Tag: Positive liberty

A suggestion for a solution to the Palestinian issue

Establishing a viable Palestinian state would seem to be at least technically feasible. It is, of course, fairly apparent that doing so would be rather challenging, particularly politically, of course, and given the complexity of the political process aspect of the issue, for now it seems best to focus mostly on what it would take to create the foundations of a viable Palestinian state rather than on how exactly to make it happen politically, and it would also seem reasonable to avoid going deep into the details concerning the solution itself in this post.

The history of the region is obviously fairly complex, and as such it would seem sensible to also not discuss it any more than absolutely necessary in this context in order to avoid going off the main topic.

The territory of the new Palestinian state should be contiguous. The region in question should be divided roughly into two halves, and it seems like an at least somewhat sensible compromise to make the border between them a reasonable line of some kind running from the Mediterranean to the Dead Sea north of Ashdod and Kiryat Gat and south of Jerusalem, all things considered, with the southern half naturally becoming the territory of the new Palestinian state.
The Palestinian state should, of course, also have a robust constitution, and the fledgling state should naturally be closely supervised and guided, preferably by a European body of some kind.
The state should naturally also have a reasonable security policy and a sound economic system with a clear focus on positive liberty. Creating economic opportunities for the Palestinians is, of course, critically important from a security point of view too, since they must have a fairly positive outlook in order for the extremism among them to slowly fade away.
Establishing an education system capable of providing high-quality education is obviously a priority as well.
The tax system should, of course, be fairly simple and relatively easily enforceable, and the euro could perhaps be used as an interim currency.
There naturally should also be a decent social security system without incentive traps, and healthcare charges should be fairly small.

Energy security is, of course, very important as well, and it seems that a combination of at least solar power, pumped storage, and hydrogen storage (naturally in tandem with fuel cells) seems like a feasible basis for a fairly dependable electricity sector. Local related manufacturing should naturally be fostered and the domestic energy market should become competitive as soon as possible in order to drive electricity costs down fairly quickly.
An ample supply of electricity would, of course, also allow for a dependable supply of desalinated water, which would naturally also help with food security.

The new Palestinian state should naturally receive a substantial amount of aid in order to help set it up, but the proportion of financial aid of all of the aid should be as small as possible in order to avoid fostering corruption and long-term financial dependence as well as reasonably possible, and the vast majority of the aid should thus be provided mostly as goods and services, with a particular focus on quality education, of course.
The state should also be given military assistance by an at least mostly European force. Training police and military personnel should naturally be a high priority too.
Establishing full sovereignty over all of the de jure territory of the new state should be left to be the responsibility of the new local armed forces, and the military assistance should become peacekeeping as soon as reasonably possible.

This kind of a solution would obviously have a very significant economic impact on the Jews of the region, but this would seem like a justifiable compromise, as it seems rather reasonable to see the Jews as owing the Palestinians a lot.
The Jewish state could perhaps use its power of expropriation to purchase land and buildings within the territory to be handed over to the Palestinians, and it could then pass the property to an international holding body overseen by the states supervising the new Palestinian state, and if this is done, the property should then be passed to Palestinian ownership as soon as reasonably possible: avoiding corruption in the process as much as possible is obviously very important.
The Jews’ legitimate security concerns regarding all of this should, of course, be acknowledged as such, but it seems obvious that an arrangement like this would also make some security work considerably simpler for them. Both the new Palestinian state and the Jewish state should naturally have to formally recognize each other as legitimate and renounce all claims to each others’ territory for good in a treaty. The treaty should, of course, also specify the total amount of reparations to be paid by the Jews and make it clear that the Jews do not owe Palestinians any per se reparations in excess of what is specified in the treaty.

Economic and social development in Palestine and increased trade between Jews and Palestinians should help considerably in maintaining and reinforcing peace between the two peoples, and it seems plausible that the vast majorities of the peoples of both countries might come to fully accept the new status quo in a generation or two and that the arrangement would prove to be mutually beneficial for them in the long term.

