The biggest problem in this world is the lack of responsibility. It creates powerlessness. The vast majority of people look to someone else to provide them with a job. Upon this formulae our social problems fester and grow. These people whom we look to for work and guidance - they are looking out for themselves. The ironic twist to this is the selfishness of the few and the powerlessness of the many was taught us a being a good thing. At least from 1776 we have been told that if a few rapacious persons are allowed to accumulate as much wealth as they are able this unfettered greed will force them to perform as if they were responsible people and this process will ultimately produce the best of all possible worlds. 

The idea was plausible when presented by Adam Smith in 1776 but this is 2009. We are talking 233 years of market mayhem, bubbles , depressions, robber barons, pollution, corruption, fraud and consumerism. The market is not as powerful as Adam Smith thought. It does not have the means of controlling people willing to do anything to turn a profit. Think about it. We are sentient beings and we are relying on an invisible hand. Where is the responsibility or accountability in that? 

Adam Smith did not realize the consequence of allowing the Free Market to operate utilizing money. He thought that a person who wanted money would have to serve the interests of those with money. But he equated those with money with the common man, the consumer. He believed the consumer would be king. Which he may be if you equate the consumer with the person who has money. But who has the money? Who buys the scientific research and pays for the publication of scientific opinion? Who pays for the election campaigns of our politicians? Who actually pays the wages of CEOs who run the largest corporations? What is your budget for influencing what these people provide?

The man in the street may determine which breakfast cereal sells but this is of little consequence if she is only given the choices provided by a single corporation. We have only the choices available to us at the local supermarket and this is largely determined by which company has purchased shelf space.

Even if collectively the middle class pays the most taxes, our very numbers make us invisible individually. The large corporation can get the ear of a politician because it is one voice that speaks for millions of dollars. Our voice represents a few thousand dollars in tax payments.

You may have noticed few ex politicians work beside you. They use their political office to leverage fancy public relations positions out of law and insurance firms. While in office who can they afford to disappoint, you or their future boss and clients?

Capitalism did not succeed because it is efficient except at motivating greed and rewarding it. If you have a 'winner take all' mentality then Capitalism will still seem to be the best possible system. But if you believe unfettered greed will produce the best possible world you are wrong. Capitalism says that if someone sacrifices immediate gratification and assumes the risk of saving capital and invests this in a business the person is entitled to reap the rewards. A lot is assumed in this. There is the assumption that the wealth is earned and saved not embezzled or stolen. It assumes that the risk is all one persons and not the communities or the workers. It also assumes that the business is an actual business that buys material and adds value to it. But none of these assumptions necessarily hold true. Companies often buy out the competition and sell nothing but a dream that never materializes. Businesses make profits by consuming what they do not pay for and which must be paid for by others. The Capitalist paradigm contained inherent errors and was doomed to fail us from the outset.

The system, which I shall unfold here, in brief is a highly structured and efficient system, but the key to its success is the ease with which it can be set up and operated. It can be set up anywhere by anyone. It does not require skill, money or experience. It is based on friends helping friends. What everyone does the world over on an informal basis is modified to become a formal economic system.

This short introduction is no more the complete story of the system than a book on capitalism will have every aspect of capitalism spelled out in full detail.

The system is fractal in that the basic unit has the same structure as the system applied world-wide. The starting point or building block of the system is called a civic. A Civic is a group of five to twelve families. A civic is a basic economy and small community. A basic economy is the smallest number of people required to allow transactions to take place. Fewer people than five would result in too few transactional opportunities.

A civic is based on or around a specific task or economic activity. It is a business in that it produces goods and services for sell to other members but it a community in that its members exchange goods and services with each other. Ultimately civics will become more specialized.

The growth and organization of civil society is natural and organic given an efficient economy. Ultimately all economic activity will be divided between twelve sectors. The Sectors are Defense; Transportation; Technology and Science; Communications; Energy, Mines and Resources; Industry; Sales and Services; Construction; Health and Welfare; Education; Culture; Jurisprudence. Each Sector has its own administration composed of an executive and CEO. The CEO’s of each Sector on each level form a council where they meet and discuss inter-sector issues such as purchases of goods and services from one sector by another. The Transportation Sector: city level purchases buses from the Industrial Sector: city level. Purchases and sales are all recorded on Asset Cards and are conducted on the level where the parties to the transaction work.

The CEO’s of the councils on one level form the council of the next level. There are 12 different administrative levels

Civics are based on friends helping friends. Members assist each other in finding ways they can help one another. All help is given a value and is tracked by means of the Rational Exchange.

If Bill buys a car from Sue the value of the transaction stays within the local economy. Credits are used by the group to benefit the group. Since the purchase of the car is a recorded transaction on the exchange the debt and the credit remain within the economy of the exchange to benefit the members of the exchange. Sue has earned credits from Bill, which prompts her to purchase goods and services from others on the exchange. Bill has a debt so members are encouraged to buy goods and services from Bill to eliminate the debt. This transfers the debits and credits to others in the group as transactions are completed. Thus economic activity remains centered on the exchange benefiting all members equally.

Regardless of how large the system becomes the books are always balanced, each group buying and selling equally from one another. The balance of the exchange is always zero, the purchases of some always equaling the sales of others.

It requires no money to join the exchange or to start up a Civic – since the exchange does not use money. Civics and the exchange are based on the principle of friends helping friends. The Rational Exchange simply makes formal what is now an informal activity.

 June 09, 2009; August 23, 2011; September 13, 2011

 

 

 

 

 

 

 

"Because Power Belongs To The People"

 


Ending Poverty 2

eliminating risk