Q. You’ve developed the theoretical framework for a new economic app. Why?
A. I’d been involved in the whole range of urban sustainability work: localization, renewable energy, bicycling and mass transit, food security, local currency, time banks, you name it. I’d come to realize that grassroots efforts, protests, legislative reforms, etc., are fine and necessary, but not particularly effective, in the time we have. It’s too little, too late. The core of the problem that I consistently encountered is the arbitrary labyrinth of the current economic structure. The monetary economy is structured for one thing only: to make profit, and that is predicated on growth, regardless. Unless that underlying premise is changed, we face an inevitable meltdown.
Q. You argue, as far as the current economic system and sustainability, you can tinker around the edges, but you can’t really resolve its lack of accountability to the ecosystem, or really to the complexity of the holarchy.
A. That’s right. And I’ve examined different approaches. For instance, there’s a whole movement centered around the idea of what they call the gift economy. Everybody just shares what they have. I think it’s a wonderful sentiment, but I don’t think that will go anywhere. It will remain a sentiment, an idea. It requires people to adopt certain levels of altruistic behavior. How do we institutionalize that? Without some centralized communistic type structure I don’t see that people would voluntarily do that in large enough numbers to make any impact. So, nice idea, but not practical. I’ve also looked at the Zeitgeist movement and their vision of the future, their systems and architecture. Exciting and appealing, but again I don’t see that that can be applied anytime soon. I see it as impractical.
Q Would you say that these systems have core problems similar to that of Marxism in that they don’t account for human nature, they’re too ‘blank slate’?
A Yes, largely. It’s almost like trying to coerce or manipulate people into certain modes of behavior, which they may not naturally exhibit. So it would require some amount of authoritarianism and loss of freedom. Looking at all of those systems I didn’t think that they were workable. Even going back to The Venus Project, which is mostly what the Zeitgeist movement is from, there’s not a huge amount of detailed information about their system they call cybernation which is a rational management of resources. No one can argue with a rational management of resources, but how? They’re not very forthcoming on how exactly that is going to be done.
Q What is the general idea behind the Planetary Index?
A Different approaches to economies are being tried in various countries. Bhutan has instituted what they call the Gross National Happiness Index. So I thought: What if we take that same idea of creating an index, but instead of it being a national index, we make it global, create a Planetary Index of value, expressed as Net Planetary Value (NPV). The PI would represent a holarchy that would cover regional and national indexes. These indices would include everyone and everything, including all of the things that we don’t want. The generation of toxic waste would have a negative index value. If we don’t want mountain top removal then we give that activity a negative rating in the index.
Q So, to clarify, the app, Planetary Index generates a Net Planetary Value index, a positive or negative value for all components, at every level of the holarchy? It’s a value-accounting system for the myriad holons in the holarchy?
Q Can you define holarchy?
A A holarchy is a network of holons. A holon is complete in and of itself but is connected into a larger network; and that larger network is itself a holon that is connected to still larger networks. Networks that are all tied together comprise a holarchy. An individual is a holon but part of a larger network, the family. The family itself is a holon in a larger network called a community, which is part of a city, a bioregion, on up the ladder. A holarchy is also a feedback system. Whatever happens in one part, one holon, affects all the other parts up and down the various networks. Nothing exists in isolation. There is instant, real-time feedback among all the component parts.
Q How does the Planetary Index work?
A It rates every type of economic activity to a scale that records how the holon’s activities affect or impact itself, its own welfare, its own operation as well as its impacts on its immediate environment and the larger whole, that is, other holons. A Net Planetary Value (NPV) number is generated for everything that exists. If we want to discourage mountain top removal, rather than protest and try to pass legislation to outlaw it, we give that activity a negative index rating. A corporate entity is dissuaded from mountain top removal because their rating would be affected; it would decline. The NPV functions as a value mechanism that automatically provides feedback throughout the holarchy. The value-accounting replaces, supplants currency units. Currency units are a fiction that we use to stand in place of value. Money has corrupted our conception of value. Money does not take into account quality of life, the degradation of ecosystems and many other things. Rather than standing in for value, money has become a commodity in itself, subject to manipulation to the benefit of the controllers. Think derivatives and toxic assets. So I thought, let’s focus on what is of real value. The NPV is an attempt to assign a number to value.
Q You’re replacing money with a value index. Is that accurate?
A That is accurate, but it goes beyond that. An index is a relative measure; it is not a tradable unit. The index is a marker, like numbers on a ruler. You can’t do anything with those numbers but measure. The NPV index gives everyone and everything a relative standing in the entire economy. That standing is also what gives each holon access to goods and services. Again, if there’s no money, there’s no buying and selling in the sense that we understand it. There’s no trading. Yet people have access to things that they need for survival and for fun — food, housing, medical care, computers, cars, flights to Hawaii, whatever. People, corporations, (holons), can, by their own productive activity, create value and increase their value index. And this, in turn, gives them greater access to goods and services.
