commodity my problem is if the existing bitcoin users are forced to use it.The more implementations of bitcoin like currencies the less likely the current monopoly central banks can shut it down.May the best system win and there is nothing stopping everyone who uses bitcoins from using socialistcoins lol.Whether you could exchange them between each other is the main benefit.

If the socialistcoin project has the same fundamental security as bitcoin then people might use it.If it leads to getting us off the destructive central bank method i am all for it.
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August 15, 2010, 02:15:43 AM
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Thank you very much NewLibertyStandard!

I'm moving to France! I've got to try for some cooptation!
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