Shopping on line can be easy, simple and save you lots of money. It can also take a lot of your time, frustrate you, and result in unwanted purchases. Now the same can be said for regular high street shopping, but with the vast opportunity presented by the Internet it will pay you to spend a few minutes reading this and understanding how to better optimize your Binary Economics shopping experience:

1. Compare - without doubt the biggest advantage that the Binary Economics offers shoppers today is the ability to compare thousands of Binary Economics at a time. This is a great thing, but not necessarily all the time! Too much can be daunting at times so take advantage of the great comparison sites and where possible let them do the hard work for you.

2. Research - if it has been said it will be on the internet. Ignorance is no longer a justifiable reason for buying the wrong thing. Take the time to research in detail everything that you could possible want to know about

3. Testimonials - don't know anybody that has bought a Binary Economics? Wrong! If the Binary Economics is good the internet will let you know. Use the Internet as a friend and get testimonials before you buy.

4. Questions - Got a question about Binary Economics then search the Forums, FAQ's, Blogs etc. Don't be afraid to ask .....

5. Reputation - Never heard of the company selling Binary Economics? Don't worry, no reason why you should know every company in the world, but you know someone that does! Use the internet to find out what people are saying about Binary Economics and build up a picture of their reputation for sales, returns, customer service, delivery etc.

6. Returns - still worried that even after all of the above your Binary Economics wont be what you want? Check out the returns policy. There is so much competition now that someone, somewhere is bound to offer the terms that you are comfortable with.

7. Feedback - happy with your Binary Economics then let people know, after all you are depending on others people input in your buying decision, so why not give a little back.

8. Security - check for the yellow padlock on the Binary Economics site before you buy, and the s after http:/ /i.e. https:// = a secure site

9. Contact - got a question about Binary Economics, or want to leave a comment then check out the sites contact page. Reputable companies have them and respond.

10. Payment - ready to pay for your Binary Economics, then use your credit card or PayPal! Be aware of companies that don't accept them, there may be genuine reasons but given the huge amount of choice you have when buying online there is no reason at all not to buy via credit card or PayPal.

Binary economics is a school of economics expressing a new universal paradigm which challenges the fundamental assumptions of conventional economics. It states that it is a private property, market economics which ensures that, over time, all individuals come to ownership of an independent capital estate providing an income.Robert Ashford & Rodney Shakespeare (1999) Binary Economics – the new paradigm.

A summary of binary economics might be – a justice which creates efficiency and an efficiency which creates justice.John H. Miller ed. (1994) Curing World Poverty: the New Role of Property. A more detailed summary could be – the use of central bank-issued interest-free loans, administered by the banking system, for the development and spreading of ownership of various forms of productive capacity (and the associated consuming capacity) to all individuals in the population thereby creating a balance of supply and demand and forwarding social and economic justice.Rodney Shakespeare (2007) The Modern Universal Paradigm.

The theory proposes that a society's central bank be used as the source of interest-free loans.

The proposal claims that it would cut in half the costs of infrastructure improvements such as bridges and hospitals, reduce business startup costs, and allow greater possibility for ownership of stocks.

Because a major aim is to ensure that all individuals in the population come to ownership of a substantial capital estate providing an independent income binary economics cannot be placed anywhere on the conventional left-right spectrum for understanding economics and politics.Robert Ashford (1990) The Binary Economics of Louis Kelso: the Promise of Universal Capitalism (Rutgers Law Journal, vol. 22 No.1. Fall, 1990). Communist Pravda, trying to make a logical placing of binary economics and patently failing, thought it extreme right;Robert Ashford & Rodney Shakespeare (1999) op. cit; while 'free market' capitalist economist Milton Friedman thought it extreme left.Time Magazine, June 29, 1970.

Binary economics expresses a concept of unicity and relatedness. At the core of the concept is the upholding of an ethic whose substance is that there is an absolute duty to ensure that all humans have clean water, good health, housing, education and a reasonable independent income. The duty extends to the fauna, flora and environment of the world in which we live. Because binary economics makes extensive use of central bank-issued interest-free loans (interest-free, but not free of administration cost) it is compatible with the traditional opposition of Islam and Christianity to Usury (defined as the practice of profiting from the interest on loaned money).Rodney Shakespeare & Peter Challen (2002) Seven Steps to Justice.

ProponentsNorman Kurland, Dawn Brohawn & Michael Greaney (2004)Capital Homesteading for Every Citizen: A Just Free Market Solution for Saving Social Security. of binary economics claim that their system contains no expropriation of wealth, and much less redistribution will be necessary (for example, by taxes in order to fund forms of government spending including welfare benefits). Because there is less redistribution there is less taxation.

Binary economics states that it cannot cause inflation and is of particular importance in a world where, increasingly, more of the physical contribution to production is being, and will be, done by machines and near-robots.James S. Albus (1976) Peoples' Capitalism - The Economics of The Robot Revolution. Many developing countries do not lack human and material resource and advocates of binary economics believe it to be particularly helpful in addressing the issue of why they unnecessarily languish.A notable lecture on this matter was given by Ing. B.J Habibie (former President, The Republic of Indonesia) at the international conference Islamic Economics and Banking in the 21st Century, Jakarta, Indonesia, November, 2005. The former President, a successful aircraft engineer, well understands the potential of technology to create wealth. See also Thoby Mutis (1995) Pendekatan Ekonomi Pengetahuan dalam Manajemen Kodedeterminass. However, paradigmatic change will be necessary.Sofyan Syafri Harahap (2005), Accounting Crisis. William Christensen Search for a Universal Paradigm: Making Justice Live For All International Conference on Universal Paradigm of Socio-Scientific Reasoning, Asian University of Bangladesh, 2005.

Advocates Rodney Shakespeare & Peter Challen (2002) Seven Steps to Justice. of binary economics contend that implementing their system will lessen national debt and encourage national unity. They believe that binary economics creates a stable economy and associated financial system which is not subject to unsustainable booms and resulting crashes.

