Technology for Price Administration (TPA)

Transparent and fair digital governance of the productive-distributive model

 

 

Introduction

 

This proposal presents a digital system for the administration of prices, which restricts the spaces for speculation. It allows the State to have the ability to manage the dynamics of the market, in favor of the entire society.

Current technological developments make it possible to record the supply and value chains of the production and distribution processes, facilitating transparency in cost structures, prices and movements of goods.

For this, an articulation of the use of 1) The Central Bank Digital Currency (CBDC) is proposed together with 2) A universal, single and centralized digital accounting system (CDAS) and 3) The digital fiscal invoice (DFI), to achieve a system for the social administration of prices, among other objectives.

Digitization facilitates the automation of the transparent management of money as 1) a unit of account and as 2) a system for measuring and distributing values; eliminating the distortion associated with the practice of treating money as a commodity within the market.

A universal, single and centralized digital accounting system, built with the chained and cumulative use of the digital fiscal invoice, would serve to obtain precise data on the dynamics of production and distribution and cost structures. Such a system would allow negotiations to determine fair and non-speculative prices. In addition, it allows to permanently monitoring the total stock of national inventories.

The establishment of this system requires overcoming important barriers, from economic and political interests, considering new investments, to socio-cultural factors, among others.

The reason behind the proposal is both to get the State to advance in the use of technology to promote inclusive collective development, and to consolidate a comprehensive social justice system.

 

This document is structured in six sections as follows:

I. Description of the problem, taking into account, on the one hand, the "Flexibility and dynamism of the system" and, on the other, the "Technology Advances Facilitate Transparent Pricing Administration";

II. Structure of the proposal, composed of three parts: a) Central Bank Digital Currency (CBDC), b) A universal, single and centralized digital accounting system and, c) Digital fiscal invoice (DFI) and inventory control;

III. Objectives of digital governance;

IV. Factors adverse to the proposal;

V. When Technology Administer Prices; and

VI. Summary of the structure of the proposal.

 

 

I. Description of the problem

 

1.       Uncertainties are favorable conditions for speculation and speculation generates more uncertainties. Instead, transparency and measurement are instruments for managing fluctuations and for further stabilizing the economic system.

 

2.       The coexistence of free pricing for most of the economic activities, with other regulated prices, such as wages; perpetuates the widening of the social gap and the conflicts it generates. It also preserves the existence of a model in which the might corrupts the right.

 

3.       It is understood that, by means of prices - as an instrument for the indexing of the distribution of social wealth -; it is that the different levels of powers are defined and consolidated, corrected or balanced, for the development of a certain socioeconomic model.

 

4.       Today, many other countries like Venezuela, Argentine, Lebanon, Syria… feel first-hand the lethal power of the logic and the dynamics of free prices, associated with the dynamics of 1) the market and 2) the flexible nature of money which is divorced from the real economy, to become autonomous, anonymous, decentralized and converted into a “variable unit of account” and an unstable reference of value. Consequently, in the case of Venezuela, the social achievements of the Bolivarian political process have been diluted, and blows have been inflicted against the national productive-distributive system, against confidence in the country's institutional capacity and even against the ethical and moral system.

 

5.       A mechanism to dampen fluctuations within a collective system, such as price administration in the economic system, should NOT be administered at the discretion of individuals -identified as the market- according to their particular interests, but must be administered within a participatory and democratic system.

 

6.       Market dynamics should NOT be subject only to the requirements and pressures which could exert the economically powerful elites on supply and demand, but to the aggregate of supplies and demands of the whole of society.

 

7.       The State is an important economic agent with socio-political responsibilities, which cannot remain neutral to preserve the status-quo of private capital and perpetuate the dynamics of exclusion associated with the free market.

 

 

a. System flexibility and dynamism

1.       The system that we propose does not pretend to impose a straitjacket on the real variables of the economy; but its purpose is to control speculative dynamics, stop socio-economic and political destabilization and stop the attack against national economic sovereignty. It seeks to create conditions of transparency and stability to facilitate production processes and protect the value of the purchasing power of the workforce, consumers and service users.

