It’s getting to be rather a bad habit around here. And it all started with the Magna Carta. Bear with me. Many more qualified people have explained the ins and outs of the recent bank failures in our crazy financial system, here and here. I also have talked about the energy implications of money before.

I don’t want to talk about FDIC insurance. I want to talk about story.

MONEY IS A STORY

It’s a story we made up when we moved beyond a barter economy. It’s a brilliant story! I make cloth, and you grow apples. I want apples, but you don’t need cloth. So I give you a  tiny piece of metal instead, trusting that eventually somebody is going to need cloth and will replenish my stores of metal. None of us need the metal for anything, but it stands in for everything we do need.

Evolve that miracle system long enough, and apparently, you get pure imaginary money where we don’t even need the little pieces of metal, and we just tell each other we have it. What a story!

ANOTHER STORY: MONEY IS POWER

Another metaphor for money is power, which according to a basic dictionary, is the ability to either get things done or to make other people get things done. For most of human history, the guarantee on both kinds of power was violence and coercion. Do what I tell you because I have a big sword. Do what I tell you because I have all the little pieces of metal you need to stay alive. Do what I tell you because your eternal soul is in jeopardy if you don’t.

Do what I tell you, or bad things happen.

After a hard, millennia-long fight to declare that human beings are inherently valuable and threats and coercion are not the best way of organizing ourselves, we’ve gotten to the point where now people collect both kinds of power by promising it’s going to benefit everyone. At least a little bit.

Nowadays, they even occasionally work to make that happen when we do give them power. So instead of the point of a sword, we have stump speeches and ads about how great your life will be if you do what they say. Instead of serfs and subjects, we have customers and voters.

To sum up: in thousands of years of evolution, we’ve gone from doing what I say because I will hurt you if I don’t, to doing what I say because you’ll get something out of it too. Progress, I guess!?!

WE’RE MISSING PART OF THE STORY

The story of money changed, and culturally we have not caught up.

For the majority of our history, often called pre-history, which is hilarious, it seems like no one human was able to accumulate a huge amount of money or power. There were rich and poor stone age folks, and we do have the archeological records to prove that, but in general, keeping everyone alive was a group project. Most of life was communal and real close to the edge of subsistence.

Then we got agriculture, started settling down, and started valuing land and resources. And ever since, power has started to accumulate into ever fewer hands.

TO THE KINGS

Let’s skip ahead a little to the Kings. I think it’s a mistake to try and homogenize the politics of the ancient world. I know that there were actually a lot of ways that we organized ourselves, and there were quite a few egalitarian, matriarchal,  democratic, and pretty much every other way to politic in the world. The book, the Dawn of Everything (affiliate) brilliantly walks through the diversity of human politics. But the world powers that eventually dominated learned to concentrate political and economic power in one man/institution.

NO MORE KINGS

And then began the largely thankless work of clawing back and limiting the power of those men.  It took us several millennia in fits and starts and backtracks and success. We had an explosion of democracy, briefly, in southern Europe. We had the meritocracy of the Chinese government system but under the emperor. We had the Magna Carta declaring the rights of men in England that the pope immediately declared completely invalid and King John basically ignored. And many, many more examples of greater and lesser success.

But we got better and better at it. Most countries came up with a system of government where political power is split between many different people who are supposed to keep an eye on one another.

ALL BAD ROADS LEAD TO HITLER

Alongside the official changes, we changed our story.

We instinctively believe that no one man should be able to make decisions for an entire population and that when that happens it is almost entirely bad. Just witness the change from the word king to fascist. Practically, there’s no difference between them, just the story we tell about their actions.

I don’t think we’ll ever be done with this fight. Especially these days, there are constantly men arguing that it would be better if we all just did what one guy said again. But there is also always an instinctive counter-reaction that that’s a really bad idea. We can play out that story really easily in our minds and end up at Hitler.

THE WORLD HAS CHANGED AND OUR STORIES HAVE NOT KEPT UP

Since the industrial revolution, economic power, and political power have been split, and the people who run the government are not the people with all the money. Yes, they’re usually rich. There is great overlap, and they help each other out a whole lot, but the king used to be the richest man in the country. That is no longer the case by a long shot.

So on the political side, we have several millennial-long fights to balance political power and make sure the people who are telling us what to do are at least pretending it’s for our own good and have a bunch of other people with the power to stop them watching them.

