Tuesday, June 28, 2016

Time Value as a Basic Commodity Good

Why might a more basic designation for time value, prove helpful? Time value - in aggregate - is not well represented in relation to other forms of resource capacity. As a result, total aggregates for the economic viability of human capital - in spite of massive investment and personal commitment - have not kept pace with other forms of international resource capacity. Since time value is also a perishable commodity, the losses continue to mount. Kevin Erdmann's concerns regarding housing, are just one of the problems in this regard. As he recently noted:
All finance institutions have been nudged to a posture where mortgage finance is unavailable to the bottom half of the economic distribution.
One reason housing is such a disconcerting factor, is that mortgage finance is practically a cultural determinant for access in general equilibrium conditions. But instead of addressing the need for economic access on more practical terms, policy makers and central bankers are drifting even further, from economic and monetary representation for all citizens. How do governments and policy makers live with arbitrary central banker assessments, given the fact government budget projections rely on long term nominal income stability as well? Progressives and conservatives alike, have become more inclined to rationalize limits to growth. Possibly the only difference, is that progressives are more disturbed by a desire to return to a gold standard, given the implications such a standard holds for services formation.

Regular readers already know how I feel about arbitrary limits to growth. After all, did policy makers ever inquire of their their citizens, whether they believe this to be a logical response? Still, growth needs to be redefined, so that time value can forge a stronger alignment with other forms of resource capacity. Human capital in aggregate, would greatly benefit from a stabilization process. For starters, time value can be utilized not only as asymmetric income, but also as a basic commodity good on symmetric terms. How might this occur?

An equilibrium corporation would "process" time value as a "raw commodity", allowing participants to contribute time value for housing and services formation which normally tend to lie beyond the reach of moderate incomes. This form of corporate structure would generate greater velocity for time based product transactions, which also translate into asset gains. Human capital is today's low hanging fruit, which - astonishingly - has yet to be picked. As Adam Smith once noted:
The most advantageous employment of any capital to the country to which it belongs, is that which maintains the greatest quantity of productive labor, and increases the most annual produce of the land and labor of that country. 
Time value as a basic commodity good, makes it possible to generate more labor force participation and non tradable sector wealth, without the high bar that is required for both in general equilibrium conditions. Each rise in the minimum wage can mean further labor market restrictions for all concerned - restrictions which continue to be papered over with Phillips Curve musings.

However, there's good reason why higher minimum wages still win the day: neither public or private interests have sufficient incentive to change the consumption requirements which can be a struggle for those with limited income. What point freeing up labor capacity, if doing so only leaves these groups of workers dependent on others with higher income? Economic freedom can be hard to find, if freedoms to produce and define consumption are left out of the equation.

Indeed, production reform for small configurations of non tradable sector activity, is the only way that an equilibrium corporation could compensate time value solely as a basic commodity good. Otherwise, without the ability to define alternative equilibrium, few individuals would be willing to assist assist these groups in their new endeavor, because any long term gains would be negligible at best.

Even though time value serves as a beginning point for the process, it eventually provides a stable base by which one can explore income potential. From this secure point, it would be possible to pursue the greater risks of economic freedom without becoming overwhelmed. All of this takes place from a vantage point which need not disturb the resource capacity of asymmetric wealth. Perhaps think of symmetric wealth as a "new colony", i.e. a new market which doesn't detract from the wealth of the old. Of those earlier "new colonies", Adam Smith wrote:
The new market, without drawing any thing from the old one, would create, if one may say so, a new product for its own supply; and that new product would constitute a new capital for carrying on the new employment, which, in the same manner, would draw nothing from the old one.

Monday, June 27, 2016

Considering Time Value

Why is it so helpful to think about time value, as both product and concept? What we perceive as time value exists in various dimensions - not all of which are economic in nature. However, money has become such an important part of life, that more of what we presently consider personal time value, would benefit from a clearly understood economic approach. Time value need not solely represent that which is assigned to individuals via their institutions, but also that which individuals are capable of assigning to one other as well.

