Economy on the Ocean > Economy on Land, or How Seasteading Can Revolutionize the World
por Anen-o-me
Why are some nations richer than other nations?
No one knows for sure; there are competing theories. Certainly the factors that result in great wealth production are multi-dimensional, and exist at the intersection of geography, local natural resources, navigable waterways and accessible ports, local population size, and perhaps most importantly the culture of the people and the legal and economic policy in effect.
Of these, the last two seem to be the most important, but we cannot discount the former factors either.
Why did Europeans sail all the way around Africa, to trade with India, seldom stopping to trade along the way? Mainly because Africa’s Western coast has very few good ports, and the people there very little to trade.
Why did America and Britain leap ahead of the world economically early on? Both are seafaring nations, and the USA has more good ports than the rest of the world combined, once you count that some 50% of the interior of the US has navigable waterways all the way up the Mississippi and its numerous feed-streams. Trade in the US was cheap, easy, fast and gave Americans cheap access to world markets.
I suggest that any seasteading society on the sea automatically gains the economic advantage that the US had in terms of natural geography and ports–available anywhere in the world there’s access to the sea.
The entire ocean is itself one big navigable waterway, and the necessity of travel in a seasteading society will mean there’s always space between dwellings to sail on.
We know that world trade was revolutionized by the steam-engine and the resulting steamships, this is because the cost of shipping is much, much less than the cost of moving goods by land–shipping is as much as 1% the cost of ground-transportation still today. At one time, Americans made fantastic profits shipping ice from Michigan to India and the rest of the world’s hot climates–something as simple as ice was once big business merely because of easy access to the sea.
Living at sea on a seastead will mean you always have access to great ports and world markets, regardless of who you are, how wealthy you are, or where in the world you live. This should translate into fantastic wealth gains for everyone in the world as seasteading economies produce goods for the world market, but the biggest winners will be those living at sea in the seasteads themselves.
In my home town of San Pedro, California, home to one of the world’s largest ports, the Port of Los Angeles, where I worked as a teen, the dock-worker’s union recently had a contract dispute with the owners of the port. The dock worker’s responded with a work slow-down. While the negotiations were ongoing, everyone in the world was a loser. Dozens of container ships were left waiting at sea with goods to offload, at a cost of perhaps a million dollars a day.
Ultimately they settled this dispute, but the longshoreman are among the world’s most pampered employees, precisely because they can hold an entire economy hostage to their demands for more pay and more benefits. They can do this because of a monopoly on the flow of goods into society. They make every product we buy more expensive thereby.
A seasteading economy represents the integration of docks and markets, the whole society becomes a decentralized port, where goods can be on and offloaded, anywhere.
We may, in time, develop specialized ports of our own for our purposes, but they are unlikely to result in the kind of centralized structures that the Port of Los Angeles represents, and I sincerely doubt we will ever face a dock worker’s strike at sea that can paralyze an entire economy. How many millions will that save us?
Each container ship that enters the port of Los Angeles is charged $50,000 an hour with a minimum stay of 24 hours whether they stay that long or not. So just parking a container ship dockside costs $1 million, and on top of that the port charges another $2,000 per container, with the average number of containers offloaded being 3,500. So that’s another $7 million, $8 million total for the privilege of offloading a single container ship. And these are old numbers from back when I was working for the Port of Los Angeles.
Similarly, imagine the cost of building roads on land. There is an off-ramp to the nearby Vincent Thomas Bridge that has been under construction since 2014 and isn’t slated to finish construction until 2016(!). It is adding a single lane over about 1/4 mile and a small offramp. Total cost I’ll wager is probably $10 million.
There will never be a need to build offramps in a seastead. Instead we’ll build submarines and go under the city, under the water.
What happens if you need another lane for boats and gondolas in a seastead? You simply float the whole city apart just a little bit with some tugboats, maybe an hour later you’re done, total cost depends on size of the seastead, probably not much more than a few hundred dollars at best even for the largest seastead, considering how much total mass can be easily moved even by a single tugboat.
