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Thursday, June 27, 2013

Surplus Wealth is the Engine of Civilization:

Unlike what Ayn Rand believed, great individual men are not the source of progress in the world.  It's been shown time and again that practically anyone, if given the opportunity, can become great.  The bottleneck isn't the number of Napoleons or Stonewall Jacksons in the world, but the wars that might feature their talents.  There are only so many Civil Wars and Napoleonic wars to go around, so millions of great generals live and die without ever getting to show their stuff on the historical stage.  The same is true in all spheres of life.  A great businessman is certainly ambitious, smart and hard working, but they are also lucky, because there are millions of people who fit that description but only one who becomes a billionaire.  Being in the right place at the right time to start a business in a new field, having good family or friend connections, inheriting enough wealth that it can be leveraged into yet more wealth through careful investments, magically becoming the universal standard for the product even though other options were just as good, and so on, more determines success or failure than any individual's actions.

Most scientists make discoveries at nearly the exact same time as other scientists who are making the same discoveries in some other university or laboratory.  This is because discoveries proceed naturally off of previous work everyone has access to, and previous empirical observations everyone has access to.  The final 'discovery' is so obvious by this point that virtually anyone can do it.  The bottleneck isn't Darwin's great mind, it was just sufficient fossil data to see the clear change over time that's the bedrock of evolution.  This is why Wallace came to the same conclusion at the same time as Darwin, but nobody remembers him anymore.  And as for art, Raphael, Leonardo and Michelangelo were all contemporaries of one another and could all do passable work whenever they were hired to do it.  When it comes to artists, certainly individual talent is necessary, but again there are plenty of people who exist with that kind of potential.  What's more important is that they be funded, accepted by society at large (so they aren't censored but instead encouraged), and that they've imbibed some new insight from their cultural matrix that allows them to express something original and meaningful about life, the universe, and everything.  All of these ingredients come from outside the artistic individual and rely on the enlightenment of the masses as a whole to propel their works forward.  Some great artistic works cost millions or even billions of dollars to make, without the support of society at large they are physically impossible.

It's well known that good music follows certain mathematical laws and so composers are more people who can transcribe God's songs well than original artists themselves.  They are more technicians than creators.

This is all just a preface to what I am getting at.  The point is greatness does not need to wait around for heroes to emerge and give it form.  Greatness emerges spontaneously from a wealthy society like maggots from meat.  You can count on it happening without making any further steps towards its generation whatsoever.  Wealthy societies have tons of advantages that ensure success overall -- they can afford your art, you can afford the life of leisure necessary to cultivate your artistic talents, and everyone can afford the education and leisure necessary to be competent and willing to imbibe your art when it's finished.  The same is true of science or any other field of progress.  For instance, if you have some sort of long term business project that costs billions to get off the ground, like horizontal drilling for hard to get natural gas, a rich enough society can fund the project anyway and wait decades to receive a profitable return on the investment.  A poor society is too busy trying to live hand to mouth to fund any long term projects and so all business opportunities are automatically stifled.

Good things happen whenever surplus wealth accumulates, and the more surplus wealth there is, the better things become.  Sometimes surplus wealth exists only in a royal court, and as a result civilization only progresses in the one square mile that contains the luxurious royal palace.  But even then, great poets, historians, artists, architects, and inventors have emerged.  It may not have benefited many people, but the cultured brilliance put on display in these imperial quarters were truly stupendous.  Naturally, the situation improves dramatically when your whole country is rich, as there are more people who can become artists and scientists than before, and more people willing to patronize them than before, giving more people a chance at success than any royal audience could perform.  But whether all wealth sticks to the very top or wealth is spread evenly between everyone, the necessity of surplus wealth is the one defining factor.  If population is so high that no one can afford any leisure time or leisure activities, then civilization makes no progress and nothing of note is accomplished ever again.  History just becomes a long log of famine, pestilence and war with nothing of note moving forward for millennia.

One of the best parts of surplus wealth is the affect it has on people's morality.  When people are well off, they tend to be well disposed towards others.  When people are educated enough that they can think and feel empathetically towards those around them, by for instance watching movies about other people's lives, or reading books from the viewpoint of other characters, they find it much more difficult to hurt other people in the real world, who they now recognize as just as 'human' as they themselves are.  Surplus wealth is the necessary condition for both these ameliorating factors.  Wealth rubs the rough edges off of nature 'red in tooth and claw' and makes us all into gentle lambs.  Without it, we become the most vicious species in the world, capable of any sort of brutality towards one another or Mother Nature.

Therefore, in order to improve our environment and improve ourselves, the answer is always the same, we must produce more wealth, which improves our culture, which improves our quality of life, in a virtuous spiral.  The more surplus wealth we have access to, the better life becomes, the happier people are, the more they contribute to others out of love, gratitude, and empathy, on, and on, and on.  In other words, to secure the general welfare for ourselves and our posterity, the central role of government is to produce surplus wealth for all.

