Tech and Philosophy Unite
A plea for distributed ledger and economic personalism to come together.
It's time to discuss the details of how change agents from different communities can come together to empower all by creating a money and banking system to eventually replace the traditional failing one. The best opportunity to bring the right kind of change would combine the philosophy known as "Economic Personalism" (advocated by the Just Third Way movement) with the bottom up decentralized technology evolving around "blockchain" and related distributed ledger protocols.
ATTENTION CYPHERPUNKS
Economic Personalism would solve the conflict between capitalism and socialism by empowering all through ownership, shrinking governments but also reducing wealth disparity. It would accomplish these goals, not through redistribution of wealth or income, but through universal and equal citizen access to newly created asset-backed money and insured capital credit for investing in feasible private-sector capital formation. Your skills can make it happen along with decentralization, anti-fragility, etc.
ATTENTION MONETARY REFORMERS
Advocates of a fairer money system may be hesitant to look to blockchain and crypto technology because it seems to be geared toward speculation and personal gain at the expense of others. But it does allow any group to create at least a simple working model of a money system that promotes sustainability and justice. We must not let the opportunity pass to build and test a community-created system, because the regulatory environment could change.
THE PIECES COME TOGETHER
One reason there has not yet been an effort to build a Just Third Way cryptocurrency is it would need to include several different components of significant complexity; a very large undertaking. As time passes though, the awareness of the need for drastic change (and ever-frustrating lack of legislative progress towards it) is aligning with the availability of technology to create a sophisticated but fair money system.
Blockchain has given us decentralized immutable transaction record systems, first proven by Bitcoin, and is becoming more accessible for development purposes. Smart contracts, identity innovations and mobile payment technologies are also important parts of the possibility picture. Decentralized finance (DeFi) smart contract platforms like Ethereum, Binance Smart Chain, Cardano, EOS, Stellar, Polkadot and newer ones like Chialisp and Sandbox already have projects that are proving successful with short launch times and increasingly complex functionality. The development of a system that empowers all is no longer an insurmountable task or cost-prohibitive. And in addition to platforms, the path may already be partially paved by specific projects. There are opportunities for collaborations with existing communities such as the group behind the METER token, a stablecoin pegged to the value of the kilowatt-hour. Dr. Norman Kurland of CESJ has proposed using the price of a KWh as a monetary measurement. The proposed banking system could offer wallets/accounts that allow several different specialized tokens with frictionless transferability.
DEMOCRATIC MONEY
To understand more specifics of how tech and money philosophy can truly change the world for empowerment of all, a basic knowledge of the Just Third Way proposal called "The Economic Democracy Act" is needed. You can read about the core proposal here:
https://www.cesj.org/learn/economic-democracy-act/overview/
The all-digital decentralized version of the main idea would likewise provide an equal investment credit to all individuals who opt in, to be used to invest in new productive growth of dividend-paying corporations. The corporations would access the investment credit through competitive online DeFi banks that evaluate the feasibility of new green-growth projects proposed by the corporations. The new asset-backed currency would be created by an entity serving the role of central bank. The banks and central bank would be transparent in operation and owned by the individuals served by the system.
THE DIGITAL DETAILS
The investment credit would be provided to individuals using a primary crypto-token, in two modes. The first, a credit voucher unit for investment in the previously mentioned feasible projects. The second, a mature unit of currency to be used to settle any transaction in the system. The bank entity would convert the credit token into a spendable token when the citizen uses the spendable token to purchase the newly issued shares of the business, which uses the proceeds of the sale of shares to purchase new productive assets. A dividend-paying share smart contract would also be generated at the same time, and held in a long-term account of the individual credit investor.
The amount of the equal investment credit would be calculated on a regular basis by dividing the overall annual growth of all participating businesses by the number of individuals opting into the investment credit program. Each unique human being in the affected economy is eligible to have one credit investment account which would automatically receive the credit token at a periodic interval. When the account holder decides what feasible business venture(s) to invest in, they can initiate a transaction which triggers several actions. The business receives the credit token, the investor receives voting shares and begins the right to earn dividends, and the bank becomes the creditor (zero interest plus fees).
Investors would be required to provide multiple biometrics to prove they are unique persons with only one account. Additional social identity tools should also be required (possibly BrightID). Ideally the code should know identity, but humans should not. The investment accounts can be tied to wallets owned by each unique person for spending cryptocurrency into the economy, paying other wallet holders, etc.
GOVERNANCE
The governance system is of course crucial, and while the technologies that may be utilized are rapidly evolving in the community and there are many possible embodiments, it must be transparent and capable of adjusting, in a non-inflationary way, to the capital financing needs of the private sector. It can be centrally managed but the entity (possibly a distributed autonomous organization or DAO) would conform to a constitution, and the decision makers must be well-paid, replaceable, and highly accountable. (“Governance” in this description involves decisions about how the distributed ledger network operates.)