Economic policy suggestions

From a prosocial perspective, it seems eminently reasonable to seek to foster a healthier economy in the society in question, and one way to do this would, of course, be to increase the average efficiency of the economic actors in that society, and given that worker co-operatives are apparently on average not only the most efficient corporations but also the most resilient, keeping the aforementioned perspective it would seem particularly rational to enact policies that would increase such co-operatives’ proportion of the economy. From the same point of view it seems very sensible to also make the establishment of not only innovative limited companies but limited companies in general as uncomplicated as reasonably possible and to give inventive employees healthier incentives.

It seems that a substantial increase in the proportion of worker co-operatives could be achieved by establishing a number of state funding agencies that would finance especially the founding stages of worker co-operatives bound by a certain legally fixed set of rules. Co-operatives like this could be called employees’ corporations, for example, and I’ll use this term for this type of co-operative at least for now.
The agencies should also fund conversions of existing businesses into employees’ corporations through buyouts. They should fund innovative limited companies as well, especially in the founding stages, since a limited company seems quite likely to be the most suitable form of corporation for a primarily innovator-driven business. They should, of course, be able to fund less innovative limited companies too. They should also be allowed to fund more conventional transfers of limited company ownership. It should, of course, be possible to found employees’ corporations with private funding as well.

The agencies should be able to have both solo investors and investment teams, and the investors and the members of the investment teams should naturally have a legally mandated non-disclosure duty, and provided that the state has a fairly solid reputation for consistently enforcing the rule of law, this would obviously make it possible for people to simply get in touch with investors and investment teams and discuss their business plans without having to worry too much about their ideas getting stolen.
Even if the state has a good reputation, there should probably also be a standing recommendation for people to make sufficient records of their communication with the investors and the investment teams, just in case.

The investors and the members of the investment teams should have relatively modest base salaries, but each solo investor and investment team should naturally also get a share of the net profits they generate for the agencies. They should also get automatically dismissed if their ”accounts” are in the negative for too long, and the amounts they are in the negative and the potentials of their investments should be taken into consideration when determining the length of time that qualifies as too long, but there should be an algorithm that would take a general economic downturn into consideration when their performance would be automatically evaluated so that the dismissal of sufficiently competent people could be avoided. Dismissed investors should, however, get their share of the net profits their investments might ultimately end up generating; if another investor or investment team working for the agency or some other agency takes over a case by investing more into the corporation in question, how much each investor and investment team gets paid should be proportional to the amount they have invested in the corporation relative to the total amount invested in that corporation via their agency or agencies.

The funding agencies should have to be self-sustaining, and therefore if the agency-funded corporations that have not reached their investment targets have surplus, they should have to pay the agencies if demanded to do so by those who invested in them until they reach their return-on-investment targets, after which they would be independent. The agencies should have ownership of the corporations that have not become independent of them in order for the investors and investment teams to have the ability to recoup some of the potential losses, but besides being able to dictate how much of the possible net surplus of the corporations would be paid to the agencies and when, the investors and the investment teams should have no control over the corporations.
Corporations that have not become independent from the agencies could be called bound corporations, for example, and bound employees’ corporations would, of course, essentially be agency owned and employee controlled limited companies instead of worker co-operatives.
Limited companies still in agency ownership should, of course, have designated potential owners who would control the companies as if they were the owners, except regarding the payments to the agencies, obviously.
The return-on-investment target percentage should be set by law to a level that would ensure that sufficiently well-functioning agencies can make enough profit to not only sustain themselves but also grow without taking on debt.
Agencies that fail to sustain themselves should simply be automatically abolished.
Because the corporations would become independent upon reaching their return-on-investment targets, the investors would, of course, have a fairly strong incentive to remain active.
The agencies should be legal persons, and they should operate much like employees’ corporations.

