THE UNIVERSAL ECONOMY – UNIT I: CONCEPTUALIZING THE POSSIBLE
Where sovereign nations with sovereign currencies are concerned, asking “how are you going to pay for it” is always posing the wrong question. It automatically introduces artificial monetary constraints due to flawed manmade economic premises, and societies are invariably told “there isn’t enough money and they must do without.” The real question is, “do we have the resources, energy, manpower, and knowledge to provide for societal needs?” At 21st century levels of human knowhow, the answer to this question is virtually always “yes.” This is economic thinking based on the laws of the Universe. It is the Universal Economy.
For billions of years, planet Earth has been voyaging through the Universe with its star, the Sun, and its galaxy, the Milky Way. Humanity has been onboard just a few million years. In the Universal scheme of things, we are but a hint of dust. The Cosmos will neither know, nor care, if we survive. But this is our journey, Spaceship Earth is our home, and we can choose to be a Universal success.
However, we are not going to accomplish this by continuing to operate with manmade economic ideologies having little correlation with physical reality. Much of what we have been taught to believe must be discarded. Adding a sense of urgency, global warming, manmade planetary systems collapse, and self-inflicted nuclear annihilation threaten to leave humanity a Universal failed experiment.
The first step in aligning our manmade economic theories with physical reality is to develop a clear understanding of the difference between true, life-sustaining physical wealth, and the medium of exchange we call “money.”
One cannot eat money. It cannot be used as clothing. A house or chair cannot be built out of money. One cannot ride to work in a dollar bill or use it to mow the lawn. This is because food and clothing, a furnished house, a car, and a lawnmower are wealth. Money is the claim to wealth, a medium of exchange accepted as valid by a society. It has no value in and of itself. In fact, the overwhelming majority of “money” doesn’t exist. It is simply an entry on a computer screen at the U.S. Treasury, a local bank, in a stock or bond investment, or in a tax avoidance account in the Cayman Islands. But the manipulation of money exerts great power over the availability of wealth and who has “legal” claim to ownership.
Unlike money, wealth absolutely exists. The components of wealth are physical resources – matter and energy – and the current level of human knowledge available to convert these physical resources into life sustaining goods and services. Simplistically stated:
WEALTH = (MATTER + ENERGY) X HUMAN KNOWLEDGE
This equation is why knowledgeable humans can mine iron, chromium and nickel ores from star-gifted deposits on planet Earth, melt them together in an electric furnace, and provide us with true wealth – – – the stainless-steel fork, knife and spoon we’ll use to eat supper this evening.
At the risk of becoming boringly technical, the First Law of Thermodynamics states the total amount of matter and energy in the universe is constant and can be neither created nor destroyed, only interchanged. Referring to the above wealth equation, since matter and energy are constant and human knowledge can only grow, wealth can only grow.
It is true that energy stored in fossil fuels is unavailable after the fuels are burned. However, human knowledge now makes it possible for humanity to operate on Earth’s energy income using solar, wind, tidal, biofuels etc. Only a lack of political will and the resistance of the fossil fuel industry prevents us from doing so.
It is critical to note that wealth can be applied productively, enhancing the human condition, or counterproductively, harming the human condition. One example of counterproductive is weaponry. War is ultimately about who can claim ownership of productive wealth artificially limited by misguided monetary policy. Wealth wasted counterproductively waging war further reduces available productive wealth and the result is a downward spiral. However, we can choose an upward spiral. By aligning our man made economic thinking with the laws of physics, we can lay the path to ongoing human success.
Unit II will discuss: FIAT MONEY