A banker offers you a loan so that you can buy a house located near your cushy new job. You sign, comfortable that your salary will allow you to afford the payments. Months later, your employer downsizes, and your job disappears. With no job, you can’t pay back your loan. But the banker’s not upset — in fact, he was hoping for this. As you miss payments, your interest rate goes up. You need a new job to pay your increasing debt, and conveniently enough, the banker is the only one in town hiring. This is the crux of the issue with the profit motive: those who profit can put harmful pressure on others.
At its core, profit is power. Whether it takes the form of having many coins, being owed many debts, or something else entirely, profit is a measure of one’s ability to get other people to do things. By giving a merchant money, I can get her to give me her product. By reminding my friend of all the favors I’ve done for him, I can get him to do me a very large one. I gain these abilities through profit.
As I’ve tried to drive home, this is a perfectly reasonable thing to desire, and a perfectly natural thing by which to be motivated. But today, sometimes profit enables us to make people do things that they don’t want to do. Is this a necessary evil, or just another fixable bug?
This is an article in a series on how Zacqary proposes society might debug the profit motive. This is the third article, on the bug of pressure. The others are on the profitable bad behavior bug, and the “shiny gold coin” bug.
Problem: Pressure to Do Undesirable Things
In part two, I discussed the problem of wealth inequality: some people simply don’t have the means to engage in all of the Theoretical Pure Free Market Mutually Beneficial Transactions (TPFMMBTs for short — pronounced “tehpiffumbutts”) that they wish to. Often, this is for very silly reasons, like being born into a family of a certain wealth level. But let’s imagine, for a moment, an ideal world without this problem, in which everyone is completely capable of engaging in whatever tehpiffumbutt they desire.
I do not want to wear a pink tutu and scream out “I’m a pretty, pretty princess!” in the middle of Times Square for three hours. I have absolutely, positively, no desire to engage in such a thing. Unfortunately, the only people in the world who sell the life-saving medication that I need don’t accept any other form of payment. For whatever reason, these demented pharmaceutical peddlers would greatly enjoy watching my public humiliation, and find it to be worth a few of the pills they produce. So, in order to survive, I’ve been pressured to do something very undesirable.
Come on, Zacqary! It’s not a mutually beneficial trade if only one party is happy with it.
Stop interrupting me, Div Class Redbox, nobody likes you. Of course this isn’t actually a real tehpiffumbutt, because a world in which everybody is always capable of making a transaction that equally satisfies both parties is just as ridiculous as the idea of me declaring my royalty, beauty, and femininity to New York City for three hours while wearing ballet clothing — especially as a form of payment and an alternative to death.
The point is, when our entire economic system depends on quid-pro-quo, with no rational incentive for just plain altruism besides “feeling good about it” (which doesn’t go very far), people can get stuck doing things that they’d really, really, really rather not do.
Solution: Incentivize a Gift Economy
What if there was a world in which everybody just did stuff for each other, without demanding anything in return? If this world existed, there’d need to be some kind of system of incentive for behaving this way; otherwise it’s just as ridiculous as a pink tutu-clad John Galt.
Speaking of science fiction novels about libertarian-utopia-theme-parks, let’s talk about one that’s slightly less absurd: Cory Doctorow’s Down and Out in the Magic Kingdom. One of the central premises of Down and Out is a monetary system called Whuffie, best described as a reputation score. If you do something that somebody likes, they up your Whuffie. If you do something they don’t like, they make your Whuffie go down. As the novel describes it:
Whuffie recaptured the true essence of money: in the old days, if you were broke but respected, you wouldn’t starve; contrariwise, if you were rich and hated, no sum could buy you security and peace. By measuring the thing that money really represented — your personal capital with your friends and neighbors — you more accurately gauged your success.
And in the book, it works: people with high Whuffie scores get invited to parties, get waited on hand and foot, and can generally depend on others to help them. People with low Whuffie scores don’t get much of anything from anyone. But whether you have 1 Whuffie, or 1,000,000, your opinion still affects the Whuffie of others equally — it’s truly egalitarian. This is a gift economy with incentives: the more gifts you give, the more Whuffie people give you.
Most importantly, in a Whuffie economy, there’s no real pressure to reciprocate, or do anything in return. The only real pressure, if it can be called that, is the unspoken pressure to do good things that make other people happy. That’s a very broad field: you could make people happy with paintings if you like to paint, with inventions if you like to invent, with building homes if you like to build, or whichever calling you find in life — all without having to worry if people have enough money or credit to pay you for it. Rarely, if ever, would you find yourself in a situation in which the only way to make anybody in the world happy was to do something that you absolutely didn’t want to do.