Q So, if I’m a dentist and I fill some cavities, I might have something like a card that electronically adds value to my index that I can then use to access goods and services.
A In very simplistic terms, that’s how it is. But we have to be very careful when we talk about adding value to the card. That almost sounds like units, and you’re not collecting units, but accruing value by economic activity. The more cavities you fill, the more patients you treat, the higher level of professional service that you offer, the more comfortable facilities that you have for your patients, the better you treat your staff, all of those things will impact your company’s index. The values assigned to these activities will all be designed and governed by algorithms, that, once they’re set up, the index accounting becomes an automatic thing. It does require that there be some kind of electronic interface, whether it’s a card or some other thing.
Q How do you propose to assign value to everyone and everything, and even to abstract components such as how the dentist treats her staff?
A There are three major criteria for determining value indices. We may come up with different criteria, but for now I’m working with three categories: environmental, social and ethical. I separate social and ethical because social includes and recognizes institutions, cultures, political systems, organizations, all those groups that are already in place that hold a certain value. Ethical tends to be those more abstract things that supersede cultural values, supersede convention. For instance, genital mutilation, if just valued by social criteria, would be of certain value in certain countries per their cultural norms. But when you measure it on the ethical scale this practice comes up wanting. I think there has to be a mechanism in place that transcends mere social structures and conventions to really focus on the highest and the best of human experience, our evolution, knowledge, and development. In addition to environmental, social and ethical criteria, I’ve also included the three dimensions of time, past, present and future. So everything would be measured in terms of its past provenance, its history, its present value, as well as its projected value or impact. For instance, today fossil fuels are highly valued. But when we look at the future value we see it declining and going into the negative area because of all the attendant problems of greenhouse gases, habitat destruction, etc. So it is necessary to take into consideration that, yes, fossil fuels have significantly contributed to human well-being and civilization. The matrix for determining these fuels’ index value acknowledges that.
Q So you’ve created a weight matrix for establishing the value of each holon?
A Yes. I thought that this 9-part matrix, Environmental, Social, and Ethical, each weighted across the three dimensions of time, was the most comprehensive schema that I could come up with to arrive at a single number for any given holon in the PI. The value of any holon is not fixed. This value will change in real-time according to the activity of the whole system. Say a holon has an index value of n at this point. If that holon engages in activity that is destructive or unethical, then its index declines as well as its access to goods and services. It’s an automated system of carrots and sticks that makes a lot of laws and/or regulations obsolete or unnecessary because people, out of their own self-interest, will operate according to this system.
Q So a highly toxic chemical has a negative index value and will not be used in products as it would reduce the value of any product that used it.
A Yes. There is another significant part of the Planetary Index app. Every human being, just by virtue of being a human being, has a base index value that allows them access to food, housing, healthcare and lifelong education. Every human being has universal access to these necessities of life. So this takes care of poverty, which is actually the result of and a product of the existing monetary system. For example, with regard to immigration, if there is no money to be earned in another country, you’re not going to risk your life to go there. You’re going to stay at home because your basic needs are being taken care of within your natural support system, your specific biological and sociocultural niche. You have access to lifelong education so you’re going to stay there and pursue what is in your highest and best interest. In other words, you’re going to follow your bliss.
Q Pursue your particular interests, sure. So the Planetary Index system provides all people with housing, education, healthcare and food by virtue of being human. The U. N. has already shown that this could be done if fewer resources were allocated to military budgets around the world. But regardless, say you have a segment of the population, people who, given these basic resources, decide to not work and just sit around and play video games all day. What about people complaining that this is unfair, that all animals and even plants, work for their food, why shouldn’t humans?
A Well, first of all, that is a totally erroneous premise. No animal or plant works. Only humans work.
Q Okay, semantically, if I’m a cheetah and I hunt, chase, catch and kill a gazelle, why isn’t that work?
A No, that isn’t work. That is what the cheetah does naturally, this is what it has to do in order to live. There is no conflict — which is what work is. There is no correlation to work. Hunting is the cheetah’s natural activity. So, in the same way, humans will pursue their natural activity whether it is eating, fucking, drinking, growing food, composing music, or sending a man to the moon. Those are human beings’ natural activities that they will continue to pursue. If a person’s natural activity is to drink beer all day long and sleep under a tree, then they are that kind. That’s what they do.
Q But that has impact on the community.
