The third path

The third path

Throughout civilisation, societies have always oscillated between being divided and united, they face hard problems with uncertain outcome, and where there are legitimate different approaches there will be disagreement and comparison between the different ideas. Societies are predisposed to take two different sides, it is what our own minds do, they compare two alternatives and decide on what is better for them, though when communities do this there are competing interests in what is better for whom which makes them more complicated problems

When these problems become gridlocked, when the outcomes are manifestly in the interest of one group over another, we experience crisis, a blockage in the normal process of finding common ground. It is easy to find these problems in our current society and think that they are unique to our time, but history has repeated itself so often we should not be surprise when this situation occurs and the solution has always been the same, whenever society feels like it is in deadlock and irreconcilable, that is when the third path always emerges and we move on and forget that we were ever divided, it becomes a non-issue. Whether that was on the issue of women's votes, slavery, monarchy, religious freedom, witches or whether the sun will rise in the morning, once a resolution is found, we forget we were divided.

However what is apparent in retrospect, is not clear in the moment, we repeatedly try to solve the wrong problem with the wrong solution, because we retreat into our bunkers on either side of the divides, we become blinded to the fact that there is a third way. Currently we are experiencing the effects of a society where a greater majority of people are feeling irrelevant and fear instability in their own lives. It is the result of a economy that is changing from one that is reliant on labour and is instead becoming capital dominated, as a commentator said, “the only thing worse than being exploited is being relevant,” where jobs are being replaced by automation, robots and artificial intelligence, it leaves people scared that they do not matter any more, not needed and are going to be left behind.

This is a tragedy of our own making, the economics that dominated when labour was all-important are what making people feel irrelevant now, especially in the transfer period between two economies. It should be a time of celebration, we are doing more with much less, the resources cake is getting larger, the amount of work it takes to provide the basics of life is vastly reducing, there is finally enough cake in the world for everyone and yet people are scared of never having another piece of cake in their lives. This is shows that current economics is failing us, if the pie is larger everyone should be getting a larger piece.

When the resources of the world increases, a successful economy should spread and increase the access to those resources for all as the economy has to be a shared benefit to all or it will be unstable and there will be a backlash against it. If the economy is failing to be of benefit to all, and it has to both be of benefit and seen to be of benefit, that is a guide that it is the wrong economic policy and system. Food banks, homeless people dying the streets, untreated addicts and those who are being left behind are the clearest indicators I can imagine for a broken system and the need to act. And I think this is the problem that we should be trying to solve, how to make people relevant, to give them stability and protect our local communities from the relentless pull of our value producing hubs that drains away the young and talented from their traditional homes, and destroys the stability and legacy of local economies.

The problem is not the hubs themselves, they are the generators of tremendous wealth and concentrators of ideas and serendipity, as well as being exciting places, it is just that people should have the opportunity to return home as well as have access to those hubs. What is wrong is the balance between the two, the wealthy and poor, the mobile and educated versus the local and traditional. We see this within countries, and between countries, there is a fundamental problem to solve and whilst free-market economies have created this wealth, they are far from perfect in any sense of the word. They were the good enough solution to ensure the absolute necessity of having an engaged labour market, it was more important to protect the workers than the fringe that was left behind, and the free-market still has a place in the solution.

It is the most effective way of getting rice into the bowls of the people, it enables millions of people to coordinate their actions without any central authority, what it does not do is solve the problem of those people who have ineffective demand. When a natural disaster hits a country with rich people, few people die as people can pay for their own relief, but when poor face the same circumstance, it is the event that pushes them over the edge, resulting in massive death tolls, it shows the most effective relief efforts need to get money rather than supplies to people, as the supplies are drawn to the money. The fact that there are a billion people who still live on just one dollar a day, is sadly living proof that this is true that there are too many people who have ineffective demand.

Though the way you start solving this problem is at a local and national level, you put the thing right that is wrong, you solve the problem of ineffective demand, you introduce a base level of income that is it is impossible to fall below and you do so in the simplest way possible, universal basic income. First and most importantly at national level, you have to be able to provide for yourself before you can start providing for others, though we certainly encourage a community of countries to pursue the same policy.

That is the basis for building a world community, where each member of that community has an historic income based on the wealth that their people have produced over the past centuries. Which would act as buffer to wild immigration as people tend to be sticky, even if they have less income they prefer to stay at home, they only leave when they can not earn any income at home or face chronic instability. A community of countries that minimises the use of force, that is commit to increasing people's control over their lives, that stands up to the strong and protects the weak, and insists on a duty of care of the actors in our economy (companies, governments, charities) that is proportional to their strength. That would be a community that people could understand and support.

We make people feel relevant by recognising the value of people and their social capital, the capital without which money would be worthless. That is why we are using money to solve the problem, because of how important it is to have a medium of exchange, a way of trading value between people, it is not supposed to exclude people or fail to reward capital (especially social capital as it underpins every other form of capital). It is a means of distributing the resources that our society produce, it was never supposed to be our master and it will only remain so as long as we live under the delusion that it should be. Money is a tool and how we use tools should not be fixed according to the needs of the last century where you had to force people to work otherwise the economy would collapse. We now have economies that are heading towards not needing labour to provide the basics of life, one farmer can feed a hundred people, the houses have been built and just need to be used more efficiently, transport will be shared and energy will have a lower marginal cost. These basics will be continue to become relatively cheaper, but impossible to buy if you have ineffective demand.

Whether we provide a full basic income immediately from consumption tax ( with luxury paying for others necessities), or whether a country first builds a national wealth fund to provide that income, is a matter for politics. What is was important to me is the direction of travel, that we start fixing the roof before it starts raining. We need to stop the hidden monetary expansion of debt and instead replace it with the honest money supply which increases with the needs of basic income, it seem to be a basis for more and honest societies, and could be the key to balancing out business cycles.

We need to start sharing benefits rather than pursuing autonomous individual rights, it would be wrong to ever claim that there is a right to basic income, but it is the most wonderful shared benefit for the whole of society, and it is a purpose and mission that would be truly worth pursuing. Many people work so hard at a personal level to provide their children with a good start and legacy, and this system would guarantee that legacy, it could not be wasted or thrown away, it would give everyone the benefit of a head-start, and every time you pasted Go you would receive two hundred pounds. It would be the kind of annuity and perpetual trust fund that very expensive lawyers spend huge amounts of time setting up and managing, whereas a central scheme would cost less than Vanguard to run.

In return communities would become more balanced with real income to support depressed local economies, income would follow the people rather than people following the income which would mean economies would be chasing and serving the people, not the other way round. People would use their incomes in the most efficient way for their purposes, so lower cost areas would become appealing for some people, making the hubs cheaper to live in and even more efficient. It serves the purpose of what a good society should be, free from force and with greater control for people over their lives. Money would serve the purpose of allocating resources in the most efficient manner, and reward people for doing so, being efficient would have real rewards, and it aligns the interest of governments and people, in finding the most efficient solutions (a lower cost of basic income would mean less public spending). People would also at last be rewarded and receive the returns on the incredible social capital that they have produced, and if there is any justification for government it is to solve the inefficiency of free-markets.

If you are looking for a third path to take at the moment, if you want to turn away from the labelling and hate of current politics, forget about arguments over how to protect what is ours and realise that the real problems is those who have nothing in our society today or fear having nothing and being irrelevant tomorrow. That is the issue that needs solving, and whilst basic income might not be perfect, it is the best solution that I know about. And if I am wrong, please point out better solutions, I would love to hear them.

mind your own business?

mind your own business?

What is stoicism?

What is stoicism?