Within collectivist groupings such as political organizations, there is a lack of adequate incentives. Politicians are NOT rewarded with a wage based on market factors commensurate with the impact of the value they add or detract. This fact drives the incidence of, for example, sleaze and corruption where politicians use their political power and position to earn indirectly the rewards they do not earn directly but feel they deserve.

For instance, politicians representing and promoting national and international trade interests are performing a valuable service on behalf of lobby groups (groups of people with a common interest such as trade associations or disabled people), yet any rewards for the politicians are at best indirect or unofficial backhanders. Far better for those officials to openly offer their services on the free market and earn a return commensurate to the benefits received by their clients. Politicizing the process simply leads to politicians representing geographical areas where certain industries are dominant being captured by the voting power of those lobbies, for political, and not moral or economic reasons. Faulty incentives lead to flawed outcomes.

FUKUYAMA says in his book "The End of History" that "It is in the very design of democratic capitalist countries that the most talented and ambitious natures should tend to go into business, rather than politics, the military, universities or the church. And it would seem not entirely a bad thing for the long-run stability of democratic politics that economic activity can preoccupy such ambitious natures for an entire lifetime. This is not simply because such people create wealth which migrates through the economy as a whole, but because such people are kept out of politics and the military. In those latter occupations, their restlessness would lead them to propose innovations at home or adventures overseas, with potentially disastrous consequences for the polity." (FUKUYAMA, 1992). This is a fascinating statement that does hold true. We need to avoid the attraction to politics of administrators excellent at playing games and manipulating opinion. We need instead to harness the creative efforts of all individuals to develop wealth creation opportunities.

Bounded rationality is the problem of limited understanding and control of the increasingly dynamic, global, competitive, complex unorganized world. This makes interventions of any type increasingly hazardous. If we do not know what people want or what people do, how can we help or reward them? Unclear circumstances lead to imprecise interventions that have negative unintended consequences. Within a political context, this means that policies help people who do not need helping whilst failing to help those who do.

Even where the need for spending on support services can be established, bounded rationality means that political government policies distort the provision of these services. Political government failure and market failure both have the same outcome- a lower provision of support services than is socially optimal. "This century’s most important economic lesson is that, except in textbooks, government failure is broader, more damaging, more damaging in economic terms and much more threatening to individual liberty than market failure." (ECONOMIST, 11/06/94).

Individuals are smart enough to rationally appraise their own personal circumstances but political governments cannot in the unorganized world fully understand and act upon the divergent needs of the population. We are clever enough to make our own decisions but not to make them for other people. We should not assume that we know or care about other people’s circumstances better than they do.

Dependence exists, meaning that people within the organized organizations and collectivist groupings are dependent upon others in that group for their prosperity. To perform fully and excellently, dependent individuals have to rely upon colleagues supporting them and persuade them of the value of their ideas. Dependence on others is hazardous in situations where there is a lack of incentives and bounded rationality. Static groupings splinter and divide because different members think and believe different things about the decisions going on within that group. Effort is either expended on busy negotiations and compromise to keep the group together- or the static group disintegrates. Either way, the static collectivist grouping does not provide an optimal platform for either internal collaboration or external service and responsiveness to the wishes of the electorate.

Dependence has the inevitable consequence that under representative democracy, people are compelled to accept ratified policies that diverge from their own beliefs. It is inherently troublesome for individual constituents of a particular region, each with divergent interests and their own opinions and aspirations, to reach a consensus of opinion. Furthermore, even if the constituents manage to agree, this opinion is unlikely to be shared consistently across the entire national parliamentary party and political government itself. In this climate then, it is no surprise whatsoever that members of parliament within the same political party, let alone their constituents, cannot agree on a common course of policy. Such differences of opinion are inevitable where freethinking is encouraged. Rest assured, if dissent is NOT outwardly present from the ranks or backbenches, then party leaders are suppressing freedom of opinion and speech.

Political government is a legitimate form of coercion. The political government takes (usually a large) part of an individual’s income through taxation without their express permission or choice. Much of this tax revenue is then wasted by the public sector because of a lack of the discipline, insight and incentives conferred by market forces.

The existence of coercion and force within organized political organizations means that its increasingly dissatisfactory performance cannot readily be changed or circumvented. People are forced to do things: they have no choice but to support and perpetuate political regimes however opposed they are to them. Freedom is the existence of choices, but we have no choice about whether or not there is a political government. No matter how dissatisfied an individual or even a vast group of individuals are, they are required without choice by the laws of their home land to continue paying taxes, thereby perpetuating the continuance of and paying for the mistakes caused by the imperfect static political organizations. Of course, freedom from coercion can only arise when the collective groupings are voluntary and dynamic, such as collapsible coalitions.

These inter-connected problems with collectivist structures explain the increasing dissatisfaction with the way people are served and treated by collectivist organizations of both a political and an economic nature. Faulty incentives, bounded rationality, dependence and force are the underlying elements that make organized organizations the sub-optimal mechanisms for achieving the necessary social and political safety net services.

Let us now have a look at some of the problems with organized political organizations and systems caused by these fundamental flaws.

Inverse relation between interventions and growth

There is an inverse relationship between economic performance and political government intervention. The more that political government intervenes and interferes in an economy, the worse that economy performs. Its actual growth rates achieved are lower than their sustainable potential.

Take a look, for example, at the American economy in mid-1997. The US had an economic environment that had flexible labor markets and an entrepreneur friendly climate that was conducive to starting up new businesses, with a supportive venture capital industry. The US consequently led in new technology and media development such as that related to the Internet, the 21st century’s largest industry. All of this meant lower entry barriers to opportunities to earn a living: the result was low inflation (wages don’t have to go up excessively to attract new employees as people are geographically mobile), high economic growth through wealth creation, and low unemployment. Of course, actual growth still lags far behind potential growth even in the US because of the active political government sector there.

The relatively free market policies seen in the United Kingdom until mid-1997 led to a similar set of robust economic figures, but not as pronounced as in the US. Technology innovations were spurred by greater competition in industries such as cable television and fixed and mobile telecommunications. But this competition was from licensing existing large organizations rather than by US-style entrepreneurial innovation. The venture capital industry was much less active and supportive in the UK and as such many of these new competitors were established organizations, often from overseas.

The UK went back in the opposite direction with greater intervention from the new socialist Labour Party political government elected in mid-1997. They immediately adopted the European social chapter, which reduces labor market flexibility by protecting those in employment (a minority in the continental European countries dominated by socialist political governments (most of them)) and increases employment costs, thereby acting as a barrier to people trying to enter the labor market. (See "Unorganization: The Global Handbook").

All of the countries in continental Europe, encompassing most of the members of the European Union (EU), have far too interventionist political governments. Basically, Europe is hemorrhaging because of excessive political government intervention yet the arrogant national and European politicians insist on greater institutional intervention. European economies are under-performing, yet its political governments persist in thinking that they are the savior rather than the causer of such problems. Socialist politicians continue to think that horrific economic performance necessitates more government intervention, and do not realize that it is their very intervention that causes less economic prosperity in the first place.

As a result they have high unemployment (with around 20 million people out of work in the EU), high political government deficits, low economic growth and poor economic performance in other variables. Yet, low deficits and low inflation are the targets of the so-called "stability pact" (There is no such thing as stability in the unorganized world) which sets out the pre-conditions for the outmoded and dangerous model of European monetary union.

The socialists and other interventionists in Europe, harboring their outmoded organized thinking, are locked irreversibly into implementing a single European currency, called the euro. There are not enough viable eurosceptic political parties for voters to vote for to prevent the single currency and there is a lack of understanding of its economic disadvantages amongst public and politicians compared with the superficial practical advantages that cannot be successfully delivered in practice. So Europe ends up with a single European currency. And quite soon after its introduction, that single currency will hemorrhage. This will occur because European currency is the imposition of a super-organized policy on an unorganized world (See https://www.unorgan.com/europe and also "Unorganization: The Global Handbook").

We will see in detail later that the move to the unorganized world has also given independent people choices such that the adverse affects of the ignorance of politicians and other voters can be avoided. The currency speculators will be there with their hedge funds, and rightly so. Individuals will be able to avoid the fall out from the disintegration of the uniform currency and exchange rates in a very diverse national and regional Europe. They can- and should- keep their savings offshore and in a hard currency such as US dollars.

So on the one hand I would like to avoid the European currency all together, and on the other I am quietly looking forward to it breaking down. The resulting conflict will see the elimination of all social democratic and socialist interventionist political parties. Socialism will be destroyed, just as communism was before it. The voters will get the message that intervention does not work in the unorganized world from the pain in their pockets. Post-euro, only capitalism- and technological capitalism- will be viable economic systems.

Of course, the economic hemorrhage seen in communist countries only further proves this simple principle that more political government means less economic prosperity, as does the dictatorial, collectivist domination in many countries in Africa. No wonder the communists and the dictators will NOT tolerate free elections or free markets. They know that their failure means that they would be immediately replaced.

We should not persist in reinventing collectivism in ever smaller units, until we realize that the optimal unit of economic production is the individual, the single person. We have seen 100% of political government activity as economic income fail, so we tried the 50% of socialism, right on down and far below the 30% seen in today’s relatively free market oriented countries. We still have a long way to go to reach the optimal low, low levels of government.

In sum, the percentage of interventions which the political government can cost-effectively and effectively carry out is falling in direct relation to the extent to which national economies are unorganizing.

Socialism sells but fails

Socialism is the economic system in which the political government controls and dictates a significant proportion of the actions of all the people in that society. Socialism is based on a negative (and false) view that free markets cause economic inequality and not only that but it is political government’s job to intervene and correct that inequality. Socialism is an easy initial sell: it is reassuring and pleasing for people to be told that someone and everyone is going to be taken care of. It is a nice idea in theory that does not work in practice.

The persistent failure of government interventions has forced socialist labor parties to partially accept this truth for themselves. They are moving to greater orientation to free markets. Communists are becoming socialists, socialists are turning into capitalists and capitalists should become technological capitalists who combine economic equality with very free markets.

Obviously the move from socialism to a more capitalist philosophy is necessary but not sufficient for organized political parties and politics to be able to survive in the unorganized world. The fundamental flaws and the sorts of labor market they advocate with trade unions, employment legislation, minimum wages and other outmoded interventions will splinter and destroy jobs in the unorganized world. Individuals will create the best kind of job security there is for themselves by thinking of themselves as brands and creating alternative ways of making a living (See "Unorganization: The Individual Handbook").

Socialists and other collectivists believe that the individual's prosperity is linked to their role, economic and social, in the community. Look around a trade union congress (The British Trade Unions Congress has the motto "Your voice at work". What is it, can’t members speak for themselves?) or listen to speeches by left-of-center politicians or observe the behavior of any other socialists. They are earnest and care deeply about people and genuinely want to help. However, because of bounded rationality, socialists cannot fully appreciate or understand and accurately keep track of their constituent’s desires. Bounded rationality prevents the full circumstances from being understood and the intervention itself therefore has a distorting effect. It must be recognized that planning is hazardous when tomorrow will not embody the same conditions as today. There can be no planning because all of the possible scenarios that the external environment can throw up can never be rationalized and foreseen.

