We continue with the seventh in our series of excerpts from Barry Carter’s book Infinite Wealth. See: 1) The Rise of a Win Win Civilization 2) A Personal Journey of Discovery 3) Why Corporations Don’t Work 4) The Emancipation of Capitalism 5) Mass Privatization: Organizing in the Information Age and 6) Decentralized Wealth Creation
Tom Peters had the following to say about a camera he purchased in 1992, which had more brainpower than the Apple II computer he bought in 1982.
“I spent seven hundred bucks on that camera. What did I buy? I bought about three dollars worth of plastic. I bought about $15 worth of optical glass. I bought about $682 worth of software, computer power and imagination. We are in an age where brawn is not the driving force, where human imagination is the driving force.”
The Infinite Wealth Potential of Liberated Humans
Toffler, in Powershift, identifies violence, wealth and knowledge as the three primary forms of power in society. He shows violence to be the lowest quality of power, and dollar wealth to be second and knowledge to be the highest quality power, due to its leverage potential, versatility and limitlessness.
In the transition from the Agricultural Age to the Industrial Age, people went from working and creating wealth on the “land,” powered primarily by force or violence, to working on “things,” powered by dollar wealth as shown on The Age Wave Chart. Today, wealth-creation is shifting from the making of “things” powered by dollar wealth, to the creation of “knowledge” powered by information. Information technology is turning knowledge into the premiere power in society.
In PowerShift while explaining the power of “knowledge,” Toffler demonstrates that one idea can be used simultaneously by fifty or five hundred or five hundred million people. One person can only use one gun (representing violence power) or one dollar (representing dollar power) at a time. In the past, one therefore had strong motivation to tightly hold on to whatever power (dollars and guns) one had, and not to share them with anyone.
Today and even more so tomorrow, sharing power (information and knowledge) directly with others, under the right aligned conditions, can create more wealth for oneself. In fact, sharing knowledge under the right conditions, such as Mass Privatization, is quickly becoming the best and fastest way for an individual to win. Mass Privatization provides tremendous leverage to the individual who helps others. This change gives humanity the opportunity to shift from tens of thousands of years of win/lose norms to a win/win norm.
Era of Infinite Wealth
Since one idea can be shared by billions of people and they all win and ideas and knowledge are infinite, wealth has become infinite. Paul Pilzer, in Unlimited Wealth, shows how technology, which rests entirely on knowledge power, is the driver of a new alchemic world with new rules of wealth-creation. The dream of past alchemists was to turn lead into gold. Today, using knowledge and ideas, we, for example, turn sand into something more valuable per pound than gold, computer semiconductor chips.
Infinite wealth goes against common sense and our experience. Infinite wealth is too good to be true. It is like creating something from nothing. This nothing, however, is actually something. It is ideas in people’s heads that comes from knowledge, which is created from information inside of billions of neurons and neural connections. Tangible wealth is today created from information.
Deepak Chopra, in Creating Affluence, approaches infinite wealth from a scientific and spiritual perspective showing that ideas, beliefs and knowledge are the creators of physical and non-physical wealth as well as the universe itself. Using quantum physics, he shows that atoms, which make up everything in the universe, are made of information, knowledge and intelligence and not solid material. Though the nature of quantum physics will be explained in more detail later, the bottom line is:
Information, knowledge and intelligence today are the primary forces driving wealth-creation and the human brain is the primary creator of knowledge. For the first time in history the masses of individuals own the means of production—their own minds and brains.
Wealth-creation, therefore, can no longer be controlled, it must be liberated and based upon individual freedom.
The Vision of a Real Free Market
Our thinking regarding free markets is incoherent and not fully developed. Like many other paradigms it too is limited. What we’ve seen for the past 200 years has not been a free market. Today most people equate a free market with companies, managers, stock markets, corporations and win/lose competition for limited resources and customers. We think of hard and tough “businessmen” honed on the gridiron for fierce competition, who are willing to do anything to win. Real free markets have little to do with any of this.
Real free markets are merely about win/win interactions. They are soft and based upon collaboration, love, interconnection and the free flow of wealth and knowledge between people. People collaborate in order to create more wealth from an infinite source instead of competing for scarce wealth. Free markets are about human liberation and the free exchange of ideas, knowledge and work. They are about exploration, discovery, learning, creativity and spirituality. Most of all they are about caring for others, helping each other and love.
