7 ms·

Ushering in the age of Hypercapitalism with the Blockchain

33 points by skilesare 12y ago

hardwaresofton 12y ago
Interesting read... Two things: 1. I think the argument about objectivistic capitalism being immoral was not fleshed out enough at all, a claim is made that it's just as bad as governmental "theft", but I feel one of the most important distinctions, the use of force, is not covered at all. How do independent actors in the market force you to buy their goods (and pay their economic rent?) 2. The actual idea is extremely interesting, and I liked reading the paper. (SPOILERS) - It's interesting to think of employees as really working for a portion of future proceeds rather than current pay... However, I don't think this model fits all business types, and it doesn't go into the humanist aspects of what happens when businesses fail.
- skilesare 12y ago
  1. It is true. My talk has little of this. I was pissed at Ayn Rand when I wrote this. But I think I answered your question in another thread. If you run out of gas and walk five miles, the gas station owner has you at a disadvantage. He can charge you $50 for the gas can or $5. What is 'fair'? I'm not sure I know, but most of it is economic rent that you are 'forced' to pay. Mostly because you are stupid, but still... 2. One thing not covered in the paper is the compassionate bankruptcy that is in there. https://github.com/skilesare/art_and_democratic_hypercapitalism/blob/master/hyper_capitalism/clear_outs.md https://github.com/skilesare/art_and_democratic_hypercapital...
  - hardwaresofton 12y ago
    Ah thanks for the clarifications
skilesare 12y ago
I wrote the paper, ask me anything.
- ForHackernews 12y ago
  What makes this an academic paper and not a blog post?
  - wavefunction 12y ago
    It's not served up via a blog for one, I guess.
  - LesZedCB 12y ago
    He called it a paper. It doesn't need to appear in a peer-reviewed journal to be a paper...
    - skilesare 12y ago
      They called for papers and I wrote one.
  - mgob 12y ago
    I'm not an academic so I won't profess to be an expert about papers, but it struck me as odd that it was written in the first person. Felt like a blog post with lipstick. I'm under qualified to address the paper itself, but it was an interesting read.
  - BrainInAJar 12y ago
    LaTeX
    - VMG 12y ago
      Looks like LibreOffice to me to be honest.
- asciimo 12y ago
  This is what the PDF looks like in Chrome 41.0.2272.101 (64-bit) on Ubuntu 14.04.2: http://imgur.com/T1ln9Cl http://imgur.com/T1ln9Cl Looks fine when I download it and read in Document Viewer.
- 12y ago
mindslight 12y ago
The worst part about it is that Bitcoin won't even support pure capitalism as its supporters envision, but will precess into crony capitalism just as we have today. Money needs to be anonymous. When it is not, redemption and transfer will be given special preference based on who you are rather than an independent value. When you perform a transaction and its effects aren't solely the transfer of value or you even need to file paperwork to report it (!), you're not really dealing with money. When a transaction can be reversed after it's been made, you're not dealing with money. And while Bitcoin currently has these properties in that a name isn't tied to a transaction, the blockchain is simply a list of which psuedonyms gave what to who. It lacks the important property of "untraceability" which prevents malicious actors from tying nyms to your singular government mandated identity (cf Chaumian tokens) and therefore implementing these "features". (And for the inevitable response, no, ad-hoc mixes are not a solution. They force the attacker to be active (eg pass laws) instead of just passively watching. When untraceability doesn't apply unconditionally to every transaction, then transactions which attempt it will be gradually more frowned upon. It's not hard to envision a future where types of Bitcoin users are progressively forced to register their wallets).
- skilesare 12y ago
  I flip this on its head. Would you hold some apple stock anonymously? Probably not. You want the dividend. We move value transfer to a 'no cash without capital' so that you really aren't interested in being anonymous anymore...or if you are you are forfeiting a significant future benefit. (I do propose a system of privacy pools for transactions that need to be private, but in general this isn't necessary.)
  - Mtinie 12y ago
    > You want the dividend. Dividends can already be issued on some blockchain implementations. For example, https://nubits.com/nushares/introduction https://nubits.com/nushares/introduction
  - kanzure 12y ago
    > Would you hold some apple stock anonymously? Probably not. You want the dividend. Oh, that is nearly trivial with some of these systems. Dividends can be spent to the same scriptPubKey (or other mechanism) that controls spending the stock itself. I mean, in a system where there is apparently a "stock" asset, naturally.
deleted 12y ago
[deleted]
wobbly99 12y ago
This will not work and does not address the "externalities and consequences" that current capitalism creates and NEVER PAYS FOR! Is the plan that those costs be distributed to all the holders of Block-chain investments? Then it will certainly have a negative return AFTER taxes and real costs.
cubano 12y ago