 

2.       The price stability is relative; it depends on internal and external macro variables. In this sense, this proposal provides that the system has the flexibility to adjust in real time and not to block production processes with delays. When it is required to adjust and change a variable, at the structural level, the system has the possibility of executing it at the necessary moment. Thus, all cost structures, based on supply and value chains, are adjusted automatically and thus also the allowed price ranges are adjusted.

 

b. Technology Advances Facilitate Transparent Pricing Administration

1.       The technological developments of the last half century offer us the opportunity to rethink the usefulness of the use of centralized planning, with a high probability of success in achieving supply and price stability; provided there is a will in the political power to establish a transparent, efficient and comprehensive system.

 

2.       Probably, the actual social, economic and political conditions given in the case Venezuela, favor the State to consider the opportunity to establish a centralized digital system of transparent administration of costs, prices and merchandise mobilization. This could allow the nation to move from speculation and corruption to the transparency and stability necessary for the construction of a stable and inclusive economic model.

 

 

II. Structure of the Proposal

 

Digital LINK of Prices to Merchandises, through programmable CBDC

 

1.       The proposal assumes a central role for the planning, regulating and controlling State, which is responsible for establishing, managing and controlling the operation of the proposed system.

 

2.       The system tends to be largely digital, reducing interference and the possibility of corruption, be it public or private. It is based on and requires the latest developments in the digital areas, the management of big data and telecommunications.

 

3.       The system is organized into two subsystems

a.       Central bank digital currency (CBDC)

b.      Universal, single and centralized digital accounting system (CDAS)

 

4.       Both subsystems are linked by the digital fiscal invoice that will record the socio-economic exchanges to build the necessary database for 1) the construction of productive chains, 2) cost structures and 3) merchandise mobilization.

 

5.       These subsystems should be complementary and integrated among them, so that the objective of stabilizing supplies and prices is achieved.

 

 

a. Subsystem 1 – Central bank digital currency (CBDC)

 

The paradoxical and obsolete technology: The bearer-token money technology, is a decentralized disarticulated accounting system

1.       How is it possible to have price stability when the basic unit of account that is used as a metric for social exchange is considered in itself as a negotiable asset, like any other commodity that the market can bet on and thus change its value?

 

2.       In the current interpretation of money, there is a paradox that arises from a contradictory duality in its conceptualization and definition. Money supposedly should fulfills the function of a unit of account which should be stable to serve as a standard for the measurement and distribution of values in the real economy; but at the same time, the logic and practice of the market interact with it as if it were a negotiable asset -as a scarce "medium of exchange and / or store of value” -, so anybody can bet on it, altering its value, according to the supply and demand of the capital market needs. This dynamic creates the absurd paradox of the supposedly stable but in the actuality a varying unit of account. It is the market's formula to convert the social measurement standard into an instrument for speculation and an index of volatility and instability.

 

3.       Probably this paradox or cognitive bias is a conceptual inheritance resulting from our fixation on the technology of ​​money as necessarily being a medium of exchange and / or store of value, and failing to perceive the historical evolution of money as a social accounting technology for measurement and distribution. Money as a social technological development does not have to be represented by any physical means; instead it can be adapted to other technological expressions, including the abstract and virtual of digital technology. In the end, money is an accounting system and as such it is abstract.

 

4.       To overcome this bias, it requires freeing ourselves from the fixation that money itself is necessarily a medium of exchange and / or store of value, a concept that has probably been accepted and preserved while the technology of money as bearer-token lasted, based on some scarce material of value - from the primitive icons, going through gold and even including today's different bearer-token forms; or probably because the more recent conceptualization of money as credit, which lead to the believe in the absolute need for institutional intermediation of the banking system, which act as the “indispensable facilitator” for the “indispensable” “medium of exchange  and/or store of value”.

 

5.       The conceptualizations and the technologies used so far during the evolution of money as a social accounting system -the decentralized, disarticulated and thus autonomous and anonymous scarce “bearer token”; have had a great incidence on 1) the formation and volatility of prices and 2) the redistribution of wealth, expressed in the widening of social gaps. Thus, the technologies of money are not neutral.

