The Perfect Economy?

Economics Political Theory
1

(Just to give you a quick introduction) I’m 17 and I am new to the site.

Recently I’ve been thinking about the perfect economy or the closet thing to it. The simplest idea that came to mind was an economy where no one would have to work, but everyone would still make money and get the work done (without working themselves i.e. having the lawn mowed while sitting on a couch). This might make me come off as lazy, but if you give yourself time to think the idea over you should realize it could solve a handful of problems.

So upon thinking this I assumed their needed to be some sort of an ideal facilitator. In my opinion any form of economy that infringes upon one another’s liberty is far from perfect (meaning the idea of slaves is out of question).

I’ll try my best to outline the idea:

unlimited labor force/ means of production + unlimited production = unlimited capital

It supports the basic idea that if everything were free people wouldn’t have to work and people could have as many goods or services as they wanted. The only flaw (and it’s rather large) is that there’s a big wide open question as to how the goods will still be produced without labor and how the services will continue without labor. This brings me to my last point - the ideal facilitator.

I can’t imagine this type of economy working right now because of a lack of resources (or intelligence), but I don’t think it’s too far fetched to believe it could work in the future.

Let’s say in the year 3000 (don’t ask me why) humans will have developed A.I. that are capable of every single task humans themselves are (except for thinking at a more complicated level and loving etc. etc.). A society that invests completely in these technologies to take on the roles of producing goods, services, distributing goods etc. etc. will not need a facilitator of trade at all. In fact there will be no need for trade at all (and while reading this you can replace the word “need” with “desire” if you need to) because everyone will have everything they could possibly want to trade for.

I think of it as a sort of society that would exist within an anarcho-capitalism society, but would actually seem to be an anarcho-communist society (at least as far as I can tell).

Any thoughts or concerns are basically what I’m looking for.

2

Scarcity. Two things can’t occupy the same space. Capital can make production more efficient but ends must always be prioritized. No amount of addition resources or technology will change this.

3

Your analysis is entirely flawed from beginning to end. I would have to write an economics textbook in order to show you why you’re wrong about everything. But I suggest that you take a few basic economics courses before you devote too much time towards discovering the “perfect” economic system. Here are a few basic things to consider:

  1. The factors of production are co-dependent, i.e., independently barren.
  2. Capital accumulation depends on a steady flow of savings and an accurate price mechanism guiding production/investment.
  3. You don’t understand scarcity. Individual’s are never entirely satisfied with their current condition, and economic goods are limited, by definition.
  4. Innovation, capital accumulation, and entrepreneurship require proper incentives.
  5. The subjectivity of value (and all economic phenomena in general).
4

I should probably point out that this is not the best economy for everyone. In particular if you are a greedy bastard who thinks you are better than someone else (or would like to be by accumulating goods that another person cannot accumulate) then you may prefer being a politician of some sort. On to my point:

  1. Explain this further rather than just saying the factors of production are co-dep. What does this mean against the idea?

  2. I don’t believe this is truly relevant to my idea, but feel free to explain your position further.

  3. I believe I do understand scarcity – this is actually one of the only problems I could think of, but when I did, I thought of it in this way.

(I’m being fairly generous) Let’s say you work 40 hrs. a week and 5-6 days a week. You get maybe 2 or 3 holidays and a vacation week if you have a solid job. You work for 40-50 years in this economy if you’re lucky enough. Let’s say I want a pickup truck that can act as both an airplane and a motor boat (aren’t I creative?). This product has not been invented or produced yet. Let’s say there are several other items that follow the same circumstances (I want it, but it hasn’t been produced yet).

Would I rather want to work 40-50 years, 50-51 weeks and 40 hours and each week so I could obtain these products or would I rather not work at all peruse a life with no financial limits and not have these products? IMO I would prefer the latter of the two.

