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Money is information. Money was invented to symbolize value in trade exchanges, e.g. to buy a cup of coffee, rather than bringing something of equal value to barter we transfer money to the coffee maker. Money is the social token that facilitates the trade. So just as Monopoly money has no value outside the game, dollars have no value outside society, e.g. to a man dying of thirst in a desert, a glass of water is worth more than a $100 bill. Over time, money as a means to increase synergy became an end in itself. We have images of Walt Disney’s Scrooge McDuck gleefully diving in his piles of money, but today billions are just a number on a computer screen. Thanks to technology, we are on the way to a cashless society, as cash is rapidly becoming obsolete in urban China. Now people pay by waving a card or smartphone, showing that money is a not thing in itself but is, and always was, just information. Making profit the goal is a mistake, because it distract people from the original goal of synergy. Profit corrupts health, education and politics by making people forget their real purpose.

Hunting and gathering information. Companies on the Internet are the hunter-gatherers of the information age, who just take and move on. They gather data and hunt attention using AI tools but the tactic is the same. Yet just as harvesting a field year after year reduces yield, so endless ads stealing attention kills the social environment. Profit seekers take and leave regardless of their effect on the environment, thinking “I will move on so it doesn’t affect me“. Yet as humanity is now global, there is increasingly nowhere to run from the effects of our own activity, as climate change illustrates. The only sustainable way is to cultivate and stay rather than take and leave. We need to give and take, not just take.

The opposite of profit. The opposite of profit is not non-profit, which is just trying to break even. The opposite purpose to profit, or benefiting yourself, is to benefit others. This is not just charity, the rich giving to the poor, but cultivating synergy, e.g. Airbnb, an online service for people to rent short-term lodging like holiday cottages, apartments and home-stays cultivates synergy but is not a charity. Some say “Who would have thought that letting everyone be a hotelier would work?” but the synergy was always there for a global community. Likewise Uber succeeded by letting everyone be a cab driver. Cultivating synergy is not about redistributing wealth but finding positive synergies between people in a community.

Cultivating synergy. In Internet terms, to cultivate a synergy means to help other people, or help people to help each other. For example, tech sites like AnandTech let people with a hardware problem go online to find another person who has already solved it, so what might otherwise take days to solve is solved in seconds. In this synergy, everyone shares and everyone gains. Arpanet, the Internet’s predecessor, was built on the idea that computers worked better together than alone. The Internet was founded on synergy and so has encouraged alternatives to traditional give-take trade:

• Give the basics. Many online enterprises offer a free basic service then charge for a premium version. Letting a person try out a product creates trust and if they want more they can pay, e.g. WinZip gives free file compression to people while charging businesses, Skype did the same for phone calls and Dropbox did it for storage. Imagine a hospital that offers basic services for free but if you want an extra test or operation you have to pay. Parking places that don’t charge for stays under 15 minutes work because more people using a service that doesn’t rip them off.
• Build, use, then give it away. The Internet has many examples where people say “This code solved my problem but feel free to use it.” This works because the effort already paid for itself and it costs nothing to share information. The Creative Commons licenses, written to let people freely make creative work public (synergy) if receivers do not copyright or sell it (defect), are now given away freely themselves.
• Give to each other directly. Advertising claims it is the only way to pay for services but that is not true, as Wikipedia has no ads. When Wikipedia needed money, Jimmy Wales just went online and asked and the community responded! This is people synergizing directly and bypassing money entirely. Coding communities like GitLab or BitBucket illustrate that people working together directly works, as the benefits are immediate and systems with no money have nothing to steal. Yet as they grow, they need money for infrastructure, either by sponsorship, ads or member donations.
• Open source software. FLOSS (Free, Libre, Open Source Software) is a community working together to create a free product for all, e.g. Linux, Mozilla Firefox, Thunderbird, Open Office and Gimp. When the source code is openly shared, people help improve the software, as Eric Raymond’s The Cathedral and the Bazaar explains.
• Take a cut of synergy benefits. Online sellers like eBay and Amazon make money by taking a cut of every sale. While newspapers charge for ads whether they sell or not, the service is free until you sell. Again not always taking a profit is a better strategy, as then more people participate.
  
• Give then take later. Cultivate then harvest is the long game played by companies like Facebook, Google and Twitter, to first give free service and then find a way to make money. The current preference is by advertising but not as you know it on TV. Their ads don’t grab attention as pop-ups or flashing banners but sit where one can ignore them easily, i.e. are polite. Google ads are targeted based on your search terms, so if you Google sports shoes you get ads on sports shoes, which is more relevant than on TV. In contrast, Facebook has to read your posts to target ads. 

All the above make money in some way to survive but it no longer comes first. Online systems today differ from business tradition (Kolbitsch & Maurer, 2006) in following Rule 3b, to do good first. The result has been a huge increase in people helping people. The profit motive is not dead but it is no longer the king. Technology has changed the focus from profit first to synergy first, but the temptation, as always, is to become “evil”, i.e. to take more than one gives.

