A sustainable economic system for a human society follows the grain of our evolutionary nature.
Once the mutual safety of individuals has been established, the trading of goods and services for exchanges of value is natural. These exchanges allow the individual specialisations of each member of the group to bring their particular value to others in the group.
Much of the mechanics of what we call “business” or “economics” today is perfectly natural, it is the context within which it operates that needs to be changed.
A Sustainable Economic System
A sustainable economic system exists as a child of the society within which it operates, and includes these features.
- The basic material safety of citizens is guaranteed irrespective of economic output, returning balance to the employment relationship.
- Finance is returned to its natural place by removing its role as guarantor of personal safety for citizens, freeing monetary policy to deliver on its primary role of protecting the value of currency.
- The monetary cost of labour is reduced through the absorption of subsistence labour costs by the Universal Services, making micro activity and infrastructure investment feasible.
- The true cost of inputs is enforced, through systems such as a carbon tax, ensuring that externalities are factored into economic decisions.
- Tax rates are equal for personal and business activities, removing distinctions between labour and capital gains.
The adoption of fiat currencies to match the greater ability of every individual to make their unique contributions to even larger social groups is appropriate and useful.
Economic activity can be defined as the activity that is above and beyond the provision of basic social safety. This activity enhances society, but is not essential to the maintenance of peace and safety.
Activity that is essential for the safety of the citizenry is a public utility, and naturally falls outside the normal bounds of commercial prerogative. These activities are regulated for pubic safety.
After giving expression to individual contributions, the next most important thing about economic activity is that provides the means to fund better universal services. Through the collection of taxes on economic activity to pay for universal services, a society can increase its resilience, capacity and safety. So long as the burden of taxes does not substantially restrain the first priority (individual contribution), then tax revenues can be used to improve the universal structures on which economic activity thrives: education, transport and information.
Corporation taxes are not required to maintain public safety, those costs are borne by Personal Income Taxes, so Corporate Taxes are used to fund other public costs, such as the military.