Yes, this is a radical departure from our traditional definition; the words “love” and “free market” in the same sentence sounds odd. The broader and more accurate definition of a free market is a community where humans are free to create, exchange, interact and interconnect in order to meet each other’s needs, thereby creating wealth for themselves, others and society.
Infinite Power of Free Humans
Wealth is not something that is static, finite or absolute. As will be discussed in more detail later, wealth is created through the meeting of human needs. Since wealth is created when people trade work with one another and meet human needs, wealth and wealth-creation is infinite. Why?
Because the more people, the more needs there are. With more needs comes more work and the more work the more income and wealth there is. Traditionally we have thought that the more people there are the less wealth there is for each. This is not true. What we find is that the more people the more wealth there is for everyone.
If we think about this deeply, we will see that there is absolutely no reason why there isn’t plenty of work and wealth for everyone. By answering the following four questions we must conclude that wealth is abundant:
If all of the above is true, then what is standing in the way of infinite wealth? Why is there poverty, unemployment and people starving in the world? Let’s take an even closer look at wealth-creation to find out what is restraining it.
The cycle of work, which produces income then causes spending, thereby creating more work, can be self-perpetual and infinite, in a knowledge-based free-market economy. The catch is that the flow and trade of work, ideas and knowledge must be free and unhindered. The freer and more fluid the flow and trade of work, ideas and knowledge the wealthier we all become.
First of all there must be trade. The more trade the more wealth as seen in industrialized nations. However, what in these economies causes wealth to be finite? Controlled economies, Mass Representative Democracy and Centralized Wealth Creation, the systems that have produced our current levels of wealth, are also the systems in society that prevent wealth from being infinite. Controlled economies are today constipating the wealth-creation process because of their inherent focus on controlling the wealth process, instead of facilitating wealth’s unrestricted flow. Control produces scarcity, whereas, free flow produces abundance.
The head financial officer in a controlled economy is called a controller for a good reason. Within controlled economies performance is achieved through consistency and process control. Consistency is achieved with forced, rigid standardization based upon average performance. Controlled economies are machines and each part must be identical within a tolerance, just like parts of a machine. We should all walk alike, think alike, dress alike and park in specific parking spaces, “a place for everything and everything in its place.” Averages are everything to the mass-production-based controlled economy.
Companies, for example, have almost as hard a time with many of their top performers as their bottom performers. This is because the top performers produce too much variability, making mass production processes hard for bureaucrats to control. Controlled economies prefer the average performer because of consistency. Manufacturers use Statistical Process Control (SPC) to produce quality products. The SPC definition of being in control is have a consistent amount of process variability, with the thrust being to continually reduce process variability.
The obsession with averages and reducing variability forces the controlled economy to thrive upon mediocrity. Like Antonio Salieri, Mozart’s rival in the movie Amadeus, the controlled economy is the “champion of mediocrity.” Today, however, to be in control is to be out of control.
What is needed to unleash the infinite power of wealth-creation in an Information Age is a system such as Mass Privatization which allows people to freely synergize and trade their work output, information and knowledge. This system must allow trade to occur easily and quickly, without hindrance. The system should facilitate and encourage the free flow of trade. The last thing our wealth-creation institutions should be doing is attempting to control the wealth-creation process.
Decentralized Wealth Creation and Mass Privatization operate based upon Chaos Theory, in which the norm is the more variation there is, the better. The more weird the ideas the better, because in a mass customization era a very wide variety of ideas is mandatory to meet customer needs. As documented in many books, success only comes through many tries and failures. Mass Privatization achieves order from individuals trying lots of wild ideas, having mostly failures and having the freedom and incentive for the thousands of individuals to calibrate on each other’s best ideas. This calibration occurs of the individual’s own free choice.
Recently I spent two years living in rural Southside Virginia near where I was born and raised. We lived on a large, beautiful lake—the largest and most secluded lake on the entire east cost. The surrounding community, however, was quite poor, or at least this was their perception. Southside Virginia had been a thriving hub of commerce in the Agricultural Age, but with the decline of this era, so too came the decline of this rural area. As work in agriculture dropped and manufacturing increased, industry was not attracted to this rural community.
