economics

Hustle

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Opportunity Profits

In the Thousand Precise Protocols of the Integral Accountant, opportunity profits are defined as effectively the opposite of opportunity costs,

Opportunity costs represent the potential value one misses out upon when choosing one alternative over another. Because opportunity costs are, by definition, unseen, they can be easily overlooked. Understanding the potential missed opportunities when one chooses one path, or one investment, over another allows for better decision-making.

Opportunity profits, therefore, represent the value one gains from choosing and acting upon an alternative, which, implicitly, other people have thus far chosen not to pursue. For example, an odocorp which constructs a bridge over a river reaps, in addition to the profits deriving directly from the construction and operation of the structure, but also an opportunity profit; their legitimate reward for having demonstrated foresight in seeing the need, willingness to accept the risks involved in the investment, and the boldness to seize the opportunity.

Perhaps the most famous example of opportunity profits (other than the Empire’s major odocorps) would be those of Ring Dynamics, ICC, whose seizure of the opportunity of the moment to parlay their development of stargate technology into a long-lasting dominance of interstellar transport is, if you will pardon the expression, textbook; although this also provides an example of a lost opportunity profit, since the Laserider Network lost its investment in the deep space lasers rendered obsolete by the advent of the stargates.

– from an introductory Imperial economics textbook, circa 3000

Following The Money

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From: Toríno Lanada (Economic Attaché [Vonis Prime Mission], Diplomatic Attachment WG, Active Operations PWG, Second Directorate)
Memeweave: All-Seeing Eye/Voniensa Republic/General
Cc: Intentions Analysis PWG
Subject: Shell colony economic anomaly
Authenticity: 4E11; SENDER, RELAY (4/4), RECIPIENT
Security: EYES ONLY ORANGE ICE SHADOW
Distribution: Executive & Analysts
Date: 7142 Yrnaes 11, Studious falling 14

Be advised that as of this date we have identified and confirmed a number of anomalies in the financial reports submitted by a large number, approximately 20%, of the Republic’s Shell colonies to the Central Financial Group. Such anomalies (detailed documentation to follow by non-expendable communications) vary significantly in detail, but serve the identical function of minimizing the apparent economic product of the colonial economies in reports used by the Central Financial Group to determine the remittances due to the central governance.

This practice appears to have been adopted in the wake of the Council of the Republic’s decision to increase remittances (to a demand of 30% of economic product) to restore cuts made to Core system distributions, these cuts in turn having been made in order to fund the Fleet rebuilding programs called for after the Core War. Such restorations were necessitated by increasing social instability on several of the Republic’s most heavily populated Core systems, including Vonis Prime itself.

In light of the increasingly fragile state of the Republican economy and the increasing divisions now manifest between the Core systems and the Shell, I request greater resources be allocated to determining specific expected fracture points and shock vectors therefrom resulting, as well as additional asset allocations to prominent Shell colonies identified in the detailed documentation if Intentions Analysis concurs that these are high-probability event whenwheres.

– Lanada, ExSec

Infrared Emission, Too

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warmbody: a career that exists in certain “economically quirky” parts of the emerging markets, the warmbody – also sometimes known by the unusual sobriquet “rent-a-squishie” – reflecting an unwillingness to accept the realities of industrial magic and need to preserve “traditional” employment at all costs.

From the corporate perspective, warmbodies serve to pad payrolls, generate the appearance of activity, and most importantly, are living permission slips to do business in polities in the grip of labor-cults.

The actual functions of the warmbody vary widely in accordance with the nexus of corporate policy, regulatory environment, and individual characters involved. At its best, it can function as a form of subsidized training, preparing people for meaningful careers elsewhere in the business, or working as independent associates.

At its worst, by contrast, it constitutes an elaborate shell game in which corporate pretends extremely hard that its workforce is doing something of use – and are not being kept carefully away from anything that might impinge on actual operations – while said workforce hopefully pretends not to notice.

(These arrangements rarely last for long in those circumstances in which they’re unwilling to go along with the pretence.)