Who is the evil empire? In the Star Wars movie, the evil empire tried to control and dominate all resources and people. Someone should write a history of Silicon Valley called From Idealistic Startup to Evil Empire. Microsoft was the classic garage startup that within a few decades became an evil empire based on its reputation for aggressive digital rights control and dirty tactics against rivals like Netscape. In 2000, this led to a Department of Justice anti-trust action that nearly destroyed the company. Bill Gates had to testify before Congress and was chastised. Today, as giants like Facebook, Google, Apple and Microsoft dominate their respective domains, each is tempted to be the next evil empire, e.g. instead of injecting 99% useless ads into people’s feeds, Facebook used AI to analyze people’s posts and messages to get targeted ads, allowing its software to spy on people to profile voters in the Cambridge Analytica scandal. Like Bill Gates, Mark Zuckerberg had to testify before Congress that “We do not sell user data”, even though selling advertising access based on profiling is much the same thing. People want to link to family and friends not be probed by a sales algorithm. As Chris Herd says:

I don’t want to sell my soul to an advertisement machine designed to hijack my attention and exploit me.

Facebook lost trust with this affair, as to be evil is to lose social support. Those who abuse others are exposed, shamed and banned – lest this be considered toothless, consider how social media pressure ended Harvey Weinberg’s career in months, when a law suit would have taken years and still probably failed. Society is always the elephant in the room, so Jared Lanier’s Ted talk warning that the Internet needs to avoid the dark side should be heeded.

Good is good. When Google began in 2000 Microsoft was the evil empire, so it took the motto “Don’t Be Evil” and today its motto is “Do the right thing“. Likewise Facebook began as a free service to link family and friends, i.e. also began doing good. Doing good created their success and now over 80% of referral traffic comes from these companies. They seem too big to fail but every Internet customer is just a click away from emigrating to a better place. The society that defines their success will abandon them if they abandon it. They survive by their good name, and Google services like GMail, translate and maps help this. The profit mantra that “Greed is good” is giving way to the social mantra that “Good is good“. 

The principle of enough. History is told as a tale of power but progress is about changing people’s hearts and minds. As long as people make profit their primary purpose, nothing will change. It is true that without profit one cannot survive, but what about after that? Does one then seek more and more profit? This is when profit goes wrong. If the goal is profit there is never enough, but after getting enough profit doesn’t matter anymore. Bill Gates realized this when his wife asked him to give his billions away instead of making more. The consumer ethic brainwashes us to believe that we must consume to be happy but this is simply not true. Money increases happiness up to a point after which it has no effect. Why get more money than can be spent in a lifetime? Beyond profit, only giving to others increases happiness. The desire to consciously contribute to the world sits above the desire to profit for oneself. As people go beyond the profit motive we can imagine a society that follows Kant’s imperative – to do the right thing regardless of personal benefit. The sign will be when the rich list is a list of shame not envy. When people have had enough of profit, the synergies beyond it will emerge.

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The golden rule is to do “right” regardless of personal benefit. This doing good without seeking a reward can be called free-giving. Free giving is free in the sense that the giver acts freely and is not forced, bribed, tricked or directed to do what they do. It is giving in the sense that it benefits others. So while people working for money may benefit others and those making money in a market inadvertently help others, as Smith argues, they are not free giving. They are giving with conditions whereas free-giving is giving without conditions. And in history, the actions that advanced humanity, were those done freely not personal benefit, even against opposition. They were acts of free-giving.

Heroes of society illustrate free-giving. Many people have literally given their lives to create civilization today. Socrates, the father of modern science, asked questions freely and in the end was sentenced to death for “corrupting the young”, yet his pupils Aristotle and Plato planted the seeds of the later scientific revolution. All heroes freely give, e.g. Tolkien wrote the Lord of the Rings in his free time while teaching philology at Oxford. His book was thought unpublishable at first and generated most of its value after his death. It made society rich not him. Likewise although Mozart needed money to live, he did not compose his music for that reason, just as Van Gogh painted even though he only ever sold one painting. Scientific heroes like Newton, Galileo, Darwin and Copernicus all had to eat but they didn’t do what they did for money. The point is not that money doesn’t matter but that people who freely give of themselves to society are heroes.

Personal benefit does not explain heroes. Neither Rule 1 (compete) nor Rule 3a (compete by the rules) explain why heroes happen. The people who enabled the benefits we enjoy today, whether of science, engineering, art, music or any other endeavor were driven by motives beyond personal gain. There is no other way to explain what they did. They wanted to give their vision to everyone, which is to say they wanted to help others. This then is Rule 2, an inbuilt urge to help the social group not just oneself. These two age-old motives of self-survival and community survival combined into the current dominant capitalist Rule 3a, to compete by the rules: to maximize profit while doing the social minimum of obeying the law. The alternative Rule 3b mix is to give and survive: to maximize social benefits while taking for yourself only what you need. Rule 3b reverses the logic of Rule 3a, to put synergy first instead of profit, to give the small heroes of society.

