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First Steps Towards Post scarcity: or Why the Current Financial Crisis is the End of the World As We Know It (And Why You Should Feel Fine)

It’s never easy to see your hard-won earnings disappear. When you open your 401K and see it’s just lost another 30%, you think: Holy moly, there goes my retirement. Yeah, it’s a natural reaction, but that doesn’t mean it’s the right one. We live in a world of accelerating change. Tomorrow won’t necessarily look anything like today. Not even slightly. In fact, it looks to me like the current financial crisis is the first step from a scarcity economy to a postscarcity scenario.

Let’s be clear on this. We’re not going to wake up in a magical world where iPods and McMansions grow on trees overnight. Before that can happen, every part of today’s value chain has to be overturned. Everything. Production of raw materials, transport and refining, design and engineering, manufacturing, distribution . . . even our own sense of worth. So, if today’s financial crisis is the first step, where do we go from here?

Keynesian? Marxist? With derivatives and CMOs and other abstractions propping up the value of investments, neither school of thought may be entirely valid. And with global population growth slowing, we’re going to have to re-evaluate the “good companies will be growing at 5% a year, forever” assumption that’s been the basis of corporate valuation.

We’re also already starting to see some examples of near post-scarcity. Consider computers and communications. If you’re willing to use a computer that’s a couple of years old, you can probably find a hand-me-down for free, and then happily talk to your friends around the world on Skype using free public wi-fi.

Or consider that in the last Depression, the main worry was simply getting enough food. Today, the marketplace is more worried about maintaining the marketing budgets of 170 different kinds of toothpaste than about ensuring that everyone has toothpaste. There’s a lot of padding in the system. Couple a financial crisis with this overweight, inefficient system, and you have the stage set for the first transition to post-scarcity: a comprehensive rethink of our concept of value.

Today, rappers sing about driving Bentleys, living in hotel-sized mansions, and drinking thousand-dollar bottles of cognac. Soon, they may be saying, “And that don’t mean shit unless you got viz and virt and rep!” We’ve already seen the beginning of this: divorce cases in which World of Warcraft’s internal currency is named as an asset; the growing importance of reputation systems such as eBay feedback; the proliferation of corporate “points” or “bux” systems that can be exchanged for real goods; the monetization of attention via friend-spamming on social networks and advertising on popular blogs. Our concept of value is expanding; it will expand even more in this phase.

Think about it. If real currency, virtual currency, corporate points, visibility, and reputation all have value, exchanges will soon crop up. Think of a FOREX (a market in which foreign currencies are exchanged) for all things we consider of value. As point examples of near post-scarcity grow and these value systems become interlocking, we’ll move beyond a single monetary value system. You’ll be able to live well under any number of value systems: reputation, visibility, network, rewards points, or even “old-fashioned” currency.

The second phase of the transition to post-scarcity is the scariest, but only if you look at it from today’s POV.

What’s hard to accept? Well, multiple interlocking value systems require comprehensive metrics and tracking. Read: surveillance. We could easily find ourselves in a propagational economy, where a person’s entire value is based on their Attention Index (their visibility to other people) and Monetization Effectiveness (how well they sell.)

Yuck," you say.

…divorce cases in which World of Warcraft’s internal currency is named as an asset; the proliferation of corporate “points”… our concept of value is expanding.

But what if advances in manufacturing efficiencies make it possible to live well, simply by interacting with friends and going about your life? What if below-replacement-level birthrates and advances in biotechnology meant you could check out of the system by claiming a piece of unused desert and planting a house? This surveillance economy might be a very easy place to live.

The end of this phase would come rapidly if Drexler-level nanomachines (molecular manufacturing) made the production of material stuff essentially free, and took the future worth of the entire value chain to zero. If it costs nothing to make the machines to find and refine the raw materials, or to grow the transportation network, two of the “insurmountable” obstacles to post-scarcity disappear. Even without this near-magical technology, bioassembly and other methods will slowly erode the value of raw materials refining, transportation, and manufacturing. In either case, this is an even bigger economic rethink than the one we’re going through today.

True nanotech is limited only by the energy we put into it. In this time, unthinkable mega-engineering projects become feasible: growing a global network for finding, refining, and transporting raw materials; producing hundreds of space elevators for easy access to extraterrestrial resources; assembling magical factories along every coastline.

In this phase: we are truly free to dream and big ideas are the currency. The dreamers and designers who can imagine the best ways to change the world will become the “economic” giants of their time. The big issue will be how to coordinate these visions, and to eliminate or minimize disruptive ones.

This phase ends when the systems for effortless production of all our dreams are in place. Artificial intelligences or powerful semantic processing make this unlimited capability accessible to anyone. We are now free to imagine what we want — and have it delivered on demand.