But for the most part, it just works out to be a Universal Tedium, in which boredom is inefficiently exchanged for resources. Since it is usually considered important that the public not be aware of the nature of such arrangements, warmbodies do acquire a skillset of some note in fields such as paper-shuffling, beverage-fetching, wall-propping, stealth gaming, and the tactical deployment of bullshit – applicable across a wide range of industries.

– A Star Traveler’s Dictionary

On Preextant Properties

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Little more need be said on the matter of thoughts and chattelry; in truth, the Word is the thing and the whole of the thing:

All the works of your hands:
Stone and metal, wood and water, fire and wind.
All that your will creates.
These things are forged in your Flame;
That which you create is yours.

The Word of the Flame, Truths : 9

This is sufficient for ideas alone, or for the works of the artisan, the crops of the farmer, and the wares of the merchant.

But what of properties which had already existed in their components, such as volumes of land, including within them the passing airs and the still waters? Or what of the initial claim upon the fruits of stone, the development of which inevitably removes them from their source?

Before we consider Arlannath’s answer to this, the postulate of indisseverability, we will first describe these properties in a state of nature. That is, we shall discuss the ore lying hidden within the earth, the path unwalked, the land unimproved, and so forth.

The consensus of our philosophers is that such things are simply unowned, and belong to none. Challenges were raised to this position in the past, by such philosophers as Milentios of Inisvaen, Lanqin of Sar Andael, or Moréteyr of Ildathach, asserting rather that such things are jointly owned by all. This view has largely been repudiated as korásan arrogance, for who can rightly claim even partial title to an infinity of whose nature – indeed, of whose existence – he is largely unaware, over which he can assert no dominion, and to which he has committed no binding act? Moreover, such theories cavil at the conclusion that if all such things are jointly owned, they are jointly owned by all thinking beings, those dwelling around the farthest star as much as by those nearby who might have an interest, leading inevitably to the inability for anyone to set their hand to the smallest pebble without the consent of all unbounded creation.

Thus to Arlannath and indisseverability. This postulate arises from the simple observation that a creation cannot be separated from its prerequisites. That which exists must necessarily exist in a place; that which is made must be made of something. One cannot build a house without building its foundation upon land; nor can one mine and bring to market copper without removing copper ore from beneath the earth. The one is indisseverable from the other. In the absence of any barrier to the use or acquisition of the unowned – for the benefit of any individual or group which seeks to use it in an act of creation – resting upon prior title, this indisseverability necessarily implies that an act of creation from the unowned, a binding act, confers proper title to that which is created and that which exists to support it. Such binding acts are the basis for all homesteading, roadsteading, minesteading, commonsteading, and other mechanisms by which the wild unowned is brought within the aegis of civilization.

Arlannath did observe, nonetheless, that such acts of creation incurred a hypothetical opportunity cost, insofar as such a binding act necessarily diminishes the unowned. This matter, in his day and for generations thereafter, was considered a self-resolving trifle, since the lands of Eliéra were wide and little-peopled, and under such circumstances the advantage to the community near, far, and yonder of the improvement of land and availability of resources presented an opportunity profit to all believed to far outweigh that opportunity cost.

(The larger opportunity profit redounding to the appropriator is merely the proper reward for foresight and entrepreneurship. Anyone can seize an opportunity, but the rewards rightfully go to those who do.)

Philosophers and economists of later millennia have had occasion to consider this matter in more detail as time has passed, reaching its culmination in Períne Cyprium-ith-Elethandrion’s seminal publication On Externality and Incorporation. The original-appropriation and resource-extraction surcharges applied by the Protectorate of Balance, Externality, and the Commons, discussed in the next chapter, are the legacy of his work.

– from an introductory Imperial economics textbook, circa 3000

A Cure As Epidemic

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A shadow fell over the city.

That was, of course, perfectly normal. It was fourteen minutes before the Wakening hour, and four million people’s deliveries were here, packed into a vast warehouse wrapped in an inconceivable volume of vacuum, wrapped in turn in shimmering white fabric bearing the moé winged parcel and hexrunic letters proclaiming its name and ownership for all to see.