The cost benefit justifications that socialists use to justify policymaking are based on their calculations of other people's costs and benefits. Their arrogance is to assume that they are able to better judge other people's circumstances than those individuals themselves can. These socialists lack the personal courage to face up to their personal limitations and realize that even if they want to help, they can't without hazarding those very individuals. The world is just too complex, diverse and changing, and each and every individual has different needs and wishes. This futile and costly intervention is the greatest tragedy of the twentieth century and biggest danger in the twenty-first. Like managers, politicians need to be smart enough to know when they are not smart enough, and realize that, increasingly, this is nearly always. Individuals need to be honest with themselves and recognize that even if a policy sounds desirable in theory, it is impossible in practice to implement effectively.

This book should be a warning to every individual about the dangers of interventionist institutions such as left-of-center political parties and trade unions (and also right-of-center political parties: there is no "left" or "right" in the unorganized world, just right or wrong). Interventions cause (unintendedly but inevitably) public costs that typically outweigh the benefits of those interventions. It is fundamentally wrong to say that in times of giant economic, technological and social change, more political government intervention can help people to better cope with this type of world. Institutions cannot plan, invest and organize our societies to solve problems. (BLAIR, BBC TV NEWS, AUSTRALIA, 16/07/95). In today’s complex and continuously changing landscape, it is those who genuinely embrace this change and recognize the inevitability of instability who will prosper. The best way in the unorganized world lies not in who can reduce the instability to a minimum, but who can make the most of the opportunities that it brings.

We need to limit the areas where political government is active, primarily through supporting people who believe in the value and use of free markets. These days, the best way to deal with complexity is with simplicity. Less political government is more. The general public suffers most from the follies of political governments, and they must oust interventionist politicians as soon as they can, as much as they can and for as long as they can.

The Austrian school’s view

The so-called Austrian school of economics emphasize "the role of entrepreneurs as the driving force of capitalism and markets as dynamic processes that facilitate innovation and discovery". (PROWSE, 28/02/94). Conditions for equilibria are difficult to achieve because they are always changing: today's products and technologies will soon change. Like stability, equilibrium is as good as unattainable. "To Austrians, this so-called imperfection is not merely unavoidable, but precisely what justifies reliance on the market. For them, markets are the only way to secure adaption to the inherently unforeseeable future."

Even when free markets are not considered efficient, Austrian economists rightly consider political government intervention to be even less desirable. This is because "the sum total of knowledge available in an economy "never exists in concentrated or integrated form but as dispersed bits of incomplete and frequently contradictory knowledge which all separate individuals possess." You and I know far more about our circumstances and desires than a central authority ever could. Even if governments could obtain and process all the information dispersed throughout a market economy (an impossible task [given bounded rationality]), they would still not know enough to make the "right" decisions. This is because we often do not know in advance what knowledge will be relevant to our decisions: we thus could not keep government informed even if this were our goal." (PROWSE, 28/02/94). As such, Austrian economists view attempts to maximize social welfare as ineffective because knowledge is dispersed amongst tens of millions of individuals. As such, "this goal is really nonsensical. Nobody could know enough to measure society's welfare, let alone to maximize it." (PROWSE, 28/02/94).

The state is seen as counterpoised to the market  because political government intervention limits and constrains market activity. Interference by political government can only harm economic performance in the unorganized world. This is the theoretical reasoning behind the inverse relation we observed between political interventions and economic growth.

As such, the Austrian school advocates increasing competition and entrepreneurship, which they rightly consider to be the driving forces behind economic evolution. (SAWYER, 1992). Government industrial policy is then concerned with the reduction or complete removal of barriers to entry in industry to allow free competition and entrepreneurs to take advantage of market opportunities. Because individuals have more decision relevant information than institutions, "The principle task of economic government should thus be to eliminate obstacles that prevent markets operating smoothly... The crucial requirement is that individuals and companies (foreign as well as domestic) always be allowed to enter existing markets and compete away the profits of established companies. With completely free entry, Austrians' claim, entrepreneurial competition becomes an upward spiral leading to ever higher standards of living [through the creation of NEW ideas and knowledge]". (PROWSE, 28/02/94). This emphasizes the importance of contestable markets that individuals can enter by creating novel ideas. We will revisit this topic later.

The appropriate economic government role is therefore minimal, focused on enforcing laws that safeguard the market exchange process and intellectual property ownership rights. Hence, Austrian economists view less government as better government. "In the great majority of cases it is futile and damaging to the growth rate of the economy for attempts to be made to plan the allocation of resources available to the private sector and to frustrate the operation of market forces which, in an open economy, are difficult enough to predict, let alone to control." (LETHBRIDGE, 1993).

In such an environment, it is clearly hazardous for information-starved intervenors to use their visible hand to dictate prices. Only the market forces of supply and demand from the invisible hand can successfully set prices levels for things such as exchange rates, wages and property. Any price setting attempts will simply distort the optimal allocation of resources and end up having the opposite effect to that intended.

For example, in the property market, there should not be artificial rent controls that keep rent prices down, and neither should prices be kept artificially high. Supply of land should not be government controlled, with development land released in parcels insufficient to meet demand.

With exchange rates, governments or monetary authorities should not assume to have the wisdom and knowledge to set exchange rate levels. Even in the old orderly organized world, fixed exchange rate systems broke down and disintegrated time and time again from the Bretton Woods Gold Standard to the European Exchange Rate Mechanism. Yet we fail to learn from these mistakes and persist with follies such as the single European currency.

With wages, there is no case whatsoever for a minimum wage that guarantees a minimum level of wages. This measure is introduced in an attempt to ensure that workers are not "exploited" by employers. That minimum wage is yet another example of a policy that sounds good and fair in theory and yet cannot be implemented successfully in practice- it punishes the very same people that it was meant to help.

But if the minimum wage is set by government at a level which is lower than the wage determined by the free intersection of labor supply and labor demand, then the minimum wage is ineffective and the free market price rightly prevails.

And if the minimum wage exceeds the free market wage, then it prices lower paid workers out of jobs by increasing the cost of employing them. This government intervention necessitates more government intervention in the form of unemployment benefit payments.

Not only that, but like all of the interventionist measures in the employment market such as trade unions and the European social chapter, a minimum wage INCREASES THE ENTRY BARRIERS to the labor market by increasing the lowest cost for taking on unemployed people.

There is a general principle here. All government attempts to artificially fix prices are fair in principle, but always impossible in practice. Free market fundamentals are always better indicators of the truth than opinions that require government intervention.

In the unorganized world where markets reign, "no artificial barriers should be put in the way of individual ownership" and "there must be equality of opportunity for all individuals to pursue the goal of individual ownership". "But a reliance on the efficiency of the resource-allocation function of the market mechanism, even when it is coupled with a respect for the market mechanism by both businessmen and the government... would not suffice to ensure that our economy continually adjusted to changing external circumstances and achieved a strong growth momentum. What is required, in addition, is the existence of individual ownership linked with a strong work ethic and acceptance of the concept of reward." (LETHBRIDGE, 1993).

Individual accountability for success and failure is important in free market economies, where success is likely to be earned through hard work that generates new and novel knowledge, and therefore income for the individual. Honest, talented and hard-working poorer people can thrive by exploiting opportunities where entry barriers are low. They can, for example, publish work on the Internet, and enter an organization without benefits or permanent contracts, remaining in the organization for as long as mutual benefit ensues. This is facilitated by the fundamental forces in the unorganized world that realize technological capitalism (see the next section).

At the same time, social responsibility cannot be foregone towards those individuals unable to take full advantage of the opportunities for individuals. However, "through a steady expansion of the educational system, coupled with the absence of social barriers to enhancement, opportunities for betterment are spreading out." (LETHBRIDGE, 1993). The above comments are all about Hong Kong, a former British colony that reverted to Chinese ownership in mid-1997. As this text about Hong Kong later states: "British workers would hardly wish to gain their livelihood in rough-and-tumble Hong Kong, so unlike the welfare state and its militant trade unionism with which they are familiar". In Hong Kong, families perform the role of the welfare state.

The fundamental forces

We have established the fundamental flaws that cause traditional static political (and business) organizations to be unsatisfactory, with an increasingly threatened survival. We have seen the problems that these flaws cause and the Austrian school has shown us a useful philosophy with which to design economic government. We will now explore the fundamental forces- the underlying economic mechanisms that facilitate alternatives to supplant and replace these organized organizations with their suboptimal flaws of force, lack of incentives, dependency and bounded rationality.

The unorganized world is based on several underlying economic mechanisms called the fundamental forces. The forces ensure that individuals have the opportunity to realize their full potential, prosper outside of traditional organizations and make viable exercisable choices over how they make their living and spend their working life. The fundamental forces are reduced transaction costs and increasingly contestable markets. What determines whether individuals take advantage of these mechanisms is whether they are able to create novel ideas. Independence for individuals characterizes a new economic system called technological capitalism: the opportunity for all individuals to pursue the opportunities. The outcome of all this is the realization of the voluntary exchange principle that no-one need do anything they do not want to. Whereas political government is based on the forced coercion principle, freedom is rooted in the voluntary exchange principle that individuals can do anything they want to do as long as the people they rely on or involve in the completion of that act voluntarily cooperate.

The unorganized solutions

We are looking to design and create dynamic and voluntary political systems that avoid and overcome the fundamental flaws and harness the fundamental forces. These dynamic forms are interchangeably referred to as "unorganized organizations" and "economic government" and encompass, for example, collapsible coalitions and non-party politics in the political arena.

Collectivist organizations have always been imperfect and wasteful environments. The fact that in the organized world they were the primary mechanism for individuals to participate in democracy and wealth creation meant that, as we shall see later in this book, those people precluded from such static structures were disadvantaged. Representative democracy was readily admitted to be imperfect but the best possible system. It is only the move to the unorganized world that has highlighted and worsened these fundamental flaws and enabled the fundamental forces that allow dynamic organizations of economic government such as collapsible coalitions to be fully implemented.

The aim is to overcome the fundamental flaws of organized organizations by ensuring that the power conferred by the fundamental forces is widely available to every individual. We need to remove anything such as static structures that prevents individuals from being able to realize their full potential. To achieve this, we need to:

introduce full and dynamic incentives that reward individuals for the value they add. The existence of adequate incentives insures that people are rewarded for positive contributions and not rewarded for negative contributions, including no contribution at all. Optimal and accurate incentives are best secured from free market-based transactions. Such effective and accurate incentives reward efforts and entrepreneurship by leaving the monetary manifestation of that wealth with its creators. This means minimal taxes.

The free market, the private sector, is the cornerstone that enables us to achieve our objective of introducing full and dynamic incentives that reward individuals for the value they add. The invisible hand of free markets also minimizes the adverse consequences of increasing bounded rationality by minimizing the visible interventions from institutions. As we saw from the Austrian school of economics, competition within free markets also creates positive exercisable choices for individuals that they can pursue voluntarily.

We need to recognize the existence of and minimize the effects from increasing bounded rationality by reducing interventions from institutions. Intervenors should recognize their bounded rationality and reduce their involvement in the unorganized world by, for example, the simple avoidance of policies and interventions. Managers and politicians should voluntarily give up intervening and remove structure before the market takes it away by force. If they do not, because of the voluntary exchange principle, individuals, be they employees, customers, shareholders or whatever, can exit and avoid that transaction anyway- by taking themselves and their money elsewhere and offshore.

We need to supplant dependence with independence

We need to eliminate force and create positive choices pursued voluntarily

To overcome the organized fundamental flaws and harness the unorganized fundamental forces, we need to target the implementation and realization in practice of the "Most unorganized" solutions listed and described below:

Individuals should move from being rankers to being branders by the systematic development of "lifestreams": alternative means of earning a living that usually develop from the unique interests, talents and hobbies of each and every person. Branders are individuals who think of themselves as brands and recognize the importance and value of their differences by developing lifestreams. (From rankers to branders via lifestreams is detailed in "Unorganization: The Individual Handbook").