Though there are tremendously talented people in Southside Virginia, they don’t perceive it this way. Their egos have been bludgeoned by continuous decline since the end of the Agricultural Age. When my wife, Linda, told an acquaintance that we had recently relocated there from Southern California, her response was, “Oh I’m sorry, things must really be going bad for you.” She thought that surely nobody in their right mind would move here from Southern California, unless they had no other choice.
The people in the area think of themselves as dumb and poor. They also don’t perceive their time as very valuable. After traveling the world and working with the best and brightest, I can honestly say that I knew people from Southside Virginia who were barely surviving, but were as talented as any engineer, artist or manager anywhere I’d been. They perceive themselves as dumb and poor because they have less dollar capital than people do in more industrialized areas. They have been trapped by the Industrial Age paradigm of dollar capital. Today they only need a shift in perception to see their abundance of tangible wealth.
Though these people have little dollar capital there is no shortage of capital at all. Capital is defined as a stock of accumulated goods. These people have an overwhelming stock of accumulated knowledge, talent, intelligence, creativity, and work desire. Since wealth-creation is merely comprised of people trading their work with one another and with there being plenty of capital, all that is missing is a means to exchange their work with one another. The Industrial Age, with its controlled economies and public work, made dollar capital the sole means of exchanging work, with employment being the primary method. In Southside Virginia, with relative little industry and with dollar capital in such short supply, the perception is scarcity.
Toffler, in PowerShift, shows that we are moving to a super symbolic economy with super symbolic capital. As shown in The Age Wave Chart, in the Agricultural Age, a dollar was represented by a piece of metal or something worth one dollar—a dollar’s worth of bartered potatoes, chickens or smoked bacon. The dollar piece, for example, was made of one dollar’s worth of gold, silver or some other precious metal.
As we shifted to the Industrial Age, a dollar came to be represented by a piece of paper. The paper dollar is perhaps worth less than a penny in real value. It symbolically represents a dollar’s worth of work or value. It is “symbolic” money.
In the Information Age today, the bulk of dollars which change hands are never touched. They are transferred from one person’s bank account to another, as electronic symbols flow from one computer to another. These electronic symbols represent paper dollars, which in turn represent a dollar’s worth of value—hence super symbolic money.
Money is merely a means to measure how much value has been added or wealth created by one’s work. It’s a way to measure how much work each person has performed. Money allows one person’s work to easily be exchanged for another person’s work. An electronic barter bank would allow jobless and moneyless individuals who desire trading their work, to do so, and thus increase their individual and collective wealth.
With the advance of information technology virtually anyone can today set up an electronic computer barter bank using a Personal Computer. There is, therefore, no reason why people in Southside Virginia should be restrained in the trading of their work simply because there is a shortage of controlled-economy-based jobs and U.S. dollar capital. There is, after all, an abundance of human-knowledge capital, plenty of human needs to meet, abundant information technology and plenty of people ready to work.
Limited monopolistic dollar capital has twisted and blocked our perception of reality—tricking us into thinking that wealth is limited. It has slowed the trade of work and constipated the wealth-creation process—the meeting of human needs. Today, we are in an era of super symbolic money where a mere shortage of dollar capital is not a valid reason to keep people from working, trading their work, creating wealth, meeting human needs and growing wealthy. We merely need a shift in perception.
When we combine an understanding of what money is with the following three facts, it becomes self-evident that parallel sources of capital—private capital—will explode to break lose our present constriction in wealth-creation:
Toffler, in PowerShift, speaks of parallel forms of capital coming into being in the Information Age. One thing holding back Southside Virginia and many other communities nationally and globally, is their perception regarding money, capital and themselves. Already today there are barter banks springing up to fill the dollar capital void. In Raleigh, NC, a local barter bank has been started with hundreds of members. An article in Mother Earth News, October/November 1993, shows that private citizens in Ithaca, NY and Myrtle Beach, SC have established parallel sources of capital. Roger Langrick in the book Barter Systems begins to define the shift to private capital in society.