 

6.       To resolve this paradox, it requires the use of a technology that emphasize the nature of money as a unit of social account to be managed by public authorities and to divorce it from its primitive nature as a token based on a scarce commodity that it have been transformed and used as speculative instrument in the financial market. As measurement standards, as in the cases of the meter or kilo; the units of account, would not change their values according to the market; they are defined and regulated publicly and internationally. Any manipulation in their established values would be considered a fraud.

 

The technological infrastructure for transparency: Money as centralized social accounting system

1.       Digital systems lend themselves to be programmable, controllable and auto executable. Money as an accounting system can be designed totally to be digital.

 

2.       Until recently, the possibility of digital money was not even thought about. However, today, its technological development is consolidated.  With this, the money is expected to recover its reason for being as a comprehensive social accounting technology, which facilitates transparent and fair exchange, which is based on the use of a stable unit of account, as the required metric for permanent and mutual comparison between the values ​​of the real economy, but without having any exchangeable value of its own, so as not to become a negotiable asset, and by transmission to become an instrument for permanent speculation and an index of volatility and chain of instability.

 

3.       When the use of the technological development of digital money is programmed to be restricted to the internal sphere of the State; money would lose the importance of its traditional characterization to be necessarily understood as a medium of exchange and / or store of value, and therefore as an instrument for capital flight and/or commodity for speculation; and instead recovers its historical reason as a social accounting system for socio-economic exchanges, and its principal function as the standard metric, as a stable social unit of account to induce transparency and fair accounting of measurement and distribution of the social values and assets in the real economy. Programmable digital money would become a public structural instrument for the implementation socio-economic policies.

 

4.       The digital money promises to be a transparent and efficient social accounting technology, which will have the capacity to be programmed and conditioned for the execution of functions according to needs, to authorize or deny the operations of exchanges according to previously defined guidelines and in real time, including the fact of conditioning the payment to socially pre-agreed pricing system.

 

5.       Articulating and conditioning the payment, through programmable digital money, allows regulating exchanges. With digital money conditioning, it serves to LINK and TIE a specific product at a defined price, to regulate the movement of goods in the national territory and control smuggling. Illegitimate operations such as money laundering, terrorist financing, money of corruption and tax evasion can be controlled. Programmable digital money will be the circuit breaker for illegitimate activities within the social economic system.

 

6.       When the Central Bank Digital Currency (CBDC) is presented as a structural part of the Technology for Price Administration (TPA); it is not to make it more efficient as a medium of exchange and / or store of value, but to recover the raison d'être of money as a transparent and stable system of the social accounting, for the measurement and distribution of collective values and to restrict the space for speculation, bidding, fluctuation and permanent instability.

 

7.       When speaking of Central Bank Digital Currency (CBDC) contemplated in this proposal, several points must be clarified:

 

a.       It is totally different from the so-called crypto currencies, which are private, speculative pseudo-money and does not meet the requirements or the functions of public money.

 

b.      With the CBDC, the State would regain full control of monetary policy, while private banking can continue to have functions, but always subordinate and well regulated and controlled by the State.

 

c.       For its internal use within the limit of a given State, the central bank digital currency does not require to be anchored to any asset, as in the case of commodity-money (a medium which has its own intrinsic value) or representative-money (money which represents something with intrinsic value), since digital currency becomes to be a mere digital register of entitlement within a centralized social accounting system. Therefore money would become a system of public utility, which should be based on and supported by a robust technological infrastructure, and an institutional and operational efficiency, which are required to maintain a secure, transparent, centralized digital accounting system.

 

d.      It requires an infrastructure and / or capacity for data and communications processing, managed entirely under the national sovereignty.

 

e.      It can work both online and offline. In this way, the system will not be vulnerable due to fluctuations in electrical and communication services, as well as it is possible to interact with the system through smart cards, without the obligation to have smart telephony, guaranteeing the possibility of including the entire population.

 

f.        It is the integral basic unit for the articulation of a centralized, digital, accounting records system, administered by the State, with a technology that guarantees greater transparency, efficiency and security, to be the bases for the transparent and fair social accounting system.

 

 

b. Subsystem 2 - Universal, single and centralized digital accounting system (CDAS)

 

Assembly of the transparency infrastructure

1.       The system is setup with the purpose of reinforcing and / or reforming existing institutions and giving them more structural roles.

