L7 Enterprise Schema

Tools For A New Political Economy

A New Enterprise Schema - Including a Universal Social Backbone

In order for a new values hierarchy to take shape in a Level 7 political economy, we need to create a different structure of enterprise configurations and interactions. Here are some of the elements I have proposed (from Escaping the Failures of Capitalism, Political Economy and the Unitive Principle, The Goldilocks Zone of Integral Liberty, and Reframing Profit):

Categories and Tiers of Enterprise

I would advocate for two categories of enterprise, each with multiple tiers. On the one hand, there would be a category of non-profit producers and service providers that compete with each other to provide all the features of the “Universal Social Backbone.” Due to necessities of physical-layer standardization (mass transit, for example), some would be larger, with less competition. Others could be smaller, community-level entities networked together (such as credit unions), with more diversity of competing services. This idea was inspired in part by non-profit health insurers in Switzerland who compete with each other for healthcare customers.

For a second major category, there would be for-profit enterprise participating in a more traditional exchange economy for goods and services above and beyond the Universal Social Backbone. This second category would also have multiple tiers. At the top would be certain major industries, especially those that a) have essentially become closed to rapid or major innovation, b) are de facto market monopolies, or c) otherwise dictate economies of scale with highly centralized controls. These would become worker-owned cooperatives subject to governmental oversight, with the level of government responsible for oversight always larger than the size and reach of the business itself. These would be much like the Universal Social Backbone category of non-profit enterprise, but in this case for-profit. There is no reason why this tier couldn't also compete with cooperatives in the first Backbone category, wherever that makes sense.

The next tier in the for-profit category would be networks of worker-owned cooperatives where both specialization and standardization have already narrowed the playing field (computing and communications, for example), but where monopolization of any one brand could still be capped at 25%. In this second tier, businesses could model flexible manufacturing networks in terms of distributed production and coordination.

Lastly, in a third tier of enterprise in the for-profit category, would be sole proprietorships or very small businesses - perhaps five people or less - that could, at least initially, follow the more traditional model of private ownership.

For all of these categories and tiers, the people will have a voice and regulatory influence via direct democracy, citizens councils, community NGOs and CDCs, and
elected technocrats. The objective will be to subjugate business activities to civil society, rather than inverting that relationship as it is today. Instead of managing business-consumer relationships either punitively, through the court system, or via heavy-handed regulation by the State, community-level civic institutions will become the central mechanisms of oversight. In addition, the atomistic illusion of “the empowered individual consumer,” who is just being exploited through their isolation and dependency on purchasing substitutions for well-being, will be shattered by direct civic participation, and by attenuation of the profit-motive through worker-ownership, non-profit culture, and the cultural and economic reframing of profit itself.

Over time, as fiat currency, banking systems and perhaps even the exchange economy itself are replaced with more egalitarian, horizontally collectivist, distributed and participatory mechanisms, then “for-profit” and “non-profit” designations will likely evaporate, and most production and services - even those within the Universal Social Backbone - could become even more distributed. Economies could then be negotiated and coordinated entirely through Open Source manifestations of direct democracy, with the means of production shifting back to communities and people’s homes through advanced automation. For example, 3D printers could become ubiquitous for local and remote fabrication, as would Internet-based virtual offices and services, with AI-controlled networks of driverless vehicles providing physical distribution where necessary. Even the concepts of “worker-ownership” and ownership shares in communal resources or enterprises could dissipate, migrating through phases of social credit accounting into an as-yet-unconceived gift economy. As a helpful exercise, we can imagine various configurations and innovations to enable this transition, but the reality will need to respond to evolving conditions in rhizomatic ways.


Initially, however, the two proposed layers of major enterprise could encompass a majority of business entities – though clearly flexibility should be given to very small businesses, and perhaps even to a limited number of industry-disruptive innovators and outliers who feel (correctly or incorrectly) that collective decision-making will inhibit their unique creativity, work styles and tastes. Remembering Ostrom’s observations, we should expect adjustment to unique variables and local conditions for any proposals. At the same time, we can be fairly confident that other approaches to reforming shareholder-centric enterprises, such as benefit corporations or B Lab certified corporations, will ultimately fall short of adequately moderating the corrosive ethos of hierarchical property ownership – the problems are too endemic. As I write in Political Economy and the Unitive Principle:

“There have been proposals to remold U.S.-style capitalism into a more just and compassionate system. Efforts like "conscious capitalism" and its offspring, B Corporations, are the latest incarnation of an enduring American optimism that corporate culture can be changed for the better. In a similar vein, "natural capitalism" attempts to introduce true-cost accounting for natural resources, thereby recognizing externalities usually ignored by free markets, with the hope of lessening both waste and negative impacts on those resources. And of course there are an endless series of management training and organizational development consultants who will help re-brand a company into a worker-friendly, environmentally conscious, civically constructive enterprise. None of these efforts, however, have changed the market-centric assignments of property ownership in the U.S. system.”

Intellectual property would follow a similar path to collective ownership as we inevitably move towards an Open Source orientation, achieving maximum knowledge diffusion, contribution and collaboration. Remember that, for those whose level of moral maturity requires personal benefit to incentivize innovation, socially productive efforts are still rewarded via the social credits system. But there would be no longer be the massive concentrations of wealth resulting from exclusive ownership by individuals or organizations, so that patents, trademarks and copyrights would tend to be collectively held and have relatively brief legal durations – perhaps ten years at most.

What Should be Included in Infrastructure and Essential Services?