And all land-based cities are hampered by historical hysteresis. They were founded and laid out long before anyone knew just how big they would become, how many residents they’d end up with, etc. All this means major growing pains as a city laid for for say 100,000 residents becomes a city of millions of inhabitants, resulting in drastic overcrowding of freeways and population centers. The 405 freeway is the world’s busiest freeway for two reasons, because it was never designed to carry this much traffic, and because to fix it would both take forever and cost an insane amount of money, probably billions of dollars.
But if the 405 were a freeway in a seastead and got too busy, just a lane made of water between structures, adding more space to it would be very simple, just float the whole city out a bit and you’re done. Again, the ability of a seastead to literally reconfigure itself any time it needs to, cheaply, cannot be overstated in how important it will become and how many potential uses there are. It’s a clear advantage of marine cities over terrestrial cities.
Lastly real-estate on the sea–there is none. Space is a liquid commodity at sea–you are always moving, you can always take up more space on the sea, you’re virtually never space constrained.
The amount of deep water and available out there is… enormous is an understatement. If and when we figure out how to profit economically from living on deep water, there will be an explosion of activity, similar to the land-grabs of the 18th and 19th centuries, as people build floating structures to develop economically at sea. Will it cost anything to simply move to a new part of the sea and build? Not likely. It’s just free water out there. Take up as much open water as you like as long as you can afford to build the structures to put there. We’re a long, long way from having to conserve real-estate at sea.
Most people don’t seem to realize that the majority of the cost of a house is the land under the house, not the actual structure itself. If you buy a $150,000 house, it’s likely it only cost about $50k to build the structure and the rest is land value. On the sea there’s no land value to pay for, you just build a (floating)house. That puts that $100,000 back in your pocket, which can now be invested and consumed.
What all this boils down to is more money in the pocket of every person that lives in a seastead, and cheaper cost of living for everyone. More money means both a higher standard of living and more opportunity to invest, which means that a seasteading society should be investment rich, which will allow it to grow quickly and raise standards of living far beyond land-based societies.
Might we replace the American dream with the Seasteading dream?
The real reason that some societies are wealthier than others is that some societies, for various reasons, accumulate more productive capital than other societies. Productive capital makes individual people more economically productive, which means bigger wages and more wealth.
The two biggest influences on whether a society begins saving and investing are its culture and its policies, and the two influence each other.
In economics there is a concept called time preference. People who have been inured into a low time-preference culture tend to think and plan ahead, tend to invest, tend to become wealthy.
And people who have been inured into a high time-preference culture tend not to think ahead, tend not to invest, and tend to remain poor.
To the extent any society has rich and poor, this cultural factor is often a major difference between them. Attitudes towards money, investing, risk, etc., are often handed down from parents and are shaped slowly otherwise.
In the same way that any society has its rich and poor and those in-between, so too do individual cultures vary in the same way. Some cultures are inherently more low or high time preference compared to other cultures. One could look at the Scots (I am part Scottish by blood, btw) whom have a reputation for penny-pinching but also for saving and investing, and who tend to become wealthier than those from other societies on average, as a good example. Why are the Scots good with money? What historical event made them a culture that broadly respects saving and investing money? Why do they have such cool tartans? Who knows for sure.
Another factor: public policy intersects with culture. If you have a society that doesn’t respect property rights culturally then it won’t respect them legally either, and it can strongly discourage low time-preference behavior among its own people. What’s the point in saving money if your society doesn’t consider stealing a big deal and you could lose your savings at any time with no recourse? In such a culture it makes more sense to consume as soon as possible rather than save for the future and risk having your savings stolen.
Most of the third world doesn’t have access to good public policy options. Seasteading can fix this too. Since there are no existing legal jurisdictions on the water, seasteading is a new chance at building legal structures. A chance to compete with existing legal state jurisdictions and outperform them, if we can. A chance at trying new types of law, like decentralized law.
If we can outperform existing states, and I think we have a very good chance to do so, then the third world will stream to seasteads for jobs and opportunity. And if we can encourage there a low time-preference culture and strong property rights, we can create the promise of strong economic development anywhere in the world.
As a result, we may see seasteading explode in time. I want to see a billion human beings living at sea within 50 years. If living and working at sea proves to have all the advantages we see in it now, then humanity is destined to leave its shores and venture onto the sea where there are no droughts, no fighting over fixed land, no constrained space, and a thousand other benefits that all together add up to one colossal boon to humanity.
Seasteading can revolutionize the world.
