The Evolution

Tripartite Ecosystems

Means of Power | Ecosystem Promises | Territorial Overlap | Macromanagement

Means of Power

a. governance determination

In the paradigm expressed so far, an economy is a form of government;
where the rule of law is ensured by price systems manifesting a consensus.
The parallel is clearer within a decentralized application.
It isolates simplified functions.
In the mainstream Economy, a legislative power defines business rules.
Companies are entrusted to take actions like a distributed executive.
They apply legislation on their own;
but also in the interests of workers, investors and the state.
Likewise, a government is a form of economy;
where the rule of law is ensured by a judiciary manifesting an authority.
Hence, consensus represented in the price characterizes economic activity.
Which tripartite ecosystem could resolve a given societal problem?
Should it be resolved by a government, an economy, or a mix of them?
It boils down to the distinction.
Should subdivided problems be solved by authority or consensus?

Ecosystem Promises

b. primary problem of economics

Rule of law acceptance posits a beneficial posture.
The value proposition of a promise legitimates the ecosystem oversight.
According to social contract theory, individuals consent to accept it.
The promise made by a modern government states that everyone is equal.
Under the Law, it opposes the promise of markets:
everyone is different in the economy.
Authoritative or economic oversight determines the relation to power.
Ruling systems make equally subordinate subjects or unequally free peers.
Society is relieved from harsh inequality in total freedom by the State;
and from harsh equality in complete subordination by the economy.
The State guarantees rights and the economy personal will.
The consent of oversight for these two deals is generally accepted.

The problem is where to draw the line between each ecosystem.
Equal standing is a precondition to trade as opposed to appropriation.
The State promise reduces inequality variance where it is fulfilled.
Equal rights provide a greater spread of resources than privileges.
Distributed opportunities rely on fair legislation away from despotism.
Each side of an impartial deal must be balanced but offsets contradict.
A decrease of variance for the sake of spread is also a loss of freedom.
The legislative space excessively restricts a safe scope paring change.
It requires expert knowledge to navigate.
Poor Alice and rich Bob must both revise restricted endeavors.
Out of place, laws impede resource repartition as much as wild prices.

There is no such thing as an objective appreciation of changing wealth.
Both ecosystems must coexist for the future to be equally promising.
Environmental inequality arises from two unique sets of circumstances.
Essential inequality cannot not exist between two unique individuals.
The tradable adjustment of inequalities is more bearable outside the law.
Social disparity exchanges relative preferences to a certain extent.
Outside constraints, chosen inequality is a freedom of concerns.
Such a concern could be philosophy.
If you'd like to sleep in a jar on the market like Diogenes, you could.
Another concern could also be gold in other places.

In Switzerland, I was once told by a Californian girl:

Money can't buy happiness, except in California.

She knew sign language despite her high monetary expectations.
Social occupations are not known for lofty remuneration.
She had a complementing collection of concerns.
She was ready to work harder or smarter for extra bucks.
A government would dictate how much good she would do with them.
It is only her to judge, as guaranteed by the economy.
Like anyone else, she was able to recognize a need which is not addressed.
Where to draw the line between governments and economies is subjective.
Let us ask how, instead.

The issue is how to trade out of undesired and unique situations.
We derive the right tools:
exchange protocols offer various paths towards different aspirations.
Governments cannot decide for us but guarantee that we have a choice.
Should you trade your time for a degree or your body for a pittance?
Upper and lower limits of tradable conditions frame accessibility.
The State breaks its promise out of economic bounds:
below affordability and above sophistication.
Exclusive rights are responsible for the skewed allocation of resources.
But the wealth gap is not of a government resort within tradable bounds;
where it is precisely the consequence of a free economic promise.
Inequality ambivalence infers a generic trend between ecosystem remits.
A fulfilled state promise widens economies in scope and participation.
The perfect State does not exist.
Yet, we need it until is has accomplished its purpose:
the liberation of opportunities.

The inference smells very much like the dictatorship of the proletariat.
Bad odor perforates the border between opposite promises.
It repels the destruction of freedom by political radicalism.
Hayek published "The Road to Serfdom" the year before his 1945 paper.
A Wikipedia contributor extracted the essence of this influential book.

Referencing the Austrian author:

He argued that fascism, Nazism and socialism had common roots in central economic planning and empowering the state over the individual.

Authority permeates through the fine line of freedom.
However, empowering the individual over the state moves away from it.

The overlap of ecosystem legislatives coincides with economic immaturity.
Constitutions attempt first to underpin both governments and economies.
Scaffolds amalgamate with buildings.
Economic legislatives could very well be separate from governments.
Let us not confuse limitless governments with their restricted ability.
Caricatures of governments exercise undue and overwhelming influence.
The twentieth century has witnessed a number of harmful exaggerations.
Communism exhorted that everyone should be equal within a price system.
State managed equality was contradictorily applied to the economy.
Our expansionist institutions still carry a part of responsibility.
The State is meant to relinquish control when it is safe to do so.
Disinterested authority leads society the furthest away from martial law.

Government solutions to wealth distribution cannot address the root issue.
Nor can they sustain lasting change.
They must empower.
They operate in a different ecosystem cycle with opposite assumptions.
The governmental problem is the allocation of equal rights.
States entrust inclusive rights so more resources flow between peers.
How they flow, however, is a very different matter.
Interference impedes direct exchanges.
Third-parties, including institutions, endanger social cohesion.
They corrode or prevent reciprocal social bonds established by trade.
Shared wealth arises from the exchange of relative differences.
Free exchange distributes inequalities devoid of power asymmetries.
The economic problem is the allocation of varied resources.
It is only solved satisfactorily by flat consensus outside governments.

