In this article we analyze Babel economy more in depth. We explain the reason behind this model, how it works and address some critiques.
🔗Managing scarce resources
In the words of French economist and politician Raymond Barre:
Economics is the science of managing scarce resources. It examines the forms taken by human behavior in the management of these resources; analyzes and explains the ways in which an individual or a society allocates limited means to the satisfaction of multiple and unlimited needs.
The main goal of any economic system must be to efficiently manage scarce resources and at the same time keep our unlimited desires under control.
Managing is all about making decisions and setting up the right processes. Better the decisions we make, greater would be the efficiency.
Greater the amount of information at our disposal, better decisions we'll make.
Be aware that every limited resource can be employed for different production goals. For example, on a piece of land we could build a house, a skyscraper, a supermarket, or perhaps use it to farm grains, fruit trees, leave it to nature, etc...
The best way to allocate resources should tell us how to best satisfy our unlimited desires. Because desires are unlimited, we already know that we'll never fully satisfy them, hence we need to prioritize as much as possible.
People have different preferences and rank desires differently: I like spicy food, while you may hate it. Prioritization is done as a best effort, in an attempt to balance all the different and sometimes contrasting desires of people.
Another important factor is that environment influences desires: in Siberia we defend against extreme cold, while in Ethiopia we defend against the sweltering heat. Environment also impacts what resources are available: some places are rich in drinkable water, while in others it's a precious resource.
As if all of this wasn't complex enough to balance, our needs and desires are always changing: what's important today may be useless tomorrow. Whatever distribution we find, it will always be a fleeting approximation.
The best resource allocation method is one that can be applied often and gives enough satisfaction to as many people as possible. Thus, an economic model that satisfies 10% of the population is, by definition, a very bad one.
🔗Main goal
The main goal of Babel economy is to provide an economic model best suited to the society we want to build. Instead of letting economy shape our society we do the opposite, we let our values shape the economy.
Indeed, we have little interest in the most productive allocation of resources if the result is a society full of misery and suffer.
Our core values are the foundation of our economic system, with particular emphasis on freedom and collaboration.
We applied to economy one of the golden rules of software design: make wrong states irrepresentable; we want a system impossible to corrupt and exploit, without poverty, one where criminal activities are unmotivated. We want an economy where people can thrive and become the best versions of themselves.
Spoiler alert: the result is nothing new, greatly similar to what anarchist communists popularized by the end of the ninetieth century.
Taking all in consideration, our main design decision is: an individual's quality of life is strictly bound to society's quality of life.
Society's quality of life is in turn bound to all the efforts poured in by its members. This setup creates a virtuous positive feedback loop where to improve our life we actively and indirectly improve the life of everyone else. Don't worry if this concept is still unclear, we'll further explain it in the rest of the article.
We believe this formula plays well with the different aspects of human nature, for example both egoism and altruism can be put up to good work in this model.
Every emotion and aspect of human nature is important, every sentiment necessary, worth to have and explore. Our job as human beings is to balance and harmonize our multifaceted nature into a beautiful character. Like in music, a beautiful melody isn't one only composed by high or low notes, but one where all notes have their place and time, skillfully choreographed into a delightful opera.
🔗Why not a market economy?
Market economies have serious flaws, all caused by a single design decision: an individual's quality of life is strictly bound to how good of a seller they are.
This highly individualistic economic model is the cause of a plethora of social issues and therefore incompatible with our main goal.
🔗Why not a planned economy?
A planned economy can be either centralized or decentralized.
They both share the creation and commitment to an economic-wide plan.
The centralized version tends to be highly authoritarian, and this is strongly against our core values.
The decentralized ones are more flexible and at first glance seem to better fit our main goal. The issue is that all derived economic models, such as participatory economics and negotieted planning, still abide to the logic of distributing products according to some rules.
The desire to reward different people differently, despite their strive for the most just way, it is not only a Sisyphean endeavor, but a perilous one: it embraces the idea that people should be graded and divided, it justify that some should have more than others, that some deserve better.
