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Saturday, October 03, 2009

BECAUSE I CAN: A World Without Money, Part II

Because I Can with Adam J. Kovitz


“A bank is a place that will lend you money if you can prove that you don't need it.”

- Bob Hope

Michael Moore, in anticipation of his latest documentary Capitalism: A Love Story, was on Larry King recently and stated that capitalism has failed. This got me thinking back to some of my earlier writing this year, in particular A World Without Money back in March. It was a hypothetical thought experiment, looking at what one might would do if they didn’t have Financial Capital. Bottom line of the article…we would leverage what we know (Intellectual Capital) and who we know (Relationship Capital) to provide for our needs.


So this month I return to asking a similar (yet different) hypothetical question…why?


Because I can…the question: What would the world look like if business enterprises stopped accepting money (or anything else) as payment but gave products and services away for free?


Businesses become Not-for-Profit Suppliers and Distributors

If you currently own your own business, breathe deep and don’t panic…remember…this is a hypothetical situation.


If your business gave away its products and/or services for free, there would be several concerns:

1.) How to structure such a business

2.) How to ensure cost of business is covered

3.) How to provide for product/service demand

4.) How to keep good employees


Under such circumstances, the most logical configuration for such an enterprise would be a not-for-profit entity. In this case, companies would not pay taxes (we’ll talk about government impact later) and would have to make sure that demand for products/services were covered by an appropriate operating budget.


The operating budget would cover things like inventory, communications, office supplies, etc. All of these would be provided free of charge from other not-for-profit suppliers. Inventory and supply levels would have to closely match demand for services. Surplus or shortage in inventory may be moved between businesses of similar nature, perhaps by other business entities.


The most effective way of providing for product/service demand may mean a return to the old Main Street days where there were smaller hardware stores and grocery stores in smaller neighborhoods without the current “big box” providers we see today. This would particularly be the case with businesses catering to basic human needs like food, water, shelter and security whereas other services may be more regionalized.


The interesting thing here is that there won’t be need for competition. People who share the same desire to be in the same enterprise yet would normally open up competing business might join forces and combine their own Intellectual and Relationship Capital to provide to the community. Even if such competition existed, it would not last long as:

  1. It would be seen as wasteful
  2. Competitors, if egos allowed, would merge, or
  3. Competitors with the least market share would lose interest, fold and move on to their next enterprise.


So how does one staff such an organization? What incentive does one offer for a job that pays nothing? The answer, just like any other not-for-profit that needs to attract volunteers: people invest there time in causes they believe in.


The rise of the Volunteer/Investor

Isn’t it neat to hear a famous celebrity who has made it big, do something nice for charity as their way of “giving back to the community”? In such a world as we’re describing, everyone gives back to the community...it’s just a way of life.


Imagine going to a job not because you have to, but volunteering/investing your time in a cause to which you have interest, expertise or simply a desire to learn. What kinds of things would you do? Of course not every job would have openings or need for everyone, and certain jobs might require certain certifications or prior expertise, but it might mean an investment of time in a learning institution or time with another job first.


What about the basic needs/rights like food, clean water, shelter, security, medical needs, waste disposal, energy and education? They would all be provided for at absolutely no cost. In return for such services, volunteer/investors will have to report their time (in hours per week or month) to a central authority. In this way, there will be less temptation to take advantage of getting something for nothing.


The infirmed and the elderly, while not being able to provide the same standard of hours per week will, depending upon their unique situations, have reduced or less hours to provide for their needs. Children, while spending most of their time in school would be able to at certain ages (like 13, let’s say) begin to volunteer/invest hours in other ventures/causes as a means to provide them with practical hands-on community service and education.


Who ensures that volunteers/investors don’t just jump from assignment to assignment without causing ventures/causes from collapsing?


Each assignment would be contracted for a standard period of time for which the volunteer/investor must serve before moving on. This ensures that a particular venture/cause is staffed appropriately. This also means that the head of each venture/cause (and other management) must ensure that projects are staffed and that volunteers/investors have a clear “career path” in case they wish to renew their contract.


