Sapien Loop and Our Own World – Part Two: The Economy and Power Structures

An excellent place to continue my comparison between Sapien Loop and our world is the economy and the power structures that help shape it. I have worked as an economist since 2007. I used my knowledge of economics to create a plausibly functional alternative economy for Sapey. It was loosely based on a combination of our current systems and a possible future system that could be built through technology.

Demand and supply are the broad fundamentals of economic activity. This is true on both the micro and macro levels. For an economy to function, demand and supply must respond to each other. People have needs and wants. Businesses aim to produce products and services that best meet these needs and wants. If they are successful, people will demand these products and services. Businesses will strive to make their products and services the most desirable. This could be through lower prices, higher quality, or the creation of a positive perception.

In an ideal world, people will have complete awareness of their own needs and wants. Businesses will be able to create products and services that perfectly meet these needs and wants. Businesses will have the capability to efficiently produce sufficient quantities of these products and services to meet the demand for them. People will have sufficient resources (i.e., money) to exchange to obtain their desired quantities of these products and services. It will be possible for everyone to have a high standard of living.

In reality, this has not been possible. All types of economies benefit some over others. Let us compare markets at opposite ends of the spectrum.

A highly competitive free market economy (i.e., laissez-faire) benefits people and businesses who are innovative and can successfully utilise whatever advantages they have to create the perception of value. This leads to efficiency in markets that can remain competitive and have the potential to be profitable. Markets with limited potential for profit are often neglected. Markets that cannot remain competitive because of market-induced or industry-induced barriers to entry eventually become inefficient. People who are not strong competitors fail and fall behind. Many people are not able to meet all their needs and wants.

An economy that is very heavily controlled by the Government (i.e., a command economy) benefits the leadership in Government. They have greater control and power. They determine what is produced, how it is produced, and how it is distributed. They do not need to rely on a demand and supply model. They simply supply, and the people must accept what is supplied to them. There is little incentive to be efficient, as Government operations face no competition and are not required to be profitable to continue operations. A well-run Government with benevolent intentions should be able to ensure all the people’s basic needs are addressed, but nobody is likely to prosper.

Forces That Shape the Structure of the Economy

Those who have the most power have the greatest say over the structure of the economy. This could be the Government, businesses, banks, religious institutions, media, or the people in general.

If the Government had almost all the power, they would most likely desire a command economy. This would enable them to exercise and maintain their power. For example, North Korea.

If the people had almost all the power, the type of economy would be dependent on culture. In a Western liberal society, they would desire competitive markets. They would not want the government taking too much power, nor would they want big businesses to dominate. They are likely to desire some form of collective intervention to prevent any particular groups from gaining too much power as well as prevent anyone from falling too far behind.

In reality, the people have little to no real power. Instead, there are countries where people have the illusion of power. These are broadly called ‘democracies’. To maintain the illusion, an economy needs to function and meet the cultural expectations of the people. For Western liberal societies, a mixed economy can be aligned with the expectations of its people. A mixed economy is a blend of capitalism and state intervention.

To maintain the illusion of people power (i.e., democracy). Governments are voted into office. For Governments to appear to be legitimately elected by the people, there needs to be the illusion of choice. This has been done by limiting political debate to a one-dimensional political spectrum of left and right ideologies. Some Western countries (e.g., US, Australia and the UK) enforce this through a two-party system where one major party supports the ideology of the left and the other of the right. This is to create the illusion of difference and therefore the illusion of choice. Many European countries enforce this using multiple parties supporting the left and right. These parties form coalitions based on where they sit on the one-dimensional political spectrum; this can be done before or after an election. The side that wins the most seats in parliament forms Government with their coalition of parties.

Limiting politics to just a one-dimensional spectrum is incredibly powerful. It inevitably restores balance. For example, people in a country may overwhelmingly lean towards left ideology. This would result in the election of a left-leaning Government. When this Government underperforms, people will abstain from voting or switch to the only viable alternative for change, which would be the right-leaning party/ies. This will eventually lead to a change in Government, thus naturally maintaining the illusion of choice.