The ‘binary’ (in ‘binary economics’) means ‘composed of two’ because it suffices to view the physical factors of production as being but two (labour and capital which includes land; money is not, in itself, a physical factor of production) and thus there are only two ways of genuinely earning a living − by labour and/or by the ownership of productive capital. In viewing the two physical factors it can also be observed that humans own their own labour but they do not necessarily own the other factor – capital.Louis Kelso & Patricia Hetter Kelso (1967) Two-Factor Theory: the Economics of Reality.

In its intent to involve people in ownership and participation binary economics has affinity with the Mondragon region of Spain, the Emilia-Romagna region of Italy and Distributism.

Binary economics is currently a minority discipline.

Background Although elements of binary economics can be found elsewhere (for example, in Pope Leo XIII Rerum Novarum 1891; Harold Moulton (1935) The Formation of Capital; the Distributism of G.K. Chesterton and Hilaire Belloc; and Ibn Ashur (1946) Maqasid al Shari’ah al Islamiya) the first clear formulation of the subject was by American lawyer Louis Kelso and Mortimer Adler (the Aristotelian philosopher and educator) in their book The Capitalist Manifesto (1958). The title of the book is best viewed as a thing of its time being a Cold War reference in opposition to communism. More information about Mortimer Adler can be found at Center for the Study of The Great IdeasKelso and Adler continued to write together - The New Capitalists (1961) contributes greatly to the understanding of collateral and capital credit insurance - and then Kelso teamed up with political scientist Patricia Hetter Kelso to explain how capital instruments provide an increasing percentage of the wealth and why capital is narrowly owned in the modern industrial economy.Louis Kelso & Patricia Hetter Kelso (1986 & 1991) Democracy and Economics Power - Extending the ESOP Revolution through Binary Economics Their analysis predicts that widely distributed capital ownership will create a more balanced economy. This is at the heart of the binary claim to create an efficiency which creates justice and vice versa.

Kelso and Hetter then proposed new binary share holdings which (with exception for research, maintenance and depreciation) would pay out their full capital earnings, be capable of being insured and, if loss occurred, would occasion no recourse to the new binary owners. Because of the full payout provision they argued that binary holdings would pay-out more than five times what is typically paid out today. This could allow a new widespread capital ownership to achieve a widespread income, and associated individual incomes which could be possessed by anybody in the population irrespective of whether or not that person is in a conventional job.

Employee Share Ownership Plans (ESOPs) and other Plans Very often the first acquaintance people have with binary economics comes through today’s Employee Share Ownership Plans (ESOPs).William Greider (1997) One World, Ready or Not: The Manic Logic of Global Capitalism. These stem originally from Louis Kelso & Patricia Hetter Kelso (1967)Two-Factor Theory: The Economics of Reality; the founding of Kelso & Company in 1970; and then from conversations in the early 1970s between Louis Kelso, Norman Kurland (Center for Economic and Social Justice), Senator Russell Long of Louisiana (Chairman, USA Senate Finance Committee, 1966 - 1981) and Senator Mike Gravel of Alaska. There are about 11,500 ESOPs in the USA today covering 11 million employees in closely held companies. Another estimated 15 million employees in public companies participate in one form or another of ESOP variation.

Productiveness is forwarded by employee ownershipJohn Logue et al. (1998) Participatory Employee Ownership. C. Rosen & M Quarrey (1987 65 Harvard Bus. Rev.) How Well is Employee Ownership Working? and involvement - binary techniques for this are called Justice Based Management. The legal entity which acts for the employees and oversees the capital acquisition and distribution of profits, is the ESOP trust.

Conventional economics compared with binary economics - areas of conflict, criticism and contrast A good understanding of binary economics can be obtained by contrasting various aspects with comparable aspects in conventional economics (especially mainstream Neoclassical economics).

Very broadly, the first contrast is between 'positive economics' (the analysis of 'what is') and 'normative economics' (the critique of the existing system and the proposing of 'what ought to be' - binary economics).

However, also central to binary economics is an analysis of physical reality, i.e., of what is. The binary productiveness analysis is claimed to be a superior account of reality and so binary proposals for change are ultimately claimed to be firmly grounded in everyday life. Conventional economics upholds productivityRobert A. Solo (1991) The Philosophy of Science and Economics which is not a direct analysis of physical reality: rather it is the calculation of a ratio or rate of total output divided by unit of input (though usually having separate labour & capital input-components, e.g Cobb-Douglas). In contrast, the binary analysis of productiveness (see section below) attempts to give accurate credit to the physical contributions of both labour and capital to production, attempting to answer a fundamental economic question - Who or what physically creates the wealth?

The third contrast is that conventional economics believes that interest (as distinct from administration cost) is always necessary but binary economics states that, certainly where the development and spreading of productive (and the associated consuming) capacity is concerned, interest (as distinct from administration cost) is not necessary.Rodney Shakespeare (2007) op. cit. Moreover, where newly-created money is concerned, conventional economics upholds the doctrine of the time value of money whereas binary economics does not because, nowadays, money is created out of nothing by pressing computer buttons.

Fourthly, an assumption of general scarcity is at the heart of conventional economics. Binary economics, however, denies the assumption. Amartya Sen argued that starvation is primarily due to lack of money in the hands of the starving and not the absence of food: thus it is human attitudes, practice and institutions which are at fault.

Binary economics also rejects conventional financial savings doctrine (that there must be financial savings prior to investment) - no financial saving is necessary because money today is not gold; rather it is created out of nothing.Michael Rowbotham (1998) The Grip of Death. James Gibb Stuart (1983) The Money Bomb. The theory asserts that what matters is whether the newly-created money is interest-free, whether it can be repaid, whether there is effective Collateral (finance) and whether it goes towards the development and spreading of various forms of productive (and the associated consuming) capacity.