To some degree, Whuffie is already emerging: all over the web, we have Like and Dislike buttons, Thumbs Up and Thumbs Downs, +’s and -‘s. Doctorow, in fact, got the idea for Whuffie from Slashdot‘s Karma system. Flattr is already adding monetary value to a reputation score, by backing each button-click with some Euros. As our online actions become increasingly aggregated, and all of these Likes and Thumbs and +’s and Flattrs come together, it’s not unreasonable to assume that the Internet will eventually be keeping track of how well-liked we all are. Our Whuffie scores may be building up already.
And offline, people already have social capital with one another. The more your friends like you, the more they’ll do for you. Whuffie just quantifies this social capital, allowing it to be tender with people whom you haven’t met before.
In most regards, the profit motive now runs smoothly. To profit, you need more Whuffie. To get more Whuffie, you need to do good things and be appreciated for them. At last, profit and good are the same thing, and the bug is fixed.
Problem: Technological Limitations
Unfortunately, another central premise of Down and Out in the Magic Kingdom is a future post-scarcity society. Death has been cured, all the necessities of life can be manufactured limitlessly, and the only things in short supply are people’s time and effort. The technologies to make this world a reality will take a very, very long time to see the light of day.
Until then, we live in a world where we have quite a few things to take into consideration before deciding to give a gift or do something useful — many of them more important than “how much do I like you?” Janice the baker has to consider whether she has enough flour to make more muffins, and the flour company has to consider whether there’s enough wheat in the world to make more flour for her. Even if Kevin has a million Whuffie, she can’t just give him a thousand muffins, no matter how nicely he asks. This failed transaction could go one of two ways:
- Kevin could completely understand, and take just two muffins.
- Kevin could get all indignant on her, and be all like, “I’m a Whuffie-millionaire, bitch!” And then Janice would be all like, “Oh no you did not just call me that! I’mma down-Whuffie yo’ ass!” And he’d be all, “Girl, don’t you be takin’ mah Whuffie! You just got down-Whuff’d, ho!” And then Janice’s homegirl would be all, “Oh hell to the no, K-Dawg! That’s some bullllllllshit you just pulled! Yo’ Whuffie goin’ dooooooown, sucka!” And so on and so on with more people until a total economic collapse occurs in East New York, Brooklyn, because that’s apparently where we are if everybody talks like this.
It would be nice to assume that the former outcome would always happen, but if the civilized and highly intellectual dispute over scarce resources that is the latter outcome is possible, we have to account for it. But scarcity isn’t the real problem in this situation; it’s the fact that there were no real limits on how much Whuffie damage everybody could do to one another.
With today’s closest Whuffie analogue — the like/thumbs up-click — there are discrete, individual things that the button click applies to, and it can only apply once: one thumb/like per person. In Down and Out, the Whuffie system is controlled by brain implants, and it’s implied that the system separates the actions of others into discrete, individual things that can only be up- or down-Whuffied once per person; upping or lowering someone’s Whuffie presumably doesn’t count as an “action”.
Until we have brain implants, these kinds of rules aren’t enforceable. Or at least an AI to police the system and throw out bogus transactions — the amount of them happening 24/7 would be too much for humans to review. Since it turned out to be a lot of fun on part two, if you’d like to leave a comment on this article, please include the word “pancakes” to prove that you’ve read this far.
Scarcity does cause a problem in that the rational incentive to pay attention to Whuffie is limited, compared to the incentive to pay attention to who has the most of a certain thing. At this point, we’re back to square one. Whuffie may not be sustainable before post-scarcity.
But is an incentivized gift economy really not feasible with today’s technology? Let’s see if we can’t debug the idea to make it work today.
Solution: Credit/Reputation Hybrid
The system I’m about to describe is an idea I’ve never seen brought up before, and I’ve never seen anything like it actually attempted. While everything else I’ve said in this series is rooted in observations of the real world — by myself and others I’ve learned from — the following is a hypothesis; an untested, alpha version of an idea.
Let’s take the core ideas of Whuffie, and mix in some of the mechanics of Ripple, the credit system I described in part two. I’m going to call the result Chutzpah, because, like “Whuffie”, it’s a very silly word.