The prevalence of two ideologies helps keep the people divided. It puts them into two distinct camps of opposing views. Multiple ideologies would not have this same level of effectiveness at creating diversion because there would be overlaps between the ideologies. These overlaps would help create cohesion. The key to controlling people is to ensure they remain divided so that their energy is directed towards each other rather than the system and those controlling it.

Limiting politics to just two ideologies enables political parties to focus almost purely on the differences between them. In practice, the differences between the parties are minimal. This is evident when very little changes when new Governments take office. The few changes that occur are for the benefit of those who hold the real power. A Government with a different ideology is needed to make these changes appear more palatable to the people.

To prevent giving the people any form of real power, the power of the Government must be limited. The overarching power has to sit with people who are at minimal risk of losing it. These people head big business, banks, and religious institutions. For the real ruling class, this shift in power works incredibly well. Both power and wealth can be protected from any form of process, and they do not even need to be tied to just one country.

The Government, big business, banks, religious institutions, and the media form what I consider the body of most Western establishments. All five play a critical role in maintaining the power structure.

Government and Politicians

The Government are the face of who people believe are running the country on their behalf. This illusion is easy to maintain. They control the vast amount of taxpayers’ money. They make the laws and policies that influence how the country is run. They have the police and military at their disposal to use force if needed. However, because political leaders are elected, they are vulnerable and temporary. They could be voted out at an election, or their own party or the built-in processes could remove them.

External parties, through incentives and disincentives, can control political leaders.

Incentives might include the promise of prestigious, high-paying positions in global organisations or lucrative speaking tours and lectures. Some are given special awards such as peace prizes or knighthoods.

Disincentives would involve early removal from office, prosecution or worse. Banks and big business are capable of causing markets to temporarily crash (e.g., former Prime Minister Liz Truss was disposed of this way). The media can expose them for alleged scandals or focus on possible failings and highlight incompetence. Non-Government Organisations (NGOs) can manipulate from the grassroots level by spreading misinformation and lies, organising protests and demonstrations, and even inciting riots. For example, the many colour revolutions that have led to the fall of Governments and leaders.

In most Western parliamentary systems, politicians are required to work their way through the party. They might start at the grassroots level and eventually be selected to run as candidates to become members of parliament. After some time as a member of parliament, they might work their way up to a junior minister position and then minister. If in opposition, they might become a shadow minister. If they continue to fall in line, they have a chance to become party leader.

During this process, they are heavily screened and monitored. This is to ensure the right politicians reach the top positions. Any politician who poses a risk will not reach the top. They could be ignored or removed from the party, which would likely mean they would lose their seat in the next election. Some politicians with connections are chosen before they are even elected into parliament. They are often given safe seats to run in and then allowed to move very quickly through the party (e.g., former UK Prime Minister Rishi Sunak).

Presidential systems are different from parliamentary systems. However, typically, presidents have held positions as either representatives, senators, or governors before becoming president. Donald Trump is a rare exception. This allows plenty of time for them to be monitored or groomed if necessary.

There are many different types of politicians. Some politicians have dark secrets that they do not want to be exposed; therefore, they are easy to manipulate. Some politicians are opportunists with little to no moral values and would be willing to advance themselves through any means necessary. Some politicians have low intelligence and believe they are actually performing some form of service to the people. There are elected leaders who are not even politicians but are actors instead. They gain office through their popularity from exposure in the media. They continue their acting profession as leaders and follow instructions from a handler. Actors normally become leaders through presidential systems (e.g., Ukraine President Volodymyr Zelensky).

Democracy and Capitalism

Economically, countries with Western-type ‘democracies’ are the most successful in the world. This has little to do with ‘democracy’ itself but much more to do with economic freedom and competitive markets. Competition builds innovative, efficient and effective businesses.

