Decoupling Energy Consumption from Living Standards
Cranio-rectally impacted politician Charles Grassley was recently quoted as saying:
Grassley is just one of many idiots who see the American "national interest" as requiring government action to secure "safe, reliable, and abundant" energy supplies for the economy.
Didn't conservatives use to condemn "feelings of entitlement" to get stuff without, you know, paying for it?
At the other end of the spectrum, people like George Monbiot work on the assumptions that 1) reduced energy consumption will mean reduced living standards; and 2) reduced energy consumption must be imposed by the state. Both sides ignore the possibility that there are more and less energy-intensive ways of producing the same consumption goods, and that the market price of energy might affect which is chosen.
At Catallarchy, Randall McElroy posts an excellent quote from Bjorn Lomborg's The Skeptical Environmentalist that calls these mirror-image assumptions into question:
Of course, I've expressed more than a little skepticism about how valid a measure GDP is of living standards. But I seriously doubt that the real standard of living has been hurt by Denmark's reduced energy consumption.
In any case, as I've argued before, the one thing needful to encourage energy conservation is for all the costs of energy production to be internalized by the consumer. Artificially cheap inputs are consumed in excessive amounts, because the distorted price signal gives the consumer inaccurate data about the real cost of producing what he consumes. High energy prices that fully reflect all the costs of providing energy will lead to less energy-intensive forms of production.
Right now, in the American economy, subsidized consumption of energy and transportation factors means that it's artificially cheap to buy stuff produced by a big factory at the other end of the country (or in China), rather than by a small factory in the county where you live. And subsidies to sprawl mean that for each of us, there are two separate cities--a daytime city where we work and shop, and a nighttime city where we sleep--each with its own electrical power system, and with expensive freeways running between them. Simply eliminating such massive, subsidized waste would likely reduce energy consumption to a fraction of what it currently is. And that's not even counting all sorts of other stuff, like passive solar building design, or on-site processing of farm waste into biomass fuel at the point of consumption.
energy
You know, what--what makes our economy grow is energy. And, and Americans are used to going to the gas tank, and when they put that hose in their, uh, tank, and when I do it, I wanna get gas out of it. And when I turn the light switch on, I want the lights to go on, and I don't want somebody to tell me I gotta change my way of living to satisfy them. Because this is America, and this is something we've worked our way into, and the American people are entitled to it, and if we're going improve our standard of living, you have to consume more energy.
Grassley is just one of many idiots who see the American "national interest" as requiring government action to secure "safe, reliable, and abundant" energy supplies for the economy.
Didn't conservatives use to condemn "feelings of entitlement" to get stuff without, you know, paying for it?
At the other end of the spectrum, people like George Monbiot work on the assumptions that 1) reduced energy consumption will mean reduced living standards; and 2) reduced energy consumption must be imposed by the state. Both sides ignore the possibility that there are more and less energy-intensive ways of producing the same consumption goods, and that the market price of energy might affect which is chosen.
At Catallarchy, Randall McElroy posts an excellent quote from Bjorn Lomborg's The Skeptical Environmentalist that calls these mirror-image assumptions into question:
… Over the same period Denmark actually went even further and “delinked” the connection between a higher GDP and higher energy consumption: in total Denmark used less energy in 1989 than in 1970 despite the DGP [sic] growing by 48 percent during that time.
Of course, I've expressed more than a little skepticism about how valid a measure GDP is of living standards. But I seriously doubt that the real standard of living has been hurt by Denmark's reduced energy consumption.
In any case, as I've argued before, the one thing needful to encourage energy conservation is for all the costs of energy production to be internalized by the consumer. Artificially cheap inputs are consumed in excessive amounts, because the distorted price signal gives the consumer inaccurate data about the real cost of producing what he consumes. High energy prices that fully reflect all the costs of providing energy will lead to less energy-intensive forms of production.
