Using taxes to earn respect

Taxation is the single most tangible aspect of government in most of our lives. Is it any wonder we've got a love-hate relationship with our nation--loving the theory while hating the implementation? It seems insane to me because it appears so needless and harms us so much. We have the know how to reverse that merely by tweaking the geometry of our economy. Today we tax productivity the most, and consumption the least, but why? Because by doing so we are throwing away the most powerful tool we have for evolving a more robust society. And by so recklessly and unfairly levying taxes we are needlessly alienating our own citizens and hindering the growth of our own economy and prosperity.

Taxes are disincentives. They can't help but be discouraging. Given this single fact doesn't it suggest we should tax those things with large positive externalities (like productivity) less at the expense of taxing those things that have large negative externalities (like crime) more? The very success of our society completely depends on our governments ability to define and maintain a suitable marketplace, or foundation, for us to develop commerce. This is an essential part of any serious attempt to do that. I want our leadership to connect the process of paying taxes to a new mechanism designed to protect our privacy and create a new income stream for us. Because it is necessary and because it is fair.

Taxing crime and our underground economy are easy things to accomplish in our modern world. Most of us both receive and spend most of the money we ever control electronically. The system we use today gives the banks and merchants a great deal of information about us that they can and do use to look for ways to motivate us to spend more, at best. The steps our government has taken to protect us from this exploitation are so pathetically inept they do little but add insult to injury.

Defending our privacy and property

But suppose our government allowed us to keep that information to ourselves. Suppose an agency of the government effectively stood between you and every entity you do business with. The seller gets no information from you other than what they actually need (usually just the fact that you paid,) and a code that identifies the transaction for all time. You get all of the information in a form that is completely accurate and verifiably unalterable after the fact. Rather than become a source of income for merchants, that information, or parts of it, can be sold by you in an open market of entities doing market research currently with information they purchase from merchants and banks, or by your doctor to get a sense of your lifestyle, recent travels, or other relevant data. And you also get a credit rating that is calculated by the government to open standards that academia can continuously critique and refine.

Why should our government do this? Because only it can. Because only it is in a position to craft legislation that defines such an organization in a way that convinces us it can't be abused, even by our own government. Only it can declare such a payment scheme as legal tender. And only it has the responsibility to protect our property as citizens in the first place. It currently fails badly at this, if not in a technical sense, at least in spirit. We constantly fall prey to the present accumulation of information about us by private enterprises with nothing but lip service paid to redress it. Creating an artifact to represent us in commerce is a simple, cheap, and very robust way to fix that problem immediately. It does more as well, from protecting us from pricing errors and shoddy merchants, to giving us a lot of insight on whether warranty coverage is worth buying, for example.

Constructive taxation

It's one of the reasons I think taxing the black market is such a good idea, because to do it requires that a number of other protections, like the above, be engineered into the economy all of which promise to leave us with significantly less overhead by adding a lot of negative and positive feedback in logical ways. By taking this approach to taxation we can vastly simplify the overhead necessary to pay for things (for both seller and buyer) while ensuring better information is collected and that no party (buyer, seller, or government) can be as easily defrauded or exploited.

I've mentioned several things in this blog that have this property, like our medical records, that are handled somewhat recklessly today for mostly historical reasons. This is a mechanism similar to the universal health care transactor I proposed to protect and maintain the privacy and integrity of our medical records and reduce the overhead of providing medical care. Throwing in our consumption data benefits everyone significantly. It gives medical researchers more information to look for correlations between lifestyle and health. It makes the information we have to sell more valuable to scientists, market researchers, and most of all us.

You might wonder why I'm so anxious to associate taxation with protecting your privacy. It's because I believe it's the right place to begin reforming the very soul of taxation--how we experience it. I want it to become something we take great pride in and feel wonderful about paying. I think the government should be giving us awards each time we achieve a new milestone in overall taxes paid. Starting with something as simple as a t-shirt proclaiming that a grateful nation thanks you for your first $10,000 contribution, to an annual parade for whomever manages to pay the most taxes concluding with an honorary dinner at The White House. I think there should be an academic industry that studies nothing but the externalities created by the way our taxes are apportioned and how perfectly they are collected, and a department of government independent of all the others for adjusting the tax code to match spending. It is an inherent conflict of interest to allow the people deciding what and how to spend to also decide where to get the funds. That seems unwise because it can only pollute the perspective they need to objectively decide what and how to spend. Only an independent and transparent agency is fit to determine how to most fairly levy the tax burden. It's an ongoing academic issue that can only be refined via careful study.

A bill for services

The deep fix for taxation is to transform it from a vague cloud that funds government into a bundle of connections that link benefits with the party enjoying them in ways we can explore and verify. This gives us so much more than the mere ability to feel better about paying them--it helps us make lifestyle choices and craft enterprises that are more inherently synergistic. It creates a whole new way to address issues like health care, social security, and welfare. It also forces government to come clean about how it uses it's non-tax revenue (which is probably a lot more than you might expect, easily more than $500/person/year today.)