Table 1 contains the countries with the highest Democracy Index from 2006. It looks at how these countries’ scores have changed in 2024, the extent of economic freedom that their residents and businesses enjoy, and changes in the size of Government.

Table 1: Democracy, Capitalism, and Big Government

Sources: 2024 Democracy Index: Our World in Data. Economic Freedom Scores: Fraser Insititute. Government Procurement Expenditure as Percentage of GDP: Our World in Data. Prevailing Religion: PBS
Note: The Democracy Index ranks 167 countries, and the Economic Freedom Score ranks 165 countries.
Note: The Economic Freedom Score is a simple average of five scores. They are the Size of Government Score, Legal System and Property Rights Score, Sound Money Score, Freedom to Trade Internationally Score, and Regulation Score.

Countries ranked highly based on the Democracy Index also ranked highly based on the Economic Freedom Score. In 2006, out of the top 25 countries ranked highest based on the Democracy Index, 19 of them also ranked in the top 25 based on the Economic Freedom Score. The only two exceptions were Hong Kong and Singapore, which ranked low on the Democracy Index, 78 and 84, respectively, but very high based on the Economic Freedom Score, 1 and 2, respectively.

The Economic Freedom Score has been gradually falling for most of the countries ranked highly on the Democracy Index. From 2006 to 2022, the Economic Freedom Score of 20 out of 25 of these countries had fallen. The biggest factor contributing to this lower score was the growth in Government size. From 2006 to 2022, 22 out of 25 of the highest-ranked countries based on the Democracy Index increased the size of their Governments. In 2022, in terms of Government size, the USA, Switzerland, and Malta were the only three Western democracies to rank in the top half (82 or better) of all countries assessed.

Countries ranked highly on the Democracy Index had a high percentage of GDP spent on Government procurement (i.e., Government spending on goods, services, and works provided by the private sector). From 2007 to 2023, this spending increased for 17 out of 24 of these countries. This would have been a key contributing factor to increasing the size of Government. The increase in Government procurement spending is likely to maintain activity in the private sector. This could be a reason why the Economic Freedom Score for these countries has not dropped further.

Increasing Government spending through procurement is a method of increasing Government control with a smaller immediate impact on the economy. Government ideology has switched from controlling supply through Government ownership of business to controlling demand but letting the private sector supply it. The Government becomes a proxy customer for the people. This is also a method of transferring wealth from the people to big business.

Religion

Religious institutions have influence over any form of leadership. Their influence comes from their power to control ideology. Many Western ‘democracies’ have prevailed in predominantly Christian countries: see Table 1. Liberal Western values most likely have their roots in Christianity. Shared values include social justice, compassion, equality, and individual freedoms. These values support the rise of democracy.

The church has played a role in the rise of modern democracy. The Magna Carta of 1215 could be considered a cornerstone of modern democracy and law. It was designed to reduce the power of the monarch. The Barons, who were mostly wealthy landowners, wanted to protect their land, property and wealth from seizure by the monarch. The church took advantage of the tension between the two sides to act as a primary mediator. This enabled them to include the independence of the church as the first clause in the Magna Carta (Magna Carta Project).

The Magna Carta was just the beginning of a long power struggle between the monarch and wealthy landowners. After the Glorious Revolution of 1688, the landowners became more powerful than the monarch. They exerted their power through parliament. The Church of England supported the revolution, as they believed the existing monarch posed a threat to the Protestant faith.

Members of Parliament were elected, but less than 20% of the population were eligible to vote; only Protestant men with a certain value of land were eligible. Over the centuries, voting rights expanded to non-landowners, people of non-European descent, and women. In the UK, this was largely because of the efforts of the Chartist movement in the 19th century and the Suffragette movement in the late 19th and early 20th centuries. Socialist ideology rather than Christianity happened to inspire these movements. However, socialist ideology aligns with many of the teachings of the Bible but not necessarily the practices of the church.