Right now, in the American economy, subsidized consumption of energy and transportation factors means that it's artificially cheap to buy stuff produced by a big factory at the other end of the country (or in China), rather than by a small factory in the county where you live. And subsidies to sprawl mean that for each of us, there are two separate cities--a daytime city where we work and shop, and a nighttime city where we sleep--each with its own electrical power system, and with expensive freeways running between them. Simply eliminating such massive, subsidized waste would likely reduce energy consumption to a fraction of what it currently is. And that's not even counting all sorts of other stuff, like passive solar building design, or on-site processing of farm waste into biomass fuel at the point of consumption.
energy
posted by Kevin Carson | 7:02 AM
12 Comments:
Kevin,
Heaven forbid these people complaining would have to relyon their own ingenuity for energy. If they keep counting on government, they'll get what they deserve in the end. I just don't want to go down with them. I met a guy yesterday who tapped natural gas beneath his yard and doesn't pay a cent for fuel. Many of my neighbors use solar water and solar electric systems. There are plenty of alternatives that don't require gov't funding, legislation, handouts, etc..
Don't know if you celebrate or not, but I'm just swinging by to wish you and our fellow liberty minded bloggers and readers a Happy Thanksgiving.
Keep up the good work!
Thanks, rebellion! And happy Thanksgiving to you, too.
Re what you said about the people who consider it "too much trouble" to save energy, it reminds me of my experience with curbside recycling programs around here.
In one town, Lowell, the city provided a free recyclables basket for curbside pickup, and offered a trash program where instead of paying a monthly rate, you just bought the bags at a dollar each. I jumped on the chance: after I separated out recyclables and composted kitchen scraps, the bags only cost me (at most) a couple $$ a month.
In another town, Fayetteville, the city actually provided a years supply 104 purple bags (or 156, or something like that) for free, and only started charging for them after that.
But the local papers were full of whiny letters to the editor about how "unfair" it was to get "only" two or three bags a week, and then actually have to pay based on how much trash you generated.
I started noticing the places with the largest number of purple bags. In almost every case, they were filled barely half full and very loosely packed. And almost never anything in the recyclable basket.
In other words, they were too friggin lazy to do something as simple as stack their newspapers in the basket when they got done with them, and then pile empty bottles and cans on top. It sure caused SOMEBODY work to haul the bags off, though; I guess they thought the trash fairy paid the cost of cleaning up after them.
Kevin,
I had just told my wife that I would take the day off and play games all day instead of reading and writing. I couldn’t resist checking your site to see if my latest efforts generated some flow of dialog. You know how it goes; one post (one unit of dialog) inspires a comment (another unit of dialog) and the flow of dialog happens. If no one posts, then, no dialog; I can’t help but assume that you value dialog too.
Well…we are talking about currency. Current transactions of ideas; observations, concerns, past mistakes, present fears, past successes, present victories, and future possible realities - current events leading to future events; time being let out of the bottle; dynamic stuff, happening, quickening, matter in motion; currency, currency, and more currency! I’m becoming flabbergasted by the current situation; like the boy who cried wolf too many times or perhaps like Galileo trying to explain just how flat the flat earth theory is and will soon pass. The danger of the wolf (peak oil) is like falling off the edge of the earth; it won’t happen, however, a whole lot of people holding onto a flat earth (failed economic theory) will create a cliff of sorts and that cliff is called depression; the down side of the man made business cycle.
Am I, again, confusing? I am not confused. Language is the problem; we have been trained, since birth, to think in terms of supply and demand where too much supply is as bad as not enough supply. That thinking does not apply to productive energy.
It really isn’t that hard to see; sure it took me 47 years to see it.
Practical application: Making money is what?
Making money; I’ve got to go to work today. I’ve got to pay the bills. My business is in the red: I’ve got to make more money.
Above is old theory. What is being done with “making money” is not making money. What is being done is transforming or ‘making current’ the form of money. Money energizes human activity only when money flows.
What happens if everyone stops the flow of currency; like everyone all at once stuffing their money in their mattress? Guess what? That scenario is called depression. People jump out of high windows; off a cliff.
As long as the money keeps flowing, then, people are energized and energized productively or not productively; but at least energized. Cut off the currency and people stand in lines. Add more currency and people have no time to stand in lines.