Desire Causes Satisfaction, the All Good Things, ICC fulfilment zeppelin, had arrived on its morning rounds.

Perhaps the dark cloud cascading from its vomitories, dense enough to deepen the shadow to true shade to fight in¹ rather than a dissipating gray wisp, was unusual but it was no matter for concern. This was the Empire, such airships did not fail, and the people below could go about their business assured that whatever had caused this alteration of normal routine would become apparent in due course.

From Rectifier Gaelin Septimiel-ith-Septimiel to Citizen-Shareholder Eimil Isilviere-ith-Inviere, greetings.

In response to the ongoing Level 3 (Epidemic) Contagious Disease Warning posted for the Greater Cestia & Proximal regions as of 2049 Cálith 20, the Emergency Management Authority is pleased to provide all citizen-shareholders, citizen-intendants, and metic residents within the affected region and other strongly connected regions a dose of the vaccine to cytomegalovirus VVAR-1472-B and related strains developed under the aegis of the Office of Disease and Toxin Control, Prevention, and Elimination.

For further details of the vaccine and its development process, please see here. Should it prove the case that the information you desire is not available via this link, please contact the office of the Procurator of Transparency.

The provided dose has been packaged in a self-refrigerating autoinjector coded for individual use, which can be operated by pressing the uncapped tip against the body over a muscle mass; an upper arm is recommended.

Should the vaccine payload have exceeded the permitted temperature range, expired, or otherwise degraded, the blue status light on the autoinjector will have turned red and the autoinjector will not function. In this case, please contact the nearest Imperial Services office for a replacement.

Please wait five days for vaccine to take full effect before discontinuing high-level infection control precautions. We request that low-level infection control precautions be continued until the epidemic disease warning is rescinded as a courtesy to your fellow citizen-shareholders.

The contribution to population immunity provided by individual vaccination has been assessed as a positive externality valued at Es. 192.41 by the Protectorate of Balance, Externality, and the Commons. As such, this will be credited to your Active Credit Account upon verified autoinjector operation.

The Empire thanks you for your cooperation and forbearance in these troubled times.

Given under my hand and seal this day 2049 Telenith 9,

Gaelin Septimiel-ith-Septimiel
by appointment to the situation, rectifier
Emergency Management Authority

  1. This somewhat anachronic definition of “shade to fight in” gained currency late in the Consolidation, when Imperial forces were clashing with those of the Alliance over mining and energy production facilities on tide-locked Eurymir and during the long day on Toramir, the innermost planets of the Lumenna system. On such battlefields as the Plains of Glass, one has the choice of fighting in the shade, or of being boiled to death before ever engaging the enemy.

Money, Money, Money

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A longer-than-fits-in-the-margin response to a comment on the last post:

How do you make money, the symbol of exchange-value, properly match the actuality of exchange-value?

Have a fully backed currency (eg gold) and do really nasty things to anyone who so much as thinks of the possibility of maybe theoretically devaluing (read: cheating) it.

Not only no, but hell no.

What is a currency? Well, it’s a medium of exchange, a unit of account, and a store of value, each of which has its own requirements. To function as a reliable store of value requires, inter alia, that its value remain stable across time.

This has generally proven problematic for both fiat and commodity (i.e., including “backed”) currencies. But first, let’s look at what that definition actually means. A single unit of currency is nominally a quantum of exchange-value, representing 1/[money supply]th of total exchange-value. So what’s total exchange-value?

Answer: total exchange-value is the production of the entire economy denominated in that currency; all the goods and services which people are willing to trade for using it.

To be a reliable store of value implies that what yesterday’s unit exchanged for today’s unit will also exchange for, and that tomorrow’s unit will exchange for what today’s unit exchanges for. To make this happen, ceteris paribus, the money supply must precisely track total exchange-value.

(There are obvious complications in accounting for this, inasmuch as it should, for example, avoid changing the value of money due to secular expansion and contraction of the economy, but should not attempt to compensate for, for example, decreases in prices due to, say, increased resource availability or improvements in total factor productivity. Which is to say, you have to carefully separate authentic shifts in value from those which are merely caused by your own scarcity mismatching. But let us assume away these complications for now.)