Everybody starts at 1 Chutzpah — the minimum. Individuals can increase one another’s Chutzpah based on the difference between them: Alice has 9 Chutzpah and Bob has 6, so she can give him up to 3. Like Whuffie, her Chutzpah doesn’t get spent; it just increases Bob’s. Alternatively, Bob could give Alice 1 Chutzpah; 6 minus 9 is -3, but the minimum is 1. Let’s call this the D, for Difference: D = (Giver’s Chutzpah – Recipient’s Chutzpah), or 1, whichever’s higher.
Let’s say both of those possibilities happen: Alice gives Bob 3, Bob gives Alice 1, and now Alice has 10 and Bob has 9. They can just keep on giving each other 1 Chutzpah forever, right? No. To better illustrate why, let’s say Bob comes back later when he has 15 Chutzpah, accumulated from other people. His D to Alice is now 5, but he can only actually give her 2. Why? Because 3 of the Chutzpah he has already came from Alice — his Chutzpah partially relies on her. Let’s call this the R, for Reliance: R = Amount of Giver’s Chutzpah previously obtained from the Recipient.
Therefore, when giving Chutzpah to somebody else, the total Available Chutzpah (AC) = D – R. The minimum AC is 0. This is just the maximum that can be given, of course; giving less is permitted.
But once you’ve got your Chutzpah, that’s not the end of it. If the people who gave you your Chutzpah start to dislike you, and feel that you’re throwing your Chutzpah around where it doesn’t belong, they can take it all away. Bob only has that 3 Chutzpah for as long as he’s a good person in Alice’s book, and vice versa with what he’s given to her.
However, if Alice takes the 3 Chutzpah back from Bob, only Bob loses Chutzpah, not the people he’s given it to. For example, Bob has 15 Chutzpah and Charlie has 10, and Bob gives him 5 (15 – 10 = 5). After Bob gets knocked back down to 12 by Alice, Charlie still has 15 Chutzpah — and his Reliance on Bob is still 5. Because of this, Charlie’s still got his Chutzpah, but he can’t use it to bail out Bob (AC = (15 – 12) – 5 = -2, rounded up to 0).
Got all that? Okay. With Chutzpah, there’s a limit to how much a single other person can affect your reputation; this mitigates a low-tech Whuffie’s potential problems, like the aforementioned well-mannered and cordial disagreement between Janice and Kevin — they can’t just de-Chutzpah each other over and over until they both have nothing, nor can all of the bystanders.
Additionally, there’s now a real, tangible advantage to having a better reputation: individuals with higher Chutzpah have more Chutzpah to give to everyone else. People with high Whuffie scores get waited on hand and foot just, you know, because. On the other hand, people serve those with a lot of Chutzpah in the hopes of joining the club.
While the High-Chutzpah Club does have tremendous power, they have to keep on being good people in order to maintain it; the moment they start to abuse their power, all the people who helped them get to the top can drag them right back down again. Chutzpah’s not quite as egalitarian as a technologically-complete Whuffie system, but it still works out well.
Whuffie, even with all the necessary technology in place, isn’t perfect. It would arguably favor popular opinions and actions, sometimes unfairly — though this is hardly any better with our current monetary system. Additionally, as it’s described in Down and Out, it would eliminate economic privacy, as everyone could look at the transaction record and see whose Whuffie comes from whom. Chutzpah would be much the same, along with a whole slew of other potential issues that I’m not thinking of — I’m sure you’ll all have a blast pointing them out in the comments. Perhaps these problems are worth the benefits, or maybe they’re just more bugs waiting to be fixed.
We’ll likely never have a perfect system. We may never be able to make individual profit completely synonymous with the common good. But I’ll be damned if we can’t try, and we can get as close to perfect as possible. The profit that individuals seek is measured today in shiny gold coins, and slouching towards shiny gold math coins — that’s hardly the best we can do.
Free market theory posits that individuals will act in their rational self-interest. As human beings, our rational self-interest is a better world for everyone. Every time a person lives impoverished, uneducated, malnourished, and powerless, that is one less unique viewpoint and one less voice in our global conversation. Every time we allow a small minority to accumulate wealth at the expense of others, that is one more threat of a chaotic revolution to throw a wrench into society. Every time a human being’s potential is wasted and squandered by forcing them to fight for survival instead of utilizing their unique talents, we all miss out on what they could have done. All this because our definition of “profit” is broken and misplaced.
This bug is marked as critical. I’m assigning it to everyone.