Futarchy is a form of government proposed by economist Robin Hanson, in which elected officials define measures of national welfare and prediction markets are used to determine which policies will have the most positive effect. It was named by the New York Times as a buzzword of 2008.
Futarchy is Robin Hanson’s term for a form of government where decision markets are employed to forecast the likely effect of a proposed policy on some measure of overall welfare, such as GDP+. If a decision market indicates that a proposed policy is likely to generate a positive welfare benefit (relative to the status quo), the policy is automatically implemented. Actually, Robin uses the word “immediately” to determine when the proposed policy is to be adopted. A careful reading of the papers indicates that “immediately” really means the adoption of the policy is “hard-wired” to, or directly follows from, the decision market’s forecast. Citizens vote for elected representatives, who administer the definition and annual calculation of the welfare measure. Using decision markets, citizens (speculators) place bets on the likely effects of proposed policies. In this sense, “We Vote on Values (what to do), but Bet on Beliefs (how to do it)”.
I was at the debate and asked a question about California’s proposition system being representative of what I believe is a large part of Futarchy. This was dismissed by both Moldbug and Hanson. However, I will provide more details for why certain proposition votes can be used as proxies for Futarchy decisions. Not all propositions fit as some are votes on non-monetary matters. But there are some where vested interests might benefit more from passage than the perception of the costs to voters (where a bad decision could be made as per Moldbug)
As a resident of California, there are bond measures and other financially related propositions where passage would mean that I will in future be out of pocket hundreds to thousands of dollars. Far more than I have ever gambled on any single bet or betting session. The groups that get a financial proposition into play are spending millions to get the signatures and then more on the marketing campaign on the lobbying. Some potential or actual winners can get billions in benefit for say a large development project. There are also labor union measures.
These are up and down votes with money on the line for the voters. So I do not see any meaningful differences between a futarchy market for the question of removal of a CEO or removal of a governor and a proposition vote to recall a governor. (which we can examine the historical record)
Also, in terms of Moldbug’s royalist argument for CEOs to run government. There are several examples of CEOs running governments. Michael Bloomberg mayor of New York. Potentially Meg Whitman as a governor of California. Mitt Romney (governor of Massachusetts).
People can make there assessments about the performance of those administrations. There are many other of actual examples.
So I think there are proxy cases for better assessment of what might or might not happen with actual implementation of Futarchy or reinvented Modbug royalism.
Brian Wang is a Futurist Thought Leader and a popular Science blogger with 1 million readers per month. His blog Nextbigfuture.com is ranked #1 Science News Blog. It covers many disruptive technology and trends including Space, Robotics, Artificial Intelligence, Medicine, Anti-aging Biotechnology, and Nanotechnology.
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