Providing new economic frameworks for time value is not so difficult as it may seem. One of the best ways to think about this process, is the added value it would make possible in contrast to the UBI approach of paying individuals not to work or otherwise assist one another. In the near future, prosperous regions will provide less compensation for physical labor and/or repetitive work, in relation to work requiring non routine thought processes. Might a similar economic future also hold true for communities in general? A positive answer to this question, depends on whether time based knowledge product is encouraged more broadly, and whether average citizens are invited to take part in the process.

Economic time value is about more than just skill capacity. Think for a moment. How often, when we seek out time based product from others, do we appreciate most their focused attention on our circumstantial efforts, even more than specific skill sets they may have? A marketplace for time value would more readily account for differences between subjective product quality, versus "not always necessary" skill sets or objective outcomes (i.e. "I mostly just wanted him or her to listen"). Subjective time based product is more closely associated with the interactions of both participants as well - such as peer to peer learning, for instance.

One of the biggest problems for those who lack economic access in the present, is the way they are categorized, in spite of widely varying circumstance. In particular, there is a real need to get beyond the "low skill" mindset - a coarse brush which paints the vast majority of those not presently engaged in the workplace. Low skilled on whose or what terms? Without a marketplace for time value, there's a tremendous range of activities, interests and challenges that neither individuals or institutions are able to even represent, as available economic options. "Low skill" as a term, mostly indicates that societies have given excessive attention to specific forms of time value, knowledge and skill, instead of increasing market capacity for time value and knowledge use as a whole.

Also important, is the fact that those with limited economic access, have difficulty contributing to important public discourse - especially anyone who is not, or has not been previously employed in a professional capacity. Knowledge use systems could eventually provide a middle ground for the average citizen, between the separation of discussion at academic levels, versus the watered down media versions which are now adding instability in the political arena. Recent world events, of which Brexit is only the latest, highlight the need for all citizens to be a part of the economic arena which daily affects their lives.

Sunday, June 26, 2016

Random Thoughts on Knowledge Use Systems

Per the post title: Sometimes, part of the accumulating notes on my desk end up getting tossed, for no better reason than they lack a cohesive framework! I started out however, by questioning some of the similarities and differences that could occur in communities based along the lines of knowledge use systems.

Presently, I'm leaning towards "equilibrium corporation" as an appropriate name for a legal construct, since the term is more descriptive of the underlying rationale, than the "dual" designation I'd recently considered. Equilibrium corporation also provides a recognizable notation for economics as part of an educational framework. Too many political problems of the present, stem from a lack of economic understanding. One of the best things about compensated peer to peer learning is that today's K-12 public education is but a starting point, since some education basics can also be mastered on personal time via digital methods.

Not every community would be "newly created" in the sense of infrastructure and flexible building components for life/work options. An (alternative) equilibrium construct could assist older communities which are considering new beginnings as well. In some instances, partially abandoned neighborhoods might still be viable, provided local infrastructure can be salvaged or possibly reconfigured without excessive expense. I've not lived close to areas of extensive decline during my 60+ years, so admittedly don't know the extent of existing burdens that would be involved.

In other instances, "bedroom communities" could be created for system participants who wish to live near prosperous regions - particularly areas with limited ability to add greater population density for lower income levels. Indeed, it is becoming difficult to generate greater density for middle income levels in today's more prosperous regions.While these new towns would still have a multi purpose center or core, it would likely not be as extensive as "free standing" new communities with a broader array of ongoing activity.

Practicality for low income bedroom communities, also means creating simpler transport patterns to nearby cities. Affordable transportation infrastructure would not only make auto use unnecessary, but take advantage of resource sets within the realm of shared responsibility. In particular, citizens need transportation choices which go well beyond the present debate of self drive vehicles for major cities. As for the transportation difficulties of the here and now: one only wonders how many millions opt out of the workplace, because of the difficulties involved in maintaining older automobiles for long commutes.

