[p2p-research] Updated: All Work Is Created Equal (and other experiments)

[marc fawzi]

Hi All,

Re: discussion on "All Work Is Created Equal"

I've re-written the introductory sections to P2P Energy
Economy<http://p2pfoundation.net/P2P_Energy_Economy>in response to the
latest feedback, and I can't see much wrong with it in
theory but the model itself is very new and experimental, i.e. probably not
realistic at this time, yet still useful as an exercise (with key learning
objectives.)

Whether the model is realistic or not is not determinable through static
judgment, especially as the model continues to evolve based on feedback, and
it's probably time to start build a simulation with actual human users, even
just using a spreadsheet model.

People are most welcome to take the ideas developed so far and remix them as
part of a more realistic model.

The principles of the experiment have been updated per the following:

*~~

*All Work Is Created Equal

Technically speaking, in the P2P Energy Economy, tokens of the currency
(i.e. money) are created in proportion to the increase in the amount of
electric energy flow from nodes with energy surplus to nodes with energy
deficit, including households, charging stations, electric vehicle grid, and
neighboring communities, which is then converted by those nodes into new
work energy, which gives the tokens a real and absolute work value (in
joules) in spent energy, which enables its use in trading the goods and
services defined under this economy, at the cost of energy it takes to
produce and deliver them.

To restate this in plain English, it suffice it to say that in the P2P
Energy Economy all work energy is equal because all work energy is measured
using the same absolute-value unit, i.e. the Joule, so a dentist's work
energy is not any more valuable than a teacher's work energy, while still
allowing those who work harder (produce more work energy) to get more back.
In other words, it values all work energy equally while allowing people to
work as hard and smart as they are capable of and get compensated
proportionately, with increased sales and/or increased profit through higher
production efficiencies.

The conditions of sustainable abundance, given below, must be met for all
goods and services to be traded under this model. These conditions, when
combined with the currency defined under this model, enable a complete
departure from today's scarcity enforcing economic model by allowing
everyone who wishes to get a given good or service to do so at the absolute
work value of the energy it takes to produce and deliver that good or
service.
1. On-demand production (which permits predictive inventory management so
producers don't have to over produce, which causes waste and inefficiency
and is therefore unsustainable, or under produce which causes shortages and
high prices, which is also unsustainable) 2. Decentralized production (which
assures there's no dependence on a few suppliers) 3. Renewable production
(which assures there's no dependence on scarce resources) 4. Scalable
production (which assures that volume is not limited by the production
process) 5. Open source production and "share alike" licensing (which
assures that the good or service can be produced by anyone, while enforcing
social and moral rights of the originator, not their right to a monopoly.)

When the above conditions are met, for any given good or service, that good
or service should be available to everyone who wishes to have at the cost of
energy it takes to produce and deliver it.

So if health care (as a service) was to meet the above conditions then a
visit to the dentist should not cost more than what it takes in energy to
render that service.

The hard problem here is figuring out the energy costing models for the
types of goods and services that fulfill the sustainable abundance criteria
given above.

We can know how much it takes in energy (calories) per day to keep a 25 year
old human being functioning, and we can estimate the other costs of living
in terms of the work energy required to maintain living conditions. We can
also know the energy use of various processes used in producing and
delivering a given good or service. Assuming the given good or service meets
the above-mentioned criteria for sustainable abundance, i.e. no dependence
on scarcity economics, we can measure the energy it takes to produce and
deliver that good or service, and, using historical sales data, we can
adjust that eventually to be based on an average volume of production for
that good or service (instead of raw estimate) and then calculate the median
cost in energy it takes to produce and deliver that good or service, per
each instance of that good or service.

Such calculation involves building realistic energy costing models (for the
various goods and services that meet the sustainable abundance criteria,)
and when it's automated it via cost estimation software (as part of the P2P
trading application) it offers us the opportunity to understand the real
cost of production to ourselves and the environment.

When it comes to rewarding those who work harder and smarter, the model
fully supports that through two different paths:

1) Those who invest work energy in increasing the efficiency of their
production processes get to have a profit margin (because their good or
service costs less than the median cost in work energy to produce and make,
so they get to keep the difference.)

