Jed recently brought up some interesting issues related to how will a modern society manage to "spread-the-wealth" equitably when presumably robots perform most of the labor.
I think the author Jed refers to is probably spot-on when he brings up the rather unsettling prediction that a free market (as it is currently understood and practiced) is likely to cease to function if robotics continue to assume much of the labor. A subtle point, one that I suspect terrifies many individuals, particularly with fiscally conservative perspectives (aka Tea Party movement) is the contentious issue as to: Who will pay for all of the goods and services. Right now it would seem that politically charged rhetoric of this nature is being played out which is mostly spearheaded by conservatives who have done everything within their power to vilify government institutions as being the source of our nation's current economic problems. The government and the institutions it supports are being accused as being fiscally irresponsible. IMHO, much of fear is politically motivated and in many ways being tragically misplaced. I could be wrong on this point, but IMHO, many conservatives have fixated much of their present fear on a staunch belief that in order for the economy to survive we must maintain something akin to what might be called a fixed monetary system. We must spend only what we take in from tax payers. Sounds sensible at first glance. However, IMHO, to believe that there has ever existed a fixed amount of money circulating through the system has not existed for a very long time, especially since we got off the gold standard. There is a related “sister fear” many conservatives adhere to where we don’t want to pump excess "cash" into the economy because of a concern that massive inflation would result as loose dollars pursue too few goods. While a fear of inflation is indeed a legitimate concern, based on past historical accounts, I think much of such hand-wringing completely miss an essential point: The point being that as automation continues to improve and generate more productivity, so will there be an increase in the availability of goods that can be purchased. What this essentially means is that as additional goods are generated along with an increase in the availability of cash there will continue to be a balance established between available goods and available cash. IOW, there will NOT be too few goods chasing too many dollars which causes inflation. As productivity continues to increase, inflation will not likely happen as it has done so in the past. * * * Personally, I would like to see the day come where our current monetary system might be turned upside down in a major fundamental way. While on the surface currency might still be perceived as being used in the same way it always has been used in the past there would be a BIG difference as to where the cash (currency) actually comes from and where it eventually ends up going. For one thing, instead of basing money (or currency) on a fixed amount of "dollars" that are constantly being transferred back and forth between individuals, (similar to how we currently attempt to regulate inventories on all sorts of resources), I would like to see the day come when "cash" or income is generated right at the point where a transaction occurs between two individuals, between the customer and the seller. Let me try to clarify: When a customer purchases any kind of product (physical and/or virtual) from a seller, the seller automatically receives a fixed amount of credits that are automatically deposited into his personal credit bank account. Meanwhile, the customer who purchased the product GENERALLY deducts the same amount of "credits" from his own personal credit bank account. A key point that must be grasped here is the subtle fact that the customer doesn't really GIVE or transfer his credits directly to the seller. Likewise, the seller isn't getting his "credits" directly from the customer. It may look as if the two are actually transferring credits between each other but they are not. The customer is actually transferring his credits to a centralized computerized repository system that is keeping careful track of the distribution of all resources concerning the entire economy. Likewise, the seller automatically receives "credit" from the same computerized repository system for the "sale" of his product to the customer from the same centralized computer repository system. Why would one want manage the transaction of "credits" like this, particularly since it doesn't seem all that different than what we do now? Granted, on the surface it might even seem redundant, full of red tape, essentially counter-productive. Maybe even... communistic!!!! After all, what does this system buy us? IMO, it buys us something essential, something precious, something that is extremely difficult manage under the current monetary system, particularly when the economy begins to suffer the effects of recessions and depressions when cash seizes up. This new approach effectively allows anyone to continue to work and as such to generate much needed income for themselves so that they can in turn purchase products from other workers - which in turn tends to stimulate the economy. For example, this new approach would allow an ailing individual who may not have enough credits in his bank account to "pay" for a chiropractic session. He can still go to a chiropractor anyway and get his back worked on. If the patient can't afford to "pay" the entire "bill" for which the chiropractor typically charges, that's not a problem for the patient because the chiropractor isn't actually getting his