Chapter 55:

There was an urgent call by the Goblins for another grand economic meeting.

Bardoc, a member of Gringotts bank opened the conference, "For a few years now, extraordinary efforts have been made by skilled spell casters and skilled non-spell casters, motivated by the idea of saving Earth from being unprepared for extra-terrestrial contact. That goal has been achieved.

At this time, Starfleet is trying to increase production for the goal of building a presence on nearby worlds. This takes more resources than its previous goals of research and development. Now you want to use the results of your research and build many examples of your latest designs.

Your economic system is not well thought our for this phase, and the fact that it worked for the previous phase has blinded you to this inevitability. It is time to have an economy that works, not one that gets by on an emergency basis.

First, we can look at what is working. The Basic Living Centers are remarkably efficient in terms of use of skilled labor, the main economic constraint. Therefore, those who have removed themselves from the economy are not causing much of a drain on those who are supporting it. I will not mention my personal views on this, but you can probably guess what they are.

What they have caused is a higher level of working conditions and pay for many jobs, which while nice for those involved in production, makes consumption more expensive. People doing what fulfills them do not fill every job opening, without much higher than expected pay offers. I'll give an example. For various reasons a potions master was selected to be a diplomat. If you had asked him to invent a new potion, he'd be honored. If you had asked him to make potions, well that is what he was already doing for a high price. Ask him to be a diplomat? He agreed only in exchange for extremely high pay.

This is what must be solved. How to get those with needed skills to apply them to needed tasks, and how to convince those who are trainable to increase their skills. In the Goblin nation, we have our ways, but those ways are not part of the Starfleet culture."

Albus Dumbedore replied, "One method that Wizarding Britain has used for the training aspect of the challenges Bardoc presented, is to require a certain level of education in magic in order to be allowed to use magic. Minimum educational requirements throughout the world, for what we call the OWL level, could be increased to include the skills most in need now."

Director Morozov spoke next, "I agree with Bardoc. For brief period, patriotism can motivate. Now economics reasserts self. Soviet method led to decline, also not work. Markets, while messy, have worked in past, invent new ways of business that central planners not think of.

Basic Living Centers not the problem. Those satisfied with it were not going to contribute much anyway. With magic and automation no longer need huge numbers of unskilled. No-one needs to turn a wrench all day on assembly line, or dig potatoes. Not to speak against my good friend who tends grapes, he do so because he wants to and can get better quality than automation could.

Extraordinary crafts persons in all fields represent best in humanity. Millions doing what they think is drudgery not best of humanity.

However, automation not run itself. One thousand people can, all steps included, make five million bags of potato crisps a week, numbers illustration only, not exact. Maybe one day 100 can do same. Still need these people. Potato crisps not free, plenty of money to pay those people well. If someone else starts pure magic company and do same cheaper, better for everyone, after first group finds new things to do.

To invent warp drive, no problem, great minds want to be part of it. To build fleet of cargo ships for colonists on other worlds? Not as easy to find volunteers. Need to pay them. Where to find money? Maybe taxes. Maybe fees. Maybe fees to be transported to colony. Maybe colony pay for supplies. Starfleet not needed to organize everyone for ever more. Maybe now, Starfleet goal to settle other worlds, so pay for now, but later society living there pay own way. However must find way to keep loyalty towards Starfleet.

In 1990's Kazakhstan, we started companies with better efficiency and technology to generate money for Starfleet operations there. This model no longer work. Everyone have access to best methods. State run enterprise not have advantages any longer. Best to let market work, but prevent corruption, monopolies, regulatory capture. Get money from taxes."

I spoke next, "Morozov's plan seems to be the best available. How do we apportion it? Direct taxes of economic activities to Starfleet, or allocations to each government for them to decide how to tax and deliver to Starfleet? Also keep in mind that what is taxed is discouraged. How do we maximize prosperity while funding the continuing goals of Starfleet?"

Bardoc answered, "Now you see the problem. It comes down to the flow of money to make an economy work. Maybe Starfleet needs a budget, and then you can decide how to spend it, and not just say three starships for every star within 15 light years, without even thinking about how much that would cost.

Start with a taxation level that the economy can sustain, then subtract the public works which you'd now not be able to reduce, and the remainder is your budget for R&D plus construction plus operations.

