Thomas the Book Engine

I’ve written three book proposals in the last six years.

The first one failed after an agonising process. The second one failed far more completely and spectacularly. The third one though?

The third one just turned into this…

Screen Shot 2018-04-16 at 11.34.30 AM

And I’m suddenly on giant roller-coaster of anxiety and excitement… !!

  • Seventy-thousand words to write by the end of the year. (Actually probably more to allow for editing down. Eek!)
  • Topic: incentives. (Suggestions for chapters gladly accepted…)
  • Goal: write something I’m proud of.
  • Sub-goal: write something lots of people want to buy!

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Thomas the Think Engine is the blog of a trained economist. It comes to you from Melbourne Australia.

31 thoughts on “Thomas the Book Engine”

    1. Ha! You’re right no doubt. I anticipate a lot of tormented weekends spent at the computer as the year goes on…


  1. Congratulations Jason/ Thomas

    I really enjoy your thoughttful posts, so I’m sure the book with be great. No pressure :)


    Sophie Wallis


    1. Hi Heather! I’ve just learned about the BX conference and I’m going to try to see if I can attend as media. Perhaps we can chat there!


  2. Sounds intriguing, following the incentive trail: they drive everything! The unexpected incentives might be worth exploring: what employers, purchasers and governments unwittingly create incentives for by their actual behaviour (and not their espousal).

    Liked by 1 person

  3. I’d be interested in the economics behind twitch streaming. Twitch is where people live streaming a past time to an audience. The past time is usually gaming, however, people play music, draw, write code, knit. was bought by Amazon last year and people are making a living from it. Recently an ABC presenter and personality quit his job to be a full time twitch streamer. There are also professors of music taking donations to play songs on stream. The base revenue is a subscription model where the subscriber pays $5 a month, with a 50/50 split between streamer and the platform.

    However the majority of revenue is from people donating money and they have a message read out on the stream via a text to voice synthesised voice. I see this as an “attention based economy” where the person who paid gets the attention of the streamer and the people in the chat.

    To see examples of twitch I would suggest and as a starting point.

    The interesting part is that it harks back to the day of patronage in the arts and science in Florentine society. Galileo benefitted from the patronage of both the Marchese del Monte and the Grand Duke of Tuscany, Cosimo II de Medici. What is old is new again, instead of being a couple of rich old dudes, it’s the coins of the masses through the internet.

    Most streamers raise money for charity. Some have ability to raise $2k in 30 minutes.

    Liked by 1 person

    1. Thanks Joe
      I’ve heard a lot about Twitch. Have not checked it out yet but the longer that goes the more I feel like a luddite so I will soon!


  4. I remember reading Paul Ormerod in high school and struggling to understand his metaphors. Please don’t be like Paul. Clive Hamilton was cool for a while, until it felt like he felt the need to be drier in his writing. I’ve been reading your work for a while on the down-low, between the blog and your news articles. I’m so excited for a book, because your articles always leave me wanting more. Economics is so interesting, a beautiful jumble of people and politics and psychology and history and silliness. I hope when you write your book you tell a story about the beautiful chaos that is Economics. I look forward to when it comes out.

    Liked by 1 person

      1. The reason I asked is because in 1998 my parents won the lotto (in Tasmania), becoming instantly wealthy and able to leave their jobs, only to end up bankrupt and heavily in debt 4 years later. They then split up (for 6 years). This was so hard to watch I began to research on it and discovered that statistically, somewhere between 70-95% of lottery winners end up the same way my parents did, and I have subsequently met past lottery winners in the flesh, all of whom lost it all and more.

        But the real shock came later when I discovered that 19 out of 20 businesses ultimately fail, and around the same percentage of people will retire with insufficient funds (when I last checked around 6 months ago, according to ABS, total superannuation in Australia is something around 3.7 trillion where total household debt is around 3.5 trillion).

