Small investments – in defense of capitalism.

The critics of capitalism rightly state that 1% of the population has most of the world’s wealth, and that owners of capital have monetary power to employ the working class, and then take away most fruits of their labor… cause the poor people are powerless to do anything other than work for the capitalists.

But hey, is that really the case? I think not, and the poor do have the power to change their lives… if they accept that wealthy people are wealthy for a reason.

Of course some rich people are cronies, that live of government’s support and externalize costs of their businesses to the society. But as the economy gets more sophisticated, it doesn’t neccessarily need to rely on one branch… and some of the seemingly monopolistic branches are fed by customers.

  1. Spend less than you make. That’s the crucial rule, that will allow you to put aside some money. It will also decrease the capitalist’s power, if you are able to avoid the charm of mass-advertising, and lets you choose what you will build with your money later. But in itself it is not sufficient.
  2. Work smarter, find ways to leverage your work, maximise it’s output and utilize it more than once. It starts with as simple steps as reading some books to specialize in one’s work and being better than that, to changing the employer once you gain practice if the existing one treats you poorly. Try placing yourself in the position of manager (if there’s a clear path of advance in your company and you trust it), or do something entirely different.
  3. Cut back on costly habits. A beer a day, which millions of average people drink, doesn’t seem like much, but it will decimate your already small savings. The same applies to smoking, going to clubs etc. Go work out and read a book instead.
  4. Cut back on TV, Facebook, blogs, YouTube and even Wikipedia. Choose quality content.
    While being informed and stimulated seems like a good idea, and is educational in general, it places you in the position of consumer of culture. And while you consume, you cannot produce. Meanwhile some wealthy people concentrate on producing more wealth.
  5. Live as efficiently as possible. Sacrifice bits of comfort.
    Not many poor people seem to care about the small savings or investments like energy efficient appliances. If the price of LED light bulb still turns you off, think about all the carbon emissions it will save, and the corresponding energy bill. If public transport fees or car costs bring you down, consider if you could live happily in a more cosy apartment, closer to the city center. It might seem costly to buy square meters at exorbitant price, but if you think you see some value in the city you live in, many people of your nationality will see it in the future.
    Maybe you’ll own a very, very small flat instead of a bigger one but hey, do you really want to pay mortgage, and heating, and tax, and transportation costs for something that large? Driving to and from work will take away at least an hour of your day so… it’s not worth it, however little you earn you’ll have less time for productive activities.
  6. Go beyond that, think like an entrepreneur.
    For sure you know something that could make your life, and the lives of people around you easier. Maybe it’s a service that you would happily use, and you know how to provide. Or a good which you would buy. Or some absurdity in the world, which could be fixed if a business got started, or if people used a product that doesn’t even exist.
    Than think again, and if it’s something that is legal, safe and you could do it… why don’t you give it a shot?
  7. Invest smart.
    There were many entities that change the world around us, from the established businesses (shops, cafes, barbers, hairdresses, florists, construction companies, mechanics workshops) to the technological disruptors (such as Uber, the Internet, cryptocurrencies etc.). Beware of tricksters and manipulators which promise you easy money in the things you don’t understand… but if you do understand some issues and therefore you think you are able to predict the future needs of the people, why not giving a business or investing a try?
    OK, some things that you will do will seem crazy and meaningless. Your friends and family might not believe in you, cause you might have some failed experiences. Maybe it’s not a perfect moment to dump your stable job but… if you feel that you can do something better than you did before, then do it! And please, be obsessed about reading and educating yourself in the right direction. It will pay sooner or later.

Tragedies of cities regulated by the state.

Urbanisation is the process of people concentrating in one area, to get more access to each other. People live in one place for multiple reasons:

  • To have access to workplaces in high-traffic are or concentrated facilities.
  • To have access to entertainment, culture and social opportunities.
  • To meet sexual partners and/or form families.
  • To live closer to places of shopping, consumption and services.

Concentration in one place helps people to have more access to other people and resources, while using less energy for transportation. Therefore it’s natural that land value increases in dense cities, as well as real estate prices.

Unfortunately many wannabe urbanists and architects, want us to live in an esthetic, planned environment. This restricts the possibility of bulding high-risers in cities, and has multiple adverse effects.

First of all, decreasing the ability to build tall buildings causes room price to rise, and land price to rise. This drives people out of the city centre, to the suburbs.
People living in the suburbs quickly grow addicted to automobiles and public transportation to move around. Walking and cycling doesn’t suffice for them.

And this causes multitudes of evils. First, people vote for building the infrastructure much needed for their mobility. Roads costs billions, and so do buses, trams and trains. It all comes from taxes, which discourages productivity, as unfortunately governments tend to tax work and profit, instead of violent misdemeanors.
Heck, they even punish victimless crimes too!

