Tuesday, 1 January 2013

Inflation is Wrong Direction for #PostScarcity

Post-Scarcity (PS) means everything will be free. Things only cost money due to scarcity of supply, which is why our air, which we breathe daily, is free. There is such a massive amount of air therefore you cannot control or regulate the supply. A resource can only be controlled, regulated, portioned out, when the supply is scarce. Money is the method of scarcity-regulation for the management of our scarce resources.

So how can we reach PS with minimal disruption when not many people recognize the inevitability of PS? I think deflation is the correct route to PS but many people do not think PS is possible thus I suspect deflation will be difficult to accept.

Inflation is the wrong route regarding everything being free because a sudden drop from very high prices to zero prices is massively more disruptive than a change from deflating prices to zero prices. Currently prices are going in the wrong direction.

Historically deflation was bad. The current tendency of civilization to be deflationary, however, regarding various aspects of global financial turbulence from 2007 to 2013 (ongoing, see links below), this current inclination towards deflation is valid, it is a realistic type of deflation based on burgeoning PS. Historic deflation was bad because the context was wrong but now due to the context of rapidly developing technology, the context is right, the time is ripe for deflation. Sadly deflation has been resisted by global Governments. Quantitative Easing has been using to artificially create inflation, which is a wrong-headed approach based on a lack of awareness regarding the beginnings of PS.

"Quantitative easing can be used to help ensure inflation does not fall below target. Risks include the policy being more effective than intended in acting against deflation – leading to higher inflation, or of not being effective enough if banks do not lend out the additional reserves." - Wikipedia.

I estimate PS should occur no later than year 2045. Yes the Singularity is explosive, yes dramatic suddenness is inevitable, in a good way, but the suddenness does not need to be cataclysmic, it does not need to be disastrous. The explosive transition into everything being free can be controlled. To the best of our ability, considering the radicalness of the circumstances, we can smooth the transition. The drama of the transition is unavoidable but we can make the transition less shocking. Yes there will be a clearly demarcated point where things are not free then things are free, but it makes vastly more sense, when the final transition into everything being free happens, if we are heading in the correct direction, the deflationary direction. This why inflation is very bad, it is senseless because it resists the inevitable, resistance which could be very harmful.

We need to be going in the right direction for PS, the deflationary direction, we need to #DeflateToZero.

In the early 21st century financial crises afflicted many parts of the world. The solution in all the following cases is to recognize looming PS, thus we can cancel debts with impunity. We need to lower prices, we need to stop worrying about profits and debt.

2008–2012 Spanish financial crisis
European sovereign-debt crisis
Financial crisis of 2007–2008
Greek government-debt crisis
2008-2012 Icelandic financial crisis
2010 United States foreclosure crisis
United States fiscal cliff

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