Monday, September 4, 2017

More Thoughts on Organizational Structure

In a recent post, I gave some explanations why an equilibrium corporate structure would function best as a for profit institution. For that matter, turning time value into wealth, deserves to be closely associated with for profit activity. Also, why do we need time arbitrage as a production means which could eventually lessen the need for debt accumulation? And might it be appropriate for some activities associated with this institution, to function in a not for profit capacity?

Consider that debt has become too important in the maintenance of consumption roles, instead of capital formation. Societies become fragile, whenever debt becomes expected as a matter of course for basic economic access. However: Since traditional capital no longer provides sufficient societal revenue, human capital now needs to assume a larger role for economic functions, alongside that of traditional capital.

Given the right circumstance, debt formation - for centuries at a time - has proven capable of contributing to, and augmenting wealth. Nevertheless, debt is most capable of doing so, when it is primarily utilized to generate additional output. The danger is when too much debt formation occurs in the limited output roles of non tradable sector activity, as opposed to the traditional wealth creation of tradable sector activity.

The basic problem for debt formation, is when it crystallizes a level of societal expectation which progressively becomes more difficult for all participants to reach. Many people now need the option of utilizing the time they actually have at their disposal, to tend to the production and consumption needs which have been too inefficiently allocated by today's non tradable sectors.

Time arbitrage could make it possible to realize productive gains in human capital, without the extensive risks which are now associated with human capital investment. More of today's knowledge based work needs to be opened up to society as a whole, even though substantial portions of these efforts would not receive "full" monetary compensation.

There's good reasons why the United States was once open to all comers. Many individuals could augment and improve resource capacity, with scarce any need to resort to debt formation, to do so. What people were able to create through the time at their disposal, could readily be shared with others. Immigrants left hardened class structures behind, when they no longer had to resort to debt to build a good life. If debt is left in place as the only means to succeed, where would anyone go today, to begin anew? Why has this connection between debt expectations and hardened class structures not been emphasized more extensively?

Debt is no substitute for economic time value. If growing class divisions are to be overcome, human capital will need to be strengthened, so that it functions well not just in prosperous regions, but in many other parts of the world as well.

Again, would the equilibrium corporation benefit from non profit activity to assist this process? Two elements are possible. First,"centralization" is only useful insofar as it brings together a full range of efforts for new community formation, to illustrate to others what works, and what may not work. Each group and area would have its own unique characteristics, and what is needed most are template possibilities for both social and physical infrastructure.

Another area of possibility is sponsored assistance for individuals and groups which may have either limited exposure to the workplace, or workplace experience that is no longer recent. Often, these individuals may require additional help in their efforts to learn how to generate mutual employment with others. They may understandably be reluctant at first to purchase the time value of others, via their own time value. On the other hand, individuals who come to the process who already have additional resources, are more likely to be able to start the process in ways which would not require outside monetary assistance, to build local communities which can eventually sustain their own local services needs.

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