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fandomhigh2011-02-03 11:45 am
glasses-justice.livejournal.com) wrote in fandomhigh2011-02-03 11:45 am
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Nation Building and the Origin of Government, Period 5, Class 5, Thursday, 2-3
"Good to see you're all surviving the storm," Alex said, greeting her students with a quick smile before leaning against her desk. "These past few weeks, we've been in what you might call crisis mode with our new country. We've been trying to keep the peace, and protect against threats both external and internal. Those first four weeks could be loosely grouped under the heading 'Authority' - meaning ours, how we worked on enforcing it, and how we distributed it.
"Now that we have a bit more stability, we're going to move on to some topics that have to do with the way resources are moved from one place to another. How our citizens obtain those goods and services they need in order to survive. In other words, we're going to be talking about money."
Money was, of course, one of the things that made the world go round. They had to get there sooner or later.
"How exactly do we want to tackle money, for this country of ours? We have a number of possibilities. Some societies operate on the barter system -- people trade directly, one-to-one, with what they have for what they want. I have a cow, you have a chicken; you give me eggs, and I give you milk. It's very clean, and transparent, but as you can imagine, it gets complicated quickly. What happens if I need a doctor, but he doesn't want any milk? What happens if you find someone who's willing to give you milk for fewer eggs? This is typically where a third party steps in, to form some kind of a barter exchange. This can also help with matters of convenience; it's not going to always be desirable to lug a basket of eggs around when you need to go shopping.
"This is typically when money comes into existence. Money functions as a medium of exchange. It has a fixed value, although obviously that value can and does shift over time, and that means good, as well, can be fixed. I give you money, for your eggs, and you can use that to purchase milk, or a visit to the doctor, or whatever you would like. It formalizes the third party and simplifies matters."
In as much as money could ever be said to simplify anything, but that was a philosophical matter for another day.
"So," Alex continued. "What do we use for money? Most societies on earth use bills and coins, or, now that technology is advancing, we have plastic cards that can access our bank accounts, so the money never needs to be tangible. We need something light and portable, and easily identifiable. We also need something that isn't easy to replicate, or we'll have counterfeiters flooding the system with worthless copies. It would be nice if these items weren't expensive to make, since the overhead is going directly to us, the government. In the case of computer systems of credits, we'll need a way to ensure the system can't be hacked.
"Of course, another possibility is that we're going to be running a communist regime, giving to each what they need and asking from each what they can contribute. It's a perfectly legitimate answer. Plenty of communist societies suffer from corruption and graft, but that's human error. Some say that there's no incentive for anyone to work harder than anyone else. But on the other hand, everyone is taken care of. And even then, we may wish to have a monetary system in place, in lieu of vouchers which mimic the barter exchange. The avenues aren't mutually exclusive."
Alex smiled at her students. "In the coming weeks, we'll talk more about businesses and the corporate culture, about tax and social programs, all the things that come with working out the logistical kinks of our financial side. But for this week, we're just going to focus on money."
"Now that we have a bit more stability, we're going to move on to some topics that have to do with the way resources are moved from one place to another. How our citizens obtain those goods and services they need in order to survive. In other words, we're going to be talking about money."
Money was, of course, one of the things that made the world go round. They had to get there sooner or later.
"How exactly do we want to tackle money, for this country of ours? We have a number of possibilities. Some societies operate on the barter system -- people trade directly, one-to-one, with what they have for what they want. I have a cow, you have a chicken; you give me eggs, and I give you milk. It's very clean, and transparent, but as you can imagine, it gets complicated quickly. What happens if I need a doctor, but he doesn't want any milk? What happens if you find someone who's willing to give you milk for fewer eggs? This is typically where a third party steps in, to form some kind of a barter exchange. This can also help with matters of convenience; it's not going to always be desirable to lug a basket of eggs around when you need to go shopping.
"This is typically when money comes into existence. Money functions as a medium of exchange. It has a fixed value, although obviously that value can and does shift over time, and that means good, as well, can be fixed. I give you money, for your eggs, and you can use that to purchase milk, or a visit to the doctor, or whatever you would like. It formalizes the third party and simplifies matters."
In as much as money could ever be said to simplify anything, but that was a philosophical matter for another day.
"So," Alex continued. "What do we use for money? Most societies on earth use bills and coins, or, now that technology is advancing, we have plastic cards that can access our bank accounts, so the money never needs to be tangible. We need something light and portable, and easily identifiable. We also need something that isn't easy to replicate, or we'll have counterfeiters flooding the system with worthless copies. It would be nice if these items weren't expensive to make, since the overhead is going directly to us, the government. In the case of computer systems of credits, we'll need a way to ensure the system can't be hacked.
"Of course, another possibility is that we're going to be running a communist regime, giving to each what they need and asking from each what they can contribute. It's a perfectly legitimate answer. Plenty of communist societies suffer from corruption and graft, but that's human error. Some say that there's no incentive for anyone to work harder than anyone else. But on the other hand, everyone is taken care of. And even then, we may wish to have a monetary system in place, in lieu of vouchers which mimic the barter exchange. The avenues aren't mutually exclusive."
Alex smiled at her students. "In the coming weeks, we'll talk more about businesses and the corporate culture, about tax and social programs, all the things that come with working out the logistical kinks of our financial side. But for this week, we're just going to focus on money."
Re: Discussion #1 - How Money Works In Our Society - NAT05
Re: Discussion #1 - How Money Works In Our Society - NAT05