Use Markets to Help the Marginalized (Before It's Too Late)

In a time of rising inflation and interest rates, governments have to come to terms not only with fiscal limitations, but also limits on their ability to assist the marginalized - at least through monetary means. As national budgets become ever more unwieldy, many protective roles for lower income groups might ultimately have to be set aside.

Some would argue, isn't this a positive, since governmental support often tends to cause more harm than good? It depends on whether the domestic markets of housing and services can evolve for a full range of income levels. In the meantime, consider the harsh realities faced by low income groups when it comes to living normal lives. These circumstance are largely due to environments which were put in place by public and private interests alike. As governments increasingly find their hands tied in terms of public assistance, will private sectors become more willing to live up to promises about free market potential? Or will private interests - along with the political left and right - instead pretend that economic and social freedoms are no longer possible?

Questions such as this are in need of valid answers, not vague posturing and excuses. In particular, when people struggle to maintain their financial responsibilities, they become ever more vulnerable to government overreach. It has seldom been difficult to correlate poorly functioning markets with authoritative and restrictive governments. Worse, it's as if societies have forgotten what market freedoms consist of. For one thing, inclusive markets are certainly not a matter of coercing lower prices from existing markets. Rather, market freedoms are about encouraging the design of new patterns and production systems which function alongside what already exists, but with simpler resource requirements and system inputs. Indeed, previously existing markets could in many instances just be recognized as market participants with preferences for serving higher income levels, for whatever reasons. 

When I think about production reform possibilities which have yet to see the light of day, sometimes I can't help but be angry such options never got the chance. If there had been good deflation in our domestic markets here in the U.S. we could have been better prepared for the extreme uncertainties of a transitioning global economy. In the past nine and a half years of this blog I've often highlighted people who've touched on these issues. Just the same, it's not easy to find individuals who are willing to commit to adaptive market evolution. Meanwhile I often find myself unable to tolerate the hypocrisy of left and right thinkers who always pretend someone else bears responsibility for what we've lost.

Instead of being cognizant of their own responsibility for free market evolution, many libertarians have stepped away from adaptive market patterns to take part in cultural battles. Small wonder that few really expect this to change anytime soon. Is it already too late to use markets to help the marginalized? Will libertarians stay focused on divisive rows and/or inconsequential details in the years to come? Why and how did we imagine libertarianism to have a ghost of a chance, if it was only about free markets for society's most powerful? As much as I wish for a better ending to this unfolding reality, alas, there are days I fear there might not be one. 

Experiential Markets Versus Personal Management in Healthcare

Healthcare in the U.S. is a prime example of missing markets for lower income groups. Nevertheless, more than costs are at stake, since other income groups with greater access to healthcare are still dubious about its actual value. Texas ranks highest in limited healthcare access, where in recent years the uninsured are approximately 17 to 18 percent of its population. I am among them since Medicare in the U.S. (which is gradually transitioning to private insurance) is becoming more costly and less predictable for retirees - regardless of income. However, once I retired, I started setting aside money every six months in the event of future healthcare emergencies, rather than paying Medicare premiums.

For many healthcare consumers, careful budgetary responsibility means a high level of frugality regarding any kind of professional assistance. People still believe that healthcare is important, but some of what is missing now, is a matter of regretful consumer choice. How is any of this rational? Two issues in particular stand out: What have people come to expect in terms of healthcare, and how have those expectations fallen so short of the mark? Even though much healthcare dialogue is framed in terms of costs, the very nature of personal interchange in healthcare activity is crucial as well. 

Meanwhile, many individuals increasingly take a personal management approach to healthcare, in hopes of successfully addressing whatever problems might arise. While this approach can be successful, it does has good and bad aspects. The good - of course - is increased personal responsibility for one's own health prospects. The bad? Alas, there are moments in life when it's not feasible to arrive at a clear diagnosis. Worse, there are emergency situations when we are in no position to tend to ourselves without assistance from others. Yet not all nations are fully committed to this elusive ideal of mutual assistance, or even the importance of community in general. Unfortunately, both happen to be the case in the U.S. Hence we are approaching the point where there is insufficient monetary support for healthcare's existing institutions. As the reality of this starts to sink in for healthcare professionals, perhaps they will eventually try new approaches for the preservation and use of vital knowledge - at least one can hope. 

Personal healthcare management is an unalloyed plus. For one thing, consumers and patients have far more time to dedicate to preventative maintenance than do physicians. Also, there's no "one size fits all" for decision making in applied knowledge. Each individual is unique in their personal makeup and approach. Likewise, consumers can maintain personal healthcare histories, and at the very least, AI might be able to do so in the near future. After all, AI is not subject to the same time scarcity constraints as are healthcare professionals. Also, as patients age, they tend to devote much more time to healthcare self management than is generally necessary in one's younger years. In all of this however, traditional media can feel insulting when reporters and journalists stress the dangers of self diagnosis and personal care outside the attention of professional physicians.

If only personal management were enough to take care of healthcare issues. Instead, sometimes our survival depends on the help of others, even if we cannot afford it or worse, end up belittled by the processes involved. For instance, several years ago, an ambulance crew convinced my father to ride to the hospital after a bleeding episode to make sure everything was okay, only for my father to be berated by the physician who complained his time had been wasted. Instances such as this are why people think twice about help in dangerous situations, since one seldom knows whether mutual respect is feasible. People would likely feel better about mutual assistance as taxpayer obligation, had societal skill levels not become so extremely unbalanced. There will be no institutional reform, if possibilities for mutual respect aren't somehow restored. 

Finding better balance in skills levels between individuals, means finding ways to make our time value economic in markets for time based services. How do we create mutual interdependence which is also economic in nature? I get that physicians and other healthcare providers no longer have sufficient time for their patients. In all fairness to healthcare providers, healthcare today shares similar time product scarcities with other secondary markets for applied knowledge. The biggest problem in this regard, are situations which call for mutual time based interaction, yet too few groups in society are able to effectively coordinate the skills involved. Further, additional layers of management in too many instances, cannot make up for time scarcities in crucial skills. Instead, excess management often adds needless complexities and costs, not to mention lowered ability for providers and recipients to find reciprocity in their interactions.

Without direct relationships in time based assistance, societies are losing their ability to effectively manage the demand and supply of time based product in the marketplace. These losses could explain much of society's current dissatisfaction with its existing institutions. Despite this disillusionment, getting down to specifics regarding how to move forward in common purpose, is proving to be the hardest part. Neither experts or laypeople are in a suitable position to implement institutional evolution in the 21st century. 

Though this is one time when solutions are not about "appropriate" credentials, even professionals tend to be criticized when they step out of their immediate domain of expertise. In this environment, how is it even possible for outsiders to be taken seriously? As it turns out, social media gives plenty of permissions for wide ranging complaints regarding why things go wrong, whatever that may be. What social media hasn't been willing to do, and what particularly disappoints me, is its lack of online promotion for suggestions as to how problems can be addressed. We simply can't can't afford to hide anymore from the specific hows of institutional change, despite the fact they are unbelievably difficult and frustrating to confront. For a while, I'd also become reluctant to write about how. But I can't hide my head in the sand any longer.

Wants are Sometimes a More Relevant Form of Demand

When it comes to market design for low income consumption potential, perceived needs are often a logical starting point. Certainly I've emphasized needs focused design for lower income groups over the years. But what about circumstance when consumer wants are the more relevant factor? 

It's a consideration which matters when resources are not only scarce but also include experiential characteristics. Economic time commitments are a great example. Not every individual is going to seek out the kinds of knowledge and skills from people that others might happen to deem most practical. 