Benefits granted to the landowners created a divide between them and the working-class men. Equality of rights is a fundamental liberal value. All men desired to be treated equally. Once the working-class men had achieved some success, the women would inevitably want the same. The ripple effect was inevitable.

The church has lost much of its direct influence over the people in most Western ‘democracies’. Many Christians do not regularly attend church. Many more have completely abandoned Christianity and have become atheists. However, religion has not lost its influence in shaping ideology. It has just shifted away from Christianity.

Islam is on the rise in Western democracies. This is mostly through migration. Islam is considerably stricter and more dogmatic than most forms of modern-day Christianity. The strictness of Islam is reflected in many Islamic cultures. This is particularly true in the Middle East and North Africa. Most of these Islamic-based cultures are not compatible with Western liberal values.

There is a good chance that Western countries will try to align themselves more closely with Islamic culture. This could mean including elements of Sharia law into official Western law. This will work well with Western establishments, as they can become more authoritarian with minimal resistance from the new demographic. This would also enable them to continue increasing the size of Government.

Big Business, Banks, and Media

Large businesses have consistently grown faster than Western economies. In the US, in 2010, the largest 0.1% of companies controlled 88% of total corporate assets (Chicago Booth Review) In the US, the largest 0.3% of companies employ 1/3 of working people (Fact Finders). The concentration ratios of the four largest firms in many US industries have increased since 2002 (Statista).

As big business grows in size and wealth, so does their ability to influence the Government.

Banks have also grown bigger and more powerful. Private banks have grown through mergers and high revenues. Increased size of Government has contributed to this growth. Some of the Government’s increased spending is funded by borrowing. This is typically done through the sale of bonds. Banks and other financial institutions buy a large percentage of these bonds. Private banks use the bonds as collateral to borrow from the Central Bank. They could use this money to lend to their customers or even buy more bonds. The return will be higher than what they pay back to the Central Bank in interest on the loans.

The Central Bank may choose to buy the bonds from the private banks. This helps enable the Government to sell more bonds, which are likely to be bought by private banks. The greater the Government debt, the greater the influence the private banks and Central Bank have over the Government as they become more vulnerable to interest rate changes.

Banks gain much of their power from the value of assets they control. In 2007, the top ten largest banks controlled assets equivalent to 37% of world GDP (Reserve Bank of Australia). In 2022, this rose to approximately 50% of world GDP (see my post ‘Being Controlled With Our Own Money’). The banks, through their size, can easily disrupt economies in various ways. This gives them the potential to have enormous influence over decision-making.

The media have the potential to be enormously powerful because they control information. This power is magnified when the sources of information are limited. Just six media companies (Comcast, Disney, Warner Bros. Discovery, Amazon, Sony, and Paramount) control most forms of media and streaming (Motley Fool). It has been previously estimated that the largest six media companies own 90% of all media outlets in the US (Tech Startups). The changing media landscape (e.g., streaming and social media) has made new estimates difficult. According to Grok, even in this more diverse landscape, the big six media companies still control between 70% and 80% of all media.

Politicians are no longer required to act in the interests of the people. If they want to stay in leadership or be positioned for a bright future outside of politics, they must pursue policies that align with the interests of these three groups as well as conform to the ideology of the prevailing religious institution. The mainstream media will spin them in their favour and will vilify or cancel anyone pointing out the true intentions of such policies.

Sapien Loop Economy and Power Structure

The Sapien Loop economy, like in reality, is highly dependent on the power structure. Even though the outcome is different, it is built on the same principles and relationships as I have explained. ‘End of an Era’ describes the economy and power structure in its most evolved state. ‘Frozen in Time’ takes a step back by telling the story of how the economy and power structure evolved in such a way. The story was not intended to replicate the events of reality but to replicate the real-world motivations that could lead to such a structure.

Sapien Loop Economy

‘End of an Era’ describes a unique economy that is based on the possible evolution of current Western economies. The size of Government is large but is limited to running just basic services. It relies on outsourcing almost all production to private companies that operate in what is referred to as the Business Sector. The Government is the customer on behalf of the population for what are referred to as ‘rights’ in the book.