Are you with me yet? Here comes the important stuff. If money does not represent something real, then, it inflates. If money represents something real but something static like Gold, then, currency is a fixed supply trying to meet a growing demand. Remember the Flat Earth Economic Theory: Too much is bad, too much is bad, too much is bad, too much is bad.
If money is productive energy, then, too much is ideal.
If you cannot understand anything I write, nothing at all, then focus on that sentence above and PLEASE ask questions.
If money is productive energy, then, too much is ideal.
Even the most ignorant, lazy, good for nothing, peaceable moron is a better human being than one misguided capitalist. The bum won’t get in the way of producing productive energy into an ideal state of abundance. Even the bum will know enough to invest, when investment is possible, in productive energy once the obvious gains are known. The ones who won’t like investments in pushing the limits of productive energy production are greedy capitalists, despots, authoritarians, and energy monopolists. I am nearly certain that criminals know exactly what I am trying to communicate. It is a simple power for power equation.
The earth is not flat.
JoeTKelley, you are saying,if I get it right , that markets lose the capacity to rationally distribute commodities because power considerations will always trump efforts to keep markets "free"? In order to maintain power,invested agents will always subvert the free flow of information needed for the market to operate rationally? Am I selling my "productive energy" in the market or the use-value of my labor? While my energy may be abundant I am unable to convert that into into an abundant wage, or able to exchange it for abundant commodities because there are so many under-utilized workers,all with productive energy, willing to under-sell their labor power just to stay alive.
Troutsky,
Thanks for the precious dialog. You communicate a question: “if I get it right”.
Have you seen the commercial where the “Boss” buys a cell phone that allows him to call anytime, anywhere, and he proclaims his new found power to “Stick it to the man”. His employee (not a yes man) says: “You are the man; so doesn’t that mean that you are sticking it to yourself”. The “Boss” says “Maybe”.
Well…I am the “Boss” of my thoughts and you “get it right” maybe. Are you willing to find out if you do “get it right”?
If so then lets do battle. Let our ideas compete and let the chips fall as they may.
I am inspired to first point out that “Markets” have no sovereign will. Individual sovereign human beings do have will power. So “Markets” cannot “Lose” anything. People win or lose. A Labor Union for example will have one sovereign individual human being who makes the final deal in competition with the individual human being commanding a group of producers. The final decisions may be a product of internal negotiations but the final ‘deal’ is always one final ‘individual’ decision. The “labor” leader says this is my final offer. The “Capitalist” says yes, no, or counter offer. Each member of each group, then, can say “Yes” or “No”, I will continue to be a member under these new conditions or I will move on.
The power of Markets, then, is something called consensus, popularity, or fashion. The power of one individual’s personal actions, as that individual manages to affect fashion, is a power that can change the world; like a pop singer or megalomaniac.
I don’t want to lose this power of dialog; our mutual desire to exchange ideas. I don’t want to diverge too far from our present common interest. The above is meant to address your specific statements concerning what is and is not a “Market”. “The State” is a market too and it does not exist if people do not imagine it into existence through the process of falsehood; pretending to give no one and nothing an ability to be responsible. Markets and “The State” have no will and therefore no capacity for responsibility.
You use the word “Always” as if suggesting that my perspective is in agreement with yours. Maybe this is right; in part.
The right part is perhaps found in the dynamic thinking process. “Always” communicates a process where action continues in time. The wrong part is the absolute nature of the word “Always”. Greater power always trumps lesser power. I agree; this is self-evident.
Invested agents do not ‘always’ subvert. A member of a labor union may ‘defect’ and start his own business to trade with other labor union members and trade equitably with any producers. A capitalist may ‘defect’ and start his own company to trade equitably, openly, honestly, mutually, and cooperatively with any other human being willing to reciprocate.
“Am I selling my “productive energy” in the market or the use-value of my labor?”
The emerging energy market can answer the above question very well and to see this clearly it may take more than this comment section allows.
I am inspired to end my comments with a request.
Define: “productive energy” and define “use-value”, please, I see two phrases that mean the same thing when viewed from a dynamic perspective.