Societies succeed by small heroes. Not all of us can be heroes but there are many small heroes, people who help others for no reward. Every mother or father who cares for a child knowing they will leave them is a small hero. You see it when lost in a new city and some stranger gives you directions, knowing that they will never see you again. It is a fact that people will help others for no benefit to themselves. Such gratuitous acts of kindness are essential to any social success because they encourage the trust necessary to enable synergy benefits. Profit-based measures of social success like Gross Domestic Product or GDP measure the consumption of goods and services but ignore social health, e.g. national disasters like earthquakes or forest fires increase GDP but volunteers helping others for nothing don’t. Social performance is more than GDP, leading to calls for measures of national well-being. What makes a society worth living in is small heroes who are willing to freely give to others. 

Social technologies enable small heroes. Today, technology lets us all be small heroes, to help others for no reason. We can add a page to Wikipedia, tweet against injustice or give to Kickstarter, a funding platform for creative projects.  The technology that creates spam also enables free-giving. Good acts cascade just as criminal acts do, as the movie Pay it Forward suggests. Technology now lets small heroes join together to create more than any past hero could alone, e.g. In 1755 Samuel Johnson took seven heroic years to write his influential Dictionary of the English Language, but today 20 million volunteers wrote the four million articles of the English Wikipedia that equates to about 1,000 books with 1,200 pages each. Small heroes did what no individual could ever achieve. Even BitTorrent, a community where people download pirated web content for free, survives only because people give to others. Consider Wikipedia’s business plan: to ask unknown people to freely contribute their expertise to create a free encyclopedia for everyone. It only worked because small heroes exist.

That technology supports “virtue” is an important discovery. Socio-technical systems succeed not just by technical efficiency but because the invitation to do small virtuous acts of community service is taken up (Benkler & Nissenbaum, 2006). Technology allows online synergies but they would not happen if people didn’t respond. Egypt’s pyramids show that autocratic rule can direct people to work for others. Markets show that one can incentivize people to get synergy within a contextual legal system. What we did not know until the Internet was that people not directed or incentivised will freely synergize. We knew people could be forced or enticed to help others but not that they would freely do so.

This is not communism because individuals are free to act without social control. It is not capitalism because the primary goal is not personal profit. It is not socialism because individuals can take from the community and not give back. It is not anarchy as there are anti-social defenses to oppose disorder. It is not altruism as no-one has to sacrifice for the society. Modern social technical systems illustrate new social designs based on small heroes freely giving to others.

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   Technology magnifies human choices but doesn’t make them. Last century, nuclear technology increased the physical power of war until the major powers had to choose to destroy each other by nuclear holocaust or not. Technology didn’t change the nature of war, which was always to lay waste, it just upped the ante. Mutually assured destruction (MAD) made clear to everyone that world domination was an inevitable all-lose endpoint. America and Russia chose not to destroy each other but the choice was made by people, not technology. Hitler’s myth of world control was seen for what it was – a pyramid scheme based on conquering countries, pillaging them and moving on. Just as financial pyramid schemes inevitably collapse, so Hitler’s scheme never produced anything but the collapse of the synergy of civilization.

The myth of profit. The myth of profit is that one can get profit for nothing. If profit is the goal, the ideal is to get it for nothing: Enron, World Corp and the credit meltdown banks all sought just this. Yet just as perpetual motion contradicts physical laws, so perpetual profit contradicts social laws because just taking from others isn’t sustainable. Today, we laugh at medieval efforts to build a perpetual motion machine but still believe in the myth of perpetual profit. If we use the power of technology solely for personal profit, a global social collapse is inevitable over time. The profit motive increases the gap between rich and poor and this is a recipe for disaster. As with nuclear weapons, technology has just upped the ante, as now we can collapse synergy not just for one country but for many.

   Profit and the Internet. When businesses first encountered the Internet many saw as a way to get rich quick. Then the Dot-Com collapse showed that people online were not as gullible as supposed. The Internet illustrated the flaw at the heart of perpetual profit – that no business can survive on stupid customers. If people could be manipulated to give away their money foolishly, they would soon go bankrupt and so no more be customers. A few con men can feed off a stable society but a con-society can no more succeed than a colony of parasites feeding off each other. At first e-commerce seemed like a sure thing, as both customers and companies benefited, but without trust this synergy was not possible. Online sales did not take off until sellers like Amazon and Ebay built up trust. Companies like Google and Facebook were even more daring: they used cheap technology to give a free service as per Rule 2 (give to others), built up a client base of millions, and then looked to profit as per Rule 1 (take for yourself). This give now, get later approach has worked brilliantly. The Internet way is to first get trust by offering some free service and then look to profit. In this give and take, synergy comes before profit.

