A Celebration Society

Tag: charter cities

  • For-Profit Cities vs. ACS

    To be clear, we’re not opposed to for-profit enterprises or to capitalism as a principle. We believe that ACS will become the crowning glory of capitalism, eventually completing it into what Adam Smith envisioned as a world of “universal opulence”, where people continue to play capitalist games as they may please, consistent with a given society’s Charter. (We expect that, like Lewis Carroll’s Cheshire Cat, capitalism will over time become more and more gamified and less and less significant in any practical sense, until eventually all that remains is the smile.)

    However, those who favor competitive capitalism, as opposed to monopoly or oligopoly, will recognize that the label of “capitalism”, like nearly all labels in the modern world, can be and has been hijacked to serve particular narrow ideological purposes. For example, even though some like to label the Scandinavian countries as “socialist”, that is false. They are–being descriptive and not ideological– social democracies with capitalist economic systems.

    Any system in which the residents decide voluntarily and consensually how that system operates in a manner respectful of others is agreeable to us, and potentially could become ACS.

    In truth, there are no purely “capitalist” systems on Earth. Well, almost none.

    Recently, some “for-profit” charter cities have emerged, generally in specific venues designated as politically and economically free zones under contract with existing nation-states. In this design feature of a long-term lease with independent government, similar to Hong Kong under its agreement with Britain, we are aligned.

    That said, using Prospera, a for-profit libertarian city on coastal Honduras as a representative example, there are many significant differences:

    LAWS AND REGULATIONS

    Prospera. Has a 4,202 page set of “laws” that one must agree to uphold, merely to enter the city.

    ACS. Each ACS will have its own Charter, a statement of Principles which all of its residents will swear (or solemnly affirm) to support. Visitors will similarly affirm, for the limited and specified duration of their visit. (We cannot imagine any Charter exceeding a few pages, though a body of plainly stated and briefly worded laws will also be enacted, always consistent with the Charter.)

    SOURCES OF INCOME

    Prospera. Most of their income comes from allowing people to incorporate businesses domiciled legally in Prospera that don’t actually exist in any physical form. While such businesses may be legally valid and even ethical, this is rife with potential for abuse.

    Further, Prospera disrespects certain laws of their host country in favor of profit. (Example: a 14-story building when its host country Honduras caps building heights at 7 stories. Granted, this was contractually allowed. But is it respectful?)

    All profit stays in the hands of the businesspeople of Prospera, or the owners of Prospera, not the host country, so it’s extractive.

    ACS. We favor a commitment to a mutually respectful, mutually beneficial and long-term oriented relationship with each such host country, where the establishing agreement is viewed more in the Japanese manner of a source from which understandings evolve rather than as something cast in stone, awaiting litigation to settle differences, per the American legal model.

    Each ACS will be founded with at least two different sources of revenue flowing from that ACS to its host country: (1) A long-term (e.g. 99 year) lease fee, or purchase price, for the land, and (2) An annual payment from the gross revenues of the ACS to the host. We envision this as 3% of the revenues.

    In addition, we see each ACS as becoming a major tourist destination, with by way of example six-star restaurants offering gourmet cuisine available nowhere else in the world. This will become possible due to local, automated greenhouse growing of a number of the 1,800 fruits and vegetables now available for cultivation but not cultivated due to difficulties in growing, transportation, or storage. Only about 200 fruits and vegetables are currently grown commercially. Difficulties in growing can be greatly reduced through automated 24/7 use of sensors, robots, and AIs governing the robots; all supplemented by humans who enjoy the hobby of tending plants. Transportation and storage issues disappear with food locally grown, then harvested for immediate consumption.

    LEGAL SYSTEM

    Prospera. Doesn’t have a court system, but rather an arbitration board. We are uncertain how they handle those found at fault, but a for-profit jail with very long sentences for infractions considered minor elsewhere would not be against their principles. (Note that, in the US, for-profit prisons are not only a major industry, but are allowed to pay lobbyists and make campaign donations to lawmakers who then legislate into existence new crimes or lengthen the prison sentences for existing crimes. This is a perversion of justice, by any reasonable and caring understanding.)

    ACS. Each ACS will have its own judicial system, with an emphasis on speedy, fair hearings (meaning: the same treatment for all, regardless of wealth or connections). In addition, the whole system will emphasize prevention, restoration, remediation, and atonement.

    Never will justice be punitive, with arrest and segregation from the population–when necessary–handled with compassion and respect.

    The presumption in ACS is that most conflicts are misunderstandings. Arbitration will be available, with judges as required. Given that all necessities will be provided to all by the automated systems of production, theft will be rare. Rather than heavy-handed laws and regulations, ACS will emphasize nudges toward behaviors consistent with its Charter, both through cultural aspects and use of complementary currencies.

    CULTURE

    Prospera. It appears that, in Prospera, anything not expressly prohibited by its 4,202 pages of laws is permitted. This would presumably, by way of example, include such things as: garish or jarring public-facing decorations or architecture, odd clothing (or nudity), smoking, loudness, and so forth. (Caveat: we haven’t read those laws, and we suspect that almost no one does.)

    ACS. Everything in ACS will be established through consensus of its initial residents, then evolve based upon changes to its laws and its Charter (rare and difficult, but much easier to change than the US Constitution) made by the Citizens, who will be its government.

    ACS will not be privately owned societies, but rather each will exist under a legal compact valid under international law. ACS will support private ownership of land, of means of production, and of objects and enterprises, consistent with its Charter. All activities will be permitted that are not prohibited by the Charter or by a specific law subordinate to the Charter.

    TRANSPARENCY

    Prospera. There is apparently zero transparency in Prospera. This leads to many issues with trust.

