This is an interesting discussion, where I think that both you and Brian are correct based upon the assumptions you make.

It was also useful to have Arthur Brock’s first-rate ‘Prezi’ to help put things into historic context, and to throw ‘information’ into the Economic pot.

Every economic analysis is based upon fundamental assumptions…as J A Wheeler said:

‘Reality is defined by the questions you put to it”.

My view of an An Economics of Common Sense is also incorporated into this holistic presentation at Strathclyde University on
Economic Systems Thinking

I find the distinction between the material and the immaterial useful, and I will elaborate upon it when developing my thinking in relation to the three ‘Factors of Production’ which in my analysis underpin the Economy.

Firstly, there is Location, as in 3D Space. The greater part of economic value historically has been based upon the value of the exclusive use of Location. For instance, two thirds of dollars in existence came into existence as mortgage loans and I refer to it as ‘deficit-based’ (by credit intermediaries aka banks) but ‘land/location-backed’.

Location is immaterial.

Secondly, there is Energy, which for the purposes of this analysis is the ‘material’ world, although energy may be instantaneously immaterial when in dynamic form it passes through Location.

Finally, and developing at a phenomenal rate, there is ‘Knowledge’.

I see Knowledge as existing in both subjective and objective forms.

Subjective knowledge is essentially what sits between our ears and dies with us: it includes information; common sense; intuition; creativity; experience; contacts; and much else.

It is immaterial, and exists in the bio-chemical/energetic patterns which animate our (material) brains.

In my analysis, the greater part of ‘Labour’ is in fact the use value of subjective Knowledge, while the balance of Labour value comprises what Keynes referred to as ‘unqualified Labour’. I see this ‘manpower’ as Energy.

Objective Knowledge consists of patterns of data which are recorded in one form or another, and include art; software; video; audio and so on. This is ‘immaterial’ although it may be expressed in material form eg sculpture and architecture are valuable data patterns expressed in material form.

This objective Knowledge is – due to direct instantaneous P2P connection – increasing in extent and value at an exponential rate.

I believe that having pretty much reached Peak Stuff – which is Brian’s point – at the zenith (or is it nadir?) of our current centralised but connected Economy 2.0 – we will now be proceeding rapidly into a decentralised but connected Knowledge Economy 3.0.

The fuel for this economy will be what Amory Lovins calls ‘Nega Watts’. ie we will from here on be ‘mining’ energy savings and using better combinations of Knowledge and Location to do so.

Through the optimal use of Location and Knowledge we will aim to transition from our current unsustainable use of non-renewable material energy resources to sustainable use of immaterial energy resources.

I believe that the only way in which this may be achieved is a Commons approach not just to Knowledge, but also to Location and Energy.

In order to achieve this we need new consensual protocols – Legal XML – linking disparate enterprises and jurisdictions in the same way that XML links disparate hardware and software.

Within these frameworks we may directly (without credit interemdiaries) ‘monetise’ the use value of the three factors of production simply through the creation and exchange of Units (undated credits) redeemable in payment for the use of them.

This exchange requires a ‘Unit of Account’ or value standard, by reference to which exchanges may be priced, and in my view this will be an absolute Unit of energy in an amount to which the average person can relate.

Note here that such a standard Unit of measure for Value is not a currency, but is akin to a kilogramme as a standard of measure of length, and a metre as a standard of measure for length. There can be no shortage of a standard, although there can be shortages of currency if based on artificial scarcity – as with the existing financial system, or upon finite resources eg gold or other non-renewables.