There would be true choice as a volunteer/investor. How much time do you choose to devote to each venture/cause? Do you have the vision to start one yourself? Do you go to learn by working for another one? Note here that entrepreneurialism exists as new ventures/causes can be started at any time. Please also note that there is flexibility in working for situations where one could work a “full time” job while also doing one “part time”.


What is the incentive to work more than one job? Plainly and simply…career development or belief in a cause.


One of the dangers of a world without money is the desire for one to acquire as much as they can, whether it be for status or just for that “rainy day”. The amount of stuff someone can have of certain items would almost assuredly need to be regulated, otherwise demand rises, unnecessarily.

But who regulates all of this?


The answer: government.


The role of Government

Now I consider myself neither a “big government” or “little government” kind of person, but in this hypothetical scenario, government will have a role in oversight and regulation on numerous issues affecting local, regional, national and international levels.


Volunteer/investors would apply for certain elected positions, while other governmental positions would be staffed like any other venture/cause.


Some of the issues government will have to contend with in this new world would include, but not be limited to:

1.) Inventory caps on certain items for ventures/causes to prevent inflated demand

2.) Caps on personal inventories for volunteer/investors such as number of cars, televisions, computers, refrigerators, etc.

3.) Developing legal controls for determining breech of contract

4.) Developing audit controls for determining if a venture/cause is a real venture/cause or not

5.) Developing, overseeing and enforcing educational standards

6.) Developing, overseeing and enforcing food & clean water standards

7.) Developing, overseeing and enforcing safe housing standards

8.) Developing, overseeing and enforcing medical standards

9.) Developing, overseeing and enforcing transportation standards

10.) Developing, overseeing and enforcing energy standards.


In short, much of what are governments do, or are supposed to do these days will basically be the same, with the exception (of course) of taxes and money regulation – they wouldn’t exist.


UnReality or Possible Reality?

While the above scenario describes what some might view as a utopian world, it would be foolish to think that it wouldn’t have its problems. A recent article on cnn.com spoke of an international poll revealing that money is the biggest cause of stress around the world. In this hypothetical world, we would not have this kind of stress. We would certainly have other concerns and stresses, but money wouldn’t be one of them.


With money now as a thing of the past, banks, financial services, tax preparation and insurance all go by the wayside…hypothetically, of course.


Crime, especially theft, is dramatically reduced. What is there to steal?


Luxury items would also go away, as well as class and caste systems. Everyone would be equal and would be open to pursuing the same opportunities that everyone else would have. Leverage would no longer be used to hold power over someone else.


Certainly much, much more would change in a world such as this, but is something like this real?


Not at the moment.


Then is it worth talking about?


Yes…in our current world of economic uncertainty as a result of corporate irresponsibility, political corruption and greed, any ideas to reform the system we currently have only benefits fewer and fewer individuals while becoming less and less sustainable by the minute. It’s much like putting a band aid on a gangrenous limb…masking over the root cause of the problem while delaying the inevitable. In the meantime, thousands, tens of thousands, hundreds of thousands and even millions of people continue to suffer.


So is it an idea worth pursuing?


Yes.


Why?


Because we can.


Adam J. Kovitz is the Chairman & Founder of The National Networker Group of Companies, which publish The National Networker (TNNW), provide member services and consulting as well as branding and social media domination.


For more about Adam J. Kovitz, please click here.


Hire Adam to speak at your next conference or event by emailing info@thenationalnetworker.com.


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The Emergence of the Relationship Economy


Relationship Capital is the cornerstone of the Relationship Economy, which RNIA defines as “a measurement assigned to individual and organizational entities based on the relationship interactions between them, and the interactions they have internally.” I am proud to have contributed discussion of the Ten Laws of Relationships Capital to The Emergence of the Relationship Economy, now out as an eBook and in hardcopy. With a forward written by Doc Searls (of Cluetrain Manifesto fame), it is being considered a “must read” for anyone responsible for the strategic direction of their business. If you would like to purchase your own copy of The Emergence of the Relationship Economy, please click here.


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6 comments:

HarCohen said...

You pretty well defined the communist state. I don't see a reason to get into the pros and cons and workability. You don't have money but you still crediting through time reporting.

Let me counter propose something else in the nature of crediting. Everyone might be credited for the kilo-calories produced. Value-added elements come from transforming products using energy.