The contrast continues: Unlike Binary economics, conventional economics is largely unconcerned that the present money supply is generally not directed at the development and spreading of productive capacity together with the associated consuming capacity -- broadly, productive capital is narrowly ownedEdward N. Wolff (1995) Top Heavy: A Study of Increasing Inequality in America and (1995) How The Pie Is Sliced: America's Growing Concentration of Wealth..

Binary economics is well aware that the banking system, by the use of fractional reserve banking, today creates vast amounts of money out of nothing.John Tomlinson (1993) Honest Money. Joseph Huber & James Robertson Creating New Money. Peter Selby (1997) Grace and Mortgage.

Very fundamentally, binary economics rejects the claim of conventional economics that it promotes a ‘free market’ which is free, fair and efficient. (e.g., as an interpretation of the classical General equilibrium#First Fundamental Theorem of Welfare Economics).

The two economics differ on the subject of democracy. Conventional economics upholds the periodic political vote. Binary economics does the same but then deepens democracyRoy Madron & John Jopling (2003) Gaian Democracies. by insisting that productive capital and the practical everyday power its ownership gives to individuals be widely distributed as well. In binary economics freedom is only truly achieved if all individuals are able to acquire an independent economic base.

Perhaps most importantly of all in the long run, is the ability to address environmental issues. In this area binary economics claims to have a big advantage over conventional economics because it can use the supply of interest-free loans. (See Environment section below.) The appropriate (positive) interest rate dominates conventional economic analysis of environment policy (e.g. Stern Review#Market rates).

Uses of Central Bank-issued Interest-free Loans Binary economics proposes that central bank-issued interest-free loans should be administered by the banking system for the development and spreading of productive (and the associated consuming) capacity, particularly new capacity, as well as for environmental and public capital. While no interest would be charged, there would be an administrative cost as well as (should forms of collateral be inadequate) capital credit insurance.Norman Kurland (1998) The Federal Reserve Discount Window — www.cesj.org

The supply of interest-free loans takes place in circumstances of a move (over time) towards banks maintaining reserves equal to 100% of their deposits. Thus the banking system would not be continually creating money (as happens today as a result of the fractional reserve system) but would be confined to lending (with permission) depositors’ money and the bank’s own capital at the same time as administering the interest-free loans. Some binary economists propose that, assuming understanding of binary principles, the International Monetary Fund and its Special Drawing Rights could implement capital ownership for all citizens of the world.

The main uses of the central bank-issued interest-free loans are as follow:-

Public Capital InvestmentInterest-free loans would allow hospitals, sewage works, social housing, roads, bridges etc. to be built for one half, or one third of the present cost. (This use is also advocated by the USA Sovereignty movement - Dennis Kucinich, Ken Bohnsack et al.). However, the capital projects can still, if wished, be built, managed, even owned, by the private sector and use made of Community Investment Corporations and the like. In these Corporations local citizens own the local land and get the rents from it.Norman Kurland, Dawn Brohawn & Michael Greaney (2004) op. cit.

In the past interest-free loans for public capital have been successfully used in Canada, New Zealand and Guernsey. Malaysia is today believed to be experimenting with them.Rodney Shakespeare & Peter Challen (2002) op. cit.

Moreover, a major consequence of the use of interest-free loans would be a great diminution of the National Debt.

After 1949 central bank loans were a major factor in the Taiwanese Land to the Tiller program which spread land ownership from the few to the many. This was done without causing inflation and was an overall binary solution because, in various ways (including financing the buyout with industrial bonds, thus giving capital to small industries to provide things for the newly empowered farmers to purchase) the money went into the spreading of both productive and consuming capacity.John Medaille (2007) The Vocation of Business: Social Justice in the Marketplace.

Private Capital InvestmentOwnership of productive (and the associated consuming) capacity, particularly new capacity, can be spread by the use of central bank-issued interest-free loans.Shann Turnbull (1975/2000) Democratising the Wealth of Nations and (2001) The Use of Central Banks to Spread Ownership. Jeff Gates (1999) The Ownership Solution and (2000) Democracy At Risk. Interest-free loans should be allowed for private capital investment IF such investment creates new owners of capital and is part of national policy to enable all individuals, over time, on market principles, to become owners of substantial amounts of productive, income-producing capital.Norman Kurland (2001) Saving Social Security at www.cesj.org. By using central bank-issued interest-free loans, a large company/corporation would get cheap half-cost or more money as long as new binary shareholders are created.

It is proposed that all large corporations should have to pay out all their earnings all the time (with exception of reserves for maintenance, depreciation, repair and research). Large corporations will then have the option of obtaining interest-free loans on condition that they help to spread ownership. Medium-sized corporations (which would not be subject to the full pay out provision) will be able to have interest-free loans if they spread ownership.

‘Green’ Environmental Capital InvestmentInterest-free loans should be used, in particular, for clean, renewable energy. At present, a lot of green technology projects are not financially viable. With interest-free loans, however, they would become viable and so we would be able to have clean electricity through tidal barrages, wave machines, wind turbines, solar electricity, and geothermal power stations etc.

There are many 'alternative' technologies - at present viewed with varying degrees of skepticism by mainstream science - that, in principle, would be eligible for research and development funding under binary economics. Some of these technologies, if physically possible, would enable the clean generation of electricity for cars, houses, trains and factories and they can be found among the Top 100 Technologies which are a mixture of that which lies within, on the edge of, and outside existing science e.g., Blacklight Power (Randell Mills); and Steorn.