The synergies go on. When all of these things are combined new opportunities are created. For example, with this approach the income from things like leasing the nations airwaves would ultimately become a credit in our tax accounts. For a minor it can do nothing but accumulate while compounding interest. This is an asset the state could use to fund incarceration of that individual should it become necessary, or to recover damages. Or it could fund a zero interest loan for education or to buy a home. It's a better way to incentivize good behavior from citizens; a carrot instead of a stick. It if was never allowed to go higher than what it would cost to purchase an insurance policy that covered your potential future liability to society, then it would become a source of income fastest to those of us who didn't get into trouble. And protect society from the cost of dealing with those that do.

Engendering love with respect

When it is possible to see exactly how our taxes are apportioned, managed, and spent--in great detail--we will be a position to feel better about paying them. When we can see that the apportionment has been carefully crafted to be as fair as we're capable of achieving then I believe people will honestly feel good about paying them. And when we experience taxation via a mechanism that is creating an income stream for us and protecting our privacy, then I think we'll actually look forward to it as a sort of score--or measure of our value to those who don't know us.

I believe a government that defines itself as being of the people, by the people, and for the people would realize that making all taxes voluntary is a relatively easy way to ensure that happens. And such a government would look for a way to make paying most taxes collectively voluntary simply because it realized that any government that isn't loved enough by its own citizens to compel them to pay for it really shouldn't last. This is a step towards unwinding the very need for as much government as we have now because it embeds some of the function of government into the process of just doing business.

Putting some soul into health care

My previous three posts have all been about health care. I'ld like to briefly summarize them here and then finish. In the first one I define a governmental agency, like the National Institute of Health, that would act as a transactor for every payment that can be considered a health care expense or a purchase of health care insurance and why I think it is such a wise approach to health care reform. In the second one I outline how that change would affect the basic components of our present health care system and better motivate them to focus on on their specific role, and not just any old way they might increase profits. (And assumed that the present practice of allowing employers to pay the health care expenses of their employees with pre-tax dollars was on its way out.)

In the third one, the previous post, I brought your attention to a particular node or place in cyberspace that would hold all of your medical information and suggested it should exist inside the transactor's databases because that is the most private information about us and that should be very important to our government to protect. The goal is to create an environment where that node actually becomes a personal life advocate for us. A sort of virtual personal assistant that remembers everything about us, has a nearly perfect knowledge of our health history, diet, habits, and myriads of other information that it can use to detect the sorts of things that correlate with opportunities for preventative medicine and make us aware of those choices.

Building a soul for ourselves in cyberspace

Health isn't just being physically fit. It's being educated enough to at least make informed health choices. It's having the infrastructure a person needs to function. Those things are just forms of preventative medicine. The real medicine we'd need by neglecting them is more expensive than the non-medical preventative medicine we need to treat them. If citizens are so important to their governments, how is it no government has even thought to create a computer program that looks for the people it can easily find, would benefit from help, and that it can easily afford to help? That's what this is. Nothing more than a task running on some server in cyberspace with no more to do than be there for you. It's job is to keep you as happy and healthy as you, and it, can figure out how to do.

Think of it as a crude attempt to create a soul for humanity designed to help us be us. We create this computer program that knows a lot about everyone, and uses that information to help us make wiser decisions. If, for example, your behavior changed in some way that correlated well with people who later had a medical problem, this little advocate will make you aware of it. Have a pain you don't understand? It might save you a visit to the doctor or direct the ambulance to where you're lying. If you wanted to change something about yourself, it could be of help since it could look for what worked for others like you that wanted the same thing and got there. If you wanted to learn something, same deal. It will be capable of whatever we are clever enough to teach it. As computers grow in power and software in sophistication I wouldn't be surprised if it renders the field of psychology utterly obsolete in just a few years by doing a much better job of helping us see ourselves clearly and make the changes we want.

The idea is to create a focal point, like the iPhone did, where everyone is invited to deploy their solution to help us be better people (or get more out of the device). Does this imply that I consider people devices? Yes, I suppose it does. Why is that a problem? Doesn't an actor want to get the most out of their instrument? I'm not suggesting we look for ways for others to get more out of you. Just how we can enable you to get the most out of you. No one is going to use an iPhone application that they find annoying. It's the same thing here. If the sort of software that emerges from a system like this was a nuisance, who would use it? Okay, I suppose masochists would love it. But they can almost certainly find devices already that are better suited to amuse them.

Creating the incentive to empower us

Like the iPhone, I'm advocating a standardized forum where anyone can deploy software they believe would be useful helping people become better. We will be the ones to decide how we interact with the data made available this way, and the developers of the software we choose to use will be paid a tiny amount per user by the transactor. The first applications will most likely be electronic patient advocates that help people avoid treatment mistakes (like taking a drug while you are using a different drug that is incompatible,) follow progress, and be sources of information, encouragement, and a connection to supporters. But I would expect lots of stuff to emerge, from software that helps kids do well in school or learn an instrument, to ones that teach adults how to eat more wisely or cope with tragedy.