Among the more inspiring visual components of these new communities, would be their walkable core. Beauty can become a part of local environment by means of shared time commitment, just as readily as disposable income. These could be among the first walkable communities created in nearly a century, for the average citizen (i.e. not high income retired) who wants to participate in a full range of economic activity without need of an automobile in central areas.

Depending on terrain of course, a series of "spokes" from the center (or downtown) would provide dedicated transportation options, so that different travel accommodations need not maneuver the same pathways and thoroughfares. The nature of these transportation options would help to determine as well, where individuals and families might prefer to locate, should they choose to locate inside of the areas where normal transportation spans the exterior of community boundaries.

Knowledge use systems would provide settings where a wide array of innovations and methods have a chance to be explored and discussed within common frameworks. When new communities are formed via the process of domestic summits, participants will have a chance to review innovation for building and infrastructure which often receives little notice otherwise in developed nations. Developed nations dismiss many such options out of hand. Too much housing has been built in recent decades which looks essentially like all other housing, and these developments use the same resource patterns which are mostly targeted for higher income levels.

Just as each alternate equilibrium construct would be unique, so too would be the environments they would generate. It has been said that variety is the spice of life, and even though these communities would be small by comparison with most towns and cities, in some respects they would actually have more variety and choice than can be found in their larger counterparts.

Update: Thanks to Miles Kimball for this Quartz article by Alex Balashov, about the unfortunate design of today's low density realm which was built especially for cars -  http://qz.com/698928/why-suburbia-sucks/

Friday, June 24, 2016

One Day Perhaps, Common Sense at the Margins

Why not common sense in the center, where it seemingly belongs? There's too many preexisting obligations all around - some of which have been a long time in the making. Governments and special interests alike, sacrificed political centers in ways that don't readily allow populist reactions such as Brexit to get at the root of the problem. Some noted in the Brexit aftermath that citizens wanted greater national autonomy, but for "the wrong reasons". What might that mean, for would be leaders who are anxious to make their countries "great again"?

Consider how governments became more involved in the economy, while constructing fiscal transmission processes via fiat money in the twentieth century. Where once the issues of fiscal revenue and redistribution were simple, they grew in complexity, as locally generated wealth transitioned to more specific and often, disparately held sources. When agriculture was still a primary wealth source for many populations, wealth creation meant understandable loops of production and consumption which - despite their simplicity - were also internally complete. In a sense, this local wealth "trickled up" to additional wealth generation. Even though these earlier patterns scarcely resemble today's non tradable sectors, they nonetheless served as a base from which tradable sector formation was able to grow and evolve.

In Adam Smith's time, governments expected to rely on the wealth generating capacity of their own citizens, regardless of world events. Might similar reasoning have factored in to Brexit votes? After all, a nation's economy supposedly represents its own citizens. Or does it? Again, Adam Smith:
But though a particular merchant, with abundance of goods in his warehouse, may sometimes be ruined by not being able to sell them in time, a nation or country is not liable to the same accident. The whole capital of a merchant frequently consists in perishable goods destined for purchasing money. But it is a very small part of the annual produce of the land and labor of a country, which can ever be destined for purchasing gold and silver from their neighbors. The far greater part is circulated and consumed among themselves; and even of the surplus which is sent abroad, the greatest part is generally destined for the purchase of other foreign goods. 
Doubtless, Brexit is a strongly held desire to rely on internal sovereignty. Look more closely for locally generated wealth in the present, however, and in some respects, a redundant phrase may apply: "There's no there, there." Indeed, the meritocratic and asymmetric compensation which nations have come to rely on, is based not on the circulation of locally held wealth, but that which more closely resembles the general equilibrium conditions of tradable sectors the world over. Meanwhile, central bankers mistakenly attempt to control the economic value of their nation's non tradable sectors, instead of supporting domestic aggregate spending capacity and the monetary representation of their own citizens.