This is problematic for fiat currencies partly because figuring out total exchange-value is a hard problem (we do it, for example, mostly by looking at long-term price changes after the fact and applying a bugger factor by eyeball), but mostly because governments find it very hard to resist the urge to screw around with monetary policy. And inflation is awfully convenient if you get to keep the seigniorage, since it essentially functions as a stealth asset tax.

Aurifer was built to solve the former problem; the latter one? Well, that one is hard unless you happen to have people who really, really love money to put in charge and prevent it from being debased.

This is really problematic for commodity currencies, though, because you can’t control the money supply at all. What you have is what you get, and the value of your currency wanders all over the map just like the price of every other commodity. As Robert Houghton mentioned in the previous post’s comments, the experience of the Spanish post-Mesoamerican conquest is instructive, as their gold-glut-driven hyperinflation is the perfect go-to example for “but though we had plenty of money, there was nothing our money could buy”.

Which is to say: properly-managed fiat (which isn’t really fiat at all, because it is backed by something, just something abstract – which is what really backs all currencies, in the end – but I digress) may not be the best game in town for a reliable store of value, it’s just the only game in town.

Electronic currencies can be messed with, and the only reason the Eldraeverse gets away with it is because the guys obsessed with things like the rule of law, property rights and such also just so happen to be the top dog.

Technically, the Empire gets away with it because they just so happen to have the aforementioned money-lovers and a friendly fiscal god, not to mention the real check-and-balance, a free market in currencies rather than a de jure or de facto state monopoly.

The rest of the Worlds may, and indeed does, vary.

(We shall avoid making jokes about the volatility of the one mercury-based currency out there, or the stability of those based on (radioactive) power metals.

But we shall take a moment to note that the ergcred goes into crisis with every new power-plant megastructure that comes on line, the Bantral labor-hour [back when the People’s State was a going concern] traded externally for rather less than Chthonic Railway tokens, the linobir bloodnote’s worth depends on which clan issued it and what they’ve killed recently – as is its physical makeup, more often than not – the gAu’s value is inversely proportional to distance from the Core Markets, and the Kameqan thal is worth EXACTLY WHAT LORD BLACKFALL SAYS IT IS.)

IRL, gold will probably do just fine if the population keeps growing to keep pace (roughly) with the amount of gold out there (don’t forget, hardly anything reacts with / corrodes it). The Eldraeverse is often just a tad more utopian however.

Though mind you, the energy cost of stripping a planet / solar system / whatever of all its gold is going to be pretty high, perhaps even to the point where it’s not cost-effective to do so. The highest figure I’ve seen for gold on Earth is ~2.5 million tonnes (the lower figures are under 10% of that however), discounting the estimated 20mt in ocean water (GLHF filtering all that though)… combine that with the likelihood of finding much gold in asteroids (probably low, assuming denser asteroids tend to form / hit planets earlier than lighter ones), and there may not be THAT much [insert rare metal here] available.

This turns out not to be the case.

The best estimates I’ve seen for mined gold through all human history is on the order of 180,000 tonnes, with the USGS estimating that there’s maybe 50,000 more to mine, with some awaiting discovery on top of that. Not counting currently unexploitable sources like ocean water or mining the planetary core.

Let’s look at one particular example right here in our solar system: 16 Psyche. That particular asteroid is a nickel-iron metallic (i.e., probably chunk of the core of a protoplanet), and as such is much higher grade ore for both iron and all the other metals amalgamated into it than anything that exists on Earth now, and probably ever. It’s also about 120 miles across.

The iron alone is worth about $10 quintillion, before we even start looking at the gold and other precious metals. Ain’t no population can fuck fast enough to keep pace with that.

(On one hand, I might be stacking the deck a little since 16 Psyche is by far the biggest metallic asteroid out there. On the other hand, it’s a quintillion-dollar motherlode of the kind of ore that makes smelters do the dance of joy that is sitting right there, right now, just waiting to ruin incautious commodity traders’ whole decade, and there’s no point in pretending it ain’t.)

tl;dr When I wrote that the Age of Space was accompanied by the price of gold dropping to around where the price of iron used to be, and the price of iron zeroed out, I wasn’t just pulling numbers out of my ass.