As we have explained in What we deserve, we see things differently.
🔗Sustainability
Many production activities when done without care can be detrimental to our environment.
A management of scarce resources that doesn't consider a sustainable cycle of production and consumption is a short-sighted and self-destructive one. Such carelessness is what brought upon us the global climate crisis, which could potentially wipe-out humanity from Earth.
This is why creating a circular economy is extremely important. All goods and services produced within Babel must be designed taking into consideration their entire life cycle, with particular attention to ecological sustainability.
It is important to keep an eye on the ability to repair and recycle each product as much as possible. This is inline with the understanding that resources are limited, hence we want to make the most out of what we have available.
Recovering materials is crucial. Think about how many precious resources are wasted, transformed into garbage and hazardous waste, in the name of a technological advancement driven by individualistic greed.
The distribution of new products must be balanced by its sustainability. Rather than mass-producing every insignificant innovation, it would be more appropriate to focus on research and limit mass production to significant improvements.
There is little value in switching to a more powerful smartphone if we then use it in the same old way. By focusing on research and innovation rather than mass-production we can have better products in less time, while spending less resources.
🔗Track & Adapt
Even though market and planned economics are antipodes, there are stark similarities on how businesses are run.
It doesn't matter the chosen economic model, whenever we want to produce something we must choose a production method, which in turn dictates inputs, outputs and final quality of our product.
How to choose depends in part on our environment and the available resources. As we said, our environment changes over time, hence it is essential to track how well we are doing, and use these data to adapt our production to keep and improve efficiency. In capitalism this process is done by each business individually, while in a planned economy the information is shared with everyone else. The point is, this is a fundamental process.
Babel economy wants to declutter this truth from any accidental complexity to maximize its effectiveness.
We can electronically track all the resources produced and consumed by both producers and individual consumers. All data are organized geographically and freely accessible by anyone.
Equipped with this information, individual producers can have a clear understanding of the whole economy at different granularity levels, allowing them to efficiently adapt their production line as needed.
We want to be crystal clear that the role of tracking is limited to production improvement. Tracking isn't a way to restrict what people can consume, otherwise it wouldn't be a free and fair system.
🔗Resources allocation
Still the question remains: how do we allocate different resources?
Remember that our main design decision imposes that an individual's quality of life is strictly bound to society's quality of life, thus the most natural way to allocate resources is for everything to be shared and freely accessible, both the means of production and the results of our efforts.
It is important to understand that consumption is completely disconnected from one's production and effort.
If we would follow the old logic of giving different economic power to different people according to a set of rules, then each individual would work hard to maximize their own gains, to manipulate the system to favor them. Only by making everything freely accessible we can let our intrinsic greed work for the greater-good rather than for our individual gains. Once everything is free, every innovation, every improvement, all spent efforts will be to the benefits of society as a whole.
Everything must be free for us to attain real freedom and foster mutual aid.
Times are changing and thanks to technological improvements, we can achieve such a society at large scale. Long gone are the times when a drought would starve an entire village. Today technology allow us to easily satisfy the needs of every person alive.
Let us further explain how we organize consumption and production.
🔗Consumption
We said that one's desires are infinite and yet we allow everyone to consume as they please; isn't this a mad recipe for shortages and bloody conflicts? We need to dig deeper.
It is true that we have infinite desires, however when we look at a single product, our desire towards it is finite. We may crave an apple now, but once we get it our desire is satisfied, we don't need an infinite amount of apples. If we can access apples whenever we want, there is no need to hoard them, actually that would require more effort: we need storage space, to transport them and dispose of those that rot away.
The real issue is when we perceive that there aren't enough apples to satisfy everyone: the fear of missing out can bring out our worst behaviors, especially when our basic needs are threatened. This is what we need to solve.
In Babel we have several mechanisms to cope with that.