Despite the benefits of applied skills preferences, total reliance on meritocratic structure, means too many citizens inadvertently become economic liabilities, in aggregate. When governments lose access to internally and symmetrically generated wealth, they rely excessively on externally defined sources of wealth generation. In other words, the very wealth of globalization, which governments and nations are increasingly inclined to react against. Still, the problem for nations is not that globalization was somehow "wrong". The problem was that nations allowed their non tradable sectors to completely rely on the gains of globalization, instead of finding means to generate new sources of economic access and wealth at local levels.

As more nations (and occasionally, states) consider secession, they need to take a much look closer at the structural circumstance which created their primary problems in the first place. The ability to generate reliable economic value (safe assets) closer to home is in doubt, since knowledge use is not only closely held, but dependent on the fruits of globalization even now. At the very least, it would be possible to rebuild and preserve applied knowledge for broader use, at the margins via alternate equilibrium.

The problem is not meritocratic constructs per se, but that they are the only pathways nations presently have, which are fully capable of providing much needed economic value. One can only hope that the winds of political uncertainty will not threaten to unwind the fiat monetary systems which for now are still capable of rewarding meritocratic structure. In the meantime, national revenues remain mostly dependent on the same global constructs, which governments sometimes wish to disavow.

Wednesday, June 22, 2016

The Strongest Link

Some might be surprised, of the degree to which Adam Smith held agriculture in high regard:
The capital, however, that is acquired to any country by commerce and manufactures, is always a very precarious and uncertain possession, till some part of it has been secured and realized in the cultivation and improvement of its lands. A merchant, it has been said very properly, is not necessarily the citizen of any particular country.
Few today, would consider the role of agriculture as quite so basic. What might account for the fact that Adam Smith emphasized agriculture over industry in this passage? For one, he recognized the merchant as part of what would become the international nature of tradable sectors. Even though all goods have some form of local origin, this expansive form of economic wealth belongs to all nations.

But by the same token, industry - with its relative lack of definable roots - was more subject to the vicissitudes of war. Patterns of commerce and industry could readily be broken down at any time, and - as had so often played out historically - not always reemerge with the same strength they held before exposure to the conflicts of nations. Whereas, local agriculture - while hardly impervious to the threats of war - still had higher chances of escaping such strife relatively unscathed.

Hence the above quote appears to highlight a belief on Smith's part, in agriculture as society's strongest link. Or more precisely, agriculture as rooted in the economic capacity of what was once every nation's citizen majority, via their contribution to a nation's most basic needs. When Smith lived - and indeed for a long time afterward - agriculture provided ready means for spontaneous coordination and cooperation, for people from all walks of life.

All too often, people forget how to cooperate and coordinate for their wants and needs, when they do not have adequate institutional means by which to do so. For centuries, agriculture provided economic cohesion alongside a strong incentive for family production, before giving way to the prominence of manufacture and commerce. What was perhaps less discussed, was the fact citizens were losing the most reliable production autonomy they had ever known. To some degree, governments must have understood what had actually taken place. After all, agriculture had also served as work opportunity for young and old, who would thereafter become underrepresented in the modern workplace. How much bearing might this loss have had, on the rationale of the welfare state?

Part of the problem for many citizens, was the loss of autonomy and self direction in terms of economic outcome. The knowledge based wealth which ultimately became so important to the economic foundations of nations, largely bypassed the work based patterns of citizens in many areas. As a result, a growing number of communities and regions gradually grew dependent on the places where knowledge use was allowed to flourish. Where once local citizens provided points of stability from which other forms of commerce had been able to expand and multiply, now local communities were forced to rely on resources that existed well beyond their ability to reciprocate.

