To celebrate the 200th anniversary of Ricardo’s Principles of Political Economy and Taxation, Publius has created a liberal platform driven by our need to compete globally in the Information Age. Publius calls this the Growth and Development Party, or GDP.
Ricardo wrote at the birth of the Industrial Age which we left several decades ago for the Information Age. His theory of comparative advantage drove the liberal movement for two centuries. Ricardo’s bedrock of free trade anchors the central liberal belief that markets must be open and transparent enough for everyone to get a shot at wealth creation, whether buying a house or building Apple.
The big difference between now and Ricardo’s time is what it takes to give us a liberal economy. In Ricardo’s day there were no trains, let alone paved roads. Education was not for the rich; they didn’t need it to inherit what they had. The poor couldn’t afford education and there were no schools for them anyway. Education was for the few in the emerging middle class who could afford the social mobility needed to put themselves in positions to create wealth.
Today, we are in a far different place. In the recently passed Industrial Age, goods and services had to be moved to their markets in enormous quantities quickly and efficiently. This lead to a complex of road, rail and air infrastructures. Industrial Age work also required an educated labor force. The infrastructures needed to do this were financed publicly, privately and in combination.
In effect, business could not exist without income taxes to support the infrastructure needed for a liberal market to survive.
Now we have the added complexity of the Information Age. Like goods and services, information too must be moved in huge volumes quickly and efficiently. Moreover, as Walmart and Apple show every day, putting goods and services together with information allows us to optimize supply chains in ways that were unthinkable only a few decades ago. The combination means that Ricardian comparative advantage today comes from a powerful and cost-effective information infrastructure.
That isn’t all. For us to start businesses or maintain and grow them in this increasingly complex space where goods, services and information are deeply infused within each other, the entire population must be educated well enough in the Information Age mechanisms to be employable. And it must be healthy.
Simply put, to gain their Ricardian comparative advantages and profit from the liberal promise of open and transparent access to wealth creation, our citizens must be the healthiest and best educated in the world. And we must be the most cost-effective in the world at attaining both.
See Publius on American Business Needs Four Guarantees.
Business relies on the state to make sure all of this happens. We in business don’t very much care how it happens—Vouchers or public schools? Who cares, as long as the labor force is the best educated and healthiest worldwide—because if it doesn’t happen, or happens only piecemeal, we lose market share. Which means that we lose jobs and stand aside as our economy unwinds. Wealth creation? Forget about it.
To show the future, Publius took the great 1964 work of Marshall McLuhan, Understanding Media, applied it to Ricardo and came up with the next step in liberalism: how open and transparent markets must work in a time when information velocities are going through the roof and information costs are going through the floor.
To understand the basics of liberalism in the Information Age, Publius’ created a McLuhan-inspired Information Cost-velocity Curve (ICVC) along which all organizations must evolve if they are to gain, and keep, Ricardian comparative advantages.
The ICVC has dominated all human organization for all history. Everything that fell off the Curve, from the Roman Empire to Pan Am, vanished. Nothing in their forms or structures can be recreated. Except in a museum.
In our own time, the ICVC has moved so fast that the structure of the 1960s IBM looks nothing like that of Apple in 2017. Ricardo could never have anticipated change this fast. McLuhan could, and did. His 1964 description of how Facebook and Twitter would work appears mind boggling. Until you understand how McLuhan used the simple logic of the Information Age.
Publius' GDP says that to compete we must at an ever-accelerating rate substitute always cheaper and faster information for other factor inputs like land, labor and capital. Doing this will create the consumer surpluses—money consumers have left over when prices fall, what Walmart does for you—that drive economic growth. The demands on our education and healthcare systems will increase fast.
You will notice immediately that no one in any party in Congress is thinking about this. Which is why we need Publius' GDP. Now.
The bedrock of Publius' GDP is maintaining markets open and transparent enough to give every citizen a shot at wealth creation while we move out the ICVC. Thus, Publius' GDP redefines liberalism for the Information Age. GDP is the mechanism that underpins Ricardian comparative advantage in our Zettabyte Era.
Publius has a set of GDP Smart Policies, some already published, covering:
Education
Information
Infrastructure
Drugs
Foreign Policy:
North Korea
You will also soon see many new Smart Policies and a new theory of the firm—how and why companies operate and what to expect as the ICVC progresses.
All Publius' GDP Smart Policies will have certain parameters:
The least possible cost.
The least possible government involvement to minimize taxpayer load.
The simplest possible execution.
The maximum employment potential.
The biggest impact on Gross Domestic Product.
Because the ICVC has been so unforgiving for so long, you will be able to assess the policies of all political parties against GDP Smart Policies. Any proposal that does not meet GDP Smart Policy compliance with the ICVC will fail. You will be amazed at how accurate this will be. Publius first shot at doing this—he predicted the collapse of the Soviet Union and why, in the fall of 1968—was exceptionally precise and well ahead of events. The ICVC is unforgiving.
Publius' GDP will place great demands on our politicians. Do not expect them to rise to the occasion.