🔗Active involvement
Babel emphasizes active involvement. If our desires aren't met by our current production, then it is up to us to satisfy them.
For example, suppose that there isn't enough bread in our community due to lack of bakeries. If we perceive it as a big lack, then it would be normal in Babel to join a bakery and learn the trade, or perhaps research how to produce more bread, or even by getting together the right people for a new bakery.
How we solve the issue depends on our aptitudes, but the point is to act upon a problem we care for, solving it for both ourselves and the community. By satisfying our personal desire, we also satisfy that desire for many more people. This is the spirit of our main design principle.
Others will help and follow, but it's up to each of us to improve our community. Don't wait for others, act!
🔗Prediction
Because we track everything, once we accrue enough data we can statistically predict future consumption for each product and adapt our production accordingly.
It is especially important to track all missed consumption, i.e. all those instances where we couldn't get enough of a product.
Statistics, linear programming, artificial intelligence and all other tools that will come up in the future can greatly help us refine our production lines, but it is ultimately up to producers to decide on how to do their job.
🔗Soft limits
In case it isn't possible to increase production right away, we can limit how much a person should consumes.
Thanks to all information available, society can come up with a good limit per person, in accordance with the needs of those interested in a product (demand) and those who produce it (supply).
Limits are discussed by geographical area, given that different areas face different challenges and needs.
It is paramount that all the interested people (consumers and producers) participate in setting up and agree on the actual limit. This ensures that everyone will respect and commit to it.
For example, we could agree to a limit of 3kg apples per week per person. Because consumption is tracked at individual level, it is easy to set it up.
It is inevitable that some people will consume less than 3kg, while others will crave for more. If we impose a strict limit, on the same day we could have both unsatisfied people and apples left to rot. Unsatisfied people would perceive it as a shortage, hence we wouldn't have solved much. We don't want to push people into theft, but rather prevent it.
The limit should be considered as an indication that we are over-consuming and that we should adjust our behavior. Given that we all agreed on the limit together, it would be antisocial and even awkward for people to constantly go over it.
Nonetheless everyone has different needs, hence it should be possible to individually adjust limits. For example, children may need to consume more apples to ensure a healthy growth. The reason isn't important, what's important is that the special cases are discussed and agreed upon by all involved.
Not all products need limits, only those that are at risk of shortages.
After a while, we can revise the limit and eventually address cases of severe over-consumption at social level.
🔗Preorders & Waiting lists
There may be goods that take time to produce or aren't suited for continuous production. For example, we only need a set amount of smartphones at a given time. Instead of overproducing them, with the risk of wasting precious resources on a model that may go obsolete, we can place an order whenever we need it.
All orders are fulfilled on a first come, first served manner. Depending on the nature of the goods, orders may be shared across many producers (standard production method) or be specific to a single shop (custom-made products).
In special cases, waiting lists may be prioritized according to some rule to ensure better distribution. For example, in case of a pandemic it is better to give higher priority to the more vulnerable. As always, we rely on our best judgment and tweak the tools available to best solve the issue at hand.
As everything in Babel, waiting lists are transparent, everyone can see their place in it and the system should estimate how long may take before we receive the goods.
This strategy is flexible and can be applied to all products. For example, we can book a table at our preferred restaurant on a given date, as we can reserve 1kg apples for next Thursday, etc...
Preorders and estimated waiting times are important indicators to adjust production.
🔗How would it look like?
In practice there will be stores, both physical and online as we are used today, but there will be no money. Every person has an identification key, similar to today ID cards, that is used to acquire whatever we desire and help track consumption.
Imagine to enter in a store, get all the groceries we need, scanning each item as we go as already happen in many supermarkets, and then just go back home. No cashier and check-in are needed because everything is free. With the right technology we can even remove the need to manually scan each product, as Amazon already experimented with "Just Walk Out Shopping".
Scanning an item is important, but tracking is limited to statistical purposes, hence if we accidentally miss some data point is no big deal on the large scale.