I have always had some misgivings about capitalism. Well, I, for one, appreciate that you laid this out as the first sentence of your paper/blog post. And I'll agree to a point; capitalism is the worse system there is, besides everything else of course. No economic system devised will ever be able to directly fix the problems of "lack-of-humanism" that you so describe. As shredprez succinctly put it, "there is no effective way to control the inequities of power." The best our system...any system...can hope to achieve is to try to guarantee equality of opportunity, but not equality of outcome. Market-based systems such as capitalism have this feature baked into its' DNA, as the market can never afford to marginalize any individual or effort, via political means, that could threaten a working business model. Although the plutocrats certainly try their best. Blockchain technologies certainly have the potential to shake things up, unless, of course, its crypto gets cracked soon, which many here seem to think will be the case. [edits]
- skilesare 12y ago
  Did you read it? My ultimate conclusion is that our current capitalism is half way pansy capitalism. This concept takes capitalism to an extreme and adds a built in dampner for inequalities of power while still allowing for the power of the market to opperate. In a sense we force a more oerfect operation of the market.
  - cubano 12y ago
    Yes I have now, and I must admit I totally mis-characterized its content in my OP, and although I don't necessary agree with all of your POVs, I do appreciate the thought and effort you put into creating it.
- jchrisa 12y ago
  > the market can never afford to marginalize any individual or effort, via political means, that could threaten a working business model. Isn't the 20th century sorta proof of the opposite?
Animats 12y ago
Here's the author's bio: http://austin-fatheree.blogspot.com/ http://austin-fatheree.blogspot.com/ He's not an economist. He's a .NET and MSSQL programmer. What he seems to have in mind is a scheme where labor creates tagged money which returns rents to the laborer. There's a cost to holding money; all money is an interest-bearing loan. Whether this would result in a working society is questionable. Then again, we currently have some negative interest rates, which do the same thing to holders of cash. The bookkeeping complexity would be high, but there's enough compute power around to handle it. The size of the problem is comparable to merchant reward points, which stores are now willing to track for the smallest purchases. The "blockchain" is probably the wrong tool for the tracking job - too many small transactions. It would take a very authoritarian society to impose this scheme.
- skilesare 12y ago
  That is me...although that hasn't been updated in a while. I'm glad you were able to get that out of the paper as that is what I'm calling for...I have no idea if it will work or not, so I'm going to try to build the experiment. The bookeeping part is what is interesting. It is all already in the blockchain. We will have to solve bloat, but the current blockchain tech captures most of the info I need. I have some answers to the authoritarian side of things as well...but that isn't in the paper. Specifically elective taxation and the citizen veto of cash accounts where the citizen accounts can vote to veto the use of government accounts. To get the veto you have to pay the tax.
invalidbasis 12y ago
From an Austrian perspective, your proposal is garbage. Savings create wealth, period. In your proposal, you describe a system that encourages faster consumption (and thus faster depletion of resources, including the earth, people, etc.) and discourages savings entirely. How do you not see the fallacy in your logic? Why are you proposing reaping the planet's resources faster as an ideal way to do business? At least by hoarding, and slowing production, the world is incentivized to act more cautiously before blindly moving forward with its precious resources. I suggest that the system you proposed would result in the creation of a lot of unnecessary widgets, resources, and false markets. A world that would quickly deplete itself. Trying to solve inequality, by promoting more consumption on everyone's part, seems backwards, in my opinion. There is likely a greater moral wrong in using resources, than saving resources for a more legitimate purpose later on. Your entire premise that we should reform society to favor consumption (even more than it is already favored now) only exacerbates inequalities, because at the end of the day, all you have to do to increase the value of Bitcoin, or similar crypto-currencies, is incapacitate another user and render their wallet outside of the entire money supply; since, it would be cryptographically locked. The argument against Bitcoin, if any, is (that at some point) it's deflationary mechanics will incentivize the elimination of other users so that the remaining currency holders will hold a larger percentage of the pie. If connected to an AI that was simply hellbent on maximizing its percentage of the money supply, you can easily see how a machine could learn bad ethics.
- dnautics 12y ago
  Pardon, where in the paper do you see that society should be reformed to favor consumption? It is also hard to see how a blockchain technology would encourage faster consumption than an inflationary fiat system like that which we have with FRNs, but maybe I missed something in the OP.
  - kardashev 12y ago
    The OP is proposing a system where savings decays over time, which creates incentive to spend your money quickly while it has value, hence consumerism. This effect already occurs to an extent via the FED's target inflation rate of 2% per annum. This strategy can also cause malinvestment. A person or company is more likely to make riskier investments rather than a certain loss. These risks often lead to economic bubbles. I see what the OP is trying to accomplish, but it would likely lead to a turbulent economy.
natrius 12y ago