WE JUST DON’T HAVE THE SAME INSTINCTS WHEN ECONOMIC POWER CONCENTRATES

We have had private citizen billionaires for 200 years, and we’ve already suffered the devastation of extreme economic concentration once as a world in the 1920s and many times in much smaller amounts since. And we came up with some really cool ways to fight that concentration, mostly with regulation and unions. And some really not cool like early systems of communism that just ended up with a different hierarchy. And we promptly forget all of those lessons again and again, because it’s just not in the story yet.

Culturally, they’re mostly still good guys.

Yes, their reputation has tarnished a little, but mostly due to personal weirdness, not the number in their bank account. We think of how convenient their products are. What geniuses they are. How amazing they are compared to the great towering intellectuals of previous times. They have big conferences in Switzerland where they try to solve the world’s problems.

It’s just generally thought of as a good thing to have a ridiculous amount of money. At the very least, we believe it’s fair that the labor of an entire society is going to very few people.

WE NEED A NEW MAGNA CARTA

Hopefully, it will work better than the original one. We are at the very beginning of this fight for the story of economic power. Who has it; who should have it and how we limit it.

It’s probably going to take a few more wobbles before we grow the same instincts around economic power that we have around political power. We need an allergy to extreme riches the same way we are now allergic to kings. Because it really is no different.

It should be just as ludicrous to concentrate economic power the way it’s ludicrous to concentrate political power.

HOW DARE THE POOR?

Right now we have a lot of the opposite – the laziness of welfare recipients, the unfairness of redistribution of wealth, and the insane policy that as you go up in the income brackets, you go down in taxes. The whole global economy is invested in enriching a few people.  That’s a story.

Another story could be that one man is completely incapable of creating that much value for the world by starting a company. That people with loads of success are should be responsible for funding loads of the structure that undergirds society that enabled their success. That helping struggling people actually enriches and uplifts everyone. That a strong social safety net actually leads to more wealth because more people can take more risks. That keeping everyone in the game is more important than ensuring one dude wins the game.

None of this is TRUE. None of this SHOULD HAPPEN. It’s all just a story too. Maybe none of these things will end up in our final story about money.

We left reality the second some dude in Turkey handed another dude a Lydian Stater, a misshapen lump of gold and silver in 600 BCE with a couple of animals stamped into the metal and exchanged it from actual flesh and blood real animals, and everyone went away happy from that transaction.

Since it’s all imagined anyway, why not imagine a story that goes a little better for a few more people?

The post Why Money is Just a Rollicking Good Story first appeared on Postcards from Pluto.

Well, maybe. Someday.

It’s important to note that sustaining a tiny sun on earth may never be possible; though we said that about the energy! At the very least, this solution is decades and decades away.

If it ever happens, what does it mean? Let’s do a little world-building, shall we?

One of the most fun and important steps of writing speculative fiction is, well, speculating. Change a variable in your made-up world and play out all of the implications on money, religion, gender, power all of it.

Variable: We now get energy from fusion, not from ancient dead plants.

What does a world like that look like?

POWER INDUSTRY

I feel like this would be the least changed, ironically, since it doesn’t fundamentally change electricity. We already have the grid. We even have real estate for power plants. We just hook our existing cables to a different source. (Which, hey, we don’t have to wait to do! The same is true of all green energy too! Yay!)

TRANSPORTATION

What if you could go anywhere you wanted for the price of a car or plane? It puts a whole new spin on globalization, borders, fiancé visas, and moving for work. People will get a whole lot more mobile with a whole lot less fuss.

ECONOMICS

Here, things start to get more fun. Our insanely complex economy obscures the fact that money is energy and energy is oil. The whole of our economy would shift completely if we switched to a different fuel source. This is where fusion and green energy start to diverge because oil is old sunlight and solar is new sunlight, so there are still recognizable constraints on both.

But when we make our own sun?

Power gets cheaper, so that is one bill shrunk immediately. Food gets way cheaper. (Do you know how much oil it takes to deliver a pineapple to your average grocery store?) Building things gets way cheaper. Which means everyone everywhere gets a lot more disposable income.

This is so hard to imagine because right now, the excess is getting funneled up to a few individuals and why would it be any different with fusion?

But that is deceptive because we don’t have endless energy. In fact, energy is getting more and more expensive. Digging up oil is more expensive; rich countries have already exploited all the poor countries, and there are no new frontiers to vacuum up for money. So now we’re cannibalizing ourselves and hollowing out the middle class and pushing the poverty line down to continue the merry-go-round a little longer. But what happens when that squeeze lets up and there’s just always more energy? They can hoard as much as they want, and for the cost of a power plant, there’s more where that came from?

