Someone Else's Money

I had an interesting conversation with a colleague this morning, where they were talking about the difficulty of selling to family owned companies, because they are tighter with the purse strings. And, in order to sell to them, a personal relationship is generally required - is this cronyism?

Nope.

It is good business sense.

When you are having to spend your own money, you want to make sure you can trust the people you are handing it over to and there is some level of responsibility on their part, not just on you as the buyer. Building a relationship does this. Also, once that relationship is built, it is possible to make faster decisions on track record of past performance of delivery and impact.

However, when spending someone else's money, it can be easier to make the decisions to spend, as there is far less skin in the game in terms of personal responsibility and hits to the hip pocket. However, it can also have more layers of bureaucracy, and people often "justify their position" by making imaginary roadblocks, rather than facilitating the process. After all, they don't want to be seen as expendable.

However, in general, spending other people's money is far easier, and so much of the economy is driven by this, where there is an intermediary of some sort that gets proxied to do the spending. And, often this is legislated, meaning that there is very little choice on how much or on what our money is spent. For example, government spending comes entirely from taxpayers in one way or another, yet they spend it as if it is their own, as if it is "government spending".

And we accept this and believe that for instance, all those government handouts are coming from the government, not from our own pocket. But, the governments have no pockets, they are all wearing pants we have loaned them and apparently, left our wallets in, with all of our cards and pin numbers. And, obviously banks are no better with spending other people's money, nor are businesses with venture capital money. It would be interesting to see how many new companies fail because of financial irresponsibility.

However, perhaps the more this happens, the more some people are waking up to the understanding that proxying value might be convenient, but due to incentives of humans, rarely is going to work out long term. Everyone's behavior is affected by incentives and when it comes to economic practices, it is all about more is better, the bottom line, profits - it doesn't matter if it is bad for people, the environment or any thing else.

Another colleague today in a separate conversation was talking about the thing that needs to happen with the banks is more regulation, because the "free market" isn't working. They never stopped to think whether the market is actually free or not, where regulation itself indicating that it is not.

They cited for example environmental considerations being legislated and without the legislation, the companies would pollute. However, this is the problem with the legislations, because they are brought into one area to have an effect and people forget, no legislation is holistic. Instead, it makes people feel like something is being done, when it actually isn't having a meaningful affect at all.

For example, I said that what if the entire supply chain was blockchained and transparent, where for example, it would be possible to see every "transaction" and the effect it has on the environment or the people along the production process. For instance, what if like nutritional information, it would read:

To create this iPhone, a million liters of water were used, 12 kilos of carbon dioxide was generated, two people died in the mining process, 14 women were under paid, 8 children were used in assembly...

Would you buy?

Some would. However, there would also be a complete shift in the way consumer products have to be produced, as well as the cost of production and purchasing them. Because, not enough would likely buy, just because of the social implications. However, social implications and consequences are only applicable, when there is visibility on activity, which is why the internet is full of trolls.

Because they aren't getting punched in the face.

But, as my colleague noted, "no company would agree to that!"

Of course they wouldn't. Which is why it is up to us to demand transparency and visibility, yet we will not, because we want cheap electronics and shoes, whilst shaking our head at all the pollution "China is creating".

And it is the same with environmental issues. It isn't until the rich enough are living in pollution and squalor, that anything would be done. Yet, all of this is created through consumer behaviors and there is no need to change, as long as it is someone else's problem. Just like spending someone else's money, making things someone else's problem is easy, because then we don't have any liability and therefore, don't have to do anything about it.

We can just keep shaking our heads.

Yet, nothing is actually going to change, for as long as there is incentive to hold the status quo, it will be held. And the economy incentivizes turning a blind-eye by encouraging the proxying of our wealth to others to make the decisions for us. Even when they screw up badly, we can "blame them", even though we are the ones actually affected, we are the ones suffering.

If though, we were instead in 100% control of our wealth and had to pay for everything out of our own pocket directly, we would far more resemble the family-owned business, being far tighter with our money and more careful with whom we were to give it to. Look at our consumer behavior now, where if we were to buy a pair of jeans for 100 dollars and find out there was a hole in them later, we would take them back to the store and demand a refund. However, even though 40% of our yearly salary goes to a government, we demand nothing from the holes in their product.

And governance is a product.

It is a goods and service business, yet even when we are unsatisfied with what is delivered, there is no consequence for the vendor. It stays in power, though the CEO and management might change every few years.

When we are actually spending "our own" money, our behavior changes, but as we know, no fiat currency is actually our own, we are just "permitted" to use it for a period of time, but it remains the property of the issuer - the same government that is using our wealth to exist. And just like the redtape in a business that has to make itself relevant, the more regulations the government is allowed to create, the more relevant they become. Not only that, the more legislation we agree to, the more ways there are to break the rule s and open ourselves to punishment, by the very system we fund, whether the rule makes sense or not.

Do you think that if Russians had control of the wealth of the country, they would have opened up their wallets wide enough to fund a war with Ukraine? What about all the other wars in history?

Countries go to war, not people.

But they go to war using the wealth of the people and when they don't have that available right now, they borrow the wealth from the people of the future in the form of debt.

But, this is not what we have been taught to believe, so we stand behind a broken economic system, that supports a broken state and social system, because that keeps the control of our value, in the hands of others. All we do is complain about the conditions of our lives, as if we have no part in the process. We do this by making our value, an easy spend, by giving it to people who then see it, as someone else's money.

Unfortunately, this isn't someone else's life -

It is ours.

Taraz
[ Gen1: Hive ]