Business organizations should strive to become collapsible corporations. This is a move from static and forced environments to dynamic, voluntary and impermanent collaborations between branders.

From party politics to non-party politics

The representative party political system that currently survives around the world entails the election of a representative from a particular geographical region as a member of political government. Party politics means that local candidates are associated with a particular political party. One candidate typically represents each political party in each parliamentary constituency.

This party political system has a number of significant disadvantages. The vast majority of voters do not have a positive choice to make. They do not like all of the party policies or all of the party members. Party politics reduces the range of voter’s viable choices to an absolute minimum. Local voters know that a vote for a non-mainstream political party is effectively a wasted vote because that party is unlikely to be voted in locally and certainly not nationally. Today’s voters often support a particular single issue or parliamentary candidate but are not be able to achieve anything positive by exercising their vote for that candidate. Indeed, most voters face an effective choice only between two political parties who have sufficient critical mass of support locally to make any difference. For example, in some affluent areas of countries, socialist parties gain so few votes that there is little point in voting for them.

The party political system also fails because these days, politicians in the same party hold different views. Currently, politicians (usually) tow their party’s line irrespective of their personal opinion. Parties either ruthlessly suppress divergent opinions or implode as they try to keep together to stand a chance of governing nationally with a majority of seats. This is the practical manifestation of the flaw caused by dependence on others.

Viewed cynically, it is of course also an advantage that party politics does reduce and therefore simplify the choice for voters. If people do not vote tactically but instead exercise their personal choices irrespective of local or national party support, then this could well bring about a hung parliament splintered between multiple parties and views. The internal focus this situation would bring and the difficulty in securing enough support to pass new legislation would be one of the best things to happen in the outmoded political system of representative democracy for a long time.

To solve these problems, I propose that party politics is abolished along with representative, geographical political systems and is replaced by non-party politics. After all, parties do not matter, people and their opinions and ideas do. Under non-party politics, individuals championing a particular cause or opinion would pursue its implementation using free market-based mechanisms. People then have the chance to support people who have ideas and support causes that they share. Such support could be in a monetary or non-monetary form. If no such spokesperson exists- that person can become it. The success of that venture would be measured in the same way as that of a business venture- by the number of people willing to associate with, contribute to and work with both the cause and the people championing the cause.

Rallying support for a particular issue would bring about "collapsible coalitions"- impermanent alliances of diverse groups bought together by shared agreement and support of ideas and opinions. Collapsible coalitions are just like collapsible corporations- they share the same characteristics of voluntary impermanent organization forms, but the individuals cooperate and interact for social and political ends rather than the business reasons which stimulate the formation of collapsible corporations. Given that both collapsible corporations and collapsible coalitions use market mechanisms to achieve their purpose for existence, they are very similar indeed. Once the issue has been resolved, the coalitions can disband. At any one time, an individual can be associated with any number of coalitions- to a lesser or greater extent, depending on their interest and circumstances.

Non-party politics would overcome many of the flaws inherent in keeping a rigid party political system when voters and politicians all hold different opinions. It would be a simple evolutionary change but with widespread positive impact.

Distributed democracy

Democracy is the right to have a say in decisions that affect us. Freedom and independence are represented by the ability to avoid other people’s decisions and actions that affect us adversely.

Currently, the fundamental flaws mean that individuals are forced to depend upon political governments who face faulty incentives and suffer from bounded rationality. As such, whilst democracy is an inalienable right for individuals, political governments are no longer the best (or only) way of letting people have their say and get their way.

It used to be the case in the organized world that the representative democratic system of electing a representative from a particular geographical region as a member of political government worked fairly satisfactorily. Less mobility and greater uniformity in appearance and behavior and expectations amongst citizens were more prevalent then- and broad agreement in preferable policy direction tended to result. Things just seemed more clear-cut and separable in those days: there were (very wrongly) enemies, races, classes. The fundamental flaws such as bounded rationality existed but were less pronounced and the alternative solutions harnessing the fundamental forces were less viable.

This representative system of democracy introduced an artificial official hierarchy, with the prime minister or president at the top with a cabinet of ministers underneath, backbenchers and so on. A single politician represents the interests of tens of thousands of constituents.

This system of representative democracy is replete with multiple problems. It is hierarchical in a world where hierarchies are too rigid and too slow. It is based on geography in a global world where location is irrelevant. It is indirect in that individuals rely on their politicians and the political system to get their ideas implemented. The quality and worth of the idea is not as important as whether it fits into the particular ideology supported by the political government at that time.

The representative democratic system is based on geography. This means that the activities of politicians can be influenced or even "captured" by lobby groups. Industries tend to cluster in environments that are conducive to their production. As such, for example, politicians in states where the wine or tobacco or gambling industries are located pacify and support those industries, realizing the clout that lobby has in their region. These industries are supported for political and not economic or moral reasons. In the unorganized world, geography is becoming less and less relevant.

We need to abolish representative democracy and move to distributed democracy to overcome the above problems and also ensure that:

1. Politicians cannot coerce individuals into accepting them or their policies, or make them fund these politics and policies by forcing the payment of taxes.

2. Individuals cannot vote in politicians such as Hitler and Blair against the wishes of other individuals.

A new political system is needed to replace representative democracy and protect individuals from the ignorance of politicians and the ignorance of voters.

I call this system "distributed democracy". It is needed to safeguard individual liberty in the twenty-first century. "Intelligent members of the New Left... have not grasped, emotionally or intelligently, the concept of noncoercive cooperation, of a society that lets everyone gets what he [or she] wants". (FRIEDMAN, 1989). Distributed democracy will deliver noncoercive cooperation such that people are not forced to accept policies which they do not support.

Direct, distributed democracy is characterized by an absence of an official hierarchy. Instead of people having to go through intermediate politicians to get their opinions heard and acted upon, under direct democracy, people can use free market mechanisms to join and set up collapsible coalitions. The widespread technologies that are the cornerstone of technological capitalism can be used to communicate ideas and opinions directly to other people who do or do not share that opinion. Geography is not important- people meet face-to-face when they can and will, or otherwise communicate through electronic means.

Distributed democracy consists of decision making power that is so widely and broadly dispersed amongst so many individuals that no one person or group of people could ever acquire enough power from all of those individuals to seize control of policy making. Even those people or groups with a great deal of money and large numbers of people in support are unable to force other people who do not agree to share their opinion and act in a certain way. The extent to which that coalition is powerful is dependent upon its ability to persuade other people that its cause its a valid one. Other groups holding other opinions on the same topic will champion other opinions.

Take a few examples of how issues and problems would be resolved under a system of non-party politics featuring collapsible coalitions in a direct democracy:

1. There is a natural disaster. Local companies, people, experts in those types of disaster come together to minimize the effects of the disaster and recover from it. Some of those people are there for monetary rewards, others for community and public relations and public service. Once the clean up operation is complete, the work of that coalition is wound down. There is no need for political government to play any role- too often it coordinates resource allocation when the private sector and free markets can do the same job in a better way- by avoiding the fundamental flaws and harnessing the fundamental forces.

2. A new disease emerges whose origins are unknown. The medical community, pharmaceutical and biotechnology companies, affected people and their families all cooperate for different rewards and reasons in order to find out more about the disease and work out what to do about it. The people and companies that can come up with the best ideas that treat or prevent the disease are most rewarded. Patients volunteer to be carefully tested with treatments that are believed to be effective- these tests are undertaken carefully because it is in no-one’s interest for adverse effects to occur- this would be a public relations nightmare for the medical company which would reduce their future market success. As we will see in the "Making individuals accountable" section, markets confer the ultimate level of accountability.

3. The millennium or some other celebration- national or global- is approaching. To celebrate the event, the invisible hand of the market allocates resources in proportion to the public interest in the event. There is no political government role- they only get involved because they are trying to associate value with a particular nation state- they are trying to artificially assign worth to a collective structure that means nothing and is not important. To the extent that the general public feels proud of their nation, the market will meet their requirements to signal and celebrate their proud feelings about their nation.

We need to move from institutional democracy to individual democracy, from divergent democracy to distributed democracy.

Even if within distributed democracy an individual’s point of view is held by only a tiny minority of other people, they can avoid the adverse effects of those decisions by harnessing the fundamental forces and achieving voluntary independence (see below). Even if some individuals are ignorant enough to support and use something like the single European currency, other voters can avoid the adverse affects of it. Collapsible coalitions are successful only to the extent that people believe in and support the issue it was formed to champion. Other individuals outside that coalition need not be affected by it.

Under direct democracy, the ability for everyone to have a say and get their way will be so widespread that democracy will almost be taken for granted. We will no longer have to tolerate and monitor the elite hierarchy of a few hundred politicians who affected our lives under representative democracy- seldom for the better. They will no longer exist.

There is no need for "local" government because people will locate and publicize the issues that affect them wherever they may be. The local people will identify and raise the issues that bother and affect them, rather than being forced to accept and pay (more than the market rate) for policies mandated by local or national government.

The fundamental forces revisited

The fundamental forces provide the basis for each and every individual to create wealth in the unorganized world. Lets take a look at each of the fundamental forces in more detail:

Realization of the voluntary exchange principle

It is the realization of the voluntary exchange principle that allows individuals to choose to exit and avoid unreliable institutions such as organized business and political organizations.

In the organized world, people had limited choices. To be accepted and allowed to participate in economic and social activities, individuals had to conform to societal norms, such as traveling to their office to work in a suit and behaving in the ways their company and political government prescribed. They were dependent upon such institutions for accessing wealth and earning their living. Individuals had to no choice but to comply with top down interventions from institutions.

The unorganized world has seen the full realization of the voluntary exchange principle that no-one need do anything they do not want to or do not agree with. This works both ways of course, with an interaction only taking place if all parties to that transaction voluntarily agree to associate. Individuals can do anything they want to do as long as the people they rely on or involve in that act voluntarily cooperate. For example, the business of meeting customer requirements in the unorganized world entails voluntary interactions between different people with different skill sets collaborating impermanently to closely meet that demand. This is a collapsible corporation. The interaction ends when no two people remain connected.

The realization of the voluntary exchange principle means individuals are no longer dependent on their organizations for economic prosperity. There is no need for individuals to negotiate. In the unorganized world in which people have brand identities, opportunities are global and can be accessed through low entry barrier media such as the Internet, nobody need ever accept the word "No". If a manager tells me that I must do something I do not want to do or says that I cannot do something I want to do, then I have the option of NOT complying with that intervention by leaving. I can then earn my living doing what I want to by forming interactions with other people. Force is futile, voluntary viable.

Never negotiate. Go elsewhere. Conflicts of interest and deviant opinions need no longer be tolerated. Independent individuals will never again have to do anything they do not want to do, and will never be precluded from doing what they want to do. Of course, they can only do what they want to do if other people agree- but in the unorganized world, there is always more than one way to get something done: there are always viable choices for individuals to choose from in contestable markets. The only limited resources are to be found in other people’s heads- but hopefully our own attitude is not a constraint in a world where only the "Buts!" keep us on our butts.

We have moved from an organized society in which individuals had little choice but to comply with institutions to survive successfully to an unorganized world in which everyone volunteers to participate. This is a positive change because the managers and politicians in the organized world "… never turned around to see the frowns on the jugglers and the clowns, when they all did tricks for you. You never understood that it ain't no good, you shouldn't let other people get your kicks for you." Bob Dylan, song lyric, "Like A Rolling Stone".

