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

Taxation: Not-a-Taxes

And now to the comment I wanted to answer:

Back on “Trope-a-Day: Intimidating Revenue Service“, Mark Atwood commented:

On the other hand, I do wonder what the various access fees, use fees, and voluntary organization membership fees all add up to.

The two examples I am thinking of are:

For the case of the eldrae, the dogcatcher org that has already been shown as an example, that in our world is a government activity paid for out of taxes.

In our world, up until the 1930s, building things like sidewalks and hospitals were funded by the voluntary merchants associations and voluntary fraternal organizations. And while membership was completely voluntary, and while participating in such fundraising while a member was again completely voluntary, NOT being a member, or NOT being seen to throwing a goodly amount into the hat when it was passed, was guaranteed to freeze you out of society, and if you were a member of the professions, completely out of your ability to practice your profession.

So, yes, this is a thing, because some things that we have governance do here are indeed useful. But it’s not nearly so much of a thing as it might be – by the time you add up all the assortment of necessary things, I would be very surprised to find that they came to more than 15%-20% for all of ’em stacked up together for a generous helping of relevant analogous services (and, arguably, distinctly non-analogous service levels), vis-a-vis the grotesquely high numbers one can see *here* when adding up all the different taxes of different kinds, and never mind the inflationary effects of making up holes in the budget in other ways, too.

There are a number of reasons for that:

The first and most obvious is the sheer number of things that aren’t done at all. To start at the really obvious end, while it’s easy enough as a government to spend money on things like prohibition, John Pistole’s pre-flying grope-a-thon, extra-charge licensing of any number of day-to-day activities, official protection from the dreadful, dreadful scourge of people growing edible plants in their front yards instead of grass, etc., etc., ad literally naus, it’s damn near impossible to convince them to purchase such services to be applied to themselves. I could grow this list basically for ever, from authoritarianism to subsidy and back again, but it’s such a long list it’s probably easier to let you think of your own examples.

The second entry in this category is things not done for practical reasons, because they have to survive a private-sector planning process. If an odocorp doesn’t think there’ll be customers for its road, they don’t build a road. If the high-speed rail magnates don’t think a line will run at a profit, they don’t build a line. No-one’s wasting money on bridges to nowhere in this polity.

The obvious rejoinder here is that that makes it very hard to build obviously good things in the long term, like the interstate highway system or the transcontinental railroad – which is fair, and I can see that being a big issue in a society more like ours. In their case, though, partly it’s a matter of their longer lifespans and thus planning horizon making such things look like better investments (and there were some very large, long-range speculative loans being floated, here), but also, as I think other parts of their history demonstrate (the colonization of space, the orbital elevator, the first Thirteen Colonies, etc., etc.) the eldraeic risk appetite is somewhat different than the human one when it comes to Doing (or even Funding) Great Things. That’s valxíjir for you. It’s better to fail at attempting something great than to succeed in bein’ a mediocrity – and, in fairness, when you live forever, you can always try again1.

The third is that the organizations providing this sort of thing are immersed in a free market, and I mean a free free market. The rapaciously creative-destruction-filled kind, in which artificial barriers to entry and incumbent protection and regulatory leveling and other things that favor people who play the system are stripped bare, leaving nowhere to hide for private-sector inefficiency and incompetence, much less the kind  we see in the public sector, here. It’s easy to get away with high costs and poor service when your funding won’t suffer. An analogous organization *there*, be it ICC or COG or plain old non-profit branch, that indulges in such things is chum for the competitive sharks.And, relatedly, being the bunch of bloodless rationalists that we might stereotype them as (“shut up and multiply, son!“), this sort of consideration applies to charitable and mutual-benefit organizations every bit as much as it does to for-profit ones. Those voluntary mutual-benefit or charitable organizations which can’t demonstrate that they’re having a real, measurable effect, and for that matter a real, measurable effect that’s worth paying their price for, and for that matter a real, measurable effect that no-one else is providing markedly more efficiently, are not long for this world in Imperial space. We’re payin’ for results here, not warm fuzzies.

