The RoboEconomy and ExtraEconomy Part 1

People will wonder what to do now, with the prospect painted by the IPCC. The predictions are dire, we all know it and actual reality seems to move quicker than most models predict. What to do if you are in a normal job with a wife and kids and a mortgage..

Humans are not made to change things when everything seems fine. Everything seems fine, except a couple of hot days, maybe a storm and a forest fire if you are unlucky. Its very hard to throw everything overboard and its not even clear if that would make any sense. You may have worked years to achieve your current position, or your current level of excellence and expertise, and now it seems there is a risk that needs to be neutralized, and it requires big changes.

Two new concepts

Before we get into how things will go down lets talk about the title of this piece. The RoboEconomy and the ExtraEconomy first. The two terms where made up to signify two systems in the world dealing with climate change. One is as system a lot like the one we call our economy today, the other is one which is explicity out of reach of that system. The RoboEconomy is simply an economy that uses robots and renewables instead of fossil fuels while maximizing jobs.  The extraeconomy consists of climate mitigation projects that are generating resources that are NOT to be consumed in processes that are NOT to be interrupted. Ever in some cases.

The question is how to move from our current economy to the RoboEconomy, how to start the projects of the ExtraEconomy (So called Millenium projects) while still having a reasonable life, or one that is pleasant and exists at least. How fast can that be done is also an imporant question. Also what needs to be done. The scale of the problem is underestimated. It can become effectively unsolvable in the next thousand years.

Humans may find a way, but how many and what about the rest of life?

To be sure, the world still looks really nice in most places, some are seeing forest fires, some are seeing melting of snow and ice, things are changing, but you can live. And if you take human ingenuity into account, and assume we will keep access to technology on the current scale (which is unlikely) then we will find ways to adapt, even in the absolute worst case scenario of a hot house earth with H2S in our atmosphere. Then we will likely also live on the Moon and Mars and Space in an orbit around Earth.

The above is technological optimism, It applies correctly to the survival of a small part of the current population in the extreme scenarios. It is nothing to be elated about, like the techno optimism preachers hope for in their following. The singularity as a concept but also a tool for mass hynosis. They want you to buy the books that tell you humans invented so much so we will surely invent a solution to climate change. Maybe. But in reality our expectations should be much more modest, because those preachers don’t create or imagine technology, they just talk about it. It is hard to make technology, it is hard to deploy it. So the baseline for succes is survival of people, fixing climate change is going to be a millenial challenge.

What we experience influences our behaviour

Back to the lives of everyday people, the Roboeconomy and Extraeconomy. Perhaps the most important aspect of our economy is its media. The media constitute a datastream that shapes and controls our minds. Social media is a part of that. It occupies part of our mental capacity and it provides examples of behaviour that we subconsciously immitate to understand, so which can become part of our behaviour quite easily. They create an illusion of stability, like an environment, but an artificial one where the relative amount of attention ideas and events get does not mirror any practical need for it. To the media, including the social media, your engagement with it is being maximized. Through that engagement your behaviour can be influenced, and this is an ability that has value in the economy. Time spend with media is time spend with little return, and it is likely to lead to more time wasted. Wasting consumer time is on average good for the economy. It makes us more needy.

Money has become our significant other

The second most important aspect of our economy is money. The primary goal of the economy is to make us fully dependent on money. Its goal is to “install” money as our primary driver. To achieve this it needs to turn anything we pay attention to into a product or service. The drive to do this comes from four sources :

  1. Someone wants to exchange a product or service with you, but there is no immediate need for it, so money is used to bridge the time difference
  2. Someone wants to make money of selling you something you already have or considered of little value.
  3. Someone handling the money (a bank) wants to handle more money.
  4. Someone selling primary resources like fossil fuels wants to sell more fossil fuels.

We need to clearly separate these motivations, because some benefit all and others only a few.

Money is an organizational tool

Motivation nr. 1 is the real reason we have money, to organize our activities over time. Even gold as it was used in ancient times functioned to motivate a person to do something at the chosen time, and the amount was of course related to what that person knew another person would do for the same amount. A person would not do more or less than he expected someone else to do unless other circumstances compelled him/her to. Motivation nr. 1 is so true that if you have a group of people now cooperating in some way you can easily introduce a currency to do the above. This offers everyone freedom and flexibility, but also introduces the risk of inequality.