  1. The best way I can think to reply to an argument in this case is to suggest that the incentive of acquiring everything you desire (or at least close to it) in the form of tangible objects (or services) is adequate enough. This may not be the case, but that is a matter of opinion that I’m not too concerned with (for right now). Like scarcity, I have thought about this too, but not too hard bec. I did put the time at the year 3000 and I did also realize the startup capital would amount to be an incredibly large sum of money. There may be some other ideas of how incentives could be given out (although the concept of a near anarcho-communist society would sort defeat the purpose of incentives - or eliminate them), but I’m no so much worried about incentives as I am the actual concept (meaning if everything needed to form the economy/ society was available - i.e. incentives - then “would it work?”).

  2. What about the subjectivity of value? Are you trying to say that people will only want items that are scarce? If you are, then I’m just going to ignore this point bec. of what I said in my first two sentences.

5

I’m not going to teach you all of economics. I told you to keep these concepts in the back of your mind when you actually begin to investigate economic phenomena in a formal or partially formal setting. I had the same confused ideas when I was your age, but you must understand that you know absolutely nothing about economics (I’m not trying to be offensive). In other words, you should first learn about supply and demand and equilibrium analysis (partial and general) before you try to figure out how to create the perfect economic utopia.

6

If anyone else wants to answer my questions feel free to otherwize I won’t think anything is wrong with the idea. This has been on my mind for a while - I’d kind of like to get it out of the way.

7

People have long been predicting the obsolescence of human labor. It hasn’t happened so far and it’s never going to happen. What has happened is that the amount of time and physical effort that you must invest to maintain a certain standard of living has steadily declined.

Labor is undesirable. Frederic Bastiat [says ](http://www.econlib.org/library/Bastiat/basHar2.html#Chapter 2)it this way:

Privation is painful… sleeping in the elements, hunger pangs, and so on. You can avoid privation by taking pains, that is, laboring. Contrary to Marxist theory, this choice between two evils is not some synthetic invention of evil capitalist industrialists. It has existed from the dawn of history and certainly before that. The choice between leisure or labor has always been a tradeoff.

This sounds very Venus Project-y.

That’s silly. Unless this AI is truly omniscient (able to truly and accurately anticipate all possible future subjective states of every single human being), trade will always be necessary. I wanted a bicycle yesterday but now I’d rather not have a bicycle and I would like to have a hammock. One solution is to dispose of the bicycle and get a hammock. A better solution is to sell the bicycle to someone else who wants a bicycle and buy a hammock.

Yeah, because matter and energy are not in any way constrained or limited.

Yeah, you’re talking about Venus Project. VP is voodoo nonsense.

Clayton -

8

It means that you cannot have trucks without steel plants and you can’t have steel plants without trucks, and so on. Everything is dependent on everything else. Please read this very brief, widely known popular essay to get an idea of what Esuric means.

Imagine you are stranded on a desert island. You can’t go fishing without a fish net. You can’t build a fish net without forgoing fishing. You’ll starve if you don’t “save up” a reserve of fish to keep yourself fed while you’re building the fish net. This act of “saving up” extra fish to feed yourself while you build a piece of equipment with which to catch more fish is called capital accumulation. It is the foundation of capitalism. The opposite of capitalism is not communism, it is primitive subsistence.

Everything you said demonstrates Esuric’s point - you don’t understand scarcity. Scarcity is the result of unlimited wants and finite resources. Air is not an economic good because it is abundant. There’s so much more than anyone wants that there is no possibility of conflict between any two breathing individuals. But very few things in the word are as abundant as air.

Economic goods are scarce, meaning that there is less of the good or service than people demand. The illustration I like to use is Dick Cheney. Cheney has long had heart problems. As VP, he was followed around by a team of EMTs who were on standby with defibrilators to resuscitate him at any time, if he were to have a heart attack. Now, peace-of-mind is something that people want and one way to satisfy that want is to have a doctor on hand 24/7 dedicated solely to your own medical care to jump in and save your life should anything happen to you. Obviously, it is arithmetically impossible for everyone to have this. Hence, wants exceed resources.

Nature has decided what constitutes human wants. Some people want to hurt other human beings and it is from hurting others that they derive the highest satisfaction. We call these people sociopaths. But that their wants are deemed to be an “illness” by most of the rest of us doesn’t change the fact that hurting other humans is what motivates these individuals and this is why they act. The pathological cases are illustrative because they break Utopias.

