I have found Douglass Carmichael's notes (http://tmn.com/y2k) on the Y2K problem to be a welcome relief to the large amount of superficial information that gets repeated over and over again in the media and on the net.I was having a coffee this morning and reviewing my local Ottawa Citizen when I found another article in the Business Section on the Y2K problem. Ho Hum, with all the problems I am concerned about, this seemed a long way from many of my interests but I scanned it - same old stuff, we have a problem, we may have a catastrophe, someone should do something, the government is taking care of their systems, etc.. Then up to my computer and a quick read of my E Mail. A short posting by Doug Carmicheal, a web site posting, oh well, I will take a couple of minutes to see what he has to say. As I read through the lengthy document, I found quotes that triggered a need to cut and paste, just because they jogged me in ways that I was looking at other problems. The following is a series of the cut and paste I took out of Doug's Web page and on which I will make some comments.
One of the observations in today's email from him that I could identify with was this:
"As you work on the problem, you learn more. As your sphere of knowledge expands, your sphere of ignorance (what you know that you do not know) expands faster. If I discover that the Y2K issues for Windows 95 will impact my company in a known way, I now also have uncertainty about these issues in other organizations. Ultimately, one realizes that there is a lot about how the world functions that one never knew before Y2k."
Not only that, I would add, there are things I know that I can't tell anyone else for several reasons, which I also cannot divulge. see how it works?
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Another statement by Carmichael has also got me thinking about a discussion on electronic currencies and LETS (Local Employment and Trading Systems) that took place quite a while ago here on Futurework with Keith Hudson.
In "Year 2000: who will do what and when and when will they do it?"
at (http://tmn.com/~doug), Carmichael wrote:
" By 2020 world wages will have evened out quite a bit, and production
at a distance ceases to be so profitable. Then local production emerges
quickly as the preferred solution. This means that each geographical
area becomes the preferred place to produce. That means that community
can be organized for work, education, and (hopefully smarter) consumption,
in a much tighter cycle than we have had for a good part of this century,
maybe even including much of the 19th. Citizen comes back into the
identity of normal people who have a reason to participate because the
town is becoming a coherent entity."
Now, not wanting to debate the merits or likelihood of what Carmichael
wrote, especially because I've cut out all the context for the quote (Read
the article!), I just wanted to make a connection to a posting by Keith
Hudson that gives us some insight into the kind of world we might be facing
post-2000.
What I have begun to suspect is that Keith's scenario of 'rapid and overt' introduction of electronic currencies will prove to be the correct one because the post-2000 problems, wide-spread business failures and high inflation will present the ideal conditions for entrepreneurs/criminal organizations to establish new institutions based on new paradigms to replace the dead-dead old ones. I wonder if what is happening in Russia now is an early example of this trend, that is, if the wealthy criminals can manage to introduce the humble beginnings of a functional banking system for the people, or whether the country is "winding down in an entropic decay." Here in North America, we have the advantage of newer infrastructure and some rules to go along with that, which increase the chances of success of the introduction of competing electronic currencies as parts of the infrastructure are brought back on-line post-2000.?Date: Fri, 03 Jan 1997 09:59:10 +0000 From: Keith Hudson <[EMAIL PROTECTED]> To: Designing for POST-INDUSTRIAL REALITIES <[EMAIL PROTECTED]> Subject: Re: FW: Electronic currencies I refer to Eric Lawton's posting of 2.1.97. WHAT ELECTRONIC CURRENCY(IES) ARE WE TALKING ABOUT? Both Eric and I are not talking about electronic versions of existing national currencies (I'll call this e-money) -- this has been with us for some time already and will increase simply as a matter of convenience and lower transaction costs. We are talking about the possibility of brand new currencies that are issued by non-national entities (I'll call this e-currency) -- the modern version of what banks used to do until about 300 years ago. WHERE WE AGREE We both agree that it is now technologically possible for new currencies to come into existence relatively cheaply (compared with the huge investments that would be required in starting, say, a traditional bank with all its obvious overheads). (We probably also agree that whatever is technologically possible will inevitably occur if there is a financial incentive.) We both agree, too, that because of strong encryption, if new e-currencies came into existence then its movements would be hidden from governments. For all we know, there may already be substantial flows of e-money (not e-currencies) between the international mafia and also between the trading departments of very large TNCs (though most unlikely in my view -- apart from the normal habit of shifting money around to reduce taxation). This is e-money, so far, and not e-currency, because it has still got to be introduced into the financial system by laundering ordinary money. Once it's in the financial system, however, it then becomes invisible to governments and only becomes visible again when it surfaces again as ordinary money and is spent. We also agree that if, in some way, some e-money becomes genuine e-currency, then the habit of disguising money movements will increase (to avoid taxation of all sorts) and spread sideways and downwards to commerce and ordinary people. If only a small amount of e-currency gets launched, then it is capable of growing to become a sizeable proportion of the total because the "invisible" part of the economy (services of various sorts) is also growing. We also agree that if this occurs, then it is gradually going to put the squeeze on anybody who is not firmly linked into the main economy. In other words, because of reduced government taxation, then state welfare benefits will decline to a level that can only be supplied by taxation of visible assets (for example, real estate or cars, boats, aeroplanes, etc) and publicly available services. (I happen to think that this form of taxation is highly desirable over the long term because it will concentrate our minds much more than hitherto on the physical and environmental aspects of our economic activities. But in the short-to-medium term this will be increasingly hard on those who are not in the economic system. Eric Lawton is therefore quite right to be concerned and this is why this topic is important to FW List.) WHERE WE DISAGREE Given that e-currencies are probably inevitable one day, Eric and I disagree, it seems, on how this will come about. This could be important because the time-scales might be quite different. I think I'm correct in assuming that Eric things that e-currencies will drift in in some way (as implied in the preceding section). I'm not at all sure how this can happen, but it's possible I suppose. The important point is that if it does happen this way, it is likely to become substantial only over two or three or four generations (as increasing numbers of people gradually become integrated into the increasingly "invisible" or service part of the economy). If, however, it comes in rapidly and overtly at some stage and on a sufficiently large scale -- as I'm slightly inclined to think -- then we have much more reason to worry because it will involve everybody with a direct link to the economy but not those outside it. It will thus polarise society dramatically. The existing poor will suffer badly unless they can bootstrap themselves quickly into new skills. The scenario by which this could happen is if the present 'strong-money' governments lose control of their official currencies and begin competitive inflation because of internal social unrest. At the moment I cannot see how advanced governments can escape the squeeze between increasing deficits, increasing resistance to taxation, and increasing welfare dependency and old age pensions.
Eric Lawton
