In today's video I use First Principles Logic (and STEEM) to argue that money can be thought of as a "productivity point system." As I have said in the past, my goal is never to tell people "how things are," but to explore ideas that enable ordinary people to expand their understanding of complex subjects like technology and economics (techonomics).

Who Cares?

There is a paradox with money which is that the easier a form of money is to use the more successful it will be, but the less you have to think about it and the less important it is that you understand it. Even if one does think about money and has some very strong beliefs about what it is and why we use it, that is no guarantee that they are right. Many in the US still believe their money is backed by gold, and even though they are wrong it doesn't interfere with their ability to buy a pack of gum. This creates a scenario where a great number of people can form a lot of very bad beliefs about money that impact their lives in subtle, invisible ways they cannot see because they do not understand a critical component: money.

The Unique Challenges For Cryptocurrencies

Never before have productivity point systems been so consciously and intentionally designed. Previously they had evolved out of pre-existing forms of money which gave them an antifragility that only evolutionary processes can. The US Dollar, for example, is named after the Spanish Dollar which at one point came to dominate American commerce not because anyone made a conscious choice, but because it simply survived and thrived in an unregulated battlefield of currencies. Now that people are intentionally designing currencies, their faulty understanding could have massive repercussions if they are expressed in the structure of the monetary system they are creating.

It is my hope that the following brief video/podcast gives the viewer an alternative perspective of money that, regardless of whether I'm right or wrong, helps expand their understanding of the subject and test their prior assumptions.

Also on iTunes as: The Andrarchy Show

TL;DR

The First Principles are:

1. Productive people create valuable things
2. Value is subjective

The reason we always create money is because we intuitively understand that we must develop a system for keeping track of and rewarding the most productive people so that we can maximize the number of valuable things that are created (what we call in the aggregate "wealth"). Given that value is subjective these points must be in the hands of the individual so that they may distribute them based on their subjective evaluation. For these reasons money can be thought of as a "productivity point system." The better designed the system, the more efficiently it rewards productive people and accurately reflects the subjective valuations of its users.

If there's anything you'd like me to discuss next, please let me know in the comments!

Yanis Varoufakis on a Universal Basic Income