Small and Start-up Businesses Including MicrofinanceInterest-free loans should be used for micro-finance, small business and farms thereby freeing them from the huge pressure of compounding interest-bearing debt. Farm capital can be one half or less of the usual cost. The world’s poor people (e.g., Bangladesh womenAbulhasan Sadeq Microfinance, Poverty Alleviation and Economic Development: Theory and Practice international conference on A Universal Paradigm of Socio-Scientific Reasoning at Asian University of Bangladesh, 2005. - 55% of the world's population live on under $3 per day) could be enabled to halve or more the cost of building small businesses by the use of interest-free micro-finance being funnelled through the Grameen Bank and similar institutions such as the Institute for Integrated Rural Development.

Loans to StudentsIt is binary policy that, since further and higher education should be encouraged, student loans should not bear interest. If they do, students can become burdened by debt for the rest of their lives.

HomesAt present the money supply largely goes into existing assets (e.g. the continual inflation of house prices around the world) rather than into the development and spreading of new productive capacity. It is not the intention in any way to risk adding to the inflation but, certainly when there is 100% banking reserves, the use of interest-free loans for homes will be considered.

Estate dutyAs part of binary policy to develop capital ownership for each member of the population, there is no estate duty (or Inheritance Tax) on death IF the estate devolves in such a way as to spread capital estates, and therefore capital ownership, to more individuals. If it does not do so, then there is a graduated tax.

Productiveness Binary productiveness and conventional productivity are distinct concepts.Mark Douglas Reiners The Binary Alternative and the Future of Capitalism available at Center for Economic and Social Justice.

Conventional productivity, generally labour productivity, is the ratio of labor as input to the overall output.Robert Ashford Binary Economics − an overview (2006) http://ssrn.com/abstract=928752.

In contrast, binary productiveness is the percentage of total physical input that labor and capital each contributes to the output.Robert Ashford Louis Kelso’s Binary Economy (The Journal of Socio-Economics, vol.25, 1996). Capital contributes an increasing physical percentage as even Marx understood.Louis Kelso Karl Marx: The Almost Capitalist (American Bar Association Journal, March, 1957). Consider the example of a man digging a hole. Using his hands this takes him four hours. But, by using a form of capital − a shovel − he can dig the hole in one hour or dig four holes in the same amount of time it took him to dig one hole with his hands. The physical productiveness of the human labor is 25% while the physical productiveness of the capital shovel is 75%. The position changes even more radically when a mechanical shovel, or machine digger, is used. Although the man uses skill and effort they may not amount to much more skill and effort than that involved in the man using the shovel alone and, in any case, there is very much less effort. The mechanical digger, however, is now contributing a huge percentage of the total output. Together, of course, man and shovel, or man and mechanical digger − labour and capital − produce much more by co-operation than they would produce separately.

A criticism of the hole and shovel example has been made by Timothy D. TerrellTimothy D. Terrell Binary Economics: Paradigm Shift Or Cluster of Errors? Ludwig von Mises Institute. summarizing a critique given by Timothy Roth.Timothy P. Roth, (1996) A Supply-Sider’s (Sympathetic) View of Binary Economics, Journal of Socio-Economics 25 (1) pp. 58–59. The criticism states that: a) somebody invented the shovel; b) the shovel cannot be independent. Roth argues that someone with human capital had to invent the shovel before it could be used, so the presence of the shovel is not independent of human capital. Also, Roth notes the presumption that the human hole digger has no role in the productiveness of the shovel.

However, binary economics states that the fact that somebody invented the shovel has nothing to do with its present use for digging a hole and the shovel is viewed as an independent contributor which co-operates with the man just as the man co-operates with the shovel. Moreover, just as two humans can, and do, co-operate, so the man and the shovel co-operate to dig the hole and produce far more holes than either the man or shovel could do by themselves. Binary economics does not say the human digger has no role in the shovel’s productiveness − both binary economics and RothTimothy P Roth (1996) op. cit. p. 60. agree that man and shovel together produce far more than man or shovel separately.

Selected External Links

Selected Texts • Albus, James S.(1976) Peoples’ Capitalism - The Economics of The Robot Revolution.

• Ashford, Robert & Shakespeare, Rodney (1999) Binary Economics - the new paradigm.

• Ashford, Robert Louis Kelso’s Binary Economy (The Journal of Socio-Economics, vol. 25, 1996).

• el-Diwany, Tarek (2003) The Problem With Interest.

• Gates, Jeff (1999) The Ownership Solution.

• Gates, Jeff (2000) Democracy At Risk.

• Gauche, Jerry Binary Modes for the Privatization of Public Assets (The Journal of Socio-Economics. Vol. 27, 1998).

• Greenfield, Sidney M. Making Another World Possible: the Torah, Louis Kelso and the Problem of Poverty (paper given at conference, Colombia University, May, 2006).

• Kelso, Louis & Kelso, Patricia Hetter (1986 & 1991), Democracy and Economic Power - Extending the ESOP Revolution through Binary Economics.

• Kelso, Louis & Adler, Mortimer (1958), The Capitalist Manifesto.

• Kelso, Louis & Adler, Mortimer (1961), The New Capitalists.

• Kelso, Louis & Hetter, Patricia (1967), Two-Factor Theory: the Economics of Reality.

• Kurland, Norman A New Look at Prices and Money: The Kelsonian Binary Model for Achieving Rapid Growth Without Inflation.

• Kurland, Norman; Brohawn, Dawn & Michael Greaney (2004) Capital Homesteading for Every Citizen: A Just Free Market Solution for Saving Social Security.

• Miller, J.H. ed., (1994), Curing World Poverty: The New Role of Property.

• Reiners, Mark Douglas, The Binary Alternative and Future of Capitalism.

• Shakespeare, Rodney & Challen, Peter (2002) Seven Steps to Justice.

• Shakespeare, Rodney (2007) The Modern Universal Paradigm.

• Turnbull, Shann (2001) The Use of Central Banks to Spread Ownership.

• Turnbull, Shann (1975/2000), Democratising the Wealth of Nations.

