Moneyless society : Would it benefit society?

[TheBigDog]

Originally Posted by TheFaithfulStone

Does anything but work have value? If oil was available in great pools, would it cost anything?

Uh-oh. We're fixing to discuss economics that's well over my head.

Labor vs. Marginal Utility. Sh-sh-sh-showdown!

TFS

I Like this angle, Stone.

When all else is removed my time has value to me. I can spend my time in leisure, or I can spend my time laboring and toiling. I have needs that must be met on a daily basis, food, water, air, shelter, protection, medicine. Without services or shared expertise I must labor for all of these every day. In the worst case the labor for these exceeds my capability to secure them and I perish. If I can have them readily then I will survive and have leisure time left over at the end of the day. So it is my time that has value to me. I want to spend less time toiling for essentials and more time at leisure activities.

If I offer to other people a service that saves them time, then I am providing them a value. So if I am a farmer, and I grow enough food for 1000 people, then I am saving those 1000 people from the toil of growing and harvesting food. Instead of them spending 2 hours/day gardening, they are now spending 1 hour/day coming to my farm. I am not just feeding 1000 people, I am saving 1000 hours of labor each day, what is that worth?

Five other men realize that they can stage my farm products closer to where people live. The open stores that house the food so that everyone can do their food gathering in only 15 minutes/day. They have each saved an additional 200 people from 45 minutes/day of labor. The people in that area have saved a total of 1750 hours per day of labor that they can now use for leisure. This is being accomplished by a farmer, five stores, and the farm workers and store workers. The farm workers and store workers are providing a service to the community of value to all the members. It saves them time each day.

One of the men in the community is an artist. He makes beautiful works of art for people to gaze upon. While people love his art, he does not provide a time saving value to the community. He provides a value of perception that cannot be measured in hours of labor.

Another man builds a building on top of a hill with a wonderful view. He spends 20 years of his life perfecting the structure. He had been taught the skills of a chef as a young man and had a natural gift for cooking. The restaurant will provide food and surroundings that are beyond the normal man's experience. He can serve 20 meals each day, but there are 100 people each day who seek his service. Who has the right to his meals? Who has the right to choose?

In a barter system the man may choose who eats based upon his current needs. He needs chickens, he barters with a chicken farmer. He needs furniture, he barters with a carpenter. But if his needs to not jibe with those who want to eat at his restaurant it gets more complicated. The chicken farmer hates the man and refuses to eat there. In exchange for chickens he takes vouchers for ten meals. The chicken farmer needs corn. One supplier of corn is willing to trade ten pounds for each meal voucher. Another supplier is willing to trade twelve pounds for each meal voucher. (The restaurant owner never cooks corn, so never has need for their goods.) Suddenly there is competition for the meal vouchers. They are worth more to one man than to another. Perception of value has come back into play.

The restaurant owner gets too old to continue running his shop. All he has ever done was provide a service in exchange for his needs. Now will stop performing any service, but he will continue to have needs for some time. There is a younger man who worked as his assistant who wants to take over the restaurant. An arrangement is made for the younger man to take over. The older man wants to move to warmer weather for his late years and he does so, but in doing so he is no longer in a position for the younger restaurant owner to provide for his needs. Basic food and medicine cannot be mailed hundreds of miles every day. The old man needs to fit into the value chain in his new community, but he has no history there. He must provide for himself, rely upon the donations of others (strangers), or perish.

All of the above problems are solved by money. The farmer is compensated for adding value to people's lives based upon how much money they are willing to pay for his products. If he charges more than they are willing to pay, then they will grow food for themselves and his farm will have no customers. The stores are in the same position. They take a profit from all the goods sold to maintain their stores. They work deals with the food suppliers to keep the prices low enough to allow a profit for themselves for the value they add in distributing the food. The artist finds people with money willing to buy his art. He can then use that money to fill his own needs. The restaurant owner didn't need to toil for 20 years to build his restaurant. He could find investors who would loan him the money for the construction. He can charge as much money as he needs to so that the demand for his services are equal to his supply. He can charge more than that but as he charges more his demand (due to the number of people who can afford it) will drop. He doesn't need to regulate his customers with his immediate needs, he can serve any paying client at any time. The chicken farmer does not need to trade restaurant meal tickets, he can simply negotiate a price for his chickens with the restaurant owner. The restaurant owner in fact can pay extra to have the very best chickens available for his restaurant, helping to provide the critical difference between meals he serves and those served by others. The corn supplier who is willing to pay more for meals at the restaurant can choose to use his money there more often than the man willing to pay less. The restaurant owner can sell his restaurant to the assistant, or simply continue to keep a portion of the profits. When he moves the money he has or makes is just as valid in his now area as the old, so there is no problem with transportability.

Barter can only serve a community so effectively. A pure barter system has limits of complexity that can be achieved in terms of manufacturing and services. It drastically slows growth and innovation because there is no way for people to invest in new ventures. Ventures above a certain size become impossible without government mandate, organization, and conscription of labor.

Money is awesome.

Bill

[Qfwfq]

Originally Posted by TheBigDog

Barter can only serve a community so effectively. A pure barter system has limits of complexity that can be achieved in terms of manufacturing and services. It drastically slows growth and innovation because there is no way for people to invest in new ventures. Ventures above a certain size become impossible without government mandate, organization, and conscription of labor.

