Resilience redistibution (was: Ripple.com and taking the project to the next level)

[Ryan Fugger]

OK, can you work through an example for me so I understand what is going on?

Suppose during a period I spend $1000, receive $1500, and have my redistribution set to 2%.  So I put $20 in to the redistribution pot, right?  There are 100 people in the whole redistribution pool, and the average spend is $2000, average receive is $2000 (must be equal to spend in a closed system), and average redistribution rate is 1.2%.  How much do I receive from the redistribution pot, and why?  Make any other assumptions you need.

Thanks,
Ryan

On Tue, May 7, 2013 at 9:47 AM, Johan Nygren <biped...@gmail.com> wrote:

*the sum of their spendings

On Tue, May 7, 2013 at 6:41 PM, Johan Nygren <biped...@gmail.com> wrote:

not the amount the redistribute but the sum of their transactions,

one node can have sent money to multiple different networks, and will receive from all of them up to the sum of their transactions with those networks,

this solution is essentially just a measure of 'citizenship' where nodes are part of the networks the send money to / invest in,
it makes it simple for anyone to join any network anywhere at any time.

that´s the best solution I could design, I kind of like it.

On Tue, May 7, 2013 at 6:32 PM, Ryan Fugger <a...@ryanfugger.com> wrote:

On Mon, Apr 22, 2013 at 1:53 PM, Johan Nygren <biped...@gmail.com> wrote:

the simplest solution I´ve come up with is that people receive relative how much they invest (sum of their transactions),
one person can receive from multiple different networks, but only relative his transaction activity with those networks,

If people receive in direct proportion to how much they put in, then they get back exactly what they put in, and there's no point.

 

and transactions are 'flagged' with your nodes redistribution rate (in some cases the recipients - more on that later), changing the rate does not change flagged 'transaction memories'

*there were some dubious facts in my first post
but you´ll come to similar design solutions,
and decentralizing 'redistribution governance' (and the intonation between different currencies - long story...) is probably a common agenda :)

On Monday, April 22, 2013 10:41:20 PM UTC+2, Ryan Fugger wrote:

Do you mean that I can set my node's redistribution rate to, say, 2%, which would pay 2% of all my transaction value into a redistribution pool, from which I would get a share in proportion to the 2% rate I had set?  So if I decided to change my rate to 1%, my contribution would halve, but so would my take?

It's an interesting idea.  How would you police people setting up nodes with little or no transaction value just to collect a share of the pot?

Ryan

On Sun, Apr 21, 2013 at 2:20 PM, Johan Nygren <biped...@gmail.com> wrote:

*re-posted from mail*

What is Resilience ?

decentralized system for governing redistribution (evolution of state government):

each node sets a value for redistribution (0-100%), and receives in proportion
transactions are redistributed relative lowest value of the two nodes involved
nodes only receives redistribution up to total sum of their transactions/investments (can have investments in multiple different ripple networks and receive redistribution from each ripple network they trade with)

this scales and self-organizes

theory is that a decentralized system for governing redistribution = collective intelligence, wisdom of crowds, resilience,

scales to a self-organizing panarchy

oogle this: http://projectresilience.tumblr.com/image/42367647796

why decentralize governance of redistribution ? wisdom of crowds.

theory is that increased redistribution opens up niche for other currencies (imagine extreme of 100 % redistribution = gift economy - good for FOSS and 'social currency' value added ) - also think in context of ephemeralization & increased *wealth inequality* - & scarcity/abundance (redistribution increases with abundance ? - opens up for 'social currency' business like FOSS -reciprocal altruism - much to be said here)

friend requested you on Facebook, much easier to explain in chat,

we have multiple threads active and lot´s of loosely organized content

http://facebook.com/bipedaljoe

P2Pfoundation Michel Bauwens and bunch of other netizens likes it :)

On Sunday, April 21, 2013 8:22:27 AM UTC+2, Ryan Fugger wrote:

If you have an idea, feel free to post it.

On Sat, Apr 20, 2013 at 7:40 PM, Johan Nygren <biped...@gmail.com> wrote:

Ryan, 
I have an idea that adds a decentralized option for this: http://en.wikipedia.org/wiki/Redistribution_of_income_and_wealth
consider it in the context of this: http://www.youtube.com/watch?v=QPKKQnijnsM *Wealth Inequality in America*

If you see that it would add value,
connect with me

//Johan

On Sunday, December 2, 2012 12:58:54 AM UTC+1, Ryan Fugger wrote:

On Thu, Nov 29, 2012 at 2:18 PM, dwilliams <dudewi...@gmail.com> wrote:
> Does this approach let me define the boundaries of my social circle inside
> the system, or am I bound to share all my data with the entire network all
> the time?

Things that must be made public:

* offers of credit to your peers that you wish to make available for
Ripple through-transactions
* transaction paths, amounts, and when it was executed

Whether this is "all you data" is up to you...

I should mention that the system incorporates bitcoin-style coins that
are used to pay transaction fees and regulate transaction submission
rates against consensus processing capability -- they can be used for
payment as well as Ripple and offer privacy similar to bitcoins.
There is also, of course, actual bitcoin, which I'm sure will get
integrated to the system in various ways over time.  My sense is that
these more-private coins will be useful when more privacy is
necessary.

> In a decentralized financial network what happens when a similar credit default swap scheme runs its course through the system?

We've discussed this many times here.  The hope is that a
decentralized system acts as both a disincentive for individual actors
to take great risks, because there is no one to bail them out if they
fail, and as a stabilizing force against systemic shocks due to the
heterogeneity of the network.


