San Francisco, 22nd Century
In the last few years, I’ve become a big fan of Star Trek: The Next Generation and Star Trek: Deep Space Nine. They’re wonderful shows, great science fiction that also not-so-subtly pushes liberal propaganda. Honestly, considering what a big fan of science fiction I am, I don’t really know how I avoided Star Trek as long as I did. But, I have finally embraced it, and because I’m me, I have now begun to overthink virtually every aspect of it. Specifically: I have a lot of questions about the economy of the Federation. We’re told that money is no longer used. Something called a “Federation Credit” exists, but it’s only used for foreign exchange. Philosophically, people are now said to focus on personal self-improvement, rather than the accumulation of material possessions. All well and good! But how does that work in practice?
In general, the economics of Star Trek can be described as “socialistic”, in that the Federation clearly has moved past any form of capitalism. This is very apparent whenever the show deals with the Ferengi, a species who’s entire society and government is built around hyper-capitalist competition. In The Next Generation episode where they are introduced, characters explicitly comment on how the Ferengi have yet to evolve their civilization to a more enlightened level. In another episode of The Next Generation, Captain Picard meets a human businessmen from the 21st Century who’s been cryo-frozen until now, and responds to his demands to access his bank accounts and stocks by contemptuously explaining that none of these exist anymore, and that humanity no longer considers his values to be important. But while the various Star Trek shows are very good at showing what the Federation’s economy is not, they are much more vague about explaining what it is. To understand, we have to engage in a great deal of speculation.
We can assume that some basic goods, such as food, are simply provided free of cost by the government to all citizens. The existence of matter replicators make this a negligible cost. But what about more cost-intensive goods, such as housing? Given Star Trek levels of technology, it would trivially easy to construct the buildings themselves, but how is it determined who gets what land? Land is always going to be a limited resource. There’s a reference at one point to “transporter credits”, implying a rationing system for energy-intensive goods. Private property as a concept still clearly exists, at least for personal items. Characters own clothing, knickknacks, various forms of personal entertainment. In Deep Space Nine, Joseph Sisko is shown running a restaurant in New Orleans, which shows that some form of private business still exists. But if he doesn’t charge his customers, where and how does he procure his fresh ingredients? That’s another commodity that will always be “scarce”. Federation citizens are seen patronizing foreign-owned businesses on Deep Space 9. How do they pay? With Federation Credits? How do they get or earn these? Perhaps most importantly, how does the Federation Council raise revenue? Obviously it doesn’t collect taxes, money no longer existing, but it must procure raw materials somehow! The central government of the United Federation of Planets builds and operates starships, industrial replicators, mass transit systems, space stations, and dozens of other forms of infrastructure. Whether or not it has a “budget” as we would understand it, it certainly must have some system for acquiring resources.
I propose that the United Federation of Planets has a post-scarcity socialist command economy. Essentially all heavy industry, mineral extraction and refining facilities, energy production, trade ships, and infrastructure is directly owned and operated by the central government. When resources are needed for a starship or a energy grid or a starbase or any other government project, they are directly supplied from existing stockpiles. The great weakness of the command economy has always been the inability of bureaucrats to properly anticipate consumer or industrial demands, leading to perennial shortages or gluts of goods. But the existence of matter replicators renders this irrelevant. In Star Trek, this technology is shown almost entirely in the context of food replicators, but it’s been clearly established to exist more broadly. In Deep Space Nine, the Federation is mentioned as having supplied industrial replicators to Bajor and the Cardassian Union, and during the Dominion War, there is mention of the station replicating replacement parts for damaged starships. So long as sufficient raw materials and chemical feedstocks are being supplied, the Federation has the ability to create as much of any given commodity is necessary “on the fly”, as demand warrants, instead of trying to set quotas or estimate needs in advance.
Technological advances also help answer another question, which is what would incentivize people to work in a system in which everything of need is supplied free of charge? Given the level of automation seen in the Federation, there are fewer “essential” jobs than one might expect, and I think even the menial ones would be higher status than one might realize. The Federation needs people to work in mineral extraction, for example, but I suspect that most people who work in that field are engineers and technicians, rather than poorly-paid miners crawling around underground. The same dynamic would hold true in construction, energy production, and most other fields. The Federation’s philosophy is built around “self-improvement and self-enrichment”, and I do think that even in the absence of capitalistic imperatives, most people would want to do something. For some, that would be cooking or making art or singing. For some, it would be engineering and scientific development. All that said, I do suspect that there are some incentives for joining Starfleet or working for the Federation. Whether it’s simply higher social status or improved access to scarce goods, I don’t know.