(In-‘verse, when they want to drive this point home to people from peripheral worlds, they take them to see Celestial Mechanics, ICC’s main gravity tractor. The one that uses about 10% of Earth’s entire historical gold production – or a little over twice the total US gold reserves – neatly divided into kiloton slugs, as ballast.

This is assuming they didn’t get the point when some scruffy free trader filled his hold with exotic native handicrafts in exchange for the spare set of trimming weights that’d been slopping around the ship’s locker since ever, for a cool 10,000% profit margin.)

Fully backed (and crypto-) currencies are also nice in that nobody has central control over them when it comes to policies like printing money. Oh sure, you could have built up a secret stash of gold/BTC/etc, but that’s not nearly as easy as typing a few numbers into a computer to create new money. Plus, someone might (a) realise this, and factor your secret stash into the market prices, (b) steal it, or (c) destroy it (insert Bond reference here ).

That same quality, though, makes them lousy stores of value, because without the ability to match the money supply to the total exchange-value, you end up with either inflation, or deflation, or worse, both. Cryp has its virtues in terms of fiscal stealth, and as an investment, but it sucks as currency, because it fails one of the major purposes of the stuff.

Finally, stuff like gold has the handy trait of working at much simpler tech levels, for want of a better phrase. If that Carrington Event fries an eldrae colony’s electronics and they’re out of touch for a year (I’m sure they have fancy solutions, but it’s the principle not the specifics I’m concerned with), gold will still work just fine.

The solution is called “use the coinage as coinage without verifying it for the moment”. It’s not like the Empire wasn’t using gold, etc., coinage for centuries before anyone invented practical electricity.

But they were also aware that what gave that currency its value wasn’t the metal, it was the little engraving saying “By Our Imperial Word, One Esteyn”. Now that’s a promise you can take to the bank.

But it turns out that creating a liminal hyperintelligence that indwells your currency such that it can regulate its own value from a fiscally omniscient perspective works modestly well

I’m just a bit dubious about how this might work across anything more than planetary distances. Surely lightspeed lag would cause problems if this currency is seeing a lot of use? “Fiscally omniscient” sounds iffy to me.

There is FTL communication available, note (see “tangle channels”), but the important thing to make this work is that the instance-syncing can keep up with the speed of economic transactions. Where there’s light-lag, Aurifer’s instances updating each other is slower, but so is transaction clearing, so it can still keep up.

Trope-a-Day: Real Money Trade

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Real Money Trade: The problem is that it’s hard to define what qualifies as “real money” versus “game money” when the Mythic Stars MMO alone has an internal economy bigger than some respectably-sized planets.

The logical consequences of this apply in full, including the follow-up to the city guards dragging your character in for stealing someone’s gold (if done outwith the parameters of the game by cheating means, etc. – obviously game theft is fair, um, game) being the game looking up your physical identity and having the local constabulary drag you off for an unsympathetic judge to explain grand theft to you in a prolonged and inconvenient manner.

Gold farming is SRS BZNS.

Snippet: Non-Identical Values

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“The greatest and most misleading heresy of my field is the conflation of value with exchange-value.”

– Academician Teidal Ellestrion,
Economist Excellence,
Imperius Professor of Fiscal Econometrics (Commercial University of Seranth),
Director of the High Guild of Coin and Credit,
Aurarch Emeritus of Éävalle

 

Question: Good Economics

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Out of curiosity, what would be the eldraeic critique of the idea of “Good Economics” as expounded on in the Book of Life, particularly as contrasted with Classical Economics?

(http://www.thebookoflife.org/good-vs-classical-economics/)

It’s a category error, plain and simple. Ironically, a lot of the things they complain about are examples of the exact same category error.

Economics, saith the Academician, is a science. It is to the laws governing utility, value, and exchange-value as physics is to the laws governing gravity, electromagnetism, color, and flavor. It’s a purely descriptive discipline, which is eo ipso amoral, in the same way that while how you use electricity or gravity may involve ethical choices, neither Newton’s nor Faraday’s laws have any ethical significance per se. Is, not ought.