Then, there is noise and air pollution resulting from traffic, which makes the city centre less attractive. Also land use discourages more dense construction. You need space to have roads, railroads and parking for cars. And this requires even more energy for transportation, and even more environmental effects.

And who will complain about the environmental effects most? I think the political left, who voted for land-use and spatial planning in the first place… The same left who wants rich people to pay taxes for infrastructure, will also complain about exorbitant profits of car making and oil drilling corporations.

If we were to apply free market and non-aggression principles to cities, you would be allowed to do everything you wish. However living far from city centre is less profitable because:

  • You have to personally pay not only for fuel, but also for private roads, so the driving is discourage.
  • You have to buy electric car soon, because road-owner can get sued for emissions from traffic.
  • On the contrary you can buy flats in city centre quite cheaply, as many real estate investors build very high buildings to maximise area possible to sell.
    They also make sure that everybody has a heat pump or district heating, to maximise the building’s attractiveness.
  • Everybody is free to trade every good and service without even a registered business and paying taxes for their works, which maximises everybody’s profit and social cohesion. The rich no longer have to be tired of the average, which vote against them… and will be allowed to make any transaction and share business knowledge more freely.
  • Because hiring process gets easier and work more profitable, businesses have better access to employees, and workforce has better access to job opportunities. Gone is the formalised job market, you are free to interact in a gig economy, where everybody is encouraged to be an independent contractor, or even a startup owner. Even if it is only making beer and dumplings at home, you are free to do it for bitcoins etc.
  • The freedom extends to the smaller houses surrounding the city core, which are allowed to generate energy (provided that it is not environmentally harmful, so no outdated smoky furnaces), food, build machines or whatever the city centre needs and wants from land. Energy generation is no longer constrained to subsidised power plants, and as it is untaxed and decentralised – it gets cheaper and more accessible for consumer.
  • Lack of regulation (other than noise and pollution) allows more people to provide taxi service for the city dwellers, who no longer need and own car (and would have to pay for road access). It maximises capital utilisation.
  • Freedom to provide to education might encourage charlatans if people get intellectually lazy… but as everybody is encouraged to do productive work parents will watch out for their children and children for their parents. It’s easier to manipulate people who are always forbidden to do something, than people who live in a world of open opportunities and discipline required by productive economy.
  • Cheap good and services mean, that even minimal work can provide good living standard. People will not compete with robots… they will just use them if they are sufficiently cheap. Also, living in the land will always be cheaper than living in the city, because only in the land you can generate solar and wind energy.

Isn’t the free market a great urban planner?

Fiscal freedom is the only ethical choice.

How is someone able to earn money liable for those that cannot do it?
In other words, why should anybody have to pay for others?

Think about it for a second. As far as there are many un-ethical ways to earn money, the only good way to do it is solving other peoples’ problems, by providing valuable goods and services.
It doesn’t matter what goods and services, business must provide (sell) more value that it consumes to be successful and make owner rich. And in perfect case there should be a voluntary exchange where smart people buy things for their benefit.

So, it a consumer is educated, knows his goals and needs, only businesses doing good things for people will be revarded. Otherwise consumer breeds bad businesses with his own money.

Governments around the world also want to solve some problems. That’s why they tax people to extract money needed for work on solutions. But is that really fair to take away what somebody got from others, because he got more than others?

I think not, if there’s no proof that a rich man did something wrong. If he does then fine, please take away his money so that wrongdoings are not profitable. Instead of punishing for being profitable and ethical, consider setting incentives for good behavior.

To eliminate societal wrongs, Governments might precisely tax the wrongdoings, not the production.

Why make tarrifs for imported food, and subsidies for local food? Is there any moral superity of local farmers, instead of the overseas farmer? Is the populace better of without the access to cheaper food?

Why subsidise renewable energy, which is taxed anyway, when you can just tax carbon emissions? You can fill up the treasury and promote green energy at the same time.

Why tax capital gains and inflate currency if you can let people trade freely without invoices and receipts? You can still tax and fine people if they are proven to do anything wrong, but let them make profit on doing good.

But to fulfill the entire potential of capitalism, one would need some mental revolution. Government will not change itself if people don’t demand the change. And people won’t, if they don’t see how they will be better off after the change.
Change is possible, I have undergone it myself. What is crucial, is unwinding some old habits of thinking which don’t help. One you are re-wind and think productively, you demand everybody to be productive. And help those who temporarily are not, to become the ones. The road is very long, but it is worth it. Everybody can better manage their lives, time and money. It’s just a matter of knowing, what you must know.