Through our smartphone we'll have easy access to a detailed product page, with all the information necessary to decide which product better fit our preferences. Each product also has a section for people reviews.
As you can see, it isn't much different than today experience, but we do away with all the stress caused by market economies.
🔗Imported products
Consumption in Babel isn't limited to what is produced internally. Even though we have a soft spot for autonomy, the world is vast and resources scattered around, hence importing goods will always be necessary, even once society grows up to a large scale. International collaboration is as important as local collaboration.
No special rules apply to imported products, even though they would be harder to get and therefore subject to greater scarcity.
Every person can decide on what imported products they want by opening a project, specifying all the details. This gives people the opportunity to join and express their support. Depending on how many people joins, society could delegate somebody to reach out to the producer to cut a good deal. Even if only a single person is interested, and as long as the product isn't harmful and we have enough money, it can be imported as a one-off purchase.
In case of regularly consumed products, we can set-up regular imports and distribute it to any store interested.
If society doesn't have enough money, then projects will be prioritized as usual, based on number of people interested and which one was opened first.
🔗Mindful consumption
One interesting result of this arrangement is that it can foster a mindful consumption, one where people avoid hoarding or obsess over products.
Consumerism, typical of capitalism, is the worst consumption arrangement because it incite people to consume without refrains. As you know already, resources are limited, hence infinite consumption is unsustainable. Consumerism exists mainly because producers need to sell as much as they can, that's the only way they have to get more money, and money is essential to have better lives in capitalism.
People are therefore transformed into consumers, their role is to consume as much as they can, thus the focus on things. More things you have, more luxuries you can afford, better would be your social status.
This madness is dismantled in Babel, because we removed its main ingredients by making everything free. This single fundamental change is enough to remove profits, exclusiveness and struggle to acquire a product, rendering consumerism meaningless.
We can go back to a more humane and sustainable mode of consumption, one where products are just a way to achieve a greater goal, rather than the goal itself. Mindful consumption ensures that people get just what they need to live a meaningful life, making life experiences much more important than mundane objects.
Consumption and production are the face of the same medal, hence mindful consumption ensures that we only need to produce those products that makes sense, reducing waste. It is yet another virtuous cycle.
🔗Production
We mentioned that economy main objective is to satisfy the desires of people in the best possible way. Indeed, there is no reason to produce something nobody cares for. It is always desire that drives production, and who's better than ourselves to satisfy our own desires?
In Babel more than in other societies, there is an emphasis on acting upon what we want, while society support us to make it happen. It naturally follows that all production is in the direct hand of each person.
Let's see how it works out.
🔗Efficiency vs Satisfaction
One aspect often underestimated is that our satisfaction greatly depends on our contribution to society, on the work we do. The act itself of creating something, of achieving something, is way more rewarding than consuming it.
In a capitalistic society whenever we want something so expensive that we can't afford it, we work hard for it. More work we need to do, more work we do, and more our desire increases. The excitement peaks just before we get it, when we can almost touch the finish line but aren't there yet. Once we get it our satisfaction soon withers away.
The main source of our excitement and satisfaction isn't the product itself, but rather all the sweat and work we have done to acquire it. We enjoyed the journey that brought us there.
However, not all work is the same. Think about intensive animal farming: who sane in mind would like to work in such a cruel environment? We do it only out of sheer necessity, because we have no other alternative but to sell our labor to survive.
On the other hand, a more humane approach to animal husbandry can be a rewarding way of life, which has the positive side-effect of producing much better and genuine products for all.
Intensive animal farming is just a poster-child of a society dedicated to infinite growth, which is in stark contrast with the reality of finite resources. It is the result of obsessing over production efficiency and profits.
We want to invert this trend, and instead prefer a less efficient production method if it's more satisfying to work with.
Suppose we are passionate about chairs made in wood, with a nice look & feel, and that we enjoy making each chair by hand. Both in planned and market economies this would be a hard business to sell because it doesn't scale and there are more efficient way to produce chairs.