Territorial Overlap

c. confused institutions

The high-level distinction of institutional issues is straightforward.
The state prerogative is to provide the baseline of human condition.
States guarantee the observance of unalterable and fundamental rights.
On paper, a state is a protecting authority.
All which is not absolute, but relative, is of the realm of the economy:
from share rights to conditional commitments, contracts.
In this context, self-determined contracts do not challenge governments.
Nor do they challenge the judiciary rule of law.
Smart contracts experiment to compose the next generation of protocols.
They fulfill their own legitimate purpose.
They are already recognized by a social process of self-regulation.
Yet, the state legislature is not going to relinquish its business scope.
We would rather see it take a consensual stance to resolve trade issues.

Free token rights will be officially recognized when they are understood.
The value created on DLT reached a new level of trade transparency.
No company makes transactional data auditable publicly in real time.
But the mainstream focus is on speculation rather than business utility.
Until this changes, the authority will be uncomfortable.
The lack of absolute guarantees is understood as a risk or an escapism.
Price action is the very mechanism of regulation which states are seeking.
Token bubbles hide underlying price systems making up protocols.
External price trends don't look like controlled solutions.
The slow evolution of institutions will lead to turning points.
In a faraway future, states will buy governance shares in free protocols;
these protocols will turn into governments under international law;
people will eventually claim their right of self-determination;
and will finally establish a country on the blockchain.

Macromanagement

d. economical State

We have elaborated on demarcating features of governments and economies.
They determine the use cases of both ruling ecosystems.
It could now be helpful to generalize in a greater abstraction.
We could comprehend what power organizations have in common.
The next chapter will resolve conceptual conflicts.
They arise when different powers mingle.
Guided by functional utility, we will reconcile confusion.
This will allow us to consider substitutes maintaining a given purpose.
They can only be articulated within a generic ecosystem.
We are already hinting that institutions are not set in stone.
Before we reorganize power, prudence asks first how entities could evolve.
The economy is a governance problem relying on institutional protocols.
As an echo of the first introduction paragraph:
assumptions in laws of economics are only valid within a given paradigm.
Indeed, we propose to optimize the protocol rather than the assumptions.
They can become obsolete with significant changes of resource allocation.

The economy is constantly rebalancing knowledge.
We try too hard to conform fluctuations with our current understanding.
We are unwillingly triggering large adjustments;
which we have previously contained.
Anomalies signal that assumptions should be modified.
If only we knew how to distinguish fluctuations;
rather than modeling them on other past fluctuations;
we would learn something new.
We could proactively enhance within a process rather than intervene late.
Firefighters extinguish remote fires when smoke shows up on the horizon.
A central bank is akin to a single fire station in a sprawling city.
Monetary policy must provide political safety.
Social stress has to be relieved to avoid dividing extremes of politics.
They increase conflicts further away from consensus.
A government contains an internal economic problem.
In "controlled variability" invoked earlier to fend off suboptimization:
control is governmental and variability economic.

Business rules should not be part of a different ecosystem than business.
The legislative and the executive should depend on the same rule of law.
The inconsistency between subsystems breaches compliance by design.
The executive is obliged to reconcile two different rules of law.
The administrative cost is a symptom of poor ecosystem design.
Businesses must continuously weight opportunities against the law.
The grey zone is a gold mine.
Regulators scale up surveillance while increasing the compliance burden.
The economic rule of law is strikingly more efficient to regulate trade.
Price systems price out the unacceptable without delay and monitoring.
Transgression is always an option at a high cost, like in a judiciary.
The crucial trade benefit of price systems is a wiser plural assessment.
There are as many judges as market participants in the economic mind.
States are prone to micromanage markets because laws govern specifics.
Micromanagement suits the oversight of rights in any circumstance.
However, this predisposition effectively suboptimizes economic activity.
Price systems are better designed to regulate unique circumstances.
The economy could only become an official ruling power;
if it does not remain a conflicting partner of governments.

Edwards Deming consistently advocated for the appreciation of a system.
He would decry the tension between businesses and regulators.
The statistician's teachings are pointing towards a sensible future.
He is credited for the tremendous post-war rise of the Japanese economy.
He remained faithful to his theory throughout his consulting life.
He saw it work too well, beyond his own wishes.
A patriotic American was unwillingly challenging America's economy abroad.
He was embarrassed, as his grandson tells in "The New Economics" foreword.
Deming generously shared a secret with manufacturers: a methodology.
It taught them how to learn from samples out of statistical control.
Abnormal deviation was used to inform changes to the process.
Efficiency gains within a macromanaged system go through the roof.
Outliers are bursts of dynamics continuously at play within a process.
The isolation of outliers in extreme conditions turned blue collars white.
It allowed the identification of main drivers behind unrestricted results.
Workers were then able to pull the right strings to enhance the output.

The prestigious Deming Prize is a testimony of precious knowledge.
The award for quality management recognizes continuous improvement.
The exact opposite habit inhibits change in the economy's management.
Long-standing processes go unchallenged as historicals accumulate.
Conflicting anomalies do not change procedures.
Crises are fixed by tougher regulations to shift responsibility.
Lawmakers are more worried about sustainability in politics than business.
Rules are decided by outsiders pointing fingers in a different ecosystem.
The cost of capital is free from a central manufacturer standpoint.
Inflation and interests are paid by individuals and businesses.
Theoretical likelihood prevails over valuable methodology.
Governing institutions do not have skin in the game.
They should be regulated.

A decision scientist addressed a crowd of PhDs in Toledo:

If you have done something smart, this is stupid. You cannot reproduce.

Indeed, we would rather govern with intelligent protocols.
Most of the time, we cannot rely on stupidity.