These are the fundamental products, institutions and services necessary for any sort of complex society to function at the most basic levels, and which have already tended to be socialized in most mixed-economies. Roads, bridges, water, electricity and communication are the first tier of this category, followed by more abstracted products and services that build on those foundations, but are still perceived as universal expectations by the general public. This second tier is comprised of the systems and institutions that provide the backbone of civil society. For example, public transportation, public healthcare, public education, public safety services, social security, and so on. As expectations differ from one zeitgeist to the next, so would the scope of inclusion in these tiers. I happen to think basic banking and insurance services, basic nutrition, basic housing, mail delivery, fundamental scientific research, worker retraining, employment placement services, and unemployment benefits also fall under "infrastructure and essential services." To summarize, I would include:

Ubiquitous Technology: Pervasive Internet communication technology and access equality; renewable energy production that is highly distributed and available to all; variations of equally available personal communications technology based on universally implemented standards.

End-to-End Mass Transit: So that regular schedules of bus, trolley, train and plane can seamlessly transport people from within a mile of their homes to within a mile of any other urban or suburban destination on the planet at a relatively low cost.

Open Mediasphere: All media and communications platforms, technologies, frequencies, channels and bandwidths are available to all contributors, and accessible by all consumers.

Equitable Legal Systems & Services: Public funding of all lawyers and legal services; qualified judges appointed to limited terms by lottery and subject to recall votes; juries selected by lottery; adoption of Dworkin’s “Law as Integrity” or other consistency standard.

Protected Nutrition: Guaranteed availability of low-cost basic nutrition; a robust and sustainable food supply (organic, genetically diverse, non-engineered); a move away from large, centralized production to more distributed, local production.

Universal Public Education: For all levels of education, in all disciplines, provided equally to all applicants.

Universal Wellness Services: For healing, health, well-being and self-care training and resources in all dimensions, and inclusive of encouraging moral development.

Universal Employment Training & Job Placement

Universal Non-Profit Unemployment, Disability & Retirement Insurance

Public Health & Safety Services: Well-provisioned and staffed fire, police, ambulance, rescue, disaster mitigation, consumer protection, etc.

Public Housing: Temporary public housing when pursing education, transitioning between jobs or regions, engaging in retraining, holding public office, or during periods of disability, recovery or medical treatment.

Public Monetary System & Macroeconomic Stability: Monetary system migrated to Level 7 (see common property shares), perhaps using a “Chicago Plan” styled interim system for transition.

Fundamental Scientific Research

Non-Profit Member-Owned Banking: No more privately owned banks; no more privatize profits with socialized risks; no more high-risk speculative instruments.

Public Mail Service

Reintegration Rehabilitation & Training for All Non-Violent Criminals

One common thread of these public domain industries, however, is that they facilitate trade for the second category of labor. This is a crucial point: without centrally coordinated infrastructure and essential services, there really is no way to enable a reliable (or equitable) exchange economy of any kind. Also, to whatever degree possible, all of this should be organized and tactically managed at the community level, with centralized standardization and support, subject to direct democratic control. Instead of centrally run state institutions or corporations, there would be networked, non-profit, worker-owned cooperatives that are centrally regulated but monitored, but administered with a substantial degree of autonomy at the community level. It might also be interesting for different regions to compete with each other for customer satisfaction, and be rewarded in some way for their success. If the service or product being delivered provides the most fundamental level of infrastructure or essential services, there wouldn't be competition for customers between the cooperatives, but the cooperatives would be limited in size (by service area, etc.), and subject to public input and scrutiny to ensure an adequate level of service delivery. If the service or product is not part of infrastructure or essential services, then the non-profit cooperatives could compete with each other for the same customers across different regions. So although there is a strong element of central planning here, the actual control and execution is highly segmented and distributed, both because of the divisions of government already alluded to, and the emphasis on community-level organization.

There should be some mechanism to ensure the Universal Social Backbone doesn't somehow undermine individual contribution to society by inoculating the least morally developed against survival or well-being concerns. That is, there would be some form of citizen reciprocation for this foundation, and consequences for a lack of reciprocation. So, for instance, everyone who receives benefits could participate in these very same programs as unpaid volunteers for short but regular periods of time, with consistent expectations of performance. If someone chooses not to volunteer, or willfully demonstrates exceedingly poor performance, their access to some or all of these services (or perhaps certain qualities of service) could be restricted. This consideration of reciprocity is the basis for the Level 7
social credits system.

Another way to approach a definition of infrastructure and essential services would be to examine those civic functions that ensure the following freedoms, specifically with the aim of eradicating all
forms of poverty:
  • Freedom from existential crisis.
  • Freedom from the tyranny of private property.
  • Freedom of safety and security through equal treatment under the rule of law and protection from violence and the fear of violence.
  • Freedom from deceptive manipulation, exploitation and coercion.
  • Freedom from ignorance and equal access to multidimensional training, skills, knowledge, deep learning & information.
  • Freedom of health, wellness and well-being through equal access to healing, training and nourishing resources.
  • Freedom of speech and self-expression through equal access to all arenas of communication and media.
  • Freedom and equality of travel and relocation.
  • Freedom and equality of peaceful assembly and association.
  • Freedom from prejudice, disenfranchisement and social isolation.
  • Freedom and equality of privacy and participation.
  • Freedom and equality of spiritual, psychosocial and moral development.
  • Freedom and equality of opportunity through mutual trust, collective participation, and sharing of common property and communal social capital.
  • Freedom and equality of “spaciousness” in free time, quiet and solitude.
  • Freedom and equality of opportunity and support for self-reliance.

Finally, an additional tool to help answer this question is similar to the way we could approach res communes property designations: to ask what products and services have already - for years or even decades - arrived at relatively static, price-inelastic demand in a market economy. At a minimum, this could help determine which services and production could be delivered via non-profit rather than for-profit enterprise.

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