I am planning on thinking more about homomorphic encryption systems,
but I can't even begin to imagine how one would be able to hide which
paths a transaction used in the network, while still allowing a third
party to confirm the validity of the transaction with zero knowledge.
How can they confirm validity without even knowing which credit limits
to compare against?  How can they know a path is valid without knowing
which parts of the network it uses, and whether the path is actual
continuous?  How do the other participants figure out the new credit
limits going forward without knowing which accounts get debited?  It
seems impossible...

Ryan

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[Jorge Timón]

On 5/7/13, Johan Nygren <biped...@gmail.com> wrote:
> decentralized identity verification,
> a p2p identity verification to prevent us from creating billions of
> accounts
>
> how would you design that ?

This is impossible as far as I know. We have discussed countless time
with different approaches at freicoin.org. This is freicoin's holy
grail for initial distribution.
So, please, tell me if you get anywhere.
Bitcoin's holy grail was p2p exchange and we've been telling
bitcoiners that what they needed was p2p ripple for at least a couple
of years.
Luckily our voices have been heard, I'll try to hear the call for
something close enough to p2p id. But I highly doubt that can be based
on trust too.

[Johan Nygren]

something like peertru.st ?

[Johan Nygren]

OK, for those new to this thread:

Resilience is a framework for Non-Monetized Value Added Taxation: swarm redistribution. 

It sprung from my work with the basic income movement, and uses the most deductive design I could come up with.
Monetary activity (spendings) is used as a measure of whom should receive redistribution from where; of what swarm one belongs to, and other then that it´s quite intuitive and we should implement it with whatever virtual currency software will become dominant,

preferably as soon as possible.

I had an interesting theory too:

could each node could set their own % for redistribution ? (and receive in proportion)

could there be market incentives for that % to average high enough to cover non-monetized value added ?

if so, this would completely decentralize redistribution governance.

I designed some rules that could make it work, called it Resilience, and this is what Ryans example is about. 

I wrote a quick explanation in a drive document, and I´ll update it with better examples soon.

To answer Ryans example: each transaction inherits the lowest %, and thence Ryan would on average redistribute 1,2%. Ryan would then add $18, the others $24, thence Ryan would gain some money. Money was in short redistributed to those below GDP/capita - to fund their non-monetized value added.

Those below GDP/capita will benefit from trading with high % nodes, ventures that offer high % will gain customers, there will be competition to be ‘ethical’ in redistribution governance, ethical ventures will benefit from trading with ethical ventures (% are inherited, and customers like high %) - there will emerge venture-industries with high % because they'll attract more customers. Resilience adds a redistribution layer to the free-market framework.

This is not easy to understand, so try to reverse engineer the system in your own mind instead.

And remember: if it works, it would completely decentralize redistribution governance. It´s a work in progress.

Email, Tweet or Facebook me at any time,

biped...@gmail.com

facebook.com/bipdedaljoe

twitter.com/bipedaljoe

[Ryan Fugger]

On Fri, May 31, 2013 at 6:45 AM, Johan Nygren <biped...@gmail.com> wrote:

On Tuesday, May 7, 2013 7:08:17 PM UTC+2, Ryan Fugger wrote:

OK, can you work through an example for me so I understand what is going on?

Suppose during a period I spend $1000, receive $1500, and have my redistribution set to 2%.  So I put $20 in to the redistribution pot, right?  There are 100 people in the whole redistribution pool, and the average spend is $2000, average receive is $2000 (must be equal to spend in a closed system), and average redistribution rate is 1.2%.  How much do I receive from the redistribution pot, and why?  Make any other assumptions you need.

 

To answer Ryans example: each transaction inherits the lowest %, and thence Ryan would on average redistribute 1,2%. Ryan would then add $18, the others $24, thence Ryan would gain some money. Money was in short redistributed to those below GDP/capita - to fund their non-monetized value added.

I don't understand where $18 and $24 come from. What does it mean that each transaction inherits the lowest %?  Who pays into the pot -- payers, payment recipients, or both? 

Could you please work through the following example transaction-by-transaction, with account balances for each person as well as the redistribution pot at each step?

-----------

Participants A, B, C.  A has $1000 to start, B has $2000, C has $0.  A has redistribution rate 2%, B has redistribution rate 0%, C has redistribution rate 1%. 

1. A pays C $400.

2. B pays A $500.

3. C pays B $200.

4. B pays A $1000.

How much do they each put in, how much do they each get out, and why?  What are the balances for each person and the pot after each transaction?

------------

Thanks,
Ryan

[Alex Kotov]

Also did not understand how it works in particulars. But definitely this is good idea for p2p. It could be analog of demurrage which is hard to implement in p2p system.
Does every node set his universal redistribution rate or he can specify diferently it for others?

[email]

good observation, yes swarm redistribution is analogous to Silvio Gesell's "decaying currency", and can be done P2P without need for coordination around time or anything like that. the tax-rates are inherited, and spread, people specific their own, and then emergent behaviour. 

made a big improvement to the protocol last year. the propagation of swarm redistribution is now "multi-hop", solving the fake account problem.

https://telegra.ph/Multi-hop-swarm-redistribution-what-is-the-BIG-idea-04-21

the foundation of the multi-hop design is the idea that pulse amount per person decreases with distance with same factor as frequency of receiving pulse from any distance increases. I have simulated that, scripts and visualizations can be found in the blog post.

as you are aware, credit lines in Ripple clear continuously, so amount of credit lines should, to some extent, be similar for people, making propagation of multi-hop swarm redistribution work well.

[email]

I wrote a summary of the protocol with the "multi-hop" swarm redistribution design, here,
https://www.docdroid.net/OGGkVhn/resilience-a-person-to-person-safety-net-by-multi-hop-debt-reduction.pdf

[cojulapa]

I would have  three questions:

1) which event /who can trigger such a pulse?