However, the importance of consumer choice especially holds true for energy resource options. In particular, both consumer needs and wants will determine aggregate energy demand (not to mention supply) in coming decades. Consequently, both should be factored into market and community design, so that resource scarcities can be fully accounted for. Even though we are beginning the shift from fossil fuels to electrically generated transportation, the processes involved won't always go smoothly. No one really knows yet who will remain able to travel as frequently via electric vehicles, as was possible with gas powered vehicles. What's more, energy use patterns and their fluctuations will remain important for central bankers when it comes to inflation management and economic stability. How might potential energy consumption for low income groups contribute to greater economic stability via supply side innovation? 

Community design in the near future could address such concerns. In all of this, our routine transportation offers a straightforward example. The natural consumer preference for vehicular transportation as a special activity, could contribute to positive energy use outcomes. Most everyone, regardless of income level, prefers driving for fun (such as vacations and weekend trips) over the hassles of driving to and from work. Even though it's presently difficult to translate this reality into walkable communities for higher income levels, there's been a dearth of low income community design in recent decades. Hence the good news: these missing design elements make it easier to create new communities from scratch for lower income groups. In the process, we would be able to reduce needs based (work related) automotive transportation in favour of walkable communities. Yet low income groups could strive for energy based transportation options specifically designed for the wants of experiential travel.

At an aggregate level, community design for energy wants with reduced energy needs, leaves more room for all citizens to benefit from transportation, despite impending energy scarcities. Creating walkable communities could make it feasible to better manage overall energy demand. Walkable communities can also make it easier for low income groups to maintain more efficient control over their (already) scarce time. We are fortunate indeed that it is easy to discern what holds greater personal value, in terms of energy resources for transportation. Let's follow through on that knowing, to ensure more meaningful energy consumption for all concerned in the decades to come.

The Role of Formal Education in Cultural Divides

What makes our formal educational institutions such a problem when it comes to long term economic stability? Unfortunately, they contribute to our cultural battles by dividing people into haves and have nots, when it comes to skill sets and access to vital information. While this is obviously a problem for citizens in mature economies, these educational divides impact lesser developed nations as well. 

For instance, when emerging economies lack sufficient wealth sources to fund high level human skill, formal education can become associated with "brain drains" or possibly even the need to escape one's country to achieve success. Hence such circumstance pose a threat to many in underdeveloped countries (alas, such as Afghanistan), where knowledge based skills are not yet a dominant factor for local economic activity. Indeed, how could "nation building" ever substitute for the economic pursuits which local citizens need to generate for themselves?

In advanced economies, cultural divides play out differently. All too often, the asymmetrical financial obligations of today's human capital, can crowd more direct wealth sources. Not surprisingly, battles over who even "deserves" access to high skill human capital, lead to social instability and polarization. This lack of long term monetary sustainability for high skill human capital, is already undermining national economies regardless of their level of economic complexity. Hopefully it is not too late to embrace a wide range of valuable human capital formation which doesn't require college degrees, familial wealth, or extensive monetary compensation for that matter. I believe it is still possible to make time use an integral source of wealth in its own right. With a little luck, our formal educational institutions may eventually recognize the need for such an approach as well. 

At the very least, nations now sense that nation building is not a reasonable option. What's more, top down "solutions" leave little room for the true potential of local knowledge and skill alongside tradable sector wealth sources. In order to bridge our cultural divides, new communities are needed, where local participants can generate sustainable sources for human capital formation. Such communities could actually function as knowledge priors, since participating group time could be coordinated symmetrically. Reciprocal time value would in turn allow new wealth to be built via knowledge and skill, without need of compensation from other forms of wealth. 

The monetary flows which exist between primary and secondary markets, affect our structural economic realities in ways that aren't always easy to understood. Let's observe more closely, the nature of existing originating wealth sources. Why do they already exist, and how might they be further augmented? Applied knowledge via coordinated time could serve as a more direct form of wealth creation, so that primary markets eventually come into better balance with dependent or secondary markets. Best, more efficient patterns for human capital formation, would make it possible to address the limitations of formal education which exacerbate our cultural divides.

Is Social Mobility Not as Beneficial as Equality?

Like many - especially those of us with limited means - I believe social mobility is important for personal aspirations and economic access. Of late, the Olympics has been providing some inspiring examples. However, a recent post from Chris Dillow reminds how some on the left are quick to dismiss social mobility as a real positive. Their dislike of the societal need for social mobility, is something I've never quite understood. 

In his post, Chris Dillow presents a more nuanced perspective. He's also realistic in asserting that class issues will never be completely eradicated. For that matter, despite our occasional frustrations with meritocracy, at least it functions better than earlier aristocratic norms. Dillow sums up:

The point of all this is not to say that young working class people should not be ambitious. Instead, it is to suggest that social mobility is no substitute for genuine equality.

Perhaps more discussions along these lines would be worthwhile, especially if it could reduce our constant culture wars. It would be great if class perspectives and framing, could help reduce the excessive focus on identity politics. Nevertheless, people have different images in mind, when they conceptualize "genuine equality". For one thing, I believe that income redistribution should not be a primary focus in these matters. Even if societies could somehow wave a magic wand to reduce existing inequalities via monetary means, what would we get? Especially since our most pressing inequalities tend to involve resources which are aligned with time and space. Chances are, these are the areas we need to focus on the most.

When money is envisioned as sole solution for existing inequalities, too many intangibles and unknowns are left in the picture. How much income would ever be "enough" to pay ones basic bills, for instance? For one thing, societies are often inclined to raise prices for our most basic needs whenever local income levels rise. In other words everyone gets higher prices chasing higher incomes and we're essentially in the same position as before. 

Chances are, market solutions which lead to good deflation in non tradable sectors, might prove a more tangible and practical approach. In particular, good deflation in time based services would allow a wide range of other market prices to benefit from lower operational costs as well. Like the circumstantial nature of social mobility, market solutions could create tangible rewards that give small income levels more discretionary freedom. Supply side production reforms, much as social mobility benefits, would focus on what can be accomplished in the here and now, instead of getting lost in wishful thinking.

Production reform would be incremental and specific in nature, yet it holds considerable potential to create more positive outcomes. The long struggle to make various groups responsible for the welfare of other groups, is no longer working as well as it once did. We might accomplish much more, by creating better market opportunities for aspects of life which simply haven't responded well to income redistribution. In all of this, an important path to greater equality, is the creation of viable market options for everything we connect to specific time and place.

Let's make peace with the fact that money simply can't accomplish everyone that societies might hope for. Indeed, the sooner we make that peace, the sooner we could build markets in time value which surpass the monetary limitations of present knowledge providers. Plus, the sooner we make room for housing which is not imagined as "permanence", the less expensive it will be to maintain and reconfigure these structures once the need arises to do so. Why not build a better, more agile economy where everyone benefits from good deflation in non tradable sectors? Chances are, existing inequalities would also be eased. It's time to get started. 

Might Macroeconomic Theory Be Incomplete?

Surprisingly, given the structural changes which have taken place in recent decades, macro theory still takes a back seat to other factors in our economic debates. Even if theoretical issues are highlighted, they generally lack the depth of theoretical discussion which took place during the Great Recession. 

While this is unfortunate, perhaps it also indicates that something more is needed in terms of stories and explanations. In particular, some believe that macro theory should further evolve in order in to remain fully useful. However, mainstream economists are reluctant to advance the horizons of economic theory, indeed some have also noted that economists are the only ones with "rights" to do so. Inexplicably, this approach means economists are becoming more inclined to follow the lead of policy makers. And since the latter have become quite polarized, economist are also less inclined to agree among themselves about theoretical constructs.