No, subjective valuation means that the same good or service has different value to everyone. There is no one, objective standard of valuation.

Clayton -

9

Clayton - thanks for responding. I’m not going to try to respond back to everything you wrote bec. that would take a lot of time and I’m feeling a bit lazy as of lately. If this idea didn’t work even if all the resources to make it work were available bec. of levels of scarcity and whatnot let’s say you could just decrease the amount of time one works by applying this idea to just one industry (I’ll call it that for lack of a better word).

Ex). Grocery stores were completely run by A.I. From robots that clean toilets and robots that grow food to robots that prepare fish… Since robots could work 24/7 there would be a seemingly unlimited number of products available to customers. And let’s say the products were free to anyone. Every single grocery store was just like this one.

I know this is an outrageous idea, but that’s irrelevant to my question. Incentives would still be a problem of course, but what other problems would there be?

10

What’s stopping you today? There’s a small fishing boat in a fishing village in Mexico with your name on it.

Z.

11

(Just to give you a quick introduction) I’m 17 and I am new to the site.

(Uh-huh.)

Recently I’ve been thinking about the perfect economy or the closet thing to it.

(Enter the Zeitgeist movement.)

The simplest idea that came to mind was an economy where no one would have to work,

(That would be the simplest, yes. But that’s because magic is also simple. The problem is that economics applies to any functioning society. A perfect economy is plagued with impossibility. In fact, by examination of the various thought experiments of economic extremes, a fluctuating economy is closer to perfection than any other, simply because of its ability to work out problems that couldn’t be sustained in something like an evenly-rotating one.)

but everyone would still make money and get the work done (without working themselves i.e. having the lawn mowed while sitting on a couch).

(What brought you to Mises after reading the Zeitgeist manifesto? Doubts?)

This might make me come off as lazy, but if you give yourself time to think the idea over you should realize it could solve a handful of problems.

(There’s that undefined “it” again.)

So upon thinking this I assumed their needed to be some sort of an ideal facilitator.

(Define your terms, seventeen-year-old.)

In my opinion any form of economy that infringes upon one another’s liberty is far from perfect (meaning the idea of slaves is out of question).

(Yes, always make sure to start with a non-sequitur that sounds great. Please do. I can’t wait to see what substance your following statements don’t contain…)

I’ll try my best to outline the idea:

unlimited labor force/ means of production + unlimited production = unlimited capital

(I challenge you to construe that abomination in any sort of coherent, pinned down, tangible reality. Even assuming an unlimited number of laborers, people or, as you’re imagining, magic robots. Means of production would not be something like the number 10. It would be a factory. Unlimited production is an idea, also not a number. Unlimited production would have to be a result, if anything, but to what? I mean, the market can produce endlessly in the confines of a scarce universe, provided it can reuse materials. Maybe I’m being too harsh. Maybe you are just a seventeen-year-old that’s totally new to this, which is why you know terms like “means of production”. But that being the case, you need to learn what math is.)

It supports the basic idea

(“It” being what? You people always say “it”. You have not defined this “it”. It has alternated its definition from an economic system to a plan, to just a word that can be used to start a bad argument. I bet I could change the word “it” in the Zeitgeist manifesto to “god” and it would read just like a religious doctrine. Well, I know I can, because it already does.)

that if everything were free people wouldn’t have to work and people could have as many goods or services as they wanted.

(While this is a basic idea, it’s a terribly flawed one, and not something that should be pointed at as being supported by an idea for how to run an economy.)

The only flaw (and it’s rather large) is that there’s a big wide open question as to how the goods will still be produced without labor and how the services will continue without labor.

(You know, if the only flaw in something completely disintegrates the idea…yeah…)

This brings me to my last point - the ideal facilitator.

(Which I’m sure you plan on defining at some point.)

I can’t imagine this type of economy working right now because of a lack of resources (or intelligence), but I don’t think it’s too far fetched to believe it could work in the future.

(You know, if we throw away the gaping flaw you pointed out.)

