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Value, Utility and an Energy Economy

by ChrisCook Sat Feb 16th, 2013 at 10:34:23 AM EST

The following quote on a thread piqued my interest and the response which follows below the line.

Value is always subjective, utility objective. Utility acquires value only if by becoming scarce, someone will pay for its provision.

In my analysis, Value - like Beauty, Quality and many other concepts - is an aspect of Reality and may be defined only in relative terms by reference to a standard unit of measure of Value or 'unit of account'.

NB: one can no more have a scarcity of units of account than one can have a scarcity of kilogrammes (standard unit of measure for weight) or metres (standard unit of measure for length).

A scarcity of currency, on the other hand is necessary - we are told by most economists - for that currency to maintain its value.

My somewhat sprawling response builds upon my metaphysical assumptions that the three sources of Value, through their utility over time, are:

(a) Location - immaterial 3D Space;

(b) Energy - material (static) and dynamic forms;

(c) Intellect - (subjective - which dies with us) and objective (data patterns).


Location/Land has utility and its limited supply and rivalrous nature (ie you can exclude people from it) is what makes it valuable. So a 'prepaid rental' credit returnable in payment for the use of land/location is a good candidate for a geographically acceptable currency.

Material energy (matter) embedded in location and kinetic energy passing through a location also have utility, and a rivalrous nature and are therefore valuable. A prepaid energy credit returnable in exchange for the use of energy (eg a carbon fuel credit; or an electricity credit or a heat credit) are different forms of energy currency which would be more or less universally acceptable in exchange.

Finally, 'Intellect' has utility and its use over time is valuable.

Historically intellectual value resided purely with the (rivalrous) individual, and was and is the sum of experience, knowledge, intuition, creativity, contacts, common sense, skills - and above all, the (currently poorly valued) love, care and empathy which sits between our ears and is what makes our manpower (energy) subjectively more valuable to our employer or counter-party. ie if you combine energy and intellect you get classical economic factor of production 'Labour'.

Now, Intellectual Property, in the form of patterns of data in material and immaterial form, also has utility which gives it a value which is growing at a truly phenomenal rate. The reason that the existing order is breaking down, and that the steering wheel has come off in the elite's hands is that IP is non-rivalrous, because once it has been communicated or transferred it is impossible to take it back.

In my analysis, there will be at least two 'Big Trades' of the 21st Century.

Firstly, we currently see on the one hand a wealthy generation which is 'long' of Land/Location, but increasingly 'short' of care for the land and for themselves as they age: while on the other hand we see an impoverished generation which is short of Land but long of Care.

So the Resolution Trade will be the direct exchange of care credits for rental credits, cutting out power-seeking (and rent-seeking) government Public Sector middlemen and rent-seeking Private Sector middlemen.

Secondly, the Transition Trade which will enable a low carbon economy is the direct exchange of the value of Intellect and IP for the value of carbon fuels saved. ie nega watts, nega litres and nega barrels.

As the guy said, software is the new oil.

But in order to make value judgements in exchange transactions, we need an objective and relevant standard unit of measure for value (unit of account). In my view this must logically be the only absolute there is ie a standard unit of energy. And here I must - finally - disagree with you, since energy always has utility (and hence value), even if it is freely available.

ie the economy of abundance now dawning will be an economy based upon an intrinsically valuable energy standard of exchange - as opposed to standards of exchange such as gold or the 'fiat' $ , which have no intrinsic utility. Based upon such an energy economy of abundance we will see the flowering of human intellect, care and love.

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Based upon such an energy economy of abundance we will see the flowering of human intellect, care and love.

Unless political power is forcibly - cuz they ain't gonna give it up willingly - taken from the sociopathic PTB this is nothing but a pipe dream.  And if the power is taken from them, unless some kind of Bottom/Up system is put in, the odds are The Revolution© will end-up swapping one group of sociopaths for another.

Skepticism is the first step on the road to truth. -- Denis Diderot

by ATinNM on Sat Feb 16th, 2013 at 01:33:35 PM EST
Firstly, as for control, the PTB have lost it because the Internet routes around them.

They will simply wither on the vine as people consensually adopt:

(a) Peer to Asset investment and currencies based upon prepaid use value of productive assets held in common; and

(b) Peer to Peer credit creation and clearing - within a mutual framework of trust (and which is nothing whatever to do with Peer to Peer interest-bearing fiat currency debt).