References Binary economics is a school of economics expressing a new universal paradigm which challenges the fundamental assumptions of conventional economics. It states that it is a private property, market economics which ensures that, over time, all individuals come to ownership of an independent capital estate providing an income.Robert Ashford & Rodney Shakespeare (1999) Binary Economics – the new paradigm.

A summary of binary economics might be – a justice which creates efficiency and an efficiency which creates justice.John H. Miller ed. (1994) Curing World Poverty: the New Role of Property. A more detailed summary could be – the use of central bank-issued interest-free loans, administered by the banking system, for the development and spreading of ownership of various forms of productive capacity (and the associated consuming capacity) to all individuals in the population thereby creating a balance of supply and demand and forwarding social and economic justice.Rodney Shakespeare (2007) The Modern Universal Paradigm.

The theory proposes that a society's central bank be used as the source of interest-free loans.

The proposal claims that it would cut in half the costs of infrastructure improvements such as bridges and hospitals, reduce business startup costs, and allow greater possibility for ownership of stocks.

Because a major aim is to ensure that all individuals in the population come to ownership of a substantial capital estate providing an independent income binary economics cannot be placed anywhere on the conventional left-right spectrum for understanding economics and politics.Robert Ashford (1990) The Binary Economics of Louis Kelso: the Promise of Universal Capitalism (Rutgers Law Journal, vol. 22 No.1. Fall, 1990). Communist Pravda, trying to make a logical placing of binary economics and patently failing, thought it extreme right;Robert Ashford & Rodney Shakespeare (1999) op. cit; while 'free market' capitalist economist Milton Friedman thought it extreme left.Time Magazine, June 29, 1970.

Binary economics expresses a concept of unicity and relatedness. At the core of the concept is the upholding of an ethic whose substance is that there is an absolute duty to ensure that all humans have clean water, good health, housing, education and a reasonable independent income. The duty extends to the fauna, flora and environment of the world in which we live. Because binary economics makes extensive use of central bank-issued interest-free loans (interest-free, but not free of administration cost) it is compatible with the traditional opposition of Islam and Christianity to Usury (defined as the practice of profiting from the interest on loaned money).Rodney Shakespeare & Peter Challen (2002) Seven Steps to Justice.

ProponentsNorman Kurland, Dawn Brohawn & Michael Greaney (2004)Capital Homesteading for Every Citizen: A Just Free Market Solution for Saving Social Security. of binary economics claim that their system contains no expropriation of wealth, and much less redistribution will be necessary (for example, by taxes in order to fund forms of government spending including welfare benefits). Because there is less redistribution there is less taxation.

Binary economics states that it cannot cause inflation and is of particular importance in a world where, increasingly, more of the physical contribution to production is being, and will be, done by machines and near-robots.James S. Albus (1976) Peoples' Capitalism - The Economics of The Robot Revolution. Many developing countries do not lack human and material resource and advocates of binary economics believe it to be particularly helpful in addressing the issue of why they unnecessarily languish.A notable lecture on this matter was given by Ing. B.J Habibie (former President, The Republic of Indonesia) at the international conference Islamic Economics and Banking in the 21st Century, Jakarta, Indonesia, November, 2005. The former President, a successful aircraft engineer, well understands the potential of technology to create wealth. See also Thoby Mutis (1995) Pendekatan Ekonomi Pengetahuan dalam Manajemen Kodedeterminass. However, paradigmatic change will be necessary.Sofyan Syafri Harahap (2005), Accounting Crisis. William Christensen Search for a Universal Paradigm: Making Justice Live For All International Conference on Universal Paradigm of Socio-Scientific Reasoning, Asian University of Bangladesh, 2005.

Advocates Rodney Shakespeare & Peter Challen (2002) Seven Steps to Justice. of binary economics contend that implementing their system will lessen national debt and encourage national unity. They believe that binary economics creates a stable economy and associated financial system which is not subject to unsustainable booms and resulting crashes.

The ‘binary’ (in ‘binary economics’) means ‘composed of two’ because it suffices to view the physical factors of production as being but two (labour and capital which includes land; money is not, in itself, a physical factor of production) and thus there are only two ways of genuinely earning a living − by labour and/or by the ownership of productive capital. In viewing the two physical factors it can also be observed that humans own their own labour but they do not necessarily own the other factor – capital.Louis Kelso & Patricia Hetter Kelso (1967) Two-Factor Theory: the Economics of Reality.

In its intent to involve people in ownership and participation binary economics has affinity with the Mondragon region of Spain, the Emilia-Romagna region of Italy and Distributism.

Binary economics is currently a minority discipline.

Background Although elements of binary economics can be found elsewhere (for example, in Pope Leo XIII Rerum Novarum 1891; Harold Moulton (1935) The Formation of Capital; the Distributism of G.K. Chesterton and Hilaire Belloc; and Ibn Ashur (1946) Maqasid al Shari’ah al Islamiya) the first clear formulation of the subject was by American lawyer Louis Kelso and Mortimer Adler (the Aristotelian philosopher and educator) in their book The Capitalist Manifesto (1958). The title of the book is best viewed as a thing of its time being a Cold War reference in opposition to communism. More information about Mortimer Adler can be found at Center for the Study of The Great IdeasKelso and Adler continued to write together - The New Capitalists (1961) contributes greatly to the understanding of collateral and capital credit insurance - and then Kelso teamed up with political scientist Patricia Hetter Kelso to explain how capital instruments provide an increasing percentage of the wealth and why capital is narrowly owned in the modern industrial economy.Louis Kelso & Patricia Hetter Kelso (1986 & 1991) Democracy and Economics Power - Extending the ESOP Revolution through Binary Economics Their analysis predicts that widely distributed capital ownership will create a more balanced economy. This is at the heart of the binary claim to create an efficiency which creates justice and vice versa.

