Improving Understanding of Economic Systems Through SteemitsteemCreated with Sketch.

in #steemit4 years ago (edited)

Steemit v. The US Economic System: A Comparison

I'm always trying to better organize my ideas and beliefs with respect to Steem and Steemit, and what exactly they are, partially for my own understanding but equally as important for communicating "what steemit is" to people who aren't familiar with it. Below are images taken from an exercise I conducted on my whiteboard where I compared an imagined "Simple System" of distributing currency, to the US System, and to the Steem/Steemit System. This is kind of how I've been explaining Steemit to people as of late, so I wanted to explore it in a bit more detail. I definitely think that looking at these systems in this way is a good aid for talking about it to the uninitiated.

Educational Insight Into Existing Systems

This also highlights one of the undervalued uses of Steemit/Steem which is that it is a great way of gaining understanding over our current systems. Most people just accept our monetary system (and our political system) as "just the way things are." Whether people like Steemit or not, it at least provides a radically different counter-example which highlights the features of existing systems by presenting a radically different alternative.

If you have any ideas for improving these comparisons, please share in the comments below!

If you liked this post, you might like the other post I published today:

The People's Diet: The Ketogenic Diet


What I like to point out to people is that US dollars are created as debt, whereas steem dollars are created in response to work done. U.S. currency creation is made in the form of a loan. Steemit currency creation is actual wealth. Only Steemit's way actually exemplifies wealth "creation."

Steemit is actually creating wealth. Thanks for the informative post!

Too bad steemit is dead

In the US system column, you say that (paraphrasing here) banks determine which productive enterprises or individuals to contribute newly created currency to. That's definitely the stated goal of the system, but they can do whatever their profit-motive drives them to, which isn't necessarily curative.

For example, if the banks choose to inflate asset prices because they determine their risk exposure too great to instead contribute to actual investments, then they're free to do that (which is what I think is what's been happening over the last two economic cycles at least). There's no mandate (not that I advocate for that sort of thing, it's just how the US system is set up) incentivizing them to adhere to the system's intended goal.

Sorry, that's not very concise, but it's late and I'm not versed at condensing these things like you're so adept at with your whiteboard brainstorms ;).

Yes, good observation. I was intentionally being as generous as possible to show that EVEN IF you look at the most favorable view of the US system, it is still vastly different than the Steem-based system we use and, I would argue, inferior. It's this idea of arguing from a perspective of, "what happens if we accept all of your premises as true?" People have been criticizing the US system for decades from the perspective of, "Your system is corrupt!" to no avail because that changes the discussion to an argument about what is corruption and whether it does or does not exist. By accepting the premises (e.g. that banking sector uses experts to distribute funds based on productivity) you can move on to the question of whether logic or science backs up the claim that your system will achieve a desirable outcome.

Thanks for the very thoughtful comment! No need to apologize for the lack of concision, I'm the same way :)

Agreed. The Steemit system of incentives are set up in a way that's much closer to the stated goal of giving the most resources to the most productive. Value being subjective, that's not so easy for people to wrap their head around. I think it's been working surprisingly well so far, although many here would disagree.

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