There is some irony, in that the macro-level economics of the United Federation of Planets are almost never addressed in the show, and yet I think they present a much less thorny problem than some of the micro-economics of personal interactions. This is because, once you assume that the Federation has nationalized all industry, it becomes very easy to envision a workable version of a democratic socialist system, in which most resources and production are operated by the government on behalf of society. For obvious reasons, I don’t think any Star Trek show will ever admit this, but I maintain it’s the only reasonable explanation. However, due to the nature of any television program, we spend a lot more time dealing with the economy as it relates to individual characters and their personal lives. The non-existence of money in the Federation is one of the few ironclad pronouncements made on economic matters, and yet it quickly becomes clear that the reality is more complex.
As mentioned above, basic goods such as clothing, food, and medical care are clearly supplied freely by the government. Questions arise when it comes to “luxury goods”, however, or energy-intensive commodities. Use of transporters, for example, is very energy-intensive, and it is implied, limited in some way. Captain Benjamin Sisko, in Deep Space Nine, mentions using up a “month’s worth of transporter credits in a week” back when he was in the Academy. We can learn from this that non-essential usage of the transporter is limited, but not that tightly limited. Presumably, civilians have a set number of yearly or monthly “credits” that they can use as they wish. This sort of system can also be applied to other scarce commodities. There does not seem to be any real restrictions on usage of food replicators, and we see characters using them to create small personal items as times, such as candles. But I suspect that if wanted to replicate, say, a fusion reactor or a truck, one would have to fill out requests and forms, or acquire permission somehow.
Somebody had to build all this
I suspect that most housing and land is publicly owned, and that there’s some form of lottery or allocation system based on need for people’s access to it. The actual construction of housing units would be trivial for the Federation, but there’s always going to be more desirable locations and less desirable locations, and you can only fit a limited number of houses on the beach. One complication here is that near the end of Deep Space Nine, Benjamin Sisko purchases land on Bajor, intending to build a house, which shows that private land ownership still exists. Bajor, at this time, is not a member of the United Federation of Planets, but it is intending to join eventually, and Sisko is a Federation citizen. My suspicion is that it’s possible to acquire land in the Federation on what amounts to a permanent on long-term lease, after which constructing one’s dream home would not really require all that many resources. There are certainly some restrictions on this, especially on densely populated “core worlds” such as Earth or Vulcan. But given the Federation’s emphasis on individual autonomy and personal self-realization, I doubt there’s much objection to this sort of practice on colony worlds. Whether the land or house would become permanent property of your family, to be passed down in your will, or whether it would revert back to public ownership after a certain length of time, is another question, and one I don’t have the answer to.
The existence of Joseph Sisko’s restaurant shows that some private businesses do still exist within the Federation, from which we can extrapolate that a peripheral market for luxury goods still exists. I had been struggling to understand how this could work without any universal medium of economic exchange, but when discussing this with my friend Ray Burton, they were able to explain it in a way that made a lot of sense:
My guess is that there are probably plenty of informal mediums of economic exchange, basically IOUs of various sorts, but that they are a) not standardized, and b) not really important enough for the lack of standardization to become a problem. If you wanted to acquire art from an artist that you particularly like, your first move would probably be just to ask if they’d be willing to give it away – and the chances of the answer to that being ‘yes’ would be quite a bit higher than in our world, because they don’t need to sell it for their livelihood. My guess would be that most artists would gladly give away the majority of their works, provided that the person receiving them agreed to treat the work respectfully and maybe to promote the artist when the opportunity arose. For artists who are less generous or for specific works which artists would not want to give away as gifts, some explicit bartering would probably be the next step, eg. “I’ll give you my painting in exchange for one of your neat jewelry pieces” or “I’ll give you my painting in exchange for more of some of the difficult to obtain art materials I use for my art” or “I’ll give you my painting, but only if you prominently display it in your collector’s gallery”. And if that falls through, people resort to “Here’s one of my business’s chits – you may not want anything I’m offering right now, but if you ever do, this will remind me that I owe you a favor, and I’ll be happy to part with something I might not ordinarily. And if you find someone else who likes my stuff, you can use this to trade with them, and then send them my way to trade it in for whatever they’re looking for instead”. Which I guess is technically money, but for such limited circumstances and with such limited applications that I would totally not fault them for claiming that they don’t have money.