In particular, the lack of attention to general equilibrium dynamics in a time of non tradable sector dominance, makes it difficult for economists to productively respond to long term fiscal budgetary burdens. For instance, excess fiscal policy means more taxation later on. Scott Sumner recently mused on what this means:

I don't think the fiscal stimulus is a good idea, but not because I expect much inflation. The inflation rate will be determined by the Fed. Rather, it's a reckless policy because it will lead to higher tax rates in the future and won't do much to generate growth beyond Q3. (Deficits do cause higher interest rates, but only slightly higher in a country like the US.)

And continued: 

For 250 years of American history politicians have held the peacetime budget deficit in check because of fears of either inflation or higher interest rates (or perhaps a loss of confidence in the gold standard). What would happen if they began to sniff out that the actual risk is not inflation or much higher interest rates next year, rather the risk is higher taxes in 20 years, after they've safely retired. How would they respond to this information? I fear that we are about to find out.

Meanwhile, many policy makers are drifting towards an MMT rationale, despite its lack of theoretical validity. Noah Smith notes the lack of academic depth in current discussions, and suggests: 

it seems fairly clear to me that the reason is that everyone quietly stopped believing in the usefulness of academic theory.

Tyler Cowen in turn responds to Noah Smith:

His whole Substack post is very good, though I give the entire matter a different interpretation. I do not view contemporary macroeconomics as wonderfully predictive, but it does put constraints on what you can advocate for or for that matter on what you can predict. I saw the Republicans go down this path some time ago, and now the Democrats are following them - it ain't pretty. I think what we are seeing now is that (some, not all) Democrat economists want Democrats to be popular, and to win, and so they will rearrange macroeconomic thinking accordingly.

Some also appear to believe that revision of macroeconomic theory is needed, so that economists might feel better about their profession. But is that really enough? I suggest that a better understanding of macro theory could provide more insight, how 20th century general equilibrium dynamics allowed nations to introduce knowledge based endeavour for citizens. Alas, this was only an introduction! As it turns out, these methods are insufficient for more complete levels of economic integration in the 21st century. Will we, can we, meet the challenge?

In short, macroeconomic theory may not prove truly useful, until it creates potential for all communities, not just the economic prospects of governments and prosperous regions. Part of getting to a better place in this regard, is understanding how no level of fiscal policy is going to address the aggregate demand realities of regions which were left behind. No economic theory is going to be complete, if it does not take today's built in supply side limitations into account. All the more so, since many future attempts to pour fiscal policy into the bottomless buckets of supply side constraints, will be doomed to fail. It's time to bring supply side considerations to what have become the general equilibrium equations of the 21st century.

Reimbursed Mutual Assistance > UBI or Guaranteed Job Programs

What if some form of universal basic income were to become a reality? Alas, should traditional employment decline in the near future, UBI is not a practical long term solution, especially given the nature of present day fiscal obligations. At most, UBI might serve as a stopgap measure, should a wide array of employment sources dry up simultaneously due to technological change. 

Chances are, UBI would also prove somewhat demoralizing, since many recipients would lose valuable opportunities for economic and social connections with others. Not only is a UBI approach likely to reduce our chances of greater economic integration, it could further polarize an already divided society - especially in terms of knowledge use and meaningful participation. 

Small communities in particular need proactive solutions for economic dynamism and long term potential, instead of compensation for basically being forgotten or left behind. Toward this end, compensation in the form of monetary reimbursement for voluntary mutual assistance, would be more practical than policy choices that don't address widespread social isolation. What's more, mutual assistance could be symmetrically aligned (via matched or reciprocal time) so as to create new wealth instead of additional demands on fiscal policy. Indeed, what could be better than creating internal rewards for our natural inclination as humans, to come together in order to get things done? 

Compensated or reimbursed mutual assistance at local levels, is also a better solution for many than guaranteed job programs. Unlike government generated work which often requires participants to relocate, compensated mutual assistance would allow local communities to create new job opportunities and workplace responsibilities in their own midst. And rather than attempting to fulfill the wants and needs of governments, the time arbitrage of mutual assistance would allow people to create entirely new local markets - markets which are responsive to shared individual wants and needs. 

Reimbursed mutual assistance contains other advantages as well. For instance, it could lead to the local creation of knowledge based services - services which otherwise tend to be difficult to access via hourly wages alone. Fortunately, the supply side approach of reimbursed mutual assistance would bring additional value to our collective time, so as to make it capable of meeting a full range of basic needs. Eventually, better coordination of time value could lead to greater community trust as well. This is especially needed in the U.S. where a substantial degree of trust has been eroded away.

New patterns of mutual assistance could lead to more voluntary and spontaneous forms of association than are now common in many time based service activities. As individual groups structure their combined efforts to build a shared continuum of activity, they gradually create new wealth which approximates what is often possible through more traditional forms of employment. In a time when advancing technology makes near future work potential less certain, people can breathe easier once viable replacements create new sources of normalcy and stability for all concerned.

Extensive Price Making is an Equilibrium Outlier

Even though many of us take extensive price making for granted in time based services, this set of circumstance is actually an equilibrium outlier among many nations. For instance, history provides ample evidence that systems of knowledge centered agglomeration which depend on other sources of wealth, can be quite fragile in the long run. All too often, when citizens can't utilize knowledge via non hierarchical means, they end up missing basic or critical steps which could help them achieve daily goals. Worse, they lack any viable patterns of participation in the institutions which bear responsibility for continued knowledge preservation. 

Since direct reciprocity has only become more difficult for services generation - especially during the 20th century - societies increasingly rely on asymmetric participation, production and consumption for a wide array of knowledge based activity. Alas, this approach has led to sectoral imbalances and accumulating debt loads. Much in the way of applied knowledge is publicly supported. However, this means that much of today's day high skill activities are financial obligations for future citizens, rather than market based production and consumption options for people who need them now. Despite the fact this set of affairs can't continue indefinitely, we still lack any Plan B which could stabilize and lessen budgetary burdens many nations face for knowledge based needs. Perhaps it's the fact no Plan B is being actively discussed, which encourages major political parties to completely ignore the possibility of imposed austerity and hardship in the near future.

A major challenge in all this, is to once again relearn how to use knowledge and skill through more directly reciprocated patterns. Not only would symmetric time use mean greater market participation for all citizens, reciprocal time matching can create more immediate wealth, thereby lessening the perceived need for governmental redistribution of all kinds. Time arbitrage is a viable Plan B which would build a more complete framework for time use potential in local community groupings. The local adaptation of production and consumption settings for knowledge, could ultimately transform communities which otherwise find themselves left out of knowledge production and consumption in urban markets.

The group time of local mutual assistance would function as a form of internalized market pricing. Since the majority of time use potential becomes accounted for in a market context, time begins to function as a valid price taking mechanism for participating groups. Likewise, being able to price take makes good deflation possible for services generation, such as extensive price taking in tradable sector activity has led to good deflation in countless forms of resource capacity.  

Consider how defined equilibrium settings can gradually restore sectoral balance by allowing participants to coordinate time more fully. Importantly, this market option makes time based services more sustainable over the long run. Meanwhile, however, the U.S. may be experiencing even more political polarization than other nations, since healthcare price making is more extensive than what generally occurs in most nations. Indeed, our healthcare organizational capacity actually makes U.S. healthcare more of an outlier, in relation to other mature economies. This extreme dependence on national support also helps to explain why it is often so difficult for both the production and consumption of healthcare in the U.S. to remain in a sustainable position, possibly even for the medium term. While price making is always an understandable urge, fortunately we can recreate market options which make room for the more sustainable practice of price taking, in the use of highly valued skill and knowledge.

