The amount of wealth you can capture relative to your peers is currently unlimited. This is a problem [1].

Bounded capitalism attempts to address this problem.

Introduction

In this essay, "unbounded capitalism" refers to free-market capitalism that opposes government intervention in economic affairs.

Proponents of unbounded capitalism argue that government intervention adds unnecessary cost and complexity to economic systems. Our economy is made up of many rational agents playing by the rules of a social contract, but motivated primarily by self-interest. The collective decision-making of these self-interested agents will guide the economy's "invisible hand" towards outcomes that serve society's needs. Government intervention often discourages, prevents, or even punishes innovation. It's also incredibly expensive and wildly inefficient. The social responsibility of business is to increase profits for shareholders as efficiently as possible. Government intervention and its inefficiencies should be minimized.

Opponents of unbounded capitalism argue that the purpose of government intervention is to protect society in a democratic manner. Without intervention of some kind, both capital and power tend to become highly concentrated. Unbounded capitalism incentivizes private institutions to competitively weaponize public institutions in service of their private business agendas. The total set of options available to consumers is slowly eroded down into a small number of unsustainable, unfulfilling options. Monoculture rises, diversity falls, and our environment decays while fewer people make bigger decisions. Bounded capitalism reduces moral hazards by constraining root-causes of catastrophe. The social responsibility of business is to improve quality of life for all by innovating within rational constraints. Intervention can be used to ensure that sustainability is prioritized over velocity.

In this essay, I entertain the possibility that both perspectives contain truth, and that an elegant solution exists in the overlap between their truths.

I refer to this solution as bounded capitalism.

Ongoing catastrophes

identify known problems
stick with data and logic, epistemic humility, steel-manning
build upon factfulness thinking, don't shit on it, don't editorialize

Root causes

Analyze the motivations underlying the institutions and the people
maybe bring in scopes of concern, fluid rationality

Individuals and institutions

images of organization
metaphors and 3b1b strategy of considering invariants, windmill problem, reducing the complexity as a thought exercise
difference between institutions and people, abstraction as obfuscation of responsibility, "moral heatsink", rigidity, cost of evolution, incentives, authority, power, psychology of power

Tribes and communities

exclusive vs inclusive
extrinsic vs intrinsic

What is bounded capitalism?

Like unbounded capitalism, bounded capitalism incentivizes people to innovate and compete. Participants are rewarded for the value that they create. If you create something that people are willing to pay for, you'll make money, and your quality of life will improve.

With unbounded capitalism, there is no upper limit to the amount of wealth you and your institutions can capture. But with bounded capitalism, the degree to which you and your institutions can accumulate wealth is bounded by the earnings of the weakest wallet. The ratio between the richest and poorest is limited with code.

For example: after you've earned your first $10M, you can't earn more unless everyone else has earned at least $10K. You can still compete and win, but all players eventually have to compete to build systems that pull everyone up together.

Within a bounded capitalism economy, wealth isn't the number of coins in your wallet. It's your history of doing things that improve others' lives.

Public goods and private kings

Public goods generally live on a spectrum from "this thing serves the interests of one person" to "this thing serves the interests of society". Bounded capitalism installs a sort of "gravity" into the economic system that incentivizes public goods over private ones.

Within a bounded capitalism economy, Bezos could still build Amazon; Gates could still build Microsoft; Jobs could still build Apple; Zuck could still build Facebook; Musk could still build Tesla.

But at a certain point, the wealth captured by their creations would automatically be siphoned away from private treasuries and towards public goods that raise the bar for everyone. Their creations would still enjoy massive capital throughput and rapid growth, but they'd be throttled a little so that a lot of people could enjoy a way better life.

This isn't what we have now. Today's companies are fine-tuned financial machines that accept inputs and generate outputs in a way that prioritizes the machines and their shareholders. These machines are incentivized to competitively destroy boundaries.

From the perspective of an unbounded capitalism machine, boundaries are opportunities to be exploited.

One problem with the design of these boundary-busting financial machines is that they revolve around their founders. The machines give their creators economic power, and then cultural power, and then political power. Technology games evolve into economy games, which evolve into culture games, which evolve into political games.