I see these things as going a long way to lowering the level of overall uncertainty and stress in our lives. I think collectively they'd lead to substantially lower health care costs and healthier longer lives for most people. I also think they would push many other boundaries that limit the opportunities that appear to us and thereby increase the growth rate of our economy.

But most importantly, I see this as a solution we can adopt very quickly and without undue immediate impact (other than starting to phase out employer paid health care.) We can even delay the flow of insurance premiums through the provider to give that industry time to come up with standardized contracts, computer procedures and the other infrastructure needed for a smooth transition. The providers should be routed that way as quickly as possible because there is simply no reason not to. The limiting factor there is to standardize the format of medical information and design and deploy equipment well suited for error-proof collection and delivery of it. All of that should happen regardless of what we do because we need that information for so many things--from better evaluating the efficacy of treatments to the competency of practitioners.

I should also note that I've pretty much avoided any discussion of funding mainly because this suggestion is actually independent of how health care costs are ultimately reckoned with. This is just about how we might get the most out of whatever we do decide to spend.

Resistance is meaninglessness

The most useful things I know of are all actually just tokens for metaphysical entities. Like words, formulas, money, contracts, and yeah, I suppose, even people. And although every bit of their utility never leaves the metaphysical realm, they don't become very usable until they have a functioning physical form.

A meme isn't even knowable by it's holder until we have a word or phrase that can adequately contain it. A fact about the structure of our world isn't all that much more tangible even after we've outfitted it with a perfectly tailored formula. It can take a great deal of training just to see a blurred image of it. And cash seems more real to us that the real things we trade it for that seem mostly fake! This should amaze us.

Contracts can actually be too real. And people aren't just real, their physical manifestation can even be nice, naughty, or if you're really lucky, both. My only point in all of this is to illustrate what wonderful things can happen when something metaphysical somehow gets inside a body that suits it. Because I think that trick might just lead us to a great deal more than cheaper health care.

So I've long wondered what metaphysical concept, property, or idea could be embodied into a tangible entity whose presence in our environment would just naturally lead to our becoming deeply enfranchised. (Whenever I ask my wife something like this she looks at me or responds like I've been caught preparing to torture her. It's not easy to discuss this stuff.)

I stumbled onto what I think might be a solution when I was looking at what a mess my room had become and wishing I had a copy of me to do all the things I didn't feel like doing but knew I should do. I know I could tell the clone what it ought to be doing and that it would agree because it could see I had much more important things to do. But by that point I didn't want my clone to do any work because I wanted his complete attention while I explained what seemed like a clever way to solve the problem I mentioned above. Besides, if my room wasn't such a mess I wouldn't have stumbled in the first place.

Competing with your virtual clone

I realized that if we are all better at telling ourselves what to do than we are at doing it ourselves, then maybe, if we could make a virtual copy of ourselves more tangible, we could use it to improve ourselves. It could be a very natural, private, and compelling process--if the only way to endow my avatar with a property was to achieve it in real life then I might be onto something. And I started to look for ways that might work.

Then I noticed that my soul is already in cyberspace (well, bits of it), why not just make it official as a tangible presence for ourselves by pulling those bits together? We can do that to some extent already at sites like facebook and youtube, but I'm picturing a node, or URI, that's connected in various ways to a great deal more. The safest node in cyberspace is the one that represents us in the universal health care transactor I described earlier.

You can't secure liberties without robustly engineering them into the fabric of society. You already have lots of nodes that represent you in cyberspace. I'm not too happy about that. In fact, you might say I'm sort of ticked off that our government is so careless about defending our privacy and the integrity of our identity. Just because it's more intangible than I am doesn't mean it's not rather important to me. And just because the bits of your soul are presently scattered about cyberspace doesn't mean that a clever piece of software can't box them together faster than you can say 'unholy packet.'

Giving our souls an address in cyberspace is the best way to ensure our government puts protecting them above even us. We just have to ensure that if they fail there is no longer a way for them to collect our taxes. It's the ultimate identity protector because it need never share anything the identifier doesn't have a need to know. If the software running the database is open source, and can be proven by anyone to be correct, and the mechanisms is uses to protect us from even the most sophisticated attempts of our own government to get at it are verifiably robust, I believe we will be a lot better off than if we leave things to our leadership to work out. This is a technology that needs to emerge from academia fully tested and ready for governments to deploy or be left out of a new economic reality.

I guess I never got to what I promised in the prior post--a mechanism whereby we encourage ourselves to make wiser health care choices. Whoops. Maybe I'll make it there with the next one. Right now I'd like to bite something resembling food.