        So in 2002 began a long journey of truth (for lack of a better word) and the search to answer a lot of questions. I wanted to know why these statistics existed, why the majority of people were not succeeding when it comes to money, why those who win large amounts can’t hold on to it let alone make it make more money, etc; and these questions flowed into other questions like, is it because we are all quite lazy, and lacking discipline and intelligence, or is it more a mathematical certainty, in other words, is it impossible for everyone to be solvent, let alone generating returns on a constant basis; could everyone retire young? What is it people really want, is it money, or is it really something else like security or trust they seek? Why is it so many people are in debt? Is debt necessary to our economic way of life? Why do so many people dislike their jobs, why do so many people play lottery, why are there so many poor people in so-called rich countries. I then wanted to know if I really wanted to be one of the success stories or not? If I found out that it is not because people are lazy or lacking intelligence, but that it is a mathematical certainty that for every retired wealthy person, others must be in debt and working meaningless jobs, can I live with myself if I was wealthy?

        All other sorts of other questions began to surface such as, if we created a Utopian world where everyone was successful, healthy, and stress-free, what would all the police, judges, doctors, nurses, economists, politicians, lawyers, government workers, not to mention all the industries which exist a result of wars, conflicts, diseases, etc, do for a living? What would all those volunteers and charity workers do? Where would it leave us all, what would we all be doing when we consider how many jobs and careers exist because of the fact that we are living stressed and conflicting lives in a stressed and conflicting world?

        So began a long journey of research and study into just about every subject you could imagine. I studied money, finance, banking, markets, economics, law, history, religion, philosophy and whatever else I could get my hands on, including studying wealthy people, middle class, and poor people (my brother lived many years on the streets) and through this process also began to learn how to objectively (at least try to) study myself as an economic agent living in a competitive world and the many decisions I make or have to make as a economic agent.

        Unfortunately, what these studies (both the material and of myself) revealed was not good, both as to the prospect of seeing a happy world, and on a more personal level, as to my own ability to find any peace.

        I discovered that no amount of wealth can exist without others being in debt because money itself is debt, that economies can’t grow without conflict and suffering on all levels, and that crime, homelessness, unemployment, and poverty (which I refer to as the CHUP sector) not only can’t be reduced to zero, no one really seems to want them reduced to zero. A mate of mine went into a job network place to find that they had started implementing computers, and he jokingly said to a lady there, I bet you hope these don’t replace you, and where she replied, I hope not or I will be out of a job. This made me think about the sheer size of the jobs which exist just because there is unemployment (centrelink, dept human services, job networks, charities, counselors, education providers etc) and I realized that the extent to which the economy relies on jobs, careers and industries which exist based on the CHUP sector alone, not to mention the many other industries which thrive financially from diseases, wars, etc is too large for them to ever be reduced to zero.

        This also led me to discover one of the biggest contradictions of our politically and economically motivated society, that homeless people are physically unable to obey all laws of society by virtue of being homeless, such as laws against vagrancy, loitering, public nuisance etc, and lacking access to basic needs like food which causes them to beg or dumpster dive etc, all of which is illegal – something my brother experienced a lot (interestingly, my brother told me once that when he was homeless he used to busk and he said it was the richest he ever felt because he had no bills; he sometimes gave money to other homeless because he didn’t need it and it was safer to get rid of it than to be a target). This meant that unless one is willing to compete to become an economic agent, or failing this, to seek welfare subject to the terms society creates, then society will prevent you from obeying the laws of society.

        The most painful discovery however for me personally, was that I don’t even like being an economic agent to begin with, because whilst I love to work with my hands and produce, create, invent etc, I do not like competing in the market place, I do not like selling, I do not like exchanging, I do not like being in debt, I do not like holding others in my debt, I do not like being bound by contractual agreements, I do not like being bound to the same daily routines (such as is required by a job), I do not like working with or around others who also do not enjoy their jobs, I do not like pursuing money, I do not like having to budget, I do not like living in fear of what the economy might do and my prospects of providing for my children, I have no desire to own property, nor do I share the same political and economic goals of the majority of my fellow country-men, and yet, all of these things I must do otherwise I will become like my brother or worse, I will no longer be providing for my children, which in itself is illegal. It’s like discovering I am an alcoholic, but unable to do anything about it because society expects me to continue being one because it is the only thing which fits with their goals and the political goals of the country.