These games are machines of their own that accept inputs and generate outputs in a way that is self-reinforcing. Sometimes, these games give us techno-kings who wield more power than Genghis Khan could have ever imagined.

We're then forced to have faith in the good intentions of techno-kings who sit comfortably in their culture-thrones, techno-worlds in orbit around them. These kings tend to brand themselves as benevolent, and they may aspire to benevolence. But these are mere men. And these men are usually neurodivergent gamers who have become fixated on their own games. Their fixation has given them capital allocation superpowers, but also social blind spots.

Another problem with the design of these financial machines is that they treat consumers like fodder. These machines will pay the world's smartest people to figure out how to exploit human fodder more efficiently than competitors. Decades are sacrificed in the name of long-tail micro-optimizations, placing the determinants of private legacy on a microscopic battlefield, where legions of engineers pour their lives into decimal-point victories.

Another problem with the design of these financial machines is that innovation is choked. Corporations are incentivized to catch-and-kill competitors. If a competitor resists being snuffed, battalions of corporate lawyers are deployed to drown the new entrant in attrition warfare.

There are many more problems with the design of today's financial machines. But these three problems demonstrate an interesting behavioral pattern that's worth focusing on: our current financial machines are economic vampires.

They use the psychology of heroism and hope to seduce society under the guise of techno-utopianism while they suck capital out of the economy as quickly as possible. They invest back into society only when the cost of not investing exceeds the cost of investing. To them, altruism is a regrettable PR tax. These cold, calculating, vampiric machines don't have intelligent designs. They aren't self-aware. Their DNA is crude and simple. They just want to grow.

Gardeners and vampires

Vampires and gardeners both care about growth. But the gardener's priorities are different.

While the vampire "moves fast and breaks things", a gardener moves slow and fixes things. The gardener prioritizes diversity, sustainability, and balance. To the gardener, anything that prevents new forms of life from emerging and thriving is a threat to be managed.

There's no doubt that vampiric financial machinery generates innovative technologies. Many of these technologies pull humanity forward in many ways. Computers, web apps, smart phones, EVs, and vaccines were each created within a relatively unbounded economic architecture.

And these technologies are morally ambivalent. They just exist. We, along with the systems we create, determine the morality of these technologies through the way that we use them.

Both vampires and gardeners create lifeforms for a purpose. The vampire's purpose is to grow. The gardener's purpose is to cultivate sustainable growth and diversity of life. These different motivations incentivize different forms of innovation, and different ways of using technology. There's a sharp contrast between the vampire's creations, and the gardener's. There's an equally sharp contrast between the way that vampire uses technology, and the way that the gardener uses technology.

The gardener's creation isn't recklessly ambitious. It grows only as much as the surrounding environment can grow along with it. The gardener's world grows slowly, but together. Vampires give us sharp concrete spikes that tower over society. The vampire's world grows with more turbulence and concentration.

The gardener's creation optimizes not for self-contained profit, but for ecosystem cash flow. The gardener builds systems that route capital to a diversity of needs-oriented initiatives.

Gardeners are to vampires as bounded capitalism is to unbounded capitalism. Both forms can be "hands off", but their respective invisible hands demonstrate wildly different personality traits and forms of intelligence.

Vampirical artificial intelligence

Unbounded capitalism is a vampiric form of artificial, institutional intelligence that animates vulnerable techno-kings into leaderboard ambitions. The most promising king-candidates are selected and groomed by the machines.

As our machines breed kings, life improves for some, in some dimensions. But life gets worse for many, in many dimensions.

Cherry-picked silver linings can be arranged into New York Times bestsellers like Factfulness, and the kings will endorse them. But lurking beneath their shirking sludge lies a constellation of sinister symptoms. Our world has cancer, and the root cause is an ideological disease that has become a religion for many.

A lot of people used to believe that the Earth was the center of the universe and that the Sun and planets revolved around it. We eventually figured out that the sun was the center of the solar system and that our world revolves around the sun.

Is it possible that our survival as a species depends on a similar reframing? Maybe technology should revolve around human needs instead of founders and shareholders. Maybe human needs should be the source of gravity that dictates how techno-worlds form and evolve.

Our prevailing economic zeitgeist has normalized the economic vampire / creator deity archetype. Myopic private visions are fueled with capital extracted from competing initiatives, many of which are public goods.