 

2.       Convert the tax collection system into the collecting entity of digital data in real time, of all accounting information from socio-economic exchanges, in addition to improving the tax collection function, until achieving zero evasion and avoidance.

 

3.       The system requires moving from the periodic filing of tax returns to a complete, comprehensive and transparent accounting record, continuous in real time, and permanently interconnected with the centralized data and tax collection system.

 

Digital Fiscal Identity (DFId), the basic block for the transparency for entitlement of right and obligation

 

1.       The centralized digital accounting system (CDAS) needs to be universal, which includes all natural, legal, governmental, communal persons, foundations, and so on; not voluntary but mandatory, where all exchange transactions are digitally recorded in real time.

 

2.       To make the system to be single and centralized, where there is no other legitimate ledger; it requires that Government Resource Planning (GRP) software be chosen from among existing technologies, which should include accounting software, to be downloaded free of charge from the State fiscal platform, and authenticated for each and every one of the users according to their Digital Fiscal Identity (DFId). Each and every one of the actors whether buyer or seller, will have direct and permanent access to their own digital fiscal ledgers, where each and every one of their transactions will automatically be recorded, including targeted subsidies. Consequently, there will be NO alternate or independent ledgers that are legitimate.

 

3.       The system requires standardization and coding of each and every one of the products and services. Probably, many of them are already defined and established; beside, should be compliant and harmonized with other international systems, and encoded by barcodes or QR, for their digital integration and processing.

 

Progressive formation of the referential social pricing

1.       The system will be the informational infrastructure with which it will be possible to obtain, in a transparent and efficient manner, the cost structures, the price formation and the mobilization of the nation's inventories.

 

2.       The system will be built cumulatively, achieving in 1) the first stages some statistical references of the cost structures; and 2) progressively upon consolidation and with greater knowledge of the supply chains of the different production processes, the specificities of the possible differences in the processes and their associated costs are clarified and defined.

 

Progressive implementation

1.       The proposal contemplates that the system will begin to be applied with 1) the primary sectors of the economy, public and private, and 2) some other well-structured sectors, such as supermarket chains and the pharmaceutical sector, which from the importation and / or production of finished products or of raw materials until they reach end users, are relatively better coded, chained and regulated.

 

2.       With the expansion of the use of the supply and value chains, progress will be made in its application to secondary sectors and beyond, to cover the vast majority of the economy. Progress can be agile due to the automatic and cumulative chaining of 1) digital fiscal invoices (DFI) within the centralized digital accounting system (CDAS) and with 2) the conditioning through the most basic operations of everyday life: digital money (CBDC).

 

Progressive inclusion and formalization

1.       The proposal contemplates the need to include the rural economy and formalize the informal economy gradually, while expanding access to digital money technology, and thus increasing transparency and reducing the spaces for speculation.                

 

2.       Those who want to exchange and trade with these sectors, require a working instrument to be able to bill, collect and pay digitally; by integrating a) the digital fiscal identities (DFId) of the parties b) billing from the centralized digital accounting system (CDAS) and c) the mobilization of digital money (CBDC). The accounting platform facilitates exchange, because it allows users to be automatically identified and linked -such as a seller or a buyer-, depending on whether they charge or pay, while executing the same operation, using the same work instrument. Operations are digitally recorded in double entries in the private accounts of each digital fiscal identity (DFId) within the centralized digital accounting platform, permanently building the accounting balances and paying taxes in real time.

 

Integration of digital fiscal identity (DFId) with social policies

1.       With accurate price and inventory databases, it is possible to abandon the logic of the generalized subsidy, and instead plan a targeted and more precise subsidy system, based on 1) the socio-economic realities collected and managed by the PATRIA platform and 2) considering the reality and financial capacity of the State.

 

c. Digital fiscal invoice (DFI) and inventory control

 

Digital LINK of products to prices

1.       This proposal contemplates LINKING each product or service to a price band, without exceeding the pre-agreed maximum, through an automatic control system for payment processing, integrated with the conditioning of the programmable digital money.