Economic Integration Could Help Unify Us

After all the post election chaos, finally some relief with a change of command in Washington. Still, I know this respite could be brief, and it hardly signifies a return to normalcy. As things stand, too many budgetary issues are coming to the fore, and recent decades of structural shifts have yet to be addressed. So while Biden is a calming presence (for some of us), he's in charge of a government which is ill prepared to meet the expectations of its citizens. Unfortunately, Biden's hopes for greater unity are mostly wishful thinking - at least for now. 

For that matter - as some noted regarding the heightened inauguration security - this was no peaceful transfer of power in an ordinary sense. It may be that political unity remains out of reach, until societies become more serious about economic integration for all citizens. Importantly, what's at stake in all this, isn't about continuous cycles of additional monetary redistribution. Rather, a broader framing for market orientation is called for - one which would ultimately make less monetary redistribution necessary in the first place. 

How to think about more concise forms of economic integration? For one, such strategies would focus on the economic potential of all human capital, regardless of formal educational levels. Once a wider range of time based mutual assistance becomes horizontally aligned, skilled services would no longer be limited to urban settings and limited budgetary directives. If we can establish applied knowledge networks in communities of all kinds, aggregate time value would become a more dynamic part of our economic destinies. If we truly believe in the power of free markets, then why not give ourselves greater ability to define useful time based consumption, in line with what others hope to provide. 

More viable platforms in human potential, could increase the supply and demand of useful economic time for all citizens. Eventually, the mutual reliance of shared time would lead to greater interdependence, thereby giving people new opportunities to trust one another and become civilized again. 

Only recall how the civil societies of recent centuries, were established through a more complete representation of specific resources. Toward this end, why not make time use potential as economically viable as other forms of commodity wealth. The resource representation which our tradable sectors made possible, led to extensive societal coordination, cohesion and voluntary cooperation. Let's hope that our non tradable sectors can now take a page from these earlier positive examples. Should we refuse to put additional and unnecessary burdens on resources that are already scarce, perhaps we have a chance to reduce the "uncivil wars" of our times.

I've Been Disappointed in Myself. But What Does That Mean?

After the recent storming of our nation's Capitol, I've experienced some regret and dismay, regarding my own meager contributions toward more positive circumstances in the U.S. But I've also wondered: how could societies do a better job of preventing such calamities in the first place? It's one thing to express frustration when governments don't function well, and I believe we should. But attempts to destroy them is altogether another matter. It's certainly something I never expected to witness in my lifetime, here in my own country.  

Yet I've managed to shift from this generalized disappointment, to one more specific in nature. Why haven't I been more effective in the last 7+ years of blogging? Do seemingly lackluster results suggest I quit blogging and just call it a day? In spite of these concerns, I'd like to think the answer is no. While I'm occasionally tempted to disengage from it all, I hope to remain committed, involved, even stubborn if necessary. 

Still, it helps to remember that my main limitations are mostly age related. When I was young, I would hardly have confined myself indoors to write about supply side structural reform potential. I'd like to think that had I been aware of these issues decades earlier, my response would have included traveling across the country, while knocking on doors of those willing to listen to my ideas. At the very least, there's consolation in knowing I'm hardly alone in my age induced limitations. Many such as myself have gleaned practical tidbits of wisdom mostly in retrospect, after long slogs which occasionally included learning about life the hard way.

So how to proceed, given our most recent political impasse? For one, all citizens need a better understanding, how severe structural problems have contributed to our political reality. As a nation, we are increasingly constrained by land (place) and time scarcities which governments and inexplicably, even private citizens have yet to address. Today's fiscal policies in particular have been impacted. Unfortunately, neither Democrats or Republicans support fiscal policies which take existing land and time scarcities into consideration. Since both parties instead promote the most costly market options possible, Washington faces severe limits in its ability to function effectively for our knowledge centered economy. Is it any wonder that - due largely to lack of market integration for all income levels - both parties are now inclined to engage in mutual destruction?

Those of us who have not given up on humanity, will continue to seek means for stronger free markets and organizational systems which work well for all citizens. Granted, it won't always be easy, since there are few clear paths by which either individuals or groups can create positive change. Fortunately, there are individuals who will remain stubborn in their efforts to build a better world. Even though it's not easy for all of us to directly participate, we will stay engaged from the sidelines of our desks, while cheering on those who are willing to stay with the good fight.

Could Healthcare Providers Reduce Our Political Turmoil?

Perhaps there is a role for healthcare providers, in addressing our ever worsening political circumstance. For one thing, much of our political polarization is due to struggles between different groups for access to high skill services. Healthcare tops this list, and its present variance in job specification, is a prime example of the widening asymmetries between skills use potential for all concerned. The millions with limited skills on offer in our workplaces are finding it more difficult as time goes on, to contribute the taxes that - regardless of party - governments find necessary in a knowledge based economy. Yet the fiscal and monetary contributions of these millions are nonetheless sought, to compensate the skills of present day knowledge providers. All citizens need a chance to participate more fully, so as to maintain the viability and sustainability of coordination systems for knowledge based economies.

As societies become ever more dependent on applied knowledge for either employment potential or simply getting things done, too many find themselves limited in their ability to help themselves or assist others. How might we bring back greater employment symmetry for the skills capacity and employment potential of all citizens? Healthcare providers could be part of the answer, especially since when it comes to sought after time based services, one person's supply is another's demand. And markets for skilled time product are more scarce than they may appear, especially in communities and regions which have been left behind. 

Nevertheless, during election cycles, politicians often make promises about services generation for their constituents that they are in no position to fulfill. In the U.S. we face a constant bombardment of television ads where political candidates insist they are the ones who can best manage healthcare access. Supposedly it's all about preserving consumer demand for appropriate "in" groups, whereas if the "wrong" candidate happens to be elected, healthcare services will be reduced or even lost for one's constituents. For instance, one recently aired commercial sought to convince viewers that should the "wrong" candidate win, more rural hospitals would shut down! Seriously, could the politically "unfortunate" outcome prove responsible for that? For anyone who has closely observed healthcare realities for decades, this sort of nonsense can make one reluctant to even show up at the polls. Yet ads such as these tend to be only mildly divisive and hurtful, in contrast with other attacks.

Sometimes I wonder, what must healthcare providers think when exposed to such ridiculous goings on every two years at election time? Clearly, in many instances it is the healthcare profession which has the ability to change our supply side dilemma for services generation and the use of helpful knowledge, not pundits and politicians. This vital supply side matter should no longer be used as political fodder for division and societal turmoil. 

I continue to hope that healthcare providers will have the courage to step forward and create effective change in the years ahead. We can all do better than this as a society. It is still possible to restore hope for the future, by reaching out to one another for integrative solutions in workplace employment and collaboration with knowledge. Let's get started, and also hope there will not be further disruption and turmoil in our nation once the elections finally come to pass. For that matter, why not place the entire concept of healing into the broader societal arena where it is so desperately needed.

Economic Flourishing: Make it Personal

Struggles of identify have once again come to the fore, particularly those of race and gender. One consequence of course, is that sometimes it's difficult to turn on the news without getting depressed. Yet I'd be lying if I suggested that class or gender based discrimination have never been problems for me. All the more so, whenever difficulties in maintaining steady work meant corresponding limits in personal freedom and autonomy.

