Economy of a worldwide totalitarian regime

Question

In my scenario, the government of Earth is sending colonists to Tau Ceti e, because of that planet's amazing abundance of resources. At this point in the future, long distance space travel is possible, albeit at subluminary speeds. I know that this would be prohibitively expensive by today's standards (greater than the entire GDP of the world); I can work around some of that by saying that technological advancements have increased such that not only is it possible, but more affordable (I'm thinking that a probe mission would cost about as much as Curiosity.

However, this leads me to the meat of my question. Earth is ruled by a despotic, totalitarian empire at this point. Society is divided into strict classes, and everything (including the economy) is tightly controlled. The lowest common people make up the largest caste, and do all the hard or menial labor in the world...don't worry about how they are subjected.

With such a tightly-controlled world, how can I apply a price or cost to some extremely expensive project, like colonizing TCe? Or is it just a futile exercise? Is the only cost of the project, then, just the opportunity cost?

And more generally, how would currency even work in such a world, if the only value of something is measured in its opportunity cost?

Answer 1

Usually, people tell that prices are set by demand versus supply. But, on a stable society, without large disruptive technologies or special events that might prevent stockpile and so make demand overtake supply, price is set by the total ammount of work needed to produce a certain object. This comes from the theory of value that comes from Adam Smith ("Richness of the nations.").

If distribution in your society still works as a market based one, and you still have labour as part of your production chain, price is the comparision of how much labour is needed to produce a certain commodity versus each other. Its a strange prospect to be so far in the future and still have a labour intensive economy to justify the existence of slaves. Robots replace slaves in most futuristic settings.

In our society the most important aspect of production is labour and capital, with energy and raw materials as the second most important things. When your society reachs a certain level of automatization of production, your source of value will shift towards energy and raw materials.

So, to have a society where raw material shortage is so big as to justify why go all the lengths to reach other planets, this is not very compatible with slave labour.

But, if your society has slave labour, this does not mean that production has no measure ("value"). Your value will be the total output of your labour pool, per time period, multiplied by the capacity of the machinery to increase productivity. People make the usual mistake of taking the prices of things as the limit of production. But, this is not usually true. Price is an arbitrary number that holds no meaning by itself. It can only have meaning when compared to other prices and salaries.

So, what you should measure is the ammount of man-hours spent to produce something. This is your price.

To verify if something is economically feasible, you should take the ammount of men-hours needed to produce that thing. If its too big, bigger than your labour pool can produce, then its impossible. Even then, you might produce things on the long run. If you give a project enought time to mature, you can overcome labour limitations. If, for one, your society cannot build a spaceship in a single generation, this does not prevent it from doing so in multiple generations. But, economy is the management of scarcity. So, we usually wont do what would take too much time to return the work spent, except in special cases.

A good rule of thumb is to take the time that a spaceship takes to reach another planet and verify if the same ammount of raw resources could be mined here on earth instead. If, going that length produces more raw resources than applying the same ammount of work on earth would produce, then we have a profit, and so, we might do the trip. This means that the price for that spaceship is relative. You can set your story in a way that raw resources on earth are already depleted, so that exploring mines on earth takes a lot of resources, while taking the trip to Tau Ceti takes only a certain ammount of energy that might be extracted from both our sun and Tau Ceti sun's.

Technology plays a role in productivity. If your society is able to directly convert energy to matter and vice versa. You might have a way to store enough energy to do the trip. Technology increases the value of work, because it allows a single man to produce more by each man-hour he spends working. In energy, technology means more advanced forms of energy that stores more energy per volume or weight.

Chemical energy is what we use to launch space rockets today. Its energy density is small compared to the ammount of energy that is needed to launch a space ship to Tau Ceti. Ion thrusters are a way to convert electrical energy into impulse. But it need xenon gas to work, and this has a low density. Nuclear fission is a lot more compact than chemical energy forms. Nuclear fusion is even more powerfull than fusion, and as the technology is almost within reach, it might be interesting. Anti-matter anihilation has even more capacity to do work per volume than fusion. Direct matter to energy conversion is the ultimate source of energy in our universe, and means that ordinary matter can be used as energy source. This decreases the ammount of human work that must be done to launch a space ship, and so on. At each step, the human work to gather the energy is multiplied by the technology used. If takes some man-hours to gather petroleum and turn it into gas, the same ammount of man-hours would produce much more joules if used to gather matter to be used in direct energy conversion process.

And there is where things become complicated. If you can convert energy directly to matter, and you can convert matter directly to energy, you can create ordinary matter however you want. Eliminating scarcity.

If you take matter from soil, and turn into energy, to fly into Tau Ceti to get ordinary matter from Tau Ceti, you are wasting matter for nothing. The matter spent to reach Tau Ceti might very well be converted into other forms of matter here on earth.

Something that might change this, however, is if you setup a large fleet of ships between earth and Tau Ceti. The total ammount of energy spent in the trip, is proportional to how close to the speed of light you go. How close to the speed of light you go, is proportional how much energy you put on the ship to make it accelerate. If you do the trib at small values compared to C, you might very well spend a small ammount of energy in the process. But, at the same time, you lenghten the time that takes to reach there.