 

2.       The digital fiscal invoice is the instrument that allows consolidating the LINK of prices to goods and services, through the use and conditioning of digital money. Thus, it reduces and tends to eliminate the spaces for speculation and price volatility, including that of the currency.

 

3.       For this, it is necessary that each exchange operation be regulated, approved and digitally registered in real time, including all bank financial operations, where the great mass of money moves in the form of credits; through the processing of the digital fiscal invoice which is an integral part of the centralized digital accounting system (CDAS).

 

4.       The digital fiscal invoice (DFI) must include information on: the time, the place, the digital fiscal identities (DFId) of the parties (expressed in QR), the products / services to be exchanged encoded and digitally defined (expressed in QR or barcode), the quantities or movements of the inventories, the prices of each item and the method of payment.

 

Digital control of the prices and inventories

1.       The system will have the ability to approve or deny transactions, after automatic review with the centralized digital accounting system (CDAS), where the data loaded in the digital fiscal invoice (DFI) is compared with the established references that result from the permanent analysis of the cost and price structures, and also validate them with the permanent movements of the inventories.

 

2.       The proposal establishes that only with the approval of the digital fiscal invoice, the exchange can be executed. NO swap can be made without the preapproved digital fiscal invoice, and thus to comply with tax and price administration obligations.

 

3.       If the prices to be invoiced are NOT in accordance with the established maximums, or if the merchandise to be exchanged is NOT in accordance with those declared, tracked and registered in the inventory, the transaction is blocked and cannot be executed. Consequently, there will be NO exchange of CBDC for merchandise, raising the alarm for a possible review or audit.

 

4.       Now, if everything is in accordance with the prices and the registered inventories, the payment of the operation is authorized, exchange is executed, recorded and data is updated in the centralized system. In addition, a digital copy of the invoice is issued and sent, so that each of the parties can respond and confirm the certainty of the transaction, assuming their responsibilities, protecting them against possible fraud and reducing the possibilities of anonymous operations in suspicious areas.

 

5.       So, any inspection or audit will be limited to inventory and product quality.

 

6.       If during the audit any unjustified discrepancy is detected, the supply of goods or services within the production chain is blocked. You can NOT be billed, or collected, or supplied merchandise for later circulation. You are also denied the use of the system to bill and collect for a defined time, as a punitive and deterrent measure in the future.

 

7.       It is a blocking system similar to that of SWIFT (The Society for Worldwide Interbank Financial Telecommunication), but unlike it, the Technology for Price Administration (TPA), works in favor of protecting the stability of prices and the purchasing power of citizens.

 

 

Constructing Transparency and confidence in the collective values

 

1.       The other important reason, for which the prior approval of the transaction or of the digital fiscal invoice (DFI), and subsequent confirmation by the parties thereof is required, is to achieve the mandatory nature of transparency in the construction of the databases required for the formation of cost structures, prices and registration of inventory mobilizations. This allows economic planning based on real-time information and not on estimates, speculations or market studies; in addition, for advancing in the achievement of zero evasion.

 

2.       The integration 1) of digital money (CBDC) with 2) the digital fiscal-identifications of the parties involved, and to 3) the specificity of the products and / or services defined in the digital fiscal invoice (DFI); allows to recover the personalization, socialization and articulation of money with the real economy, as technology of social accounting, for the transparent measurement and fair distribution of collective wealth, reducing spaces for speculation, reconstructing the social act of exchange and reunifying collective values, which would help to increase confidence and cohesion.

 

 

III. Objectives of digital governance

 

Control of foreign exchange market

1.       Govern the foreign exchange market with the conditioning of the programmable CBDC. The purchase or sale of foreign currency, like any other purchase, requires a digital fiscal invoice, authorized and conditioned by the price established by the Central Bank to obtain the approval for the exchange and the corresponding transfer of CBDC. Without a digital fiscal invoice, the purchase of foreign currencies cannot be paid with CBDC. With the conditioning for the transfer of the CBDC, a barrier is created that protects against currency speculation and capital flight.

 

2.       With the tying 1) of the record of movement of goods and / or of providing services 2) to a digital fiscal invoice and 3) to the programmable CBDC; will create a mechanism, which if deemed necessary, can restrict the use of foreign currencies and / or cryptocurrencies that can circulate illegitimately and corrupt the digital governance system of social exchange.