Joe,
As I see it, it doesn't matter a great deal what particular commodities are used to back a medium of exchange. In the end, all exchanges are exchanges of labor between producers, unless the state artificially inflates the returns on something besides productive effort. And without state restrictions on credit and the medium of exchange, producers can probably use just about anything (through mutual agreement) to facilitate the exchange of their labor. The problem is state-imposed restrictions of the circulating medium, and state-imposed entry barriers to the supply of credit or a circulating medium, that make it impossible for workers to translate their labor immediately into purchasing power through voluntary local association.
Kevin,
You currently see “it” as you state. Your viewpoint may change soon. As I see it the change is inevitable and the sooner the better; but none-the-less inevitable.
Case in point:
Which is a better investment?
A. A commodity that contains no actual utility (productive energy)
B. A commodity that contains actual utility
Which investment gains value as the supply of commodities containing actual utility decrease?
A. A commodity that contains no actual utility
B. A commodity that contains actual utility
Examples commodities that contain no actual utility (productive energy):
A. Fiat currency
B. Gold
C. Stocks
D. Bonds
E. Federal Securities
F. Labor notes
Examples of commodities that contain actual utility (productive energy):
A. Oil
B. Natural gas
C. Coal
D. Uranium
E. Sunlight
F. Wind
G. Electricity
H. Hydrogen
I. Human labor
Extrapolation:
The supplies of oil, Natural gas, Coal, Uranium, and Electricity are currently in decline (total available productive energy). The decline is measurable; the causes of the declining supply are both forced by nature and man; the decreasing supply is none the less actual, real, and measurable (national debt is one measure).
The supply of Sun light and wind remain abundant.
The supply of devices that convert Sun light and Wind into Electricity and the supply of devices that convert Electricity into Hydrogen are increasing as are the factors of efficiency concerning rates of production over costs of production for these valuable devices (commodities).
The rates of production of electricity using Oil, Uranium, Coal, and Natural Gas are decreasing while costs increase (bad news).
Man cannot produce as much usable commodities (of any kind) without actual utility commodities (productive energy) including human labor and cooperative human labor (human utility energy). Human labor must be fed by actual productive utility energy commodities like Food (produced by fuel), Air (polluted by the wrong fuel), Heat (produced by fuel and electricity), Cooling (electricity, fuel, etc.), trade (fuel), and an exchange medium (counterfeit debt money or actual credit money?).
Therefore:
Which is a better investment?
A. A commodity that contains no actual utility (productive energy)
B. A commodity that contains actual utility (productive energy)
Which investment gains value as the supply of commodities containing actual utility decrease?
A. A commodity that contains no actual utility (productive energy)
B. A commodity that contains actual utility (productive energy)
You wrote:
“As I see it, it doesn't matter a great deal what particular commodities are used to back a medium of exchange.”
A commodity like electricity contains actual productive utility (it is called a utility) and therefore this commodity is currency (better than gold as currency because an inflated supply of gold is not desirable while an inflated electricity supply is desired, always usable, and prefered – inflation is prefered with electricity because the more electricity produced – the lower will be the cost of electricity)
A commodity like hydrogen contains actual stored productive utility and therefore this commodity is a perfect capital savings commodity. It can readily be turned back into currency (electricity) and it has that same valuable property of utility value whereby the more the better because the greater the supply the less will be the cost and the less the cost the greater will be purchasing power.
You wrote:
“In the end, all exchanges are exchanges of labor between producers…”
If two people were to exchange the produce generated from a Solar Panel, Wind Turbine, Hydrogen Generator, then, the labor is done automatically by the Sun and mechanical devices (once paid for in full and fully maintained by relatively miniscule labor costs). Any person can command this power (once paid for in full) and therefore any person can become a net producer of Energy Money (near perfect money flowing automatically and having an almost unimaginable exponential growth rate).
The significance of the last paragraph is almost too bright to see. I see it. You will see it too; perhaps not today or tommorrow. The facts will become self-evident.