Re-framing money as energy puts issues like global warning, fossil fuels and renewable energy up front and personal. The calories to keep children healthy in Africa comes to a similar number of calories required to keep your child healthy in the US.

A successful farmer will sell at some fraction above the resources consumed and the calories produced. His food and shelter must be taken into account. Machinery will still be depreciated. And so on up the production chain.

Metal prices might relate to the resources exhausted in mining.

An energy unit might become a gold standard on a regional basis (some areas require more energy for survival than others). Conserving wealth could become synonymous with conserving energy. Prioritizing projects becomes a matter of calorie reward per calorie expense in a marketplace, rather than a matter of governments and committees.

Both your concept and mine remind me of some old science fiction stories. Yours from a novel called 'Troika' or Star Trek. Mine might be from Herbert Hoyle, a decade or two before.

Anonymous said...

As the previous commenter stated, it is about communism. Myself I am also looking for some other system than capitalism, but I cannot find anything that would work. The government you present would generate enourmous corruption. Your hypothesis is based on another hypothesis that all people are good, fair etc. It is not the case. Just check what happened in USA when Obama started introducing public health system. At first you may want to talk to the people in Texas and Co. who objected to that idea. At present there are 1 billion people who starve. There are many who just do not care. You will not convince them to follow your idea "just because". They "just" need money :)
I assume the only thing we would need is to tune the existing capitalism. Scandinavian do this based on socialism-based rules.
You may also want to watch the Minority Report film, it is very similar in the basic idea.

Anonymous said...

Based upon a quick read of the hypothetical economic system, I think this idea is closer to distributionism (distributist) than communism. Obviously captialism and communism do not work, so I'm all for a third way of economics.

jeevblogger said...

It is true that capitalism and communism do not work.It is realized by intellectuals & policy makers.It is more corroborated by upsurge of conflicts in societies.Business are operated undermining human values.It is well said in following proverb in Hindi.
Dhandhe main koi dharam nahi dekha jata
Rishte main karam nahi dekha jata
Dalali main sharam nahi dekha jata.
It means in English..
Business is done without religious consideration.Relationship are sustained without demand of gratitude.In brokerage, one should no shy to demand brokerage.
If we read underlying message in above proverb,It hints that one should value gratitude in buziness & tender creditability in their relations.One should include ethical outlook to relative offering due credit to them.I hereby propagate message though my blog..with http://www.winwinbharat.webs.com
Bharat Sadani

Anonymous said...

How about using the economy of "good deeds" versus "bad deeds"? Similar to the basis of all religions...Good deed will earn you a point, bad deed will take it away...You earn points to buy the necessities, which can be sold/purchased at production costs+set amount of profit which will be known to the world. Good deeds could be everything we teach our children in their moral lessons (which, unfortunately, are forgotten by the time adults start their journey with the sole purpose for their existence - "greed"!).

Or simply, ban accumulation of anything at all - which will curb greed in it's roots...

Excess greed or "Capitalism" is the cancer. If you kill it soon enough, human race may survive for a longer time...

Infinitely Possible said...

Your underlying assumption is still one of capitalism: that we must STOP people from getting something for nothing! Which also has something like "people are lazy and won't work if they don't have to."

That assumptions will ultimately create the same issues that we currently have: scarcity will reign, people won't want to work unless compensated and will lead to other forms of class and caste issues like jobs classes.

I have a similar idea, but change the assumption to: people want to contribute and will find ways of doing that. Then we look at what excites people to work on and how they feel most like they are being of service. We might also need teams of people doing things they are not excited about, but the idea of getting to do what you want and have it counted is inspiring to me.

I don't think we need to focus so much on the punitive, or enforcement roles.

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The Emergence of The Relationship Economy
The Emergence of the Relationship Economy features TNNWC Founder, Adam J. Kovitz as a contributing author and contains some of his early work on The Laws of Relationship Capital. The book is available in hardcopy and e-book formats. With a forward written by Doc Searls (of Cluetrain Manifesto fame), it is considered a "must read" for anyone responsible for the strategic direction of their business. If you would like to purchase your own copy, please click the image above.

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