Money can be used to achieve egotistic outcomes

Of course it is clear that money in the sense above can control people. And if we have control over things it is more likely we achieve outcomes we desire, so money becomes a thing of value to hold irrespective of its exchange value. This introduces egotism in the social system, something that would be much harder without money, there egotism can only be realized through action by the egotistic person, which requires effort and is thus an exchange within the person him/herself. Gaining money to gain power and control is synonymous with profit seeking. In a normal society with money in circulation profit could never be excessive. But as money is a token that is introduced, and the amount of money is arbitrarily controled by those that coin it, the amount of profit and the meaning of profit can become hard to define.

Moneylenders and creators have taken extraordinary control

Motivation nr. 3 combines the control motive with the extaordinary privilige to create money. This is what banks can do today. They not only handle our money, they create it. Their motivation is entirely based on control and profit seeking. They do not form a basic part of a functioning society of equals, they have placed themselves above it, and because they usually behave very decently, most of us are unwilling to accept there’s anything wrong with that. Of course normal desire for safety and security drives banks to try to gain more control. Banks control our money supply and can simply decide to cut it or extend it or make it more expensive or less expensive. Because of that they can grab control of assets, drive up prices, create false competition and distort markets. To say however that profit seeking banks are something we should or could eliminate today would be wrong, and this has to do with motivation nr. 4

Our money is fossil fuel credit

Not all producers of primary resources are equal. Oil, coal and gas are both raw materials for plastics and other chemicals but also the source of energy we use to manipulate, facilityat and create our products and services. What’s more some countries depend heavily on fossil fuel sales. Saudi Arabia has a barrel price for crude oil in mind that maximizes sales and their revenue. This implies that there is a constant pressure to sell oil, to use it in as much situations as possible. If we could suddenly fly electric oil companies and oil countries would have to find a new use for their oil or go broke! Banks have a strong interest in this process, because they handle the money that is used to buy and sell oil. Their ability to create money amounts to taking oil from the producers at will, and thus in spite of what they say there needs to be an understanding between oil producers and banks, and this is having serious consequences in the fight against climate change. Money in this role is “carboncredit” and its cashflow is the oxygen for banks.

Fossil fuel credit is special

Fossil fuel credit as described above does not obey normal rules of exchange. It is easy to see that if Saudi Arabia produced all the oil the world had, it would profit so much from selling it it could basically buy a large portion of whatever is produced with their oil This is clearly not the case. This is in part a result of banking tricks, books have been written about how Wallstreet disappeard much of the Saudi wealth. But more fundamentally fossil fuel does not fit in an economy that exchanges human productivity and results of human skills. We burn oil. Oil is like a crop that grows without a need to tend it (much). But unlike real crops no person can make oil. On the other hand for millenia nobody had any use for oil. The egyptians had tar and oil and used it to waterproof boats and burn in lamps, but other than that they didn’t care about it.

It took a century of increasing our use of fossil fuels to reach the point where we are now. It was a self amplifying process and it would be foolish to deny that the lives of people improved. But today the primary method of this “economic expansion”, namely fossil fuel credit, means the tool we use to organize our activities is tied in for 100% with an energy source we can no longer afford to use. Our money and the way we create it is fundamentally expecting the availability of fossil fuels in the market. The easiest way to see this is if for instance a bank finances some new waterworld amusementpark. The money will go towards buying resources. But how come they are available? Because the money buys the fuels to create the cement, haul the concrete. That’s a lot of energy needed to do all that. Would that energy be available if we only used solar and wind (and some battery storage) ? Nope. The energy production capacity would have to front run any development and as a consequence any ability of a bank giving credit. Oil, gas and coal are stored energy, and this is what makes it possible for our bank to say “Here is 1 million go ahead and buy and use that oil”. With renewables they could only do that if they owned stored energy, or the energy source. And with renewables this would not be an exclusive privilege of banks! Our money is fundamentally pro fossil fuels.

To be continued..

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