        So I set out to try to answer the following questions:

        1. How can we reduce the CHUP sector without it costing tax-payers and property owners a single cent, without the need for welfare and charities, and whilst at the same time not leaving those whose jobs rely on the CHUP sector without a job?

        2. How can people like me, who do not enjoy the game of economic pursuits, and others who lack the emotional (like my brother and others who can’t hold down jobs), the intellectual (disabled etc) and the physical (injured etc) disciplines to be an economic agent let alone hold down a job, produce something and contribute to society in a way which does not require us to be economic agents who must sell and compete?

        By attempting to answer one question, I was finding that I could answer the other, and that the solution I came up with solved both problems. This solution I call the Custodian model. I was so shocked when I discovered this by the simplicity of it, that I spent years trying to disprove it, only to find that the more I tried to disprove it, the more it was proving itself, that there is a way to reduce the CHUP sector without causing economic loss to anyone, and at the same time providing an alternative to the game of economic pursuit for those who wish to operate another way.

        Unfortunately, no one seems interested. Every economist I try to show it to, especially those who claim to be motivated to help reduce the CHUP sector, aren’t interested. I have share this with countless blogs which are based on economics and all I find is that everyone is charged with their own political view and nothing else matters. I have shown this to the Australian government, at the RBA, the Treasury, and to the Cabinet, and not a single response. I have written to politicians about it who don’t respond.

        I wish I had never discovered all of this, I wish my parents had never won that money to begin with, because then I would have been blissfully unaware of the reality of the economic world and of my own emotions etc. I constantly scream to the heavens asking ‘Why the hell have you shown me this – what am I supposed to be doing with this knowledge??????’.

        So anyway, I have often wondered if I should write a book about it, but then I ask myself, who on earth would read it? Why would anyone want to read something that doesn’t have a happy ending? Of course, on the flip side, having this knowledge means I am more aware of why and when economic cycles turn down based purely on understanding the nature of money and human emotion, but I know that only those who care little about the CHUP sector are going to be interested in such a book and my conscience won’t let me do that.

        Liked by 1 person

  5. Dingo – I read your comment and found it fascinating and beautifully written! The problems you’ve identified are mostly good. But your solution seems to me unworkable.

    I read your blog about the custodian model. I have to admit I don’t see how it can work.

    Here’s my rebuttal. Let me know if I’m missing the point.

    Basically you have for example government-owned farms and people living on them, custodians, who share their surplus with the government? I fear the incentives are such that the farmers will make enough for themselves and there will be no surplus for the government. Given the government is furnishing the land and the tools of the trade this is a bad deal for taxpayers!

    There exist already parts of the economy with the land and capital goods provided by government, that provide a service the government finds useful. Let’s think about hospitals and imagine the doctors nurses and adminstrators are custodians. The implication of your model is that as well as working for the government the staff live in publicly provided housing and get paid a subsistence wage? It’s certainly possible some of them would prefer this to the current model but I’m unsure how many.

    It sounds like a work-for-the-dole scheme blown up to economy-size (or a bit like the military!)

    Ultimately I think the problem with your custodian model is that it assumes patterns of productivity can be sustained absent strong incentives. I suspect the custodian sector has underdeveloped incentives and would rapidly become unproductive.

    In your comment above you said a lot of things that resonated with me:

    >I do not like being in debt, I do not like holding others in my debt, I do not like being bound by contractual agreements, I do not like being bound to the same daily routines (such as is required by a job), I do not like working with or around others who also do not enjoy their jobs, I do not like pursuing money, I do not like having to budget, I do not like living in fear of what the economy might do and my prospects of providing for my children.

    I feel much the same. And I think most people feel the same.

    Few of us really want to be economic agents I reckon. A tiny share of people thrive on it and then a big share grin and make do, pretending they like it since they have no alternative. But few of us want to give our lives to the great capitalistic machine – just like bears probably don’t want to stand in freezing streams chasing slippery fish.