In Babel we can open a project explaining our idea, and once we gather the right skills and materials, that's it. The nature of production by hand means that we need simpler tools and fewer materials, making it simpler to start it up.
We could decide to work on it alone, or perhaps setup a workshop where many enthusiasts gather and collaborate. Our passion for these chairs will ensure we create a nice working environment and have extra care for the final product.
Granted, not all chairs will be built by hand. As long as a chair looks nice and is comfortable, most people don't care how it's produced, also not everyone like to produce it by hand, preferring instead more common industrial methodologies better suited for scale.
The point is that we don't have to sacrifice satisfaction for mindless efficiency. The most important aspect of production in Babel is to enjoy both our work and the final product it produces.
🔗Knowledge
In Babel we have at our disposal the full knowledge available in society, both in form of data and experience of other people. If we are uncertain on how to produce something, the first step would be to discuss it in the public online forum.
In this way we can also gauge how many people share our same interest, see if there is already a similar project going on, past experiences, etc...
Of course, discussions don't have to be limited online, we encourage in person chats to speed up the process and better connect with other people.
Nonetheless it is better to record all important information online to have better history and reach a wider audience, both in space and time.
🔗Production projects
Once we have clear in mind what we want to do and how to do it, it's time to open a project.
We specify in great detail all the resources we need, what production method we'll employ, what skills and technologies we need, how the supply chain would look like, preconditions, etc... More information we give, easier would be the discussion. The system will then propagate the new project to all people that may be interested in it.
The amount of details required to start a new business is similar to any other economic model, capitalism included.
The main goal of a project isn't to get permission, but rather to improve the initial idea, check its feasibility and ensure it's inline with our core values. A project in proposal phase isn't expected to have worked out all details, for example supply chains are usually shaped up in this phase.
It's up to the initial proponent to promote the idea and gather all the support required for its realization.
The proponent however isn't the owner of the project nor product, everyone interested will have the same stake on it, both during its planning phase and once it is up and running.
🔗Adapting
Let's say the population in our area grows and we need to produce more bread. We can reach out to our flour suppliers and ask them for more. If they have spare capacity, then all good.
Otherwise, this necessity may trigger one or more projects to improve production in other industries. It will have a cascading effect throughout the whole supply chain and potentially the whole society.
That's how we can choreograph a large scale change starting from individual needs. Each production group decides for itself on how to improve production, ensuring autonomy while avoiding strict coordination between millions of people. All we need to agree on is the new numbers we need to reach, that's all. Incidentally, this is the same mechanism used by market economies.
🔗How would it look like?
Suppose we finally finished a research on a new type of grain. It is time to start production and reap the fruits of our labor.
We open a production project and soon people involved in agriculture show up, asking further question on how it works, and willing to try the new variety. All together we decide on which fields would be best to run the first crop, then come up with the initial requirements for number of seeds and all other resources needed.
Sadly there isn't enough fertilizer available, but after some inquiry, a couple of farmers agree to divert a quota of fertilizer on this project. We are thankful and good to go.
We are thrilled to see how our grains will fare in the world first-hand, hence we join the farm and work together with everyone for a period of time before going back to research.
As you can see, there is a good degree of collaboration involved. The researcher wouldn't be able to setup the whole supply chain and work the field alone, but thanks to others' capabilities, expertise and goodwill, they are able to create something new and improve life for all. Here again we can see how our main design principle applies.
🔗Economic growth
The quantity of goods produced by society will determine the quality of life of each member of our society.
We are confident that focus on collaboration, education and research will trigger a virtuous cycle that can achieve unprecedented levels of well-being.
However theory and reality often diverge. It is hard to predict all the challenges that our system will face, nonetheless values such as greater collaboration and freedom are more important to us than exceptional economic growth.
We accept the fact that we may never reach a level of opulence comparable to capitalism's top 1%, but this is by design rather than a problem.
The purpose of Babel isn't to create a highly productive system, but rather a society where everyone has all they need to reach for their own happiness.