Nations and governments alike, have forgotten the integral role of citizens as a foundation for economic stability. Instead of addressing the earlier losses of production rights, governments responded by establishing a welfare state. Now, as many of those government promises have become difficult to fulfill, policy makers grow anxious to scale back welfare states. There's just one problem: many have forgotten the particulars as to how these welfare states were established in the first place. Citizens will once again need clearer rights for production in the marketplace, should policy makers proceed down this path.

However, some factions are ready to double down on the earlier bets of the twentieth century, in a belief that governments will still be able to take care of their citizens on previously defined terms. Even though it makes little sense to reemphasize government power at this juncture, there are important reasons why it is happening. Too many supply side factions bear their own responsibility for a resurgence of Keynesianism, given the fact they have chosen economic stagnation over marketplace strength and full participation.

While Democrats and Republicans alike have created harsh limits on the supply of knowledge product, Republicans are paying the highest price in terms of party disarray. Even worse, is the fact all concerned gave progressives and financial interests the rationale that supply and demand is not central to economic activity. After all, special interests have seen to it that broad supply and demand for knowledge product in the marketplace, is mostly wishful thinking for dreamers and fools.

Just as agriculture was once the strongest link - because of its connection to citizens as a whole - knowledge use has the potential today, to fill that role as well. But if nations disregard this possibility, widespread knowledge use could just as easily lose its chance, to become a solid economic foundation in times of uncertainty. Indeed, the connection between time value and knowledge use was never as important, as it is in the present.

Tuesday, June 21, 2016

Experiential Product as a Structural Component

A marketplace for time value, would make it possible to generate experiential product which need not rely on (asymmetric) prior revenue or disposable income, in order to take place. Eventually, as more groups participate in symmetric compensation to generate time based service product, more economic output - hence a higher growth trajectory than is presently the case - could also result.

More economic output is important, if present day economic stagnation is to be overcome. However, people are confusing wage increases (on the part of some) with increased output overall, which unfortunately is not the case. Wage gains in aggregate, result from an increased degree of economic activity and circulation of marketplace product. By the same token, any increase in the growth trajectory of nominal income and spending also reflect increased output. Yet the ability to generate additional marketplace capacity has proven difficult of late, since doing so requires defining product along broader lines than governments and private interests alike, have been able to do.

At least for purposes of this post (as a glossary term), think of experiential product as non routine focused attention, intended for assistance in the circumstance and environments of others. Non routine focused attention is vitally important for the economic lives of all individuals, and not to be taken for granted from anyone in one's personal life, otherwise. Each individual's attempt to improve resource utilization and decision making, varies to some extent from the general knowledge sets that society expects to assist those processes. In spite of online assistance in multiple areas of life, confirmation or additional reference points on the part of others, can make a crucial difference in one's ultimate approach.

While I emphasize individual to individual activity as an appropriate starting point for economic gain, some forms of individual and group created experiential product don't need to be expressed on economic terms. Why so? Many spontaneously formed social activities would not benefit (economically) from compensated time value, especially if they are sought primarily as entertainment.

Indeed, the experiential product of entertainment which contains economic value, is that which is prepared for sale by individuals or groups for others as separately existing packages from individual time value. However, experiential time value as spent in entertainment with others (or in personal challenge) is not necessarily linked to group based mutual assistance, because many forms of human activity represent what individuals choose to do in any instance. In particular, activity which is family or otherwise tribal oriented, also tends to be less economically oriented. Think of informal local sporting events for instance, and personal preferences for home based activity which come closer to personal hobbies, than clearly existing family needs.

Such preferences are important to delineate, because compensating already existing time based preferences would remove the impetus for more productive forms of economic activity which encourage individuals to seek out strangers (i.e. more participants) to meet real service based needs. The more willing participants are involved, the less coercion is involved on anyone's part, for any single time based activity.

The whole purpose of envisioning experiential product as a structural economic component, is to bring people together who otherwise don't have sufficient social constructs in place, to be able to imagine doing so. Higher income levels understandably don't recognize what's missing in this regard for lower income levels, because time based services are such a part of daily life for the prior group. Even though lower income levels have a minimal degree of time based health and educational services at their disposal, it is not possible for society to apportion these effectively through asymmetric means. Hence education and healthcare provide an essential starting point, for experiential product in knowledge use systems.