This seems roughly equivalent to paying laborers with equity so they have a claim on the full benefit of their labor. One difference is that this hypercapitalism scheme spreads the claims on rents across the economy rather than just within one company. That could be solved by paying laborers with a broad index fund. Of course, they'd have to sell most of their income to pay for things. Only their savings would remain as equities. This seems equivalent to being paid in the prevailing currency and using your savings to invest, which is the current system. It also doesn't require anyone to force people to use a currency with demurrage fees, which no one would voluntarily choose. Very interesting read, though. If you're going to implement this as an experiment, you'll probably have better luck building on Ethereum than a Bitcoin fork. The downside is that Ethereum isn't architecturally stable yet, which makes development a little rough. The upside is network effects and a blockchain you don't have to build or get people to mine.
- skilesare 12y ago
  I isn't roughly like that though. In fact, as a laborer, you must pay your employer in stock for them to have the privilege of paying you. The stock is going in the other way. I also don't spread it across the whole economy, but a specific part of the economy that the laborer interacts with. (after a few iterations you get a six degrees of Kevin Bacon effect, but most of the benefit is local.) But yes, the goal is the full benefit of labor. I'm going to start on bitcoin because of the infrastructure. The experiment won't be distributed, but it will get there if it is successful. Multi-sig is enough for us to establish the distributed accountability that we need.
TheMagicHorsey 12y ago
"... capitalism’s intrinsic reliance on taking more than its share in any one economic transaction. " What does that even mean? Capitalism the ideology takes more than its fair share of any one transaction? How does an ideology take a share? Does he mean bankers take more than their fair share? What is a "fair" share? If that is in the first paragraph, what hope can the reader have that this guy is going to think rigorously about things in the rest of his paper?
- skilesare 12y ago
  I could have been clearer here. I had a debate with a Randian that was trying to convince me that taxation was theft and I leaned a little too far in that direction with this paper. I specifically talking about the fact that a lot of 'profit' or 'economic' rent takes advantage of the disadvantage a person is in. For example, the gas stating that charges $50 for an empty gas can to the guy that just walked 5 miles because his car ran out of gas. Of course you CAN charge it, but should you?
roymurdock 12y ago
1. Naturalizing Cash > "What does it mean to naturalize cash? It means that cash must also suffer from entropy." Cash already suffers from entropy. One of the fundamental concepts of finance is the Time Value of Money (TVM) which (in layman's terms) states that a dollar today is more valuable than a dollar tomorrow due to its potential to earn a return over that time period. If you don't put your money to work earning a return, you are losing value. Inflation is another force that devalues the real value cash. Even if we take the author's unsubstantiated claim that we have "managed to control [inflation] well in the last couple of decades" as a truth (which is clearly refuted by the current deflation in parts of the Eurozone and Japan as well as the inability of the Federal Reserve to consistently hit a target of 2% inflation), inflation still reduces the purchasing power of cash. 2. Economic Rent as Theft > "Economic rent is the amount charged for a good or service above and beyond the cost of creation." AKA profit. Generating profit is not immoral, nor is it theft. The only way that I could partially agree with the author here is in the case of an oligopoly or monopoly forcing consumers to pay exorbitant prices for some necessary good. This is why we have the government, laws, regulations, and anti-trust agencies. 3. Making Everyone a Capitalist > "∑bT must be established so that it supersedes the value of the labor at the time the laborer gets paid. To do this we need to make everyone a capitalist. When one account pays cash to another account, we keep track of this and give the paying account a ‘share’ of preferred stock in the paid to account equal to the dollar amount paid." So basically hypercapitalism is a way to make every person into a corporation with dividend-paying equity. People contribute their own labor in order to obtain equity shares in other people. I think this is a cool idea. As long as the number of people in the economy increases without bound, then this idea could work. See the transition from PAYGO to fully-funded social welfare [0] as an example of another system that only works as long as the population is growing. [0] https://research.stlouisfed.org/wp/1997/97-022.pdf https://research.stlouisfed.org/wp/1997/97-022.pdf
- skilesare 12y ago
  1. There is a difference between the unit of a dollar and a value of a dollar. I think we need to degrade the units. Re:Inflation, it would be better to control this then to just let inflation take it's course. 0% inflation is the target. 2. I agree with you, but is it a black and white distinction or a gradient of gray? The truth is some rents are good and some are bad and it is very very hard to separate them...so instead we overwhelm them from elsewhere and make them matter less. 3.Yes. And the theory relies on the long term increase in human productivity. In the event of a near extinction event you're going to have bigger problems than the economy not working. It can endure short term bumps in the road and actually has anti-fragile properties when it encounters volatility.

