Wednesday, April 20, 2016

Notes on Democracy and Production Rights

When is direct democracy possible? Direct democracy is an option for services creation in small decentralized settings, when production (property) rights are extended to the creation of personalized time based product. Where time aggregates are approached as the resource capacity people are granted by nature, production rights would allow time to serve as "votes" for time based services production and consumption.

Consider the vast differences in time value, that exist in present day general equilibrium. Indeed, representative democracy is sometimes compelled to diminish the voting impact of "bad voters" who hold insufficient time value in the marketplace. And yet the "good" voter who holds "outstanding" time value, also gains from the fact that important forms of knowledge use were limited by design. Even though one hears of "makers" and "takers" who contribute to society or (supposedly) diminish it, many "makers" are no longer so much the producers of things, as simply the recipients of knowledge use privilege.

Today's democracies are caught up in an increasing struggle to coordinate what have become vast differences in the economic value of time. The broader the population represented, the more difficult it becomes to manage existing resource capacity alongside depressed aggregate time value. While wide variance in time use would be problematic enough at local levels, it is even more difficult, when knowledge use restrictions are imposed at national levels and involve millions of people. Too many public private associations for economic patterns have gotten in the way of production rights.

In some respects, representative democracy ultimately needs a different approach to resource capacity. National governments are well suited for the circumstance of tradable sectors which are responsible for product formation at international levels. Even though government budgets could readily manage basic functions well into the foreseeable future, redistribution for production and consumption of time based product, imposes too many burdens on revenue capacity.

Ultimately, governments become more fragile when they assume the power to assign production rights to anyone, because they cannot extract enough revenue from those with production rights, to compensate for those who don't. As too many special interests have assumed rights of production, governments are now in the odd position of demanding further revenue from those without production rights, who were often subsisting on already recycled forms of government redistribution. At some point, individuals will need the production rights which allow everyone the chance to assume maker roles. Only then will less redistribution become necessary, so that more growth can finally take place through monetary means.

Even though knowledge use systems would seek to highlight production rights for knowledge use, some production rights for tradable goods have also faced arbitrary limits in general equilibrium. Only consider the multitude of homeowner restrictions when home production appears to impede property values.  And it doesn't seem four years already, since a series of articles when homeowners faced fines and possible jail time for planting gardens in the wrong place in their yards. Indeed, as losses in production rights are increasingly taken for granted, basic income arguments become a default fallback point across ideological lines. According to Scott Sumner:
I'm starting to see a trend in the comment section that I never thought I'd live to see. Progressives write in complaining that it's cruel to have an economic system where low productivity people need to work (even with wage subsidies). Instead we should have a guaranteed annual income, so they can pursue other activities, such as hobbies or volunteer work.
Imagine receiving a "low productivity" label at a young age, and never gaining the chance to overcome it! While hobbies and volunteer work are desirable, they often do not provide the means for personal interaction with others that some imagine. Even volunteer work now requires such a high level of trust, that individuals who have been deemed "insufficiently productive" might not be chosen to assist in volunteer activity.

Granted, it requires more effort to create a future which includes work for everyone, than to simply pay off those who are not wanted or "needed". Fortunately, we have the means to return to a more normal world, which includes allowing people the full use of their own humanity on economic terms.  Should governments choose instead to leave production rights in limited quarters, representative democracy would become increasingly difficult to maintain.

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