Happiness is a state of the mind, often fired up by succeeding in our intentions, by finishing something we are proud of or are satisfied with, in perfect line with our crafty nature. Once the basic needs are guaranteed, happiness has very little to do with how many and what kind of products we have.
🔗Everything is a Gift
Because everything is free, all we have and will receive is a gift from society.
Money and contracts creates a sense of entitlement: "I have worked for it, so I can waste all these food if I want to", "I'm paying sound cash, why are you so slow at making my burger?!", "The customer is always right".
This sense of entitlement creates ugly wrinkles on how we approach and judge people. Low-paid jobs are particularly degraded, even though they often contribute way more to society than many well-paid Bullshit Jobs.
The truth is that no matter the economic model, without people's sweat of the brow and their collaboration, we would still be stuck in the Stone Age.
We must be grateful to whoever toiled in the fields, to those who built our house, sewed our clothes, paved our roads and provided us with all we need to live a meaningful life.
Babel makes this fundamental truth more evident and emphasize the beneficial psychology behind gifts.
Gifts are a marvelous thing, they let us feel cared for, create a connection, improve our sense of belonging and cause a strong sense of obligation. Gifts are deeply rooted in our history and part of every culture. This is the same foundation of Gift economy, which however is quite different than what we are presenting.
It's important to understand that the power of gift isn't in the given object, but rather on the act itself of doing something for someone else. The resulting sense of gratitude, we are sure, will oblige us to contribute back to society as much as we can.
🔗Tourism
Tourism is an excellent vector for change, a way to show the world the quality of our society. All tourists are welcomed, from any country and region of the world.
Tourists have to register and purchase standard packages that give them limited access to what society has to offer. It is similar to soft limits, but it uses a hard limit instead. Guests can always expand their packages for a fee if they exhaust their quotas. This will also help us acquire foreign currency useful for importing resources.
The pricing of those packages may be based on prices back in the original countries, so to be more inclusive.
🔗Conclusions
By applying this economic system we are efficiently coping with our infinite desires while gathering all the necessary information to continually improve production.
This socioeconomic arrangement render a plethora of issues impossible, to name a few:
- Poverty: everyone has what is available, thus there cannot be poverty.
- Unemployment: everyone can work on what they like, improving overall production.
- Theft: everything is free, thus we can't steal anything.
- Economic corruption: there is nothing we could give to somebody else to force them to do what we want.
- Economic discrimination: everyone will have as much as everyone else, making any discrimination based on wealth impossible.
- Black markets: there will be no customs or illegal goods, hence no need for black markets.
The most important issue solved is pollution. The greatest cause of pollution today isn't due to a lack of green technology, but rather people profit more by not using them.
Those who decide to poison the river live far, far away from it, and thus don't care the least about it. Notwithstanding the elimination of the profit motive, given that all production in Babel is under the responsibility of local people, nobody sane in mind would poison the river they use for water.
Babel creates the perfect environment to reduce and completely eliminate pollution. This alone should bring this kind of economic systems more into discussion.
🔗Critiques
🔗It doesn't account for the Economic Calculation Problem.
The Economic Calculation Problem states that to be able to efficiently manage resources allocation, and thus provide society with a great life, we must have a market with prices.
When Ludwig von Mises formulated his critique, it was mainly comparing capitalism against the centralized planned economics in vogue in Soviet Union. As we already explained in Managing scarce resources, resources allocation is indeed a very tough problem to crack and we agree that it is unfeasible for a small group of people to come up with even a sufficient distribution. This was further demonstrated by the many economic shortcomings in both USSR and China due to lack of transparent and precise information.
The reason however has nothing to do with lack of prices nor markets, but rather with information processing. A small group of people can't possibly account for all the vagaries of the society their are catering for, thus producing sub-optimal decisions.