LABOR

If living expenses become a fraction of your salary, current monopolies become harder to maintain. The labor market gets tighter. The robot revolution takes on even more importance. Job perks become insanely more important. And work weeks would get shorter, which I know is something that has been predicted for decades, but instead, we’re all killing ourselves by enriching billionaires. But if there was no limit to energy, even billionaires can have their cake and eat it too.

ART

Everyone will have a lot more time, which means amateur art will experience a renaissance.

All of these are relatively small changes at the personal level. Professional art and sports will also improve like we can’t possibly imagine. Why? Because more people can participate, and more people will have the resources to devote to full-time study. Right now, pursuing professional athletics is a game of desperation, luck, and sacrifice. What if all those variables were two clicks easier? Even a slight change in how easy it is dramatically changes who wins.

POLITICS

The global order as we know it would be over completely. It would take a few decades, but the Middle East would fade from importance as their main export becomes useless. Oh don’t worry, we’d still compete for resources like precious metals and raw materials, but the pinch points would shift around the globe.

The talking points at home would also shift as everyone gets a little bit less desperate. What would be the selling point then in a political campaign? Perhaps the culture wars become even more important?

HEALTH

Healthcare is one of the most resource-intensive industries we have. It just takes a lot of money to keep people well. So what happens when you glut the system with energy? Hopefully, again, less desperation. More access. More resources to put towards research. More positions funded. And yes, probably more 21st-century diseases as food becomes more ubiquitous and we can get more for less, so staying active becomes even more of a choice.

MILITARY

Oh, the wars we can wage with endless energy. The weapons we can dream up. Even the fusion plants themselves can be major targets. But also, hopefully, the fewer wars we’ll feel we need to wage. We’ve waged purely ideological wars, but the majority have been over resources and if everyone has more, you take those off the table. [She says, naively. I mean, optimistically…]

TECHNOLOGY

Tech of all sorts will accelerate rapidly. Building complex machines takes a great deal of energy. If that suddenly got cheap, AI computing suddenly looks totally doable. Cloud storage that currently has to be built on literal rivers to keep them cool becomes much more feasible. New players can have access to more, more informally, to invent things much more quickly.

SPACE

Getting off the planet also becomes ridiculously easy when you strap yourself to a tiny sun. As does mitigating the inhospitableness. It’s hard for humans not to live on earth. Which means we start becoming a true space-faring civilization. Though, that literally means our little solar system. I think we forget how big the galaxy is. We’re not going that far.

ENVIRONMENTALISM

Getting off oil has been the rallying cry of the green movement for decades. Plus cleaning up climate change will take a truly insane amount of energy. I think we turn more and more to technology and geoengineering to fix it instead of behavior change, and we deal with a host of unintended consequences. I mean, we’ll still be the short-sighted, reactive species we are now. Free energy won’t change our ability to screw up our main safe haven, but at least we won’t be actively setting more of it on fire anymore.

EDUCATION

This is another resource-intensive project that will hopefully get easier and more ubiquitous every decade, especially worldwide. Raising kids in general takes an insane amount of energy.

INTENSITY

The last way to think about this is not what exactly is changing but how much. There is a plausible scenario where a new energy source plugs into our existing extractive capitalism. Billionaires become trillionaires, and the world order pretty much stays the same.

On the opposite end: if everyone truly, madly, deeply has enough energy to live and to move, the concept of a nation-state as we know it dissolves and we become a truly globalized society where you can be employed anywhere by anyone and the world looks NOTHING like it does today.

WHAT’S YOUR GUESS?

Is this what’s Going To Happen? Some of it, yes, and some of it, no. That’s the difference between telling a story and trying to foretell the future. These are just some of the different ways to think about how changing things change other things.

Do you agree? Disagree? It’s within the realm of possibility that this could happen. Okay, very far from now and still more unlikely than likely, but it’s within the realm of possibility!

Is it the start of a grand utopia on earth?

No, we’re far too competitive, violent, and short-sighted ever to achieve that. But will life get just a little bit easier? Absolutely. When you have enough energy, you get more time and have to spend less of it surviving, which makes it just a little more pleasant.

Everyone will hopefully be just a little less tired and a little less desperate. Tourism, arts, entertainment, and sports will loom larger in people’s imagination as the basics get cheaper. Global society will develop as moving becomes easy. The geopolitical order will shift completely and rearrange around the new mineral and raw material bottlenecks, not oil. And we’ll find ways to muck up the climate some other way and compete and kill each other for new reasons.

The post How to World Build a New Future with Endless Energy first appeared on Postcards from Pluto.

Authors of science fiction and fantasy have cultivated a special skill (beyond the ability to torture characters and be tortured by commas all authors acquire). Simply, we speculate.