Speak your wishes to the air and it will deliver. The seamless nanotech/biotech skeins distributed through the earth and the solar system make every wish possible. The only remaining question: where do your rights end and someone else’s begin?

Now, sit back and think: even without life extension, I might see every phase of the transition to true post-scarcity in my lifetime. And remember that thought the next time you check your brokerage account. It is the end of the world as you know it. And that is perfectly fine.



  1. I absolutely agree…

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  3. Some ultra-rich people read this article. Probably the Koch brothers. They look at one another…

    “..damn we need to hurry. That’s 95% of humanity we need to euthanize in the next 20-30 years…!”

  4. “In fact, it looks to me like the current financial crisis is the first step from a scarcity economy to a postscarcity scenario.”
    When you wrote this two years ago, at the height of the crisis, that might have been a plausible outcome. Now that the crisis is somewhat under control, would you say that we’re heading in that direction, or did it all snap back to reality?

    I sourced this article when I wrote Exiting Industrialism, so I’d be intrigued to see where your projections end up.


  5. Hi,

    I’ve been looking into post-scarcity a while now, and link it strongly with an end to the need for any medium of exchange. You see economic giants being a part of the scenery in an environment where everything is available at no cost. So why money? Why corporations at all? Isn’t the trend (see Linux, OSS and loose non-hierarchical social-sites like flickr) towards decentralization? The way I understand it, you only need a medium of exchange to distribute scarce goods and services. Once they become abundant, there’s no point to money anymore. This of course entails other radical changes to the way society ticks, including an end to ownership, but you don’t seem to have looked into that aspect of scarcity and abundance.

    Have you looked at The Venus Project? Jacque Fresco has been talking about purposefully designing our way towards post-scarcity for decades. He sees the world quite differently to your interpretation.

    What I fail to understand in your vision is what humans will do to earn money when all goods and services can be produced without the need for human labor? The idea that we all scrabble about for attention like children does not appeal to me at all. Not all of us are comfortable in the limelight.


  6. Reminds me of “Forbidden Planet”.

  7. Hi everyone.

    Interresting article but for me it is still very unbelievable. But not because I disagree that scarcity will eventually diminish and vanish in a not too-distant future…

    It’s rather that the authors imagination of the future seems a bit disjointed and not really thought-through. It’s like those ridiculous cartoons of futurists where everything looks like in the 50’s but has rockets and jetpacks and gliding sidewalks… and phones with cords.

    Of cause no one knows or can know what the future looks like. Still I think especially the transition scenario will play out very differently…

    If you live in Germany -like me- you know that (with some exceptions) you are essentially entitled to payments from the state if you can’t get any work. As the robotics revolution continues and gradually more and more workers -first in production and later in the service sector- are replaced by machines, the state simply will have to pay their living expenses. Exactly like it’s already happening in many social democracies today. Perhaps everyone will be

    So what it will come down to at this point is that those people who “own” the means of production/robots will have to pay those who are out of work -if not out of social concern then surely to prevent bloody revolution. Of cause this is an extreme scenario with a clear-cut line between “producers” and “receivers” that we will hopefully solve in a social and civilized manner.

    The even more interresting question is how fast production robots themselves will be replaced by sophisticated 3D-printers. If you can simply print goods by dumping some readiliy available raw resource into a machine and reassembling it into a fully functional say …”laptop”… then the concept of money will just vanish.

    The genious of a “fully functional” 3D printer is that you’d have to build only ONE – it could cost 30 trillion $ to develop and build and it’d still be worth it. Because the second printer and every one thereafter is essentially completely free if you are smart enough to make the printers themselves slightly extensible in size.
    You’d also have to have the robotic means of supplying those printers with raw material and energy obviously. No biggie though once you can print those robots as well. Also at this point in time we surely won’t be limited to resources on earth.

    I do expect to see the day when material becomes just another form of information. Retirement provision my ass.

    But watch out of actual trojan horses with real little men inside your small microwave-like printer. And being Rickrolled by no less a figure than the man himself.

  8. Toby… I totally back you up on that one!

    Thank you for posting this!

  9. You are right to refer (albeit briefly) to Marx and Keynes because both, in their own way, referred to the prospect of a society where relatively scarcity of human needs (not wants) are minimised due to productive capacity.

    This aside however, there is one human need which remains outside of production and that is the fixed quantity of natural resources itself. Economic and physical battles will be fought over these resources in the 21st century whether literal wars (such as the ‘resource curse’ of Congo et al) and in the political arena (consider the debate over carbon taxes).

    The prophetic words of Rousseau (and Locke, and Paine etc) remain pertinent:

    “You are undone if you once forget that the fruits of the earth belong to us all, and the earth itself to no one.”

