Free Markets & Free Use Commons
by Nathan Cravens
Let us assume, to make this problem area easier to address, that all materials are infinite or adequately cycled above rates of demand; public domain and free use. Let us also assume spacial boundaries are adequately negotiated without exchange trade, state authority, or personal compromise. Based on a free market environment founded on labor alone, it is assumed people are able to earn enough to pay for goods, because prices are reduced in accord to labor cost, since only money goes to pay for labor and no more. Now to address some of the issues that prevent this outcome.
Labor costs will differ based on rates of able bodies per demographic versus demand for output, itself grounded in best known practices of production technique. This depiction means labor is paid per time per outcome based on demands granted by a market area's labor earnings alone. To better represent the variety, in theorem:
"L" or able labor, multiplied by, "T" or time, multiplied by, "D" or demographic demand, minus, "P" or production technique, equals, "M" or labor/market exchange value
(L · T · D) - P = M
The representation expressed by Paul Fernhout to make a similar point, however, is more fun. :p
Jobs = (Demand + War + Schooling - Abundance)) / (Automation + Design)
Demand is limited (the best things in life are free or cheap).
War and compulsory schooling are evil.
Automation and Design are increasing.
Abundance is increasing faster than decay.
Given that, plot the curve of jobs. :-)
To adequately argue for a post-scarcity outcome, one must prove: labor must require zero time, or demographic demand must be fully met without labor, or labor must not be necessary. In essence, the synergies between labor and demand have over time become production technique itself, as decline in labor value since the 1970s indicates in the United States,1 assuming the labor value of those producing imports into that country also decreased, as the present global exchange trade collapse seems to prove. Decline in labor value alone is not enough to conclusively prove a post-scarcity outcome, but at least we have reduced the problem area to labor as a scarcity indicator before working to achieve universal peer production. (post-scarcity or free use commons)
Given we define a free market appropriately as one based on labor exchange value alone, and that it adheres to 'perfect information', and that too is adequately grounded in the problem areas open manufacturing addresses, (up for scrutiny in conclusion)2 these sorts of complications can be addressed by any user and negotiated with the producer via the market until labor is null. Once labor 'no longer equates' it is up for the user to decide based on production technique alone. The free market that comes before this will enhance competition to the degree productions rapidly trend toward full automation or sole peer production (universal peer production) and therefore 'free use' status. Imports from one demographic to another may become an issue as labor costs will differ based on the theorem above, so the challenge is to produce as locally as possible to ensure economic integrity. One production technique used for an outcome may require more able bodies than demand can handle, but if we assume transparency of production technique globally (perfect information), the best production standards can be adopted as quickly as possible anywhere on the globe. This prevents monetary inflation, whether by lack of demand (inflated to compensate payment for work cycles or output without demand) or by excessive demand (inflation due to scarcity of labor). Deflation, in post-scarcity terms, assuming basic needs 'free use commons' are available, means a reduced rate of income is a non-issue.
Free markets, however, do not in themselves adequately address those unable or unwilling to participate in the market. To request free use of resource acquisition of market produce would be to subject it to inflation. By placing demands on labor without labor participation, each non-labor market user is a blow to aggregate labor value and therefore a market's value. Those able, but unwilling to participate in labor activity within a market environment are often ostracized into the workforce or commit suicide, socially or otherwise. Those able to work that choose willingly not to participate in the workforce, but enjoy the fruits of the market, may be interpreted as exploiters from a strictly free market perspective, yet as populations in industrialized areas continue to reduce birth rates versus the rate of elderly increase, this becomes unethical in practice, if free markets ever were. Japan is the most radical example. Due to rapid birthrate decline, the 'Information and Technology Research Initiative' (IRT) was organised to meet these particular future demands. According to IRT's 'Basic Organisation of IRT Research Initiative'3, by 2025, 4.27 million workers will be needed in Japan: many of them to care for elderly; others to replace the jobs the elderly once occupied. By 2050, at present birth rates, nearly half of Japan's population will consist of elderly. By this time the United States and Europe will have demographics issues similar to that of Japan decades earlier. This means that free markets in response to productive demand is inappropriate in the long run. Backed by the University of Tokyo and a plethora of corporate sponsorship, IRT intends to meet demands with the deployment of 3.53 million general purpose robots. Based on this information, it does not require much economic imagination to recognize that if general purpose robots are made to perform "the problem of insufficient labor," and we hope for obvious reasons the practices of producing these devices become public knowledge, the need for labor at all and the work ethic itself will come into further question.
Therefore, a basic income must compensate those unable to work, whether elderly or replaced by advanced machinery like general purpose robotics, or even for those able, but unwilling to work. In kind, since these funds are going to a dwindling labor pool as demand for post-labor output rises; workers; paid or unpaid, must quickly automate labor processes, with or without general purpose robotics, to adequately meet these demands within 'free use commons', whether 'free use' is founded on full automation or automated to the degree processes are peer produced without monetary reward or state authority. (i.e. universal peer production) In a basic income / free market fusion beyond state regulation, (i.e. financial commons) users in concert with labor will have more free time to further perfect productive processes used, which will increase the value of the exchange currency, due to labor or task efficiency per product output—including (we hope) quality. Increased efficiencies mean less need for labor, which is good, as able bodies decrease over time, until 'free use' is attained. Without labor required per outcome category, and given output exceeds rates of demand, the item becomes 'free use' by default.
1. Wolff. 'Capitalism Hits the Fan'. http://www.vimeo.com/1962208
2. Cravens. Holistic Problem of Manufacturing.
3. Information and Technology Research Initiative. 'Basic Organisation of IRT Research Initiative' http://www.irt.i.u-tokyo.ac.jp/intro/index_03_e.shtml