Blockchain Communism

I am personally in favor of a basic income and social dividend approach to socialism; communism will come eventually, as technology advances and renders money obsolete, but communism is not something that I think we should pursue in the near future. However, I do suspect that blockchain technology makes communism more feasible.

The big problem with communism is that it doesn't really have any good way of determining what ought to be produced. Under capitalism, demand is reflected in prices and demand indicates the desires of consumers. The pricing mechanism helps to determine what the wants and needs of the people are. Unfortunately, each dollar is a vote, which means that the demands of rich people are met before the needs of the poor are met. If, following Abba Lerner’s advice, we equalize the distribution of wealth relatively, so that no one has much more influence over the market than anyone else, then the market’s pricing mechanism is simply a mechanism for establishing consensus about the desires of the populace. This is why economists speak of the “democracy of the marketplace.” Blockchains essentially serve as a mechanism for establishing consensus as well. A blockchain does not have to be linked to a currency system at all. This causes me to suspect that blockchain technology could be used to establish consensus regarding the allocation of resources and distribution on a communistic basis. And this would be much more decentralized than most historical communist schemes.

During the socialist calculation debate, the Austrian School economists argued that the efficient allocation of resources in order to adequately meet the needs and preferences of the people would be impossible without the pricing mechanism. It was argued that the necessary knowledge for making wise decisions could not possibly be made available to central planners, so a centrally planned economy was doomed to fail. Otto Neurath and Amadeo Bordiga argued that requests for goods and services could be utilized to establish what the preferences of consumers are. This would allow for economic planning under full communism. Historically, however, there was no real way to establish consensus. The planners of industry, whether worker-managers of co-operative businesses or central planners of nationalized industries, could never have had the capacity to collect and analyze the relevant information before making their decisions. The pricing mechanism makes such collection and analysis unnecessary. If it happens to be less efficient to get resources from source A than from source B, then A’s price will be higher than B’s. The buyer doesn't need to know all the details about how and why shipping from A is more difficult and requires more labor than shipping from B. All they need to know is that the cost is greater. They will then buy the cheaper of the two, which coincidentally leads to the most efficient allocation of resources. If buying power were evenly distributed, prices and free trade would lead to a relatively efficient/optimal distribution and allocation of resources.

A blockchain could be used for collecting information. It could use smart contracts and the quantity and quality of goods could be listed on the blockchain. Requests for goods and services, with a ranking system for reflecting hierarchies of preferences, could be put on the blockchain. On the blockchain-based blogging site Steemit.com, Steem Power is a sort of reward that you can either earn or buy that affects the power of your votes. You can upvote posts that you like. And you can slide a bar to indicate how much you like a post, choosing to give them either a full upvote or a partial upvote. I think something akin to this could be done on the communist blockchain in question, but it would need to be done on a more egalitarian basis. Each person would be given an equal amount of Commie Power. And then they would have a certain amount of voting power with their requests for resources from the community. When you made a request, you would basically be upvoting your own request, but you would have to rank your preferences. With every upvote/request, you would lose some of your pull within the system. Each subsequent request would be worth less. So, you might use your full power requests for food, but only put a quarter upvote for your request for a new book. The people with the highest preference for items would receive them first, taking also into account the time of the requests. Yet, all people would have the same allotted power in the system, so it would be fair. And the system would automatically allocate resources algorithmically, in accordance with established rules. If an item takes a lot of resources to produce, then perhaps it would require more Commie Power to call on that resource. This may mean that people have to pool their resources in order to acquire it. When your request for something is granted, then the item could either be automatically shipped to you or a token commanding that resource could be issued by the system. If your request for a book is approved, then the book will automatically ship to your address. If your request for a home is granted, then you receive a token or receipt representing your claim on the particular structure. If you request food supplies, perhaps the system would issue you tokens/receipts redeemable at the local grocery storehouse. You could, theoretically, use blockchain technology in order to efficiently allocate and distribute resources in a fully communist economy.

Personally, I think a monetary system in which wealth is automatically distributed in a relatively even way is probably sufficiently analogous to such an arrangement. This approach is also much simpler. If you equalize the distribution of wealth, then each dollar is a vote and the system becomes a relatively fair mechanism for consensus. This would, then, be analogous to full communism, achieving the same goal through different means. And it would be a much smoother transition. I think it would be folly to attempt to transition directly to communism from existing arrangements. It would be far better to transition towards an egalitarian form of market socialism, then maybe transition to communism in the more distant future.