Skin in the Game

Business investors take special care of the possibility of losing their money on a bad investment. When they’re wrong about a hunch (a prediction), they can lose whatever they put into it. When it is someone else’s money, people are not as prudent.  If a failure will hurt, it is referred to as having skin in the game. Without skin in the game, people can and will do stupid things without having to pay for their personal failure.

It occurred to me today that it is possible for Sapiocracy propositions to be structured such that voters must have skin in the game.  Imagine a proposition that, if it fails, will end up costing a lot of money to clean up.  In all current systems, this cost is borne by society through increased taxes or fees.)

Sapiocracy can change this because it permanently records how each person votes. Why not charge those who voted for a failed proposition for the damage it caused? The system can figure out the exact amount each voter owes based on the number of people who voted for the proposition and also survived until failure was determined. The amounts to be paid back can also be adjusted in case some of the voters cannot pay their fair share, making those with more resources wary of the voting biases of the poor. This is simple enough and might well make voters a bit more wary of voting irresponsibly.

Different variations of this are possible. Consider a punishment/reward system: Imagine voters in favor of the new proposition must put up money (have an increased tax burden perhaps) immediately by an estimated amount to fund the proposed implementation at no cost to those not in favor. If the proposition fails, the damage will have already been paid for (quite fairly, I might add.) This is as if the investors (voters) lost their investment in the new proposition. This kind of put-your-money-where-your-mouth-is proposition might reward those in favor in the form of tax offsets – those in favor get a tax reduction and those opposed get a tax increase. The idea of changing taxes based on predictions initially sounds horrific, probably because it is a new, foreign idea. After all, how is one to know the outcome? But why should we not be held responsible for our actions? Is this not the very definition of responsibility? When people cause damage, they should have to pay society for it. When people cause improvement, should society not reward them? It seems to me this is quite equitable.

As an aside, Sapiocracy includes voting records (as it must), but it can also easily be tied to the taxation infrastructure and even money accounts and basic banking functions (public ATMs, etc.) With these changes, a huge portion of western society’s corruption would be eliminated. The banking structure could be completely restructured (which is arguably long overdue anyway) and efficiencies never seen before can be realized. With these changes, the above suggestion would have almost no extra cost to implement because all of the accounting can be built-in to the system and be automated.

Each of these ideas is relatively easy to implement and codify. Food for thought.



2 thoughts on “Skin in the Game

  • BananasFoster says:

    So you could essentially become rich if your predictions are correct and poor if you are wrong?

    • sapioplex says:

      Interesting way to look at it. I don’t think it could become that extreme in any practical sense. It seems to me very unlikely that any proposition that could put extreme financial pressure on the population would be passed by the wise – remember, the wise end up with most of the voting weight in Sapiocracy.

      On the other hand, if a voter had very little money and kept voting terribly on measures that were done this way, then yes, their tax overhead could put more pressure on them.

      Overall, I don’t think this would be an issue at all. Taxes under Sapiocracy would probably end up being much lower than taxes in any other form of governance (for lots of reasons.) They’d almost definitely be a small part of one’s income, even with a voter who continually made bad choices. Oh…and by the way…making bad choices like that would probably lead to educating the voter to do better, which is a good thing.

      Could you post something about this in the forum? It might lead to a good discussion.

Leave a Reply

Your email address will not be published. Required fields are marked *