Regarding the residents in Southern Virginia and elsewhere, a shift in perception towards the private electronic exchange of work through networked private capital will allow for a more free-flowing exchange of work. A shift in their perception of themselves as worthy human beings, as will be discussed later, is also required before they will acquire the wealth lying within them.
As shown in The Age Wave Chart, we are transitioning from a system of trade based upon one monopolistic currency, which today restricts the free trade of work, to super symbolic multiple currencies, networked together to form a global system of fluid and freely trading work. As individual local electronic barter banks begin to connect with one another globally through the information superhighway, they will produce a network of seamless, global multiple currencies. These multiple currencies, which are an integral part of Mass Privatization and Decentralized Wealth Creation, will further liberate the free and fluid flow and trade of work, ideas and wealth.
Envision a networked barter bank of 5000 people. The idea is to set up a barter bank for a given region. People, though they have little dollar capital, can trade what they do have, the ability to do things, fix things, make things or provide some service. The barter bank is, in essence, a trading house. Each member has an account. Example: Jane, a member has 200 P-dollars (private dollars) in her account. Jane needs her car repaired but does not have any traditional dollar money to pay. Bob, who is also a member in the network, agrees to repair the car for 80 P-dollars. When the job is complete, Bob’s account is credited 80 P-dollars from Jane’s account. Bob, who’s retired, has no traditional dollars to spend since his social security check for the month is all budgeted. He does, however, have 80 P-dollars. He searches the network database for items or services for sale.
He finds Anne who is unemployed but talented at refinishing furniture. His granddaughter’s third birthday is coming soon. He has Anne refinish an old child’s chair that was his when he was a child. Sixty-five P-dollars are transferred from Bob’s account to Anne’s account. Anne, being unemployed, is on a tight budget and her house very badly needs some repairs. She contracts with James, a young man right out of school who hasn’t yet found a job. James, eager for income, does the repairs and is credited 200 P-dollars.
John, a local clothing retailer who is being hard hit by a recession, decides to begin listing some of his merchandise on the network. He figures it cannot hurt. James trades 200 P-dollars for a new suit for job interviews. John begins to move merchandise at four times his normal rate through the network, even though he is selling this material at a relatively higher price than what is paid in his store with dollar capital. John has a problem. He has lots of P-dollars but no dollars to restock his store. His suppliers are hundreds of miles away and haven’t even heard of a barter bank and have no interest in his P-dollars.
John decides to put some of his P-dollars up for sale on the network, in exchange for dollar capital. For the people in the network who have access to traditional dollar capital this is a good bargain. They buy John’s points for 75% of their value with traditional dollars. The people who purchased John’s P-dollars have plenty of dollar capital, and see this as an opportunity to get products and services at a discounted price below the dollar capital rate.
John then takes the cash and restocks his store. Everybody wins. Even though John sold his P-dollars at a discount, the volume and lack of advertising and other overhead to sell the merchandise has made it quite a profitable deal.
John then takes some of the additional P-dollars and has some remodeling done on his house by James and others in the network with carpentry and masonry skills. The bottom line is that the gross wealth of the community and standard of living of many people has been increased, merely by injecting a parallel form of capital into the system and enabling work to be traded more freely. Parallel sources of capital, in essence, jump starts stalled parts of an economy. They empower people to bootstrap their way out of a hole by trading work that would not have been traded, and meeting needs that would not have been met without the additional source of capital. It provides a system of self-regulation, eliminating restrictions in the wealth-creation process.
In the example above people were able to trade their work, receive income and meet some additional needs, only because there was a parallel source of capital. I personally know of people, living in Mecklenburg County, Virginia, who fit the description above. They are talented people who sit idle each day receiving a government check, not working, not adding value for others, not receiving compensation and with many needs being left unmet, partly because of gridlock created by having only one source of capital.
I know a man who can repair cars who is sitting idle as I write this paragraph, while a lady two miles away, has needed her car repaired for months. This man at the same time has needed some furniture refinished while the same lady, who has furniture refinishing skills has nothing to do. Neither has money to pay the other. They fail to see the wealth they already own and do not trade their work because of their dollar capital paradigm. They both live below the poverty line while receiving a government check and both sit idle each day with little to do, little money and many needs going unmet. We have tens of millions and hundreds of million, in fact billions of people globally, hindered in the trading of their work for the exact same reason. What a waste!