By this I mean that each and every individual, if his potential is to be maximized, must have more than enough money to live off of, so that he can cultivate, in his leisure time, all of his greatest capacities, whether it be through education in technical fields, or culturalization in artistic fields, or volunteering in social fields, or forming a household and raising up the next generation as parents.  All of these activities require surplus wealth, because they are all fields with no initial return on investment, money sinks that no one can partake in so long as they are living hand to mouth.  All of the best and most beneficial acts of man are built upon this foundation of surplus wealth without which they cannot move.

For a citizen to maximize his potential, it may only require a small amount of surplus wealth, because their potential wasn't high in the first place.  Even so, when it comes to their happiness, every additional dollar is extremely valuable, with far higher marginal utility than if it had been given to anyone else.  Scientists have shown this is true up until around $30,000 a year.  Money really does buy happiness.

For other people though, like James Cameron, they need one billion dollars of surplus wealth so they can make expensive movies like Titanic -- which turn around and earn more than a billion dollars in box office sales.  Or people like the scientists of the LHC who require even larger billion dollar installations, or John F. Kennedy who spent a good deal of the US GDP just to land a man on the moon.  Depending on the scale of the dream, some people can use money to achieve greatness that would be wasted in other people's hands.  This is why a flat distribution of money does not maximize utility.  Big dreams require vast riches, and so it is very good that some people get their hands on enough wealth that dreams can become reality.  The Pyramids are still paying off for Egypt to this day.

If the market is left to itself, it tends to concentrate wealth into ever fewer hands over time, until a tiny few rich people own everything in the world and make all their income via rent of their indentured masses.  This certainly allows giant projects to be completed, like USA's transcontinental railroads, but it deprives the rest of the people of the oxygen necessary to breathe and function as worthwhile human beings.  The Taj Mahal is one of the most beautiful buildings in the world, but it is marred by the fact that it is surrounded by tens of millions of starving children begging in the streets.  The answer is a careful compromise -- enough money that big projects can be funded, but not so much that no one else can even live as befits human dignity.

This is why socialism is so vitally necessary to maximize happiness and progress in the world of today.  We need people to be able to afford their petty dreams, like starting a family or decorating their home.  We need their small lives to be lived with a sense of significance, where no one feels what they are doing is a waste of time.  Simultaneously, we need money pouring into ambitious projects like Elon Musk's SpaceX, which gives humanity the hope of someday reaching the stars.  A citizen's dividend which directly taxes 25% of the nation's spending off the top of the economy and then redistributes it to the populace at large is the best fit for everyone's needs.  The federal government currently already spends 25% of USA's GDP, so this is no change in behavior.  It is simply a change in priorities.  A direct sales tax and cash payments has the least distorting effect on the market, and therefore is the best public policy possible.  As the wealth of the nation improves, the benefits to the poor rise naturally, so that they are never left behind.  Furthermore, the economy is still free enough to allocate however many billions or trillions of dollars it wishes to ambitious projects without worrying that government looters will come and take it all.  There is no disincentive to work, because your citizen's dividend does not rise or fall on the basis of need, but stays steady whoever you are, a universal constant.  There is no division of society into 'givers' and 'takers' because everyone is taxed at the same rate and everyone is rewarded the same amount of money.  No special interests can vie for additional funds allocated only to themselves anymore.  We all sink or swim together.

At a per capita GDP of $50,000 like the USA has today, this would work out to a citizen's dividend of $12,500 a year.  This is equivalent to the amount we normally spend on children and the elderly already, while being a healthy raise in spending for the middle aged.  This will allow them to afford college educations, buy a house (rather than losing endless money to rent), start a business, get married and start a family, or do anything else they please in an age when employment and wages are too low to promise any of these things.  If a married couple works together, that's suddenly $25,000 a year to work with, a middle class can be formed out of thin air just through a little cooperation between previously indigent 'losers.'

The health of our society at large drives the rate of progress in our great individuals.  This is because great individuals could be born in any strata of society and need to be given a middle class upbringing if they ever hope to emerge as stars in the future.  Furthermore, the more good people in the world, the more receptive they are to good things, the more good art full of love, beauty and truth is well received.  Jesus was nailed to a cross for saying what he did, and Socrates was forced to drink poison.  This is the major reason why progress was so fitful in the past.  The masses were not ready for what their heroes had to say.  Enriching everyone means fewer martyrs and more heroes emerge.  No one crucified Einstein, so the theory of relativity was allowed to stand.  No one forced Watt to swallow poison, so we got to build the steam engine.

Spreading wealth to the masses is essential if elites wish to have an impact on the world.  If the masses don't have surplus wealth, they'll cling to their old habits and refuse to change for the better.  Even if Darwin explains evolution to them, if they aren't given sufficient education to understand it, they'll reject it and stay primitive fools for eternity.  Society makes leaps and bounds of progress when people are well off enough to accept it, whether it's equal rights for women or minorities, or protecting the environment, or refraining from smoking, or world peace, everything is based off of that initial prosperity that lets people relax and care about things other than themselves.