    It’s important to remember that in a state of nature we are also driven by incentives. Hunger and thirst and feelings of danger are powerful motivators. If these strong and concrete motivators feel more real, you can always drop out and become self-sufficient.

    The tricky part is dropping out while also being part of the economy. Your custodian model tries to achieve that but I think where you go wrong is not thinking enough about how productive a sector unguided by incentives would be. It is hard for me to believe the custodian sector ends up being a net contributor to everyone else.

    This is my thinking at this early stage of getting to grips with what you’ve suggested.


    1. Hi ,
      First of all, thanks for the kind words regarding my writing. I have always felt that I was poor at writing and explaining myself so this was a bit of a surprise.

      Also, thank you for your thoughts on the custodian model, it is very constructive.

      I got the idea of the model after having an email conversation with an economist from Iran, after I had done some searching on the historical roots of usury and the problem religions have always had with it.

      He explained to me that usury ultimately occurs and is perpetuated by pre-determining profit rates and insuring against loss. He used the humble tomato seed to explain.

      Two households grow tomatoes to eat and one household has his current tomatoes, his current crop and all his seeds (capital) destroyed by some freak act of nature. He asks his neighbour for some tomatoes to eat for his family, and some seeds to grow a new crop. If the neighbour lends tomatoes with the condition he must return an equal or larger amount of tomatoes he has committed usury. If he lends the tomato seeds with a pre-determined interest rate and/or he places a lien on any of his neighbours property as insurance, he has also committed usury. To not commit usury, he must gift the tomatoes out of compassion asking nothing in return (but knowing that his neighbour would do the same thing for him), and he must lend the seeds under a profit share arrangement, whereby, if the crop succeeds they both share in the surplus, if the crop fails both get nothing. It therefore becomes incumbent on the lender to work with his borrower and to ensure success. This contrasts with the capitalist or the Wests view of lending whereby the lender pre-determines the interest rate and insures against loss by placing a lien on the borrowers property, and then has no more to do with his borrower leaving the success of the borrower purely up to the borrower.

      I had already spent years studying trust law and its history through both the English and Roman empires and found the principles upon which the honoury trust operated (compared to the now more common commercial trusts of today) to be beautiful. I then married with this what I had learned thanks to my Iranian friend and the Custodian model sprang out at me.

      So as for incentives, or lack thereof as you mentioned, both the fact that government will be working with the custodian to ensure success, and because the custodian is operating under trust law, then I cannot see the custodian being unproductive.

      However, the definition of productive (and indeed success) may need some careful scrutiny. How productive do we really need to be? According to statistics from the ABS, workers in Australia on average produces 5 times in GDP what a person on the dole consumes. This tells me that we already produce, and/or are capable of producing far more than is necessary. But having said this, a worker who does produce as much as they do puts himself in a great position to accumulate much in wealth, and so their level of production is in many cases spurred on by the potential financial rewards it may bring him. Contrast this to a custodian who has no goal of owning property, then on what grounds should they produce the same level as a worker in the private sector?

      I recently read a blog post by Bill Mitchell of MMT who was criticizing something called the universal basic income (something which I do NOT support) and the theme of his blog was based on some members of society who just wanted to do their art and receive a UBI. His complaint to this was that these people shouldn’t be allowed to just do their art when there are those out there working 40 hours a week and who produce the houses, food, energy etc which the artists too will consume.

      But missing in this argument from Bill and just about everyone else who makes this or similar arguments (such as those labelled at the unemployed), is the fact that these workers are not restricted to just producing the houses, food, energy they produce, and many of these workers may even own the means of production. These workers have the ability and the legal right, thanks to a society based on free-enterprise, to generate much wealth from their work and many do. Take a wheat farmer who owns his farm – if the farm appreciates in value based purely on market forces (a bull market in wheat or asset speculation etc), is the farmer not going to take advantage of his new found wealth, for which in reality he did nothing to create? Does a home owner not take advantage when he finds out his home has appreciated 20% in two years through nothing of his own doing? Would a worker who allocates 30% of his wages to investing in the stock market going to complain when the value of his stocks appreciate thanks to a bull market?