Rights are very similar to Universal Basic Income (UBI), but instead of receiving money, they receive items that are considered to address needs. These include food, housing, energy, and clothing. UBI is being trialled in several countries. There is a good chance it will be implemented somewhere. Such an initiative would grow the size of Government. When Governments find that UBI does not solve poverty, the next step could be something similar to the ‘rights’ described in the books. This will prevent people from spending given money on items not considered essential.

Sapiens are also able to earn money through employment. The currency they receive is called tokens. It is an electronic currency, which is very similar to the proposed Central Bank Digital Currency (CBDC).

CBDC is an electronic currency created and supplied by central banks. Several countries have proposed that it should eventually replace physical currency. CBDC is promoted based on convenience, but it is actually a very powerful mechanism for control. A CBDC ensures no money ever leaves the system; it is digitally moved between accounts. Therefore, all transactions and exchanges of money can be observed or even restricted if necessary. For example, quotas could be placed on how much of a particular good a person can buy.

The Economic Institute issues the tokens in Sapien Loop. These tokens are programmed for particular usage. For example, a particular token might only be used for travel. Tokens have an expiry date. If they are not used by this date, they are lost.

Tokens are not only used to control the population but all economic activity. Increasing or decreasing the quantities of different tokens shifts demand. The expiry dates control the timing of demand. Tokens are explained in detail in the short story ‘Just Another Day in the Economic Institute’.

The Economic Institute is the private banks and Central Bank rolled into one. It has absolute control over the monetary system. It determines how many new tokens are created each year. Then it passes these tokens directly to the Government. It bypasses the convoluted real-world processes of selling bonds and quantitative easing. The Economic Institute are not allowed to become directly involved in politics, but the Government policy and initiatives are also funded by newly created tokens. This indirectly gives them power over Government spending.

Sapiens were unable to start and run their own businesses. The existing businesses and the Government blocked their entry. The economic system prevented Sapiens from being able to save or acquire capital to start a business. Even if they could, they would be hugely disadvantaged, as the existing businesses had a large, steady flow of revenue from the Government, which guaranteed their survival and most likely success. Existing businesses had strong, established links among themselves that would easily keep any newcomer out.

In our world, Governments have waged war on small businesses in various ways. These include the forced shutdowns during the Covid-19 fiasco and regulations that hurt their ability to compete.

The only possible access to business ownership that Sapiens could be allowed was through employment in an existing business. If a Sapien performed well for a considerable period, they could rise in the business hierarchy to a point where they would be offered part ownership. The purpose of this process was not to give ownership to Sapiens but to create the perception that it was possible. In reality, it never happened.

Despite complete barriers to entry to any possible Sapien-owned business, there were no official monopolies. The Agreement of Four, outlined in ‘End of an Era’, was established to prevent that from occurring. It stated that industries should always have between four and six businesses and that the largest three businesses could not control more than 90% of the market. All markets were oligopolies dominated by large businesses. These businesses worked together to maximise each other’s profits and extract as much value from their employees while providing the minimum to their customers.

The economy is designed to build the wealth of the richest; these were the Linap business owners. We could argue that this is a form of plutocratic economy. However, at the same time, it was also designed to provide the Sapiens with everything they needed while preventing them from accumulating any form of wealth. We could argue this is a form of socialism. The combination of the two creates a form of plutocratic socialism. This could become a reality if the size of Government continues to grow and if CBDCs are strictly implemented.

‘Frozen in Time’ explains how wealth and power were transferred from the wealthiest family of the age to the Government through the rapid expansion of the money supply and devaluation of the physical currency of that age. It also explains how the Government was forced to privatise all of its assets to fund the crisis of the time. The shift in assets was accompanied by a shift in power from the Government to the Business Sector.