What they’re talking about, with regard to making judgments of worth and dignity and so forth, with regard to what people want, what people want to want, what people ought to want, and what people ought to want, is the province of various other fields, like ethics, and aesthetics, with a side order of culture and religion, and whole bunch of bare-assed personal preferences on the side… exactly none of which goal-driven behaviors are economics, any more than all the ways sophonts have found to move mass and charge around to useful ends are physics, because neither of them talk about goals. They’re about how, not about what.

…and the irony is that when they talk like this:

“But if next year, the wrestling society spends a record 11 billion, it is cause for praise: demand is growing, which is always good, irrespective of what it is actually demand for.”

“Work is regarded only with respect to its financial status.”

“Profit is, too, assessed only in terms of quantity. So long as one stays within the law, classical economics is neutral on the issue of how it is produced. To make profit from running a casino is no more or less admirable, no better or worse, than to make it by designing and constructing  beautiful streets of small houses.”

“The classical view is neutral about GDP. A society as a whole is assumed to be doing well so long as GDP is growing irrespective of the kinds of activity that lead this to happen. People might be working endless hours, the beauty of the countryside might be despoiled, but all that counts is whether the financial numbers are going up; anything else is irrelevant.“

…this is the same category error ascribed to the “classical” side, in which people are assigning ethical and aesthetic qualities to phenomena which no more have them than gravity does. To say that increased demand for X or the greater profitability of Y is good or bad or better or worse in an ethical or aesthetic sense (vis-à-vis a limited utilitarian sense) is the same kind of damn nonsense as saying “more things falling down is (morally) better”.

(Of course, we have the whole mess called normative economics, which an Imperial economist would consider nonsense on stilts.

To such extent as it is merely a discussion of what one ought to want, it isn’t economics, as above. To such extent as it isn’t, it makes about as much sense as writing down your idea for how gravity ought to work and expecting results. You don’t get to have normative views on natural laws unless you’re in the reality-construction business, and if anything, the laws of economics are probably less tractable than those of physics that way.)

 

A Weapon Too Terrible To Use

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CONFIDENTIAL (RED) / EYES ONLY GLITTER TARNISH
EXCHEQUER INTERNAL

Welcome, operative of the Imperial Exchequer.

If you are reading this document, it is because you either have need to know for, or have independently discovered, the weaponizability of the currency validation system.

To recap: the modern esteyn possesses full verifiability against counterfeiting, since every individual currency unit possesses an embedded cryptographic signature incorporating its denomination and serial code. This applies to both physical currency, in which this signature is embedded in v-tag format, and to money of account; an esteyn-denominated account must record not only the quantity of money contained therein, but the unique cryptographic signatures of each esteyn-unit stored. In either case, such units can be verified as genuine by an authentication exchange conducted across the Imperial Banking & Credit Weave.

We retain the ability to generate new cryptographic signatures and to invalidate old signatures at will. This latter facility is used principally by the Office of the Mint when replacing worn-out, damaged, or lost physical currency, and by the Office of Currency and Values, when adjusting the total money supply (i.e., to draw down the money supply, the OCV invalidates the signatures of selected esteyn-units presently in the general account of the Exchequer).

The realization you may have come to is simply that we do not require possession of a group of esteyn-units in order to invalidate their signatures; we merely require their serial codes. As such, we can invalidate any quantity of esteyn, anywhere in the galaxy “by remote control” – revoking its status as legal tender and a store of value, and rendering it useless in transactions anywhere in the legitimate economy.

This capability has never been used.

It is conceivable that one day we may receive an executive order to weaponize this functionality for use against terrorists, slavers, rogue polities, criminal organizations, or others misusing Imperial currency. It is, naturally, far more flexible than seizure of accounts (possible in Imperial banks or those of close allies only) or transactions (which requires that said transaction clear directly through the Imperial Banking & Credit Weave) inasmuch as it can revoke any esteyn-units, even those instantiated as physical cash. For these reasons, we retain the technical capability.