A Of course it does. And the NPV accounts register that impact. That activity will have an impact on the drinker’s index, and the community’s index. And that’s where all the social norms and peer pressures will kick in. If this individual is not motivated to add value to himself, and thereby the community, it is reflected on the community, too. The community’s index will decline. So it will be in the self-interest of each holon, and to keep it local for this example, it will be in the self-interest of both individuals and the community-at-large to help this person, thereby raising the value of their respective indices.
Q Anger is a biologically embedded emotion that some may vent towards people they perceive to be cheating, defecting from the social contract. So if people see someone in their neighborhood who is drinking beer all day and pissing himself under a tree, they may get angry. Their response might be, “Why does this guy get housing, free medical care, food, etc., when he doesn’t contribute to the community?”
A I’m not sure what you mean by cheating, but in any event, we don’t know that if somebody like had the opportunity to life-long education that they wouldn’t find something that they wanted to do. There’s always something that turns them on. So they would pursue that because they have all these educational opportunities and wouldn’t be just hanging out under a tree stone drunk. Although there are times when they’re going to do that and that’s fine. But there is health support, so if someone has an alcohol or some other addiction they can go to the addiction center and they get taken care of.
Q So you have the opportunity to increase your value if you genuinely try to help an alcoholic with their disease.
A Exactly. The guy under the tree has a value card. So if you’re a dentist, the best way that you can help him is to take care of his teeth. And you’ve added value to the community and increased your access to goods and services. The whole point of the system is not making profit but creating value. That is one of the core concepts of the PI. So if the guy under the tree is not creating value, if he is going to fritter his life away, that’s fine. That is his choice. As a human civilization we have made sure that each of his basic needs are taken care of. Anything beyond that is up to him. That is all that we can do. To elaborate a bit, some of the basis of anger and resentment at someone only consuming and not contributing by creating value, is a core belief that everything has a monetary cost and that has to be paid for. Who’s gonna pay for it? How is it going to be paid for? These are automatic, conditioned responses stemming from our total immersion in a one-to-one, two-column accounting system that even invented the concept of debt that does not occur in nature. Do the gazelles hold the cheetah accountable when it takes down one of their number? No, they are intrinsic to each other, part of the other’s natural cycle. We are not hard-wired for debt so we can apply a new concept, which is that the user/consumer is as much an intrinsic part of the economic process as the producer. The most successful product in the world is nothing without its consumers. The consumer and the producer complete each other’s cycles. Without lifting a finger, a person, as a mere demographic or statistic, represents a base value to the system. This is the rationale behind the universal access afforded to every human being.
Q So how does this new economic system begin to be implemented? How does it get a foothold in the culture?
A I’m thinking that we won’t need to go out and convince everybody that this is the way to go. The way to do this is to start small and let it grow because we are going to have to develop and tweak the idea as we go along, as we learn. It can take root like any start up, Google, Facebook, or Amazon. A small group of people who understand the concept will sit down and work out these algorithms. They will install it in some system, whether a small country or a college campus. Yes there are many problems to solve, but that’s a constant. And remember, there is going to be constantly increasing pressure for systemic innovation due to climate change, etc. We could have holons using the same index system start this independently and it spreads organically.
Q So there’s no “overthrow the government.”
A No, nothing like that. The way it is structured it can operate parallel to the monetary system so there does not have to be a wholesale changeover. We can operate on both systems at the same time.
Q I wanted to ask, from the historical records regarding wealth distribution in various states, and in computer simulation models of economic systems, there are numbers that pop up again and again. For example, the Pareto Principle, which states, roughly, that 20% of the people control 80% of the wealth. (Pareto was an Italian economist who noticed that in 1906, 20% of the people owned 80% of the land in Italy, and interestingly, also noted that 20% of the pea pods in his garden contained 80% of the peas.) I’m thinking that your PI system would not be in conflict with such repeating realities because you’re not talking about everyone being equal.
A Whatever criteria of measurement you use, people are not equal. So why should their index all be the same? Their index is only reflecting who they are and the value they create. As much as possible, the system tries to mimic what happens in nature, and by nature, I mean the whole world of physics, holography, genetics, everything.
Q Can you speak a bit your background and your coming to this idea?
A What is ironic is that I was never good at math. I am an artist and I understand fractals. The Planetary Index system is a fractal model.
A It’s a fractal model because the nature of fractals is that you have one basic quality, unit, or feature that is repeated at different scales. That’s all a fractal is. That’s what this economic model is. It’s the same pattern repeated over and over at different scales, the value index mechanism is repeated at the individual level, the family, the community, the city, the region, the country, on up the scale.
Q How do you plan to proceed?