   Advertising steals people’s time. In the old days, a thief would steal your money but today advertising steals people’s time. Why else are TV ads louder than the program content? If to watch an hour of TV I have to watch a half-hour of ads for products I dont want, it wastes my time. And ads often promote what harms me, like eating bacon and cheese burgers (obesity) or taking pain killers (the opioid crisis). As ads waste their time, people mute them or flip to other channels, so more ads are needed for the same effect, making the problem worse. As a result, the advertising that funds TV is slowly killing it. Young people dont watch TV because the Internet gives more for less time. Unfortunately now what killed TV for people under thirty is doing the same to the Internet. It started with popup ads that people learned to close without reading and now to watch a video you have to ignore a video ad first. Often half the screen is ads, and just as you start reading the article you came for, a pop-up interrupts to ask for something. On some websites, you get a video of someone in a loud voice selling something! Advertising is the slash and burn of the information age, because when ads grow like weeds, people stop visiting the garden. 

   Profit alone is not sustainable. Profit seekers are the hunter-gatherers of the information age who take and move on. This is not sustainable. To advance, the Internet needs cultivators who give and take fairly. The signs that profit corrupts are everywhere in developed society. Hospitals trying to make money run every x-ray, consult every specialist and give every pill “just in case”, giving a profit from sickness system not a health system. Pharmaceutical companies pushing pain pills for profit has created the opioid crisis, making them the biggest drug dealers in America. A food industry that peddles burgers instead of tobacco has created an obesity “epidemic” that kills more people than tobacco ever did. Academia is now about publications and grants not truth, so industry can buy “research”. Politics is now about money, as lobby groups give politicians no choice but to buy in or sell out. Selling as many guns as possible has made America the world leader in gun deaths. From gambling in sport to stock market scams, the profit motive is leading human society astray. The profit motive is reaching the end of its useful social life because as an ideal, it is not sustainable.

   The profit motive end state. To understand the inevitable end state of the desire to profit, consider this story:

A man who worked hauling goods with a donkey had trouble making ends meet. He complained about this to a friend in the pub who told him he needed to improve efficiency by cutting operating costs. So the next day, instead of giving the donkey ten carrots a day he gave him nine. Since it then did as much work for less carrots, he believed the consultant and did the same the next day. A week later his friend found him again sitting miserably in the pub and asked what was wrong. The man replied: “Feeding him one carrot less each day worked well until he died. What bad luck! I nearly got him working for no carrots at all!” The man failed to see that he and his donkey were in a symbiotic relation.

   In this story, workers and customers are the donkeys that generate value and businesses seeking profit are the foolish owners that eventually kill them off. P. T. Barnum is reputed to have said “There’s a sucker born every minute” but today hi-tech firms need people not donkeys, hence Google gives its employees half a day a week to work on personal projects. A university provost complained that “Managing faculty is like herding cats” but hiring cats for their creativity then trying to herd them makes no sense – if you hire cats you should put out milk. Semler details how his company raised productivity by treating employees as people not donkeys (Semler, 1989). Clearly there is something at work beyond profit, as online systems like eBay treat customers not as the competition but as part of the business. Conscious capitalism is the explicit statement that good businesses give back to the community. Social level business models ask not how to dupe customers but how to work with them, because treating others as synergy participants generates value. The next section looks at how the Internet answers the biggest question facing humanity today, namely “What is beyond profit?“.

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The synergies of civilization can be linked to the golden rule:

“Do unto others as you would they do unto you”

This rule has been expressed in many different cultural contexts:

1.   Rabbi Hillel’s sum of all rules: “If you don’t like it done to you, don’t do it to others”.

2.   Kant’s proposal: “Act only on that maxim by which you can at the same time will that it become a universal law”, i.e. if everyone does it, is it still successful?

3.   Pareto’s optimality principle: “Good actions benefit at least one other and do no harm.”

4.   Rawl’s “veil of ignorance” requires state laws to be “blind” to individual needs.

5.   Harsanyi’s utilitarianism that what makes a positive contribution is moral (Harsanyi, 1988).

  All of the above oppose social defections, i.e. anti-social acts. Conversely anti-social acts fail all the above tests; e.g. Hillel rejects stealing as one does not wish to be stolen from, Kant finds it wrong because it does not work if everyone does it, and Pareto rejects it because it harms another. Laws that operate from behind Rawls’ veil of ignorance cannot enable stealing because they don’t know who is who, and finally Harsanyi finds stealing an immoral act because it is overall not a positive contribution. The Golden Rule has in our past taken many forms.

  The golden rule sits above the individual economics of game theory. Kant distinguished categorical imperatives from hypothetical ones, i.e. the rule is not “Do unto others so they will do likewise unto you” because such “deals” are merely instruments to individual benefit. Kant’s imperative is to do what is categorically the right thing to do, regardless of the outcome for oneself. He advocates operating on a higher level than one’s small self. The golden rule asks free people to act beyond their own interests, hypothetically to flip every social interaction equation to see if it still works the other way, to stand in the shoes of others and to think of the society as a whole. They suggest a solid universal social principle that is equally applicable to information technology (Siponen & Vartiainen, 2002).

