Practical participatory economics :Wed 12 Jul 2006

Practical participatory economics :Wed 12 Jul 2006

Unread postby lazerzap » Wed Jan 19, 2011 4:51 am

Wed 12 Jul 2006 : Practical participatory economics

There is a foundation (herein called "the Institute") which holds
some of my copyrights and which I have used from time to time as a
front, gently concealing my freedom from the social covenant. There are
activities that the Institute should engage in that require substantial
cash reserves. Normally NGOs beg, but I'm no good at that sort of
thing, so the the Institute has created an offshore startup company
("") to fund it.

This little seed has pushed through into the light from the dark loam
wherein ideas are born and now calls for gardeners and manure. To supply
them the Institute will pool auction off 40% of the company over two
months (i.e angel investors get their investment / total investment of
the 40% auctioned) to anyone who will invest. There's no higher reason
for this approach, it is a method of gaining initial funding.

There are two dilemmas (di-lemma = "two truths". 2 dilemmas = 4 truths).

The investment. It is a great blessing to have courage and foresight that
results in wealth producing rather than wealth destroying acts. However
foresight is limited and the connection between dividends and the
intelligence of the original investment, assuming there ever was one,
slowly dwindles to zero, whittled away by fate's unrelenting peturbations
of man's activities; above this plunging donkey, dividend payments
may soar exponentially till they yearn for the Islamic opprobrium on
unearned wealth. Now this very possibility, this pleasant vision of
pocketing of the dividend fatwa, increases investment without increasing
investment discrimination unless some investments can be seen to exclude
this eventuality.


There is thought of engineering investments so that after a substantial
return, dividends are transformed into a donation to the Institute
or some other charity, but this will reduce total investment, perhaps
resulting in a net evil, since we define the Institute's ability to act
as a good. Examining the extremes, we see immediately that if the company
makes nothing, the Institute makes less than nothing and the investors
make less than nothing while if the investors receive substantial unearned
wealth, then the Institute is well funded and able to act. But wealth
flows from the ongoing daily labors of those running the startup. Here
we see the disparity. Their labor is ongoing and connected to wealth
production at all times. Individuals who start companies try to minimise
share dilution while maximising investment. While larger companies
will sell bonds or borrow at market rates, startups succeed in attracting
investors to their roulette table by offering the carnal vision of
l'amour without l'commitment. Can we reinvent the bordello? This brings
me to the next dilemma.


How should employees, if that word is not too psychologically confining,
be compensated for their time and abilities? ''anyway they want to be''
for supply and demand works for novel compensation schemes just as it
works for traditional wages. So my question becomes, 'given that the
founders loathe paperwork & consensus and need to satisfy investors that
their investment isn't going to be entirely returned in form of employee
stock options, what is left to offer employees? How can their hearts be
opened to the new?'
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