A My approach is not linear, and necessarily flexible. With regard to implementation, my natural bent is for it to happen organically without imposing any program except to roll out as fast as we can. We are developing a new paradigm, making it up as we go along. There is no precedent. The existing rules do not apply. Obviously, i cannot do this by myself; there has to be a team. Being a stubborn idealist, i cling to the organic approach, depending on open source, cooperation and voluntarism which reinforce and demonstrate the very principles of value we are trying to redefine. For contributors hankering after “payment” or reward, the prospect of “credit carried forward” to their future index could be explored. In any case, attracting capital to create a system that offers no return, and in fact, eclipses capital and makes money obsolete, is a contradiction. That route strengthens our shackles to the idea of money being the sole repository/vehicle of capital. Instead, “seed capital” is the idea/vision/concept/passion/power/ability/skill/experience/connections/structures that anyone who will, brings to the table.
Q How will this team be assembled?
A We cannot depend on social networks and people participation to get this going. It is not a democratic process, which is flawed and inefficient anyway. Innovation is a solitary, almost singular, activity. It takes someone with idealism and vision. Think da Vinci, Tesla, Bucky, and my now-becoming cliche, Zuckerberg. Since no one of us has all the requisite skills, we a need a team of people with particular strengths, working under the radar, creating a computer model, testing, applying in a limited sphere. Our immediate challenge is to identify those persons now, likely some unknown geek in cyberspace.
Q Do you have a theoretical model of how PI works?
A Anything to do with numbers, calculations, formulae, projections, models, is completely beyond me. I recognize they may be necessary and essential to the process which is why i have sought collaborators to contribute what i cannot, and take the vision to the next level. Reading James Gleick’s Chaos, this passage struck me:
A physicist thinking of ideas as regions with fuzzy boundaries, separate yet overlapping, pulling like magnets and yet letting go, would naturally turn to the image of a phase space with “basins of attraction.” Such models seemed to have the right features: points of stability mixed with instability, and regions with changeable boundaries. Their fractal structure offered the kind of infinitely self-referential quality that seems so central to the mind’s ability to bloom with ideas, decisions, emotions, and all the other artifacts of consciousness. With or without chaos, serious cognitive scientists can no longer model the mind as a static structure. They recognize a hierarchy of scales, from neuron upward, providing an opportunity for the interplay of microscale and macroscale so characteristic of fluid turbulence and other complex dynamical processes.
The economy is a mental structure, hence the effect of confidence on the stock market, fads and trends in marketing, so this description applies. As an attempt to manage a non-linear dynamic system, PI is extremely complex; i doubt there are extant modelling tools that can accommodate it, and certainly way above my pay grade to address in a substantive way to compel “investors”. My natural bent and native tendency is skip along, having planted a seed, knowing it will sprout somehow and emerge full-grown in some yet unknown, non-linear way.
Q How will the first codes be determined?
A There are three domains in which value is assessed: social, ethical and environmental, across three time dimensions, which comprise the 9-part matrix. A panel of experts would establish the criteria: geneticists, ethicists, statisticians, actuaries, philosophers, psychologists, neuroscientists, mathematicians, chaosologists, historians, anthropologists, physicists, biologists, geologists, climatologists, cosmologists, systems specialists. These would determine the initial parameters and algorithms, after which the system would adjust itself in response to real-time feedback. Some mechanism to address egregious discrepancies would have to be put in place. The process is not democratic, in the sense that lay persons have neither the competence or expertise necessary for the task. It’s management by technocracy.
Q Is PI intended to replace or circumvent current laws? Take a test case: abusing women. If a man in a culture where abuse is an accepted norm, what would he get for an honor killing of his wife?…as compared to a man in a western culture?
A While PI is weighted toward ethical outcomes, it is not prescriptive. The thorny questions like abortion, genital mutilation, polygamy, etc. are dealt with in their relative contexts, given weight in the social domain while likely negatively weighted in the ethical domain, which i roughly interpret as representing universal values. This avoids the binary of good/bad and allows the diversity of a hundred flowers blooming. The net effect will probably be to dampen the practicing group’s index, nudging them toward more equitable standards. It is likely that many laws will become unnecessary and obsolete as people choose behavior that augments their NPV.
Q Could Bitcoin eventually morph into some sort of infrastructure for PI? Or that the infrastructure for Bitcoin could be used, adjusted, and adjust the math as well for PI?
A The only difference with Bitcoin over money is that it is entirely digital and supposedly, anonymous. Otherwise it has all the deficiencies and flaws of any currency. It is limited to a few, there is a finite amount, it privileges those that happen to have it, it exacerbates wealth disparity, it is unstable subject to the vagaries of casino speculation, feeds greed of profit-making, etc. etc. No faster than $ which is digital now but still complexity inadequate to process relationships.