  The social environment model frames this call as not just to “goodness” but also to productivity. The ethic of serving a community is logical because Rule 2 is just Rule 1 applied to the social instead of the individual unit. Higher social levels are more productive because synergy works. Ethics is just pragmatics at a higher level. Rule 3 rejects stealing because overall it is a loss to the social group, e.g. when a wallet is stolen there is not just the money lost but also losses like the cost of replacing credit cards. Based on the golden rules, the ship of human society has navigated a middle way between the evolutionary dead-ends of endless tribal conflict and mindless social conformity. The struggle began thousands of years ago, at the dawn of the agricultural revolution, when “civilized” farmers cultivating the land battled “barbarian” hunter-gatherers, whose essential code was:

“Take what you can and give nothing back.“

This was a recipe for smallness. Perhaps reason pulled us out of the dark ages but reason was too fragile to get us across this original zero-sum barrier (Whitworth, Van de Walle, & Turoff, 2000). It needed faith and religion. The first religion, over seven thousand years ago, seems to have been from the Persian Zoroaster, who called upon his “people of the flock” to listen to the “immortal shining ones” and do right not wrong. As he put it:

  He who abhors and shuns the light of the Sun,
  He who refuses to behold with respect the living creation of God,
  He who leads the good to wickedness,
  He who makes the meadows waterless and the pastures desolate,
  He who lets fly his weapon against the innocent,
  An enemy of my faith, a destroyer of Thy principles is he, O Lord! (Ahunuvaiti Gatha; Yasna 32, 10).

Indeed in the beginning, religion was about pulling humanity out of the slavery of desire into making free choices.

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In Figure 5.4, the vertical ellipsis “other social levels” means a social environment can be inside another, e.g. as many people can form into a company so many companies can form into a stock market. The company is a social group to its members and the stock market is a social group to its members, with both social systems adding synergy. Companies reward employees with pay, and stock markets reward companies with public investment based on their share prices. Equally, both environments place synergy requirements on members: companies ask employees not to steal their product value (stock) and stock markets ask companies not to falsely report profits.

Rule 3 can be universalized to the multi-environment case where S1 contains S2 …:

Rule 3’a: If {{SU1(ai) ≥ SU1(aj) or SU2(ai) ≥ SU2(aj)… } and IU(ai) > IU(aj)} then prefer ai to aj

In words: Choose acts that do not significantly harm higher environments but benefit oneself.

OR…Rule 3’b: If { IU(ai) ≥ IU(aj) and {S1U(ai) >S1U(aj) or (S2U(ai) > S2U(aj)…}} then prefer ai to aj< >

In words: Choose acts that do not significantly harm oneself but benefit higher environments.

A social dilemma solved for one social level can reappear in a higher one. When the same social dilemmas operate at higher social levels, “new” problems arise; e.g. the Enron debacle, with estimated losses of over $60 billion, occurred when Enron executives cheated the stock market by reporting false profits to raise their stock price. Other companies laid off staff to “compete” with Enron’s imaginary profits of over 80%. Within the stock market social system, Enron defected on the rule by which the stock market creates synergy, as if everyone made false claims, no one would invest. If false reporting had not been illegal before Enron, it would have to have been made so, for the stock market to survive. The stock market, a higher social system, had to act against the Enron cheats or collapse itself. Enron was just cheating on a higher social level.

Greed is not good. In this model, competition is good but not always, e.g. if business did operate by pure competition (Rule 1) then Enron’s innovative methods of obtaining value in the stock market environment would have been a competitive advantage, as would have been their paying zero U.S. tax for seven years. The business maxim “greed is good” does not apply to defecting on a social contract. Cheating one’s colleagues is not a “competitive advantage”, as its bottom line is a loss of value for the whole society.

All higher social defections involve hypocrisy, e.g. Enron bosses hypocritically asked workers to serve the Enron company environment while themselves cheating Enron’s social environment, the stock market. Likewise gangs like the Mafia demand strict loyalty and service while as a group pillaging the community at large. In general, a social rule that does not apply at every level creates an inconsistency that must eventually be resolved, e.g. it is inconsistent for member states that do not give their citizens democratic rights to have democratic rights themselves within the U.N. assembly.

Wildlife conservation in Africa illustrates the importance of acting at the right social level. Poaching is a classic tragedy of the commons case, yet public ownership has generally been a disaster for conservation in third world countries (Ridley, 1996). Under nationalization, the government could not stop locals poaching the large animals that damaged their crops. The trend was only reversed when wild-life titles were “privatized” to local communities, like the Campfire program, where hunters purchase the right to kill game from local villages (Ridley, 1996, p.236). When the village “owned” the wild animals, it looked after its resources, prevented members poaching and wildlife numbers grew. In contrast, whales roam international oceans not owned by any country so we could hunt them to extinction. If a global humanity owned the whales it would be as foolish to hunt them to extinction as for a farmer to kill all the cows in his herd. Perhaps whale killing rights should be “privatized” to nations, who would then physically prevent whale poaching in their zones.

Rule 3 can be generalized to define categorically good acts as those that give value “all the way up”, not just for oneself, but for the community, for humanity, and even the planet we live upon. The principle that there are levels of “good” was made clear in the Nuremburg trials—where the defense “I was following German law” was rejected and they were convicted of “crimes against humanity”, i.e. held to a higher standard of right and wrong. If social environments are within a world environment, is the higher good to serve the world not society? Those who recognize that the disastrous effect of human beings on our rivers, forests, animals and air would agree.