Reduced transaction costs

It is reduced transaction costs that are making collapsible corporations and coalitions feasible as a more dynamic form of organization.

When you arrange for a task to be carried out, you can use an organized organization or a market to do it. You can carry out the economic or political activity yourself or get someone else to do it. A market is an open dynamic external mechanism for carrying out activity. An organized organization is a formal stable internal mechanism for carrying out business and political tasks.

Organized organizations were set up because the transaction costs (the costs of getting into a position to carry out activity) incurred from using the market were higher than those from using the organized organization. Hence, activities were carried out in-house so that the politicians and managers did not need to keep negotiating with external entities outside the organized organization and finding out from markets the changing prices for production resources.

But transaction costs arise within institutions, as well as in markets. All of the monitoring and negotiating that goes on is transaction costs generated by the forced interdependence between people who were compelled by proximity and contractual relations to work together. In fact, the transaction costs were often much higher to carry out the same activity using the organized organization rather than the market. This occurs because of the accumulated policies and procedures that organized organizations acquire over time.

However, transaction costs generated using markets have fallen rapidly in the unorganized world. As such, whereas in the organized world the preferred way to carry out business was within the static integrated organization, in the unorganized world, using the market and forming dynamic collapsible corporations and coalitions is an ever more viable and preferable option.

It is the invention and availability of new enabling technologies such as the Internet and electronic agents (personal electronic programmable servants) that has caused the rapid fall in the transaction costs incurred when using markets rather than organized organizations. I can send such electronic agents out to negotiate on my behalf. I can be working and my electronic agents can simultaneously be sorting out my future work. In the unorganized world, individuals are assisted in achieving their objectives by technologies that make the communication, education and negotiation process easier.

Realization of contestable markets

It is the realization of contestable markets that allows collapsible corporations to successfully enter and exit unorganized world markets.

The invisible hand that coordinates the interchange of supply and demand for goods and services is a key mechanism in the unorganized world. It is through markets signaling the requirements for different products and services that entrepreneurs can freely enter or exit the market to meet these requirements. In the unorganized world, there are not only global free markets, but accessible, contestable global free markets.

"A contestable market is one in which the positions of incumbents is easily contested by entrants." (BAUMOL et al). There are three pre-conditions for markets to be contestable:

There must be no high entry barriers, such that new entrants do not incur cost disadvantages when entering the market or industry compared with existing organizations.

There must be no heavy sunk costs: these are the costs that cannot be subsequently recovered. For instance, if I develop some software, those software development costs are sunk, irrespective of the level of business I subsequently make from that software. Low levels of sunk costs make hit and run industry entry viable. All sunk costs should be recoverable if the new entrant subsequently wants to leave the industry.

There must be a time lag in the response to entry from existing organizations that is greater than the time lag for the entrant to enter and exit. Flexible entrants must be more responsive to market opportunities than established organizations. This allows a profit above the level of costs to be made before existing organizations can respond.

Lets take a look at each of these pre-conditions of contestability and determine the extent to which they hold true in today’s unorganized world:

There are no high entry or exit barriers and no heavy sunk costs because of the heightened use of outsourcing and partnering. (These are detailed in "Unorganization: The Implementation Toolkit"). In the unorganized world, low transaction costs means that business is carried out in the form of partnering between people whereby an entrepreneur has an idea and then outsources the production of that idea to a partner. As such, the entry and exit costs for that entrepreneur are low and contestability high.

A time lag exists because established organizations neither think nor act in the manner and form necessary to thrive in today’s unorganized world. Too few have downstructured (removed their systems and structures) to speed up their responsiveness and free their people to create new ideas. They retain outmoded organized modes of thinking and acting, and this is the very behavior that puts them at threat from new entrants such as collapsible corporations.

Collapsible corporations are much more likely to respond quickly to market opportunities than existing organized organizations. They can form around an opportunity, calling in people with the required expertise and exit again in no time once the job is done, collapsing that particular configuration of corporation.

The unorganized world is one in which experience only matters to the extent that it CANNOT be forgotten. It is a world in which today is not like yesterday, therefore yesterday does not matter. The ability of incumbent industry leaders and participants to remain leaders or participants in the future is highly suspect. They are too static and structured and successful to continuously reinvent the organization. As such, industries are increasingly contestable. The implication is that established incumbent organizations can in no way take their existence or success for granted. Size does not matter, behavior does.

These three contestability pre-conditions do increasingly apply in the unorganized world. As a result, any inability to meet a customer's requirements at appropriate prices or any attempt by existing organizations to increase prices above the levels that reflect a fair return on investment always provokes new collapsible corporations to enter the market.

The basic premise of the economic theory of contestable markets is that providing that the threat of competition exists, the outcome is exactly the same as under actual competition, i.e. perceptions become self-fulfilling prophecies. Under the contestability framework, government regulation of markets is deemed unnecessary in all contestable industries. Even dominant organizations are restricted in their ability to exploit their power by the threat of new entry. Economic inefficiencies such as high costs and high prices are attributed to high entry and exit barriers and not industry concentration (few players each holding significant market shares). Hence, industries should be deregulated to allow new entrants and more competition to encourage efficiency. Thereafter, government has no regulatory role to play. This corresponds with the Austrian school’s views.

Collapsible corporations are configured dynamically because they have low entry and exit barriers. Collapsible corporations are those in which entry barriers are low so that individuals are able to quickly and easily become members when appropriate, i.e. when they are able to add significant value. There are no heavy sunk costs such as the provision of perks and benefits to employees by the organization. Such benefits increase the dependence of individuals on their employer for retaining their current lifestyles. Benefits also prevent individuals from being able to enter and leave the organization as appropriate without personal financial disadvantage. The financial disadvantage of joining a collapsible corporation that subsequently goes out of business is just the couple of weeks it takes to get a new job if that employee has transferable abilities. This allows talented people to thrive in their chosen areas of excellent expertise (known as lifestreams: See "Unorganization: The Individual Handbook" for details.)

In sum, the fundamental forces in the unorganized world mean that bounded rationality can be avoided because of the voluntary exchange principle whilst reduced transaction costs facilitate collapsible corporations which can profitably enter and exit contestable markets. This is the economic framework that underpins the unorganized global economy and allows each and every individual to create wealth.

Lets look at each of these fundamental forces to see if they hold true in today's unorganized world:

Yes, the voluntary exchange principle exists for individuals thinking of themselves as brands and using low entry barrier media to reach the global world.

Yes, transaction costs have fallen because of enabling technologies.

Yes, markets are increasingly contestable because outsourcing and partnering reduce entry and exit barriers and sunk costs.

The fundamental forces are inter-related. There is little point in collapsible corporations being possible if markets are not contestable. There would be little need to leave organized organizations if their managers did not suffer from limited understanding and could react quickly to new opportunities in contestable markets. The fundamental forces are based not upon opinion, but firmly on market-based economic forces. These economic mechanisms are becoming reality on a daily basis around the world.

The existence of the fundamental forces means that the fundamental flaws of lack of incentives, bounded rationality, dependence and force can be avoided and overcome.

These market mechanisms are also the facilitators of a brand new economic system called "technological capitalism" and is the opportunity for all individuals to pursue the opportunities by combining economic equality with very free markets.

Technological capitalism

The fundamental forces facilitate a brand new economic system called technological capitalism, in which individuals can participate more easily in, and benefit more fully from free market economies. Technological capitalism is the opportunity to pursue the opportunities. It is the basis for individuals to be able to be all that they can be- and pursue and realize their positive dreams. Static structures will no longer preclude or hinder this. Individuals should have the right to pursue opportunities, for example, their own prosperity and their dream of entrepreneurship. "This time next year we’ll be millionaires". This is much more possible given the technological, commercial and social trends that have been described throughout this text.

The widespread availability amongst the general public of enabling technologies facilitates the implementation of technological capitalism. The cost of owning and using technologies is falling rapidly, such that all individuals will shortly be armed with electronic agents, the Internet and mobile phones (These technologies are described in detail in "Unorganization: The Implementation Toolkit").

The unorganized world is characterized by a great deal of economic capacity spread widely across the globe. We are living in a global world that is simultaneously larger yet smaller. In the post-communist world, great wide areas of the world have opened up to freer markets. Yet, infrastructure provision such as telecommunications is simultaneously making these areas reachable and connected. These parallel trends combine to mean that the large but yet small world has enough economic capacity and space for all good people to prosper and yet for all bad people to be stopped.

Basically, I am a technological capitalist. I believe in a change in emphasis from institutions to all individuals as described in the chart below.

The move along the political spectrum that we have already seen from communism to socialism and on to capitalism is a positive one. In fact, this spectrum is a continuum. Picture a circle that starts with communism and having turned full circle is completed with an end point called technological capitalism which ends where communism begins.

Socialism was a response to inequality, whereas capitalism can cause it. Under capitalism, new economic opportunities tend to present themselves to people who have already benefited from other opportunities. To be in a position to benefit from new opportunities under capitalism, individuals need to be a member of an institution such as a company. Acting alone they are likely to either face high entry barriers or be excluded from taking advantage of those market opportunities. The rich get richer and poor people stay poor.

One of the most frequent arguments against capitalism is that it leads to an elite of high-income earners, and an increased disparity in wealth between these people and the rest of the population. For example, the two of the largest and fastest growing countries in the world, China and India, "are seeing the emergence of a vast rootless, floating, marginal, urban population with an increasingly affluent, confident, cosmopolitan business and professional class." (WOLF, 29/05/95). Much of this income inequality results from the current high entry barriers to economic opportunities because of work benefits from organizations and mortgages for houses.

The enabling technologies help to neutralize this tendency. For example, the provision of infrastructure such as telecommunications to poorer areas does not detract from the usage of such services by richer people. Indeed, it increases the usefulness of such services by widening their service availability. If everyone has a telephone, the benefit of having a telephone is greater, because the possibility of contacting more people is greater.

Technological capitalism is similar to capitalism in that it emphasizes the existence of opportunities arising in free markets and the importance of individuals acting out of self-interest in the private sector. The invisible hand is still the only magic wand.

The move from socialism to capitalism has rightly shifted us away from organizing events using institutions towards using markets instead. But this transition has not yet gone far enough and moved onto technological capitalism. Too much economic activity is still dominated and dictated by large private and public sector institutions and not enough by individuals.

Because of the fundamental forces, under technological capitalism on the other hand, there are both the free market opportunities AND the opportunity for all individuals to benefit from those opportunities. Talent determines future wealth, not current wealth: poor people can become rich.

As technologies such as the Internet reduce the entry barriers to economic opportunities, the voluntary exchange principle stands, because honest individuals who have avoided ownership traps such as mortgages and membership traps such as organizational benefits, can walk out of their organizations (and nations) as and when they want to. We can turn our hobbies into businesses. We can then join another company, do temporary work, not work at all or form their own collapsible corporation. Other people’s organizations are no longer the only stage from which people can earn a living and prove their self-worth.

As such we have gone full circle, with technological capitalism actually the equivalent of communism for the unorganized world. Technological capitalism realizes in practice the equality of opportunity amongst individuals that was always the theoretical goal of communism whilst anchoring the achievement of such equality firmly within an economic system of very free markets. The full implementation of technological capitalism promises all the advantages of capitalism coupled with the communist ideal, without the disadvantages of either economic system.

And because communications technologies enable spontaneous, non-permanent collaboration, the traditional absolute choice between the individual and the group is gone forever. Individuals can remain autonomous and yet join with others as the need or opportunity arises. Independence will reign supreme, but honest individuals will be able to connect to both business partners and their family and friends using their technology tools.

