In “Wired for Culture”, Mark Pagel makes a compelling case that the reason for human ascendency is our ability to understand what others think and learn from each other. However, there is a downside as it allows us to devise strategies to take advantage of others.
Social learning is visual theft. If I can learn from watching you, I can steal your best ideas without investing the time and energy you spent developing them.
Pagel, Mark. Wired for Culture. Penguin Books Ltd. Kindle Edition.
Culture continually evolves, and we devise technologies to help each other survive. Money is a technology that allows us to share goods and services. We noticed that free markets with many buyers and sellers of the same goods permitted us to share the profits we make from applying knowledge. Those skilled at some tasks kept prices down and shared their gains with lower prices for buyers. Competitors could come into the market and make sure that sellers kept prices down but left sellers with enough profit to make it worth their while.
Unfortunately, we forgot this lesson with Capital. Capital is the money we spend to establish a business and to buy machinery and technologies to operate a business. To distribute Capital, we invented Capital markets and to give Capital a value; we invented interest and Capital gains. But, Capital markets don’t work the same way as goods and services. Only those with Capital can become buyers or sellers; the more you have, the greater your advantage in the market. Even worse, Capital accumulates in piles of money, not doing anything useful, leading to the paradox that the more wealth we have, the less productive society becomes. Finally, profits from Capital are taxed and redistributed at a considerable cost to society.
Capital markets still have a useful place when the outcomes of investment are uncertain, but for essential community goods or commodities, they are too expensive.
A simpler, less costly, and more productive way to transfer Capital for essentials is to include a transfer of Capital to buyers with each purchase of goods and services. To ensure the system continues to serve consumers, consumers have a voice along with investors in the governance of the Capital. Governance is simple and brings competition to Capital distribution and divides the buyers into self-selecting groups that can compete for the best way to invest Capital.
To see some of the ways that Capital can become more efficient, visit Consumer Capital is Efficient.
Visit Find the Money to Survive for readily available wealth that owners can keep but allow others to use to address our common existential threats.