Just the same: Despite how issues of inequality and social justice are often framed by politicians, activists, and others, I believe in practical solutions for complex social problems. Specifically, a strong supply side approach for production reform, could change lives for the better in ways people get to experience, rather than having to be convinced of. Let's strive for economic flourishing on real economy terms that go well beyond what money alone can accomplish. Why not create new free markets, to supplement countless local markets which have long been restrained and will continue to be so. Fortunately, it is within our ability to make economics personal in ways which matter for all citizens, not just the elite or perhaps well to do.

Don't get me wrong! Arguments for social justice are important, and perhaps some positive change may finally come from recent struggles. Nevertheless, these discussions and activities are somewhat different, from what is needed to generate positive change at a real economy level.

In particular, economists might come to recognize supply side approaches which directly benefit all citizens. While economists have studied the economy in great detail, they mostly utilize impersonal means which are consequently lacking in real economy results. Worse, the inclination of academics and pundits to emphasize what doesn't work - such as one's ideological opponent - means too few economists who are fully vested in contributing to real economy outcomes. Sadly in all this, economics is now mostly "personal" only insofar as people are angry at economic outcomes.

Make it personal by creating more positives, instead of focusing on existing negatives. This is all the more important, since social justice hardly comes down to moving existing revenues around, or some other temporary form of "inclusion". Real economic justice means ongoing economic inclusion, in terms of what human capital potential might still accomplish. We have already seen many times over, for instance, how making more revenues available for governments, is scarcely the same thing as creating real economic access for citizens from all walks of life.

We could make economics personal in ways which help to defuse identity struggles. This is particularly possible, when we refuse to constantly demean what has come before in terms of supply side structure. The real issue isn't about dismantling special interest advantages, but of creating and cultivating new markets where special interests lack incentive to tread. It's not necessary to put non tradable sector special interests on the defensive. And if we don't, we gain more chances to create new wealth and prosperity on more personal and meaningful terms.

Only recall, how much identity struggle exists because our present equilibrium needs new and stronger definitions of wealth. We can make economics personal again, by inviting all citizens to take part in wealth creation. How might individuals share their personal definitions with others? How might others respond? Each offering can better align the ones that follow. Let's get started. Why not focus on the commonalities of what we all want and hope for? We could still break free of the chains that emphasize our differences, with the unity of a productive economic response.

Fiat Money as a Framework for Human Capital

Why hasn't fiat money turned out to be a better suited tool for complete levels of economic coordination?

Much of the problem in this regard, is that skills arbitrage emerged in the 20th century as a partial equilibrium component of human capital potential. As circular economic activity became more closely aligned with time based services generation, intangible forms of wealth created additional demands on money, which had previously had been associated with originating sources of wealth. Once fiat money expanded the range of monetary representation possibilities, sectoral imbalances became more prominent. A wide range of knowledge providers used skills arbitrage for extensive price making in markets, which gradually reduced general equilibrium revenues for additional coordination in these vital areas. Alas, this process has finally reduced the aspirations of millions who once hoped to participate in the economy on similar terms. For reasons such as this, I continue to advocate for time arbitrage as means to further promote a fuller use of knowledge and skill, for all citizens.

Nevertheless, there are fairly obvious and pragmatic reasons, why social coordination patterns for the use of knowledge emerged through such limited terms of engagement. How else might societies have readily brought together widely divergent market participants, so as to live among one another and combine revenues for common public goods? By way of example, commonalities in local real estate value made it simpler for high skill service providers to maintain integrated economic relationships, with those who were directly involved in wealth generation.

Only now is it apparent these earlier processes are not enough, to fully sustain a modern day knowledge based economy. How might we address the fact that fiat monetary systems - in and of themselves - aren't sufficient to maintain widespread integration of skills and services for all concerned? Even though skills arbitrage never was a long term solution for complete economic integration, it could still function far more effectively if time arbitrage could function alongside it, without unduly expanding what general equilibrium revenue is capable of. Time arbitrage could create a new measure of economic value which in turn would lead to more horizontally aligned workplaces. New patterns such as these could effectively disperse applied knowledge beyond what price making and skills arbitrage has achieved in a system where money is the sole determinant of economic value.

Also, time arbitrage as a horizontally aligned system, would not demand so much monetarily as to further compromise what central bankers can reasonably accomplish. Time as a valid unit of measure, could compel us to more closely examine how intangible wealth sometimes distorts monetary roles, particularly when money is expected to function as the sole source of economic value.

Time value as directly generated wealth, could allow a majority of human capital to eventually flourish. Economic time options are all the more important, now that fiat monetary systems face too many competing demands for citizens to fully take part in the economy. By allowing time to function as a more precise form of economic value, fiat systems might eventually benefit from greater economic stability, as well. Ultimately, we can have higher hopes for a brighter future, by defining wealth creation in economic terms which go beyond what money can buy.

Education: Let's Restore Local Community Threads

Much of today's formal K-12 education, takes place quite separately from the lives of local citizens. Alas, this reality adds to the financial burdens of many small communities, where local citizens support public schools through lifelong property taxes. Even though local taxation sometimes leads to impressive school buildings and well prepared students, local circles of sustainability can still be broken, when students need to go elsewhere to put their skills to good use. What of the locals who may never gain the chance to meet these young people? What does society lose, when neither local citizens or students can benefit from what either group learns in life? How can a society sustain itself for the long run, when its knowledge based institutions seek monetary support to survive, but neglect to tap a vast abundance of human capital potential, so that all might thrive?

Clearly, our time value needs to be a greater part of the wealth equation for human capital. We could work to restore valuable community connections, especially those which promote the use of knowledge and skill for markets which otherwise tend to be in short supply. Enhancing the services productivity of all citizens is important, and all communities deserve active roles in today's knowledge based economy. Fortunately, it is within our power to realign local education, so that everyone might benefit from learning processes. Already we are seeing in a time of pandemic, how many knowledge centered institutions will struggle if they depend solely on taxation and redistribution, in the foreseeable future. Why not tap into the vast pools of human capital potential which are waiting to be unleashed?

Time arbitrage, with its reciprocal patterns of wealth generation, could provide opportunities for young learners to engage with many local citizens, particularly during their high school years. With a little luck, this approach might help heal some of today's political divisions. Plus, on a practical note, time arbitrage could lead to meaningful economic interchange, in years when students especially need resources that prepare them for adult responsibilities.

The recent COVID-19 pandemic also illustrates how students might assist others in the here and now. In particular, better communication systems are needed in small communities, so that all citizens can stay informed and up to date. One would think not much time would be necessary, before students could get digital versions of (yesterday's) local newspapers up and running. Such efforts could be readily coordinated without need for advertising revenue to keep the processes going. One immediate gain from such a project, is that small communities would be able to compile statistics about the effects of COVID-19 locally. In the meantime, they often have to rely on guesstimates according to big city statistics, for their own public health management options.

Ultimately, learning processes could be coordinated with larger cities, so that small communities become able to create a broad array of healthcare provisions. One possible pandemic response, might be for healthcare providers whose work is on temporary pause, to work with local citizens and students for the creation of local testing options and other vital assistance for those affected by COVID-19. Even though this would be a short term response, it nonetheless suggests future frameworks, by which prosperous areas might reach out to areas that were already left behind, prior to the pandemic. Given the chance, smaller communities might finally be able to realign local education, toward more productive and beneficial ends.

Notes on Personal Reciprocity vs Social Reciprocity

Between keeping up with developments re COVID-19, and efforts to clarify my own perceptions in regard to reciprocity, I deleted more material in the last post than was actually kept. So today I'll try again, to explore relevant differences between (what could be considered) personal and social reciprocity.