What if we started with human needs, and worked backwards into technologies that meets those needs at scale? Could we build a game that satisfies the techno-king's leaderboard ambitions without accidentally giving him the keys to the kingdom? Could we give him games that generate technologies that help everyone, here, now?

Comparing the current state of reality with our desired state makes it easy to argue that unbounded capitalism, as an intelligence, isn't very intelligent.

Bounded capitalism could give our institutions the constraints they need to thrive intelligently.

Starting with utopia

Reducing America's reliance on fossil fuels will accelerate our transition to energy independence, but energy independence is a small means to a larger end. What are we here for?

Ultimately, we want to build a future where human needs are sustainably satisfied. And the root universal need is sustainability. Sustainable energy is useless without sustainable economics motivating it.

Steve Jobs once advised his audience to "start with the customer experience and work backwards to the technology." The same principle could be applied to the world of mechanism design. We can start with utopia and work backwards to the incentive structures that yield it.

One possible version of utopia is a world in which everyone's needs are increasingly satisfied over time. In this world, your life would improve as you get older. You would envy your children. You would experience continuous and tangible improvements to your user experience. More and more people would be thriving over time.

You might enjoy this reality now, but most don't.

Normalized, universal thriving is what a gardener economy would feel like. In a gardener economy, you wouldn't be at the mercy of techno-king paternalism. You'd be just riding the gentle wave of life as it grows cautiously into the decentralized, laminar future.

How can we build a gardener economy? How can we ensure that as innovations grip markets, human needs are increasingly satisfied for everyone on net, in a sustainable manner?

Bounded capitalism is an attempt to answer this question.

Hardcoding the wealth gap

With bounded capitalism, the degree to which you can accumulate wealth is bounded by the earnings of the weakest wallet. The ratio between the richest and poorest is limited with code.

As a techno-king, you'd play your games, business as usual. You'd build cool things that people want. You'd get rich. Richer than most. But there might be hundreds or thousands of other techno-kings earning exactly as much as you. And nobody would be earning more. After achieving some level of success, the currency that your machine earns would be automatically redirected to public goods. Your private enterprise would slowly permeate the market towards utility status. You wouldn't be incentivized to outfox other kings. Instead, you'd be incentivized to collaborate with them.

As a consumer, your choices would become much more diverse and delightful. You wouldn't be forced to tolerate Comcast while hoping for Starlink. You'd have a diversity of good options. Solution diversity would be a parameter that the system incentivizes through capital programming that pipes money away from monopolies and towards underdogs.

Similar to the way that client diversity is critical to the security of Ethereum, solution diversity will be critical to the security of human society.

Such a mechanism design could remove the need for taxes, UBI or even antitrust. The purpose of those primitives is to protect people from catastrophe. But maybe a holistic protocol upgrade targeted at the root cause can prevent catastrophe without requiring ongoing feature work or symptomatic treatment.

Grassroots scientific utopianism

The concentration of capital within rigid hierarchies prevents us from solving problems that require capital and coordination. We need a more agile way of being, a fluid and responsive way of deploying capital to initiatives that help us rapidly adapt to our environment.

The "misallocation of resources" problem can be reduced down into the socioeconomic distance between richest and poorest, institution-inclusive.

As this distance increases, the power to solve problems becomes increasingly decoupled from those experiencing the problems. As the distance decreases, the power to solve problems becomes firmly embedded within those experiencing the problems.

The distance is too large right now. Things like UBI and corporate tax policy can pinch that gap down over time, incrementally, against the wishes of the billionaire class and its pet politicians. But we now have the tools to hardcode the gap. So... we should.

This is the entire point of product development philosophies that value "getting closer to your customer". We can't expect customers to design their own solutions, and engineering by committee doesn't usually work very well. We can't expect individual citizens to design their own society.

But we can normalize an abundance of high-quality options.

The most powerful people are unlikely to opt in to a system like this because it's a form of antitrust that takes power away from incumbent monopolists, and the pain of losing power is felt more than the pleasure of gaining it.

So we'll have to opt in ourselves. We'll have to travel to the root of evil [2] and quietly plant the seeds of utopia while war-as-usual carries on around us.