33 points by skilesare 12y ago

Interesting read... Two things: 1. I think the argument about objectivistic capitalism being immoral was not fleshed out enough at all, a claim is made that it's just as bad as governmental "theft", but I feel one of the most important distinctions, the use of force, is not covered at all. How do independent actors in the market force you to buy their goods (and pay their economic rent?) 2. The actual idea is extremely interesting, and I liked reading the paper. (SPOILERS) - It's interesting to think of employees as really working for a portion of future proceeds rather than current pay... However, I don't think this model fits all business types, and it doesn't go into the humanist aspects of what happens when businesses fail.

skilesare 12y ago
1. It is true. My talk has little of this. I was pissed at Ayn Rand when I wrote this. But I think I answered your question in another thread. If you run out of gas and walk five miles, the gas station owner has you at a disadvantage. He can charge you $50 for the gas can or $5. What is 'fair'? I'm not sure I know, but most of it is economic rent that you are 'forced' to pay. Mostly because you are stupid, but still... 2. One thing not covered in the paper is the compassionate bankruptcy that is in there. https://github.com/skilesare/art_and_democratic_hypercapitalism/blob/master/hyper_capitalism/clear_outs.md https://github.com/skilesare/art_and_democratic_hypercapital...
- hardwaresofton 12y ago
  Ah thanks for the clarifications

skilesare 12y ago

I wrote the paper, ask me anything.

