Using Electricity for Money

(A Work in Progress)

You go to the supermarket.  You pay the checkout girl with little slips of paper that say dollars.  Suppose you paid her with little slips of paper that said kilowatts instead, would it matter?  Would you care?  Would she?  The prices would would have to be adjusted roughly 15 to 1, but other than that, if everything everywhere was bought and sold in kilowatts instead of dollars, would anyone care?

Each of these little slips of paper is actually a bearer certificate redeemable for a kilowatt of electricity on the stated redemption date.  Or it can be redeemed beforehand by using it to pay your electric bill.  A kilowatt for a kilowatt.  You're giving over mere paper but getting real electricity in return.  That's where the rubber meets the road, when people pay their electric bill and see that the paper kilowatts buy real electricity, as the system promised.  The electric company in turn produces a kilowatt at a cost of less than a kilowatt and the difference is their profit.  The banks, as always, take in deposits and lend out loans, only in kilowatts.

Anyone who can produce a kilowatt at a cost of less than a kilowatt can go into business creating money, legitimately.  If a guy lives on the side of a mountain and has a stream running through his backyard, he can build a small hydroelectric plant and use its output to cut his own electric bill.  If the output is beyond what his household needs, the surplus goes into the local grid and gets credited to his bank account.  If it’s a big enough turbine he can retire.  

The great difference between a dollar and a kilowatt is that the kilowatt’s value is constant and eternal, like gold.   A kilowatt of electricity is a kilowatt of electricity, and will always be a kilowatt of electricity, just as an ounce of gold is an ounce of gold, and will always be an ounce of gold. No matter who’s in power, no matter who wins the war, no matter who loses the war, an ounce of gold will always be an ounce of gold.  The same with the kilowatt.  It’s value is beyond the power of politicians to alter.  God, not man, made electricity, just as God, not man, made gold.  Forty billion years from now when the last of the stars is burning out a kilowatt of electricity will still be a kilowatt of electricity.  Political corruption can no more change the nature of a kilowatt of electricity than it can change the nature of an ounce of gold.

Could we then use electricity as an incorruptible medium of exchange, a new kind of money as far outside political tampering as gold?  And who would issue these little slips of paper that say kilowatts?

The grid itself.  Today the grid is strictly a private affair between electric power companies for moving electricity around.  Many people have never even heard of it.  But if we started using electricity for money the grid would become the reckoner of everyone’s kilowatt balance.   Moreover it would become the de facto guarantor of the currency, the institution everyone would trust to turn the little slips of paper into actual electricity as needed, and guarantee their worth.

This means creating a Grid with an upper-case G, an actual Institution where sober, responsible people in business suits (hopefully electric power engineers, not politicians) meet regularly to decide how much electricity each of the world’s electric power producers can honestly be relied on to deliver.  That amount can be stretched as far out into the future as desired, just so it remains credible.  For maximum credibility the Grid could even build its own portable, high-survivability power plants on barges to supplement the electric companies.  If all went well they would sit idle or run at a mere 5-10% of capacity.  But in a crisis they could be dialed up.  The paper would always be redeemable no matter who’s bombing whom.

Using electricity for money solves the problem that gold and silver always had when mankind tried using them for money, namely, that the overall volume available was so minute that there wasn’t enough to fill the world’s wallets, purses and cash registers.  Commerce and prosperity choked because of this.  Wars broke out because of it.  Paper kilowatts, by contrast, can be issued in adequate supply to fill every wallet, purse and cash register on the planet.

But how do the kilowatts first enter circulation?  

There are any number of superb answers to that question but they all begin with getting the world’s vendors to agree to price their goods and services in kilowatts, in addition to whatever other currencies they choose to honor.  If they have no confidence in kilowatt paper and don’t want to be bothered with it, then they can set their kilowatts prices very high so no one with kilowatts to trade will come to them.  But they must set some kind of price in kilowatts, however high.  They can’t decline to post a price in kilowatts or the system fails.

That much done, how do the kilowatts first enter circulation?     

1.  One very considerate idea would be for The Grid to purchase the US Federal Government’s Food Stamps program (paying for it in kilowatts) and extend it to a global program.  The world’s grocers would quickly see the profit in trading in kilowatts and human hunger would be at an end forever.  