 

3.       Integrate the collection with foreign currencies, if required; by simultaneously registering two operations within the invoicing platform: 1) The exchange of foreign currencies to CBDC, according to the price of the Central Bank and; 2) Payment with CBDC for the purchase of merchandise. The foreign currency entered is required to be deposited in a bank account with digital mobilization, integrated into the national monetary system. Doing so prevent paying with foreign currency in cash from corrupting and weakening the function of the digital money system.

 

Moving From market dynamic and toward social price administration

1.       Move from market speculation towards transparent management of costs, prices, inventories and supply chains.

 

2.       Reduce the chain of unnecessary intermediaries.

 

3.       Obtain greater transparency of the stock of national inventories and their mobilizations, as well as allow greater control of smuggling.

 

4.       Limit and control spaces for crime, through the ability to monitor the movements of financial operations and inventories.

 

5.        Promote the diffusion of the digital commerce to be interconnected directly to the centralized digital accounting system (CDAS), benefiting from the acceleration of these digital implementations in one way or another.

 

Zero Evasion and improving the state planning capacity

1.       Advance in the goal of zero evasion, increase revenues for the State, allowing better budget planning. The State would move from financing the public sector with bank credits to financing with taxes; reinforcing the social state and reducing the bourgeois state based on financial capitalism.

 

2.       Achieve a computerized system to obtain a transparent, real-time database on economic realities and the availability of resources and aggregate demands as a source for national planning. Besides, with obtained price stability, long-term investments can be planned.

 

3.       Plan a stable, reliable, transparent and efficient system of rationing and targeted subsidies for the times of social and natural contingencies.

 

4.       Centralizing accounting, allows greater standardization of criteria and definitions in the digital accounting system. At the same time, it allows to reanalyze the structures of these systems, considering the need for the totality of social order and public policies. It will probably also allow redefining some accounting entries, which may better reflect collective priorities.

 

 

Consolidate the public state

1.       Increase transparency and efficiency in public administration, while reducing spaces for corruption and the speculative market.

 

2.       Reduce the public bureaucracy associated with the administration of collection, oversight, inefficiency, fraud, the justice system and the police and, probably, free a good part of these work forces to other more productive sectors.

 

3.       Reinforce the structure of the transparent and efficient social State.

 

4.       Strengthening confidence in the social State

 

5.       Preserve collective values ​​and ethics.

 

6.       Preserve the social and political order.

 

 

IV. Factors adverse to the proposal

 

Resistance from the historically vested interests

1. Conceptually, an intellectual rigidity has been developed based on the cognitive bias of assuming that the allocation of wages and prices imposed by the market are supposedly the natural, the best and the only thing possible, to the point of sustaining that position with an ideological system, refusing the possibility for being able to achieve a system of registration and administration of social exchanges with all its specificities. This objection could have validity in times past, but it must be recognized that without the technological advances of the last half century in the areas of information processing and communications, this Technology for Price Administration (TPA) could not be easily proposed or applied.

2. Similarly, it has been difficult to accept that money is a social accounting technology, evolving and changing. Also, it has been difficult to free ourselves from the fixation that money is necessarily a medium of exchange and / or store of value, that it has a market value as if it were a commodity; without understanding that these characterizations are applied only with a specific technology of money - bearer token based on scarce material - such as the gold coin. From the moment of the emergence of the conceptualization of money as fiduciary, these characterizations ceased to have the same importance. Now, with central bank digital money, the physical presence disappears, and it will become a virtual accounting system based on 1) a stable unit of account and 2) a transparent social accounting system of measurement and distribution.

3. The conceptualization 1) of the market as the best rationing system, and 2) of money as a store of values, has generated institutions and interests rooted within societies. Any readjustment of these structures will affect many interests.

4. This proposal touches the interests of both sectors, private and public, national and international, of the formal and informal economy. Therefore, possible reactions should not surprise us. In this sense, we must prepare ourselves to give the necessary answers, articulated, with the support of the majority of the beneficiaries such as workers, pensioners, consumers and all those who require a transparent, efficient and fair State.