Technology may give us the means to communicate but the willingness to cooperate will depend on what kind of person is asking (this is explained later in the "Ensuring individual accountability" section). And because individuals are social beings and need to be kind now to get help later, the unorganized world will be more integrated and friendly too. People will be outward looking, rather than hidden behind their employer’s organization (See "trans: shaping interactions in the unorganized world").

Lets now take a look at a very important factor for achieving success in the technological capitalist economic system of the unorganized world.

The importance of ideas

The unorganized world is an ideas economy. Given that production, communication and distribution choices are widespread and accessible, and markets contestable, it is the ideas being leveraged through these mechanisms that matter. Whether you are in a "service" or a "manufacturing" industry, ideas are what count. If you already own production facilities, then generate your own ideas or partner with others and produce their ideas. If you are not in the production industry, find a suitable partner and outsource production, rather than building your own factory.

For example, an advertising agency can try to offer its clients a one-stop shop with a global media-buying infrastructure. However, if the ideas that agency generates to leverage through that infrastructure are average, the effectiveness for the client of using that large, global agency is mute. On the other hand, a single person generating a good idea for an advertisement can make use of that media-buying infrastructure to distribute their ideas to the customers. This is the same model as that used in the biotechnology industry: small companies develop drug treatments and use existing pharmaceutical organizations to distribute and market their products. Novel ideas confer scale and influence, everything else can be outsourced.

In the organized world, the biggest challenge in business was finding out what opportunities existed and getting to participate in them- either through invitation or self-initiated, unsolicited approaches. This was more difficult than actually carrying out the business itself. The entry barriers to opportunities were high and access to them difficult.

As we have seen from the fundamental forces, in the unorganized world, anyone can get ahead, and the fact that you are ahead now does not in any way imply that you will remain ahead. Success depends upon the creation of ideas. All industries are contestable because all industries are based on competition between ideas.

Today's unorganized environment is a fantastic one full of unprecedented opportunity for anyone- whoever they may be and wherever they may have come from- anyone with ideas, ideas, ideas.

The myth of "increasing returns"

There is an alternative and opposing view of today's world called "increasing returns" which I want to now briefly refute. "Increasing returns are the tendency for that which is ahead to get further ahead, for that which loses advantage to lose further advantage... Increasing returns generate not equilibrium but instability: If a product or a company or a technology- one of the many competing in a market- gets ahead by chance or clever strategy, increasing returns can magnify this advantage, and the product or company can go on to lock in the market". (ARTHUR, 1996)

Increasing returns may exist for physical distribution products such as hardware and software standards for computers. Such standards were established in the organized world in the 1980s. This does not however mean to say that the model is useful or relevant in the unorganized world. I am quite certain that it is not important or relevant. In fact , diminishing returns are already tending to set in in these industries, with complicated and over-complicated software and microprocessor power desperately in search of applications that need it.

The same organizations that own the distribution standards have had little success in building compelling content that can be distributed using those standards. In fact, the common standards mean that anyone can use them to deliver the content and ideas that are the paramount wealth creators in the unorganized world.

The claim by many Internet commentators that increasing returns will play a significant role in the unorganized world is thus based on the misplaced and false assumption that just because it arose in organized distribution spaces, it will remain important in the unorganized content arena. In fact, the content industry will be driven primarily by ideas.

Seen from an unorganized perspective, the fundamental error in increasing returns is that it assumes that current positions based on past performance are important. In other words, organizations that can quickly develop products can build an unassailable market share and therefore preclude the successful entry of new challengers into that particular niche. Unorganization on the other hand says that markets are contestable- a single individual with a novel idea can partner and outsource sufficiently to form a collapsible corporation that can easily and profitably enter a contestable market. This transcends current configurations of power, market share and so on. As such individuals can enact their environment and create their own prosperity, if only they realized how much they could achieve. Whereas increasing returns sees the environment as important and unavoidable, unorganization sees it as something that can be transcended, enacted and contested.

Do not believe the myth of increasing returns- it is yet more outmoded thinking from people trying to protect their power bases by projecting irrelevant organized models onto a fundamentally different unorganized world.

We have now established the fundamental flaws that make political government dissatisfactory. We then identified the fundamental forces that facilitate alternative forms of economic government and we have outlined the design of the alternative political systems and economic systems that allow amplified individuals who think of themselves as brands to thrive. But we are "humanitarian libertarians" who care about all people. We have outlined the forces that free everyone to be all that they can be, but does not mean that it is not necessary to have back-up safety mechanisms for people who do not have the ideas and so on, and those who cannot continuously support themselves. There is a case for paying benefits as a safety net to individuals who face sudden, temporary unavoidable dependence.

The static systems of representative democracy and party politics that dominated the political arena in the organized world are fundamentally flawed as explained above. They will increasingly fail and people will be increasingly dissatisfied with them. These systems are living on borrowed time- perpetuated by a dependency culture, general non-understanding or interest in these issues amongst the population, and the legitimate coercion associated with political regimes which perpetuate themselves and finance their mistakes as no private sector company could, using taxation revenues.

This flawed political environment does not however mean that some of the aims of politics are without merit. I strongly dislike both organized business and organized political organizations. But I love business and enterprise, and I believe in equal opportunity for all people. Just as the failure of hierarchy to do the business does not mean that business is unnecessary, it is also true that just because political government fails to meet its social objectives does not mean that some of these objectives are not just. I will not abandon the people with genuine needs. Instead, I will design a system that liberates them to achieve their full potential, not support them if they are NOT inclined to be independent. I will thereby minimize the incidence and influence of the public sector in economies. I will use the dependency criteria to determine which government functions are useful and then suggest a dynamic unorganized way of ensuring those functions are adequately carried out. We need to minimize busyness and maximize business to carry out the political function, not eliminate it- but change the form that it takes and the means through which its useful ends are achieved.

Governments should go from political to economic. Whereas political governments were an active and major player in the economic, social and other activities, economic governments are a provider in the last resort of social and economic resources. Economic governments provide only safety net services when there is no incentive for any other group to rationally provide them- rational being an economic incentive.

Politicians cannot avoid the temptation to go beyond provision of the safety net and basic support services. They get involved in areas that can more fully and cheaply be provided by the private sector. Pensions, health and education can all be adequately supplied by free markets. All are important enough that people will devote time and spend money to make sure that these services are fully provided. Instead of paying taxes and then getting free education in return, people don’t pay those taxes and don’t get the free education. The same quantity of services can be carried out by the private sector for less cost and with better performance than the state because of the absence of the fundamental flaws and the harnessing of the fundamental forces.

For example, in the case of education, parents and pupils should have a large range of viable choices of schools that the children could attend to receive a solid and rigorous education. To ensure choice, there should be competition within the education system to ensure that the requisite incentives exist to stimulate excellent performance. We can, for example, imagine a competition spurring a wide range of choices in the education sector, ranging from distance learning, in-house teaching, nurseries, vocational, sports-centric schools and so on. Those schools of any type which underperform because of poor teachers or teaching methods won't attract pupils and must either improve their performance or close. Given the viable choices that competition brings, parents and pupils are not locked into poorly performing schools.

The free market is the dominant means through which the requirements of individuals are met. For example, there is rational incentive to ensure that education and health services are widely available and effective. Because this demand exists, entrepreneurs will have the incentive to supply solutions that meet it. The availability of these services is so central, essential and strategic to the well-being and ability of individuals that their guardians and parents will nearly always have the rational incentive to make such services available in sufficient quality and quantity to their dependents. Otherwise those dependents may end up being dependent on them forever- being unable to sustain an economic existence of their own accord acting independently. Hence, given the natural existence of the requisite incentives, the role of economic government is to ensure that ALL individuals have access to such services. In this way, dependents do not suffer from shortsightedness or false economy of their parents and guardians.

The dependency criteria

I have devised a "dependency criteria" to assess the need for and role of government in the unorganized world. The dependency criteria applies to all actions and policies from all people in groupings of any and every size in both the public and the private sector. It says that all actions should be taken with a view to reduce dependency and the affects of dependency and to encourage realization of the "good" status of voluntary independence. The things marked "BAD" in the Dependency Grid below should be eliminated and discouraged, the things marked "GOOD" should be facilitated and encouraged.

There is a common, but outmoded belief that "Dependence and independence are necessary phases that a [person] goes through in a maturing process. Both are simplifications of relationships that are useful until a person gains more experience and develops a deeper understanding of the world. A useful growth model, from Covey and others is dependence leads to independence leads to interdependence.

Each phase must be experienced to grow into the next level of maturity. Children start off being very dependent on their parents and other adults. This dependence is decreased as they grow. Teenagers start developing their independence to break out of the dependency model. Adults must develop an understanding of the true interdependency of people and their environment before they can cooperate in implementing decisions that are beneficial for- indeed, necessary for the long-term survival of- our societies and our world.

That many "adults" never reach the full interdependent maturity level is obvious from the decisions that are collectively made that lead to our downfall, whether it be a company, or a society or our world.

The major problem with the independent level is that those individuals do not recognize that they are part of a system and are constrained by that system. The growing movement of teaching systems thinking to our young people gives me some hope for the future that we will, by fostering more mature adults, move society out of its adolescent phase." (PATTERSON, Learning-Org List, 20OCT97).

I can see why the move beyond independence to an interdependent society might have been necessary in the organized world. As explained later, the requirement to participate in and comply with organized structures such as transportation systems and buildings caused many social problems such as gangs, queues, road rage, personal abuse, homelessness and racism. People, trapped within and subject to organized societal systems, often came across people in coerced, non-voluntary situations. In such a society, forced interdependence would be a positive thing- I would realize that that idiot trying to get me to drive faster is in fact a fellow human being and potential friend and team member of mine. Forced interdependence a la Covey at al is the search for solutions to organized society's problems.

In the organized world, dependence was unavoidable and most of the transactions arising between individuals and institutions were coerced. People had no choice but to pay taxes, go to an office or factory to work, be a citizen of a certain country, change their job (in Japan at least) and select their colleagues and fellow team members. In the organized world, the vast majority of people were told what to do and when and where to do it. People were dependent upon the institutions and structures of organized society. If they wanted something, they had to go somewhere to get it from someone. People were forced to do things like pay taxes even if they did not want to. Individuals navigated themselves around like lemmings. Such pursuits were undertaken out of all balance with the things that are important in our lives. In the organized world, managers exercised control and authority over subordinates who had to do what they were told. Subordinates were forced to be dependent upon their managers.

Coercion is never good: whether it be forced dependence, independence or interdependence. Even interactions between individuals can be uncomfortable and unwelcome if they are not based upon the voluntary exchange principle. There can be forced interventions between individuals; for example, when spouses henpeck, parents dictate or managers micro-manage.

Such coercion need no longer be tolerated in the unorganized world in which any brander who remains in a hierarchy is by definition not realizing their full potential. This is voluntary dependence. Any kind of dependence is expensive in terms of time, effort and energy wasted on busyness such as negotiating rather than the business of pursuing dream realization. Branders in hierarchies are engaging in transaction costs such as compromise and negotiation when they have the means to and could be engaging in transactions. Some, maybe a lot, of their time is busyness and not business. People used to have greater access to opportunities within organizations, but this is not a constraint in the unorganized world. Branders can only live their dream fully by being voluntarily independent or interdependent.

