Valuism

= set of economic practices proposed by Jordan Service [1], exemplified in a proposal for an economic platform called Pietra

Discussion

Matthew McNatt:

A.

"It's hard for me to weigh the solutions you're proposing, Jordan, when I factor in the degree of difference in our understandings of history and the problems facing us.

You've made claims in your Medium essay, for instance, like "price has historically been determined on scarcity—not on use," which I simply don't know what to do with. The most common understanding of price in economics is based on marginal utility, which definitely factors in use.

I also don't think of profitability as a "design method that is looking for growth, progression, and expansion—it requires all of those things." Were it true that profitability requires ever-increasing expansion, small consulting companies could never be profitable—yet plenty of them *are* profitable. I think profitability requires a balance of maximizing throughput (gains minus truly variable costs), maximizing net profit, and minimizing items in queue at the primary bottleneck.

Additionally, I don't think of sustainability as "looking for balance—[i.e.…,] looking to have the inputs and outputs in check." While I acknowledge that sustainability is concerned about this balance, I'll point out that so is profit. Sustainability, I think, is related more to (1) differences between intended outputs and negative unintended outputs (externalities), (2) rapidity of remediation vs. thoroughness of ensuring the proposed remediation doesn't generate more externalities than necessary, and (3) the number of enforcement actions in queue at sustainability enforcement bodies (which I think should be a federation of thresholds & allocations councils).

Finally, I think that historically, the invention of the movable cannon drove the turn from feudalism (8th century to 12th century) to capitalism more than simple gains in market efficiencies. The movable cannon significantly increased defense externalities and, thereby, necessitated the creation of standing armies. Prior to the creation of standing armies, nobility (as you mentioned) had first pick of farm and hunting grounds—but it was on the grounds of their defense of the fiefdom. Journeymen, similarly, were able to look forward to respectable positions in the guilds—if they helped defend the feudal system that protected the guilds. (Every country, bar none, that attempted to go straight from guild feudalism to capitalism without the creation of a standing army fell.)

As I struggle to discern how best to respond to what you've written, Jordan, I think back to times I've shared fruits of my work with people unfamiliar with the basic frameworks I use. Sometimes, people have grasped the power of the distinctions I work with and are amazed at some potential ramifications they see. Other times, it's been challenging for people to gauge the value (or lack thereof) of what I'm saying, which is pretty much the position I am in now with what you've shared about Pietra: I don't know what to make of your proposal, other than to say it sounds like the makings of a fascinating RPG! Thank you for sharing it with me.

B.

I listened to your video last night, Jordan, to see if it would help me better understand what you're proposing. I encountered more differences of understanding around matters of fact, but I think I finally wrapped my mind around what you're proposing. I'll highlight some more differences in factual understanding in this comment, then respond to what I think I'm getting of your proposal in the next comment. 1. I don't think currency solved for deficiencies in simple barter exchanges. I think currency, rather, has solved for Dunbar-number limits in networks of trust: most people simply can't keep track of who owes whom what in networks of more than 150 people—yet our societies are much larger than that. In smaller societies, as David Graeber documented in his masterpiece on the history of debt, people often (simply) gift what other members need, with an expectation that that they will be gifted what they need when they need it.

2. I do not agree that fish costs increasingly more the further it gets from its source of manufacture. If the primary shipment of a fish processor's wares is sent thousands of miles inland, for instance, fish may well be cheaper at that distribution node than just a few hundred miles inland from the fish processor (at a store that relies on less voluminous distribution chains). Worse, when fish is transported by rail, there may be fees associated with unloading said fish at any stop between the ocean town and the primary distribution node—in which case fish is even cheaper inland.

3. As an advocate of throughput accounting, I wouldn't count cultural products as valuable assets at the moment of production (e.g., lumber as an asset the moment it's derived from trees). I would, rather, count the lumber as a liability that must be stored—and an asset only once it finds a buyer. (For insurance purposes, the potential to sell the lumber is an asset that's dependent on the storage of the lumber. This potential to sell is cleared once the lumber is sold.)

4. The claim that "We all know this, because it happens within All Known Value" strikes me as an example of the fallacy of division. Consider this claim, which strikes me as a corollary: "We all feel a new mother's hope for her baby, because this hope is within all human feeling." Not really. A new mother's hope is within the totality of human feeling, but her hope cannot be assumed, therefore, to be distributed among all humans.

5. The claim that fishing companies cannot directly invest in a lake that is large enough to be held in the commons by all strikes me as inconsistent with what fishing companies already do: they work with regulators to set thresholds and allocations so ocean fishing grounds aren't over-fished. Citizens outside the fishing industry in turn subsidize the enforcement of these thresholds and allocations. In the case of lakes and rivers, if there is political agreement that a freshwater system needs to be stocked, we'll often see fish hasheries crop up. (I like hanging out by one in Leaburg, Oregon, a half hour from where I live.) Hasheries are funded by tax dollars, whether they are run as government entities or as companies that bid for government contracts. In the latter case, if the companies are public, anyone can invest in them. Whether they are paid in USD or become paid in an alternative currency that employees must redeem for USD makes scant difference that I can see, since USD must still be exchanged for the services they render. The alternative currency would just add a layer of complexity.