Free markets are often described as voluntary forms of exchange. Even so, too many time based economic interactions, are not as spontaneous and voluntary as they could be. When it comes to other forms of product, prices can usually do a good job of representing and coordinating the voluntary actions of individuals and groups. It's when final product contains substantial time based and experiential components, that people face too many obstacles in what they might otherwise create or provide for one another. Money is a tremendous price and signal, but it could perform even better, if mutual time preferences could also function as prices, signals, and stores of economic value.

Many activities take place either through the personal reciprocity of individuals, or the social reciprocity of groups. While personal exchange allows individuals to negotiate for common purposes, social reciprocity seeks to build bridges and common "middle ground", as well. Since beginning this project, I've tended to focus more on personal reciprocity, than social reciprocity. However the reality is they are equally important, for they often need to function simultaneously in many social circumstance. Even as personal reciprocity creates starting points between individuals, it's the larger group context of social reciprocity which encourages a cohesive and constructive whole. In other words: When minds "think alike" in terms of aspirations and personal commitments, individual daily contributions in this context, are more likely to create circles of social sustainability.

Both social and personal reciprocity require understandable social patterns which are voluntary and not forced. People are far more likely to continue reaching out to other individuals, once it becomes obvious their efforts will generally not be in vain. What's more, societies and their institutions cannot expect immediate family members to assume too much personal reciprocity in the form of internal family roles. When this occurs, human capital potential is limited, as is also the potential of group interactions as a whole.

Plus, when individual family members have plenty of options in group settings for time based services provision, each family member stands a better chance of maintaining their personal autonomy and self respect. Indeed, family relationships tend to be more positive and supportive, so long as all family members have ample opportunity to benefit from the personal reciprocity and social reciprocity of group settings. We often observe this now in the services generation of high income communities, for instance. The more possibilities each individual holds for time arbitrage, the less the chance that everyday interactions will be of a forced nature.

How might we create reliable patterns for mutual reciprocity which are more voluntary in nature than present day institutions?  Skills arbitrage - for all its monetary value - has proven insufficient for the generation of services, knowledge, and personal autonomy which societies aspire to, particularly during times of economic uncertainty. Time arbitrage could ultimately tap into more sources of human capital, than skills arbitrage is capable of. Eventually, time arbitrage could lead to sustainable forms of services generation, which take place via common and easy to understand frameworks.

In order to function effectively, time arbitrage would include recognizable elements of both personal and social reciprocity. As to the latter, new communities could be established, where common interests could be pursued as a long term continuum for the maintenance and care of applied knowledge. Best, these new sources of human capital could rely on internal organizational patterns to generate new wealth. Indeed, one might dare hope, that when societies falter for any reason, such communities would serve as repositories of human potential, economic integration, and long term economic stability. In these settings, personal reciprocity could become the base which is strong enough for the larger goals of social reciprocity.

Mutual Reciprocity Could Alleviate Fragile Systems

One of the main issues many communities now face, is the fact that neighbors who live in close proximity to one another, lack reliable methods for mutual assistance on a regular basis. What were once common and spontaneous forms of social reciprocity, have gradually been supplanted by formal service roles. However, these more recent patterns of social and economic organization, feature "empty spots" which are exacerbated by unfortunate events such as the COVID-19 threat. Regular readers are familiar with my advocacy for time arbitrage. I remain convinced that a marketplace for time value, could help to fill empty areas where there are now few roadmaps for mutual reciprocity.

In the months ahead, attempts to control the spread of COVID-19 will doubtless add more burdens to healthcare and financial systems alike. Ultimately, societies are going to need more than centralized patterns of knowledge and skill, to bring productive agglomeration in services to areas where it is needed most. How might we build a stronger economic context, for time based services at local levels? After all, decentralized patterns for the use of applied knowledge and skill, could help restore personal autonomy to average citizens. Plus, local patterns for skilled services generation, would make it simpler for all individuals to assist one another, during all kinds of public emergencies.

Healthcare providers already struggle with the limited capacity of present day healthcare systems. The U.S. in particular, is ill prepared to fully respond to widespread health threats. For example, self quarantine might become an important strategy, since little additional hospital capacity exists if millions become seriously ill at once. It would not take much, for a pandemic to overwhelm what our present systems can realistically provide.

Another way to think about what is possible for local services coordination, is the integration of lifetime education with local strategies for applied knowledge. Only consider what could be gained, if local property taxes were redirected to support local educational efforts which augment the possibilities of informed mutual assistance. Fortunately, there are viable ways to create stronger knowledge use systems. Long term commitments to the time value of all citizens, would help address the systems fragility of our times.

Exit, Voice, and Skills Arbitrage

What benefit can we expect to gain, if we elect to exit malfunctioning economic circumstance, should it become difficult to express voice or loyalty in these environments? In a recent post, Tim Harford explains that while exit remains an option for citizens in mature economies, many feel more constrained in this regard than was once the case. Hence he asks, "What should we do when things go wrong?"

Typically, we think of exit and voice as complementary. Your complaints will be taken more seriously if you can credibly threaten to leave, as anyone who has called to cancel a mobile phone contract can attest. But sometimes exit can silence voice.

Unfortunately, as Harford also notes, one's ability to exit isn't particularly threatening to political parties, "especially not the hardliners who would rather lose than compromise." Alas, when "extremists are delighted" and "moderates quit in disgust", political paralysis is often the result.

The political nature of exit, voice, and loyalty, tends to affect the market potential of nations as well. For instance, since U.S. healthcare is such a commanding portion of GDP, one can forget these markets were constructed so as to intentionally leave market potential incomplete. Just as politicians lack concern for citizens who choose exit over voice, so too the special interests that prefer human capital requirements to restrict market capacity. Even though much of healthcare market exit is far from obvious, there's one important exception. In recent years stories have emerged regarding people in public places who are clearly in need of emergency care, yet they refuse ambulances and assistance to ensure they do not experience financial difficulties afterward.

Skills arbitrage has become one of the main mechanisms responsible for encouraging market exit. Where once people arbitraged their time for mutual assistance, some are more likely now to arbitrage skill sets in highly specific ways that require extensive human capital investment. However, the time based services markets which have resulted, are not near as efficient as one might expect. As "the best of the best" become the last ones standing in formal assistance roles, more citizens become resigned to abandoning services which they no longer have permission to actively provide for themselves or others.

Again, it also helps to consider skills arbitrage roles in the general equilibrium circumstance of national governments. Large nations in particular struggle to coordinate the skills arbitrage of knowledge providers, since only so much of any nation's wealth can be redirected towards full monetary compensation for human capital.

For purposes of general equilibrium, skills arbitrage has largely cornered value in exchange activities, at least for now. Even so, this need not prevent a reemergence of value in use healthcare in the form of time arbitrage. New organizational capacity could make it feasible for participating groups to build much needed skills, as formal value in use economic settings. Defined equilibrium options could help restore a fuller use of knowledge and skill in society. Even though skills arbitrage sometimes results in extensive market exit, time arbitrage might provide ways to ensure that citizens don't continue exiting healthcare markets - especially in moments when they need them most.

Can Economics "Raise Its Game"?

Tim Harford wonders whether economics could become more broadly relevant for populations in general, so poses some questions:

How can economics become a more insightful discipline? Should it aim to be more like physics, with its precision and predictive power? Or should economists emulate anthropologists or historians, immersing themselves in the details of the particular and unquantifiable?

