[NB: This post is intended to be the first post to the Substack extension of The Fourth Estate. It is meant to introduce new readers on Substack to the details of the Work-Standard and the current state of the research. I purposely kept it short and simple for the sake of elucidating interest. -DAH]
Overview
The Fourth Estate is a website dedicated to realization and implementation of “Fourth Estate Policy,” an alternative financial system revolving around the “Work-Standard.” The Work-Standard is the revolutionary idea of backing a national currency with the naturally occurring production of “Arbeit (Work),” which is created from all manner of economic activities within a nation. A national economy produces Arbeit from the harvesting of natural resources, the manufacturing of everyday products, the rendering of services to interested customers, the facilitation of computers and machinery, and the performance of official functions of government. Anything capable of creating Arbeit has the potential to yield “Money (Geld),” providing wealth to the nation that can be reinvested into the economy to create more Arbeit.
The terms “Arbeit” and “Geld” are significant insofar as their metaphysical and conceptual essences differ from the two entities that they are meant to overcome, namely “Capital” and “Labor.” Rather than being based on the activities of a specific segment of the population, the true value of Arbeit stems from the Life-Energy that the entire nation contributes to the national economy. And unlike Geld, Capital’s continued existence relies on the proliferation of “Debt” and the willingness of the people to service that Debt with differing conceptions of currency. As far as those with Capital are concerned, Labor is a redundant liability.
It is because of the conflicts between Capital and Labor that the concept of the Class Struggle becomes entertainable. Those possessing Capital could not have earned it without spending their way into some form of Debt that they may or may not be able to pay down anytime soon. Those not possessing Capital, Labor, want a larger share of Capital because they too have their own Debts to pay down as well. The frictions between those who have Capital and those who do not resulted in both sides turning to the national government to level the playing field. To resolve those frictions, governments introduced taxation and social welfare policies to redistribute wealth between the two groups. It was always a winners-take-all arrangement that could never be guaranteed to last, impoverishing one group and enriching the other at government expense. Never did those policies benefit everyone and their government as part of the nation for the benefit of the nation.
There is a hidden crisis within economic life, its well-intended consequences rippling across the political and the social life of the nation. It lies beyond the dialectical debate between “Capitalism” and “Socialism,” “Fascism” and “Communism.” The Work-Standard dares to bring that crisis into the limelight, offering a revolutionary alternative worthy of confronting it.
The Crisis of Modern Economy
Most people do not think too deeply about this, but so much of everyday economic life is centered around the creation of Debts surpassing Capital. Entire nations strive to reap the most amount of Capital with the least amount of Debt. What passes as “economic growth” is defined by the spending of Capital to gain Capital. It matters very little how someone acquires Capital; what matters is whether they have Capital. Instead of being defined by Work as the end in itself within economic life, “Wealth” is measured by how much Capital someone is capable of possessing. As far as Capital is concerned, Work is just a means to its own end, even though Work itself is capable of becoming antithetical to Capital.
This fundamental contradiction between Work and Capital can be ascertained across different sectors of the nation. What do each of the following cases have in common?:
- In the educational system, people are not taught the ways of creating new Work for themselves and for others. They are instead swayed by the Capital that comes with completing their education. The only problem is that they cannot always expect the economy or the government to provide employment. Opportunities for the educational system to work with the economy and the government to promote prosperity are absent.
- In the national economy, businesses struggle to provide employment in a world where Labor is increasingly becoming redundant due to the mechanization and automatization of economic activities. Competition in the Market is characterized by businesses squabbling over tiny scraps of Capital that they receive from a variety of sources. Never does the Capital come from their own activities, independent of the Market in which they operate. Oligopolies and Monopolies form because businesses have a desire to survive by subsisting on Capital, becoming no different than the people who have to subsist on the social safety net because the government was forced to intervene.
- In the financial system, banks are incapable of creating their own sources of wealth without compelling people to borrow Capital in exchange for Debt at predetermined Interest Rates. Financial markets also do not create their own sources of wealth since they are vehicles for redistributing wealth between investors and businesses. Stocks and bonds do not create Capital on their own; that Capital has to come from somewhere, like the coffers of a particular business.
- In the national government, its basic functions are so expensive that it is incapable of sustaining itself. Taxes could be raised, spending can be cut, loans and bonds might be offered, and certain functions may be privatized or businesses nationalized. In each of those cases, the government is taking Capital from somewhere and not creating Capital on its own.
- In the digital realm, questions of personal privacy and national sovereignty have emerged due to concerns over the collection of information for advertisers and data analytics firms. This trend is fueled by similar concerns that not enough wealth is being reaped from the activities conducted in the fledgling digital economies of different nations.
All five of those cases describe instances where “Wealth” is literally occurring from the extraction of existing Capital. There never is enough Capital in existence for anyone, not even for the wealthy or their nations. The Capital could be denominated in gold and silver, coins and banknotes, and cryptocurrencies and there still would not be enough Capital to sustain a nation, let alone the entire world. Technologies could be developed to facilitate further Capital creation, but in the end, there will always be a growing abundance of Work that needs to be done.
This is not exactly an issue of Inflation, Usury or Rent-Seeking, although they are related to the overarching problem at hand. If anything, they are just complications that come with relying on Capital. Instead, it has been an issue of what exactly constitutes “Wealth” in a world where natural resources are limited, human potential is limitless, and where Work creates its own conception of “Wealth” that can someday provide the basis for a new currency system.
Work contra Capital
The tremors among the national economies of the world are not represented by two groups of people within a nation. They may be the most visible manifestations, but they are not the actual causes. The real conflict is being shaped by two opposing definitions of what constitutes “Wealth” in contemporary economic life, namely Work and Capital. These opposing definitions become self-evident in the conceptualization of equally opposed conceptions of currencies.
On the one hand, there is the idea of a “Work-based Currency” where its value is backed by the quality of various economic activities conducted in the nation. The educational system, national economy, financial system, national government and digital realm are all equally capable of sustaining themselves and creating new “Wealth” just by doing their Work. How well they devoted themselves to their Work, how often they were committed to that Work, and how much Work they contributed determine the valuation of the Currency.
Under this Currency, the Works of the entire nation are to be converted into Money, which is then allocated throughout the nation by the financial system at the behest of the national government. While some are going to spend Money on everything they need, others are reinvesting the Money to create additional sources of Work. The most valuable Works are those which will result in the overall flourishing of the nation.
Contrast that Currency with the conventional forms of Capital, such as gold and silver, coins and banknotes, and cryptocurrencies. None of them have their values determined by the actions of the people who ultimately depend on them in their everyday lives. For the value of Capital was fixated on the sheer quantity of its mere existence and its ability to be exchanged in transactional sales. The less Capital there was in existence, the more valuable it would become; the more Capital there was in existence, the less valuable it would become.
The purpose of the Work-Standard is to explore the possibility of an alternative currency system where Wealth is defined by the creation of Work and its subsequent conversion into Money that could then be reinvested to create more Work. Research into the Work-Standard has taken an entire decade and two years to articulate into something tangible, yet practical. As of this writing, there are currently four Treatises devoted to it and its related topics.
The Treatises are already complete, but future editions remain forthcoming. The Work-Standard (2nd Ed.) will most likely be the first to be given the most attention, as it is the one that laid out the general theories and concepts for the other three Treatises. Someday, a third edition will be written to address some of the limitations associated with the first and second editions.
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