We can show people what it feels like to live on a digital island that implements bounded capitalism. We can then measure the effect of this mechanism design on a group's culture, philosophy, psychology, and overall well-being, iterating towards universal need-satisfaction together.

I'm hypothesizing that hardcoded bounds will have a positive impact on our collective well-being because it shifts the power of capital allocation to the majority. It expands the scope of our democracy beyond the political makeup layer of society and into the core of our economic machine.

If we think of our economy as being a sort of brain, wealth concentration is like Alzheimer's. It concentrates processing power into a small minority of brain cells. Unbounded capitalism is a bottleneck on our collective intelligence.

Bounded capitalism distributes processing power across a wider variety of processor types so that we have sufficient diversity of thought to adapt to externalities - such as climate change, pandemics, geopolitical challenges, or extinction events.

We can test this hypothesis at a small scale (eg within Karma or some other digital experiment), and then scale up and out across more digital islands.

Imagine how your reality would feel in a world where adtech solutions like Facebook and Google are incentivized to figure out not just how to deliver advertising for profit, but how to deliver advertising that connects consumers to products that improve everyone's life. Healthy, unifying, educational advertising could replace the toxic and divisive corporate propaganda we're faced with today.

Bounded capitalism tugs us away from shareholder primacy and towards a primacy of universal thriving.

A path to pragmatic utopia

At a macro level, the order of operations is:

build web2 [done, ugh]
build web3 [we are here]
implement bounded capitalism
sustainable economics
pragmatic utopia

Karma as a sandbox

Karma is an attempt to test (3). It's early days, but the idea is simple:

achieve PMF on karma [we are here]
create a bounded capitalism token for karma. the token has autopilot. tokens automatically move out of wallets where wealth is overly concentrated.
experiment until it feels right to everyone
grind away on decentralized knowledge-building, dream-building, future-building
attract web2 business users who pay for Karma's knowledge management tech
reinvest web2 capital inflows into bizdev and other web3 projects that also implement bounded capitalism
??? (zk-pop - zero-knowledge proof-of-personhood - "I am a trusted human, but I'm not telling you who I am" - should facilitate a new class of wallets that implement bounded capitalism for a variety of currencies)
sustainable economics

Rationalizing cryptocurrencies

Critics of "web3" often lament that we're just digitizing fiat's problems. "Crypto-bros and buzzwords galore! Crypto doesn't do anything to mitigate wealth inequality - it exacerbates it!"

It's true. The technologies don't solve problems. They introduce new problems.

But they also give us the ability to solve old problems. They give society new features, like blurry backgrounds on video calls. This is what technology does. It moves. It evolves. Faster and faster it goes, leaving us exactly where we've always been: a wretched state of suffering.

“My dear, here we must run as fast as we can, just to stay in place. And if you wish to go anywhere you must run twice as fast as that.” - Lewis Carrol, Alice in Wonderland

But as technology drags the Overton Window forward, it raises the class of our wretched suffering up away from basic need-satisfaction, and towards a suffering for self-actualization. Suffering for your identity seems like more fun than suffering for food, rent, healthcare, or education.

It's up to us to intelligently design the suffering we want to endure, and then design the technologies that help us realize those designs. Cryptocurrencies give us the tools we need to realize a higher class of suffering. Bounded capitalism is a theory that uses this technology as a means to that end.

todo: power flows down the path of least resistance - we can install guardrails

Reductionist pathfinding

This content is incomplete. Add a comment below or issue a pull request to contribute.

Imagine we're on an island with:

3 nations
5000 people
100 businesses

Orient this island such that the capital architecture and mechanism designs approximate those of today. Illustrate how techno-kings are born, and how they determine the reality of the island. Tell the vampire-system story. Analyze the behavior of the invisible hand.

Then tell the gardener-system story. Imagine improved invisible hand behavior. Work backwards to mechanism designs that yield the desired behavioral change.