The new parallel forms of private capital may not replace dollar capital. Parallel forms of capital complement each other in the forming of a truer free market. They keep things in balance, break bottlenecks and keep things flowing. These parallel forms of capital break the logjams which dollar capital creates through a monopoly. They allow work to be traded more freely.
Parallel forms of capital have begun to and will continue to spring up around the country and world. This is simply because there is too much pressure on dollar capital, with people being dollar capital starved in a capital rich world.
As the growth of information technology reaches a critical mass, Networked Private Capital will become a norm. It is also inevitable that information technology will turn local private capital into regional, national and even global private capital. It will obliterate national boundaries. It will make billionaires of the individuals who pioneer electronic barter banks, thus enabling billions of other people to win. The freer we make the flow of information and the trade of work, the wealthier we all become.
Parallel forms of private capital are an inherent part of Mass Privatization. They empowers the individual to trade work, information and knowledge quickly, easily and without hindrance. It supports the paradigm of infinite wealth.
Information Technology, Free Trade and Infinite Wealth
In The Virtual Corporation, William Davidow and Michael Malone show a correlation between major historical growth periods and the orders of magnitude improvement in technology needed to create them. They state:
Historically, whenever important technological innovations have resulted in improvements equal to at least one order of magnitude, revolutionary changes have occurred in the way people live their lives and conduct their business.
They show that from 1770 to 1851 productivity of production workers jumped by roughly 300 percent or two orders of magnitude, fueling the start of the Industrial Revolution. They go on to show the orders-of-magnitude-change that we’ve had in information processing in the past decades.
Although, strictly speaking, one cannot add all advances together because there would be double counting, it can be said that forty years of computing has experienced a combined improvement in five dimensions—mass storage, reliability, cost, power consumption and processing speed—of thirty orders of magnitude. Such a level of change is almost beyond human comprehension. It is equal to the jump from the diameter of a single atom to that of the Milky Way galaxy. As we noted above, it took a change of two orders of magnitude to spark the Industrial Revolution and one of only four orders of magnitude to end World War II and redirect human history. (with the creation of the atomic bomb)
I personally know of the change in information technology all too well. As an example of some of this improvement, in 1986, when I founded CheckMate, I purchased a 120 megabyte hard drive for my Personal Computer. It cost $2,800. People told me that I’d never need that much space. Most people had 20 to 30 Megabyte drives. In 1991 when I replaced it, I paid $495. In 1993, the last time I priced a 120 megabyte drive, it was less than $200 and I was told that I’d be lucky to find one. By 1994, 120 megabyte drives were no longer available because they were too small. By 1998 I could get a 13,600 megabyte drive for $299. The price went from $23.30 per megabyte to two cents per megabyte. That’s an improvement by a factor of 1059 times in twelve years. In the same time the speed more than doubled and the power consumption and sheer weight dropped to a mere fraction of the original “boat anchor” I purchased in 1986.
Davidow and Malone go on to show that there is consensus building with many noted economist regarding the value which computers have added in to society from our system of Centralized Wealth Creation. The data shows that there has been little to no productivity gain from our orders of magnitude increase in information processing technology. Harvard economist Gary Loveman says:
I’m here to tell you that after several years, my results have been poor and the results of many of my colleagues who have tried similar things are also poor. Poor in the sense that we simply can’t find evidence that there has been any substantial productivity increase—and in some cases any productivity increase—from the substantial growth in information technology.
Davidow and Malone go on to show that there is historical evidence which shows that there is a lag between huge advances in new technologies and the real results they deliver. With technology improvement of thirty orders of magnitude sitting idle, we must ask, what is holding back its impact on society? It is waiting for a system of wealth creation that at its core is based upon the free flow of work, knowledge and wealth—Mass Privatization. When we think about it the free flow of work, knowledge and wealth is exactly what information technology does best. The thing that is holding back information technology’s impact on society is the control of wealth creation that comes from controlled economies and Centralized Wealth Creation. We have a wealth creation system that is not aligned and does not match the new technology—it cannot fully utilize the power of the thirty orders of magnitude improvement. As long as information technology is used merely to pave Industrial Age cow paths, we shall realize little real benefit from it. Like the water wheel and the steam engine one cannot effectively mix technologies or institutions from different eras.