Knowledge use systems would insure that people who otherwise remain socially and economically isolated, have a precise coordination platform which is not open ended (such as LinkedIn) for work potential, but generated to structure work within a defined group on a regular basis, in an ongoing time continuum. Put simply: through a reasonable structure which allows people to call on one another to sort life's confusions and aggravations, personal freedom and autonomy once again become possible.

How to think about experiential product in relation to the ways it has previously been discussed? Some readers may notice some dissimilarity to Wikipedia entries, so I'll look at a few contrasts. For experience good, I found:
...an experience good is a product or service where product characteristics such as quality or price are difficult to observe in advance, but these qualities can be ascertained upon consumption.
Experience good as defined by Wikipedia, appeared to be the closest description to defined real time product that was available. This article also stressed the difficulties posed for consumption choices, which in turn leads to lower price elasticity. Another subjective product is referred to as the "experience economy", which may also be thought of as business creating (memorable) customer events. Many knowledge use systems would gain opportunities to pursue this form of product, once they are well established. The prime experiential product I noted was a reference to movies, videos and other mass produced product as generated through time value, prior to sale.

What appears missing from the immediately available online interpretations, is subjective product with a focus on individual assistance. Also - as noted early in this post - contrast non routine personal attention, with the attention required for routine activity or objective service outcomes.

Of course, many time based activities that include specific or standard outcome, are those that are subject to automation - particularly in prosperous regions which include complex economic settings. Presently, individuals are being encouraged to seek work opportunities of a non routine nature, for long term job safety. Even though non routine work is somewhat of a safer bet, asymmetric compensation will continue to face limits due to budget revenue and lack of discretionary income. Hence a symmetric approach could prevent needless unemployment, and allow human capital a more central role as a time based consumption good.

Another way that time based experiential product differs from separately existing product, is the "passive" role of the consumer, in the latter. One of the prime benefits of time based experiential product, is the opportunity it provides for the consumer to take an active role, which translates into a flow of mutual interaction. The blogging format - much as other online formats - can provide an interesting partial time shift, in that some interaction between provider and participant is still possible. Indeed, asymmetric compensation tends to only allow a partial degree of mutual interaction in aggregate, between professionals and consumers.

Even though some knowledge use systems would eventually seek to engage in group based research and development, peer to peer assistance needs to be fully utilized and understood, first. Otherwise, differences in aptitude make it too tempting to divide work patterns in ways which eventually devolve into layers of administration, such as what now exist. By fully integrating peer to peer assistance, automation choices and unemployment would no longer be perceived as threats. Further, the maintenance of a non hierarchical group format, makes symmetric compensation and organization a feasible long term goal.

Sunday, June 19, 2016

Economies Would Benefit From an Equilibrium Approach

Economic access is not simply a matter of "too much" or "too little" income or taxation. "Too much" or "too little" in relation to what, exactly? The interconnected nature of general equilibrium conditions, means any attempts to remedy specific parts will affect the whole to some degree. Hence general equilibrium problems would benefit from public dialogue which transcends the ongoing battles of relative wages, income and taxation.

When policy makers approach problems from partial equilibrium framing, often the result is greater equilibrium imbalance. An apt example for equilibrium perspective, is the recurring battles over gun control. Instead of imposing yet more rules and laws yet again, why not work together to redress equilibrium imbalance? Doing so, would ultimately mean that people have fewer incentives for using guns on one another in the first place.

General equilibrium settings can be envisioned as shared marketplace capacity, between tradable and non tradable sectors. The complex effects these sectors have on one another in terms of growth capacity, are not yet well understood. This is all the more problematic, given high level government involvement in non tradable sector activity. Even though government "crowds out" private sector activity, too much of this process occurs with the implicit "blessing" of the private sector - in spite of protestations that circumstance are otherwise.