If the facts become self-evident soon, then, exponential growth in productive energy utility begins sooner. If the facts become self-evident later, then, the value of a Solar Panel, Wind Turbine, Hydrogen Generator system will be so obvious that the choice will be as clear as night and day, as clear as having to work hard and having to work less, as clear as comfortable tempurature and freezing or burning up, as clear as a full belly and starving, as clear as the choice between credit or debt.
Investment:
A. The last scraps of Oil (Oil shares, oil stock, oil drills, oil production) at high costs with little return.
B. Automatic independent productive energy utility generators
It does not matter what “Spin” is placed on the names we call the stuff we need. When the stuff we need is going away, then, we find another way to get it. Trust in the Human capacity to survive includes a trust in the human ability to cooperate. The medium we use to facilitate cooperation can be a more efficeint medium than just any old commodity or counterfiet commodities. A medium that contains actual, usable, productive energy will be prefered in human future or there will be no human future.
The labor note is second in line in efficiency under Energy Money and here is a significant point to ponder when you see this clearly. As Energy Money reaches that point nearing oversupply, then, labor will command a higher price.
Realizing that last sentence as being true can illuminate how destructive Energy Money can be to The State apparatus and those agents who so efficently cloud our judgement.
I am eager for dialog that refutes the obvious self-evident facts. I do not enjoy being wrong; it is so wasteful. As yet there have been many readers pondering this Energy Money discovery; as yet no one has found a bug.
Anyone can begin the process of exponential growth in producing their own Energy Money like investing for a future of plenty; plenty of usable productive energy created, commanded, and traded by sovereign indivdiuals.
Which is the better investment:
A. A 401K savings account backed by debt
B. A device that creates value automatically and can pay for itself once the switch is turned on; can pay for another unit and double the rate of production
Call the electricity and hydrogen anything you wish but don’t call me late for dinner.
In the act of exchange, the value is embodied in the labor products being exchanged. The medium of exchange in itself is nothing but a unit of measurement, providing a common denominator for the products exchanged. Why should the medium itself need to have any value as an investment?
As for energy, its value comes from the cost of producing it. To the extent that the sun is a free good, the only cost involved is the labor needed to produce or acquire the solar generating equipment. That which is a free good of nature has no exchange value, unless someone is put in the position of monopolizing access to it.
Kevin,
At some point we will see the same thing. Meanwhile the dialog continues to fail to find agreement. If both of our perspectives are finding agreement, then, we are both working toward something of value; knowledge. My prediction is that you will see the knowledge soon if you remain objective; as you are doing now.
Continuance of discovery:
“In the act of exchange, the value is embodied in the labor products being exchanged.”
Suppose two possible future scenarios. Both scenarios end up with the exact same condition. The first scenario happens quicker. The second scenario takes more time.
A. Lottery winner invests in a labor savings energy creation system.
B. Conventional investor invests in a labor savings energy creation system.
Both sovereign individuals end up at point C.
C. Sovereign ownership and control of a labor savings energy creation system where all costs of production are paid for and the energy flows at a statistically consistent rate of production: x supply at y costs.
Description of labor savings energy creation system:
1. One 1 megawatt Wind Turbine
2. One 1 megawatt Solar Panel array
3. One 700 liter per minute Hydrogen Generator
4. Miscellaneous automated controls and storage containers
5. Flow recorders
6. Dispenser hardware (A hose to dispense the hydrogen and an electric hookup to the grid)
The lottery winner could invest in this Unit and have it reach the time of Independent output (production in excess of cost) within 6 months to a year or less time.
The conventional investor (selling shares, or building the system incrementally over time where on solar panel pays for the second solar panel which doubles output/cost rates and two solar panels pay for four solar panels, etc.) takes more time to reach Independent output (production in excess of cost) perhaps 10 years time.
The independent owner (once the independent output is greater than the cost at time C) creates actual, usable, sellable quantities of value and the labor (from that time on) required to keep producing that value is nearly zero (certainly much less labor cost than value produced).
“The medium of exchange in itself is nothing but a unit of measurement, providing a common denominator for the products exchanged.”