Yes, all authors need to build a world, but we spend hours (or months, or years…) creating an internally consistent alien species or a complete currency and economic system to back it up. Put more poetically, it’s the ability to see the water we are swimming in and imagine something different.

How we pay for things is one of the biggest rivers

One of the things I’ve been doing more recently is using these world-building skills on the real world. It’s so hard to get out of our bubble without jumping into someone else’s that may be even more bizarre. Deconstructing the world in the same way you can construct a fake world is a way to pop the bubble, at least for a few seconds.

What a society is willing to pay for collectively, to tax, and what it insists is an individual purchase reveals everything about the true values of that society.

What are the prerequisites and rewards of any society?

What actually are taxes? One way to think about them are prerequisites to citizenship. Just by breathing, these are the things you get from your fellow citizens.

Anything that we pay for individually, literally our income after taxes, becomes rewards for productivity in our society. You only have access to these if you are a productive member of society. (And I can’t emphasize enough, that I mean productive in the narrow economic sense, not anyone’s value as a human being just by breathing, which is infinite! This is a thought experiment to try on a perspective.)

When this goes wrong, it goes REALLY wrong.

The most brutal regimes in the world often start with innovation in what should be a prerequisite and what should be a reward. When everything is a prerequisite and the government provides everything equally, you end up with some really boring fashion choices. Also, it’s never equal, and it’s usually unspeakably repressive.

But similarly, when somebody gets a great idea that everything should be a reward and the government should provide nothing to its citizens (or put another way, citizens should provide nothing to each other), you get somebody trying to sell shareholders on sewage treatment. And a fairly brutal time if anything goes wrong for you and you’re not in a private in-group of some sort.

What does it look like in a sane system?

What do we pay for collectively? (AKA, tax)

Things that are prohibitively expensive for an individual or even an individual company, but everyone can benefit from.

Building weather satellites, collecting data, analyzing it, and predicting the weather are prohibitively expensive for one person or one company to do, thus it behooves us to collectively launch them.

Which sounds obvious, but America’s launch of a new weather satellite was delayed over funding fights when one legislator said we don’t need government weather services because we have the weather channel. Until somebody asked where they thought the weather channel got its data…

The interstate highway system cost $500 billion in today’s money when it was built about 60 years ago. Jeff Bezos (and every other billionaire today) are worth less than half that. Even the biggest shipping company on earth could not have financed the roads it needs to operate in one country, but it was a drop in the bucket to do together.

Things that everyone needs but are only profitable at scale.

There is significant overlap with the first one, but there is a slight difference here, because the things in this bucket could be done by private enterprise in cities, mostly, but are not profitable in rural areas because there just aren’t enough people.

Highways and post offices come to mind. Also radishes. I’ve moved back to a rural area and have not had a fresh radish in a year. Apparently, they just droop when they’ve gone more than a few hundred miles from home?

Political wish lists for multiple or powerful constituents.

This one could go either way in the good or evil column. Politicians and interest groups get a bee in their bonnets all the time about what we should be providing for the community. They go ahead and try to convince us to fund it and often do.

This is how we get oil subsidies and solar subsidies in a climate crisis, bridges to nowhere, 5-cent bags, and several states where we tax candy made without flour at a much higher rate than those without. True story.

Things that we personally need to be productive.

Before your first day of work, there are a couple of things you need to be a productive worker that traditionally, the entire society funds.

One huge example is national education. Workers come into work knowing how to read and add and work in groups and all the other things that you learn in school. There are countries without national education so children who enter the workforce without the ability to pay are restricted to jobs that don’t require literacy.

Most developed countries agree that health is a prerequisite for working. If you are sick, you can’t work. In the US it’s a reward for productivity, in that your employer pays for your health and then stops if you’re sick. (Ask me how I know.)

That’s… a choice. It’s a weird choice, but it is a choice. We like to spend on national defense instead. Productivity goes way down if you’re invaded, so we collectively fund that to magnificent levels.

Protection for the vulnerable.

Every society has to confront the fact that there will always be members of that society who are unable to be productive or care for themselves or have anyone to care for them.

I want to seriously emphasize again that I mean productive in the traditional economic sense, and not in these folks worth as human beings or ability to contribute to the world by being alive, which is priceless.

This again gets very controversial as some people want private industry or a religious institution to be the one to care for them and believe it should be none of the government’s business. But most agree starving children should be a public responsibility.

And sometimes we publically fund just weird things for no reason whatsoever, like getting all the gold you want for $1 in Whiskeytown National Recreation Area. (Technically, you have to get it out of the stream yourself, but it’s yours when you do!) It’s also probably on fire, so good luck.

