Here we discuss a potential basic framework for a society without money; as in lacking an internal need for money and also how they deal with demand for items that cannot be provided free of money.
The primary idea is that basic human needs (housing, food, water, electricity, etc.) are provided to all at a basic level without any bills being presented. An underlying assumption is that not all of existence becomes free of needing money to survive, only a limited group of, at minimum, sufficient landmass, natural resources and inhabitants that it can support itself indefinitely. Trade with other groups is possible and presumably required for some desirable goods.
We will also discuss a potential trade currency, to allow exchange of resources. We do recommend to keep trade flowing as much as still possible, to maintain relationships. Failure to do so would create the risk of shortages during a disaster or failed harvest: If merchants are unable to do business somewhere, they stop coming. We shall name this trade currency credits, citizens can accumulate them and potentially exchange for currencies of other societies (for purpose of trading or travelling, whatever they see fit).
More luxurious items, or fancier versions of the basic needs could be acquired with the credit. A potential difference between free basic items and luxury goods, could be if the good can be made internally, so without need for input from outside, which would require payment to purchase the input.
Requirements for a society without money
Below is a list of potential prerequisites for the discussed society. Each should edit this list based on their own needs and circumstances.
Infrastructure, physical and digital: Not having a backlog in maintenance for all forms of infrastructure is advised, as the new financial system may create some discomfort with suppliers. Fact remains, road need to be safe and internet fast, anything else reduces all activity and hampers production. Future projects might even be jeopardised by insufficient capacity on the electrical grid.
Basic education: All citizens should be able to read, know basic math and other selected knowledge. The purpose of this training is to allow citizens to function within society.
Advanced education: Solely for the purpose of performing specific tasks, that cannot be taught on the job, within reason of time and safety. Knowledge of the human body, and most common conditions, is essential for physicians. Not knowing these things beforehand will lead to excess deaths. Some specialised functions, such as accountant, do not require a priori training as accounting systems are sufficiently advanced to handle over 90% of the job. Seniority combined with on the job training and seminars can imbue the required specialist skills for the remaining 10%.
Oversight: As market stimulation becomes less direct, increased data monitoring of consumer habits is required for signalling an outdated supply side. Just because something is free, does not mean people have to like it.
Means of compensating the rich and powerful for losing a portion of their influence: This is a role for the credit, besides letting them keep their mansions and cars. Bank deposits can directly be replaced by the credit, investments depend on the scope of the money lite society and role of the investment vehicle; corporations that still trade with outsiders for actual money could have equity of genuine value, where those that only deal with a society free of money will have no monetary inflow, so no value.
Central bank: As mentioned earlier, buying and selling of goods with outsiders is assumed, so their currency must be acquired and sold at some point. A value in internal credits must also be assigned, based on the value of spent currencies. Private bank accounts are possible for the credit, allowing interest, however it might not be possible for banks to make loans, which pay for accumulated interest, so a single central bank holding all credits could suffice.
Good long term plans for the credit: What activities earn you credits? How are they created, physical, digital or both? Will the prices of luxury items be adjusted based on short term factors? These are some of the many questions that need to be answered to manage purchasing power and thereby unrest over inequality.
Outline of basic needs for the society without money
Below the list of what is to be made available free of charge. There is a small dilemma; do you provide without limits, allowing some to take advantage of the system, or will there be rations/monitoring of how much is used, to identify and thwart those that create credits at the general expense. We will assume that no system for checking usage exists, whilst acknowledging that as a naive choice.
Housing, in its basic for a flat in a big building, will be provided to every citizen of a certain age. Governments need to prepare for this event via a list of all flats, with occupied or vacant listed. Based on the total tally, more should be built, or empty flats can be filled with newly adult inhabitants. It will not be made mandatory to occupy the flat, not doing so will mean that the flat goes on the vacant list. Potentially to co-exist with your partner and children, or to occupy a fancier dwelling. A new flat can be requested at a later stage, without guarantee of immediate vacancy, as not occupying the original flat was your own choice.
Food and personal care items, a healthy diet and regiment must be determined and made available for all citizens. This is likely distributed via existing infrastructure, such as grocery stores. Non-basic items can be made available via the same grocery store at cost of credits, with a clear partition to signal that these goods carry a cost. Maintaining a checkout system will be mandatory, to pay for the luxury goods. A different solution would be multiple types of grocery stores, one for free goods and another for paid ones. Both versions of the grocery store will require workers, to fill and maintain the shop.