2) is the mechanism forwarding this debt reduction done by the system (it is not a free decission of each node, it is simple executed on their credit lines), or can each node decide himself to forward it or not?

3) regarding your network simulations I wonder wether your assumed networks are a realistic respresentations of real (friend) networks. How did you generate them? (sorry, not so good in reading code) In real social networks in a group of people everybody is connected with the same people. So that one person tiggering a pulse will get it back multiple times after two hops again.

Regards

cojulapa

[email]

1) Triggered at each transaction, a transaction tax. Applied to every IOU, at each intermediary in payment routing.

Below is an example that shows payment routing of 1000 XYZ with one hop, from Me via Sally to You, with a 4% transaction tax, and multi-hop debt reduction by tax reallocation propagating outwards.

That tax is applied to every hop has some other benefits, it provides an incentive to route payments, the tax provides "reduced risk" to intermediaries as well as the web-of-trust, equivalent to interest rates for the network as a whole. Interest rates could also do so, but these are "interest rates" that are at a network-scale. By doing so, it also increases "liquidity" for multi-hop mutual credit, you can rely on the web-of-trust as a whole at least to some extent.

2) In an implementation with decentralized transaction processing (in the sense Ryan Fugger uses it here), propagation would computed person-to-person, by multi-hop. So it is decided by each node, as the pulses approach infinitely small there is no incentive to propagate them. Pulses can converge, so propagation can be delayed until it is worth it.

3) The simulations just assume everyone has on average the same amount of open credit lines. It just shows that how often you are reached by pulses is roughly in proportion to how much a pulse has diminished with distance, if everyone has exact same number of open credit lines it is exactly in proportion, but intent is to show it is roughly in proportion. Just generated with scripts, linked to in the blog post.

Pulses cannot loop as credit lines, when they loop, are cleared.

[email]

so transaction tax on every IOU and every hop. each person has input == output, same amount in as out. if you have no credit lines to you, you get "basic income". otherwise, you get "risk reduction", the network is paying off both your debt and those who have debt to you (so incentive to propagate. ) there is also a system to regulate tax-rates in a decentralized way, what I wanted to share is this new propagation mechanism that solves "multiple accounts" problem.

[cojulapa]

In your example pic the initial condition was all people having 0 in their credit line? 

I guess the red number show negative balances? as you said one reduces debt from others to myself

To understand the numbers one has to start at the destination of the pament, right? 

So you would ask for 1040 (why do you have 1041? btw) instead of 1000 from sally because of this tax rate. 

The 40 you split to your nodes, each receives 10. You owe them 10 now , or you cancle their debt, which is acutally equivalent to burn your money (The only incentive to do this from yours perspective is good will)

I dont see the point of risk reduction: 

Previously 4 people owed you 10, after the propagation this 40 are owed to you from sally... 

In my point of view this action is puting all the risk on sally defaulting (counterintuitive to risk diversification).... 

From sallys point of view:

she wants 1041 from me , adding up the transaction tax to make 1082 (you have 1085?)

The overhead she splits over her connections. Accumulating her risk to the credit line with me. 

I am not sure if I read your example correctly... happy when you clarify it... 

best regards

[email]

The tax that is paid on every transaction, in every hop during payment routing, is reallocated by "multi-hop debt reduction". (whitepaper) The example has a 4% tax-rate. Me is paying You 1000 XYZ, plus taxes, and the total payment is therefore 1000/(1-taxRate)^2 ≈ 1085. The debt is reduced, "burnt", a bit similar to Silvio Gesell's notion of "decaying currency". It's a social safety net, when you lack an "income", no credit lines to you, you only receive. Why is based on theory around universal basic income and how it integrates with human psychology, Maslow's hierarchy of needs. The "risk reduction" also means the network as a whole takes on some of the financial risk of trusting people up to basic needs.

[email]

probably better to calculate amount with payment(taxRate + 1)^(1+intermediaries) instead, like you assumed. here is the intermediary step in that payment. the credit line for the payment also propagates tax, more generic in cases where Sally has no other credit lines to her.

the overall idea is that the "pulse" that is propagated decreases with number of credit lines it splits into with similar factor that number of people reached increases, so result is more or less homogenous medium.

[email]

a GIF, also here if attachment does not load. overall idea that while "pulses" split and decrease in amount, they also converge with other "pulses", and the resulting medium is homogenous if every person has on average same number of credit lines. when a person has no "income", they only receive, universal basic income, lifts people up Maslow's hierarchy of needs.

note, "pulses" also "converge" on transaction processing level, agent-centric, people decide when to "propagate" themselves.

[email]

I made an animation that shows every step in tax reallocation. If attachment does not load, uploaded here. In the example, Dave has in total received 26 XYZ in basic income at the end of the animation. Whenever you lack an "income", you only receive, the system then provides you with unconditional basic income. Have explained it as simple as I could on http://whitepaper.resilience.me.

[email]

added a rule to the whitepaper on http://whitepaper.resilience.me and an animation that shows it in use, https://zenodo.org/record/3240196/files/propagation.gif

it prevents an attack vector.

now 435 downloads of whitepaper since may 22nd

[cojulapa]

Hi, 

thanks for the effort you put into the gifs. it definitely helped, just in the last one a lot of transactions are going on after each other... it is hard to understand which is a new transaction triggering a pulse and what is just the current status of the balance.

Anyway, some thoughts come up on my side:

I like the idea that people can decide themselve whether to propagate or not. (Otherwise I see the possibility that one could misuse this mechanism with pseudo transactions back and forth between two nodes to cancel debt of those who overspent ). 