payment directly from the patient. The chiropractor is actually getting his payment from the centralized computer system that keeps track of all transactions - both what's coming in and what's going out. It's the centralized computer system that is responsible for generating "cash" on the spot for the chiropractor's services. It's also the centralized computer system that is keeping track of how resources are being transferred between individuals, and who is doing well economically and who is ailing. This approach allows the chiropractor to keep on working to his fullest capacity. It allows him to generate/receive spendable "cash" that helps keep economy stimulated. It also allows the ailing patient/customer to get an essential service he desperately needs and as such heal more quickly so that he too can get back to work sooner, to once again start performing a useful service which in turn will generate additional spendable credits for himself that he can spend to stimulate the economy. The point of this scenario is to make sure that all essential services (all forms of essential EMPLOYMENT) continue to be performed despite the fact that some might not actually have the "credits" in their personal bank accounts to pay for the services in their bank account. Ironically, this IMHO will not cause the nation to go massively into debt, or generate inflation. Far from it. I'm sure such monetary system could be set in place where essential goods, like basic unprepared grocery food, basic shelter, basic health services, basic public transportation, maybe even education (especially technical training etc...) are that rights that everyone is entitled to and guaranteed to get. If they don't have enough credits in their bank account to pay for these rights, that's ok. They will still get access to these services. The computer central system is keeping track of the general health of the economy and who is working and who isn't Keep in mind this is NOT a free for all. You're not getting something from nothing. If anyone wishes to purchase all sorts luxuries that are presumably being manufactured in a humming economy they had better make sure they spend what credits they do have in their bank account wisely because their personal credits must FIRST go to "pay" for all the basic services they are entitled to. There will be few or no freeloaders under this new system. If people don't work, ok, they will still get the basics and they will end up spending all of the personal credits and essentially go into virtual debt. But if they want to purchases all sorts of luxuries, they will have to work more diligently and enthusiastically in order to earn additional "credits". They will have to perform a useful recognized service in order to get additional credits to purchase those luxuries. I really don't believe such a system would be economically detrimental. I also don't believe such a system would generate inflation. Keep in mind the fact that under such a system, nobody can generate "cash" from nothing. "Cash" can only be generated as the result of performing a legitimate service, a transaction, where a transaction transpires between a seller and a customer. Keep in mind that a seller can only work so many hours in a day. It would essentially be impossible to generate unlimited amounts of excess cash forever from doing nothing. Cash is only generated after a service has been recognized and recorded between two parties. A transaction between a seller and purchaser must registered within the centralized computer system that keeps track of these things. Market forces, supply and demand, are still in place. I think many tend to forget something fundamental about the economy, such as the fact that during recessions and depressions we are suddenly faced with a surplus of people who desperately want to work. Ironically there are jobs available, the production of needed products could be performed. But unfortunately because there is no surplus "cash" available to pay the "surplus" work force, they can't perform the much needed work. This is insane! This is not how currency is supposed to work in an economy. It's a negative feed-back-loop that feeds on itself. It tends to bring the entire economy down. It brings everything down because we erroneously believe that cash needs to be maintained and supported as a fixed asset. IMHO, money is not a fixed asset and hasn't been "fixed" for a very long time. However continuing to treat currency as if it's a fixed amount tends to make certain people figure out schemes to get everyone else's credit. Lately some individuals have gotten very good at working out such schemes, much to the determent of everyone else. Could such a brave new system be abused? No doubt I'm sure it could be. However, considering how the current economic system has been abused, which in turn have caused huge amounts of suffering, I'm willing to explore this new system a little bit more. There is much computer modeling that needs to be done to test this revised virtual monetary system. Such a model should be carefully compared to how the current economy model works. For example, what happens to the flow of currency between individuals and corporations buying and selling from each other. Would such a currency still tend to accumulate in large stashes as it currently does, to the determent of others, the have-nots? Is there a way to keep currency flowing more equitably, flowing more freely throughout the economy? Different economic scenarios need to be plugged into the system see which system turns out to be healthier in the longer run. Regards, Steven Vincent Johnson www.OrionWorks.com www.zazzle.com/orionworks