However, the projected economic effects of exercising this capability would be very severe. Much of the galactic market can be modeled as imperfectly trusting, irrational, and/or panic-prone, and the use of this capability would undoubtedly lead to an immediate external market crash, extending into a medium-to-long term depression. As a matter of policy, the Exchequer considers this a circumstance to be sedulously avoided.

As a final note, while the existence of this capability is not a secret (note the classification level of this document) since it is readily comprehended by anyone who makes a sufficiently adequate study of the relevant public protocol definition documents, the Exchequer chooses not to advertise its existence widely in the sight of economic knowlessmen. As such, you should consider it sensitive data, not for casual public dissemination.

 

Trope-a-Day: We Will Spend Credits in the Future

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We Will Spend Credits in the Future: While somewhat played straight out towards the Rim Free Zone with its ergcred, a currency whose name is never abbreviated at the front, for the most part we will spend exvals in the future.  (See: Global Currency).

This may have something to do with the way that those proposing currencies named “credit” were, somehow, all accidentally lynched by rampaging mobs of accountants who knew exactly where this would end up. Like the trope example says:

“So as you can see, on 10 June we credited 35 credits to your line of credit and debited 7 credits from your debit card. Then we debited 8 credits from your line of credit and credited 14 credits to your debit account.”

 

Labor Theory of Value

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(I was going to post the next chunk of Before the Phoenix today, but it’s not quite ready yet. So, here’s a quick wee thing instead…)

In the Conclave of Galactic Polities, Ambassador llin-Terl-an of the Palnu Sodality put forward a measure – supported by others of the Socionovist Association – proposing a system of voluntary interpolity fund transfers for the support of those individuals deprived of employment by imported cornucopia and other “industrial magic” automation technology.

Speaking for the Empire, Presiding Minister Calis Corith pointed out that his polity had, by the definitions contained within the proposal, all-pervasive deployment of industrial magic and an employment rate of zero, and thanked those supporting the proposal for stepping forward to financially ease the citizen-shareholders’ negative-value labor deficit at what would surely be a great cost to themselves.

The measure was tabled for further study.

– from the Imperial Infoclast

Trope-a-Day: The Federation

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The Federation: Well, that would be the Voniensa Republic, an essentially conscious Expy of Star Trek‘s Federation.  Unfortunately, the Voniensans have to contend with the lack of the scriptwriters on their side; thus, their baseline-fetishism and naturalistic-fallacy-ridden philosophy (“our insert-species-here-anity”), heavy restrictions on personal augmentation (including ephemeralism, because, y’know, people were meant to die), and information control of dangerous ideas filtering in from the extranet make them relatively technologically backward; their biochauvinism (and even carbon chauvinism) and stance against AI personhood (guess where quite a few of the Silicate Tree’s renegades come from) also doesn’t help in that regard; their strong-central-government system makes them a tottering giant, steering a thin line between collapse and the Regional Governors Being Given Direct Control Of Their Territories; and their dodgy non-agorist economics make them actually one of the poorest – they have rationing, even – purportedly near-post-scarcity civilizations in the Galaxy.  Which takes real talent, let me tell you, when you have even restricted cornucopia machines.

While their volume is enough to keep them at least notionally within the Great Powers club by dint of mass of metal and economic leverage, in practice they’re the Sick Man of the Galaxy in exactly the same way as the Ottoman Empire was the Sick Man of Europe.  And the clock is ticking…

In short, a classic example of how to purportedly-benevolent yourself to death, statist-style.  The Imperials call them “the Land of Murdered Dreams”.

What’s In That Bigger Pie?

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As usual, we regret our inability to provide an adequate economic profile of the Empire of the Star, due to the Exchequer’s ongoing decision to not publish detailed economic statistics suitable for external use, continuing to cite former Chancellor Valéran Quendocius-ith-Lirendocius’s comment that “Publishing such things only encourages damn fools to think they ought to do something about them, and no good’s ever come of that.”