 

Investment in Infrastructure

1.      The proposal requires significant investments, be these financial, technological and human, social and adaptive, which in the current situation of the country, are seen as difficult. However, it is important to note that the country should not have to start from scratch, because the system would complement the existing infrastructure. Probably the development of the system will be executed by modules. In this area, it is suggested to consider the possibility of financing through the Digital Silk Road of the People's Republic of China, associated with advanced technologies in the aforementioned areas.

 

2.       It requires improving and expanding the communications and electrical service networks and greater accessibility by mobile telephony and other means such as smart cards.

 

Investment in Systemization and Standardization

1.       It requires expanding the use of the digital fiscal identity (DFId), which should be mandatory with the expansion of the use of digital money and the digital fiscal invoice, and thus to integrate them for the development of the centralized digital accounting system (CDAS).

 

2.       It requires technification, expansion and acceleration in the process of standardizations and coding of products and services to facilitate digital monitoring of production supply chains and inventory mobilizations.   

 

3.       It requires digitizing the supply and value chains of financial, production, distribution, logistics and consumer processes. While the complete system is built, it is possible to start with the sectors that affect the basic basket and the pharmaceutical sector, which have the characteristic of being more structured.

 

Monetizing and targeting subsidies

1.       Unfolding the cost structures and making price formations transparent, may probably imply the need to re-analyze and transform the current system of generalized subsidies for public goods and services, and converted it into a system of targeted subsidies, with the allocations to be integrated with the PATRIA platform, in the case of Venezuela; with reflection of its uses in the fiscal accounts of each person on the State fiscal platform.

 

The collective transparency versus the privileged elite´s secrecy

1.       There are probably some privacy concerns or secrets disguised as privacy. The system is designed to offer a controllable level of anonymity. In principle, all operations are anonymous as long as no security and / or illegitimacy alarms are generated, defined in laws and regulations. In case of requirements, as an integral part of the investigations, there are different levels of authorization protocols for access to different areas and levels of information that require special reserve, such as security, defense, criminal investigation, economic planning operations and others that may be established by law.

 

 

V. When Technology Administer Prices, Societies would move from speculation towards transparency

1. How many times have price administration programs failed due to the lack of the necessary effective mechanisms to execute them?

2. With the systematic and comprehensive use of data processing and communication technologies, the social administration of prices can be made more technical, becoming a digital, transparent, efficient and fair management system, as a structural and necessary part of consolidation of the comprehensive social justice system.

3. It allows a transition from the exclusionary rationing of the free market to the social administration of production and distribution processes. It break down the fallacy that the market is the only mechanism to efficiently manage prices and the use of resources. Societies would move from speculation towards the administration.

4. With the appropriate technology and central administration of costs, prices and inventories; distortions resulting from corruption in market practices can be controlled, such as speculation, hoarding, price volatility, the black market, trafficking of prohibited goods. , smuggling, capital flight, attack on currencies.

5. The proposed system uses almost the same logic and technological developments that electronic commerce platforms (Alibaba, Amazon and others) currently use. There is no doubt that it is feasible and executable. The difference is that, in this proposal, the social State is the one who establishes and administers it, not to obtain gains in favor of individuals, but to preserve the balance and promote inclusive collective development.

6. The proposal is based on existing, proven and accessible technology and engineering.

7. This proposal recommends applying these existing and operational technologies for the social administration of prices.    

 

 

VI. Summary of the proposal´s structure

 

1. Digital fiscal Identity (DFId) (Expressed in QR, associated with digital money accounts)

2. Programmable Central Bank Digital Currency (CBDC)

3. The government resource planning system (GRP) is the management information systems

I. Universal, single and centralized digital accounting system (CDAS)

i. Systematization, standardization and coding:

1. Products

2. Processes

II. Digital Fiscal invoice (DFI)

i. Supply chains

1.       Cost structure

2.       Administration of social prices

3.       Inventory mobilization management

4. Digital commerce integrated in

I. Central bank digital currency (CBDC)

II. and centralized digital accounting system

 

 

 

By: Eng. Rafic Derjani

Email: Tap.chafefiya@gmail.com