Also understand what your true constraints are. You can easily find the personnel. You could even charge them to be crewmembers instead of paying them, but that goes against your philosophy. R&D has been done, so it makes sense to think you can build a lot of ships, now that the difficult part has been done. However, building ships takes a lot of work, even with magic. This is your constraint."

The meeting ended there, with that basic consensus, to be followed up by the long process that our consensus based government uses to actually get governments to agree to taxation by Starfleet. For non-magical governments it would be a matter of adding to taxation that already exists. For magical governments, the idea of taxation of individuals was not regarded well, although tariffs and taxation of large scale trading was considered acceptable.

The consensus in the ICW was to tax magical items for sale, including potions, but not potion ingredients. Large scale enterprises would also be taxed, but not small craft makers.

There was an idea to require spell casters to help out by casting spells a certain number of days per year, for Starfleet, but the opposition was too much and the idea was abandoned.

The idea to increase required education was not agreed to, but having every school for 11 to 17 year olds teach the abilities needed by Starfleet, and encourage students to learn these subjects, was agreed to. Besides, the notion of minimum standards to be allowed to use a wand was being phased out. Instead they were being replaced with rules about supervision and limits to what one could do unsupervised. It was not an all or nothing threshold anymore.

The Starfleet part of the plan was implemented immediately. All Starfleet owned companies were put up for sale at relatively high prices, not for auction. It might take a while to sell them, but the sales will generate some good revenue for Starfleet until taxation can be started.

All Starfleet technologies were available for all companies to use for free. Technologies that were military secrets were also available to use for free, but with sufficient secrecy, more or less how military contractors already operated. The various contractors would bid against each other to supply Starfleet, while demonstrating sufficient quality and reliability of delivery volumes.

All Starfleet affiliated countries allowed universal cross-licensing of all relevant technologies, which are almost all technologies. Further, trade secrets of technology were discouraged, with heavy disincentives. However, grants were given by Starfleet for research. It was altogether complicated and bureaucratic, but it needed to be. It was simpler when Starfleet did everything itself, but with the new system, Starfleet didn't want technological progress slowed down by silos of information. The basic aim was for Starfleet to do the research, and companies to compete for better production. It also reflected the reality of inventions being quickly copied and put into production elsewhere.

The consensus was that this change to having Starfleet use contractors was an experiment. Many worried about corruption, and decision makers at Starfleet favoring the interests of contractors. A fairly robust anti-corruption section was started, that also investigated themselves. The consensus was that Starfleet would reacquire the contractors if these arrangements were not serving the interests of Earth.

The two starships arrived at Proxima Centauri. After determining that there was no technological presence, and finding no sentient life, they started one space station in orbit of the star. Only after exploring the other two stars would the fleet decide where to place the other stations, with Proxima Centuari 2, previously called "b", being a good candidate for a colony. After outfitting the station with armaments, the fleet moved on to the next star in the Centuari system. Starfleet doctrine, based on exhaustive simulations done by Starfleet India, is that starships always travel in pairs, and preferably in groups of at least three.

After investigating all three stars, the ground bases were designated for Proxima 2, and Alpha A 3. Each of those planets also got an orbital station, and the other orbital stations around A, B, and B 4. None of these were considered starbases yet. There was a set of capabilities defined before a station could be called a starbase, including ship maintenance, a large population, and most of the manufacturing abilities found on Earth.

The two starships there would remain there unless relieved. Another two were dispatched there, so four would be on station in the Centuari system. Three more ships were dispatched to Barnard's star, also with the ability to leave behind three orbital stations and one ground station. A steady flow of ships were started between Sol and Centauri. Mostly what was sent were infrastructure to make use of local materials to build everything needed. Additional colonists were steadily being sent. Many more people on Earth wanted to live in space colonies than there was infrastructure for them.

Every colonists were considered Starfleet personnel, so each could be assigned to work as needed. There couldn't be people on the colonies not pulling their weight, at least until they would be at a much later stage of development.

Trade with Vulcan started to become more regular, although still negotiated between the governments. The wanted various magical devices, replicated Dilithium Crystals, and information, such as the entire record of music and art from the planet. The later would have been given to them for free, but it was negotiated to get technologies from Vulcan that help with automated production. Earth had an unlimited need for anything that could help them produce more with fewer workers.