Behavioral control

We offer rebates or extra taxes to try to get people to do more of one thing and less of something else. This is controversial, both in efficacy and execution, but nobody seems to be able to resist trying it.

A high tax on cigarettes in part was meant to discourage cigarette use. First-time home buying credits privilege homeownership over rentals. Married couples make out like bandits in the tax code!

My favorite is the perverse consequences you see. Like when Greece taxed blue water, so rich people hid their pools under green covers. Or the most famous example when the British government offered a bounty for cobras killed in India, so people bred cobras to get a bigger bounty, with a net increase in cobras.

Moonshots

Much of our scientific and medical research is funded by the government in the US because a private company could never put together that amount of funding and remain profitable. But since profitability isn’t the goal, we can do crazy things like go to the moon or cure cancer or stop climate change because we can throw our collective might at these problems and not worry about keeping the lights on for another year. [She says optimistically.]

What things lend themselves to private investment or individual payment?

These are the rewards for productivity in society. i.e. what we do we our literal after-tax paycheck or profits.

Competition and choice are desirable and possible.

You can buy a $1000 car or a $1 million car or a house with one room and a house with seventy. Wherever products get better with competition and choice, it’s ripe for individual profit and private reward. Of course, hopefully, housing homeless people falls under protecting the vulnerable, but for the most part, when you get a choice, it’s better from private hands.

The fun stuff.

We’re just so weird wacky and wonderful that a government program to distribute board games would be very, very sad. Whereas the smorgasbord available can contribute to every taste. Flux Monty Python which is a fantastic game, by the way, serves such a niche audience that it needs the kind of agile freedom of private experimentation and private reward in the form of profitability.

Crusades and pet causes

A robust social safety net hopefully will keep the vast majority of people healthy and a robust National Institute of Health or equivalent will hopefully keep researchers working on big problems. But there are always going to be conditions or other problems that numerically just don’t make sense for a major investment. (I’m not saying that’s a good thing, just that that’s reality.)

It’s going to matter a whole lot to a very small group of people and it’s up to those people to fill in the gaps when you paint with a broad brush and get research funded or get projects done.

What does this look like in fictional societies?

It can get so fascinating! In the Dune universe on a desert planet, the phrase the author Frank Herbert constantly used was that “A man’s flesh is his own; his water belongs to the tribe.” Water was so scarce that it became a collective resource, a tax on everyone.

In Ursula Le Guin‘s radical novel about a true anarchy government, The Dispossessed, almost everything was collective, yet not exploitative. That was the premise she was exploring. Almost everything was a prerequisite of life and there were very few rewards. Everyone worked to provide for each other regardless of ability and though nobody had very much and everyone had a level of freedom that we have not matched.

Almost diametrically opposite, Ayn Rand’s Atlas Shrugged, explored a society attempting to be completely a reward where nothing is a prerequisite, and also not exploitative.

You can do this yourself. Take a current government benefit and make it a reward and see what perverse consequences might result? Public land becomes private, and what happens to tourism, economy, and employment in many parts of the country?

Or say what happens when, say, the internet becomes a public good, as it has in some places, and how that affects employment, oversight, censorship, good and bad? The possibilities are endless.

When things end up in the wrong bucket?

I’ve tried to stay relatively neutral in the writing, and not get into the politics too much, because that’s not the point of this particular newsletter. Mostly because I’m not in the business of making my blood boil every week. Or yours.

Plus, this will never, ever be resolved. We can and will talk forever about what to fund what not to fund, who pays for these things, and who is not paying enough. And even the best programs have inevitable perverse consequences. But I wanted to share this as taxes are due to maybe give you a new framework to think about these debates.

Is this something we should pay for collectively because trying to make a profit at it is a fools errand? Or is this something that’s better in private hands that it will be profitable or in such a niche that the majority of us are never going to care about it or one of the other?

One insane example: power.

In my opinion, a private electric grid is an insanity, because electricity is definitely a prerequisite for productivity in this day and age; installing one is prohibitively expensive, and you’re trapped by where you live, meaning you have no competition and choice. On the other hand, solar companies where each can compete to make the best product and the investment is within reach of most homeowners and businesses, you can shop from a company in Indonesia if that’s where you get the best deal, making it perfect for the private market.

Same product, two very different endings that become automatically political positions, but if you look through the lens of what is a good collective purchase and what is a good individual purchase and what is a necessary prerequisite for life, and what is a reward, and where we monumentally screw this up, you maybe see something a little differently.

The post How do you Tax a Made up World? first appeared on Postcards from Pluto.