and the accounting adjustment.
The Living Income. Not basic, because we’re not talking about stuffing people in awful concrete pigeon holes and feeding them bread and water. It’s enough to pay the rent, reasonable power and phone bills (not the currently over inflated levels) and have enough to keep the economy ticking over. Who’s going to pay for it? Countries are in debt.
Well, it’s not a debit in production. It’s not “real” money. It’s not connected to the gold standard. The fiat economy is a system of double entry calculation. Because externalities haven’t been accounted for correctly the numbers are out. Costs of taxes to fund education, housing and an adequate degree of social collateral have been counted as a saving to business when they’ve not been paid. Reductions in costs obtained by digging deeper wells and privatising rain water have been considered incoming credits. If they’re put in the debits column instead, as an accounting debit to be paid the same way as payroll, bonuses or advertising, the sheet can be balanced. In terms of the free market theory, it can be balanced.
The free market system has been throwing up these errors and problems because of an accounting error. The rent needs to be paid. If you’re in a small business and you skip paying the rent, you have not made a profit. You’ve made an accounting error. You get problems. You get knocks on the door. You have to pay the rent.
The Living Income is part of paying the rent. The accounting change is not the end of the world. It’s an adjustment. Business can keep the lease. But the rent has to be paid.
The current numbers of fiat debt can be adjusted to balance enough for an initial payment that will begin to address this outstanding debit. Writing off personal credit card debt, a fair bit of mortgage and student debt is an accounting adjustment the same as the banks bailout was. That will resolve a number of the issues caused by a cash flow and liquidity problem that is resulting from the error. Keeping an incorrect entry on the books is not good business. And we know it’s incorrect. If it was going to work like that, it would have worked. We gave it everything we had. Children in Pakistan are drone bombed over oil. It’s not like we cut corners trying to make it work.
The money available for the Living income will surprise people I think. The amount countries spend on red tape to stop people getting pensions is quite high. By overhauling that bureaucracy it will largely pay for itself. Even if it doesn’t, the share holders aren’t worried about not getting the expected dividends when they have no credit card debt and access to a living income.
There’s a further proposal that the focus of the system, putting the economic theory into a kind of engineering purity, is to properly account for all the costs, keep enough cash circulating and maybe generate a profit when innovation and better logistics and communication result in more available resources and needs being addressed and met. Initially we can expect a bit of fluctuation, growth some quarters and contraction in others. Paying a living income buffers against economic uncertainty by keeping a baseline of stable cash flow within communities.
Taking environmental and social costs into account rather than writing them off as externalities then results in increased confidence. Distribution will be facilitated. And if a profit is made, by getting people’s needs met better and quicker, the dividends get paid to everyone on earth. Because everyone’s a share holder. The measure of success is no longer to accrue fiat numbers but to meet the challenges of balancing the system globally, with those social needs taken into account. Artificial scarcity is revealed as being not a driver of profit, but as missing the mark when applying the theory.
There’s a business challenge for you.
A great many folks in business have realised that this is an elegant way to make the balancing process seamless. To avoid Mad Max. Not only is it obvious in the articles written by prominent business leaders and economists, but anyone who lucid dreams or meditates is aware of this being a very active prescience in our collective unconscious right now.
We’re all talking about it. We might be using different language and feeling different aspects of it, but everyone’s talking about it. And now the technology and communication skills we have evolved make it possible for us to bring it into the conscious conversation, which we do in order to foster the awareness we all need if we’re aiming to do this on a global scale with a minimum of disruption. That communication is one of the things CGI art of various forms will be very useful for now. And isn’t that a fantastic field of opportunity for someone with the management nouse to coordinate hikikomori.