Now suppose that both A (lottery winner) and B (conventional investor) open their doors to the outside world for business. Both entrepreneurs have chosen a rural location surrounded by one farmer to the east, one solar panel producer to the north, one gas station/mini-mart to the west, and one gold mine to the south.
Now suppose that the entrepreneur sells his electricity in each direction at cost; which is practically zero. The value of the exchange is something real. It is not a simple unit of measurement. The product exchanged is electricity. A one megawatt Wind Turbine puts out a whole lot of electricity. A one megawatt Solar panel doesn’t care anything about why it puts out one megawatt; it is one megawatt just like the Wind Turbine. Those output numbers include down time. The calculation can work on averages so the 2 megawatts (if battery storage is used) can be a consistent average output.
“The medium of exchange in itself is nothing but a unit of measurement, providing a common denominator for the products exchanged.”
The medium of exchange is itself something useful. The farmer pays very little for electricity (perhaps the farmer pays a percentage of maintenance costs). The energy entrepreneur accepts debt money in return (pfffffffft).
The Solar Panel producer can now reduce his costs of producing Solar Panels because he also receives the cheap utility electricity (perhaps he pays a percentage of insurance costs to ensure the Wind Turbine against loss or damage). Again the Energy Entrepreneur may choose to accept debt money (fiat currency) in exchange.
The Gas Station/mini-mart producer can now reduce his energy costs and if he desires he can lower his prices to reflect those cost savings. The Energy Entrepreneur may use the reciprocal transfer of debt money to pay legal debt (land taxes).
“Why should the medium itself need to have any value as an investment?”
To bypass The State is the easy answer. It takes a little adjustment in thinking.
Looking to the south our Energy Entrepreneurs (both the lottery winner - a year or less from now and the conventional investor in 10 or more years from now) sell cheap electricity to the gold miner and reduce the cost assumed by the gold miner. The exchange medium chosen by the Energy Entrepreneur could be gold or instead the Energy Entrepreneur could use debt money to buy a hydrogen fueled gold mining machine (A 992 Caterpillar Loader converted to run on hydrogen gas).
Why use gold? Why use labor notes?
Productive energy is a labor savings commodity that flows and stores and contains usable productive energy within it self. It is nearly perfect money.
Why use fiat currency? The costs of using labor notes, Gold, and fiat currency are progressively and exponentially greater than Energy Money because they do not contain any productive energy internally; they chase around human labor, Gold, and fiat currency respectively while the creation of more usable productive energy is left to chance or individual sovereign judgment; like yours and mine.
Now imagine that no Energy Entrepreneurs (neither the lottery winner nor the conventional investor) plopped their Energy farm in either location.
The farmer pays current energy costs (that will rise). The Solar Panel maker pays current energy costs (that will rise). The Gas station/mini-mart owner pays current energy costs (that will rise). And the Gold miner really doesn’t care much. He works the laborers and needs no 992 tractor to get enough gold to stay rich.
One more angle before I retreat back into my position of wonder (I really wonder if this can be as bright as it seems; the reason why I am asking for a challenge).
Buying a refrigerator is a debt purchase. A person could make a refrigerator a credit purchase if his house made productive power from the Sun or Wind. No cost and cold food. A person could hire a family from China to ride a bicycle hooked up to an electric generator and run his refrigerator Day and Night (The Chinese mom can take the graveyard shift – the Dad could take the day job). How is that any different from buying shoes made in China and shipped here? The difference is in the details. The principle remains the same.
Kevin,
I am going to jump ahead and post again since you seem to be busy expending time and energy in other directions. My time and energy expenses are focused right here; right now.
You wrote:
“As for energy, its value comes from the cost of producing it.”
The above is an incomplete sentence that becomes complete when placed back in context.
You and I both share an appreciation for the value of the cost principle. If a Chinaman spends x amount of hours making a shoe, then, a Chinaman is worth x amount for his time laboring; no different than any other human being doing the same amount of labor living on the planet.
You and I see the value of this principle – yes or no? I assume yes, otherwise my time and energy expenses would not be focused right here; right now.
I look back at the post that started this comment section. You found and rebroadcast that article for a reason. My assumption is that you saw value in it.
