Saturday, June 22, 2013

Knowledge Use as Direct Democracy

While many notions of direct democracy nowadays seem far fetched indeed, it helps to put such thoughts in context, and I need to start doing that, as this blog is now "two months in" and so this is an important  post. My thoughts as to direct democracy are somewhat utilitarian. However, not in terms of forced redistribution of which I mostly disagree with (for services) on grounds of what have become totally skewed incentives. That is why - in terms of coordinated skills arbitrage - I insist on level starting points in time use as a free market tool for all economic actors, and this post will attempt to provided more explanations as to "why", in that regard.  I promise, an equal starting point is not the "evil" you may think it is! Perhaps some of the rationale here will indicate why a libertarian such as myself still believes that democracy has potential to work effectively.

First, the point in such a possibility as equal time use is not that we are "equal" to others in all respects (which we most certainly are not), but that we deserve equal opportunity to seek out what we deem useful arbitrage in community, from all who wish to utilize time in ways that are capable of somehow corresponding with our own needs and desires. Through ongoing and systematic voting for (desired) basic service sets as a "price" mechanism (to indicate possible time use and time investment potential), young people also gain an idea how to structure learning options which correspond with a community's changing needs. Such an educational base also serves as a jumping off point from which individuals can engage in special skill set preferences, which they then "market" as additional and more spontaneous community offerings. That same basic educational set can be augmented by "just in time" additional knowledge use in when it becomes important in larger group settings, as well. When we gain the opportunity to directly compete with one another in service offerings limited only by our own imaginations, nothing about life ever need be boring or mundane, again.

Why is this not possible with today's services offerings, where some are automatically gauged as "more valuable than others" based on one's "time sacrifices" or innate abilities? Unequal knowledge use rents ultimately change the playing field for every other economic player in irrevocable ways. People therefore try to revert to representative democracy to "force" policymakers to make up the differences, but there is simply no way to do so in spite of appearances to the contrary (Obamacare). Once skills sets are subjected to scarcity controls even to a small degree, there is no more turning back, thus the holders of said skills have to also limit the degree to which they can freely engage in the use of those skills. What's more, their life becomes mostly a sacrifice for the special privilege they were given, and so knowledge use in its present form is not unlike slavery in this respect - high paid though it may be. They become bound by the institution that sets the rules for the limitations, and have no free market by which to negotiate with the rest of us.

Whereas our institutions once provided strength for knowledge holders and governments as well by this process, the strength of these rent capture measures has begun to wane. This inconvenient truth is especially significant, in that it now lead to distortions of financial markets which in some ways serve as a last resort for societal attempts to find rebalance. Only by negotiation from equal vantage points can we regain strength in our economic dealings with one another. Unfortunately, much valuable knowledge use definition (in monetary terms) has finally become what accrues mostly to the one percent. In such a reality, arguments for less reimbursement "somehow" to knowledge holders in a system which also demands total sacrifice on their part, is mostly semantics. What's more, the efforts to do so only make the representative democracy that used to work in this regard, appear as a travesty in the present, because of its increasingly inability to remedy the problems caused by special privilege.

In a sense the Great Depression "forced the hand" of greater wealth creation that ultimately led to a resurgence in services on a greater scale than had previously been possible. However - in the present - wealth is not held in the same ways that made that earlier form of adaptation possible. To be sure, people remain aware that resources do not just "spring into use" by the fact of their existence, and the value of human ability is frequently extolled in this regard. For instance, Matt Ridley's book "The Rational Optimist: How Prosperity Evolves" was - for me - an inspiring read a couple of years ago. I read echoes of those same thought process this morning, as Mark Perry of AEI highlighted a number of points Don Boudreaux of Café Hayek recently made about human ability.

However, such arguments can often quickly devolve into ill disguised attempts at continued institutional control of human ability. In spite of limitations on progress which consequently is not quite "real" in a societal framework, certain important capacities of knowledge use are mostly reserved for the one percent because of the incentive structure itself. Such limitations are also why earlier civilizations have often advanced in important technological areas, only to fall back again. Interestingly, some of the common beneficial knowledge which survived and spread, has also been purposely devalued (old wives tales?) by institutions in the present (herbal knowledge for instance) only to resurface as derivatives and patents once again limiting benefits to a public that pays for something supposedly "completely new".

When people realize the degree to which so much vital knowledge has been removed from the public domain, they will finally become anxious to retrieve it and put it to use once again in the knowledge commons from whence it came, in spite of an ongoing backlash against specialized knowledge in the present. There are, for instance - healthcare options that institutions have little space for, which can be utilized at local levels by people freely participating with such knowledge as it encourages personal education and skills negotiations as a direct result of one's efforts. Again, equal time as true arbitrage potential is what makes the direct democracy aspect possible.

This is all the more important in that even representative democracy is somewhat endangered in the present, to a large degree because of growing knowledge use limitations. The same problems with (actual) scarce resources which make direct voting referendums difficult, make realistic voting options extremely difficult for what are now artificially bound institutional services. The same knowledge use limitations that made services growth possible in earlier economic times, only point to a decreasing aggregate utilization as economies mature, thus knowledge use limitations become a true hindrance to any nation's strength, in the long run. However, a government's willingness to trust its own citizens to provide services for one another, can make all the difference. In order to gain true free markets in services, we have to be free to both choose and participate, in order to make that happen.

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