American Samizdat

Monday, August 06, 2007. *
Humanity is rapidly approaching a crossroads, where we will begin cooperating on a scale that we never have before, or we will descend into a state of warring tribes like we have never seen before. Appeals to the conscience only work on those willing to listen, while it is the less altruistic who need to pay the most attention. If there is one thing that does get people's attention, it's the money.

In 1996, Bob Dole had a campaign slogan, "We want you to keep more of your money in your pocket." The first thought to cross my mind was, 'Thank God it's not my money, or it would be worthless.' The logic of this is that the actual currency doesn't belong to the holder, only its value. The monetary system is a function of government, which in a democracy is the people. Therefore money is actually a form of public commons, similar to a public road system. Instead of transportation, it's a system of economic exchange. While you are in total possession of the section of road you're driving on, its value is due to it being connected to those everyone else is on. So is the value of the money in your pocket due to its broad interchangeability. It is not an issue of socializing wealth, but of understanding what money is to begin with. Your home, business, car, etc. are private property, but the roads linking them are not. Money is more like the public road system, than private property. It provides a broad economic connectivity, without which the economy could not function.

Money has always been a form of public utility (Render unto Caesar...), but because it evolved out of barter and for much of history was minted out of precious metals to gave it inherent value, the issue of function has been confused with the issue of possession. Now all monetary value is a matter of public trust in government accountability and this is being abused to the breaking point. It was only a generation ago that the wealth of governments were still symbolized, if not based on the gold in the treasury. For many countries, it's now how much US dollars and debt they are holding. This is not a stable situation. When the liquidity bubble does burst, faith in the concept of printed money will be shaken to its core. In order to restore faith in an invaluable economic tool, it would be useful to emphasize this public function. There is no longer a gold standard and it is the taxpayer who bears ultimate responsibility for government obligations.

Here is a little history to consider in understanding why we are where we are.

As David C. Korten says, "revolution happens mostly due to oppressive and systematic poverty, only to start over again; it's cyclical" I'm not a big fan of 'revolution', however, I am a big fan of renegade evolution. Good article in any case. Tip o' da hat to, jbmjr.

I'm also a big fan of John Rawls

Rawls, and others talk about how intergenerational justice can be struck using savings rather than caps on spending per se. One of the means is a constitutional amendment requiring savings to pay for a minimum subsistence for future generations. Rawls:

The appropriate expectation in applying the difference principle is that of the long-term prospects of the least favored extending over future generations. Each generation must not only preserve the gains of culture and civilization, and maintain intact those just institutions that have been established, but it must also put aside in each period of time a suitable amount of real capital accumulation. This saving may take various forms from net investment in machinery and other means of production to investment in learning and education. Assuming for the moment that a just savings principle is available which tells us how great investment should be, the level of the social minimum is determined.

This seems a more sensible approach than caps on revenues/spending pegged to population/growth (as in the Colorado TABOR Amendment).

Of course, another problem is establishing a global savings rate.

"A Theory of Justice" (1971)
posted by Uncle $cam at 1:03 PM
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