Voluntary independence is a valuable state of affairs for each and every individual. Voluntary independence is the ability to determine one's own destiny and who to approach to help live that dream. Voluntary independence is having viable exercisable choices. It is a low transaction cost status conferred by the fundamental forces that underpin the unorganized world. Individuals should seek to achieve voluntary independence, the legal system should protect people’s right to pursue it, and governments must not get in the way of it.

It is now possible for branders to be completely independent of coerced transactions. They can take their financial affairs off-shore, need not associate themselves formally with any organized institutions or static collective groupings and not only survive but (hopefully!) do well. If the value of their ideas exceeds the cost they charge for them, they can write their ideas down independently, publish them on the Internet from a server located in their home, and charge people using a micro commerce payment system. Their income would depend on the willingness of people to voluntarily purchase those ideas. Within technological capitalism, voluntary independence is realizable for any individual- gang member, team member or whoever. Technologies are rapidly falling in price and increasing in power, making them more widespread amongst the entire general public.

This book advocates not an absence of collaboration but the replacement of coerced collaborations with VOLUNTARY cooperation. It is not about growing our own vegetables, producing our own printer cartridges and so on. Purchasing decisions to buy or sell are voluntary transactions and therefore welcome. Competition from contestable markets ensures I have a choice of vendors for any purchases I need or want to make.

Whether I choose to go beyond voluntary independence to voluntary interdependence depends on what my dreams are. Voluntary interdependence arises when I choose to work with other people to help realize my dreams, within, for example, collapsible corporations and coalitions. But I cannot participate in implementing my ideas on a wide scale acting alone. I am dependent upon the voluntary cooperation of others for wide and deep reach. If I decide that idea generation and communication satisfies my ambitions, then voluntary independence suffices. If I want to participate in implementing my ideas widely, then voluntary interdependence is necessary.

Any reliance- voluntary or forced- on anyone else involves high levels of transaction costs. Decisions between voluntary independence and voluntary interdependence should be made on the basis of weighing the transaction costs against the transaction benefits (idea implementation, monetary reward) whilst minimizing the former through use for example of enabling technologies, and maximizing the benefit from the transaction.

Ensuring support for unfortunate individuals

Each individual should aim to be- and be able to achieve- all that they can be. In the unorganized world, the optimal achievement of such aims is perfectly possible in theory. The extent to which these aims are actually achieved in practice is up to the attitudes and actions of the individual. Do not make the mistake of thinking that you cannot do something in this openly accessible world. Contestable markets can be enacted. This is world where voluntary independence is highly achievable as people go from being rankers to branders via the development of lifestreams. (Rankers are rank conscious interchangeable employees whose working life is characterized by the efficient completion of routine tasks: See "Unorganization: The Individual Handbook" for details).

The fundamental forces in the unorganized world mean that each individual is able to take control of all of their transactions and avoid the tyrannies of time and place. They can work from home, with whom they want, when they want. As such, they can actively shape any transactions they participate in- they control their business and social transactions.

Of course, the traditional dependence of women on men has decreased too, given their ability to control birth and participate in work systems- even if when they first joined the formal workforce, those organizations were over-organized. Nowadays, women or men can telework from home.

I personally believe that every individual has the opportunity to achieve the status of voluntary independence. We are all knowledge workers. We can all create new ideas and insights. We all have different interests, hobbies and abilities that we can develop into lifestreams. Previously, people could not earn a living from their niche hobbies and interests because they faced high costs when transacting with the global audience that was necessary to allow them to earn a living from that activity. This is no longer the case. Given contestable markets, anyone- irrespective of the existing configurations of "power" and "influence"- can access economic opportunities and benefit from them.

Individuals must pursue voluntary independence and avoid any and all dependencies. They need alternative ways of earning a living, such that if they cannot or do not earn income in a particular industry or way, they can support themselves by some other legal means rather than accepting dependence and seeking recourse through the benefits system. This is a proactive process- thinking about and systematically developing viable alternative opportunities in parallel.

There is no reason why every individual cannot achieve something. There is no reason to think that the overwhelming majority of individuals cannot achieve sufficient independence to sustain their own existence. Each and every person has some talent or interest in something that is of use to someone else and this talent can through the fundamental forces be translated into wealth creation opportunities. And even those individuals who cannot create their own ideas will find roles helping others to implement their ideas and can accept forced dependence upon business organizations such as organizations. Forced dependence is wasteful, but it is the way that many people carved out a decent living for themselves and their families in the organized world. Some static organized organizations will remain in the future for those people who are not special enough to be branders. These organized organizations will make themselves special and create some excitement by partnering with branders.

The only constraints on individual success in the unorganized world are the ability to generate novel ideas and the positive, commercial attitude necessary to leverage those ideas.

In the unorganized world, individuals should overcome all forms of coercion and dependence, and therefore achieve independence. Old people may become more dependent on others over time, but they should nonetheless save when they are independent by having, for instance, private pensions.

Voluntary dependence is only forced upon anyone as absolutely a last resort. Rational individuals are only willing to operate within an environment suffering from the fundamental flaws if either there is absolutely no choice or for comfort. Individuals only accept dependence when lack the skill or will to enact their own destinies. If they lack the skill, then they are forced dependents, if they lack the will, they are voluntary dependents. People only have the incentive to avoid voluntary dependence if they are seeking personal fulfillment. Motivated people want to engage in transactions. Anyone with any ambition to achieve their full potential or at least pursue it would not formally associate with any organized political or economic organizations. They recognize how wasteful it is to spend life on busyness such as filling in welfare application forms and playing office politics.

The current benefits payment systems for unemployment and so on are flawed- they disincentivize working by making people think that earning their own living is either unnecessary or unwilling. These systems generate dependence, such that it is easier to give someone a benefit than take it away- benefit recipients get used to having that money and into the routine of collecting it, spending it, having interviews with employment advisors and so on. Both the tax and the benefits systems act as disincentives to obtaining employment because you receive welfare income when not working, and pay taxes when you are employed.

Any safety net systems that replace the welfare state for people to fall back on in times of difficulty or need should minimize the width and depth of the implied loss of independence and must not reward or tolerate persistent dependence. Benefits systems such as the welfare state should NOT pay benefits that allow or encourage voluntary dependence. Benefits should NOT make voluntary dependence an exercisable choice. The free rider option to spend life being other people's transaction costs and not generating any good transactions must not be an option.

Having looked at the implications of dependence and independence, let's now explore the possibility of and implications from eliminating transaction costs altogether.

Eliminating transaction costs to eliminate institutions

We saw earlier how falling transaction costs are one of the fundamental forces. Furthermore, if we can completely eliminate transaction costs, the costs of getting into a position to carry out activity, we can eliminate the requirement for formal means of enforcing contracts such as contract lawyers, legal institutions and so on. The economist RONALD COASE first explained this truth in 1960. In the same way as the reduced transaction costs means that the market can be used for dynamically carrying out business activity, rather than formal organizations, reduced transaction costs also facilitate use of market mechanisms to replace formal contracts.

Coase describes how in a world where there are no transaction costs at all, it is NOT necessary for formal institutions such as political governments or courts to intervene to correct non-criminal harm caused by people to other people. Instead, the parties causing and suffering that harm are able to and have reason and incentive to negotiate a fair and equitable outcome between themselves.

Coase explains that the transaction costs are incurred from the negotiation process between individuals that is often long drawn out, complicated and difficult to conclude. These transaction costs necessitate the existence of formal institutions such as courts to arbitrate and seek a fair settlement of the dispute. However, if the transaction costs can be eliminated, informal markets can replace formal institutions.

For example, imagine if you choose to build an office next to mine and the construction work causes noise that disturbs me and prevents me from working. Any other affected persons and myself could choose to seek to prevent or be compensated for the disturbance by seeking recourse in the law. Alternatively, the affected and affecting persons could correct the harm between themselves by voluntarily negotiating a mutually satisfactory settlement based either on reducing, eliminating or avoiding the cause of the harm, or compensating for the harm caused.

The harm is caused by forced interdependence, avoided by voluntary independence and corrected by voluntary interdependence.

The forced interdependence is caused by the fact that you and I are both deploying scarce resources to get into a position to transact. We are building the factories and offices to transact: the harm they cause is a transaction cost: a by-product of the intended transaction itself. We have seen earlier in this text how forced interdependence is a sub-optimal situation that is stacked full of transaction costs. There is no need for me to build a new factory because enough capacity exists somewhere in this global world that I can access through partnering and outsourcing.

All affected parties have something to gain from accepting voluntary interdependence and settling the dispute voluntarily. The office builder would have the economic incentive to pay the compensation sums if they were less than the additional costs that would have to be incurred to avoid or reduce the harm. To avoid the harm, the office builder could change the construction methods to reduce the disturbance caused by the noise, or build the office somewhere else. Both options would increase his or her costs. Alternatively the office builder could pay compensation to the adversely affected parties for the harm caused.

If the affected persons negotiate a settlement, then this can compensate them for the harm suffered and its consequences. People should not go uncompensated for abnormal suffering beyond the imperfections (such as background noise from traffic) generated by and routinely tolerated in organized societies. The compensation paid should bare a close relation to the cost of the lost benefits. The voluntary settlement would then leave the harmed persons no worse off. They get their income one way or another.

We can avoid suffering harm by being voluntarily independent. Knowledge work is location-independent anyway: I can think and write these thoughts anywhere. In fact, where I choose to write them is heavily affected by the existence of an environment that is conducive to my writing. As such, if someone starts building next to where I am working, I have the exercisable choice of going somewhere else.

Mobility is important for avoiding transaction costs, and exists in the unorganized world. This reduces the incidence of harmful conflicts in the first place: causers of the harm have the choice of using existing infrastructure and expertise already in place, and adversely affected persons can locate themselves out of harm's way. These exercisable choices confer voluntary independence.

When every individual has reached the state of voluntary independence, when they need NOT rely upon anyone else, transaction costs are eliminated. As such, in an unorganized world free of transaction costs, acceptable social norms arise from the self-interest of individuals without the requirement for formal institutions. Rather than relying on an intervention from an institution to correct the matter, an interaction between individuals suffices to equitably solve any problems that do arise.

Issues related to contract law can only be sorted out equitably through voluntary interactions if a mutual willingness exists between all involved parties to sort out a settlement between themselves. I believe that the non-institutional intervention means of delivering an equitable settlement can be applied to both non-physical contractual issues, and also to minor criminal matters that do NOT involve anything other than minor physical injury. For example, handbag snatchers may volunteer to voluntarily compensate their victims once they have been caught.

The same cannot be said for criminal matters where physical harm is forcibly caused. Criminal matters span, for example, murder, rape, road rage, kidnapping and hostage taking. In such cases, criminals are not going to volunteer to voluntarily negotiate a settlement with their victims. A criminal justice system is therefore necessary to deter and punish coercive or violent physical behavior.

The legal system

The legal system in the unorganized world should protect individuals from force and ensure the existence of viable choices.

The legal system must prevent one individual or group of individuals from negatively affecting other individuals or groups by forcing them to do things that go against their will. As such, the legal system should no longer continue to enforce and legitimize the force exerted on individuals by political governments implementing misguided policies and using coerced taxation proceeds to finance such follies. Instead of being a tool for legitimate coercion just like political government itself, the legal system should instead protect against force and be a vehicle for the maintenance of competition and viable choices that individuals can exercise.