Back-calculation from such internal statistics as are available, such as total collections by the Office of the Imperial Revenue and trade statistics provided by major Imperial trade partners, suggests a gross domestic product of the order of 24.4 quintillion esteyn (317.2 quintillion Accord exvals at current exchange rates); equivalent to a per capita GDP of the order of 9.5 million esteyn (123.8 million exvals).

These figures are highly disputed and subject to error.  In-house and external economists disagree widely on attributive weights, and appropriate means to model factors including but not limited to the sizes and effects elsewhere of the agalmic, prestative, and reputation economies; the proper attribution of value to and the values of externalities positive and negative, household production, and ecosystem services; the Exchequer’s method of computing ongoing net costs of permanent resource consumption; and the effects of post-scarcity production methods on total factor productivity.  Investors are cautioned that such considerations should lead the estimated figures given to be taken as a minimum baseline for comparison; fair-baseline adjusted comparative figures could vary up to 1,000% on the upside, depending upon model selected.

– Investor Watch: State of the Markets, First Exval Bank of Meridian

Space Programs

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title text: “The universe is probably littered with the one-planet graves of cultures which made the sensible economic decision that there’s no good reason to go into space—each discovered, studied, and remembered by the ones who made the irrational decision.”

Initially (economically) irrationally decision, anyway.

I used this trope extensively in developing the Eldraeverse; of course, those single-planet cultures which find themselves overtaken by the expanding edge of the Associated Worlds do eventually get into space. Only to find themselves relegated to playing catch-up in a galactic society that sees them as eternal second-placers, but, hey, lack of ambition has consequences.

[Originally posted elsewhere, 2011/5/3 – I ran across it again, today, and dammit, it’s still relevant.]

Inequality

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(No, don’t worry, I’m not turning into a political blogger, here.)

But I did read an interesting little hypothesis which means I may need to revise my little internal guess as to what the Empire’s Gini coefficient, or your preferred measure of income inequality, is.  (I say internal guess because, well, in-world, no major public body bothers computing any of those measures.  As economic statistics goes, it falls into that category labeled “thoroughly uninteresting”.)

Said internal guess, by the way, has generally been “in the range that makes professional egalitarians blanch and cross themselves”; it’s just that in a society where the most “poor”, “oppressed”, “miserable” people you can find (as a group) live in what would be McMansion-equivalents (if one could strip the term of the implications of both inferior design and construction, and pseudoaristocratic contempt for the parvenu), own multiple cornucopia machines and autominions, and travel to other star systems for business and pleasure, it’s hard to work up too much outrage about teh ebil rich without embarrassing yourself.  Even if the directors of the “Big 26” starcorps and their peer group are using personal lighthugger staryachts to travel between their private vacation moons.

Anyway, money quote:

Now for the fun part.  Imagine people become more egalitarian, to the point where they heap scorn on the rich and successful.  What is the effect on inequality?  By the previous logic, the effect is directly counter-productive.  The more you scorn rich people, the more people you scare away from high-income professions.  The more you scare away, the lower their supply.  And the lower their supply, the higher their income!

Lesson: If you really want a materially more equal society, stop beating up on the 1%.  Do a complete 180.  Smile upon them.  Admire them.  Praise them.  Sing songs about how much good they do for the world.  The direct result will be to raise their status.  But the indirect result will be to pique the envy of status-conscious people, increasing the competition among the top 1%, and thereby moderating income inequality.

On the other hand, if you want to increase material inequality, by all means heap scorn on the rich and successful.  Try to fill them with guilt and self-loathing.  The 1% who remain will find that living well is the best salve for their consciences.

…which argument has some interesting consequences for a society which loves, honors, and near-worships  excellence, success, and yes, wealth in the way that the Imperial mainstream does.  I may need to trim back that Gini a bit after all.

(Of course, the effect would be rather less marked than in an equivalent human society, simply because one of the major psychological differences between eldrae and humans is that the former are not hard-wired to obsess over primate relative status hierarchies.

But then, thinking in terms of absolute status rather than relative status – and therefore not being inclined to practice the negative-sum games in which you can improve your position by worsening those of other people – is one of the reasons why their society has the attitudes it does in the first place, this one included.)