But with the voluntary aspect your tax has more the characteristic of a donation recomendation, like: when I spend some money it is "moral" to give the amount given by your formular to the "poor"

But the other issue I am wondering is that your debt reductions only reaches the nodes I have debt with. Considering the ripple idea these are nodes I trusted  (probably because they are responsible and have enough they could give back) therefore I am wondering if in a real world scenario this pulse thing reaches the right people in the right amount...  I assume that the poor are probably seperated from the rich, hence the pulses are decayed once they reach them.

So for me the effect is doubtfull and the incentive is simply good will as I already wrote. Plausible for anybody?

[email]

re: hard to understand which is a new transaction triggering,

it is pretty easy to see, the balances shown can only be the result of one thing. the 4th and 5th transaction is Frank to Bob via Alice, 200 XYZ (at 4% tax rate like in the example as a whole), the 6th shows credit clearing (just to demonstrate underlying Ripple protocol), and the 7th and 8th are from Erin to Carol via Alice, 300 XYZ, showing credit clearing as well.

re: misuse this mechanism with pseudo transactions back and forth between two nodes,

the tax "hops" from person-to-person, and any interaction is only ever between people that trust one another. have not seen any way to attack it.

re: debt reductions only reaches the nodes I have debt with,

they then propagate another "hop" from those people, and so on. whenever a person lacks an "income", they are only receiving, otherwise propagating

re: incentive, 

incentive is ultimately a social safety net that removes poverty. there is a mechanism for decentralized regulation of tax-rates, not mentioned in the whitepaper, the whitepaper only explains the propagation

[email]

A very simple way to explain Resilience: the tax "hops" from person to person, like data on the internet hops between servers to reach you, or how payments in Ripple hop between people who trust one another. Resilience, since last year and the new design, also uses "multi-hop" as a design pattern that is an organic way to scale networks. Whenever a person lacks an "income", they are only receiving (otherwise propagating. )

[email]

some concepts for the tax regulation. how to fit it into the system is different now with the "multi-hop" tax reallocation, this was a first test, https://i.imgur.com/CLDuqjV.gif

[email]

Another way to describe Resilience, multi-hop tax reallocation in Ripple for guaranteed basic income. The tax "hops" from person to person until it finds a person without an income, using credit lines in the same way blood uses blood vessels, or electricity uses electrical wires. Scales organically, and to infinite size.

http://whitepaper.resilience.me

[email]

This was the selection system for tax-rates that I had in mind 7 years ago when I reached out to this group. Very simple. Each person has a "trust index". They can adjust it at any time. The lowest trust index of two people is always selected for. Propagation is in proportion to "width" of credit line, the tax-rate that was used. Meant as a coordination system that lets people "think" together about what tax-rate to use, imitating one another based on what works well for sustaining their network with guaranteed basic income.

[email]

updated the abstract on http://whitepaper.resilience.me, based on ways of attempting to explain Resilience a bit more comprehensive

[email]

an assumption I make is that there will be at any time at least a few credit lines per person, so that tax can be redistributed via them

[cojulapa]

Meant as a coordination system that lets people "think" together about what tax-rate to use, imitating one another based on what works well for sustaining their network with guaranteed basic income.

As you wrote that people are free to propagate or not I don't see that this income can be guaranteed. It simply depends on wether people around you are willing to give. Or if they see the necessity to donate when they make purchases.

 

re: misuse this mechanism with pseudo transactions back and forth between two nodes,

the tax "hops" from person-to-person, and any interaction is only ever between people that trust one another. have not seen any way to attack it.

In case when it is cumpulsory to propagate and pay this UBI tax , twos node could constantly trigger this debt decaying mechanism. It would work if it would cause all debt lines to decay. but I think this is not the case. As the idea is someone who receives a payment should forward some of the income to its debtors (hence lowering its credit), but not the other way round when he is a debtor on its own and receives a payment and the mechanism would also decreade the debt then two people could group togehter doing fake transactions to cancle their debts. 

 

re: debt reductions only reaches the nodes I have debt with,

they then propagate another "hop" from those people, and so on. whenever a person lacks an "income", they are only receiving, otherwise propagating

That is what I meant that this machanism will not reach the poor in the sense that they receive money they can use somewhere they get something from. Considering that in ripple one should just connect to trusted close connections it is likely that different groups in the community will form regions in the network. Meaning this mechanism will only cancle the debt between poor people and the debt between the rich.

 

re: incentive, 

incentive is ultimately a social safety net that removes poverty. there is a mechanism for decentralized regulation of tax-rates, not mentioned in the whitepaper, the whitepaper only explains the propagation

I thought the tax-rates can be set by each node itself. Unfortunately, if  providing "a social safety net that removes poverty" would be a strong incentive we would not have a lot of problems on our planet. 

Nevertheless, I think that the ripple concept inherently provides an incentive to transfer money to those not so well off. And this is risk redistribution. Imagine a node that serves more than he consumes. when only using one trusted connection its debt torwards him will increas steadily, maybe to a level where he starts to feel uncomfortable, having to face a large loss  when this node (due to some circumstances) would default. The way out is to distribute this risk. This can be done when he alows others to consume over his node ( the large amount would be used partially by the nodes who can need it), in essence giving them credit. so instead of one node owing him a large sum, he would end up with many nodes owing him a little sum. It is the trade of between having one large but well judgeable risk vs. having many small not so severe but not that certain risk. In ripple it would also mean that one would broaden the range where he can pay. As having credit in different places. 

this risk issue is the thing why your mechanism makes no sense to me. I have two peope owing me 10. If a third person pays me something she has to pay me the amount plus the tax. This tax I forward to the two owing people setting down their debts. 

So A buys something for 100 with me having two debtors already

Normal status without tax

A -100-> me <-10- C

                     <-10- D

Me Sum Account: 100 +10 +10 = 120

-----------------------------------------------------

With your proposal:

A -(100+tax)-> me  <-(10-tax/2)- C

                                <-(10-tax/2)- D

with tax:4

A -104-> me <-8- C

                     <-8- D

My Sum Account :  104+8+8= 120

So for me it makes no difference in terms of account balance, the cost is carried by A who bought something. But in terms of risk it makes a difference. It works against the idea of diversification....

hope my concerns are somewhat understandable.