Yet to be the devil’s advocate, if Rule 1 is to meet the world’s requirements is not following it then the higher good? It is not so because the motive is not to help the world but to help ourselves. It is individuals seeking their own gain not that of their environment and if the latter evolves they are unconscious of it. Yet it is true that innumerable animals have lived, fought, reproduced and died with no idea at all that behind it all there was an evolution of life on earth, which after billions of years produced us.

To unconsciously contribute as unknowing grist to a mill is not acting for a higher good. Only to consciously contribute to a higher environment, as Rule 2 proposes, is acting for a higher good. This is why Rule 2 is the ethical rule. We may conclude that the highest good is to recognize the requirements of the highest level environment while still living in lower ones. Thus I can see myself as a citizen of New Zealand, a citizen of Humanity, a citizen of the Earth, or a citizen of the Universe. The ideal is to serve the highest environment one can conceive while surviving the demands of lower environments.

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Social inflation occurs when a social environment insulates its members from the demands of its environment. This is not sustainable, as outer environment demands ultimately “cascade” over inner ones. Social environments that ignore the demands of their environment experience social inflation, as the value of the tokens it gives to members lose their external value. Monetary inflation illustrates this, as money (a social token) loses value relative to world standards like a loaf of bread. Grade inflation occurs when professors give all students A grades regardless of competence, and the token “A grade” loses value in the University’s environment, i.e. with employers. Internally giving high grades seems to benefit everyone, as grading is easier, students are happier and high pass rates attract more students. Yet externally it gives no value to the society at large, so it is unsustainable. While crime and corruption deny the requirements of the social environment, social inflation denies the requirements of the world environment. It builds gradually like a choir slowly going off-key together, but ends suddenly in the failure of the social unit due to an external rectification.

A social unit that does not satisfy the demands of its environment creates an external rectification.  World events like the great depression and the world wars were external rectifications, as was the 2007–2008 global financial crisis. This world gives gains at the cost of risk, but then banks and credit companies began offering loans regardless of risk. Internally this seemed to benefit everyone—lenders got more interest, borrowers got needed money and bank popularity increased. As some banks increased lending, others followed suit to keep in the market. Finally, when companies could not recover their loans, the banking social system collapsed.

The expected result of letting an external rectification run its course is the collapse of social synergy. In the 2007–2008 global financial crisis the global credit system started to collapse. The likely results was another depression possibly accompanied by conflict or war. Knowing this, the US and other governments stepped in with billion–dollar bailouts to restore trust. Yet without an accompanying internal rectification, this would only delay another inevitable external rectification because no social system can deny its environment. In the social environment model, a social system must not only demand synergy from its members but also pass on the requirements of its world environment to them.

Businesses leaders who cheat society of billions are removed but what of the banks who lost even more money by incompetent risk management? Both cases are social errors, but while crime is about a lack of social ethics a financial collapse is about world incompetence. If the same people who cause a credit collapse still draw bonuses based on their business “skills”, no correction has been made. In the social environment model, the 2007/2008 financial collapse was a higher level of incompetence. A society need not punish bank leaders for negligence but should remove them for the same reason it removes criminals— for the good of society.

The 2007/2008 financial collapse shows that private businesses require government control. When Wall St’s credit froze, through its own errors of judgment, the government stepped in to pay the $700 billion heating bill for the public good. Similarly, when the naughty boys at Enron played with the matches of cheating and nearly burnt down the market house, the government had to again step in for the public good. To expect state bailouts in hard times but no state control in good times is like a child who wants to be left alone but still expects its parents to pay the bills. If public good is important then it is important all the time, not just when there is trouble. If in times of trouble the nation pays the piper, then in times of plenty it can call the tune. For corporate cheats, it can set public-good rules of financial disclosure or rule that no company can pay zero tax. For corporate incompetence, it can replace the incompetent by those with real skills. Any society that fails to act in its own interests in such ways invites its own collapse.

Crime arises when citizens are under-socialized and social inflation arises when they are over-socialized. When an organization becomes over-socialized, it becomes:

a)   Bureaucratic. People follow social rules regardless of practical consequences. When rule following is the primary directive, the group becomes externally incompetent.

b)   Image focused. When social appearances supersede practical skills, people with fake qualifications can get high positions. As image wins over substance, the group becomes incompetent.

c)   Reality denying. Outside problem “shocks” are covered up or denied rather than dealt with, and whistle-blowers who point them out suppressed or fired. No competence learning occurs.

d)   Political. Members are too busy with internal power struggles to attend to outside problems, so the group handles them poorly.

e)   Negatively driven. Socialization works by applying negative sanctions, so avoiding them becomes the key to advancement. Leaders practice non-failure not success. Yet budget cuts and monitoring are no substitute for incentives and a positive vision. Negatively driven citizens become submissive or apathetic.