Clearly, while more attention of late has been given to precise measure, both matter. Harford noted that the economist George Akerlof believes too little attention is being given to "soft" questions which aren't easy to answer on mathematical terms. That said, I respect the "hard" approach, and likely would have utilized it, had life circumstance been different. Unfortunately my interest in economic issues didn't gain traction until middle age, which proved too late to learn the (now) necessary math. Not only does math has its own intriguing qualities, it sets up Twitter economist conversational patterns which are generally beyond my comprehension. For one thing (among many), I would like to have understood in concrete terms, how dependent service sector markets (in a dominant revenue position) influence the natural interest rate.

Hence I was surprised that the late Gary Becker, as a college student (according to Harford's post), found sociology "too difficult" and consequently remained with economics studies, where he provided useful mathematical framing for specific sociological issues! Indeed, some perennial economic problems haven't responded well to a hard approach. Some examples from Harford:

What are the obstacles to social mobility? Where does innovation come from? Can we strengthen the institutions that matter for prosperity?

What also prompted today's post, was a recent Politico article which seems to speak to these concerns. Diego Zuluaga emphasized how loans supposedly meant for those with low income levels, have instead been given to higher income customers. In the process, neighborhoods gentrify as older homes in desirable areas are renovated - a process which gradually pushes out lower income levels altogether. Yet some of this isn't the fault of the banks, given their incentives. How has the Community Reinvestment Act fallen short of its intentions?

Banks are supposed to lend in low-income areas without incurring additional risk. Absent this safeguard, public policy would cause banks to make ill-advised loans, leaving taxpayers to pick up the eventual tab. Even with the statutory language, some evidence has accumulated over the years showing that the CRA does sometimes encourage risky lending. But by directing credit to higher-income "gentrifiers" in CRA-eligible areas, banks can meet the letter of the CRA without increasing the amount of likely losses on their balance sheets. 

This practice may, however, unwittingly end up accelerating the displacement of poorer residents. Consider, for example that in five tracts in D.C.'s Park View and Petworth neighborhoods, more than 80 percent of mortgage loan volume in 2017 went to borrowers earning more than the CRA threshold, even though all of these tracts have median incomes well below that threshold.

It's bad enough that so many among the marginalized end up displaced. But even worse is the fact they have so few reasonable options afterward. Where might they go, that is safe and offers reasonable hope for a good life? In particular, how can they contribute to wealth building via institutional tools for incremental ownership, instead of loans? The lack of dynamic options where those with limited resources could successfully engage with their world, is a problem crying out for a productive response. All the more so, since low income levels will be part and parcel of our economic realities for the foreseeable future. As long as improvement is framed in a "living wage" mindset, we're essentially stuck. Real wage gains depend on real economy innovations which take local consumption potential into account for community design.

Even more important: In order for economic dynamism to further evolve, the marginalized will need to work with ownership potential on terms that are well within their reach. By way of example, old housing in need of extensive remodeling is not always optimal for those with limited resource capacity, even though it is less expensive than new traditional housing. The fact gentrification has already continued apace for decades, informs us that conversations re simpler ownership options are long overdue. Further, outside investors aren't necessarily well situated to create environments where the marginalized might gain new purpose. Yet all too often, outside investors have been expected to perform this miraculous feat, even if it supports a status quo not necessarily amenable to social mobility and innovation. When ownership is deemed the social responsibility of high income levels, further economic evolution can become difficult indeed.

So how might economics raise its game? I believe it would greatly benefit from a more practical and applied approach - one that could also redress the sectoral imbalances which now impede long term growth. Both human capital and physical capital need simpler formats for ownership potential, so that wealth creation remains viable at all levels of skill and income.

And despite the relevance of math for economics as a discipline, it is still a conceptual tool which responds to broader conversations of social meaning. Said another way: Math illustrates concepts, it is not the actual concept. If economic thought is guilty of suppressing its own important conversations due to a preference for math, chances are that vital conversations are being suppressed in other areas of life as well. Likewise, some citizens now shun the value of knowledge in a society where "losers" supposedly don't even need to work with knowledge. Economics may in fact need to broaden its purpose, if for no other reason than citizens now question the hard won economic logic that has contributed to centuries of prosperity.

Centralization, Economic Freedom, and the Skills Divide

To what extent could individuals still govern themselves, in contrast with how nations tend to be envisioned as "governing ourselves"? This question has become increasingly complex and important, as societies rely more than ever on knowledge to get things done.

Self governance was a simpler option for example, when property owners could still eke out a living from a productive plot of land. Whereas much of today's production involves high levels of knowledge and skill, not to mention levels of social coordination which go well beyond familial responsibilities. In a world economy increasingly dominated by knowledge and skill, does that mean it is no longer realistic to conceive of economic freedom as meaningful choice in interaction among individuals?

Too many time based services have been unnecessarily subjected to losses of economic freedom, via forms of external organizational control which reduce the possibility of meaningful interaction. But unlike many forms of final product, time based services tend to be experiential in nature, which often suggests they could be effectively managed and negotiated by the individuals who voluntarily choose to take part. Time based product is different from the specifications of tradable sector product, in that it often assumes snowflake forms. Indeed, this particularly holds true when we are young and still actively engaged in educational processes. Without real possibilities for mutual voluntary services association, people can end up experiencing difficulties establishing healthy boundaries, mutual respect, and trust as they go through their lives.

Over time, divisions of labour for time based services have become restricted in ways which not only inhibit total factor productivity, but also limit the nature of how providers and recipients could otherwise experience the personal exchange. Put simply, externally defined divisions of labour make more sense for the precise qualities needed in tradable product, than for the experiential nature of time based services. What's more, the non tradable sector divide in skills use potential, has been perpetuated by liberals and conservatives alike.

Perhaps these implicit agreements among professionals affect economic conditions in ways not always considered. Pierre Lemieux provides some interesting context in "Lessons and Challenges in The Limits to Liberty" where he takes a closer look at James Buchanan's Limits to Liberty (1975). For instance, Lemieux noted Buchanan's support of individualism in the latter's quote "each man counts for one, and that is that", and then continues:

It follows that individual liberty is a value and that the social system should be based on unanimous consent. Any limit to liberty must thus be consented to by each and every individual.

Alas, where do we observe this presumed liberty in action, given the lack of freedom so many now experience in the use of their own time, especially in relation to the time of others? If we do not believe that a diverse range of services could be freely chosen and provided, how can we really believe in free markets in the 21st century? How much of the present fiscal budgetary dilemma is due to our governments ensuring services markets remain as unfree as possible, on behalf of the interests they protect?

Not surprisingly, it turns out there are limits to the freedoms which James Buchanan believed to be possible. For one, Lemieux emphasized how Buchanan argued in favour of government provision for public goods as a social or constitutional contract. Yet what's different in this instance, is Buchanan's reasoning for doing so. As it turns out, his beliefs regarding personal aptitude and ability also factor into his proposed economic outcomes.

In contrast to other contractarian theorists, Buchanan does not assume equality in terms of resource utilization or personal capabilities. From this it follows that some minimum of welfare state may therefore be necessary. Private and public goods both depend in part on the rules of the economic game, whereby freedom is mostly agreeing to take part in what is already proposed, or refusing to do so. It's easy to imagine that sometimes the state needs to intervene when people refuse. Doing so costs money. Hence this quote from Buchanan:

The dividing line between private and public goods depends, in part, on how the property rights of persons are defined.