  10. A few things I’d like to state to some of the posts

    @ Lev. While I agree with you regarding the fact that we will eventually have to eliminate the concept of “private land ownership” because the EARTH as a whole belongs to all mankind, you are not taking into account another aspect of technological advancement. The ability to do MORE with LESS.

    We “use up” resources because today, when we make something from those resources, and once they have been allocated into a “product” those resources are more or less permanently “locked up” into that product. If we continued in this mode, your concerns about the earth having “finite” resources is accurate. It is however, a example of a static worldview. You are making the assumption that just because this is how it is done to today, that it will ALWAYS be done this way.

    We are rapidly moving away from this model though. Not only are more and more products being made that can be recycled, however imperfectly right now, we are also moving away from production methods that “waste” resources. a 3DPrinter (AKA Additive Manufacturing,) makes many current types of manufacturing obsolete. We don’t need to take a solid block of titanium and whittle away everything that’s not a gear, we can instead take titanium dust, and weld together only those particles that will be part of the final gear. As we progress over the next decade, most manufacturing processes are likely to shift towards additive methods. So point number one is that we are using less to make any particular product.

    Point number two is that we are also changing from relatively scarce materials needed to make many goods, to being able to use much much more common materials. We are about to enter the Graphene revolution, and I’m not talking about just for it’s potential use in computers. Graphene has structural abilities that make it a natural choice as a building material, and as we develop building techniques, we may begin making materials as strong as diamond, but which contain 60-90% open spaces like aerogels. While some products will still require materials other than pure carbon, the vast majority of produced goods could be made partially or wholly from graphene. Switching from a variety of “scarce” materials to one of the most abundant materials on the planet, in space, and across the universe, and using minuscule amounts of it to produce any given product will make a massive difference in the availability of resources. A car that today uses a ton of metal could tomorrow take a pound of carbon, and be safer, stronger, and far more economical to drive.

    Which brings me to point number three, recycling. I’m not talking about the rather lame kind we have today. I am speaking of true recycling. We are not very far from being able to make what is probably going to be the most basic primitive nanotechnology of them all, the ability to break down any material into component atoms, and sort those atoms into different types. No matter whether it’s synthetic lifeforms that can do it, or nanomechanical, the ability to recycle any material completely will eliminate nearly all scarcity of any material, because any item that is “disposed of” can be immediately broken down into atoms, separated into pure elements, and reused. Our junkyards, all of them, will be goldmines filled with over a hundred years of easy to access resources.

    And then there’s point four, metamorphic materials. While it is probably going to be at least a decade before we actually have materials that can actively change shape, and probably two or more before we have “utility fog”, it is still an inevitable development. This means that we could essentially reduce nearly every human structure into a “virtual object”, i.e. something that is ONLY THERE WHEN YOU ARE USING IT. Think about that. Think about a home that is only a ten foot cube but which has an infinite interior. The “fog” would keep you centered in the room, and render every single object within your reach, reducing everything outside of your reach into a graphic image. Every single object you touch will be real and solid, and only exist physically because you want it too. Your car could be your car, when it wasn’t being your boat, or your airplane, or your wings. It would be like living in a holodeck, and reduce the materials consumed by any one person to a tiny fraction of what they use now.

    These four points all show that current ideas of what constitutes “using up resources” are based on invalid assumptions about the future and current technological trends. While yes, those resources are finite, considering 100% recycling, orders of magnitude reductions in personal usage, and a shift to using hyper abundant materials, the likelihood of there being “resource wars” seems remote. Even attempts to create artificial scarcity will not be sustainable, as there are too many possible paths to each of the technologies I am talking about, and too much potential profit (despite that they will be rather short term as these technologies will also eliminate almost all value from material resources) to be made.

    Now, that being said, on to Scraps and Pieces.

    I tend to agree with 90% of what you said, but I would like to add the caveat that while material wealth will fall so far in value that human needs will drop out of the bottom of the market (being essentially free) that is a phase transition in that all value will merely transfer to non-material systems, like those mentioned in the article. It does not mean that every business model will vanish, merely that those based solely on the creation of material wealth are likely to die off, and those which rely on non-material wealth, like software or “content” creation, will undergo radical change or be out competed by newer companies, or even individuals who have now become competitive equals. There may still be organizations that resemble in structure current corporations, but the products produced and the profits reaped will be based on new “currencies”. So rather than saying that the author of this article is wrong, I would say that he’s got a limited view of all of the factors involved. He does suffer from some level of static worldview, but he has the basics right, so far as he goes.

    and now to Toby.