Not only is there nothing the PTB can do to stop this, is it actually in their interests to dis-intermediate. Public sector/state intermediaries minimise tax, while private sector intermediaries minimise finance capital,

This transition is a reality: the whole point of the >$3 trillion Exchange Traded Fund etc industry is that the market risk is not with the middleman, but with the investor.

"The future is already here -- it's just not very evenly distributed" William Gibson

by ChrisCook (cojockathotmaildotcom) on Sat Feb 16th, 2013 at 07:25:18 PM EST
[ Parent ]
as for control, the PTB have lost it because the Internet routes around them.

That is the common wisdom.  I note it is a prediction.  The TPTB have been exhibiting capability to close down or shunt-to-zero Internet association and relational paths at telephone switches, etc., when they chose.  Thus I think the prediction is wildly optimistic.

Peer-to-Peer Economy

TPTB can shut it down any time they bother to make the effort by having their toadies pass laws making effectively illegal and/or erecting so many barriers it is effectively impossible.  At the moment groups like KickStart are no threat.  If it does, then they will take action.  Look at WikiLeaks and how quickly and easily their funding was cut off.

Skepticism is the first step on the road to truth. -- Denis Diderot

by ATinNM on Sun Feb 17th, 2013 at 04:26:41 PM EST
[ Parent ]
I repeat.

It is in the interests of financial intermediaries to dis-intermediate because this minimises their capital requirement.

That is why they are doing it. That is why there are $3 trillion - yes trillion - in exchange traded funds where market risk has been outsourced to investors.

Capitalism is eating itself.

"The future is already here -- it's just not very evenly distributed" William Gibson

by ChrisCook (cojockathotmaildotcom) on Sun Feb 17th, 2013 at 06:26:57 PM EST
[ Parent ]
This is going nowhere.

Skepticism is the first step on the road to truth. -- Denis Diderot
by ATinNM on Sun Feb 17th, 2013 at 07:00:25 PM EST
[ Parent ]
ChrisCook:
It is in the interests of financial intermediaries to dis-intermediate because this minimises their capital requirement.

That works only as long as that is their priority. As we can see in the current crisis raw power can be put above all other considerations.

ChrisCook:

That is why they are doing it. That is why there are $3 trillion - yes trillion - in exchange traded funds where market risk has been outsourced to investors.

This is a measurement of success. But how much would this be as a percentage of the traditional model?

A vote for PES is a vote for EPP! A vote for EPP is a vote for PES! Support the coalition, vote EPP-PES in 2009!

by A swedish kind of death on Mon Feb 18th, 2013 at 03:18:40 AM EST
[ Parent ]
Continued economic growth is hard-wired into the corporate world, and the corporate world pulls the strings of today's governments. But continued economic growth is impossible with existing levels of conventional finance capital, which is why investors are moving to the adjacent possible of quasi-equity ETFs and so on.

When these funds fail, having ironically caused the very inflation they aimed to 'hedge' - ie when the current asset bubbles end - investors will move on again to the next adjacent possible, which is already discreetly in wholesale market use ie Prepay.

This completes a 'Back to the Future' circle - since prepay instruments pre-date modern banking - to the Last Big Thing of direct 'Peer to Asset' investment.

The US National Debt is over $11 trillion, so $3 trillion is getting on for 30% of that. Most of this money is swilling across from the $trillions in 'Money Market Funds' now getting negative real rates of interest.

"The future is already here -- it's just not very evenly distributed" William Gibson

by ChrisCook (cojockathotmaildotcom) on Mon Feb 18th, 2013 at 06:50:19 AM EST
[ Parent ]
See also, the Great Firewall of China.

It's a leaky firewall, but it's not leaky enough to define Chinese domestic policy.

by ThatBritGuy (thatbritguy (at) googlemail.com) on Sun Feb 17th, 2013 at 06:39:35 PM EST
[ Parent ]
I know TPTB means The Powers That Be but I can't help reading it as Too Pig to Bail.