    ACS. Everything not expressly designated as Private will, by default, be public. Public means transparent. To assure safety of the young, the elderly, and other at-risk persons, there will be universal surveillance in designated Public areas, with surveillance in Private areas only by consent of all adults present or a particular court-issued warrant. All financial transactions will be electronic and traceable, to minimize tax evasion, and thereby support very low tax rates.

    CONCLUSION

    Prospera aims to increase the wealth of already wealthy people by circumventing existing government laws and regulations, and by exporting profits out of the country. There will be some wealth generated for citizens of the host country, but it will be a fraction of the whole.

    ACS aims to increase the prosperity of all residents (noting that Citizen is an office, hard-earned and available to all residents). By giving to the host country a fixed percentage of its gross revenues, as well as including selected elements of the host country’s culture, ACS aims to create a permanent partnership valuable for both sides. In addition, certain citizens of the host country who wish to help found that particular ACS will receive the benefits of living there, provided they abide by its Charter.

    Residents of ACS will found numerous corporations, headquartered in the ACS, enjoying low, fixed tax rates and streamlined regulations–not no regulations. Each such corporation will be expected to operate in accordance with the Charter, to transparently report its cash flows, accepting and paying only in traceable electronic monies, and to donate at minimum 10% of annual profits to the general welfare fund. Through this and a simple flat tax, administered fairly, in accordance with Adam Smith’s Maxims of Good Taxation, the society will invest in public works which make it a pleasant place to live and work, and one in which–like Singapore–public service workers are well-compensated, respected, and impartial.

    Those already wealthy will be welcome to live in ACS and to invest there. Their property rights will be fully respected, consistent with Charter compliance. Those who become wealthy will be lauded, given that their wealth will be generated not extractively but through honorable, enlightened service to others.

  • Celebration Societies or Charter Cities?

    Celebration Societies or Charter Cities?

    There has been much discussion of Paul Romer’s charter cities, and an experiment of this sort may be taking shape in the Honduras– though not one to Romer’s liking. I expect that people will want to compare celebration society city states to charter cities. I wish to facilitate this comparison, highlighting important differences and showing why these differences matter. First, there are certain important similarities.

    Charter cities work on the basis of capitalism, essentially seeking to transport successful first-world models of investment and development to less developed regions of the world. Romer argues that this is how the British lease of Hong Kong brought prosperity to that city state. Capitalism will also enable the creation of early celebration societies.

    In both cases, an outside party will be given control of a small portion of a nation’s territory in exchange for the promise of significant economic improvement. In both cases, establishing consistent and transparent rule of law is considered paramount. In both cases, the outside party will establish its own system of government.

    Here are the differences that I see:

    1) Long-time residents of the host country do not need to be worried about being “kicked out” by the foreigners. Celebration Society cities will offer displaced residents the choice of either becoming residents of the new society (with the ability to become Citizens just like any other resident) or an above-fair-market-value settlement for their land to help them relocate elsewhere within the host country.

    2) Rather than generating profit only for outside investors, the Celebration Society will continue to contribute a direct share of its revenues to the host country.  (If the first celebration societies not only showcase a superior quality of life but also significantly benefit their host countries, that combination will facilitate the creation of additional societies.)

    3) A Celebration Society will be owned by its residents and governed by its Citizens. Outside investors may be offered long-term concessions on infrastructure projects, but never ownership of the society itself.

    4) The population of a charter city will basically come from the host country. The vast majority of the populace of a Celebration Society would likely be immigrants from other countries; at least in the initial cases. (While it is possible that a single host country could itself populate a new Celebration Society, making that a restriction would increase the challenge of collecting the vast number of escrow funders/residents needed.))

    5) Rather than companies bearing the cost of initial construction and improvement, then reaping the benefits of the city’s productivity, the cost of initial construction and improvement for Celebration Society cities will be borne by a combination of resident investment and tip-it-forward funds from existing Celebration Society cities; potentially supplemented by impact investors who are as concerned about the success of the experiment as their own ROI. As a result, the city’s profits flow back to the residents less what is shared with the host country. (Note: Profits from individual companies owned by residents will still flow to the owners of those companies, less taxes.)

    6) The investors in a charter city would be in a favored position. The nature of the Celebration Society government prevents power blocs and entrenched interests from gaining control. It would still be possible for a company to bribe individual members of Parliament to vote favorable laws. However since those laws would be transparent, and have a waiting period before they become permanent, it becomes significantly more difficult to maintain unfair laws that favor a company over other companies or the general populace.

    7) Further, once bribes were recognized, the company and its executives and owners would probably be expelled for violating the Charter. Therefore, it would be a last-ditch emergency tactic rather than standard operating procedure. Likewise, with a monetary system that is envisioned as being all-electronic, blockchain-based and traceable, bribes would probably have to be paid in money that is never repatriated to the celebration society. This would create considerable problems both for the payor and the recipient(s) of such a bribe.

    8) Some critics have expressed concern that organized crime might flourish in charter cities. Organized crime in general (AKA racketeering) requires minions to be effective. Such minions must perceive that their expected reward from the criminal activity exceeds the risk. As an early Celebration Society gradually shifts from capitalism to celebrationism, the incentives of criminal activity will become less appealing and the perceived risks greater. With their basic needs met by the celebrationist production system, few residents will risk their opportunity to live in one of the most pleasant places on Earth merely for the chance at illicit gains that they do not need.

    Eventually, I expect that celebration societies will be created not only as new city states in largely uninhabited land, but also as “retrofits” to existing societies. At that point, the comparison to charter cities will break down. However, this welcome development is years and probably decades in the future.

    Caveat: I have read only a limited amount about charter cities, and it is possible that some proposed charter city designs will address some of the differences I have highlighted.