2) Those who invest work energy in improving an existing good or service get
to sell more of that good or service if they select the right improvements
(but also get to lose if they select the wrong improvements, so this second
path involves educated risk taking.)
[edit<http://p2pfoundation.net/P2P_Energy_Economy?title=P2P_Energy_Economy&action=edit&section=8>
]
Work Only If You Love Your Work

The result of trading in goods and services at the cost of work energy it
takes to produce and deliver them is that, unless one manages to produce and
deliver the good and service with less work energy than other producers of
the same good or service, producers will get back the same amount of work
energy in joule tokens as they put in. And since people can sell their own
produced energy, goods or services for joule tokens at the work value of
energy and at cost in work energy it takes to produce and deliver those
goods and services, respectively, and use those joule tokens to get the
goods and services they need at the cost in work energy it takes to produce
and deliver those goods and services, they can go on living indefinitely
without the need to generate 'profits.'

Therefore, the thirst for artificial motivation in the form of profits (i.e.
greed) is out of the picture, which means that people will only do the work
(to produce and deliver a good or service) if and only if they love the
work.

It also means that, since no one has to work unless they love their work, no
one will need -or have any incentive- to work for another person, which
means that most people will be both consumers as well as producers of goods
and services, or "prosumers.
[edit<http://p2pfoundation.net/P2P_Energy_Economy?title=P2P_Energy_Economy&action=edit&section=9>
]
Things Cost Less Over Time

Given continuous technological progress, work done today should take less
energy to do in the future.

While that's true for the current economy, the P2P Energy Economy channels
the profit motive (or greed) into achieving higher and higher efficiencies
in the use of energy (in producing and delivering products and services,)
since that is the only way profit can be achieved in the P2P Energy Economy,
so given the currency does not lose its work value in energy more and more
can be purchased with less and less currency.
[edit<http://p2pfoundation.net/P2P_Energy_Economy?title=P2P_Energy_Economy&action=edit&section=10>
]
Good Things Come to Those Who Care

In today's economy socially, environmentally and ecologically conscious
producers of goods and services are beginning to see increased sales, but
only in very limited niches and local markets.

In the P2P Energy Economy consumers identify, as part of each purchase of
goods or services, the required attributes (for the given good or service)
as well as their social, environmental and ecological values, which allows
them to find producers (of the given good or service) who support their
values. This means that money flows more in sync with society's values.
[edit<http://p2pfoundation.net/P2P_Energy_Economy?title=P2P_Energy_Economy&action=edit&section=11>
]
The More You Share, The More You Have

In the P2P Energy Economy, in order for producers to grow their revenue they
have to share it with others.

The way it works is by rewarding producers who lend money to others (with no
interest) with bigger access to the market, such that the more they lend the
bigger their to the market.
[edit<http://p2pfoundation.net/P2P_Energy_Economy?title=P2P_Energy_Economy&action=edit&section=12>
]
Increased Autonomy Through Increased Inter-Dependence

In the current economy, reliance on one or few major players in each given
market has created an unsustainable system. When the top 2 or 3 investment
banks in each country failed the entire global financial industry collapsed,
which has caused the global economy to falter (search: global economic
meltdown 2008.)

In the P2P Energy Economy, increased autonomy is achieved by putting power
with the whole rather than with one or few major players.

The current economic meltdown (search: global economic meltdown 2008) is a
proof that we have reached or are reaching the limits of sustainability for
the current economic paradigm, and that 'peer production' (the production of
energy, goods and services by individuals as opposed to utilities and
factories,) will make the system dependent on the people as a whole, instead
of on one or few major players, which, as we can see, based on the current
paradigm, makes the people dependent on the system and renders them helpless
in times of instability, thus perpetuating and even deepening their
dependence on the system.

The key concept behind the P2P Energy Economy is that it replaces increased
dependence by the people on the system (i.e. on the major players) with
increased inter-dependence between equally empowered peers, which puts the
power with the whole and allows both the individual and the system to enjoy
true autonomy.

Monopolies are eliminated in the P2P Energy Economy due to the following
conditions:
1. All goods and services must meet the following criteria for sustainable
abundance: a. On-demand production (which permits predictive inventory
management so producers don't have to over produce, which causes waste and
inefficiency and is therefore unsustainable, or under produce which causes
shortages and high prices, which is also unsustainable)  b. Decentralized
production (which assures there's no dependence on a few suppliers)  c.
Renewable production (which assures there's no dependence on scarce
resources)  d. Scalable production (which assures that volume is not limited
by the production process)  e. Open source production and "share alike"
licensing (which assures that the good or service can be produced by anyone,
while enforcing social and moral rights of the originator, not their right
to a monopoly.)  2. Consumers are automatically and anonymously matched to
producers based on the required attributes for the given good or service and
the affinity between the consumer's and the producer's social, ecological
and environmental values. *
*~~

http://p2pfoundation.net/P2P_Energy_Economy

Thanks again for all the debating and feedback.

Marc
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