Then introduce crypto, demonstrate step by step how people crawl-walk-run from unbounded capitalism dystopia to bounded capitalism pragmatic utopia. Poke holes every step along the way - wargame the shit out of it. Major steps first, then minor steps, until we arrive at a strategy. Then draw the rest of the fucking owl.

eg when you create a business, you have to convince ten random people that it's worth funding, and there's a smart contract that does this for you, ensuring that trustworthy verified individuals are selected to assess. you can only try so often, and/or you need to pay to try, and the assessors get paid for their assessing.

then bam, you get a business bank account on the blockchain. And the system starts routing capital from the whales into your little account. A fixed amount, every month. Then the game you play is figuring out how to best utilize that capital in service of unmet human needs. You win more as more people are lifted out of poverty, or pain, or prejudice. You have to build systems that capture the love of the disenfranchised. And you do it invisibly. And the system gives you more money as you capture more love. But as you begin to capture lots of love, your earnings growth stagnates, and goes to 0. And this is fine. You just keep doing what you're doing, put it on autopilot, and then move on to the next thing while the old thing slowly evolves. This old thing is a true DAO - a decentralized, autonomous organization that's loosely coupled to society through hypersimple governance protocols. GPT-4 writes code that steers the DAO towards need-satisfaction, in collaboration with other GPT-4 DAO-agents. DAOs listen to users and evolve for them, with minimal human oversight. Users enjoy a good life by default. Creators launch DAOs that compete with other DAOs - but only so much. Diversity of solutions is guaranteed. Proof of brains is used to assign SMEs to decisions as difficult decisions need to be made. These SMEs are tasked with producing educational pre-reading with voters, that voters ultimately digest before voting. voters get paid to vote. then they buy their favorite shit. People still experience trials, tribulations, sadness, loss, and struggle. This doesn't take away from what it means to be human. It just unlocks a while new bandwidth of productivity by giving everyone in the world a really comfortable min-bar. So what if Shinra Corp doesn't grow as fast? There will be an abundance of people who want to service their mission. Or at least their more inspiring competitor will. The competitive landscape moves away from a world dominated by single-serving corporations, and towards a world dominated by infinite dreams. this is the world of intrinsic motivation and semantic engineering. Most people are doing exactly what they want to do, exactly the way they want to do it, with exactly the people they want to do it with. Options are abundant, and forgiveness is baked into the system. The system never gives up on you. Those with extreme needs will be supported, and nobody will be abandoned. If you want, the system will try to map your attributes and strengths into opportunities that will value you. You can then build upon those strengths in an environment that gives you belongingness and esteem. And then you can branch out from a position of strength. And all throughout this journey, you expose only what you want to expose. There are no social credits. Paths to authoritarianism are continuously explored and blocked.

The Vampire Loop

make money
buy political power
buy cultural power
define norms
cultural hegemony is a source of psychological gravity
as people are pulled away from their identity and towards this source of gravity, anxiety, depression, dissonance get worse
they comply to survive
compliance fuels concentration
more deregulation
more concentration
more distance between actual identity and imposed identity
less happiness

The Gardener Loop

uses currency to imagine a new world where gravity is more distributed
more diversity
less fame / celebrity, these phenomena become decentralized, richness of culture emerge, capital from entertainment infrastructure gets distributed
instead of spikes of toxic celebrity, a rolling savannah of creation
less monoculture pulling people away from their identity
more hyperculture giving people an infinite garden to explore
every human has a distance between actual identity and imposed identity
identities are like nodes, cultural norms are like meganodes, distance between identity nodes and culture nodes should be minimized by giving a diversity of culture nodes instead of one consolidated monoculture
new currency gives us a way to define parameters of culture and norms and diversity, can help us manage psychology instead of exposing it to exploitation
relates to ken robinson, ideal flow through education, institutions extracting freedom from infrastructure

Steel manning

How do you deal with free riders?

I'm of the opinion that if you can't motivate someone [3] to do something with intrinsic motivation alone, the thing is worth automating away or eliminating entirely.

We should get to a point where you and everyone else can wake up and do whatever the fuck you want. You should be able to just chill out and rest without worrying about productivity. Universal basic human needs motivate us to provide society-scope value - we don't need extrinsic motivation to drive this.

You have a need for respect, appreciation, esteem, creation, self-actualization. You should be able to just casually experiment with identity-project fit until you find something that works really well for everyone. You shouldn't have to sacrifice this wayfinding with "labor" that earns you food and shelter.