Utilities; electricity, water and the likes are to be supplied, via existing works, with expansions to all houses. Some existing machinery can be removed as keeping track of usage is no longer required, saving labour and some energy demand. Removing the price incentive is likely to increase normal usage, such as people taking longer showers.
Communication technology, this includes internet and phone networks. The internet was absolute fiction and phone lines a luxury but a few decades ago, nowadays internet has become essential for most jobs and having a country run without it requires significantly more labour. Changes in usage are likely, but not related to free of charge status, more based on technological development. It remains to be seen if technology remains the cheaper option, compared to human workers when the workers become cashless.
Repairs: Charging credits for repairs, means that savings will be mandatory and thereby regularly earning of credits, as such creating the exact same system as with money.
With clothing a tiered system is likely; basic clothes for free, pricier materials and such are not free.
Trade credits
A means for exceeding basic needs and allowing trade to flourish needs to exist. We recommend transferring a small amount of credits to every citizens` account on a monthly basis, youths potentially excluded or discounted, so that all can purchase some sort of luxury. The amount transferred should be monitored for- and adjusted with inflation.
Role of labour
Depending on the needs and wants of the society, some jobs will earn credits and others will not. A possible distinction is based on demand; a high demand for certain jobs could lead to a credit reward based on hours worked or signing bonus. In a cashless society, those with its replacement are likely placed above the rabble.
A different distinction would be jobs that play a direct role in trade with the outside world or in creating items sold for credit, where money has a place, such as producing luxury items that are sold to both fellow citizens and traders who pay their currency for the luxury item.
The latter option could be rewarded with a percentage of the actual amount, transformed into credits or by directly selling the item yourself, maintaining separate bank accounts in credits and the currencies used for payments.
Uses for credits
Potential uses for credits, more can be added as seen fit:
- Trade with outsiders.
- Buying and selling internally of luxury items. Such as bigger housing or expensive clothing. Buying and selling within the society would be possible, but as all transactions are with potentially scarce credits, the possibilities for profit are limited. Buying and selling, also with outsiders, does offer potential for profit, assuming there are little measures taken to prevent profiteering.
- Investing in companies that are active in trading. There actually is a big advantage to be had here; as the government does not have to pay its civil servant, it might not have to tax any wealth. Creation of other investment vehicles is possible, just beyond the scope of this article.
- Forms of entertainment, such as gambling directly or wagered as chips in games of poker. Not recommended by this blog, we are just being realistic. Assuming such options exist in the cashless society.
- It is not inconceivable that credits become something used to curry favour, as a token of appreciation that can be used for other things as well.
Potential credit formats
Three forms of how the credit itself could be are discussed below.
Purely digital: This is the easiest form, an amount is added and deducted based on real life events, much like money movements on current bank accounts.
Purely phycical: The used material would have to be sufficiently tough to withstand changing hands on a regular basis, whilst also resisting weather and time, so most likely a metal, stone or artificial fabric (comparable to current cash), to also allow specific forms to be made for different amounts of credits. Unlike money, for most of human history, there is no real need for the credit to have a material worth, as it only serves to acquire other goods: This is a good thing as silver is affected by sunlight, any moisture and even human touch (oils and sweat on the hand), whilst gold is heavy and wears fast. Paper variants and coins both are valid options, depending on the material and their properties weighed against availability. Availability of materials for a society without money might be limited.
Mixed: In a mixed form, the ability to make deposits and withdraw credits in physical form becomes relevant, so a paper variant becomes more likely, the ability to ingrain microchips into paper is easier as it has less resistance than a harder coin (both for inserting and reading). Using an artificial fabric, comparable to plastic, such as a credit card format, seems the better choice as thickness and physical properties can be engineered for optimal usage. Inserting chips for easy recognition can be added to the casting process. Adding codes is something that can be done for both; it already happens with paper money (all notes have serial numbers) and coins have to replace dies anyhow because they rarely make it to more than a million (depending on the metal, some barely make it to two hundred thousand), bill dies can last for decades as the material is far softer.
