Early in human history, we did not need to keep score. In a world where it was every person for themselves, what mattered most was whether any particular individual garnered enough resources to survive in the short term. People lived day to day...really. The ability to accumulate resources and to trade created a whole new world, but it created both opportunity and peril.
Exchange is central to the accumulation of wealth. Free exchange in the engine which allows for resources created by one party to end up in the hands of another party where they are used to create greater value. Win-win exchanges are how wealth is created. When trade was simple, it was easy to track. When exchanges became more complicated, it became more difficult to track who owed what to who. Fast and furious exchange may create the appearance of wealth creation where no additional value is actually created.
A perfect example of this is the Ponzi scheme where no actual exchange occurs, no value is created, and yet the illusion of wealth prompts all types of economic exchange which ultimately must be undone. At one level, the creation of huge entitlement programs can be viewed as Ponzi-like schemes. Some of the investors do not have the option to not be investors but in the same sense as the voluntary marks, their monies are not invested but instead are paid out immediately to satisfy the demands of those who have previously invested in the system through their votes. Some of the investors (e.g. investors in T bonds) are betting on the ability of the US government to continue to compel the tax payers to continue to fund the increasingly precarious enterprise. At some point, even the US government will not be able to dance fast enough to keep the game afloat.
Oddly enough, the driver of this is as old as civilization. When the Natufians created permanent settlements, they no longer left their old and infirmed to die. Those who produced also took on the obligation for those who were no longer able to do so. Plenty served to be a trap by creating an explosion of population and quickly resources were outstripped by numbers. The was the curse of sedentism. There were no retirement accounts, just hard assets such as food and shelter When there was not enough, people died of starvation or exposure. There was no way to game this system. They had to create more resources or people died.
Human ingenuity has driven the expansion of resources to where famine is seen only where it is used as a brutal weapon of political repression. However, the impact of sedentism remains with us, albeit in a markedly different form. In the simplest sense, sedentism is the product of societies where social norms allow for segments of the population incapable of creating resources which they ultimately "need" and can lay clam on.
Do not take this observation as a criticism of any societal obligation to care for the weak and the sick. Our compassion and desire to help others is what makes us human and is crucial for the creation and maintenance of complex social structures. Where it gets complicated is when invariably appropriate claims changs over time and become harder to track and account for and when the claims outstrip the resources, problems arise.
When we declare that people have a right to health care, we must consider the lessons of sedentism. When our ancestors bought into value systems which compelled those who produced with obligations to feed those who could no longer produce, there were limits on the nature of the obligations which were rooted in the world of the possible. In the world of health care, the obligation we have created is open ended and not anchored in the world of the reality of scarcity. We are on the road to financial ruin driven by health care expenditures, consuming substantially more than we are creating. We have created incredibly complex and expensive interventions which are deployed without regard to actual value they bring or how we will pay for them. Declaration that they fall under the rubric of human rights serves to short circuit any real discussion of whether they are really the right thing to do and whether we can afford them.
Our present approach to addressing this resource mismatch is to use a state driven Ponzi scheme. It may work for a while if the mismatch is small enough, or if increases in subsequent productivity offset the mismatch, or if inflation devalues the mismatch, or if you can find new "investors" who will fund this for a while. However, we are still ultimately limited by what is deliverable within the world of the possible, but it may be more difficult to see when the resources will be depleted and when the "investors" will stop funding the Ponzi scheme. Using a Ponzi like scheme may work for a while and create the illusion of real wealth but it cannot work forever.
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