ForHackernews 12y ago
What makes this an academic paper and not a blog post?
- wavefunction 12y ago
  It's not served up via a blog for one, I guess.
- LesZedCB 12y ago
  He called it a paper. It doesn't need to appear in a peer-reviewed journal to be a paper...
  - skilesare 12y ago
    They called for papers and I wrote one.
- mgob 12y ago
  I'm not an academic so I won't profess to be an expert about papers, but it struck me as odd that it was written in the first person. Felt like a blog post with lipstick. I'm under qualified to address the paper itself, but it was an interesting read.
- BrainInAJar 12y ago
  LaTeX
  - VMG 12y ago
    Looks like LibreOffice to me to be honest.
asciimo 12y ago
This is what the PDF looks like in Chrome 41.0.2272.101 (64-bit) on Ubuntu 14.04.2: http://imgur.com/T1ln9Cl http://imgur.com/T1ln9Cl Looks fine when I download it and read in Document Viewer.
12y ago

mindslight 12y ago

The worst part about it is that Bitcoin won't even support pure capitalism as its supporters envision, but will precess into crony capitalism just as we have today. Money needs to be anonymous. When it is not, redemption and transfer will be given special preference based on who you are rather than an independent value. When you perform a transaction and its effects aren't solely the transfer of value or you even need to file paperwork to report it (!), you're not really dealing with money. When a transaction can be reversed after it's been made, you're not dealing with money. And while Bitcoin currently has these properties in that a name isn't tied to a transaction, the blockchain is simply a list of which psuedonyms gave what to who. It lacks the important property of "untraceability" which prevents malicious actors from tying nyms to your singular government mandated identity (cf Chaumian tokens) and therefore implementing these "features". (And for the inevitable response, no, ad-hoc mixes are not a solution. They force the attacker to be active (eg pass laws) instead of just passively watching. When untraceability doesn't apply unconditionally to every transaction, then transactions which attempt it will be gradually more frowned upon. It's not hard to envision a future where types of Bitcoin users are progressively forced to register their wallets).

skilesare 12y ago
I flip this on its head. Would you hold some apple stock anonymously? Probably not. You want the dividend. We move value transfer to a 'no cash without capital' so that you really aren't interested in being anonymous anymore...or if you are you are forfeiting a significant future benefit. (I do propose a system of privacy pools for transactions that need to be private, but in general this isn't necessary.)
- Mtinie 12y ago
  > You want the dividend. Dividends can already be issued on some blockchain implementations. For example, https://nubits.com/nushares/introduction https://nubits.com/nushares/introduction
- kanzure 12y ago
  > Would you hold some apple stock anonymously? Probably not. You want the dividend. Oh, that is nearly trivial with some of these systems. Dividends can be spent to the same scriptPubKey (or other mechanism) that controls spending the stock itself. I mean, in a system where there is apparently a "stock" asset, naturally.

deleted 12y ago

[deleted]

wobbly99 12y ago

This will not work and does not address the "externalities and consequences" that current capitalism creates and NEVER PAYS FOR! Is the plan that those costs be distributed to all the holders of Block-chain investments? Then it will certainly have a negative return AFTER taxes and real costs.

cubano 12y ago

I have always had some misgivings about capitalism. Well, I, for one, appreciate that you laid this out as the first sentence of your paper/blog post. And I'll agree to a point; capitalism is the worse system there is, besides everything else of course. No economic system devised will ever be able to directly fix the problems of "lack-of-humanism" that you so describe. As shredprez succinctly put it, "there is no effective way to control the inequities of power." The best our system...any system...can hope to achieve is to try to guarantee equality of opportunity, but not equality of outcome. Market-based systems such as capitalism have this feature baked into its' DNA, as the market can never afford to marginalize any individual or effort, via political means, that could threaten a working business model. Although the plutocrats certainly try their best. Blockchain technologies certainly have the potential to shake things up, unless, of course, its crypto gets cracked soon, which many here seem to think will be the case. [edits]

skilesare 12y ago
Did you read it? My ultimate conclusion is that our current capitalism is half way pansy capitalism. This concept takes capitalism to an extreme and adds a built in dampner for inequalities of power while still allowing for the power of the market to opperate. In a sense we force a more oerfect operation of the market.
- cubano 12y ago
  Yes I have now, and I must admit I totally mis-characterized its content in my OP, and although I don't necessary agree with all of your POVs, I do appreciate the thought and effort you put into creating it.
jchrisa 12y ago
> the market can never afford to marginalize any individual or effort, via political means, that could threaten a working business model. Isn't the 20th century sorta proof of the opposite?