Mass Privatization, which at its core embraces the free flow of work, knowledge and wealth, provides a system which fully utilizes the advances in information technology. As a critical mass of Mass Privatization and the Information Superhighway is developed we shall see an economic growth explosion unparalleled in history which shall shift us all into an era of mass affluence.
Mass Privatization empowers individuals to create their own work and to find their own niches. This is opposed to the individual finding a job that a centralized government or company bureaucracy has created. We should remember that a free market is simply an environment that provides maximum freedoms and options for individuals. A true free market is about human freedom, the human spirit, compassion and helping others. It is about humans collaborating to meet human needs and, therefore, creating wealth.
With Mass Privatization and Decentralized Wealth Creation people will be liberated throughout the world to add value where they see fit. They will be liberated to search out human needs and meet them. They will be liberated to discover human needs that customers didn’t even know existed. They will be liberated to create human needs and meet them.
We are looking at a civilization with six billion individuals working hard to figure out how to help each other and one where the people who do this best create more wealth for themselves. WOW!
With six billion liberated humans there will be more gross wealth and it will be distributed into more people’s hands. After my awakening to Mass Privatization I looked deeper into the consequences of this new paradigm, synthesizing more and more pieces. It became clear to me that the concept was a stepping stone to something even bigger than I could have ever imagined. This shift in perception was in fact jolting. It presents us with the opportunity for far more than a mere new type of wealth-creation enterprise to replace the company. It presents us with the opportunity for an entirely new wealth-creation paradigm “a new civilization unlike anything before it” a civilization of win/win, abundance and infinite wealth.
This shift to win/win would unleash enormous positive powers. I then knew that the pain which humanity was presently experiencing was part of the greatest emancipation in the history of the world. It is, in fact, the emancipation of the human spirit.
It has been demonstrated with the Agricultural Age to Industrial Age shift that a simple change in wealth-creation power, from violence to dollar wealth, releases tremendously powerful advances in human growth. With the Industrial Age to Information Age shift, there is far more potential increase in standard of living, quality of life, productivity and advancement, than there was when we shifted from the Agricultural Age to the Industrial Age. This is because of the enormous power delta between knowledge and wealth, versus wealth and violence. This delta includes the win/win nature of knowledge, its leverage potential, as well as the infinite nature of knowledge. The magnitude of advances made in the Industrial Age will be dwarfed by the magnitude of advances to come as the infinitely powerful win/win knowledge fuel kicks in with Decentralized Wealth Creation.
There is nothing in our imaginations today which can even come close to imagining what is possible in ours, our children’s and grandchildren’s lifetimes. The shift from dollar wealth power to knowledge power as the fuel powering civilization and the Mass Privatization organization as the engine, are revolutionary changes. They lay the foundation to thrust us at the speed of light into a new dimension. It is a dimension that will result in the end of poverty, unemployment, racial strife, hatred and war worldwide within a relatively short period. They will produce tens of millions of millionaires and at the same time end government taxation as well as government itself. It shall dramatically increase everyone’s standard of living and quality of life. And all this is likely to happen within a single lifetime.
It will repay the trillions of dollars of government debt. It will pay off the billions of personal and business debt, repay the third world debt, and repay the debt all of the industrialized nations. It will end our quality deficits, educational deficits, and environmental deficits. It will enable the repayment of the national debt left from the Agricultural Age owed to Indians, slave descendants and others. This will not come from the mass wealth re-distribution and affirmative action programs mandatory to attempt balance in the Industrial Age. It will come through wealth-creation opportunity and economic freedom for the individual. It will end our crime, violence, education and quality deficits, as well as most of our other win/lose deficits. It will provide a foundation and means to end our abundance of fear, hatred and self-hatred. It will do this by providing a strong motive for cooperative opportunity. It will do all of this with no taxes, no welfare, no giveaways and no government.
What we are speaking of when we talk about a free market economy in an Information Age is a self-perpetuating supercharged engine that runs off of the highest quality power there is, knowledge and wisdom. I am speaking about human freedom, choice and options.
Copyright 2000 by Barry Carter
About Barry Carter.