      So, my point would be that, yes, some people choose to grow wheat, produce cars, work in factories, drive trucks, etc but for many of these people, the incentive is less about the thing they are producing and more about the financial rewards it can bring, as many of these earners can take some of the money earned and accumulate financial wealth with it, which if they are good at, or lucky, can eventually retire and live off passive income.

      Contrast this with a custodian, who has no economic or financial goals, then how much production do we think is enough? More importantly, is it even that important what they produce? For instance, what if a custodian was simply an artist, spent all their time creating art, but made this art available free for the public to enjoy. Would not the community benefit from free art?

      I must also point out that the custodian model is not operated on behalf of the tax-payers in the sense that if a custodian happens to be growing food, such as wheat, and creates a surplus, that this surplus is just then gifted to tax-payers or sold on the open market and the proceeds dished out to everyone. In fact, the operation of the custodian and any surpluses generated are not to be co-mingled with the private sector in a commercial sense but must be kept to distributing to other custodians or to the volunteer sector. The reason for this is because it would be unfair on the private sector and all the commercial farms who are growing wheat if custodians who had a bumper crop then dumped all that wheat on to the open market thereby causing the price of wheat to fall. This would not be something commercial farmers would want.

      But, the custodians do benefit the private sector (tax-payers) other ways;

      One, is that all tools and necessities which are required to be purchased by the government on behalf of the custodian model (things they are unable or have yet to create themselves) will be kept local because the way they are purchased (by non-market sourced money which I explain on my blog) means cost is not a factor, hence there is no need to find cheaper imports, and this benefits local businesses.

      Two, because the custodians do not pursue money, do not receive tax-payer money, do not pursue property, do not pursue jobs, etc, then they are not competing against everyone else in the private sector for money, property, yield, jobs etc, and hence do not contribute to market swings, asset inflation, business cycles etc.

      It is because the custodian model does not compete against the private sector (i.e. tax-payers/property owners), that it benefits the private sector.

      I use an example of the man wanting to paint his house yellow, as a means to explain this better. Imagine a street full of white houses, and one home owner decides he wants to paint his house yellow. All other home owners believe that if he did this, the value of their own homes will fall, so they strike a deal with him that if he agrees not to paint his house yellow, they will pay him a monthly sum. From a legal perspective, the law deems that he has passed consideration because he has given up legal rights. By this same reasoning, I am saying that the custodian, but giving up his legal right to pursue financial wealth, has passed consideration to the private sector, who are now better off because there is less competition for property.

      Another example would be the game of monopoly. If 10 people start out playing, then each has a 1 in 10 chance of winning. If 2 people drop out, but at the same time freeze two of the properties (a metaphor for the custodian model making resources unalienable), then each of the other players now has a 1 in 8 chance of winning, and the fact that two properties are no longer allowed to be competed over does not reduce the ability of any one of these 8 players to win the game.

      As for the numbers who would operate this way, I doubt many people would even want to operate the custodian model. The custodian model would I think only be operated by a small percentage of the population, which I believe would be in the vicinity of around the average unemployment rate. This is not to say that all unemployed (or homeless etc) would be custodians, on the contrary, many unemployed desperately want jobs and aspire to be part of the private sector, but there are many in jobs who don’t like their jobs, and don’t aspire to pursue the rewards which the economic system provides (like financial wealth, property ownership etc). A lot of these people have very creative and cultural skills which are never truly expressed because there is no demand for them in a commercial world, so in a sense the world never gets to see the best that these people have to offer, and unfortunately, these people really only exist solely for others and not for themselves.