Animats 12y ago

Here's the author's bio: http://austin-fatheree.blogspot.com/ http://austin-fatheree.blogspot.com/ He's not an economist. He's a .NET and MSSQL programmer. What he seems to have in mind is a scheme where labor creates tagged money which returns rents to the laborer. There's a cost to holding money; all money is an interest-bearing loan. Whether this would result in a working society is questionable. Then again, we currently have some negative interest rates, which do the same thing to holders of cash. The bookkeeping complexity would be high, but there's enough compute power around to handle it. The size of the problem is comparable to merchant reward points, which stores are now willing to track for the smallest purchases. The "blockchain" is probably the wrong tool for the tracking job - too many small transactions. It would take a very authoritarian society to impose this scheme.

skilesare 12y ago
That is me...although that hasn't been updated in a while. I'm glad you were able to get that out of the paper as that is what I'm calling for...I have no idea if it will work or not, so I'm going to try to build the experiment. The bookeeping part is what is interesting. It is all already in the blockchain. We will have to solve bloat, but the current blockchain tech captures most of the info I need. I have some answers to the authoritarian side of things as well...but that isn't in the paper. Specifically elective taxation and the citizen veto of cash accounts where the citizen accounts can vote to veto the use of government accounts. To get the veto you have to pay the tax.

invalidbasis 12y ago

From an Austrian perspective, your proposal is garbage. Savings create wealth, period. In your proposal, you describe a system that encourages faster consumption (and thus faster depletion of resources, including the earth, people, etc.) and discourages savings entirely. How do you not see the fallacy in your logic? Why are you proposing reaping the planet's resources faster as an ideal way to do business? At least by hoarding, and slowing production, the world is incentivized to act more cautiously before blindly moving forward with its precious resources. I suggest that the system you proposed would result in the creation of a lot of unnecessary widgets, resources, and false markets. A world that would quickly deplete itself. Trying to solve inequality, by promoting more consumption on everyone's part, seems backwards, in my opinion. There is likely a greater moral wrong in using resources, than saving resources for a more legitimate purpose later on. Your entire premise that we should reform society to favor consumption (even more than it is already favored now) only exacerbates inequalities, because at the end of the day, all you have to do to increase the value of Bitcoin, or similar crypto-currencies, is incapacitate another user and render their wallet outside of the entire money supply; since, it would be cryptographically locked. The argument against Bitcoin, if any, is (that at some point) it's deflationary mechanics will incentivize the elimination of other users so that the remaining currency holders will hold a larger percentage of the pie. If connected to an AI that was simply hellbent on maximizing its percentage of the money supply, you can easily see how a machine could learn bad ethics.

dnautics 12y ago
Pardon, where in the paper do you see that society should be reformed to favor consumption? It is also hard to see how a blockchain technology would encourage faster consumption than an inflationary fiat system like that which we have with FRNs, but maybe I missed something in the OP.
- kardashev 12y ago
  The OP is proposing a system where savings decays over time, which creates incentive to spend your money quickly while it has value, hence consumerism. This effect already occurs to an extent via the FED's target inflation rate of 2% per annum. This strategy can also cause malinvestment. A person or company is more likely to make riskier investments rather than a certain loss. These risks often lead to economic bubbles. I see what the OP is trying to accomplish, but it would likely lead to a turbulent economy.

natrius 12y ago

This seems roughly equivalent to paying laborers with equity so they have a claim on the full benefit of their labor. One difference is that this hypercapitalism scheme spreads the claims on rents across the economy rather than just within one company. That could be solved by paying laborers with a broad index fund. Of course, they'd have to sell most of their income to pay for things. Only their savings would remain as equities. This seems equivalent to being paid in the prevailing currency and using your savings to invest, which is the current system. It also doesn't require anyone to force people to use a currency with demurrage fees, which no one would voluntarily choose. Very interesting read, though. If you're going to implement this as an experiment, you'll probably have better luck building on Ethereum than a Bitcoin fork. The downside is that Ethereum isn't architecturally stable yet, which makes development a little rough. The upside is network effects and a blockchain you don't have to build or get people to mine.