The legal system should therefore, for example, maintain the intellectual property system such that no person or company can take and exploit the copyrighted, patented or otherwise protected ideas of anyone else without their express agreement and consent. In an economy based on ideas, it is clearly essential to have an intellectual property system that attributes ownership of ideas to their creators- in a fair manner that treats everyone- individual or large corporation (if any remain)- to the same high levels of protection of ownership of those ideas. Publishing on the Internet should, for example, be sufficient to generate copyright protection.

Ensuring individual accountability

Seeking redress through the legal system should be a last resort, just as seeking relief through the government benefits system should be a last resort. Both systems should however be in place as exercisable options for individuals to take. The existence of viable choices is as important as their use. Like contestable markets, the availability of exercisable alternative courses of actions alters the balance the power and generates greater willingness to agree to a voluntary settlement.

Just as before approaching economic government for benefit payments, individuals can take steps to leverage their assets to earn a living, there are also various measures that individuals can take to encourage a voluntary settlement before resorting to formal legal mechanisms. Such informal mechanisms include whistle blowing, shame, disclosure and Tit-for-Tat strategies, and will now be discussed. Individuals are no longer constrained by forced dependence to put up with dishonest individuals. They can exit and disclose, and without material disadvantage.

A world in which there are no constraints does not imply that there are no restraints. The fundamental forces in the unorganized world confer these restraints on independent individuals. There is a restraint upon intervening imposed by the diverse global nature of people and countries. There is a restraint upon intervening imposed by the ability for mistreated people to exit from organizations and other collective structures without suffering economic hardship. There is the restraint generated by contestable markets, which ensures that if existing power holders attempt to exercise or abuse their power, they will always provoke entry by new competitors. There is the restraint on individuals conferred by the necessity of having a non-threatening and non-extreme reputation if they are to be invited by other individuals to participate in collapsible corporations and coalitions.

The restraints are far greater in the unorganized world than they were in the organized one. It was the collectivist organized world that reduced individual accountability, by for example, allowing a lack of responsiveness or a problem to be blamed (sometimes rightly) on that person’s dependence on other people within an organization. People can no longer hide behind structures and institutional apparatus such as organization charts to justify infringing on other people's independence. At the same time, as we shall see later, the likelihood of a violent or anti-social event such as road rage is reduced in the unorganized world because the vast majority of people are no longer compelled to simultaneously share inadequate levels of resources such as roads and offices. Individuals exercise discretion over how and where they spend their time. People are liable for their actions to a greater extent than they have ever been. We are only ever one trade away from humility. Loyal customers and employees can exercise their ability and right to exit and never interact with us again, irrespective of past relations.

There is a useful tool called Tit-for-Tat that says that people should start out by expecting other individuals to treat them well. Be open-minded but skeptical towards people who approach you legitimately. After that, follow their actions. The more they do not treat you well, the more you can retaliate. Be as nice as you can be and as unnice as you have to be.

"There is a strategy for handling relationships... called Tit-for-Tat, or TFT for short, and is blindingly simple. It says that whatever game you are playing and whoever you are playing it with, you should play fair on the first move, and then do whatever the other guy did on the previous move. TFT has four distinctive qualities: it is "nice" (it is never the first to cheat, betray or otherwise violate the spirit of the game or relationship); it is retaliatory (it hits back as soon as the other player cheats); it is forgiving (it will be nice again as soon as the other player starts being nice, and it is clear (TFT’s simplicity makes it easily recognisable to other players). I believe that TFT can be applied to business relationships, too. Its niceness makes the company employing it attractive to deal with (for employees, customers, suppliers and allies); its provocability (the quality that causes it to retaliate instantly when cheated) deters cheaters; its willingness to forgive (and not over-punish) attracts reformed cheaters; and its clarity endows the organization employing it with a strong and coherent reputation." (LLOYD, 4/3/94).

In the unorganized world, interventionist people can no longer shut their office door and assume that what they say and do will go no further. Neither managers nor politicians can put "Private and Confidential" on an envelope and expect that communication to remain private. Leaks are unavoidable because other people are uncontrollable. Everyone affecting is accountable to everyone affected.

Technology is a tool that has the potential to be used for good or bad purposes. Whether technology applications have negative or positive affects very much depends on whether the individual the technology is reporting on is doing right or wrong. For example, close circuit cameras on street corners do capture evidence of vandals or other criminal activities on film. If on the other hand you are doing nothing wrong, then video camera surveillance is a positive deterrent against crime and those people who are misbehaving. And if you are falsely arrested by an official exercising their power or prejudice, you can use the video evidence to show that you have been falsely treated. The camera never lies.

Just as these days everyone can publish their positive work such as animated films and poems, anyone can also publish negative criticisms using the same media. They can blow the whistle by taking advantage of the low entry barriers to publishing conferred by the Internet. Where there was once a limit on distribution of output, now there is unlimited bandwidth accessible for the price of a telephone local call. Revenge is just a key stroke or button push away.

In the organized world, such disclosure was not possible because the top of the publishing hierarchy protected the top of the managerial hierarchy by not publishing "whistle blowing" books. These days, individuals can publish any information on the Internet without any entry barriers or technical difficulties. That really is the true joy of the Internet, it knows no hierarchy. "The network of networks is like a biological organism that is entirely self-replicating, self-sustaining and self-governing. No one plans the Internet; no one works to make sure it is properly staffed, managed, or budgeted". (BERNARD, 1996). This sounds like a good model for "collapsible corporations" to me, especially the self-governing bit!

In the unorganized world, arrogant people always end up killing themselves. This is because everything said in one media can be reproduced in another. Everything that first appears in narrowcast can be broadcast. In the unorganized world, everything negative can be turned into something positive by publishing it. Every threat that an individual faces from an institution can be turned against the person doing the threatening. Every threat is an opportunity. Consumers can vent their frustrations with organizations because every time producers or retailers make a mistake, every other consumer can be told. Voluntary entry and exit extends beyond employees to consumers. Consumer loyalty is as transitional as that of employees.

This will deter people in positions of power such as managers and politicians from arrogance. If another person suffers from your actions, then they can tell other people about it. Because electronic networks are replacing geographical communities, it is becoming ever easier to do business with decent people worldwide. Individuals can reach out and connect with whomsoever they choose despite any lack of geographical proximity.

Not only that, but as the world continues to change, the negative feeling felt by that person is unlikely to disappear. Arrogant managers soon find that there are a lot of people who will not have anything to do with them again. Relationships between people are essential in voluntary societies. Hence, negative behavior towards independent individuals is difficult to maintain over time.

Adam Smith, champion of free markets, described a very useful principle that ensures individual accountability. The so-called "impartial spectator" principle described by PROWSE "asks us to view ourselves not in the light in which our own selfish passions are apt to place us, but in the light in which any other citizen of the world would view us." Loving ourselves only as we love our neighbors is the essence of the 'laisser-faire' approach to government. "Suppose I am a trade unionist. An impartial spectator would disapprove of restricting access to their trade. They would have the same regard for the interests of new entrants as those of existing workers. [Similarly,] If I am an exporter, should I demand government subsidies to help me win business overseas? The [public] cost would inevitably have to be borne by other sectors of the economy: I would be loving myself more than others. Ditto for proponents of import controls. Smith's ethical views drove him to a free market position. He recognised that the cost of interventions by government to further the interests of one group of citizens would typically have to be paid for by other groups. The only doctrine an impartial spectator could countenance [support] would be what Smith called the "obvious and simple system of natural liberty": a regime in which no special privileges were extended to any group or individual... If man has a duty to care for himself, then surely he has a right to work where he wants, to negotiate contracts freely with employers, to save in whatever media he most favours, and to invest in whatever assets or markets he expects to generate the highest returns... In loving ourselves only as we love others (rather than vice versa), we are morally bound to reject government interventions and restrictions that favor ourselves over other citizens or groups. However, if everyone shows regard for the impartial spectator, "laisser-faire" policies become obligatory for society as a whole. Limited government is thus not only economically efficient but morally desirable. And the supposed conflict between markets and morals turns out to be an illusion." (PROWSE, 16/01/95). This is a description of voluntary independence.

Wealth creation not re-distribution

"Give someone a fish and help them for a day, teach someone how to fish and help them for a lifetime". These days, ideas and time are more important and scarce than money. Look at wealth creation initiatives from people such as Muhammad Yunus, founder of Graneen rural Bank with its microloans of amounts that appear small to us but are relatively large for the recipients or Anita Roddick of The Body Shop for helping at orphanages in Rumania. Selling a topical magazine called "The Big Issue" in the United Kingdom is another example of an idea which generates regular employment and income for homeless people whilst providing useful information to the magazine’s readers.

It is always tempting to spend money to get out of trouble- to see a problem such as poverty and establish aid. But it would be better to set up trade- sustainable ongoing mechanisms that facilitate independence rather than dependence. It is easy to get used to handouts, but they do not treat the cause of the problem, only its symptoms. Too often the cause lies in the inept and corrupt behavior of a few dictatorial politicians.

In the article "The Competitive Advantage of the Inner City" (PORTER, 1995), Michael Porter calls for the replacement of the traditional social model to deal with inner city problems such as crime and drug use with a new economic one. The economic model creates wealth as opposed to the social model that re-distributes it. The economic model is about generating profit in the private sector rather than requiring subsidy from the public sector.

The social model involves offering housing benefit and income support. "Strategizing institutions such as governments offer subsidies and community funds in a vain attempt to solve problems such as those of the inner city. Subsidies lead to subsistence. We must stop trying to cure the inner city’s problems by perpetually increasing social investment and hoping for economic activity to follow."

Instead, an economic program would be aimed directly at economic development in order to develop a self-sustainable economic base with employment opportunities and income earning possibilities. Economically viable companies are needed, bringing opportunities and jobs with them. Porter suggests that instead of corporate philanthropy and charity, companies should create business-to-business relations with inner city firms. "A sustainable economic base can be created in the inner city, but only as it has been created elsewhere: through private, for-profit initiatives and investment based on genuine competitive advantage- not through artificial inducements, charity or government mandates."

Porter believes that such a change in approach will not be easy given entrenched interests and outmoded organized attitudes such as those skeptical of business who persist in falsely viewing the private sector with suspicion. Rethinking the inner city in economic rather than social terms will threaten those currently involved in social causes such a local government officials.

Inner city businesses should be able to achieve economic viability- they have the advantages of being close to major transport routes and having large populations in their catchment area, generating local demand. The vast majority of people located in inner cities are willing and able to work.

Fortunately, as ever, the Internet provides a low entry barrier means to establish a web business by establishing an electronic community for say exchanging goods, partnering with other firms who want local content, and linking with other areas to generate wider information coverage. Web content could be used to generate positive non-web effects, and vice versa. There are plenty of opportunities on the Internet such as the current efforts to establish local search engines. Not only could these be set up by people in the inner city but also used by them to list and advertise local businesses. As we will describe in the case of gangs later, the low entry barriers to the Internet are such that web sites can be set up by everyone including disadvantaged groups.

Wealth creation, not re-distribution, sustainability not subsidy is the way of the unorganized world. It's about solving your own problems rather than relying on others to solve them for you. It may be nice to know that socialists are willing to solve your problems for you, but they cannot.

From enforcers to entrepreneurs

The big problem with having any government sector at all is that you need enforcers such as tax inspectors and regulation such as VAT registration. Organized society is made up of far too many "enforcers" and not enough "entrepreneurs". Social models advocate non self-sustaining subsidies rather than the creation of genuine economic opportunities, despite the fact that the future will be more about creating wealth than redistributing it. Enforcers include "The social worker, the traffic warden, the ubiquitous ‘counselor’, the hygiene policeman, the health warning, the fluoridation of water, the sex education booklet, the helmet laws, anal dilatation technique [whatever that is!], Satanic abuse and the motorway camera are all characteristic inventions of the liberal [representative] democratic state." (DUNCAN AND HOBSON, 1995).