Kelso and Hetter then proposed new binary share holdings which (with exception for research, maintenance and depreciation) would pay out their full capital earnings, be capable of being insured and, if loss occurred, would occasion no recourse to the new binary owners. Because of the full payout provision they argued that binary holdings would pay-out more than five times what is typically paid out today. This could allow a new widespread capital ownership to achieve a widespread income, and associated individual incomes which could be possessed by anybody in the population irrespective of whether or not that person is in a conventional job.

Employee Share Ownership Plans (ESOPs) and other Plans Very often the first acquaintance people have with binary economics comes through today’s Employee Share Ownership Plans (ESOPs).William Greider (1997) One World, Ready or Not: The Manic Logic of Global Capitalism. These stem originally from Louis Kelso & Patricia Hetter Kelso (1967)Two-Factor Theory: The Economics of Reality; the founding of Kelso & Company in 1970; and then from conversations in the early 1970s between Louis Kelso, Norman Kurland (Center for Economic and Social Justice), Senator Russell Long of Louisiana (Chairman, USA Senate Finance Committee, 1966 - 1981) and Senator Mike Gravel of Alaska. There are about 11,500 ESOPs in the USA today covering 11 million employees in closely held companies. Another estimated 15 million employees in public companies participate in one form or another of ESOP variation.

Productiveness is forwarded by employee ownershipJohn Logue et al. (1998) Participatory Employee Ownership. C. Rosen & M Quarrey (1987 65 Harvard Bus. Rev.) How Well is Employee Ownership Working? and involvement - binary techniques for this are called Justice Based Management. The legal entity which acts for the employees and oversees the capital acquisition and distribution of profits, is the ESOP trust.

Conventional economics compared with binary economics - areas of conflict, criticism and contrast A good understanding of binary economics can be obtained by contrasting various aspects with comparable aspects in conventional economics (especially mainstream Neoclassical economics).

Very broadly, the first contrast is between 'positive economics' (the analysis of 'what is') and 'normative economics' (the critique of the existing system and the proposing of 'what ought to be' - binary economics).

However, also central to binary economics is an analysis of physical reality, i.e., of what is. The binary productiveness analysis is claimed to be a superior account of reality and so binary proposals for change are ultimately claimed to be firmly grounded in everyday life. Conventional economics upholds productivityRobert A. Solo (1991) The Philosophy of Science and Economics which is not a direct analysis of physical reality: rather it is the calculation of a ratio or rate of total output divided by unit of input (though usually having separate labour & capital input-components, e.g Cobb-Douglas). In contrast, the binary analysis of productiveness (see section below) attempts to give accurate credit to the physical contributions of both labour and capital to production, attempting to answer a fundamental economic question - Who or what physically creates the wealth?

The third contrast is that conventional economics believes that interest (as distinct from administration cost) is always necessary but binary economics states that, certainly where the development and spreading of productive (and the associated consuming) capacity is concerned, interest (as distinct from administration cost) is not necessary.Rodney Shakespeare (2007) op. cit. Moreover, where newly-created money is concerned, conventional economics upholds the doctrine of the time value of money whereas binary economics does not because, nowadays, money is created out of nothing by pressing computer buttons.

Fourthly, an assumption of general scarcity is at the heart of conventional economics. Binary economics, however, denies the assumption. Amartya Sen argued that starvation is primarily due to lack of money in the hands of the starving and not the absence of food: thus it is human attitudes, practice and institutions which are at fault.

Binary economics also rejects conventional financial savings doctrine (that there must be financial savings prior to investment) - no financial saving is necessary because money today is not gold; rather it is created out of nothing.Michael Rowbotham (1998) The Grip of Death. James Gibb Stuart (1983) The Money Bomb. The theory asserts that what matters is whether the newly-created money is interest-free, whether it can be repaid, whether there is effective Collateral (finance) and whether it goes towards the development and spreading of various forms of productive (and the associated consuming) capacity.

The contrast continues: Unlike Binary economics, conventional economics is largely unconcerned that the present money supply is generally not directed at the development and spreading of productive capacity together with the associated consuming capacity -- broadly, productive capital is narrowly ownedEdward N. Wolff (1995) Top Heavy: A Study of Increasing Inequality in America and (1995) How The Pie Is Sliced: America's Growing Concentration of Wealth..

Binary economics is well aware that the banking system, by the use of fractional reserve banking, today creates vast amounts of money out of nothing.John Tomlinson (1993) Honest Money. Joseph Huber & James Robertson Creating New Money. Peter Selby (1997) Grace and Mortgage.

Very fundamentally, binary economics rejects the claim of conventional economics that it promotes a ‘free market’ which is free, fair and efficient. (e.g., as an interpretation of the classical General equilibrium#First Fundamental Theorem of Welfare Economics).

The two economics differ on the subject of democracy. Conventional economics upholds the periodic political vote. Binary economics does the same but then deepens democracyRoy Madron & John Jopling (2003) Gaian Democracies. by insisting that productive capital and the practical everyday power its ownership gives to individuals be widely distributed as well. In binary economics freedom is only truly achieved if all individuals are able to acquire an independent economic base.

Perhaps most importantly of all in the long run, is the ability to address environmental issues. In this area binary economics claims to have a big advantage over conventional economics because it can use the supply of interest-free loans. (See Environment section below.) The appropriate (positive) interest rate dominates conventional economic analysis of environment policy (e.g. Stern Review#Market rates).

Uses of Central Bank-issued Interest-free Loans Binary economics proposes that central bank-issued interest-free loans should be administered by the banking system for the development and spreading of productive (and the associated consuming) capacity, particularly new capacity, as well as for environmental and public capital. While no interest would be charged, there would be an administrative cost as well as (should forms of collateral be inadequate) capital credit insurance.Norman Kurland (1998) The Federal Reserve Discount Window — www.cesj.org

The supply of interest-free loans takes place in circumstances of a move (over time) towards banks maintaining reserves equal to 100% of their deposits. Thus the banking system would not be continually creating money (as happens today as a result of the fractional reserve system) but would be confined to lending (with permission) depositors’ money and the bank’s own capital at the same time as administering the interest-free loans. Some binary economists propose that, assuming understanding of binary principles, the International Monetary Fund and its Special Drawing Rights could implement capital ownership for all citizens of the world.