[email]

Resilience is two mechanisms, that combined produce what I see as mass-scale redistribution of wealth. Ripple is also two mechanisms, the payment routing via trust lines, and credit clearing when loops form. So, I have to communicate 4 mechanisms at once when explaining Resilience, that is a bit of work.

re: As you wrote that people are free to propagate or not, that taxes "hop" is how they are redistributed. To propagate tax a "hop" does not cost anything other then that computation, appending a transaction to a ledger that encodes the "hop".

re: It simply depends on wether people around you are willing to give, yes, just like any welfare system (previous tax systems use coercion but I grew up in Sweden and a lot of people there _want_ to have their welfare system, including paying taxes).

re: Or if they see the necessity to donate when they make purchases, people propagate in proportion to the tax they pay. That is the second mechanism of Resilience, the "trust index". If you pay 0% tax you will not relay any tax, the system routes around you. People "compete" to divert resources to their trusted peers.

re: Meaning this mechanism will only cancle the debt between poor people and the debt between the rich, that assumes the credit limits of people will be identical to credit limits in fiat system, with very large rich-poor divide. in a perfect market with perfect social coordination, there would be fewer super rich people and fewer super poor, fewer billionaires but still many millionaires.

re: then two people could group togehter doing fake transactions to cancle their debts, the "multi-hop" reallocation mechanism, the first mechanism of Resilience, means that redistribution is only between trusted social relationships. If you make fake transactions back and forth, you either share a lot of tax to the network (in case there is a significant web of people accessible from you via credit lines), or, you just make fake transactions back and forth as 2 people, isolated from anyone else.

re: Considering that in ripple one should just connect to trusted close connections, and in Ripple do so over multi-hop, via trust lines. the assumption Resilience makes is that there will at any time be enough credit lines open between people so that there can be mass-scale redistribution of tax.

re: I thought the tax-rates can be set by each node itself, yes, with "trust index". people propagate in proportion to tax-rate used, imprinted on credit line, and "compete" to divert tax in the direction of their trusted peers. if you pay 0% tax, you are simply bypassed by all tax.

re: if  providing "a social safety net that removes poverty" would be a strong incentive we would not have a lot of problems on our planet, yes there would be less problems with Resilience if assumption that credit lines provide sufficient "web" for redistribution is correct.

[cojulapa]

re: It simply depends on wether people around you are willing to give, yes, just like any welfare system (previous tax systems use coercion but I grew up in Sweden and a lot of people there _want_ to have their welfare system, including paying taxes).

Why do you want to implement it in this way then? Which just decreases the existing debt. When I understood correctly.

 

in a perfect market with perfect social coordination, there would be fewer super rich people and fewer super poor, fewer billionaires but still many millionaires.

So you argue in this perfect scenario it would work, but the mechanism is not able to lead to this perfect scenerio in my eyes.

 

re: Considering that in ripple one should just connect to trusted close connections, and in Ripple do so over multi-hop, via trust lines. the assumption Resilience makes is that there will at any time be enough credit lines open between people so that there can be mass-scale redistribution of tax.

But the tax does decrease (by splitting) farther from the origin, right?

 

yes there would be less problems with Resilience if assumption that credit lines provide sufficient "web" for redistribution is correct.

I understand that you claim that with your redistribution (in case it reaches the poor enough) there will be less problems. No doubt it cancels the debt of those who have built up some. Indeed it is like demurrage money just that anybody can decide to let it decrease or not. Although in your case it does not decrease with time, but with transactions of nearby nodes.

What I was asking was that creating some mechanism to give from rich to poor, or introduce demurage money is not the big deal, you could do this in the current system, but there is certain resistance from the rich (in case of demurrage also from the poor if it is applied independent of the hight of the stored money). So what is your argument that this redistribution you propose is better accepted?

[email]

re: Why do you want to implement it in this way then? I am for non-violence, it scales better, it is more secure because it is more decentralized, it has no need for any borders or anything like that, making it work better overall in the digital age.

re: So you argue in this perfect scenario it would work, no I mean that trust is more distributed, money being "artificial trust", a technology to represent trust. people will not connect in extremely centralized hierarchies (fewer billionaires but still lots of millionaires probably). it was a way of saying I don't think there will be trust silos with only rich people and then only poor people, not how I see Ripple work.

re: But the tax does decrease (by splitting) farther from the origin, right? yes, and "packages" of tax at the same time increase in frequency with same factor as amount decreases. detailed in whitepaper.

re: I understand that you claim that with your redistribution (in case it reaches the poor enough) there will be less problems, that was in reply to your comment that "if providing "a social safety net that removes poverty" would be a strong incentive we would not have a lot of problems on our planet.", I meant that you also need to factor in technological innovation. if having computers was a strong incentive, there still would not magically be computers in the stone age, the technology that facilitated that incentive had to be developed.

re: So what is your argument that this redistribution you propose is better accepted?, like you say redistribution can be built in to the current system, it actually already is and it is called taxes. with Resilience, you have a more decentralized system that scales better, no central point of control at all, no bottlenecks, no need for arbitrary rigid trust boundaries that make exchanges across those difficult. computationally easy to process. works well in the information age. expands on Ripple that is a brilliant invention and 15 years old.

[cojulapa]

first of all, it would be super helpfull if you use the comment function which puts the things you comment on in grey. 

thanks :)

 

I mean that trust is more distributed, money being "artificial trust", a technology to represent trust. people will not connect in extremely centralized hierarchies (fewer billionaires but still lots of millionaires probably). it was a way of saying I don't think there will be trust silos with only rich people and then only poor people, not how I see Ripple work.