The head of state, the head of government, the parliament, and the ministry that would be responsible for most of the supervision of the funding agencies should be able to order funding agencies to be established. Funding agencies should be establishable also by the administrative units of the state. The armed forces, the branches thereof, and the ministry of military affairs should also be permitted to establish funding agencies and naturally also to supervise funding agencies they have established, but funding agencies established by them should be allowed to invest only in services supporting the functions of the armed forces and in the production of military equipment.
The initial capital of the agencies should arguably be loans from the state and the administrative units, and they should naturally be able to lend the agencies more too. The agencies should be able to take on debt from the private sector as well.

There should be a special type of corporation to make it easy to distinguish the employees’ corporations from other kinds of worker co-operatives, and there could also be two subtypes of it to allow people to easily tell bound and independent ones apart. If these types of corporations are called employees’ corporations also legally, they could obviously be abbreviated as Bec/bec and Ec/ec.
The core ruleset of the employees’ corporations should be legally mandated so that all of them would be on fairly equal footing in terms of rules, and it seems that a core ruleset with the following rules would enable the corporations to function fairly well:
1. Every employee has one vote.
2. The board is elected by the employees, and all employees are eligible to become candidates for board membership.
3. A binding employees’ vote (on should a new board election be held or should a specific employee be removed from a position or dismissed altogether, for example) will be had if at least 10 % of the employees demand one, provided that the number of employees making the demand is at least two.
4. An advisory employees’ vote will be had if at least 5 % of the employees demand one.
5. Every employee has the right to bring up to two (or maybe three) outsiders to observe the voting and the counting of votes (there should also be a number of experts in the overseeing ministry and maybe in the ministry of justice as well who could be invited to observe the proceedings).
6. Company funds may not be used for campaigning to influence internal elections nor employee votes.
7. The share of the dividend each employee gets is equal to their share of the sum total of all salaries and bonuses paid by the company during the preceding full fiscal year.
8. Whether to pay dividend and how much is decided by direct employee vote, but bound employees’ corporations are obligated to pay the funding agencies before paying dividend if demanded to do so, of course.
9. Independent employees’ corporations can be converted to any other type of corporation (with some fixed minimum delay) if at least two thirds of the employees are in favour of doing so, and the form of corporation and other details can be decided either at the same time or with a separate vote.
Violating these rules should naturally be criminal.

Employees’ corporations would obviously operate on the market under normal market regulations, but given that they would not only be relatively efficient and resilient but probably also favoured to some degree by the general public over other types of corporations, they might become very significant on the market, perhaps even fairly quickly, and a country establishing a system like this might experience an at least somewhat prolonged period of rapid economic development, and it would, of course, fairly likely also gain a substantial or even a relatively decisive competitive edge over otherwise comparable countries without equivalent or similar systems.
If there is a perceived need to protect the system and thus also economic and social stability from fluctuating political trends, the right of the people to have a system of this nature could obviously be enshrined in the constitution as well.

A law regarding employee inventions more or less along the lines of the following would seem likely to have some positive effects:
Employees should have the rights to all inventions they make on the job as a result of their possible research and development duties, but they should be obligated to licence them semi-exclusively to the employer they were working for when they made the invention. Semi-exclusivity would mean that they would not be allowed to licence the intellectual property in question to any other party without an agreement with the employer, with the exception of another employer for which they work. They should, of course, be allowed to sell the rights to their inventions by default, but it should naturally be possible for them to enter into contracts which stipulate that they agree to not do so for defined periods of time, and they should also be allowed to agree to not exploit the inventions in question for as long as the patents in question are in force or for shorter periods of time so that the employers for which the inventors involved made their inventions would have better chances to profit from their investments into the research and development projects leading to the inventions in question. People should, of course, also be allowed to enter into employment contracts which stipulate that the inventions they make during their employment are automatically licenced to their employer if the licencing terms agreed upon in the employment contract are met. The inventors should only be allowed to sell the rights to their inventions after they have signed the obligatory licence agreements or after the patents have been granted if a licence agreement regarding the invention is not yet in force, and if an inventor or a group of inventors sells the rights to their invention and a licence agreement is in force, the licence agreement should naturally bind the new owner of the rights to the invention. The new owner should also not be allowed to licence said intellectual property to any other party except the employer for which the inventor(s) made the invention without a written agreement with the employer in question, and they should, of course, be obligated to licence the invention to the employer for which the inventor(s) made the invention in question if a licence agreement is not in force when the rights to the invention is transferred to the new owner. If the employers the inventors were working for when they made their inventions agree that the right to use the inventions can be licenced to others, the proceeds from such licencing should be shared equally between the owners of the rights to the inventions and the employers for which they made the inventions.