The main uses of the central bank-issued interest-free loans are as follow:-

Public Capital InvestmentInterest-free loans would allow hospitals, sewage works, social housing, roads, bridges etc. to be built for one half, or one third of the present cost. (This use is also advocated by the USA Sovereignty movement - Dennis Kucinich, Ken Bohnsack et al.). However, the capital projects can still, if wished, be built, managed, even owned, by the private sector and use made of Community Investment Corporations and the like. In these Corporations local citizens own the local land and get the rents from it.Norman Kurland, Dawn Brohawn & Michael Greaney (2004) op. cit.

In the past interest-free loans for public capital have been successfully used in Canada, New Zealand and Guernsey. Malaysia is today believed to be experimenting with them.Rodney Shakespeare & Peter Challen (2002) op. cit.

Moreover, a major consequence of the use of interest-free loans would be a great diminution of the National Debt.

After 1949 central bank loans were a major factor in the Taiwanese Land to the Tiller program which spread land ownership from the few to the many. This was done without causing inflation and was an overall binary solution because, in various ways (including financing the buyout with industrial bonds, thus giving capital to small industries to provide things for the newly empowered farmers to purchase) the money went into the spreading of both productive and consuming capacity.John Medaille (2007) The Vocation of Business: Social Justice in the Marketplace.

Private Capital InvestmentOwnership of productive (and the associated consuming) capacity, particularly new capacity, can be spread by the use of central bank-issued interest-free loans.Shann Turnbull (1975/2000) Democratising the Wealth of Nations and (2001) The Use of Central Banks to Spread Ownership. Jeff Gates (1999) The Ownership Solution and (2000) Democracy At Risk. Interest-free loans should be allowed for private capital investment IF such investment creates new owners of capital and is part of national policy to enable all individuals, over time, on market principles, to become owners of substantial amounts of productive, income-producing capital.Norman Kurland (2001) Saving Social Security at www.cesj.org. By using central bank-issued interest-free loans, a large company/corporation would get cheap half-cost or more money as long as new binary shareholders are created.

It is proposed that all large corporations should have to pay out all their earnings all the time (with exception of reserves for maintenance, depreciation, repair and research). Large corporations will then have the option of obtaining interest-free loans on condition that they help to spread ownership. Medium-sized corporations (which would not be subject to the full pay out provision) will be able to have interest-free loans if they spread ownership.

‘Green’ Environmental Capital InvestmentInterest-free loans should be used, in particular, for clean, renewable energy. At present, a lot of green technology projects are not financially viable. With interest-free loans, however, they would become viable and so we would be able to have clean electricity through tidal barrages, wave machines, wind turbines, solar electricity, and geothermal power stations etc.

There are many 'alternative' technologies - at present viewed with varying degrees of skepticism by mainstream science - that, in principle, would be eligible for research and development funding under binary economics. Some of these technologies, if physically possible, would enable the clean generation of electricity for cars, houses, trains and factories and they can be found among the Top 100 Technologies which are a mixture of that which lies within, on the edge of, and outside existing science e.g., Blacklight Power (Randell Mills); and Steorn.

Small and Start-up Businesses Including MicrofinanceInterest-free loans should be used for micro-finance, small business and farms thereby freeing them from the huge pressure of compounding interest-bearing debt. Farm capital can be one half or less of the usual cost. The world’s poor people (e.g., Bangladesh womenAbulhasan Sadeq Microfinance, Poverty Alleviation and Economic Development: Theory and Practice international conference on A Universal Paradigm of Socio-Scientific Reasoning at Asian University of Bangladesh, 2005. - 55% of the world's population live on under $3 per day) could be enabled to halve or more the cost of building small businesses by the use of interest-free micro-finance being funnelled through the Grameen Bank and similar institutions such as the Institute for Integrated Rural Development.

Loans to StudentsIt is binary policy that, since further and higher education should be encouraged, student loans should not bear interest. If they do, students can become burdened by debt for the rest of their lives.

HomesAt present the money supply largely goes into existing assets (e.g. the continual inflation of house prices around the world) rather than into the development and spreading of new productive capacity. It is not the intention in any way to risk adding to the inflation but, certainly when there is 100% banking reserves, the use of interest-free loans for homes will be considered.

Estate dutyAs part of binary policy to develop capital ownership for each member of the population, there is no estate duty (or Inheritance Tax) on death IF the estate devolves in such a way as to spread capital estates, and therefore capital ownership, to more individuals. If it does not do so, then there is a graduated tax.

Productiveness Binary productiveness and conventional productivity are distinct concepts.Mark Douglas Reiners The Binary Alternative and the Future of Capitalism available at Center for Economic and Social Justice.

Conventional productivity, generally labour productivity, is the ratio of labor as input to the overall output.Robert Ashford Binary Economics − an overview (2006) http://ssrn.com/abstract=928752.

In contrast, binary productiveness is the percentage of total physical input that labor and capital each contributes to the output.Robert Ashford Louis Kelso’s Binary Economy (The Journal of Socio-Economics, vol.25, 1996). Capital contributes an increasing physical percentage as even Marx understood.Louis Kelso Karl Marx: The Almost Capitalist (American Bar Association Journal, March, 1957). Consider the example of a man digging a hole. Using his hands this takes him four hours. But, by using a form of capital − a shovel − he can dig the hole in one hour or dig four holes in the same amount of time it took him to dig one hole with his hands. The physical productiveness of the human labor is 25% while the physical productiveness of the capital shovel is 75%. The position changes even more radically when a mechanical shovel, or machine digger, is used. Although the man uses skill and effort they may not amount to much more skill and effort than that involved in the man using the shovel alone and, in any case, there is very much less effort. The mechanical digger, however, is now contributing a huge percentage of the total output. Together, of course, man and shovel, or man and mechanical digger − labour and capital − produce much more by co-operation than they would produce separately.