Well , i think that we live in quite social bubbles. having most of our contacts in the same level of the society... 

As I wrote once I see an incentive to broaden the contacts you trust in rupple. 

How do you think can a ripple debt connecation build up between a well situated person somebody from a lower level in society? 

tax does decrease (by splitting) farther from the origin,and "packages" of tax at the same time increase in frequency with same factor as amount decreases. detailed in whitepaper.

Under the assumtion everybody is propagating? did you simulate this already ? I think you wrote that they also stop under a certain value. In a true established ripple sytem I assume that someone has over 100+ contacts, so such a 4% tax wich pretty quickly decay under a non relevant level.

 

re: I understand that you claim that with your redistribution (in case it reaches the poor enough) there will be less problems, that was in reply to your comment that "if providing "a social safety net that removes poverty" would be a strong incentive we would not have a lot of problems on our planet.", I meant that you also need to factor in technological innovation. if having computers was a strong incentive, there still would not magically be computers in the stone age, the technology that facilitated that incentive had to be developed.

 

re: So what is your argument that this redistribution you propose is better accepted?, like you say redistribution can be built in to the current system, it actually already is and it is called taxes. with Resilience, you have a more decentralized system that scales better, no central point of control at all, no bottlenecks, no need for arbitrary rigid trust boundaries that make exchanges across those difficult. computationally easy to process. works well in the information age. expands on Ripple that is a brilliant invention and 15 years old.

I don't really see how this technological invention would give me a better incentive to give (pay my taxes to support social stability) 

1st because it is not ensured that all pay it (at least as i understood, could be you mentioned once that those who will not pay will have a lower priority in routing payments?)

of course you can play a nice guy strategy, but this is risky in a way when you check out game theory

2nd if i decide to pay i actually just can control who is reached in one level (my trust contacts), if this goes on and does any good, I don't know...

(in contrary to simply donating to whatever NGO, or private person I want )

I don't see that the tax systems problem is a technical one, I think it is that nobody wants to pay, everybody always think they pay too much...

 

[email]

re: How [...] ripple debt connecation [...] well situated person somebody from a lower level in society?

social stratification is a phenomena of dominance hierarchy based social organization, master-slave type social organization. with P2P systems like Ripple, there are not really social strata. Ripple connects people in a network, not a hierarchy. since Resilience offloads some risk onto the collective (assuming it works, mainly assuming credit lines will have enough connections at any given time to do mass-scale redistribution), it decreases the need for hierarchical trust even more. 

re: Under the assumtion everybody is propagating

no tax in general, in the protocol, decreases (by splitting) farther from the origin, and "packages" of tax at the same time increase in frequency with same factor as amount decreases. detailed in whitepaper.

re: I don't really see how this technological invention would give me a better incentive to give (pay my taxes to support social stability).

it is based on social relationships, so you only ever give to people you actually trust. they in turn give to people they trust. reallocation propagates similar to data in TCP/IP hopping over relayers, or transactions in Ripple hopping along relationships of trust.

re: 1st because it is not ensured that all pay it

the "trust index" mechanism means that if you pay 0% tax, you are bypassed by all reallocation. detailed in whitepaper.

re: of course you can play a nice guy strategy, but this is risky in a way when you check out game theory

it is based on social relationships of trust. you would play a nice guy to people you trust, and have a social relationship to. the game theory is at a person-to-person level.

re: 2nd if i decide to pay i actually just can control who is reached in one level

yes, or, no. when you pay tax, it is reallocated from the person you transacted to (including intermediaries). when you act as "relayer", your only ability to control at all is one level, yes.

re: if this goes on and does any good, I don't know...

that is up to the people you trust, with one degree of separation. based on how social relationships work, you do have some knowledge.

re: I don't see that the tax systems problem is a technical one, I think it is that nobody wants to pay, everybody always think they pay too much...

Resilience is an evolution of taxation, just like the internet was an evolution of communication technology, or Ripple an evolution of money. lots of people who like Ripple don't like banks, although both are monetary systems to scale banks. taxation in Resilience is very different from national taxation or monarchy based taxation, but it is still taxation and mass-scale reallocation, if credit lines turn out to work well for reallocation.

[email]

*although both are monetary systems to scale trust

[email]

cojulapa, this here is the core of Resilience, taken from the whitepaper. I invented the mechanism in January 2013, 6 years ago. It was difficult to explain because 1) people did not understand Ripple, 2) people do not understand the internet they just use it, and 3) people hate taxes and 4) hard to know exactly where to start. the "trust index" is the game theoretical foundation of the protocol.



when you set a trust index of 0%, you are just bypassed. you can use Ripple + Resilience and have it operate just as if you were using Ripple only. tax in Resilience is non-coerced, voluntary, the first voluntary tax system.

[cojulapa]

Thanks a lot for clarifying !

I now understood that you wont receive if you dont give. But I still can make normal transactions. So there is no pressure to pay the resilience tax as well. Which I actually like to be honest. 

 

happy to hear that you also think that 3) people hate taxes. And I agree on the other points as well :)

However there are some things which are counterintuitive to me

social stratification is a phenomena of dominance hierarchy based social organization, master-slave type social organization. with P2P systems like Ripple, there are not really social strata. Ripple connects people in a network, not a hierarchy.

I think starting from our current social networks there is a strong level clustering in these networks. Espcially considering that you would only make connections which you trust. So maybe relatives, university collegues, work mates.... all having similar status, in my  assumption.

since Resilience offloads some risk onto the collective (assuming it works, mainly assuming credit lines will have enough connections at any given time to do mass-scale redistribution), it decreases the need for hierarchical trust even more. 