Money is awesome.

Bill

Barter certainly makes things much more complicated than with a currency, but I disagree that it gives no way for people to invest in new ventures. What simply happens is that the most suitable, common basic necessity assumes the role of a de facto currency for the unskilled common labor forces. Even without gov't mandate or slavery, it's enough to pay them in cups of wheat or rice, which they can further trade. Even salt has been used. In past times this was often the way even when minted currency (the strict meaning of money) was used, but wasn't a thing for the common rabble. The investor, whether gov't or private, would simply trade his expendable assets for stocks of what the labor and knaves can be paid in, and pay higher and lower level people with different things. Even conscripted people and slaves need to be at least fed.

In short, what happens is that barter very readily gives rise to currencies, with precious metals and jewel grade stones being the most suitable thing for the wealthy and the merchants. Minting just does away with the need for using scales at each transaction and that actually is what requires a trusted super partes authority, a gov't mandate.

Today the term money is used of habit more generally than minted currency, indicating whatever resources of value a party can count on; of course even liquidity is less and less minted and no longer even represents a weight of material substance, its market value goes with the availability decided by central banks.

[scottk]

Originally Posted by Aki

People living in a society without money would have no motivation, and thus would just be sitting around all day and partying all night.

This is not a given. This is what we've been conditioned to accept. There are other possible compensation systems based on merit, etc that can be used. My concept is that it would be something that could not be transferred to another person but only assigned based upon efforts and contributions to society. Therefor everyone would be starting out from the same point. In order to raise yourself above the baseline, you'd have to put forth effort to better society somehow or provide needed goods/services. All basics would be free but the extras would require proof of merit.

[scottk]

I think that to implement any drastic changes to economics, the changes would have to be first implemented on a small scale in a place such as a new city or town and then expanded.

[Zythryn]

Originally Posted by scottk

There are other [eg not money] possible compensation systems based on merit, etc that can be used. My concept is that it would be something that could not be transferred to another person but only assigned based upon efforts and contributions to society.

If it isn't transferable, how would someone pay for non-basic services.
Other than the 'non-transferable part' what you describe sounds like... money
There is a minimum wage for people which (originally) should provide for basic needs.
Based on merit, people can get more difficult jobs or jobs that require more training or superior performance at a job allows for promotion.

I am open to the idea of society without money, but have yet to hear of any particulars of the 'new' system that will allow this to work.

[Zythryn]

Originally Posted by scottk

I think that to implement any drastic changes to economics, the changes would have to be first implemented on a small scale in a place such as a new city or town and then expanded.

You would need to make the town completely self sufficient such that it didn't need to interact on an economic level with anyone else outside of the 'experiment'. I am not saying this is a reason not to try the experiment. Just that it isn't going to be easy to isolate the small scale 'test site'.
On top of that, economic systems don't all scale very well.
For example, bartering works great on a small scale. But not so well when you involve lots of people/companies or people over large distances.

[questor]

Some form of money has simplified and permitted commerce around the world for centuries. If it ain't broke, don't try to fix it!

[Zephyrus]

Hmm... Seems to me that to abandon money completely (including any form of trade, barter etc.) the smallest practical unit would have to be a (mostly) self sufficient country. Say that a political party came into power that wanted to do this and had the support of the people how would they go about this? What if they first worked out whatever method they wanted to use for their moneyless society then when ready every citizen and company gave all of the money to a national bank. Internally they operated on this new society and produced everything they could make and/or need. For the things they do not have or can’t yet make they use the money in the central bank to buy goods/services from other countries. To keep from running out of money they could invest in foreign markets and export goods and resources.

The question is would this be stable? Would they run out of money? It might be interesting to try to model this to see what would happen. If something like this is possible it might be the way to actually start converting humanity to a society that is not based on currency. However the only way I could see that happening would be for a sufficient number of people to be dissatisfied with their life that they were willing to make a change. If most people are content there will be insufficient energy to make the change.

I’m assuming this new society works and they are living in Tomorrow-morrow Land…

[scottk]

Originally Posted by Zythryn

If it isn't transferable, how would someone pay for non-basic services.
Other than the 'non-transferable part' what you describe sounds like... money
There is a minimum wage for people which (originally) should provide for basic needs.
Based on merit, people can get more difficult jobs or jobs that require more training or superior performance at a job allows for promotion.

I am open to the idea of society without money, but have yet to hear of any particulars of the 'new' system that will allow this to work.

In some ways it would be similar to money but there would be some significant differences and would be I think going in the direction of the LETSystem method goods and services would be "given" and the performance of your duties in your "job" or "business" would give you credits which can then be presented as qualifying you for the higher goods and services according to the level you've attained.

I look at it as a combination of LETS and rewards clubs at hotels and such to some extent.

Transactions would be tracked but there would be no exchange of currency.

In ancient times this may be difficult to impossible but with computers and databases and security methods and such I believe it's very possible now.

This would virtually eliminate as means of getting ahead things like manipulation and cheating and stealing. You'd actually have to contribute to get ahead. What constitutes what levels of credit would be agreed upon by the participating people.

[pgrmdave]

Your method would merely create a black market for different goods and services. Remember, people will act outside of a system if it is in their best benefit, so any economic system must take this into account.