This issue doesn't apply to Babel, or any other economic model that tends to be decentralized. As we explained in Track & Adapt, every economic model is always affected by these two fundamental processes, hence if the economic calculation problem would apply to Babel, it would further apply to any other economic model, capitalism included.
Every business in market economies must gather data and insights on the markets they operate in, and always keep an eye on the metrics specific to their own business, such as customer satisfaction, churned customers, production rates, how and where money are spent, how many people we reach with last advertisement campaign, and so on. As you can see, prices are just a tiny part of all data.
Suppose that there is an increase in prices for one of our essential input resource. According to von Mises, this would be enough to let us change our production, but is it? As we know, it is the chosen production method that dictates input resources, but also the quality and quantity of products we produce. Changing one of the inputs means we have to change the production method, which will then impact quality and quantity, and may even require different technologies and different skills. Even supposing we can easily change production method, is the increase in price stable or will it soon go back? In other terms, why the price changed? Even though prices may let us reconsider our options, it's just the start of the story: a worthy business will have to consider many other aspects before making a decision.
Once we abstract prices into the "data" bucket, we see that markets operate in very similar manner to how Babel operates. Instead of having to look at prices, these potential changes will be triggered by simple communication. Remember that prices changes due to change in external factors, such as a ruined crop. When this happens in Babel, the affected producers will not be able to fulfill their agreed part of the supply chain and thus promptly contact all the interested people.
This is a more social and effective way of handling the issue, because in markets prices are further subjected to speculation, which makes people take decisions that sometimes are against society well-being. For example, when prices go down, producers are encouraged to store their product away, waiting for a better price to sell, creating an artificial scarcity that help rise the price back. However they may decide to withhold product even when prices are going up. The underlying logical reasoning is the same: why should I sell at $10 today when I could sell at $12 tomorrow? This happens more often than you may expect, and is especially profitable for big corps who have the necessary storage means.
In both cases, markets are worsening consumers' life because they now have to pay more money for something that should cost less, and sometimes products will be even completely inaccessible. Thus, distribution becomes less efficient than in Babel.
🔗Excessive reliance on technology. As soon as there is a bug, and there will be, everything will fall apart.
It is true that technology is well integrated in Babel, we believe it is essential to allow efficient resource management at scale.
We understand that it is easy to over-rely on technology and build a system that locks us away in case of issues, that's why this is a good concern, and one we need to keep in mind when designing all systems.
However, we track resources only to improve our knowledge of the economy. In case of an issue in the system people must still be allowed to get whatever they need, we may lose some data and perhaps some of our statistics will be wrong, but because decision is still in people's hands, it is no big deal, we can compensate for it. The worst thing that may happen would be for some stores to have a delay in their supply, but nothing a good chat can't resolve.
Such is the system we have in mind.
If we exclude the high scale from the picture, a small community can apply this economic system with just pen & paper, by simply discussing in person about what is needed. It will be less efficient, but still better than capitalism.
🔗People will fight hard for the best X
Here X is anything with limited availability, such as a house nearby the sea.
This is a legit concern in capitalism, where social status is flaunted through luxurious items. They also wrongly teach us that any emotional void can be filled through materialistic consumption. As we already explained in Mindful consumption, consumerism has no place in Babel.
When it comes to goods of different quality, there is no place for poor quality products because there are no poor people forced to consume it.
If required, houses with beautiful view could be reserved as vacation houses, available to all through waiting lists. Mansions and the lot will have no reason to exist because they require lots of maintenance that in a capitalistic society is filled by cheap, exploitative labor.
The most productive and fertile soil will produce for everyone, hence there is no reason to fight over it.
Most importantly, once we have our material needs covered and disconnected from social esteem, luxury would be less of a concern, an extravaganza.
Don't get us wrong, though: it doesn't mean that all products are exactly the same, that everything is homologated to a boring standard.
Quite the contrary, society will offer all that we need to experiment and express the full might of our creativity. There will be variations of the same product, but each will have a defining characteristic, an intrinsic usefulness that goes beyond the brand.
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