Let’s say in the year 3000 (don’t ask me why) humans will have developed A.I. that are capable of every single task humans themselves are(except for thinking at a more complicated level and loving etc. etc.).

(So not everything humans are. Gotcha. Are they better at math than us? Cause that could be a problem.)

A society that invests completely in these technologies

(Completely? Well, if the plan is to starve to death, we’re already off to a good start. I’m gonna let this slide and pretend that’s not what you meant.)

to take on the roles of producing goods, services, distributing goods etc. etc. will not need a facilitator of trade at all. In fact there will be no need for trade at all (and while reading this you can replace the word “need” with “desire” if you need to) because everyone will have everything they could possibly want to trade for.

(So you’re saying make an infinite number of everything? That’s what you’re saying. You’re completely disregarding that it would take resources to build these machines, to build the factories, to build the machines that build the things we will have an unlimited supply of. How do we figure out what to make? Who is deciding this? Because you can’t just say “We’ll make everything, ever!” and expect that the universe will pay up. That’s government thinking, that is.)

I think of it as a sort of society that would exist within an anarcho-capitalism society,

(It boggles the damn mind.)

but would actually seem to be an anarcho-communist society (at least as far as I can tell).

(I don’t think communism is this far-gone, to be honest.)

Any thoughts or concerns are basically what I’m looking for.

(How does “it” handle scarcity? Can you answer that? I’m really, REALLY concerned about this. If we’re supposedly making everything we want and need, how do we determine when to make new things? Is the limited thinking capacity of these machines that cannot love also going to have the imagination to come up with new ideas? Will our iPods improve? Or will they just keep making the same LCD screen technology for the next six thousand years, so to speak? I’m making some serious accusations about this system. Feel free to defend it. By all damn means, feel free. I know you’re only seventeen and all, but when I was seventeen I was running logical circles around professors with tenure, so I try to expect the same of others.)

12

If this idea didn’t work even if all the resources to make it work were available bec. of levels of scarcity and whatnot let’s say you could just decrease the amount of time one works by applying this idea to just one industry (I’ll call it that for lack of a better word).

(By taking money from other industries? What? You just want to say it will happen?)

Ex). Grocery stores were completely run by A.I. From robots that clean toilets and robots that grow food to robots that prepare fish… Since robots could work 24/7 there would be a seemingly unlimited number of products available to customers. And let’s say the products were free to anyone. Every single grocery store was just like this one.

(How is there an unlimited number of products available? You just redescribed a situation where this is the whole system. You still need robots to repair all of those robots, monitor them, monitor themselves, and repair themselves, which isn’t possible, so you need more repair robots. It’s like hiring nothing but bureaucrats, for god’s sake. And for free? If you’re talking about one industry, and saying all this would be done for free, who’s investing in this industry when all the other industries still have to have workers and pay them? Do you realize that we already make things efficient when we can? Robots build cars, but those robots still have to be repaired, and if the day comes where they don’t, it won’t mean cars will be free. It means all the people not working on cars are working on other things, and cars are merely cheaper. They are not produced unlimitedly, because at some point it becomes ludicrous to produce cars that people aren’t buying when those resources could build things people DO want.)

I know this is an outrageous idea, but that’s irrelevant to my question. Incentives would still be a problem of course, but what other problems would there be?

(The outrageous idea…that IS your question…is irrelevant to your question? Incentives aren’t problem enough? For a list of other problems, see above.)

13

For anyone interested, the comparative analysis of writing styles of the person posting this and the last Zeitgeist work I tore apart show striking similarities, which proves nothing but is very interesting. Maybe they all write that way.

14

What you don’t realize is that these arent’ even human beings… they are the first Venus Project AI robot prototypes. At this point, they’re pure software chatbots but the Prime Directive of Venus Project robots will be the Venus Project… so it makes sense to start by programming them to be able to explain their Prime Directive… the Venus Project.

Clayton -

15

Excellent observation. I think my favorite part is that it’s all worded so haphazardly that arguments sometimes crush themselves with contradictions contained in the same phrase. It’s like watching someone try to word things in a cleverly misleading way, but they just can’t get the “clever” part down.