All of the above are maladaptive because they try to use social means (rules, image, conformity, politics and sanctions) to achieve competence goals. This does not work, as the solution to incompetence is competence, which is not created by rules and regulations. Competence is increased by allowing rule breaking, image deviations, criticism and giving incentives for results. Social performance is not achieved by enforcing social rules alone.

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The conflict between capitalism and communism that dominated the last century was a conflict between Rule 1 and Rule 2. In capitalism, competitive value (Rule 1) was taken as primary while in communism Rule 2 was taken to be primary. The conflict between communism and capitalism was based on the premise that these two opposites are the only alternatives. The debate only continues because the advocates of Rule 1 or Rule 2 cherry-pick cases to support their doctrinal position, e.g. some now say that capitalism “won” but America is not, nor has ever been, purely capitalist. What won was the combination of communism and capitalism.

In the social environment model, Rule 2 is just Rule 1 applied to the social environment instead of the larger world environment. Since both environments exist, the model predicts that the best option is to apply both rules, and this has happened. China today is no more purely communist than America is purely capitalist. People are seeing that a society that produces a lot and shares it unequally is hardly better than one that produces not much and shares it equally. Capitalism focuses on individual productivity via markets but still needs fair laws, while communism focuses on community sharing but still needs individual growth. Framing the choice as between the unequal distribution of wealth or the equal distribution of poverty, between individual productivity and community synergy, is a mistake. This model advocates both high personal productivity and high community synergy.

Adam Smith linked individual to public good by suggesting the “invisible hand” of the market (Smith, 1776/1986), as the harder people work for themselves the more value they generate for the community. Yet Smith’s argument for competition was not an argument against cooperation, nor did he present it as such. He assumed a social context of common good rules. For exampled sport is competitive but referees are needed to penalize illegal acts. Likewise “free” markets don’t work when there are no common good rules, e.g. against insider trading. As sociologists argue, individual economics only works when it is embedded in a larger social context outside any competitive framework (Granovetter, 1985). Playing fields and competitive environments work best when level.

The social environment model supports Smith’s link but also lets it work the other way, i.e. just as competition can support public good, so public good can support competition. To contrast the two is like arguing that mother is better than father or father is better than mother, when really both together are best. If capitalist models had recognized synergy, businesses like Microsoft would not have found Berners-Lee’s World Wide Web “uneconomic”.

Rule 3 combines the capitalism of a society of self-interested competitors and the communism of a society of ant-like cooperatives. That citizens help both themselves and society is neither pure capitalism (Rule 1) nor pure communism (Rule 2). If pure communist societies have lower productivity and pure capitalist societies lower socialization, a hybrid will perform better than either alone. This predicts that communist countries will move to acquire a business face and capitalist countries will move to increase public good, which is what has happened. Both these apparent opposites have met in the middle to be indistinguishable, so now there is not much difference between “communist” China and “capitalist” America. The myth that some are entitled to perpetually skim a percentage of the labor of others is seen as just as false as the myth that everyone is entitled to do nothing and be supported by others. In this model, the invisible hand of market competition works best with the visible hand of public good.

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Social health is the degree to which people in a society support synergy. Social evolution requires a certain degree of social health, e.g. citizens who can’t even conceive of freedom are unlikely to achieve it. Hence the invention of democracy had several false starts before succeeding, e.g. the French revolution gave the people freedom, but giving a long oppressed people sudden freedom by violent means resulted in anarchy. The French Revolution was followed by The Reign of Terror, then the rule of the autocratic Emperor Napoleon, i.e. the social system devolved first to anarchy and then back to a dictatorship. Yet when America and England tried the same social evolution, it worked and today it is unclear why our predecessors ever settled for less. The answer proposed here is social health.

The synergy of a society depends on the social health of its citizens. Democracies out-produce autocracies because they produce more and online is no different (Beer & Burrows, 2007), and they produce more because freedom increases competence and legitimacy increases social synergies. Social evolution requires citizen evolution because it depends on how people see others and themselves. Social health has also been called social capital, defined as the “… norms and networks facilitating collective action for mutual benefits” (Woolcock, 1998).

Unlike ants, people have to learn to socialize, e.g. young soccer players trail the ball like a cloud of insects, as each tries to individually get the ball and score a goal. As a result, they get in each others way and the team results are poor. Only with social training do players learn to play positions like forward or fullback, and engage in social acts like passing the ball for the team. People are no more born knowing how to work together than they are born knowing how to kick a ball – they have to learn it. Social health is thus a product of upbringing and education.

As one can measure individual skills, so one can measure social synergy, e.g. if a group offers cheap coffee on an “honesty” system of 25¢ per cup, what percentage cheat and take the coffee but leave no money? If everyone defects and takes the coffee for free, the synergy (and coffee) fails. Fast-food chains in different suburbs illustrate that the synergy of self-service doesn’t always work. A self-service system lets customers help themselves to tea, coffee, milk and sugar etc. This speeds up the service considerably, as servers just give customers a cup and leave the rest to them. Yet when McDonalds tries to do this in an area where social health is low, for whatever reason, customers loot beverage resources like sugar and napkins. To stop this, goods must be kept behind the counter and handed out, giving long lines as servers must pour the milk and get the sugar for each customer. Similarly, the social invention of supermarkets required a certain amount of customer social health. Traditional shopkeepers kept goods behind the counter to prevent theft. Only when most customers do not steal, can goods go out on shelves for customer self-help, improving efficiency enormously.