The twentieth century gave rise to many domestic forms of applied knowledge protectionism, long before the tradable sector protectionism which arose more recently. Essentially, knowledge and skill has also been made rival in non tradable sector circumstance, in part because protected knowledge has to do the heavy lifting of meeting the organizational costs of quality product and costly real estate. And with the giving to special interests of these exclusive production rights, comes the rationale for a welfare state as well. Hence conservatives and progressive alike, would tend to view welfare as means to reduce public rebellion or even revolution. Indeed, I recall an instance among friends in a local welfare office decades earlier, where local progressives expressed the rationale of public assistance exactly in these terms.

Again, Buchanan is hardly alone in assuming relatively permanent differences in aptitude and human potential at the outset. After all, many progressive arguments for government job guarantees or some form of "living" wage, contain the same underlying assumptions regarding how workplace conditions and skills requirements "should" consequently be defined. Nevertheless these assumptions blatantly disregard the potential for mutual reciprocity and well being, when societies allow as many as possible to pursue full engagement and meaningful interaction.

A limited welfare state is desirable for societies to protect the old and the weak. That said, there are millions who actively resist remaining weak. Some of the latter I might either respect or fear. But I don't find welfare states acceptable on the rationale of keeping out those who could potentially thrive but presumed too dumb or weak for society to allow to take part. Social and economic exclusion is not going to work in a knowledge based economy, especially when many forms of production and former employment are tended to by technology and automation. Let's don't create permanent skills divides between groups. That's a recipe for disaster. Doing so would not only prevent millions from assisting one another, but also incline some among these groups to rebel in a thousand ways that no government can prevent.

Update on a Busy Writing Schedule

Regular readers have probably noticed I've not had much time for blogging recently. However it's mostly due to a good reason: I'm in the process of finalizing material, for the first book of a series which will also eventually become part of the blog sidebar. This past August, I'd begun settling into a schedule of wrapping up chapter material each month, before continuing to the next chapter. Of course as it turned out, the third chapter ran three weeks longer than expected - given my self imposed deadline! Hopefully that won't happen too often, so I'll still have time for blogging, and particularly so the initial part of this extended writing project will be complete (finally!) by summer's end of 2019.

There'll be eight chapters in the first book and they should be ready for their last edit (prior to this initial publication) by late spring. Once Time as Wealth is complete, I'll be able to set my sights on some pressing macroeconomic concerns which are the main focus for the second book. Afterward, the third book will describe a potential institution which - alongside for profit endeavour (physical building and infrastructure components) - would support a time/generational continuum for mutual employment and knowledge preservation. In particular, an institutional structure is needed which can address the widespread structural dilemma which is also a result of the Baumol effect. Meanwhile, here's a few highlights from Time as Wealth.

1) The Untapped Potential of Time Value
Many discussions re time as wealth, understandably focus on the reality of personal time scarcities in relation to institutions which already exist. But what if it were possible to position our economic time value within a context of institutional adaptation? Importantly, a marketplace for time value, would mean greater monetary equivalence for all time use potential. This approach would help compensate for the fact nominal wages may be slow to adjust upward, during historical periods of service sector dominance. Indeed: The tradable sector dominance of our recent past, was likely a greater contributor to relative income equality than is generally recognized. That relative loss in tradable sector output - hence relative wage loss - is a recipe for political fragility. Gains in aggregate time value could  help restore a rising standard of living, and bring a new dimension to productivity as well.

2) Imagine and Create the Markets We Want
How might a well defined marketplace for time value, actually benefit society? For one, there is a growing zero sum mentality in the political arena, which has been exacerbated by the exclusivity and polarization of today's non tradable sectors. By taking all time use potential into account, more inclusive and less polarized workplaces would eventually take shape. What makes greater inclusion feasible, is that mutual reciprocity creates wealth at the outset, instead of having to demand resource capacity from elsewhere. Reciprocal wealth building, means new economic options that go well beyond the skills exclusivity of many present day workplaces.

3) From Skills Arbitrage to Time Arbitrage
Is it possible to differentiate how we value the overall use of our time, from how we came to define the value of skills investments in 20th century workplaces? All too often, the commitments of our skills priorities have meant giving short shrift to other time priorities and responsibilities. In some respects, time arbitrage could prove a more flexible means of services coordination, than skills arbitrage. Time arbitrage could tap the use of knowledge in non rival ways which help to preserve the spread of knowledge throughout society. Not only could time arbitrage restore our capacity to manage the time necessary for personal commitments, it could allow local groups to coordinate a broader range of skill sets than is presently possible.

4) Autonomy, Personal Agency and Economic Freedom
Governments and private industry alike, have long been complicit in mutual agreements which reduce our economic freedoms. How can a society expect to preserve political freedom, without economic freedom? Nevertheless, the freedom to produce is not as prominent among supporters of free markets as one might expect. Much of the usurpation of knowledge production rights in particular, took place well before wealth came to be strongly associated with knowledge. Indeed, the dialogue of victimization likely emerged in part due to a lack of understanding, how production rights have slowly but surely been lost. Production rights are an important part of our potential happiness and satisfaction in life, in that they make autonomy and personal agency a viable option for society as a whole.

5) From Divisions of Labour to Mutual Time Priorities
Not only do we need to closely examine future possibilities for time management, we also need to take a broader perspective regarding the rationality of mutually held time commitments. While tradable sector activity continued to dominate, time management was often a secondary concern, given the obvious demands of these kinds of organizational activity. However, non tradable sector organization has not been near as efficient, or as complete in terms of production potential. Possibly the best way to think about regaining efficiency for time based services product, is to envision the process as one of mutual employment for mutually held time priorities.

6) A Place in the Sun for Students of Life
How did our personal enjoyment of experiential and practical knowledge, become so lost in the demands of formal education? If that weren't enough: Formalized education has made it exceedingly difficult for average citizens without college degrees, to participate in some of the most important issues of our times. It is said we need to vote if we want a good societal outcome. Nevertheless, there's little in the political area which actually addresses the most pressing issues of the day. And many vital issues - instead of being worked out at a societal level - are inexplicably "roped off" for educational papers and high level discussions. Let's create more meaningful roles which include economic context, for students of life with an avid interest in lifelong learning, yet little means by which to share that passion in productive ways with others.

7) Building a Continuum for Knowledge Preservation
Even though generational wisdom may appear irrelevant or outdated, there is hidden fragility in the systems of our times. Knowledge tends to utilized in ways which don't necessarily carry a reliable continuum or momentum. Important information may actually be lost at times, in part due to how its use is organizationally structured. How might societies reduce this risk? An important aspect of this conundrum, is a wall of separation between schools and workplaces which prevent students from taking active roles in the economic and civic lives of their communities. Even though social and economic mobility will always be important, more communities need the economic option of being able to play direct roles in the knowledge preservation and utilization processes they have supported for so long, via formal education.

8) An Overview for a New Institutional Role
A new institution is needed, which can productively respond to the fact that time value scales differently from other forms of value. Time based product is vitally important in multiple aspects of our lives, especially since it contains an experiential nature which cannot be replicated in any other way. Nevertheless, the only way to make time based product truly efficient, is to provide an economic dimension in which time can directly function in relation to itself. Knowledge and human value would be able to scale up in this arrangement, so as to compensate for the fact this system wouldn't directly capture full monetary representation. Participants would generate the monetary equivalence of real wage value, through their creation of service options which otherwise would not be possible.

There's another important aspect of monetary equivalence in this arrangement. Each participant would build lifetime ownership in both local building components and physical infrastructure, and have ownership options as well in the manufacture of these components which are sold globally. This active citizen shareholding position, would make it possible for central banks to indirectly represent the labour of these groups (which otherwise couldn't function as a liquid asset), via their share of ownership in the for profit role of the equilibrium corporation.