    The one thing I think the venus project misses is that the economy is merely a proxy for the human reproductive instinct, specifically the “pecking order” of social suitability to mate. Money, which at it’s most basic sense as a “medium of exchange” is nothing more than measure of the percentage of the collectively produced shared resources a single individual is “entitled too” out of the total pool. As such, it has become a proxy for the pecking order, in that high status people are almost always in possession of far more of the total available resources while low status people are denied access to these resources even though they help produce them. This is not going to change even if material goods lose all value, all human needs can be met for zero cost, or even if we discover a means to convert matter to energy and energy to matter and thus render all material resources infinite.

    We will simply alter what we use to define “value” but not eliminate mediums of exchange, because we are unlikely to change human competitive instincts, which means that we will continue to create pecking orders. (however, since we will also be creating the ability to alter our appearances, those pecking orders are going to going to get shook up in all kinds of ways before we settle down in new ones.) Thus, we will always have “Rich” and “Poor” it’s just that soon those definitions won’t determine life or death access to material resources needed to survive.

  11. …While I agree with you regarding the fact that we will eventually have to eliminate the concept of “private land ownership” because the EARTH as a whole belongs to all mankind…

    This long comment does not address the fundamental problem briefly acknowledged above. Fudging the issue of the private ownership of natural resource—including land as living space—makes other reforms into impotent pseudo-solutions.

    All surplus wealth flows into increased land values as rainfall ends up in rivers and seas. This is why the world is economically in a worse shape than 50 years ago (wages down, number of billionaires up).

  12. Money is not a medium of exchange, and a pecking order is not a natural instinct in humans which has total power over all others (whatever instincts really are).

    On money: It is a commodity seen as a medium of exchange. It is a poor (very poor) measure of value (e.g., air is priced at zero, as is genuine friendship, breast-feeding, etc.). A medium which is also a commodity (money is traded daily in the trillions) makes no real sense. I.e. an inch does not contain length, it merely measures it. If I buy an apple for a dollar, am I actually selling my dollar to the guy buying my dollar with his apple? If money were indeed a medium, it would not actually do anything physical in the transaction, only enable it. We could say our understaning of trade and value is a medium of exchange. Notes, coins and bits and bytes on computers are not.

    On instincts: Some alpha baboons were killed off in one blow because they had first access rights to thrown-away food outside a nearby restaurant. The troop became egalitarian. And still is some three decades later. Any new alphas that come along are trained into the new egalitarian system. So any instincts there may be (again, whatever instincts are) are not the sole determinants of behaviour. Similary, humans have only been hierarchical since farming. That is, they were egalitarian for the vast majority of their existence. See e.g. “Hierarchy in the Forest” by Christopher Boehm, or “The Art of Not Being Governed” by James Scott.

    As social systems change, so does behaviour. Abundance leads us away from money and hierarchy, towards open access and more egalitarian structures. And I believe we are seeing this happening thanks to the internet. It’s not that hierarchy is better or worse than anarchy, it’s that neither is as hard-wired into human ‘nature’ as you seem to think, Valkyrie Ice. And the Venus Project (though I do not support them totally) has looked into this part of the puzzle very deeply indeed. This part of the puzzle is penetrating the mainstream more and more:

  13. Land has value because of the resources it holds. I am going to have to assume you agree with this based on your comments. Those resources will always remain the same, but the value of that land rises and falls depending on how useful those resources are to mankind. Scarce resources are more valuable than common ones. Thats all part and parcel of our modern economy

    What happens to that value when those resources are no longer valuable? What happens to it’s use as living space when people can make a 10x10x10 cube become an infinite space? What happens to it’s functions as a “Rent Source” to billionaires when no-one has a need to rent it for any reason? When we can mine the very air to acquire all the atomic resources needed to enable anyone to survive, and to build nearly anything? What happens to “scarcity” when NOTHING IS SCARCE?

    Surplus wealth is soaked up by Rent seeking, not land value. Rent seeking is what sucks all excess profits out of production, as the land owners seek higher and higher rent for continued use of the exact same resources. As production improves in efficiency, and the “profits” that can be made for the same products increases, the “rent” charged eats those profits and keeps padding the pocketbooks of the land “owner” That “Land Value” is entirely based on the “rent” expected to be charged for use of that land. The housing bubble blew up because they were trading at anticipated land values in 60 to 70 years instead of current prices, and now those properties are nearly valueless. By the time this mortgage chicanery is over and done with, I think we are going to see some massive changes in the legal concepts of “personal land ownership”

    However, the reason that land has any value is going to vanish as self replicating 3D printers become common, and are quickly followed by nanoscale “Replicators”. Inside of 30 years the only real use for land will be living space, and even that will be minimal. All of which renders land “ownership” comparatively moot because like most other things, it won’t be “scarce”

    Those “pseudo-solutions” you were so quick to dismiss already answered your question if you understand the real source of “land value” and how “rent seeking” works. I suggest you read “Progress and Poverty” by Henry George. You might find it insightful.

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