Sunday, June 2, 2013

A longer explanation

1.) Where does profit come from, and what does it represent?

2.) What should be done with profit and who should control this value?

If we can answer the first question, then maybe we can answer the second.

There is a special case of property ownership where profit does not exist.

When the consumer of some product is the owner of the sources or the means of that production and accepts the product as the return on investment, then the price he pays as a consumer is exactly the costs he paid as an owner, and so price == costs and profit does not exist because the transaction did not occur.

This shows the origin of profit is the consumer's lack of ownership in the means of production.

And so we can create business that safely operates at zero profit without harming investors iff the consumers are the investors and owners.

Crowd funding is a baby step in this direction...

To answer the second question, imagine we sell the surplus of such a corporation to non-owners and collect a profit during that transaction.

If we treat some % of that profit as an investment from the payer, then these late consumers slowly gain the ownership needed to also receive the product at cost as a result of their property ownership in the means of production.

This flies in the face of the typical assumption that the workers must bear the costs of ownership.

But it is actually to the workers' advantage to not have that enormous cost - let the damn customers pay for all the land and tools!

So a big part of the reason we use money is to buy products.  But you do not need to buy that which you already own!  If you are part owner of a dairy, then you do not need to buy milk because you own your portion already.

Another, separate reason we usually need  money is to pay and receive wages for work that needs to be done.

Time banking comes close to solving this, but has fundamental flaw in the time-order of it's operations.

It is crucial that workers be able to issue their part of this insuring-currency *before* they do the work.

Think of it as a "promise to pay" in the form of future labor.

When combined with properly distributed property and sufficient vertical integration, we remove nearly all of usual need to pass tokens within that community.

This is a two part optimization that uses property to "pre-distribute" goods and uses promises to "predictively-schedule" services.

This forms the basis of a true insurance for any good or service we wish to guarantee.

These are 'titles' instead of 'tokens'.  They are backed by both:

1.) The property needed to create a future product.
2.) The promises needed to create a future product.

These titles can be used as a currency when the property or promises that back them was improperly allocated (maybe someone changed their mind about wanting peaches, and so wants to sell their portion of the orchard, or maybe had an accident and cannot pick peaches, and so must re-negotiate with the community to do some other work).

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