National Accounts of the Commonwealth

Part of the state series of articles.

Summary

• The Commonwealth accounts for ✦ revenues in its economy in four sectors – the commons, firms, the state and the foreign sector.
• Because residents don’t handle money in ordinary life, they neither earn nor save. Their lives are provisioned by the commons, which carries the difference between labour value and cost as a debt.
• Firms in the country have uninvested revenues collected, and so they do not accumulate money.
• As such, the state subsidises the commons through collected revenues and the rest of its net lending is the current account, spent on foreign assets under Handshake Accounting.

Read more: The Commons Economy and Accounted Revenue

The Commonwealth national accounts are unusual in that firms always finish the year at zero and residents always finish it in debt. This is the outcome of domestic moneylessness, in which residents collect their goods and services from a store or clinic without paying, an economic arrangement that ultimately incurs a debt to provision. This is because the individual value of a person’s labour is ultimately diminished without the multiplicative nature of the firm, which in the Commonwealth is where most state revenues come from.

In this system, firms are unable to accumulate money because it depreciates in value, and the surplus that is not reinvested is collected by the state. This ultimately settles the accumulated import debt of the domestic market, and the rest is lent abroad. This is state of affairs defies conventional economics, which typically looks for household savings and standing debt, but there is no such metric here.¹

The accounts are kept by the Bureau of Statistics with the Institute for Economics Research at the Treasury, and are denominated in the crown (✦), which is the universal unit of account used by every firm in the Commonwealth.

The Commons #

In abstract, the commons comprises every resident of the country. What they contribute is valued at the shadow wage, which is an imputed figure of labour hours multiplied by a skill factor, and which is never paid. In 2063, the shadow bill is ✦560 billion, or 56 per cent of output, against ✦650 billion of goods and services distributed. Goods and services here, which amount to the furnishing of a modest and modern life, are afforded to every resident of any age, and so the commons finishes the year ✦90 billion in debt. The state advances the difference and records it as the commons debt.

Firm is the legal term for enterprise with private revenues in the Commonwealth, which comprise bureaus, municipal industry and private industry. They earn accounted revenue on what they contribute to the domestic economy and on what they sell abroad, and pay levies described below. They also have their uninvested money collected, which effectively settles their accounts and leaves firms without discrete money.

The financial apparatuses of the state include the Commonwealth Treasury, the Commonwealth Bank and the sovereign fund. The foreign sector includes everyone else, including the holders of Blue Bonds.

The levies #

Main article: Fiscal Architecture

Firms owe the state obligations, which are arranged as five levies.

1. Commodities royalties (55 per cent of receipts of raw commodities, including hydrocarbons)
2. Export levies (10 per cent federal contribution, 5 per cent permit fee)
3. Ground rent, adjusted as the Public claim diminishes (see property and titles)
4. The state sweep of accounted surplus
5. Foreign payments and remittances

Because the sweep does not have a fixed rate and is not a requisition of product, and money depreciates, no firm is able to accumulate surplus. In 2063, the sweep was ✦129 billion, or about 40 per cent of the surplus, which comprises the 25 per cent for federal redistribution and the 15 per cent for reserve accumulation in an ordinary year.

2063 Transactions (✦ billion)

The table depicts is the commons debt at ✦90 billion, and the net position of the state ✦150 billion, which then subsidises the debt. The remaining ✦60 billion is effectively redirected into foreign assets because it cannot be reinvested domestically. In fact, handshake accounting is really a matter of structural circumstance, because the state is effectively compelled to lend overseas to resolve its surplus.

As such, firms in 2063 invest ✦190 billion a year out of their own surplus, which is 19 per cent of output.² The state’s reserves and sovereign wealth are at ✦1,200 billion, which are enough for nearly five years of imports.

Exports #

The Commonwealth does well with hydrocarbons and similar commodities – oil and gas raised about ✦100 billion in 2063. Financial services accounted for another ✦60 billion. Advanced manufactured goods comprise most of the ✦140 billion remainder, alongside famous Atlantic luxuries (produce, liquors, tobacco) and professional services it supplies to the international market. Around 14 per cent of the remainder’s value is imported content, which is accounted for in the ✦250 billion of imports.

Other exports, 2063 (✦ billion)

Because of this structural arrangement, in which distribution has first claim on output and reserve accumulation is last, the system is well insulated from international markets. Shocks would have to be titanic (something like the destruction of a fifth of exports) to materially impact the commons economy, and even then the state would only have to start drawing on reserves or deficit.

Unaccounted Commerce #

The Commonwealth also facilitates a large and informal sector of barter and unaccounted (effectively, unpaid) work estimated to be 15 to 20 per cent of consumption, and is not accounted for in the above tables. Unincorporated Areas are also only represented through their exports and the support provided to them by the state. Foreign workers, who are a small conventional labour market within the broader moneyless economy, contribute about ✦14 billion in remittances.