6. There is another way, altogether, that conglomerates can currently invest in value creation (contrary to the claim that investment in a value-creation company is currently impossible). Conglomerates can invests in options and/or futures contracts, then use expected returns to finance whatever regenerative operations are necessary to ensure those returns. (If regulations will allow for more fishing when the fish population rises beyond a certain point, then helping the fish population to rise beyond that point will effect more fishing and a lower price per fish. There's nothing stopping a conglomerate from investing in outcomes—even lower prices—that their conglomerate works to ensure.)

C.

When I apply a game theory lens to the model I think I hear in your video, Jordan, here are some difficulties I encounter:

1. I hear no way in the behavior-based system you're proposing to reward *not* doing _________, which is often necessary for ecosystem management. Think of farm subsidies, for a moment, since they were implemented to solve for the social dilemma of over-production. It's possible (barely, and generally unfairly) to work out who qualifies for a subsidy this year for letting his field lie fallow, in order to keep the price of corn high enough for growers to turn a profit. This is made possible by the fact that farmers must demonstrate a *capacity* to grow corn, in order to qualify for a subsidy for *not growing it*.

Attempting to apply the same logic for *not* polluting a lake, I'm left wondering: Would a company have to demonstrate a capacity to pollute the lake in order to receive credits for not doing so? I can only imagine the unintended consequences that would be likely to accrue under such a system, as companies built intentionally idle factors and toxic waste storehouses near precious resources, in order to qualify for credits. Alternatively, if could anyone qualify for not polluting the lake, regardless of capacity for harm, whatever alternative currency were rewarded for *not* polluting the lake would quickly lose value, since everyone could make a claim to more of it for doing nothing.

2. I hear your endorsement of voting to establish measures of behavior in the interest of the common good. I think the mechanism of voting, however, tends to effect measures that are insufficiently granular, insufficiently adaptive, and insufficiently comprehensive. Even experts have a history of being (a) blind to what they're not yet seeing and (b) unwilling to listen to minority voices who are trying to draw their attention to it.

3. I think voting has an additional problem related to ecosystem management, since certain behaviors are *by themselves* undesirable, yet become desirable in and only in the context of other behaviors. When voting mechanisms are used, too few representatives tend to vote in support of behaviors like these, since doing so puts the representatives "on record" as supporting (in a particular context) what most people perceive as bad (without regard to context).

4. Finally, I hear no mechanism in the alternative currency network you're proposing to make "each action in the chain [be] performed only if it's valuable for the group." Honestly, it's difficult for me to hear such a claim in any way other than as "…and then human nature will change, so people who are rewarded with this alternative currency will behave only in ways we all benefit from." We have only to consider basic game theory to see this: If only so much of a behavior will be rewarded (because it's often possible to have too much of a good thing), competition typically occurs around who gets to perform the behavior. To put it mildly, not all behavior in such competitions turns out valuable for the group.

D.

I'm hearing three issues you're aiming to solve for, Jordan:

1. The price of "unskilled" labor being lower than the cost of living—a factor that's present whenever everyone stands to benefit from anyone being able to do such labor. (Michel Bauwens' feedback to me about this distinction prompted me to add an additional criteria to my thinking around it, which you can see in the attached flowchart.)

2. The price of "skilled" labor being challenging to finance, especially in pursuit of speculative efforts to create and market infrastructure or works for the commons. (Chris Cook may have a solution to this; I've thus far been really impressed with his work!)

3. The insufficiency of market pricing to reward preservation of the commons. (I have what I think is a game-theory-sound solution to this one, which I'm hoping some video game designers will be motivated to test as a MMOG. I think it's a novel and compelling premise for a video game or series of novels, if nothing else. Moreover, since it entails illegalities, that's all I'm personally advocating it for.) I appreciate the professionalism of your video production, Jordan, your clear heart for solving for what I agree are some of the most the important issues of our time, and the willingness you have demonstrated to risk your time, energy, and expertise in pursuit of a speculative effort for the benefit of a whole larger than either of us! I commend all of these!

My initial impressions of the secondary value-tracking system you've proposed, in balance, is that it won't solve for any of the three issues above. It strikes me as predicated on some misunderstandings of economics, as well as some blind spots related to game theoretic motivation. I concede it could well be I who is misunderstanding and missing things, so you're welcome to do with my feedback whatever you like.

Even so, seeing all you've put into this, I find myself longing (once again) to see more deep, cross-age communities of practice, which have the potential both (a) to correct for misunderstandings and blind spots and, also, (b) to leverage the talents and enthusiasm of participant-practitioners like yourself in service of a vision of the greater good that crystallizes enough for some of the participants are ready to rally around. I know the work to produce something at the level you've done here is substantial—and it can be lonely. I want to see it less so. Thank you again for sharing it with me!" (https://www.facebook.com/matthew.mcnatt/posts/10222446644490339?)