Which risk do you mean? I guess the one of maintaining a live standard. But what I am wondering is that the tax just reduces already established credit lines. right? So it only reduced the debt I have built up. The protocol of my expenditures. To get this dept somebody must have given something to me beforehand. Just based on trust. For my understanding it is not that they get something for which they can go and buy something. 

Why it does not reduce risk of the one holding the "money" but on the contrary clusteres it to one point I already wrote...

no tax in general, in the protocol, decreases (by splitting) farther from the origin, and "packages" of tax at the same time increase in frequency with same factor as amount decreases. detailed in whitepaper.

The frequency over all increases. But not the frequency of payment of somebody receiving a smaller and smaller payment. 

re: I don't really see how this technological invention would give me a better incentive to give (pay my taxes to support social stability).

it is based on social relationships, so you only ever give to people you actually trust. they in turn give to people they trust.

 The thing again is the credit line just exists because somebody consumed and payed with the trust. Keeping track of how much they own. So when I reduce with the tax the debts, for me its makes no sense. I should have charged less right in the beginning? Why do I track the debts (dependencies) at all if I just let reduce them by some mechanism?

 

I also mean that in your system it is not assured that the tax ends there where it might be needed (families with disabled children, ...) In most current taxation systems such circumstances are accounted for. 

Resilience is an evolution of taxation, just like the internet was an evolution of communication technology, or Ripple an evolution of money. lots of people who like Ripple don't like banks, although both are monetary systems to scale trust. taxation in Resilience is very different from national taxation or monarchy based taxation, but it is still taxation and mass-scale reallocation, if credit lines turn out to work well for reallocation.

Agree but the evolution needs to be better to outlive. It needs to bring a benefit to what was there. For me yet this is hard to find in the resilience idea compared to taxation. But that is just my view.

[email]

re: happy to hear that you also think that 3) people hate taxes.

It is an observation that has been difficult to not make since I have invented an evolution of taxation. I don't really hate taxes, I just saw the system as incredibly outdated, so I looked for ways to improve it.

So there is no pressure to pay the resilience tax as well. Which I actually like to be honest. 

That was an ambition when I invented it. I wanted the control to be entirely in the hands of social relationships, so that it is non-coercive.

re: I think starting from our current social networks

It would replace current systems. Usually, status quo bias is that we imagine future organization based on the present (prejudice), once people can transact and provide a social safety net for one another with Ripple + Resilience + person-to-person ledger, no one will prefer older systems. Banks were once an innovation just like Ripple is.

Which risk do you mean?

People paying back their debt. Resilience offloads the risk of trusting people up to basic needs, to a collective.

re: To get this dept somebody must have given something to me beforehand

No you can issue IOUs in Ripple without having any IOUs issued to you at the moment, issuing IOUs is only based on credit limit (trust lines) from other people.

re: The frequency over all increases. But not the frequency of payment of somebody receiving a smaller and smaller payment. 

the point is that there is a homogenic field, as tax splits into amounts that approach zero, the number of "packages" increases with same factor, total amount is a homogenic field. detailed in whitepaper http://whitepaper.resilience.me

re: So when I reduce with the tax the debts, for me its makes no sense. I should have charged less right in the beginning?

You only keep tax if you lack an income, otherwise you act as a relayer, propagating it. The tax pool reaches people who lack an income, and acts as guaranteed basic income.

re: I also mean that in your system it is not assured that the tax ends there where it might be needed 

It is assured that it reaches people without income. Guaranteed basic income is an old concept, I came across it in 2012 after pausing med. school in 2010 because I considered society to be causing disease.

re: Agree but the evolution needs to be better to outlive.

Benefits are similar to the benefits of moving from banks to Ryan Fugger's Ripple. All control is delegated to social relationships, person-to-person, which makes it impossible to abuse centralized control. The system scales better, because if offloads all information processing onto smaller, self-organizing networks of people. The taxation requires no coercion, regulation of tax-rates is delegated to social relationships, impossible there as well too abuse centralized control.

[cojulapa]

 

Which risk do you mean?

People paying back their debt.

Well this risk is lowered, simply because I reduce the amount I want to get back by your tax.

 

Resilience offloads the risk of trusting people up to basic needs, to a collective.

Sorry but I can't see how you mean that. 

 

re: To get this dept somebody must have given something to me beforehand

No you can issue IOUs in Ripple without having any IOUs issued to you at the moment, issuing IOUs is only based on credit limit (trust lines) from other people.

If I got things right, for every connection in ripple you have a credit limit and a balance. 

the limit stating how much you are ok with, to give the other credit, and the balance what is actually the status (who owes whom how much)

That the tax reduces the credit limit makes no sense, it is what I set I can accept, just to enable any payment at all.  The tax can only modify the balance IMO. 

But the balance just exists due to a transaction. Which usually comes with some transfer of good or service. Of course one can give the other money for nothing and then the taxt would reduce that but then it would have no real impact in the real world... on these two people. It would really just be counting up and down digital numbers...

Thinking like this makes it visible that debt is not the problem... it enables the other to pay

re: So when I reduce with the tax the debts, for me its makes no sense. I should have charged less right in the beginning?

You only keep tax if you lack an income, otherwise you act as a relayer, propagating it. The tax pool reaches people who lack an income, and acts as guaranteed basic income.

With relaying I have the problem that it might center my risk. at least this was the case in one of your examples.

It can not work as guaranteed basic income. As it simply depends on the people willing to give (this will might stop arbitrarily) and you also can't control the height of this income as the thing is triggered by transactions. 

As i already wrote I think that these two ideas are good (free decision to give but give some dependency on how much you consume, so that people can have a relation to an amount what it social to give), just that you can not state that the income will be guaranteed and also the heigth of it.