If it's possible to build a world where nobody has to labor for food, shelter, education, or healthcare, then we should build that world. These things are human needs, and therefore rights. We have a moral obligation to believe in the possibility of building a world in which everyone's needs are satisfied.

In a world where the min-bar is not merely survival but thriving, a new type of game becomes normalized. These new games pull everyone up (even non-players).

The primary difference between tomorrow's games and today's games is that you'll wake up genuinely excited to play tomorrow's games because they give you autonomy, mastery, purpose, and other need-satisfactions.

Tomorrow's games won't coerce you to choose between a limited number of poor user experiences.

A large number of wonderful user experiences will let us test purchasing preferences in an environment where people aren't being overly coerced or constrained. The systematic monopolization of of our economy and commodification of our lives have given us a low number of low-quality choices. So we don't have good data. We just have Alzheimer's.

To get to a world that gives us a high number of high quality choices, we need to normalize abundance of "basic shit" resources. Table stakes should include everything we need to make high-quality long-term decisions [4].

You shouldn't have to spend your hours trying to survive, worrying about your food and lodging and future. You should be able to focus on your health, your friends and family, community, society, dreams, what it means to self-actualize, and what a better, more just world might feel like.

In summary, I'm not sure if free riders are such a bad thing. A free rider is just someone who hasn't yet discovered who they are, and who they can become. It's on us to build games that accelerate that process for everyone.

Isn't this techno-utopianism?

This term has a negative connotation but I'm not sure exactly what it means or why it's a bad thing. I believe that technology can be a great equalizing force and that we have a moral obligation to develop technologies designed specifically to make the world a better place for everyone as efficiently as possible. Technology isn't meant to be perfect or moral, but we can always improve the way that we use technology to deliver the future. This is a proposed improvement.

Isn't this just UBI?

Functionally, yeah. This isn't really a new idea. Social security, corporate taxation, UBI, and other forms of government-facilitated welfare are all exercises in Bounded Capitalism. But they're complicated, expensive, bureaucratic, inefficient, often ineffective, often counterproductive, and they're often used as bargaining chips in political games.

Bounded Capitalism cuts the fat and gets straight to the point. It achieves the desired outcome through reduced costs and complexity.

It "taxes the rich" and "cuts checks to the poor". But it skips over banks and governments, and instead uses a piece of code that automatically moves money around without any politicking or bureaucracy.

Just... boop. To each according to their needs from each according to their means. It'll probably be like, 10 lines of code assuming everyone is open to proof-of-personhood [5] and custodial wallets [6].

Why would anyone play a game where your winning is capped?

Games that implement Bounded Capitalism will attract players who believe in equality of opportunity. Getting a bunch of those people together and letting them play might lead to some beautiful outcomes.

"Wealth that causes poverty isn’t wealth." - Robert Reich

This doesn't stop people from being selfish.

True - capitalists could still build machines that exploit workers in a bounded-capitalism economy. But the concentration of wealth within these machines would be capped, and excess would be injected directly into the wallets that need it most.

The capitalist would only be able to earn more after the lowest members of society have earned more. This could incentivize him to think about how he can help the poorest members of society actively engage with the economy. Instead of "how do I collect coins", the system incentivizes him to ask, "how do I build games that help people, that people want to play".

This may slow progress, but is that such a bad thing if we're going fast in the wrong direction? Bounded Capitalism trades high speed for improved direction.

What about unrealized capital gains?

It seems strange that the least tax-efficient way to make money is to work for an employer. Should working for an employer be the most tax-efficient way to make money? If so, how do we fix that in relation to unrealized cap gains? What has been tried here?

If you bought 1000 BTC in 2017, you'd be sitting on something like $50M. Should the system automatically realize a portion of those gains after a certain threshhold? What would that even look like?

Will we need to worry about it if we just amputate fiat currencies from our economy?

If we can't amputate fiat, how would might auto-liquidations impact incentives? Price discovery? Would this curb speculation? Should we curb speculation? What impact would auto-liquidation have on our economy, innovation, culture, sustainability, etc? Should it be possible for someone to earn $0 through salary / bonus / realized gains (paying nothing back to society through taxation) while accumulating trillions through unrealized gains? If not, what mechanisms can we use to bound that type of wealth concentration? Any interesting case studies to learn from?