Sapien Loop Power Structure

In ‘End of an Era’, the Sapien Loop power structure is that of a democracy. Representatives are voted in by Sapiens, and in turn, they vote in the twelve governors who form the Government. The Sapien Loop political system does not have parties. Instead, either the House of Divine Knowledge or the Business Sector endorses representatives. Like in the real world, politics is divided into two main ideologies. The House of Divine Knowledge promoted conservative social values based on religion and socialist economic policies to support equality. The Business Sector promoted classical liberal social values to support individualism and capitalist economic policies to support growth.

The purpose of excluding parties was to highlight the impact of two opposing ideologies without the need to explore party politics. This impact is highlighted and emphasised by the negative reaction of Sapiens to the banning of the House of Divine Knowledge in ‘End of an Era’.

‘Frozen in Time’ takes us back to a time just before democracy existed in Sapey. It explains how the Linap were manipulated into voting for popular entertainers to become their first elected leaders. These elected leaders were not the real leaders. The company (i.e., handler) that funded them and gave them exposure controlled them. Within a short time, the entertainer in the Capital City gained confidence and started to separate himself from his handlers. The handlers could not keep a strong grip on him, as they did not have a controlled opposition as a viable alternative to use to threaten him.

The entertainer’s lack of leadership and experience quickly led to his fall. A new popular leader, who was backed by someone considerably more prepared, replaced him. Opposition was now controlled through force as a method of protecting the new leadership.

The idea of controlled opposition was not fully developed until the short story ‘Just Another Day in the Economic Institute’. The story explains how the Economic Institute, by remaining politically neutral, could control governors and representatives endorsed by both the House of Divine Knowledge and the Business Sector by simply enabling the natural flow from one side to the other.

In the Sapien Loop timeline, leaders evolved from all-powerful chiefs to entertainers controlled by handlers to a dictator and finally to opportunistic governors backed by either the House of Divine Knowledge or the Business Sector. At this point, an establishment similar to our own world was formed. It consisted of the Government, the Economic Institute, the Business Sector, the House of Divine Knowledge, and the Media.

---

Some images were created with the help of Bing Image Creator

---

The Sapien Loop Series

I am writing a trilogy of books titled Sapien Loop. The first in the series is Sapien Loop: End of an Era and the second is Sapien Loop: Frozen in Time. I published both of these books as ebooks on Amazon, and I have posted completed chapters to my @captainhive account. I anticipate publishing the third book in early 2027. I expect to title this book Sapien Loop: Worlds Collide. In 2025, I plan to write short stories about some of the characters and their adventures. I will post these to my @captainhive over the course of the year.

Brief Summary of Sapien Loop: End of an Era

This story is based on the fictional planet Sapia and its sole country, Sapey. Sapey is portrayed as a form of utopia for all its citizens. No poverty. No war. Almost no crime. Opportunities for all.

This was enough for most citizens, but not all. In one of the small regions, some of the citizens had become discontent. They felt something important was missing in their lives. Their discontent did not go unnoticed. Some of the Sapey elite wanted to weaponise this discontent to gain more power. This created more chaos than they anticipated. This led to further widespread social unrest.

On top of the chaos, ambition and greed provoked another enemy. This enemy was on a mission to settle both new and old scores.

Brief Summary of Sapien Loop: Frozen in Time

This story is based six years after the original story. The Downs Region is still suffering from a serious health crisis caused by the contaminated water. The main characters are desperately trying to a find a cure for the illness that has been caused by the water.

One of the main characters has discovered frozen humanoids in hidden chambers. It appears they have been frozen for a long time. These chambers connect to a vast network of tunnels. While exploring the tunnels, one of the frozen humanoids disappears. It appears he has been stolen.

The story takes a step back in time to tell the story of the frozen humanoids. How and why were they frozen? This part of the story also explains the fall of ancient Sapey and the birth of the Sapiens. Can those from the past be able to coexist with those from the present?

Hive: Future of Social Media

Spectrumecons on the Hive Blockchain