I see value in the error. It instructs. It shows how misunderstandings lead to missteps and wasted energy, worse, destructive energy. Destrutive because the better step is harder to see while the error remains unrecognized. The error becomes falsehood; an embraced error accepted as valuable information leading to false knowledge; worse than ignorance.
You wrote:
“To the extent that the sun is a free good, the only cost involved is the labor needed to produce or acquire the solar generating equipment.”
The above is false; partially true at best like this:
“Decoupling Energy Consumption from Living Standards”
The false part is the wrong path part. The better step is ignored. Had I wrote the same column it would have been titled:
“Coupling Sovereign Energy Production to Living Standards”
You wrote:
“In other words, they were too friggin lazy to do something as simple as stack their newspapers in the basket when they got done with them, and then pile empty bottles and cans on top.”
The reason why coupling sovereign energy production to living standards doesn’t capture the imagination now is a simple matter of supply and demand. So long as energy flows at affordable rates; the work (thinking first) required to generate personal, sovereign, independent energy is a greater cost than taking the steps that create energy independence; like doing something as simple as ordering a Solar Panel (installed) and opening an energy savings bank account to finance the next Solar Panel.
The electricity and hydrogen automatically generated from independent sovereign power houses will not make anyone rich overnight; today. The Sun is the free part. The cost of generating usable energy from the sun involves production costs to acquire and own the equipment (paid for in full). From then on the energy is not cost free but almost cost free (a significant distinction).
You wrote:
“That which is a free good of nature has no exchange value, unless someone is put in the position of monopolizing access to it.”
The above is completely false. Perhaps the words were written in haste. Perhaps I am wasting my time and energy trying to communicate something that can not penetrate the falsehood here and now. Price and cost are not interchangable words. Charity and Robbery exist and neither will be wished away.
Giving away 1 megawatt each hour has exchange value. So long as the people receiving the gift use that free productive energy in reducing the costs of production (and reduce the price) so long will a free good of nature (productive energy) have exchange value.
If a tribe of cavemen spent years freezing to death up north and somene came up with the bright idea to make clothes, then, what good would the cloths do if the people receiving the cloths used the cloths to wipe their asses?
Please excuse my liberties in speaking freely. My guess is that you would have it no other way.
Joe,
Again, though, the medium of exchange is in itself just a unit of measurement for calibrating the values of the things exchanged. The parties to the exchange are "investing" the labor embodied in their products in the product offered by the other guy. And so long as the state does not artificially privilege any particular form of currency backing, working people will not have trouble monetizing any number of valuable commodities as media of exchange (as William Greene put it in Mutual Banking, "anything that can fall under the hammer").
I also think you're confusing exchange value with use value. I don't dispute the use value of solar power or of clothes, far from it, but their exchange value comes from the cost of producing them.
Kevin,
I am not sure why you used the word ‘again’. Do you think that I didn’t read it the first time?
“The” medium of exchange is as you put it: “any number of valuable commodities as media of exchange”; therefore “The” medium of exchange doesn’t “have” to be “Just” a unit of measurement for calibrating the values of things exchanged.
The medium of exchange can be both exchange value and use value. I am not confused about this unique quality of energy money. It makes sense to me. It occurs now. People just don’t recognize the fact. Electricity has both exchange value and use value. Electricity is current. Currency is the exchange value part of money separate from the storage value of money (hydrogen can store value better). Labor makes value and electricity does work (labor). 5.7kW worth of solar power is equal to about 48 laborers peddling bicycle generators. 48 laborers who each own 5.7kW Solar Panel systems can generate their own current (more than they need) for use and currency (sellable money that has both exchange value and use value). Once current becomes currency the less valuable moneys will become superfluous. Current is ideal money. If you can’t or won’t see this, then, this is fine by me. However your critique is understood by me. It is contradictory as if money must be as you demand and at the same time you demand that money can be anything.
As people do adopt current as currency on a wider scale, then, the exchange value of current will push out those other inflationary forms of currency. Popularity is the value of fiat currency; a popular falsehood.
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