A criticism of the hole and shovel example has been made by Timothy D. TerrellTimothy D. Terrell Binary Economics: Paradigm Shift Or Cluster of Errors? Ludwig von Mises Institute. summarizing a critique given by Timothy Roth.Timothy P. Roth, (1996) A Supply-Sider’s (Sympathetic) View of Binary Economics, Journal of Socio-Economics 25 (1) pp. 58–59. The criticism states that: a) somebody invented the shovel; b) the shovel cannot be independent. Roth argues that someone with human capital had to invent the shovel before it could be used, so the presence of the shovel is not independent of human capital. Also, Roth notes the presumption that the human hole digger has no role in the productiveness of the shovel.

However, binary economics states that the fact that somebody invented the shovel has nothing to do with its present use for digging a hole and the shovel is viewed as an independent contributor which co-operates with the man just as the man co-operates with the shovel. Moreover, just as two humans can, and do, co-operate, so the man and the shovel co-operate to dig the hole and produce far more holes than either the man or shovel could do by themselves. Binary economics does not say the human digger has no role in the shovel’s productiveness − both binary economics and RothTimothy P Roth (1996) op. cit. p. 60. agree that man and shovel together produce far more than man or shovel separately.

Selected External Links

Selected Texts • Albus, James S.(1976) Peoples’ Capitalism - The Economics of The Robot Revolution.

• Ashford, Robert & Shakespeare, Rodney (1999) Binary Economics - the new paradigm.

• Ashford, Robert Louis Kelso’s Binary Economy (The Journal of Socio-Economics, vol. 25, 1996).

• el-Diwany, Tarek (2003) The Problem With Interest.

• Gates, Jeff (1999) The Ownership Solution.

• Gates, Jeff (2000) Democracy At Risk.

• Gauche, Jerry Binary Modes for the Privatization of Public Assets (The Journal of Socio-Economics. Vol. 27, 1998).

• Greenfield, Sidney M. Making Another World Possible: the Torah, Louis Kelso and the Problem of Poverty (paper given at conference, Colombia University, May, 2006).

• Kelso, Louis & Kelso, Patricia Hetter (1986 & 1991), Democracy and Economic Power - Extending the ESOP Revolution through Binary Economics.

• Kelso, Louis & Adler, Mortimer (1958), The Capitalist Manifesto.

• Kelso, Louis & Adler, Mortimer (1961), The New Capitalists.

• Kelso, Louis & Hetter, Patricia (1967), Two-Factor Theory: the Economics of Reality.

• Kurland, Norman A New Look at Prices and Money: The Kelsonian Binary Model for Achieving Rapid Growth Without Inflation.

• Kurland, Norman; Brohawn, Dawn & Michael Greaney (2004) Capital Homesteading for Every Citizen: A Just Free Market Solution for Saving Social Security.

• Miller, J.H. ed., (1994), Curing World Poverty: The New Role of Property.

• Reiners, Mark Douglas, The Binary Alternative and Future of Capitalism.

• Shakespeare, Rodney & Challen, Peter (2002) Seven Steps to Justice.

• Shakespeare, Rodney (2007) The Modern Universal Paradigm.

• Turnbull, Shann (2001) The Use of Central Banks to Spread Ownership.

• Turnbull, Shann (1975/2000), Democratising the Wealth of Nations.

References

Introduction : Binary Economics - the modern universal paradigm
Recently Written. PRESS HERE TO BUY The Modern Universal Paradigm by Rodney Shakespeare ... Introduction. Binary economics is the expression of a new universal paradigm or new ...

Binary economics - Wikipedia, the free encyclopedia
Binary economics is a heterodox theory of economics that endorses both private property and a free market but proposes significant reforms to the banking system.

Binary economics - encyclopedia article - Citizendium
We are creating the world's most trusted encyclopedia and knowledge base. Once you join us and log in, you'll be able to edit this page instantly!

Loans : Binary Economics - the modern universal paradigm
Recently Written. PRESS HERE TO BUY The Modern Universal Paradigm by Rodney Shakespeare ... Loans. Uses of central bank-issued interest-free loans for the development and spreading ...

Amazon.co.uk: Binary Economics: The New Paradigm: Robert Ashford ...
Amazon.co.uk: Binary Economics: The New Paradigm: Robert Ashford, Rodney Shakespeare: Books ... This item is not eligible for Amazon Prime, but millions of other items are.

Amazon.com: Binary Economics: The New Paradigm: Robert Ashford, Rodney ...
Amazon.com: Binary Economics: The New Paradigm: Robert Ashford, Rodney Shakespeare: Books ... Save $10 when you spend $50 or more when you pay with Bill Me Later®. Offer valid Oct ...

The Global Justice Movement - Binary Economics
The Global Justice Movement works to ensure that all people can benefit from the amazing technological potential now available and to create peace through justice.

GJM: Binary Economics
by. Robert Ashford & Rodney Shakespeare. Binary economics proposes a secure income for all individuals by using ...

Binary Economics
Binary Economics-a justice which creates efficiency. Report of the COG Economics of Ownership Internet discussion group. organized by the Ohio Employee Ownership Center, Kent State ...

Binary Economics in a Nutshell
Ten Controversial Questions asks about economy and concentration of wealth, etc. ... Many other writers on "worker ownership," "broad-based capital ownership," and "participatory ...

 

Binary Economics



 
Copyright © 2008 Hintcenter.com - All rights reserved.
Home | Terms of Use | Privacy Policy
All Trademarks belong to their repective owners. Many aspects of this page are used under
commercial commons license from Yahoo!