I distribute. You re-distribute. He gives your hard-earned money to lazy scroungers. -- JakeS
by Migeru (migeru at eurotrib dot com) on Sun Feb 17th, 2013 at 09:11:56 PM EST
[ Parent ]



"We can all be prosperous but we can't all be rich." Ian Welsh
by melo (melometa4(at)gmail.com) on Mon Feb 18th, 2013 at 05:28:09 AM EST
[ Parent ]
visionary and inspiring, good diary.

i think if we have the patience to attend the Great Unwinding, the rewards will be many and great.

what we see now daily is the end of an Era of Ignorance.

the control of Big Energy right now is in the hands of proven sociopaths, and we have studiously avoided righting the great wrongs the Industrial Age has wrought on our habitat, notwithstanding our knowledge, indeed we are expanding the insult. apparently clean energy sources are still less than 1% compared to fossil fuels (citation needed), and yet those too powerless to do anything significant have known the agony of loving a planet, inhabited by greedy and gullible fools for the most part.

their system, so lovingly cosseted and trumpeted as the sine qua non of civilisation even as millions groaned under its whip to provide luxury for the selected few, selected not for compassion flexibility or even intelligence, but for rapacious, genocidal-if-necessary cunning.... it's doomed.

every stupid choice we have ever personally made since we could make our own choices has contributed to the tsunami of stupid that is now leveling peoples' lives, we are somewhat complicit, and that knowledge can hold us back instead of spurring us to help the great atonement we need to make to mother earth.

we wanted this.... and it's way past late to affirm something better worth dying for, because the way things are going, a happy retirement of pleasure and relaxation is not what's waiting for many many people, and there are hordes of european and american folks convinced they/we have a right to live better than the chinese, as if history justified it in some way, like it was written in stone, just because we had bigger guns when the country lines were drawn.

these old rationales for exceptionalism are stamped deep into our collective psyches, and do not uproot easily.

the neolib thrust to commidify the very air we breathe until the air is no longer breathable is a wound, a trauma embedded deeply into the acquiescence we have inherited, along with the indoor toilets, i-gizmos and celebrity worship that make us feel cooler and sexier than our ancestors, who died like flies in childbirth or early youth, leaving only the toughest to breed, (and the craftiest to rule).

this learned helplessness has rendered most people relatively mindless, and easily engineered into believing black is white and up is down.

just fill them with mystery meat and enough brain-dulling drugs, they will be the docile cattle needed to go through the motions of a life, meaning and purpose supplied by sports fandom and status markers.

as a species we are at the stage of a 2 year old boy, playing with his dick with a stupefied expression on his face, unfortunately this same capricious, self-absorbed child has figured out how to lay waste to whole biospheres with the click of a mouse.

one has to wonder whether this child will ever grow up and  get a clue...

after pondering this magnificent tragedy as consciously as possible for many decades now, what stares out at me as the only non-violent way forward has been to seek lives of meaning that required the minimum inconvenience for the environment,  i envied those tribes who still drew all their sustenance from their habitats, leaving them for hundreds of generations in fine form for their descendants... they seemed models of karmic purity, they didn't grow up listening to commercials telling a million lies, infected by the ruthless, cruel logic of 'the markets', bending their brain cells into new cognitive dwarfisms as they slowly, inevitably acknowledged at core level that their existence depended on the the game of 'fuck the planet for profit' continuing, through sheer info-osmosis.

it's the energy. stupid!  the shortest way from A. (present misery) to B. (the society of carers Chris depicts).

knowledge is sadly not power, it just acts as a necessary immunity-booster to the culture of bullshit jammed down our mediated throats.... a badly needed prophylactic.

the approach to value Chris's diaries offer is hard to conceive, yet i don't think it would be that hard to explain to a kalahari bushman, as his mind has less blocks to understanding, less axioms to exhume... if any!

energy is worth something intrinsically, it's not just a symbol. it's value is unequivocal, you either have enough or you need a top-up.

societies that confuse symbols for reality cannot be trusted to find their way to somewhere good, as we all can see unfold.

the question that remains is will the titans duke it out (watch out for flying debris) till there are none left standing and the shire folk can take over and do it right, or will enough people dying in public from 'unfortunate financial events' finally shame enough people into learning something from history before repeating the worst of it, with newer, more toxic toys?

in this day and age it is a shame, therefor shameful, to remain ignorant, it's like we are swimming in reality and still believing what the suits on the screen say is happening over the evidence.

it is the supreme subversion, to envisage a better world of love instead of hate, and i heartily applaud Chris' efforts to make it happen. his channeling Pirsig is a nice extra...

thanks for keeping the faith Chris and good luck on your mission to re-explain the forces of cause and effect in a wiser way than we have become used to.

"We can all be prosperous but we can't all be rich." Ian Welsh

by melo (melometa4(at)gmail.com) on Sat Feb 16th, 2013 at 03:29:11 PM EST


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