16

Recently I’ve been thinking about the perfect economy or the closet thing to it.

There is no “the perfect economy”, as there is no objective “the”. You are attributing a qualification to an economic system based on your own goals.

If my personal “perfect economic system” was intended to “meet all human demand”, I may conclude that the simplest (and indeed, perhaps only) way of accomplishing that goal may be to eradicate the human race. True, people would largely have to sacrifice current demands (such as living, but they’re just being selfish and impeding progress… gotta crack a few eggs, you know.) No people = no human demand to meet = all human demands met! The perfect economy = no economy! I have found the key to Utopia and it is named Human Extinction!

Differing individual subjective values are going to produce different interpretations of what constitutes a “perfect” economy.

The simplest idea that came to mind was an economy where no one would have to work, but everyone would still make money and get the work done.

This goal is haphazard and ill-defined.
Why did you choose this as your ultimate goal? (why is no one working, and getting free stuff “perfect”?)

(without working themselves i.e. having the lawn mowed while sitting on a couch).

Define work (without giving an example, I want to know your most basic definition.)

In my opinion any form of economy that infringes upon one another’s liberty is far from perfect (meaning the idea of slaves is out of question).

Well if slaves were human it would be inherently incompatible with your initial proposed goal as someone would indeed be working.

Why is an economy that infringes upon liberty “far from perfect”, it doesn’t go against your initially stated goal. Are you deciding what is “perfect” or not on a whim, based on your subjective values? We probably can’t help much in that case. Again, this comes back to your initial goal being haphazard and ill-defined.

unlimited labor force/ means of production + unlimited production = unlimited capital

What is an “unlimited labor force”?
What is “unlimited production”?

It supports the basic idea that if everything were free people wouldn’t have to work and people could have as many goods or services as they wanted.

This “basic idea” itself is flawed, here’s a revision:

It supports the basic idea that if everything were non-scarce, then everything would be free and people wouldn’t have to work and people could have as many goods or services as they wanted.

The problem with this, is this doesn’t work in the physical universe we live in, which is a universe of scarcity. Time is scarce. Physical Matter is definite. And in the “universe of unlimited abundance” described above would mean that humans would cease to act, and therefore cease to be human.

The only flaw… etc.

The rest of this is pretty much irrelevant as you haven’t fixed that definite flaw above. It’s just speculation about technological advances somehow creating an impossible solution to scarcity.

But just for fun:

Let’s say in the year 3000 (don’t ask me why) humans will have developed A.I. that are capable of every single task humans themselves are (except for thinking at a more complicated level and loving etc. etc.).

If an AI wasn’t capable of thinking at a human level and at least emulating human emotion it would be unable to perform “every single task humans themselves are”

Define task.

If it were, and decided to act in it’s self interests (or a hive interest or anything other that a human interest) then what? Artificial intelligence slavery?

17

Here are two careers that your “perfect economy” can’t produce:

Prostitutes. Even with robots doing “everything” in the economy, there will still be demand for sex workers. Does this mean that some people still have to work (prostitutes) while others (factory workers) can sit around all day and consume the services of world class prostitutes?

Psychiatrists. People (factory workers) will still want to consume this highly cognitive service. Do psychiatrists still need to labor?

You could claim that these services could be created by robots. If you are describing a world with robot prostitutes and AI psychiatrists that are as good as the real thing, then I think you have to agree you are describing a world that is so different from our current society as to be incomprehensible.

18

Funny how you make the leap from prostitute to psychiatrist. The former may be difficult to reproduce, however the latter would require only a mannequin and a tape recorder… Hmmmm..very interesting…and how do feel about that?..Hmmm…very interesting…can you elaborate on that?

19

Touchable holograms.

You may now fill in this space with whatever fantasies you wish. Obviously there are some who will want to have sex with a “real” person for whatever reason; This only goes to prove that we’ll never really run out of work for people to do..

20

Thank you guys for responding. I’ve found all my answers in some form or another. I actually appreciate the humor at the end. In no way did I mean to say this was the perfect economy (hence the “?” mark and the fact that I was obviously asking what was wrong w/ the system from the start).