The reason almost all artistic innovation these days is occurring in Japan is because they do not have any poor underclass.  In America and Europe, our deeply stratified society means there is no popular culture, but only division, animosity and mistrust.  The elites despise the masses and so have no interest appealing to them with art that fits their tastes, and the masses are too depraved to appreciate anything good even if it is cast before them.  In Japan things are different.  The culture is unified, incomes are all near one another, and the artists, inventors, and community all live in one unified sphere of intellectual life.  As a result, it's easy for anyone to break out and succeed, and when they do they're instantly well received.  The source of great writers like Sword Art Online or The World God Only Knows are humble stories of rags to riches overnight when people who had nothing spent their leisure time, unrewarded, on a hobby they loved, and suddenly became rich and famous when they were noticed by society.  Just think how many moving parts such a world requires -- surplus wealth for the artists who think they're doing nothing just for fun -- surplus wealth of publishing companies which will take chances on endless new franchises -- surplus wealth of consumers ready to read endless new books from endless new authors -- surplus wealth up and down the line gave birth to these geniuses who are some of the best story tellers this world has ever seen or known.  Japan is living the dream right now, even without a citizen's dividend, because they are so naturally homogeneous that no artificial measures need to be taken to average things out.  For the rest of the world, which has embraced diversity, and created as many natural barriers has humanly possible within their nation, only the citizen's dividend can possibly average things out again.  If market forces are allowed to thrive in a diverse society, we will end up like India or South Africa -- a rich elite that has everything and deprived slum living masses who have nothing, forever.  That is what we are moving towards even as we speak.  But if we intervene with government action, we can stop this destructive trend and put our country on the same track as Japan's natural heaven, with everyone well off and everyone eager to share with one another their latest public offering.

One other factor is necessary for the generation of surplus wealth, in addition to the citizen's dividend, and that is respect for the economy and businesses.  We cannot afford to kill the goose that lays the golden eggs. If there is too much regulation, taxation, or corruption preventing businesses from making a profit, this will ultimately come back to bite us.  This is why keeping our Heritage Freedom Index high is so important.  It is the single statistic that most closely correlates to economic well being, even better than IQ at predicting a country's prosperity.  The top five freest countries on Earth, according to the index, are Hong Kong, Singapore, Australia, New Zealand and Switzerland -- all extremely good places to live by the way.

Denmark, even with its enormous social spending, is ranked 9th in the world, because it allows freedom and has lack of corruption concerning everything else.  This is my ideal model and is exactly in line with the concept of the citizen's dividend.  The USA, with low taxes and low social spending, is still less free, ranking in at 10th, because of the enormous regulations we micromanage everything with.  Japan comes in at a respectable 24th, but they have such a golden civilization of natural homogeneity that they can get away with these sorts of mistakes.  The least free countries are the expected laundry list of villains, Congo, Cuba, Zimbabwe, North Korea, etc.  Some of these countries even have great human capital, for instance North Korea could be as rich as South Korea if only they allowed free markets -- South Korea is ranked 34th in the world and has a huge per capita GDP, but instead they tanked their freedom index and are now dead last, with a per capita income of $1,000.  How stupid can you get?

Obama's recent moves to regulate our power industry to prevent climate change are a huge mistake which is just the sort of attack on free enterprise we do not need.  This is one of the ways we can destroy our economy and thus any hope of improving our civilization.  When the time comes, solar power will naturally out compete coal and we will switch energy suppliers naturally, using the free market.  Until then, the government should let alone and let the economy prosper using whatever tools it desires to maximize output. Rising energy prices are the primary cause of recessions in recent history, this is the last thing our struggling economy needs.

Any government policy that isn't focused on providing either A) the nation as a whole or B) individual citizens with surplus wealth is a distraction, an impediment to progress, and quite possibly a deliberate attempt to obstruct possible societal benefits at the hands of special interests who want to keep all the wealth to themselves.  There is no more noble goal or beneficial action a government can take than providing surplus wealth to all.  Therefore, legislation concerning any other issue is a waste of time and a mistake until this issue of the citizen's dividend is solved.  Gay marriage affects at most 3% of the population and is merely a change in semantics.  The citizen's dividend affects everyone and changes their life in a meaningful and massively positive way.  It would be the most important law ever passed in American history.  We did not elect Congress and the President to debate how many angels can dance on the head of a pin or what 'marriage' means.  We elected them to help the economy and provide us with more surplus wealth, in the form of jobs, handouts, or anything we can get our hands on.  The American people need to hold their representatives accountable and stop letting them natter on about everything except the economy, the one and only subject that matters in the long term.  If everyone's rich, they really could care less who Bob marries.  If everyone is poor, Bob's marriage opportunities are the least of our worries.  As Bill Clinton once pointed out, It's the Economy, stupid.  It always has been, and it always will be, the only significant factor to our quality of life.  The rest is just hot air.

1 comment:

Anonymous said...

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