WE AIN'T PLAYIN'
Building a monetary system is serious business, but there may be a more "casual" way to prove the effectiveness of a new, different economic framework: Inside a game. Decentralized virtual worlds are becoming complex and customizable with the growth of blockchain gaming. Features like play-to-earn, NFTs, and reward tokens have enhanced gaming, but can also allow experimentation with how money works.
A WORK IN PROGRESS
In the original legislative proposal that this system mimics, the corporations are structured to pay dividends. This concept can be modified to work within the capabilities of the crypto community. For example the corporate entities can also be DAOs, but still required to pay profits out as dividends (or "staking rewards"). There are other questions to resolve in creating the system to conform to the core philosophy, such as: Do users’ wallets only receive the dividends and allow for immediate spending on anything? What if they were to sell “stock”? Could that be immediately spent? The traditional proposal is intended to build equity for lifelong dividend income. These are conversations you can be part of.
There are additional components of the proposal, which for a crypto-system would involve smart contracts to replace certain financial tools like insurance and bills of exchange; these are not explained here but are detailed at www.cesj.org.
UBI VS UBO
If this is the first time you are looking at this general philosophy, you may think “Wouldn't it be easier to just do a UBI?” The response is, creating money for consumption creates imbalances. It also almost always involves making government more powerful and therefore intrusive. Economic Personalism, and the theory that Louis Kelso called Binary Economics, closely match production and consumption, consistent with Say's Law of Markets. Think of it more as "Universal Basic Ownership”.
REAL CRYPTO ADOPTION
A Just Third Way crypto system, if built correctly, would quickly become the world's primary money and banking system, for several reasons. Existing crypto-currencies have not enjoyed widespread adoption for everyday use because the user experience is complex, and there is no significant incentive for participants, including retailers. Because capital is the primary need in business globally, it will be easy to get business adoption of this proposed system by mandating that any business which receives the capital credit investment, as an ongoing qualification for participating, must accept the crypto-currency as one form of payment in all aspects of their business. Individual adoption will be incentivized by dividends and long-term ownership wealth. There could also be development bounties for improvements to the user interface, especially smartphone apps. All of these positive factors will help bring adoption quickly. And as this high-adoption token becomes tradable on crypto exchanges, the speed of adoption of all crypto-currencies will be increased.
Humanity is ready for a transparent, fair system that is built on principles of sound money without the restricted growth that accompanies scarce assets like precious metals or Bitcoin. Unfortunately, many people think that sound money must be scarce money, but that is a myth propped up by those who profit from the exploitation inherent in today's flawed frivolous debt money.
LET'S TRY SOMETHING DIFFERENT
The key to making elastic money work is restricting the process of loaning money into existence to productive business growth only. This can be done using open source software, tokens, and smart contracts in a transparent manner that empowers all with ownership shares.
In the CESJ model, loans in the form of insured capital credit are made by the commercial banks (when the citizen-investor finds a feasible project to invest in), with the new units of currency being generated by the central bank. When the loan is paid off, the new currency is canceled.
DEV DEPT
The technical aspects of the proposed network can be worked out by experts. It may be proof of work, proof of stake, delegated proof of stake, proof of space and time, or other protocol. But the consumption of electricity should be minimized, and important capabilities such as throughput should be rewarded. There should also be little or no transaction fees. It may be that the above model of loaning money into existence in a way that benefits all can be applied to the productive business growth of building the backbone of this financial network as a starting point. These are the issues that need to be worked out with knowledgeable developers in the crypto space.
FOCUS ON THE GOOD
Some advocates of the Just Third Way have been critical of digital currencies, especially Bitcoin. While it is technically accurate that Bitcoin is based on nothing that can be considered tangible assets, to criticize it is bad strategy. An altruistic crypto-system project needs developers, and right now many Bitcoin gurus have financial independence that frees their time. That community is made up of people who share the "existing system is terribly flawed" sentiment; but have spent years thinking the proof-of-work model is the solution. Monetary justice advocates need to be diplomatic in our criticisms of their pet solution and praise their priorities of immutability, anti-fragility, trustless transactions and decentralized governance as we educate them about widespread ownership of productive capital through universal access to credit. We can find ways to bring the best qualities of both worlds together.
A CONSCIENCE
There is a growing segment of blockchain entrepreneurs who complain how tech has not yet reached the unbanked and impoverished. These are the people we need. And the world desperately needs a working model to prove that there is a solution to the conflict between collectivist socialism and monopolistic capitalism that empowers every human person with freedom and wealth to move toward ending disparity, concentrated power, corruption and human suffering.
We are just beginning to build a community at:
(Not affiliated with the Center for Economic and Social Justice, which will only be utilized as a source of information.)