We need to move to an unorganized society in which ALL working individuals add value, and not a society in which a large percentage of people earn their living by taking value often by force from those people who do create value. I am thinking of people such as tax inspectors, revenue protection staff, accountants and debt collectors.

Rupert Murdoch, the media entrepreneur, has argued persuasively against "neosocialism". The enforcers are the main drivers of "neosocialism": today's higher level of regulation on business and social issues. Socialism in the sense of public ownership is dead, but has been reinvented through regulatory controls under the guise of equity or safety. The neosocialist nannies are those that live off the government and business such as career politicians, political spin doctors and policy advisors, government bureaucrats, and trial lawyers. Groups of people such as teachers are neosocialists because they are in the business of extracting tax money from the rest of us. Murdoch rightly describes the European Union as a prime example of a neosocialist supra-national bureaucracy dictating detailed regulations and directives.

Murdoch rightly says "It is the self-interest of this bureaucratic class that drives neosocialism. These are the people who benefit from proliferating regulations because they administer them. They want to see the nanny state, because they are the nannies. They want to see "politics in command," because they are the commanders- elected and unelected." (MURDOCH, 1997).

Too often, government plays the role of nanny, thereby restricting and eliminating viable choices that people can make. For example, banning the sale of beef on the bone outright because of some minor health risk. Instead, the public should be given the information that is available about such risks such that they can make their own decisions about whether or not to buy or continue buying those "risky" products. A principle feature of the nanny state is governments wrongly assuming that they know people’s preferences better than the people themselves.

We should move from enforcers to entrepreneurs and from nanny socialism to technological capitalism.

Financing economic government

In the unorganized world, individuals will thrive because of the fundamental forces and political governments and other institutions will decline because of the fundamental flaws. Political governments will become an ever greater burden upon individuals. They will take more of our earnings by force and give less and less benefit to ourselves or others in return.

Fortunately, technologies are making it easier for individuals to circumvent political government controls such as currency and taxation regulations. The same technologies that facilitate technological capitalism also allow the circumvention of political governments. The free-wheeling and self-governing nature of the Internet is the cornerstone underpinning the independence of individuals from anyone else exerting force over them.

We can transact over the Internet in electronic currencies that are not issued by national central banks and cannot by controlled by political government tax collectors. Making purchases, paying bills, trading shares, getting loans are all increasingly carried out by electronic means such as over the Internet. These transactions use strong encryption to ensure privacy of communication. The encrypted communication passing across the Internet for the purchase and sale of financial products such as mutual funds and equities is being expanded to off-shore banking. As this becomes cheaper and easier to arrange electronically, the entry barriers in terms of the amount of wealth needed to quality for tax-free havens will continue falling to levels that "typical" people can reach.

Because these payment mechanisms are electronic, we can overcome the bounded rationality of humans trying to do the same job and create an efficient market in which people buy, sell and get paid for goods and services electronically. This means that we have the invisible hand efficiently allocating resources globally. Basically, a market, be it electronic or physical, is an information clearing house.

The impermanent, voluntary organizational forms of collapsible corporations are set up through on-line communication between people in networks or databases. These could be seen as facilitating tax avoidance and evasion because people collaborate, deliver, take their profits and disband, with the money disappearing into cyberspace bank accounts, untraceable and untouchable by political governments. This breaks the traditional implicit employer-state cooperation where government automatically deducts income taxes from the employee’s wage packet, before that money even reaches the employee’s bank account or pocket.

Obviously, political governments finance their mistakes and perpetuate themselves by forcing people to pay taxation that they then waste. But there is a legal way of both avoiding and evading taxation- taking your income off-shore to tax havens. This typically but not necessarily entails becoming a citizen of another nation. But to the extent that nationality is irrelevant, then changing nationality and relocating is an acceptable and palatable step. We can work from wherever we are, irrespective of our geographical location without suffering from information or cost disadvantages (the Internet enables this).

As the middle-classes around the world grow more and more disillusioned and angry with political governments, they will increasingly choose to hide more and more of their savings and investments from state tax collectors. This is a morally justifiable act- when something does not work satisfactorily and delivers the required levels of service, only exit from those arrangements can hasten any voluntary- but limited- reduction in power from the politicians themselves. Most people who opt-out of contributing to political governments will then accept a voluntary moral abstinence from using the services that their tax contributions previously entitled them to. They are not willing to free-ride on the achievements and efforts of others to gain personal benefit. They will have private health-care and other services.

The central question will be the extent to which individuals can capture the full income they earn from their value adding activities, and the lengths political governments will go to coerce individuals into paying tax. This in turn depends on the freedom of individuals to relocate into tax havens and countries with low political government intervention and involvement.

So independent people can circumvent forced payments, but we still need to finance the safety net systems provided to genuinely needy people. Instead of the existing organized methods for collecting revenues, which are based on coercion, I propose different kinds of income generation mechanisms that collect the requisite amount needed to finance the last resort functions of a minimized economic government.

These mechanisms are:

1. People will provide for themselves privately by saving in times of plenty in order to spend in times of poor, taking out insurance to compensate for loss of work and supporting and being supported by their family, where economic concerns are not the primary concern. This allows the retention of independence even if economic circumstances worsen.

2. Voluntary mechanisms such as registered charities, for example, supermarkets nominating a charity of the year, affinity credit cards where consumption spending automatically generates a proportion of income to charities, playing lotteries with contributions to good causes, making donations to charity and so on. Charity is a voluntary act. Whilst voluntary systems are desirable, they retain disadvantages such as the uneven burden between people.

3. People will undertake services in return for deferred payment for help rendered. This is the Silicon Valley venture capital model where technology, legal, property and banking services are made available free during start-up in return for returns when and if that company later raises capital on a stock exchange. Up-front connection fees will go, with charges usage-based or free of charge but financed by advertising. In this way, someone with an idea can access the (because of partnering, outsourcing and the Internet) low level of resources needed to communicate and develop that idea, before paying back any up-front investment from the returns generated by that idea.

4. Indirect taxation. I am an advocate of high levels of indirect taxes being levied on goods and services that are unnecessary, wasteful, addictive or harmful in the unorganized world such as:

designer clothing: unnecessary and wasteful expenditure. 75% of the purchase price pays for the little (or large) label on the breast

automobiles: Cars are not as important in the unorganized world where work is carried out primarily from home

antiques: Unnecessary. The vast majority of relatively less well-off households have few if any antiques.

perfumes: Unnecessary. Toilet water packaged in fancy bottles that makes people smell, often strongly

cosmetics: Often unnecessary and ineffective

sports equipment: The more elite the sport, the more equipment is needed. Sports such as soccer which do NOT require much equipment would be less affected by high sales taxes than the fancy sports such as skiing and golf

cigarettes: Harmful both to self and to others. Disease-inducing. Foul, disgusting and smelly. It is not for taxpayers to pay for such self-inflicted harm through public health systems

alcohol: Turns idiots into dangerous idiots. Increases the incidence of forced or uncontrolled behavior

Non-renewable fuels such as coal and petrol. Polluting and scarce

home furnishings: the only property worth owning in the unorganized world is intellectual property. Focus and effort expended on physical property and do-it-yourself household goods is busyness and not business

(These lifestyles choices are explained in detail in "Unorganization: The Lifestyle Handbook" on unorgan.com).

Unfortunately, whilst people are not forced to buy goods, and can therefore avoid sales taxes, they have no choice as to whether to pay sales tax on those goods.

Having taxes which are indirect and based on consumption is exactly in keeping with my belief that the modern consumerist society is wasting a lot of economic and environmental resources on unneeded and unnecessary purchases. Credit and debt, which reduces mobility, often finance such purchases and stifles true independence. People are dependent upon others to earn the money they have to have to pay for consumer goods. These goods may outwardly be symbols of independence such as mort-gages and car loans, but they are actually creators of dependence. Possessions reduce freedom because such property has to be paid for.

Summary- The end of the hierarchy of collectivism

This book has explored in detail the need to change the nature and form of the political and legal systems in the twenty-first century. The social, political and legal consequences of increasing unorganization are disintegration in all collectivist structures and the consequent rise of the individual. Collectivism is the necessity of working together within static structures such as organizations to get something done well. The more unorganized the world gets, the less any collectivist structures can work and survive. We need teamwork, but we do not need teams. We need a social safety net, but we do not need political government. We do business, but not within traditional organizations. Increasingly in the unorganized world, we need to replace more and more static entities with more and more dynamic ones, and supplant our forced interventions within institutions with more and more voluntary interactions between individuals.

The Hierarchy of Collectivism

Individuals

Marriages

Families

Teams

Committees and boards

Organizations

Political Parties

Trade Unions

Communities

Nation states

Socialism

Communism

If you look at The Hierarchy of Collectivism, you can see that the most collectivist structures in society are already increasingly under threat. And as the unorganized world integrates and changes at an increasingly fast pace, more and more of these collectivist structures are being destroyed and are killing themselves by their failure to justify their existence. We have seen how the fundamental flaws mean that these organized systems no longer work satisfactorily, and how the fundamental forces have facilitated new and better alternatives. We have seen the destruction of communism, the increasing failure of socialism, a reduction in the importance of communities and falling membership of trade unions. Political parties are failing to achieve cost effective positive change. Business organizations are downsizing, restructuring and downstructuring. Teams are more trouble than they are worth. Half of all marriages in more developed countries break down.

And what is left at the end of collectivism is the individual. What we are seeing is that increasingly the individual alone and more importantly acting in concert with, but informally and impermenantly with other individuals, is increasingly the optimal unit of social, economic and political power and efficiency. Hence, one won.

Francis FUKUYAMA was right in The End of History and the Last Man when he said that he "did not believe that the historical process would continue indefinitely, but would come to an end with the achievement of free societies in the real world. There would in other words be an end of history. This did not mean that there would be an end to events arising out of births, deaths, and social interactions of humankind, or that there would be a capacity on factual knowledge about the world... What he was saying was that the principles of liberty and equality underlying the modern liberal state had been discovered and implemented in the most advanced countries". (FUKUYAMA, The End of History and the Last Man, 1992). We must introduce the principles of liberty and equality of opportunity into our corporations. We know what we have to do and the tools are there to do it. Let us get on out there, change our attitudes and become branders in unorganized companies and realize technological capitalism, unleashing the full potential of all individuals and the growth of the economy.

Feedback

Feel free to email Simon Buckingham, the author of this book at simon@unorgan.com with comments and queries. Every week new articles about "unorganization" are published on the www.unorgan.com Internet site, which already contains a great deal of additional relevant information.

I would like to thank Robert Klassen in California who was a particularly frequently correspondent about this book. I also owe him for the label economic government to replace political government. Whilst he is sympathetic with the content and approach advocated in this book, the humanitarian-libertarian approach I have striven for is not completely conversant with his beliefs and instincts. Such a divergence of opinion between every individual is of course both wholly understandable, and incorporated into this book!

I would also like to thank the staff at the Department of Commerce at the University of Birmingham in England for introducing me to all of the fundamental forces in the unorganized world as part of my BCom Commerce degree there.

I would also like to indirectly thank the Labour Party in Britain. When that scum was voted into political government in the UK in mid-1997, it generated a great incentive in me to explore how such a group of idiots could ever be "democratically" voted into power in a supposedly civilized society.

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