One of the peculiarities of world hunger is that you can travel to the worst famine zone on earth and the local Hilton will still serve you a seven-course dinner in their penthouse restaurant, complete with a linen tablecloth and a uniformed waiter who bows.  You can sit there by the railing looking out over the countryside and watch as the death cart gathers up the corpses of the starvation casualties from alongside the road while you munch on your rib eye and fresh garden vegetables.  The world really is this insane.  People don’t starve for lack of food, they starve for lack of money to pay for food.  If you’ve got the money to pay for it you can travel to the worst famine zone on earth and buy all the food your belly can hold, and even feed half of it to your dog.  

If The Grid bought the American Food Stamps program and made it worldwide then the kilowatts would enter the world economy through its groceries.  The grocers would in turn pass the kilowatts along to food distributors, who in turn would pass them along to farmers, etc., etc., until they reached every part of the world economy.  

Is food a right or a privilege?  Does every child of the Earth Mother have a right to a fair share of the Earth Mother’s bounty, or only the ones with money?

2.  Another way to introduce the kilowatts into the world economy would be to pay the cost of irrigating the world’s dry but fertile lands, to increase earth’s grain production to the max.  The kilowatts would first enter as wages for hardhats and revenue for pipeline manufacturers, but again, these would pass the kilowatts along to others, who would pass them along to others, and again, they would reach every part of the world economy.  This could be done in conjunction with a universal food stamps program.  It’s not at all an either-or.  

3.  Another possibility is the Roman Formula.  Rome didn’t become rich until they built the roads.  Prior to building the roads they were a bunch of farmers.  As soon as they built the roads they became rich beyond anything the early republic ever imagined.  

What if The Grid used its kilowatts to purchase the whole of the world’s railbed and operate it as a toll road, open to all mankind equally?  Any entrepreneur in any country would be free to lease locomotives and equipment, hire his own engineers and haul freight as the market demanded.  The railroad companies currently owning the different sections of the railbed would be paid in kilowatts, plus they’d be free to operate their locomotive and freight cars on the newly-created toll road the same as anybody else.  If anything it would be a blessing for them because it would deliver them from the expense of track and railbed maintenance.  The Grid would pay for that from now.  

It worked for Rome.  Would it work for the 21st Century?

For real pizzazz, The Grid should electrify the railbed with free electricity.  The locomotives would draw on it as needed.  Transportation costs would no longer include any expense for energy.  The energy would be free, provided compliments of The Grid, for the sake of stimulating the world economy (which it no doubt would).

4.  The Ocean Sabbatical is an idea whose time has come.  For seven years the human race leaves the fish alone.  Swimmers can still swim and sailors can still sail but the present overfishing ends for seven years so the ocean can rest and the scientists can observe the result.  The fishermen and related industries who would be forced out of business by this get compensated in kilowatts.  They pay their staff and maintain their equipment, but do something else with their time for seven years.  Because fishing is a global industry the kilowatts quickly find their way into the global economy.  

5.  The Spaceway has gotten a lot of press in Japan recently but in the west the media has imposed a blackout for some reason.  It’s a highway into space, and the engineers say it’s possible.  It would cut space transportation costs by 90% right off the top and make also solar dumping of toxic and irreducible wastes feasible.

The idea of the Spaceway goes all the way back to Tsiolovsky and Goddard.  Imagine if you attached a long, long, long cable to the earth’s equator and let centrifugal force hold it out in space, stable.  Everybody knows you can fill a bucket with water, tie a rope to the handle and spin it around until the bucket becomes horizontal, yet the water doesn’t spill out as long as the spin continues.  That’s centrifugal force.  

The same equations say a cable attached to the earth at the equator with its center of gravity at geosynchronous orbit and its outer half trying to fly off into space, could be made to balance exactly.  The bottom half would be forever trying to fall to earth.  The result would be a stable construction.

Now imagine a cable wide enough to mount a pair of rail lines and you can take a pressurized train into space.  Way cheaper than any space shuttle.  One side going up, one side going down.  All aboard!

The Japanese version envisions a ribbon instead of a cable, to minimize the damage caused by the inevitable collision with a meteor or space junk, but conceptually, it’s still a vehicle of some kind traveling along a highway of some kind, held out from the earth by centrifugal force.   

Every nation (and any coalition of nations) capable of aerospace engineering could build its own version of the Spaceway, and have The Grid pay for it in kilowatts.  Here the kilowatts enter the global economy through the aerospace sector, but they quickly travel to every other part.  

The completion of a single Spaceway would open the door to the construction of low-cost solar power satellites which could gather pollution-free electricity in limitless supply.

To be continued.

[The Astronaut Service.  The rebirth of great ships and long voyages.  Mineral value of the moon, asteroid belt and Martian moons.  Implications of gold on Mercury.  Solar dumping of toxic & irreducible waste.]