The percentage who defect on social synergies affects social performance. As online communities depend on synergy, social health is equally important online. Online social systems are subject to natural selection, as people flow into communities that perform and out of those that do not. A physical barrier like the Berlin Wall can stop flows for a while but even it was unsustainable. In an Internet without borders, people join and leave communities with the click of a mouse.

Online communities can improve their social health; e.g. by a constitution that members accept as they register, by routine posts to remind people of ethics, or by moderation. People then learn what is best for the group. If senior members help new members, the newcomers are more likely to give back. Banning trolls also raises the social health of the group if not too oppressive. Regular feedback of a group defection measure, like the number of posts deleted by moderators, would raise social health awareness and improve social performance.

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A social invention is when society discovers a new way to increase social performance. Individuals in a world environment attribute their results to their acts, but in social environments most of our gains arise from the acts of others. Societies therefore invented accountability, that we are responsible for the effects of our acts not only on ourselves but also on others. Who actually discovered this is lost in the mists of history, if it was even one person, but even so it was an invention, a social invention.

Forming a social unit engages synergy but disconnects people from the direct consequences of their acts. Justice—punishing unfairness—is one way for a community to restore this. Unfairness is here not merely inequity—the unequal distribution of outcomes—but distributing outcomes according to contribution. For example, consider the following story:

An old Zen master worked in the community garden. His pupils told him he shouldn’t work due to his age. He continued to do so, so one day they hid his garden tools. From that day he didn’t eat. Scared their master might die, they returned his tools. As he raked the lawn again he said to them: No work, no eat. He knew that it is wrong to take without giving.

Studies suggest that people intuitively recognize justice and so tend to avoid unjust situations (Adams, 1965). People even prefer fairness to personal benefit (Lind & Tyler, 1988), while chimpanzees are simple outcome maximizers who follow Rule 1 entirely (Jensen et al., 2007). Criminals destabilize society, but justice changes the dynamic by punishing unfair acts. If individuals seek revenge on those who “wronged” them or their family, cheating is unprofitable over time, as today’s defection is paid back with interest tomorrow. If a society can make unfair interactions a bad choice, selfish people will prefer mutual synergy to mutual conflict, i.e. justice aligns individual good and social good. Unfortunately, in “an eye for an eye” cultures one revenge act creates another, giving endless vendetta cycles, as in the Middle East. Revenge was the precursor of modern justice, as individuals administered justice personally, rather than leaving it to society. The case has been made that our entire justice system of police, laws, courts and prisons aims to deny unfair acts (Rawls, 2001).

People often fail to see how the community level operates. A theft is “good” for the robber but is bad for the community. If someone steals $100 and is caught penniless, a court may sentence them to a year in jail, but if the police, trial and incarceration costs are over $100,000, and the robbed get no return, a “rational” person might ask “Where is the value?” If everyone loses, why waste money prosecuting? The error is to apply a personal perspective to a social level problem. For a community, $100,000 may be a small price to pay for social order. The state works at the community level not the individual level; e.g. depression reduces productivity but no laws deny it because it affects people not communities.

Social rules are about changing social interaction contingencies, not individual profit or loss; e.g. the 1980 clean up of New York crime changed the social environment, from one where shootings were common to one where it was safe to walk the streets. The increased productivity of an entire city was worth the effort. Spending thousands of dollars in police, court and prison costs to prosecute a hundred dollar theft is a good deal on the community level, as successful crimes create copycats and one defection can snowball into a social collapse, e.g. if a fast-food restaurant is kept clean people drop less rubbish, but if it is messy they drop more. So it is less work to keep an area fully clean than partly clean due to social factors. Giuliani’s clean up of crime in New York cost millions but generated a synergy gain of billions because it followed Wilson’s Broken Windows Theory.

Democracy was the social invention that a community selects its leaders by vote rather than physical conflict (Mandelbaum, 2002). The conflict now occurs on the information level rather than the physical level. Democracy vests the power to control the community in the community itself rather than a king or dynasty, so democracies also tend to limit terms of office. A dictatorship has a center to hijack but a democracy that distributes control to the people does not. This turns out to be better than trusting central elites, however benevolent, not because it is more efficient but because it allows anarchy free transitions of power. Given a human history of bloody power struggles, it is always amazing to watch a democratic leader peacefully hand over control to a successor, such as when Bush handed over power to Obama.

Democracies combine individual freedom, social order and resistance to hijack. They produce more because free people contribute more work, more ideas and more research. They also self-regulate more, reducing security costs (Tyler, 1999). The allied democracies overcame the Axis dictatorships in World War II by producing more as well as fighting better. Democratic nations have increased over time not because democracy is “nice” but because it is productive. Note that currently China is challenging this ideal with the idea that a benevolent “emperor” is better, as Plato declared.

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