i should start this post with a disclosure that i have studied minimal economics at college level, and even when i did, i thought it was such garbage that i didn't attend lectures and barely passed (micro-economics: you can graph the hypothetical variables that can never be observed in the real world, that is logical and even beneficial to see the hypothetical effect of the change in one variable on another. but calculating the exact change in an un-observable, hypothetical variable, is intellectual w@nkery at its finest. just because you can, doesn't mean you should).
by the above disclosure, i am giving fair warning that i have little or no understanding of the subject i will be talking about, and am therefore almost begging to be corrected by someone who actually attended lectures / did more than 2 econ units.
when i originally envisaged the ample system, i thought there would be no money, no currency at all, as it is a tool currently used to further entrench the economic power of the elite. i say this as it isn't real, there is no difference in having a wad of money in your pocket to having a deck of cards - it is just pulped wood and ink. the difference is the belief that it is different, and the trust that it can be used in the future to purchase economic resources (ie a medium of exchange and a store of value). an implication of this is it stores the accumulated power of the economic elite to wield over the disenfranchised majority. the accumulated green pulped wood (or accumulated zeroes as it is now) only has this power because we the disenfranchised majority allow it to.
however i came to the conclusion that the benefits of open markets outweighed the risk of a currency, so long as the currency cannot be manipulated by a banking system. currently you have banks creating money through the fractional reserve system, you have a central bank protecting the interests of these banks to ensure 'financial stability' (translate: preserve the current financial and economic power structure), issuing debt as they feel is required to fix the price of money where they think it should be. they then cover-up poor business decisions by banks by purchasing toxic assets at inflated prices while the banks allow the real businesses and employers to die due to lack of funding.
but in an ample system - there is no debt, there are no banks, nobody is actively printing money or performing quantitative easing, individuals can't take out loans, businesses don't need funding and don't need to pay interest, or dividends, or provide capital gains on shares that no longer exist. there is no federal reserve rate to falsely manage business levels in an economy. the boom-bust cycle that has been observed for centuries in market economies is entirely a money and debt phenomena. a bust is where people can't pay their creditors, but in an ample system, there is no debt, liabilities are immediately settled, companies can go negative in their currency reserves as currency isn't real anyway. but those businesses that are least efficient are culled, to be absorbed by efficient businesses or to start new businesses based on new ideas, new products, new practices.
the defacto currency of 'hours', as mentioned before, is effectively printed when citizens work. assuming a random minimum quota of 30 hours that citizens have to work every week to have their basic needs covered plus a minimum level of luxuries, their 'bank account' goes up 30 hours at the end of the week. the qualifying business' bank account goes down a corresponding amount, and this feeds in to the efficiency measure of the business. the citizens then spend their hours on whatever they want (goods, services, infrastructure, research, gift it directly to others, total economic freedom). various businesses receive these hours as income, also contributing to their efficiency rating.
so at a basic level (ie, my level), as citizens work, they produce goods and services. except for a small timing difference (hours expire like reward points on a credit card, to ensure they can't be hoarded to obtain unfair economic power), total money produced in a period is equal to total consumption of goods and services at the consumer level. the higher the population, the more hours worked, the higher the money produced, and the more goods and services that are produced to be purchased. it would make sense to me, given corresponding amounts of both money and goods and services to be purchased, there would be a downward bias in prices due to progressive improvements in efficiency as the less efficient businesses are culled, and as innovative new technologies come to the market drawing demand away from outdated goods and services.
for businesses, they would purchase inputs from other businesses (or pay to extract it from the ground etc). if it has a positive balance of hours, it would show a surplus of income over expenses, approximately the same as profitability in a capitalist system. payment for these inputs / labour costs is therefore existing money circulating through the system. if there is a negative balance (only businesses are allowed to go negative, not citizens), effectively they are printing money, but still creating goods and services for purchases. as any new money is offset by a corresponding increase in production, it seems logical to me that there wouldn't be a sudden increase in money floating around the system, chasing the same number of goods, and pushing up prices.
government, by my thinking, should have no income at all. if they have an income it suggests to me they are providing a good or service, and in an economic system where it is so easy to start a business as long as there is demonstrable demand, this product or service would be provided by a (more efficient) private sector business. i see government agencies therefore being restricted to pure policy and regulation, plus services that should not be charged for (fire services, police, prisons, armed forces). the exception i can see being fines and penalties. government agencies would therefore be permanently with a negative balance of hours, any purchase from them increasing this negative would therefore be printing money with no offsetting increase in production. this would therefore have an inflationary impact, which isn't good.
in the capitalist system, this is coerced away via compulsory taxation, and any remaining deficit is covered by incurring debt (which is working real well for greece and other parts of europe at the moment, with other countries probably to follow shortly). the temptation for all government departments and politicians is to spend up from this bottomless well, which necessitates rigorous systems to limit this urge.
in the ample system, i would suggest no tax. by taxing, you create a self-justifying system for government expenditure. the default position is any tax income is to be spent, with any reduction in taxes a cynical ploy to pretend tax-payers are receiving largesse, rather than getting their own money back. and by default, the country pays for the government it has, whether or not there is explicit taxation. i think it is a valuable psychological tool to see government as a large expense, so that we can all readily see they are a burden on society and should be minimised.
the cumulative negative position would show how much of a burden they are, and i would suggest there needs to be a specified limit on government as a % of private. the auditors also need to be very active in ensuring maximum efficiency in government, with full disclosure of all expenses, and penalties in place to ensure no politician or government employee is receiving benefits not received by all citizens.
the inflationary impact from government would i think be more than offset by the deflationary impact of efficiency and no new money without offsetting goods and services in the private sector.
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