(With specific regard to your second point, there, by and large people will get cranky if you’re still receiving the benefit while not paying for it, but true non-excludable goods in that sense aren’t all that common. No-one’s going to come after you because you prefer your own arrangements health insurance to that which you can get the Fraternal Association of Hole Wranglers, or whatever, although they may want to know why in case it’s something that they ought to fix. You may suffer a bit, professionally, if you aren’t a member of any relevant professional association, as among the things that consumers like to see is the seal of a guild professional, but again, it’s not like those are legal monopolies, and in almost every case if you don’t like the deal one guild offers its members, you can go join another one whose package deal you like more. And, if your personal reputation can hold up alone, there’s also nothing from stopping you from trading just on that – the seal’s just there to back up your rep with theirs, like any qualification.)

The fourth is the difference in the regulatory burden. For various reasons (including, of course, not having been bought by incumbent interests), there’s a lot less of this to start with, but it’s also qualitatively different. No-one there thinks it at all sensible to write thousands of words on what, exactly, constitutes a officially-approved lettuce, or the one true standard procedure for polymethadamnpainintheassyne disposal. They write “products sold must be as described” (Much of this specific area is left up to the (voluntary) guilds – the Edifacient Sodality of Bakers and Pastrywrights, for example, has a great interest in protecting the integrity of its seal, so it keeps a good eye on the product quality of its members.) and “don’t dump or leak polymethadamnpainintheassyne into the atmohydrosphere”. In short, they concern themselves with ends, not means, and that means that people can apply innovation to this sort of thing without having to wait for the creaky mechanisms of governance to approve whatever new thing they came up with, and no-one’s being told that no, they can’t sell their polymethadamnpainintheassyne because it’s toxic waste, even if this company over here uses a million gallons a year of the stuff as feedstock, and, yes that’s a real example of just how ass-backwards things can get *here* .

The disadvantage of this policy, of course, is that it requires that the people administering it be able to use discretion and judgment and so forth rather than simply adhering rigorously to The Book. The position of the Imperial culture on that one is that anyone who can’t exercise judgment in their job should be fired and replaced by a simple robot, and in particular is manifestly unsuited to any sort of supervisory position over anyone ever, so suck it up, already.

The fifth one is plain old alternative monetization. Being private-sector organizations, the people who provide all these services are perfectly free to seek alternative ways of raising additional funding. The odocorps are, I am pretty sure, making good money offering all kinds of value-added travel services, not to mention roadside advertising and selling interesting statistical information, all of which subsidizes their primary service, and much the same goes for most of the other organizations in this category.

So, in short, yes, there are a bunch of those things which most people pay in day to day life, but by and large, those plus the ESF still don’t add up to close to the tax burden most economically-equivalent-yet-unfree civilizations impose.

As a side note, another thing that helps a lot in making this sort of thing work is the general ethos that when you find a problem that’s not being dealt with and that you care about, the thing to do is fix the problem, or if it’s too big a problem for just you, round up a posse to fix the problem. One of the major problems that people from *there* would have with “activists” *here* is that problems are there to be fixed, and people who prefer to sit around whining about raising awareness of the problems should get the hell out of the way and let someone serious in there to actually tackle it.

(And people who prefer to sit around demanding that other people should fix the problem for them should be thrown out.)

((And people who prefer to sit around demanding that other people should be forced to fix the problem for them, or else, should be thrown out the airlock.))

It’s not a universal rule – I am reminded of that one Occupy group, of all things, which decided that the best way to solve the problem of people suffering under crushing unrepayable debt was to solicit donations, buy up the debt on the collections market, and then forgive it. Those guys get a big old Buddy Jesus Thumbs Up from the Imperials for doing things the proper way – see problem, devise solution, act. But for the most part, shit and valxíjir, do or do not, already. There is no whinge.

But then, I am writing in the universe in which – well, it’s difficult to draw exact parallels due to the differences in culture, commercial culture, and economics, but in which I’m pretty sure the local analog of Sam Walton was given a knighthood-equivalent and a damn great statue for Services to Supply Chains in the Noble Cause of Ending Scarcity, so.

1. They have lots of serial entrepreneurs.