What if all investments are forced to close on an annual basis, gains and losses are clocked, taxes applied using rules of bounded capitalism (ratio between highest earnings : lowest earnings is limited automatically... recklessness is immutably public and impacts things like credit scores / access to credit/lending to disincentivize destructive institutional freeloading)?

Then you're free to reinvest into the most promising assets after your positions close. This would incentivize short-term speculation though...

What if when you invest, you're forced to hold for at least a year? Or three years? Maybe max = 10 years, and you get penalized progressively with increased tax on short term speculation? So society benefits from forced liquidations every ten years, and those liquidations have the most favorable tax benefits, anything before 10 years is taxed more, and working for an employer is taxed the least, and next to no tax if you're working min wage?

What if we just skip over this conversation and design an L2 solution that implements ownership models that render it obsolete? If we eliminate the concept of capital gains then we don't have to talk about it. Maybe that would be easier.

So you'd slow Tesla down?

Within a gardener economy, Tesla wouldn't yet be impacted. Musk might be.

Tesla's finances wouldn't be impacted until it hit some democratically parameterized upper limit of market share. Once it's hit that limit, people who purchase Teslas would be directly funding some startup's initiative. Or a competitor's initiative. Or another market entirely, depending on society's state and needs at that particular time.

This way, every market looks like a pizza with _minSliceCount, where some slices are _maxSliceSize.

Musk's personal wealth would probably be mostly redistributed to affordable housing innovation, nuclear energy research, education infrastructure, policy that accelerates our transition to a sustainable economic theory, and other things determined by a continuously evolving political platform that reflects everyone's needs.

How would this relate to automation?

One popular argument against automation is that "it takes jobs away". In a bounded environment, that's fine, because whatever money the robots make will be auto-distributed to humans based on their contributions to the machines that help humans, but nobody will be left behind.

Humans who make lovable robots will be rewarded more than humans who don't. But humans who don't will still enjoy a 10x lifestyle. The 100x lifestyle is for the innovators, and nobody is allowed to have a 1000x lifestyle because there's virtually no benefit from going from 100x to 1000x, but there's a massive social cost over a long enough time-horizon.

We could even rotate the 100x lifestyles around so everyone gets a taste of it, using a bit of fun extrinsic motivation to seduce people towards collaboration that results in shared prosperity in a non-coercive manner.

Ideas are a dime a dozen, what are you doing about it?

I'm trying to build products that implement Bounded Capitalism. Karma is one (you're on karma now). PMAlerts is another. The first step is to try to build something that people love. Achieve PMF first, earn my stripes, then progressively decentralize towards a mechanism design that implements bounded capitalism. Prove it works. Then bizdev the ideology.

If we can nail the mechanism design within the product scope, we might be able to then abstract the rules into an open-source protocol that other initiatives can implement.

Won't unbounded competitors outcompete bounded competitors?

I believe that eventually, Bounded Capitalism will become a competitive advantage for products of all kinds.

Personal responsibility compels some people to manage their carbon footprint and recycle even though it's inconvenient. The aim of Bounded Capitalism is to present to consumers a similar choice between unsustainable products and sustainable products. Ideally, every widget produced by the Unbounded machinery will have a corresponding widget produced by Bounded machinery.

Because the incentives between users and builders will be more aligned within Bounded machinery, there's a strong possibility that Bounded widgets feel sexier, more fun, and easier to use than Unbounded alternatives that have to allocate design space to proprietary fixations.

People could begin playing games that are meant to "improve the world for all" - games with clear and simple upper bounds on accumulation. Trustless implementations of Bounded Capitalism should become easy to experiment against (as builders) and to trust-but-verify (as users).

It wouldn't be difficult for Axie Infinity to implement it, for example. It's just another tokenomics feature.

See also:

Ideas to synthesize:

Deposited into note
Distributed to author
Trickled down to conversation	$0
Available to trickle down
Patrons	1
@mick

Token	Address	Deposited	Distributed	Trickled	Balance
Ethereum			TBD	TBD	TBD
Solana	TBD	$0	TBD	TBD	TBD
Cardano	TBD	$0	TBD	TBD	TBD
Bitcoin			TBD	TBD	TBD
Dogecoin			TBD	TBD	TBD
Total			TBD	TBD	TBD