This means the following. Take a large fleet of ships that are roboticly commanded, setup a chain of ships, where each ship leaves earth after the previous, with a certain time between then. Keep launching ships until the first ship sent arrives. Now you have a circle of ships going and comming back to earth. The time between each ship should be choosen so that you have enough time to build another ship between each launch. The only drawback of that strategy is that the slower you go, the more time it takes to have a return in your investment.

Now you can feasibly explore the richness of other planets.

Picture:

Keyword here is how fast you need your ships to return.

Answer 2

In general, totalitarian (and other despotic) regimes are great at huge unreasonably expensive projects, just look at the pyramids, or the terracotta army and the whole mountain sized complex that houses it.

The only real costs to the regime leaders are time and natural resources. Are they willing to concentrate on a project that may not yield any interesting results before they are dead? Does using resources (including people) to make it happen divert those resources from something else they want have accomplished? Currency would probably not mean anything to the regime (they already own everything that can be bought with it)

Answer 3

There are several questions in one go. But to start with the easiest, last paragraph point: how the currency work in such case. One can distinguish two main cases:

• National regime. The whole world is united into a single regime. Then totalitarian regimes could either be leaning to the planned economy (communist), or liberal economy (some fascists).

  • Planned economy: the government basically decide what is the value of the currency. How much bread/milk/cars one can buy with one unit of currency.
  • Liberal economy: you have markets setting the "power" of the currency to acquire the goods. This is working like most of nowadays markets: depending on offer and demands, actors involved and a bit of chaos, you know how much you need to spend to get each element.

• Supranational regime. Countries continue to exist and each may have a different country. But all respond to a supranational authority/government. It could be all planned and in that case the currencies are fixed towards each other, or free, and then you are pretty much like today (as far as the currency is concerned).

From the details that you provide, you probably want to go for planned economy. You still can choose between a single currency or different ones. They have both advantages and disadvantages.

For the cost of the expedition, you should count in man-hours. How many people have to work on the project. These people have to eat/be housed/etc. Also you probably need some equipment/labs, etc. If as it sounds from your question, you have a planned economy with an essentially national regime, the man-hour is your currency of reference. The more people are involved, the more costly it is.

And you have to consider that the persons involved in the project are not, by definition, doing anything else. E.g. mining the metal for your rocket instead of producing food. Engineering a new rocket motor instead of your new personal jetpack, etc.

Furthermore, if each and everyone is turned towards the project, there may be some food shortage, and so on. That might provoke some social unrest, which is costly in people and time.

(Edit) At the opposite, a large-scale project may help to create a national unity and help to get common people to focus off the current regime.

Answer 4

In a capitalist society cost is is an issue. In a complete totalitarian society, allocation of resources is the problem. Every type of government has a budget, but different types handle them in different ways. A totalitarian government doesn't have to buy anything. The government does not need to use a currency. The government does, however, need to prioritize resources. Should we use 25000 people to build that bridge, or should we move them to the big dam building project? Should we use this steel for planes or should we use it to make weapons? If the government can allocate the resources, it should not be unobtainable.

Answer 5

Totalitarian regimes generally do not use resources efficiently, so while it may be possible for them to use the entire resource budget of the world, the end result might be like the Soviet Union, where factories produced vast quantities of shoes for the left foot, but none for the right. In these sorts of totalitarian regimes, high tech products are possible, but usually at the expense of everything else, and even then might not be particularly successful or useful. Once again, the Soviet Union and now Russia are perfect examples. They focused on military hardware, so while they could pull off the occasional world beating project like the "Alpha" class submarine or being the first into space, they could rarely sustain their advantages (the successful Russian rockets are designs dating back to the 1960's; no Russian Elon Musk or SpaceX "Falcons"), and while there are lots of Russian tanks, there are no Russian consumer goods like coffee makers.

You might end up with rather ramshackle spacecraft which don't last the length of the journey to Tau Ceti, cratering the entire investment.

One other element you should consider is that most despotic regimes have little incentive to do anything like spaceflight to distant planets, because this provides opportunities for people to escape the regime. Having total control over people's lives is pretty difficult when they are light years distant, and might choose new goals that are different from the State's goals. Even if you assume some sort of conditioning beforehand, the fact the crew will have to cope with extreme, unexpected and unpredictable conditions means they will have to work outside the boundaries (much like the colonists in the America's in the period from the 1500's to the late 1700's), reshaping their social and cultural order in ways the State might not appreciate or find desirable. Any crew too tightly conditioned to work outside the "box" will be too inflexible to succeed in strange new environments.

The last thing which speaks against this project is that a spacecraft is a weapon. Even achieving Earth orbit means going many times faster than a rifle bullet, so the kinetic energy of a re entering body is quite high (an artificial meteor). An interstellar craft would likely be far larger than an ordinary spacecraft, and potentially move far faster. Would a despotic state really want to take the risk?