      I must also say that one of the reasons I am so passionate about the custodian model is because I am in fact a staunch supporter of capitalism, even though I am the last person on earth who would ever succeed at capitalism. The reason I support it is because I believe it is capitalism which has produced some of the greatest achievements by man. However, what I do not like about capitalism is that it is forced on all of us and not all of us are equipped to operate under it, and all resources including human needs are subject to its principles. As a result of it monopolizing all of us and all resources, the costs of capitalism can then never be truly met. There is no Yang to the Ying. I don’t believe socialism or communism is the answer purely because these are political in nature. I also don’t believe the charity sector is the Yang to the Ying either because whilst the charity sector hold resources subject to trust principles and operate on behalf of community purposes, they operate under the same monetary circuit as the private sector making their survival completely reliant on the private sector. It is only the custodian model which I see can offset the costs of capitalism because it does not compete with it.

      In recent times I have started to wonder whether it would in fact be capitalists themselves who would support the custodian model more than anyone else, on account of the fact that they will see that the custodian would be the only model which does not compete against capitalists for a share of the pie that they create.

      I really do appreciate the fact that you took the time to read and make comments. I have learned a lot from this and realize that I have more to explain on my blog. If you have any other questions or suggestions please let me know.



  6. Hi Dingo.

    On a practical level I’d edit the post on the blog that is in capital letters. It looks shouty! Your writing is good enough that the flow of your ideas emphasises your key points with little need for capitals, italics, bold or underline.

    My response to your challenge would be that the government acquiring land and tools for the custodians seems costly. Where does the money for these acquisitions come from?

    If in your model the government can print some amount of money to buy things in the real economy, are there not higher priorities for that spending than permitting some people to become custodians?


    1. “My response to your challenge would be that the government acquiring land and tools for the custodians seems costly. Where does the money for these acquisitions come from?

      If in your model the government can print some amount of money to buy things in the real economy, are there not higher priorities for that spending than permitting some people to become custodians?”

      Hi Jason,

      I explain on my blog that the money is non-market sourced, i.e. issued by the Central Bank interest free, and then destroyed when it returns in the form of taxes, therefore it has no impact on the supply of money or on inflation etc. This contrasts with all other money which is market sourced, i.e. sourced from the economy itself.

      The key differences between market and non-market sourced money is the purpose for which they are created. When governments spend money into the economy, mostly it is aimed at helping grow the economy, and as the economy is market and competition based then it makes sense this money should be market sourced and charged at interest (i.e. a product of that very economy). The custodian program is not part of the economy or the markets and therefore it does not make sense to use money sourced from the economy, nor would it be fair on the participant of that economy to use their money for programs which are not for the economy itself.

      Therefore, to answer your second question, of course there are higher priorities, and if these were dealt with on a more consistent and permanent basis then people like me might have less reason to try and come up with ways to get people off the streets and into homes without having to beg to tax-payers to pay more attention to how much suffering is going on. (I have always maintained that distribution of income will never work to address inequality, and that the reason many people are poor is because they lack legal permanency in access to needs).

      Ultimately, this is why I set up my blog as the Economists Challenge. Whilst I welcome feedback, the point of explaining my custodian model to economists is not as much to hear their opinions as to whether they like it, or agree with it or not, but rather to simply answer the question, if one individual was to become a custodian, would it cause anyone else economic loss? If 1% of the population became custodians would it cause the other 99% economic loss? If yes, then how?

      If not, then there can be no grounds upon which anyone could argue against the program itself or anyone implementing the custodian model. This then means, if the custodian model, and the way it functions and is funded as per the way I explain in my blog, does not cause anyone economic loss, then the same process of funding could be used for other, higher priorities, if these priorities were not for economic purposes of course – we must keep economic purposes and non-economic purposes separate.

      To date, I have not had anyone actually take up the challenge and explain how the model would cause others economic loss, but this could also be because either my blog is too long, or is not explaining it properly. Some of your questions suggest that maybe I have not explained well enough how the custodian model is funded.

      “On a practical level I’d edit the post on the blog that is in capital letters. It looks shouty! Your writing is good enough that the flow of your ideas emphasises your key points with little need for capitals, italics, bold or underline.”

      Thank you, I will address this



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