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Michael Haupt's avatar

Probably the best distillation of the international monetary system I have ever seen. Great job, Brett!

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Brett Scott's avatar

Thanks so much Michael - glad you find it useful

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Charles Hett's avatar

Brett, brilliant and thank you - you continuously help me understand more & better.

Alongside energy balance (there’s a planet earth involved somewhere), there’s an uneasy balance with “violence” (or maybe we call it a “jubilee”).

I am waiting for the rest of the world to call on (or enforce) the 1 year of “labour” from all 300m+ US citizens, they are “owed”.

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Dave Foulkes's avatar

This is impressive.

How to account for energy and automation since the Industrial Revolution is not covered but that’s not so much a criticism as a question I have.

As in: if our perceived debts in the interpersonal space are based on labour, what happens when that labour is more and more done with a combination of energy and automation?

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Brett Scott's avatar

Hey Dave, glad you like it. In terms of energy and automation, those essentially scale up labour power, but a monetary system is always about *relative* balances between people, so as the general level of labour productivity goes up in the network (aka. as the power of your labour gets amplified by energy and tech), the relative positions of each person might remain the same or change, but a money system is always about that relative position. This is why we can have people in incredible levels of poverty, despite the fact that our absolute labour power has been massively amplified over time

Another way to conceptualise this is to reimagine the collective output of the eight people as the 'living standard', but individual members of the network that fail to get an equal claim on that are below the average - in a capitalist system this is huge problem, because to compete you often need to be staying above the living standard so that you don't get 'left behind'

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Brett Scott's avatar

Just to add to that: One of the big stories of capitalism has been the control of the 'means of production' by small groups of people - aka. control of the means of *labour amplification* - which means some people contribute the labour, while others own the means of amplifying that, which means those others get to take an outsized cut of the absolute increase in labour power in the overall network due to energy and tech. The alternative would be for every single person to collectively and equally own the means of labour amplification, which - theoretically at least - would mean the relative positions of the people in the proverbial 8-person system would remain the same rather than deviating in extreme inequality

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Dave Foulkes's avatar

Got it. Thanks for such a considered answer. Actually Varoufarkis had a good stab at explaining how that last scenario (anarcho-syndicalism I expect) might work in practice in Another Now. It was complicated to say the least! And one thing you seem to appreciate is if it’s complicated to explain and ‘get’ then it’s almost impossible to get traction for change with.

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Tad Wolff's avatar

A related image that I use is the water balloon. The government’s power is like water in a balloon. They are so powerful that they can declare little pieces of paper to be valuable, and enforce it. They issue/send these chits (dollar bills/tbills/bonds) into other areas of the economy (balloon) to empower and enrich companies or people, to jump start the economy. Later, during the economic boom, the government pulls the money back via taxes, as if they are squeezing that end of the balloon. In doing so they have proven their power again. And the process starts all over.

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Ugbaja Declan Emeka's avatar

This is brilliant. It gave me more practical understanding of the global monetary system. Thank you.

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Brett Scott's avatar

Glad you like it!

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Mrtyu's avatar

This is dynamite!

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Mrtyu's avatar

You keep getting better and better in summarizing and visualizing it! Great job

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Mrtyu's avatar

(I don't want to sound superior, i just wanted to enlight your "bettering" in relation at your old you)

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Johan Verster's avatar

Thanks for another "cracker" Brett. To fully make sense of it, your "zero is the future of money" is a must read. I've tried (so far without success) to bring to your attention, our LOVE Money (a play on the love OF money) white paper, which essentially "makes possible" the decentralisation of the "relative positions" of ALL 8 billion inhabitants of planet earth. I would love (no pun intended) to hear what you make of it. I also loved your recent video "lessons i learnt paying $9000 for a pizza". You can check out the white paper here:

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NaijaMan's avatar

Wow! That piece gave me a bigger kick than my morning coffee. Thank you Brett!

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Brett Scott's avatar

Ha ha, pleased that you like it

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Michael Nußbaumer's avatar

Looks like alien space ships ruling humanity ;-)

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Fisayo Ajisafe's avatar

This is a very brilliant illustration of the global economic system. Well done!

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theWearyPilgrim's avatar

So what is the worst possible outcome? I am a simple man that worked very hard to accumulate a way to survive while sharing with those in need and apart from the expectation of anything in return. Life isn't fair and realistically speaking, hard work doesn't mean certain success or predictable outcomes. I've never given this much thought only that I naively expect others to assist me if I'm courageous enough to ask. In your model, we the peons, shouldn't expect to be on the receiving end of such surplus unless we forsake every human kindness and shrewdly trample or snuff out the existence of others to get toward the top where bigger slices of the pie are served. No thanks, I'll keep my conscience in tack by continuing to trust my soul to our faithful Creator and soon coming King Whose Kingdom is not of this fallen world, love others, and die in the grace and peace of Christ Jesus fully convinced that this world along with every evil institution and system will be destroyed when Christ returns. Thanks for your pictures and analysis, you have deepened my faith and hope in Christ Jesus.

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Gustav Huber's avatar

Picture 2 is not correct: There were heavily defended social standards which prevented the "stronger" to get strong in an unpleasant way.

But after removal of this resistance, you are right. Therefore its all about (non-)transparency.

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Arian Pleroma's avatar

Really good. I have worked out something similar myself, but my focus was more on the capacity aspect that forms social hierarchies. The fallacy is that we subconsciously value institutions over individuals.

Usually, there is an assumption that abstract institutions are more trustworthy than people. However, at both the beginning and end of every institution are individuals who embody its values. The same happened with so-called “trustless systems” in crypto, which led to horrendous scams because we cannot—and should not—exclude the human ethical factor. We face the same issue with AI. It is neutral and will only reflect the mindset of the people who build it. Period.

All power hierarchies are disguised by the implied ideal power hierarchy (meritocracy), which supposedly arises from imbalances in capacity. One of the fragmented narratives used is that people with privilege have earned it through hard work. The circle you illustrated does not even out equally. As we see with entrepreneurs, they work many more hours, have more skills, take greater risks, and employ many people. Yet, privilege and responsibility do not match. There is a dynamic whereby people who reach a certain income bracket enter a different class with different rules, and those with the power to change things tend to follow the path into privilege rather than reform the system.

We have to rethink a harmonious model of social classes.

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吴股杂良's avatar

Ah. So the king can request token back in the name of tax or protection fees because he is powerful , he is awesome, and he is big and beautiful. He can just give the token in exchange for your labor, goods and services.

It is a beautiful country.

Thank you for your attention to this matter.

* but as a a user of weak currency should not I just use USDT/USDC for my storage of labor?

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Sean's avatar

This is intuitive and helpful thank you. I feel like this builds very directly off the ideas in David Graebers book

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ethermal's avatar

Yeah it made me think of Garber's work too.

But in Debt: the first 5000 years he explores how the social conception of debt as a zero-sum game developed - and that wasn't always seen that way. Sadly I can't recall everything he wrote about the feelings of obligations between people

I wonder if there's a better framework to analyze the economic relationships of people that is less transactional?

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Sean's avatar

I also feel that representing the monetary system in this way shows a lot of parallels between our created systems and ecological systems that occur organically. Meaning that all actors in the system monetary and environmental are intrinsically independent because they have the capacity to manipulate their surroundings but those actions are balanced by the effects of those actions on other actors in the system. The thing that is exchanged in a monetary system is trust (expressed in currency) and the thing that is exchanged in the environmental system is energy (?)

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