There shouldn’t be a legally defined minimum royalty percentage for obligatory licences, but there should be a legal requirement for the compensation for the obligatory licences to be at least adequate relative to the benefits provided by the patents in question, and if an agreement regarding the terms of an obligatory licence has not been reached within, for example, 100 days after a patent application has been filed, it should be possible for the parties involved to take the matter to a competent court. The royalties should be calculated by multiplying the base prices before taxes with the royalty rates.
It seems likely that a signing bonus equal to some fairly modest percentage of a reasonably conservative estimate of the value of the invention would be the norm in licencing agreements, since it would seem to make a lot of sense for companies to pay such bonuses without much encouragement.

In cases in which an invention has multiple inventors, the inventors should share the royalties equally if they haven’t made a contract regarding their shares of the rights to the invention. If a product utilizes a number of inventions covered by the law regarding employee inventions, the royalties paid could be calculated as follows, for example: the total royalty percentage paid to the owners of the patents covering the employee inventions could be equal to that of the invention with the highest percentage plus the others added up and divided by ten (or maybe five), and the royalties would be shared between the holders of the patents according to the royalty percentage(s) of their patent(s) divided by all of the royalty percentages added up, for example, i.e. if a product utilized 3 patents with royalty rates of 7 %, 8 %, and 11 %, the owner of the patent with the 7 % royalty rate would get 7 / 26 of the royalties, the total rate of which would be 12,5 % (or 14 %).
It seems that this way the market prices of products utilizing even a relatively large number of inventions licenced from inventive employees would also stay at a fairly reasonable level, and all of the owners of the applied patents would get rewarded more or less properly.

It seems quite likely that corporations primarily driven by a single key person or a small group of key people would continue to be limited companies to a significant degree and probably even for the most part in cases in which the key people are also the owners. Employees’ corporations would seem fairly likely to be very key person driven as well, as they might be able to retain innovators and other key people quite consistently, given that they too would obviously have quite strong incentives to pay key personnel adequately, and especially considering that employees’ corporations would probably be relatively likely to have healthy workplace cultures.

A lot of key-person-driven corporations would obviously rather likely keep getting founded as privately funded limited companies as well. There should arguably also be a form of limited company the establishment and operation of which would not require the involvement of more than one person, and if these are an option, it should, of course, also be possible to establish corporations of this kind through funding agencies as bound corporations.
Business arrangements involving inventive corporations and individuals outsourcing manufacturing and/or licencing a patent or patents to an employees’ corporation or multiple would probably be quite common in an economy utilizing this kind of a system, since they would most likely be the most efficient options more often than not and due to greater average efficiency probably also more common than similar arrangements in comparable economies in which employees have less healthy incentives on average.

In the lead-up to and following the establishment of a system like this, private investment in the economy would, of course, be less attractive, and thus the transition period might be somewhat difficult, but it seems that the negative impact might be fairly moderate, i.e. manageable if the funding agencies are provided with ample funds and especially if the system is established at a time when private investment in the economy is already at a relatively low level.

All things considered, the resulting system would seem to be one in which inventive employees would have fairly healthy incentives, employees in general would be relatively difficult to abuse, starting and buying businesses would be relatively easy, corporations would have less superfluous management on average, employees would be on average more productive and also happier and thus probably healthier too, and it seems that the economy in general would quite likely work significantly better after the transition period, and thus it would seem that the unemployment and underemployment rates would also most likely be lower than before it. In addition, it seems that the immigration of many kinds of professionals and especially of the innovative kind might increase quite considerably, provided that the other qualities of the society in question don’t make it somehow repulsive, obviously.