Sunday, September 25, 2005

Budgets of Choice

Recently I’ve been aware of how badly the government spends money, disaster preparedness (FEMA and hurricane Rita), Homeland Security funds, the FBI’s $170 million “Virtual Case File System” that didn’t work, and the recent pork in the transportation bill. Why is it that the government spends money so poorly?

I suspect it has to do with something called “Tragedy of the Commons”. The idea is like this … some organization decides to go to dinner and agrees to split the bill evenly. Each individual buys something a little more expensive than they would normally, but in the end the total bill is more than it would be if each individual paid their own way. The same thing happens with people in government. They all try and get as much of the pie as possible to keep their constituents happy or their departments well funded. In the end we spend more money on more than we need to.

So how do we solve this ? One idea is to police the spending of money more thoroughly. You could create a Department of Fiscal Responsibility that has the authority to change budgets, but in some ways that just moves the problem from Senators, Congressmen, and bureaucrats to a new set of bureaucrats who would be less concerned about the money they were spending than a Senator or Congressman running for re-election. Another option is to create voter awareness of how money is spent in hopes that better representatives will be elected.

What is a government budget anyway? It’s mandatory financial participation for the civic good, doing those things that require collective action, roads, bridges, schools, prisons, military, foreign relations, health, and law enforcement. The way it works now, we take all our money and put it in one big pot and elect someone else to spend it. What if we could spend it?

The sytem works like this. Everyone is required to spend a certain amount. The budget would be broken down into categories and subcategories with minimums set on each category. Each person would choose how to allocate their money to each of the categories. As each dollar is spent the government tells you exactly what it was spent on. If you don’t like how its spent, the next time you move it somewhere else or even perhaps to another agency that does the same thing. Perhaps you can change your allocation each month to reflect changing circumstances. At the end of the year you could look and see how the government spent your individual dollars and you’d have a better idea of how good a job they did. Government bureaucracies that are wasteful would have budget problems and competing agencies that did a better job would grow to take their place or assist in their restructuring in order to regain the confidence of the public.

Most of all if money is spent badly, there is a fraction of the population that will know about it and make changes to prevent it from happening again.

Saturday, September 17, 2005

Are you doing what you are best at?

Choice is good. Whenever there is a lack of choice you get things like monopolies, dead end jobs, bad marriages, general misery all the way around. The free market helps to increase choice. Company A is run by a machiavellian tyrant who does everything in his power to force people to buy his products which are bad. Company B is formed, makes a better product, puts company A out of business. Societal meritocracy and justice at its best. A kind of economic democracy where people vote with their dollars and decisions on what gets made and how.

But it doesn’t always work. Lots of things have to fall into place to create something new , like a company. You have to find the right people with the right skills, investors, someone with a vision for how to put it all together. And here too having lots of choices makes things better.

Why do we work anyway? Well to put a roof over our heads and food on the table of course, but what then? Nicer roofs and nicer food on nicer tables ? For most people that’s not enough. We have to do something that matters in some deep way. All that deep stuff that bounces through your head at night when you look at the stars, when you see people suffering in some far away country and say to yourself things aren’t right. Humanity can be so much more. There is allot of broken, backward ass stuff that perpetuates on and on and on.

So how do we get there? Who decides where there is? Don’t know. But I know choice is good. And I know that the more choices that someone has the more likely they will be better off tomorrow. So imagine this, every resource and every opportunity being know by everyone. Say there is hurricane. People need food and shelter. All the inventories of food that is available is known. All the people willing to donate money is known. All the trucks and boats available is known. All the people to drive the trucks, known, all the locations of where people need food, known, all the people willing to distribute the food, known. And most importantly the integrity of everyone to make sure that money is not wasted is known. And even better, no government to manage it, just people doing it. People voting with their time and resources, self organizing.

And this applies to what people do everyday. Are you in the right job? Does what you do matter or are you just working for a paycheck. What if you knew of all the job opportunities around all the stuff that really mattered to you. What if you could connect with all the people wanting to do something and create opportunities?

The Internet can do this. Connect everything. Find everything. Fix everything.