 

re: I also mean that in your system it is not assured that the tax ends there where it might be needed 

It is assured that it reaches people without income. 

It reaches people with debt I think. But it can not reach somebody who has no "money" but no debt either. Who was not yet trusted by anybody. At least as you have it in mind up to now. 

 

 

Benefits are similar to the benefits of moving from banks to Ryan Fugger's Ripple. All control is delegated to social relationships, person-to-person, which makes it impossible to abuse centralized control. The system scales better, because if offloads all information processing onto smaller, self-organizing networks of people. 

The taxation requires no coercion, 

Really liked the part you wrote here, it is also why I am in favour of a network money. although in the last part I would substitute taxation with giving a loan. 

 

 

[email]

re: Well this risk is lowered, simply because 

It is lowered in that life is unpredictable. If you can have a guarantee that the web-of-trust itself chips in when people fall below basic needs, then that offloads some of the risk of trusting people with credit, and it makes for a more relaxed and open society, where people know that everyone is at least above poverty and therefore reliable in ways that people in poverty are not.

re: Sorry but I can't see how you mean that

see above

re: That the tax reduces the credit limit makes no sense

because it does not, it reduces credit, IOUs, credit line in Ripple protocol, not the credit limit (trust line in Ripple protocol)

re: It can not work as guaranteed basic income. As it simply depends on the people willing to give

It depends on people willing to give yes, in the context of the rules dictated by the protocol, tapping into altruistic behavioural drives in narrow confines where people have some level of control, so not "pathological altruism", as in just having everything stolen from you.

re: It reaches people with debt I think

tax reaches everyone with debt, IOUs, but it only stays with people who have no income, everyone else propagates, dictated by the rules in the protocol and triggered in an "agent-centric" way (to borrow word from Holochain project)

re: although in the last part I would substitute taxation with giving a loan

Ripple is based on giving loans, that is what IOUs are. Resilience is not, it is built on top of Ripple, and it taxes a small amount on each transaction (including every hop), and reallocates it in a way that is equivalent to centralized wealth redistribution in a nation-state, but without any coercion, and without ever passing through a central point. it is horizontal, not vertical.

[email]

I made a simplification of Resilience, now it is reduced to a single rule: credit lines conduct tax in proportion to tax-rates people choose to use when they make payments. This rule also defines that when a person lacks an “income”, has no incoming credit lines, they only receive, the system provides them with guaranteed basic income. https://telegra.ph/Resilience-a-horizontal-wealth-redistribution-mechanism-for-guaranteed-basic-income-10-17-2

[cojulapa]

I would like to know what you mean by making transaction links conductive. The tax from my perspective just reached my trusted nodes, right? as least as you propose it now. 

Taxes are enforced by the imperative to care for people around you, altruism. Incentive is that paying tax makes your transaction links “conductive”, and you compete to divert tax flow to your community.

[email]

It's the basis of the Resilience protocol, credit lines gain "bandwidth" for transporting taxes, much like trust lines are "bandwidth" for routing payments. Tax that reaches you will "hop" to those who have credit lines to you (and then hop further beyond that. )

New article, very concise: https://www.scribd.com/document/434931569/Resilience-a-Peer-To-peer-Wealth-Redistribution-System

[cojulapa]

Hi, 

many other issues around so I read your paper to get into the topic again. 

One thing I think I pointed out already, I cant see how you can claim that you have a guaranteed basic income. As you emphasize that payment of the tax is voluntarily and that it also depends on the amount of transactions and to whom somebody would be connected. (close to nodes which have the tax mechanism active and which buy a lot one will generate a larger "social security income " than somebody who is in a region where less transactions are made and the peers decided not to pay the tax) Am i right with this?

On Saturday, November 23, 2019 at 8:50:34 PM UTC+1, cojulapa wrote:

I would like to know what you mean by making transaction links conductive. The tax from my perspective just reached my trusted nodes, right? as least as you propose it now. 

Taxes are enforced by the imperative to care for people around you, altruism. Incentive is that paying tax makes your transaction links “conductive”, and you compete to divert tax flow to your community.

By saying "makes transaction links  condutive" do you mean:

- that you establish links to people (giving credit) to which you yet did not have a connection too 

or do you mean 

-that you reduce the balances of connections you have?

[email]

It's "guaranteed" in the sense that you only get it when you lack an income, contrasted to "universal basic income" that everyone gets. (I happen to have a second project, built on a coin (centralized currency, not mutual credit), and I wrote this taxation mechanism for it that I plan to use for universal basic income. The proof-of-personhood I intend to use with it was mentioned in Bloomberg here. )

So you are right that the tax pool even existing is not guaranteed, I used "guaranteed basic income" in the technical sense of the term only.

Why I think Resilience could distribute whatever people chose to pay in tax quite evenly, trust is a scarce resource, and Dunbar's number is a thing. The same basis as for Ripple overall. Resilience is to Ripple what email was to the internet, an application on top of it. So, you are right that how much tax you convey is based on your connections, but, I think there are aspects of the human condition that will tend to evenly distribute trust, when it is possible, and Ripple makes it possible.

With conductive, I mean that credit lines in Ripple have an added "bandwidth" for conveying tax. I called the parameter for that "trust index", an ode to Ryan's "trust lines", the more tax you paid with a credit line, the more "bandwidth" it will have. This section here explains it pretty well. Think of it as a social norm, an agreement, people agree that if we follow these rules, we're all better for it. It was inspired by the golden rule, my parents are Christian (I'm not, but took their moral to me. )

That rule means that people who hate tax and don't want to pay it, can still use the money system, they'll just be bypassed, without any conflict at all. The "conductivity" is equivalent to how electricity through wires behaves, or, water through pipe system, blood through vascular system.