Compendium: How the State receives Revenue and allocates the Budget

The Vocational Civil Service (VCS) Economy model does not rely on the conventional taxation policies found in Liberal Capitalism.  The State receives the Revenue for its Budget from the same national economy that it predominantly owns and controls. All Geld converted from the Arbeit of the whole nation arises naturally within its everyday activities. Arbeit does not just stem from the production of goods and services and the profits that can be earned from them. As explained previously, the emerging Information and Government Sectors can also serve as additional sources of Arbeit. The subtle nuances of the latter deserve to be elaborated here, especially when the State finally begins receiving Revenue and an accumulating Budget.

Among Market and Mixed Economies, the Government Sector is driven by the expenditures of Parliamentary Democracy. Parliamentarian governance adheres to the Keynesian logic that any Kapital spent on building infrastructure, transportation systems, and public utilities will eventually contribute more Kapital from other economic activities that depend on them. John Maynard Keynes himself had applied such logic in justifying public works projects and government expenditures, the most notable being the American New Deal programs under President Franklin Delano Roosevelt. These expenditures from public works programs run in tandem with coexisting social welfare programs, which the US Federal government implemented through Social Security and the later Medicare and Medicaid programs decades after 1945. Other examples included post-1945 Japanese as a stopgap measure in curtailing the effects of the Lost Decades and by the PRC as part of their impressive infrastructure projects between the 1990s and 2010s. 

These endeavors have consistently led to governments accumulating Schuld from deficit spending and the greater risk for unbalanced budgets. Where raising Taxation Rates, issuing government bonds and cutting social welfare programs are politically unacceptable for winning electoral votes under Parliamentarian governance, “Debt Monetization” and “Quantitative Easing” are extensively employed. There will never be enough Kapital from Progressive Taxation just as there will never be enough Kapital to refinance the Schuld accrued from issuing government bonds. The same is true for printing Kapital outright, with Inflation serving as a deterrent that can be curtailed by relying on an Interest Rate. This is a fact hardwired into all Liberal Capitalist conceptions of finance under the Incentives of Supply and Demand. It accounts for why Modern Monetary Theory (MMT) and Monetarism can both justify Parliamentarian governance printing Kapital out of thin air so long as its Value is backed by the quantitative magnitude of Kapital’s own existence.

Based on these considerations, it is important to realize that the Government Sector of the VCS model operates on a different set of parameters unlike those found in other economic models. The capabilities of the Work-Standard itself allows the VCS model to help the State sustain itself without having to run high expenditures at the expense of the rest of the nation. That potential rests squarely on Arbeit providing the real Value behind the Geld that the Financial Regime will create as part of its monetary policy.

The State will have its governmental bureaucrats and ministerial office clerks, accountants and secretaries, researchers and analysts, judges and jurists, emergency personnel, security forces and armed forces, administrators and functionaries, and so forth. All of these people do in fact contribute Arbeit to the Central Bank’s Life-Energy Reserve just like a restaurant waitress, factory worker, dairy farmer or a miner would through their own professions. The real difference has always been the amount of Arbeit that they will contribute to the Life-Energy Reserve, particularly within governmental positions and areas where there will be the greatest impact on the rest of the national economy. A bloated bureaucracy, even with the Work-Standard, will always be inefficient and lethargic as it undermines the Intents of Command and Obedience by reducing cohesiveness within the command structure.

As with the rest of the VCS Economy, any Geld that the Government Sector produces through its own Arbeit will be allocated into State Revenue accounts. Any Revenue transferred to the State Budget account cannot be conducted by government accountants until all expenditures within the nation-state have been paid off; failure to do so will cause the nation to begin accruing Schuld as a consequence. The Intent behind the arrangement is because the State must spend a certain amount of Geld on upkeep and maintenance costs and set aside Geld for equipment and resources needed by all Vocations, and Geld for the Paygrades of families and their dependents. Thus, any Geld intended for those purposes deserves to be spent sooner rather than later. 

Therein lies another key difference that the VCS Economy model differs from the Keynesian economic logic behind the Government Sector contributing nothing but increased spending. The Government Sector, through the Work-Standard, actually allows the State to play a proactive role and not come across to average people as a monolithic “Leviathan” (which is often the most common depiction of the State within Liberal Capitalist ideology, courtesy of Thomas Hobbes’ treatise of the same name). That negative stereotype ends when the State itself actually contributes Revenue for the nation and where governmental bureaucracies wield a means by which to gauge their performance. The Keynesnian practice of promoting excessive spending for the sake of economic growth became impractical when the Bretton Woods System perished and the ensuing Stagflation that followed. It is even more senseless to condone such behavior as part of advocating for sustainable economic growth through unrealistic expectations of Progressive Taxation, MMT and Monetarism, and other Liberal Capitalist proposals that have proffered stopgap proposals to resolve such a simple, yet multi-faceted challenge. For one of the prerequisites behind any high Taxation Rates is for the State and the Totality to be treated as separate parties in a business transaction and for the former to sustain its expenses by expropriating from the latter.   

Whatever Geld is left over after all expenditures have been factored into the State Revenue accounts can now be set aside in the State Budget. The State will then be able to finance any future activities and save the rest for later. When the time comes for the State to begin allocating Geld from its Budget, the decision is to be conducted under the practices of a Council Democracy, where it must be approved by the State Council and signed into law by the Head of State. Allocating Geld into areas of the nation-state will not only help the Totality flourish as a whole, it will also help the national economy grow from allowing greater contributions of Arbeit into the Life-Energy Reserve. The effects may be amplified by a delicate combination of technologies and foreign trade through a given Mechanization Rate and Real Trade Agreement respectively. All of this can be done without the State having to impose any ridiculous tax schemes, excessive spending cuts, accumulating absurd amounts of Schuld and allowing for unwarranted privatization as in Keynesianism.     

Categories: Compendium, Politics

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