Distributed Income Support Cooperatives

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Max Borders:

"If a distributed autonomous organization (DAO) is a decentralized way of coordinating activities to create value (upgrading the traditional firm), then the DISC is a decentralized way of coordinating mutual aid (upgrading traditional welfare). DISCs, like DAOs, will be voluntary, permissionless, and most likely ambivalent to questions of national origin. These cosmopolitan entities will bind people based on the desire to create better social safety nets, not based on accidents of birth." (https://medium.com/social-evolution/how-we-become-the-social-safety-net-2994a68a53db)


Max Borders:

"The DISC framework differs considerably from a UBI in that it’s designed primarily as a system of mutual aid instead of a system of redistribution.

This is important, because DISCs:

  • Are emergency measures, as in a form of insurance that kicks in when needed, reducing perverse incentives;
  • Are decentralized, so that they can’t be used as a massive lever of central power;
  • Don’t require politics, so they can be voluntary and self-organizing;
  • Are affordable, because they target isolated needs;
  • Are supportive of community, because they operate embedded in human fractals and reputation systems;
  • Can be relativized to various regional and individual economic circumstances;
  • Can be built in tandem with DACs and DAOs, or so that people can get income support between gigs, say, in the fluid blockchain labor marketplaces of the future;
  • Can be configured a mutual-aid system in which the community surrounding a person validates the need and stakes reputation capital on such validation;
  • Use reputation as a currency of trust;
  • Scale with displacement and poverty without being monolithic.

While we are only at the genesis of the decentralization and polycentrism revolutions, the world is moving away from monolithic social systems. Instead of thinking about how we can outsource our sense of responsibility for each other to distant capitals, let us think about how we can create and join systems that, eventually, allow us to become the social safety net." (https://medium.com/social-evolution/how-we-become-the-social-safety-net-2994a68a53db)

Peer Pools

Max Borders:

"DISCs, therefore, would have peer pools and peer juries.

These mechanisms mean that people can join communities of contributors, but each member of the community is accountable to every other member. That you’re accountable to the other members means you always have incentives to do what’s right so as to keep your membership privileges intact so as to enjoy future potential benefits of the DISC. I am fond of social theorist Marshall McLuhan’s saying “We shape our tools, and then our tools shape us.” Elsewhere I add: “We shape our rules, and then our rules shape us.” This is no truer than in the social support systems we create, which can help us to rediscover a sense of responsibility to others (or lose it).

Peer pools are the internal mechanism of DISCs’ mutual aid support systems. These collect dues on a periodic basis as a condition of membership, although the dues might be as low as pennies a month. People can be members of multiple DISC cooperatives, which means you might be a member of a pool associated with healthcare, and another pool associated with unemployment. In any case, every member contributes based on his or her ability to contribute. I realize this sounds vaguely Marxist, which is fine. I prefer to think of it as a form of distributed social insurance that includes some members who are more likely to be net contributors, and some members who are more likely to be net beneficiaries. (I assume enough high-income people will become members, as we’ll discuss. In this way, pools are neither purely transactional nor purely charitable, but rather a hybrid.)"

Peer Juries

Peer juries will be responsible for making determinations about the validity of claims to peer pools. Perhaps each member of a DISC will have, say, a mix of members she knows and others she doesn’t know to serve as her peer jury. DISCs can experiment with ways to make juries fairer and more game-proof, but the idea is to use reputation as a strong incentive to get things right — both with respect to disbursement of support, as well as strong incentives to apply for pool benefits based on genuine need. Aligning the incentives in such a way that balances the needs of members against the health of the DISC will be critical to the success of these entities. And peer juries serve a vital feedback function that UBIs don’t, as the latter treats the entire population as a black box into which largess must flow. We can imagine all manner of governance functions within peer juries, including localized liquid democracies."

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