I think using the example of an artist is very useful here, because most craftspeople of any sort in the Federation are going to be closer in definition to “artist” than “entrepreneur”. It’s easy to forget, but given that all material needs are taken care of, people with jobs or businesses are almost certainly doing them out of love, rather than need. Joseph Sisko runs a restaurant not because he needs to work, but because he loves to cook. I had said earlier that we can assume that the Federation supplies everybody’s food needs without charge. On Deep Space 9, there’s a place called the “Replimat”, which appears to just be a suite of food replicators that station residents can use free of charge. My assumption had been that the Federation government maintained versions of this all over the place. But Ray reminded me that there was no reason to think that this was a totally parallel system to the “private” businesses like Sisko’s Restaurant:
Joseph Sisko’s restaurant is probably more like an upscale version of a canteen – He probably filled out the standard request form for “I’d like what would be an unusual amount of fresh produce for a single person, please” and listed his reason for the request as “I’d like to regularly cook food for a lot of people” and was immediately rubber stamped, much like 99% of requests for such variances. His restaurant has no prices, and he gets his fresh produce from a combination of government sources and independent farmers he happens to know who are happy to pass along the fruits of their labor because he’s a better cook than they are, and so they think it’s better to pass their stuff along to him and have him cook it for them and others than keep it and cook it themselves. Additionally, some restaurants no doubt actually primarily rely on replicators rather than fresh produce. There’s probably a traditionalist restaurant culture into organic produce and time-honored French cuisine, and there’s probably a different, more programmer-esque restaurant culture based around designing flavor-profiles and unique and pleasing textures for replicator food. They very likely don’t view what’s going on as the government subsidizing anything, so much as the governmental stewards of the resources they all collectively own distributing them in a sensible way. The government isn’t propping up Sisko’s restaurant – Sisko is just taking and using a reasonable amount of what’s rightfully anyone’s, and the government is making sure that he’s not requisitioning more than his fair share.
A contemporary socialist government would probably not be interested in subsidizing fancy restaurants in New Orleans’s French Quarter, but given the vast economies of scale created by matter replication technology, there’s not that much difference in cost between doing that and simply handing out food stamps.
For internal Federation transactions, most people probably use some form of barter. But in Deep Space Nine, Starfleet officers stationed on the station are often seen patronizing foreign-owned businesses such as Quark’s Bar and Garak’s tailoring shop. It is certain that these individuals expect some form of payment. The general medium of exchange on the station is Gold-Pressed Latinum, which seems to function as a sort of galactic reserve currency. It’s usage within the Federation, however, seems to be limited. The only Starfleet characters seen with it are ones who won it gambling at Quark’s. At one point when Jake Sisko wishes to purchase something, he is forced to borrow Latinum from a Ferengi friend of his. One a few occasions, Captain Sisko authorizes payment in Latinum, but this is in his capacity as a representative of Starfleet. Given the Federation’s involvement in interstellar trade with other powers, it seems likely that this Latinum was acquired over the years through various transactions and stockpiled for use in later trade. There is certainly some Latinum circulating within Federation territory, but it is doubtful that it has that much more value than any other interesting trade good that can be swapped or bartered later. Usually, when characters make purchases, they’re shown punching in a combination on an electronic pad. This brings us back to Federation Credits.
We’re told that Credits are the Federation currency, but that they’re only used in international exchange. Presumably, if the United Federation of Planets wished to purchase some resources from the Klingon Empire or the Ferengi Alliance, it would deposit some Federation Credits in return, Credits that could then later be exchanged for goods and services from the Federation later. This could include other raw materials, or something more complex, such as usage of industrial replicators, technological transfers, or access to replicator patterns. My theory is that Starfleet officers stationed outside the Federation, such as on Deep Space 9, have access to “expense accounts”, where they can charge basic expenditures to the Federation, which later repays the vendors in Credits. There would have to be some limits on how much you can spend, but it would explain things rather nicely.
In some ways, a lot of this speculation is very silly. Star Trek is a massive, sprawling media franchise that’s never cared too much for maintaining strict continuity or plausibility. For example, much of the vagueness surrounding what exactly a “Federation Credit” is comes from the fact that in The Original Series, much of what would eventually become cannon was still fluid, and the idea that the Federation was a post-scarcity utopia was still in it’s infancy, meaning that references to “credits” as a monetary unit were used freely. By the time of The Next Generation, Roddenberry had decided that the Federation no longer used money at all, and writers and producers had to adapt. I suspect that the entire existence of food replicators, and the post-scarcity economic system they imply, emerged as a form of narrative convenience. Much of what I find so fascinating about the society the shows created the writers hated; Ira Steven Behr grumbled that “A society that uses replicators is a doomed, finished society.” and Ronald D. Moore complained of the prohibition on a Federation currency that “I’ve always felt this was a bunch of hooey”. And yet, despite all this, there’s something profoundly radical about a multi-million dollar media franchise daring to explicitly state that capitalism is an infantile phase of human development, and someday we’ll rise above it to unlock our true potential.
Star Trek is about socialism, whether it knows it or not, whether it admits it or not, and figuring out the details of how it all works is, for me at least, a whole lot of fun.
Food replicator on the USS Enterprise
Goldwag's Journal on Civilization 