skilesare 12y ago
I isn't roughly like that though. In fact, as a laborer, you must pay your employer in stock for them to have the privilege of paying you. The stock is going in the other way. I also don't spread it across the whole economy, but a specific part of the economy that the laborer interacts with. (after a few iterations you get a six degrees of Kevin Bacon effect, but most of the benefit is local.) But yes, the goal is the full benefit of labor. I'm going to start on bitcoin because of the infrastructure. The experiment won't be distributed, but it will get there if it is successful. Multi-sig is enough for us to establish the distributed accountability that we need.

TheMagicHorsey 12y ago

"... capitalism’s intrinsic reliance on taking more than its share in any one economic transaction. " What does that even mean? Capitalism the ideology takes more than its fair share of any one transaction? How does an ideology take a share? Does he mean bankers take more than their fair share? What is a "fair" share? If that is in the first paragraph, what hope can the reader have that this guy is going to think rigorously about things in the rest of his paper?

skilesare 12y ago
I could have been clearer here. I had a debate with a Randian that was trying to convince me that taxation was theft and I leaned a little too far in that direction with this paper. I specifically talking about the fact that a lot of 'profit' or 'economic' rent takes advantage of the disadvantage a person is in. For example, the gas stating that charges $50 for an empty gas can to the guy that just walked 5 miles because his car ran out of gas. Of course you CAN charge it, but should you?

roymurdock 12y ago

1. Naturalizing Cash > "What does it mean to naturalize cash? It means that cash must also suffer from entropy." Cash already suffers from entropy. One of the fundamental concepts of finance is the Time Value of Money (TVM) which (in layman's terms) states that a dollar today is more valuable than a dollar tomorrow due to its potential to earn a return over that time period. If you don't put your money to work earning a return, you are losing value. Inflation is another force that devalues the real value cash. Even if we take the author's unsubstantiated claim that we have "managed to control [inflation] well in the last couple of decades" as a truth (which is clearly refuted by the current deflation in parts of the Eurozone and Japan as well as the inability of the Federal Reserve to consistently hit a target of 2% inflation), inflation still reduces the purchasing power of cash. 2. Economic Rent as Theft > "Economic rent is the amount charged for a good or service above and beyond the cost of creation." AKA profit. Generating profit is not immoral, nor is it theft. The only way that I could partially agree with the author here is in the case of an oligopoly or monopoly forcing consumers to pay exorbitant prices for some necessary good. This is why we have the government, laws, regulations, and anti-trust agencies. 3. Making Everyone a Capitalist > "∑bT must be established so that it supersedes the value of the labor at the time the laborer gets paid. To do this we need to make everyone a capitalist. When one account pays cash to another account, we keep track of this and give the paying account a ‘share’ of preferred stock in the paid to account equal to the dollar amount paid." So basically hypercapitalism is a way to make every person into a corporation with dividend-paying equity. People contribute their own labor in order to obtain equity shares in other people. I think this is a cool idea. As long as the number of people in the economy increases without bound, then this idea could work. See the transition from PAYGO to fully-funded social welfare [0] as an example of another system that only works as long as the population is growing. [0] https://research.stlouisfed.org/wp/1997/97-022.pdf https://research.stlouisfed.org/wp/1997/97-022.pdf

skilesare 12y ago
1. There is a difference between the unit of a dollar and a value of a dollar. I think we need to degrade the units. Re:Inflation, it would be better to control this then to just let inflation take it's course. 0% inflation is the target. 2. I agree with you, but is it a black and white distinction or a gradient of gray? The truth is some rents are good and some are bad and it is very very hard to separate them...so instead we overwhelm them from elsewhere and make them matter less. 3.Yes. And the theory relies on the long term increase in human productivity. In the event of a near extinction event you're going to have bigger problems than the economy not working. It can endure short term bumps in the road and actually has anti-fragile properties when it encounters volatility.