Sometimes, government crowding out almost seems beside the point, as time based product is called into question because it is not generated through viable and sustainable means. Here, knowledge applications are questioned, because of the fact they take place on terms that are simply too open ended, in terms of shared resource capacity. In other instances, the wrong parties are continuously blamed for supply side deficiencies, in what have been deemed crucial areas for applied time based activity. It does not seem plausible, that the marginalized get the blame for seeking access to the forms of time based production which they have not been deemed capable of providing on their own.

How does a lack of equilibrium balance contribute to so many problems? Tradable sectors developed their share of wages and income in relation to actual resource capacity, i.e. that of currently existing revenue and capital. This setting also actively contributed to ongoing product formation and marketplace expansion. A balanced equilibrium would imply that non tradable sectors take a similar approach, but alas this was not the case. Rather, today's non tradable sector activity is a completely open ended structure, which also has not proven capable of gauging aggregate resource capacity in real market terms.

Non tradable sectors estimated the aggregates of wage and income, based largely on whether or not political factions were in their favor. As a result, this open ended structure - which did not lead to direct (i.e. time or resource backed) wealth creation - meant permanent dependence on tradable sector wealth, in aggregate. Had existing resource capacity for national tradable sector activity been taken into account (also in relation to similar international tradable sector activity), non tradable sectors would not face the current wage/income impasse which now contributes to worldwide productivity losses. As a result, hiring is either partially curtailed or continued at lower levels of compensation.

Just the same, non tradable sector formation is likely somewhere beyond the early stages of crowding out tradable sector marketplace capacity. Should this crowding out process be left unchecked with no marketplace alternative, central bankers may incrementally decrease the level of aggregate spending capacity which represents both sectors.

A recent post from Marcus Nunes, shows how this process has already been occurring for some time. There's a way to think about the gradual shift downwards, which puts additional pressure on both nominal and real growth levels. How so? In some time periods, non tradable sectors will claim a relative greater share of total resource capacity than tradable sectors. Their relative inflation, as contrast with the good deflation of tradable sectors, also decreases the tradable sector representation for that period, when a hard inflation cap is in place. Since this adjustment draws down total existing resource capacity from which non tradable sectors derive their revenue, inflation caps gradually draw aggregate spending capacity downward.

Is it possible to set non tradable sectors on more sustainable paths, which do not continue to draw down resource capacity for both tradable sector activity and combined activity overall? One reason for today's political gridlock, is the fact it's difficult to fight the multiple battles of equilibrium imbalance within the structure itself. UBI can be thought of as such an attempt to fight a problem at general equilibrium level, from within. In a recent post, Scott Sumner noted the lack of political feasibility for UBI, because of the political issues involved. How does one willingly "step away" from government promises such as Social Security and Medicare for instance, if there are not viable long term options to reduce risk?

Much as inflation targeting represents an arbitrary cut off point on the part of central bankers, governments also become inclined to throw up their hands and institute arbitrary cut off points such as UBI when general equilibrium issues have gone unaddressed for too long. Rather than everyone having to face arbitrarily cuts for entitlements in the near future, why not provide the choice of an alternative equilibrium approach in the present?

Today's government promises are risky, but the only thing more risky is relying on private enterprise which does not yet have a built in continuum option for previously applied time value. The best way to deal with risk in a manner that approaches a government promise, is to build an internal time continuum which links time based wages to asset and service formation. It's an approach which still leaves the participant free to gamble their resource/income equivalency if they wish, but in which one's time/wage equivalency can maintain the protection of both individuals and the participating group.

Alternative equilibrium is an equilibrium response which need not jeopardize existing equilibrium structure. No one set of economic rules should have to suffice for multiple differences in lifestyle preference and wage/income potential. Democracies only fall into disrepute when opposing tribes attempt to impose their beliefs on one another, as if there were no other choice but to do so.