The economy of the United Federation of Planets

In order to explain the economical development of United Earth, today’s economy must be explained first:

 

In the 24th century, the United Federation of Planets has abandoned currency-based economy for all inner affairs. Therefore, the Federation plays a unique role in economical terms throughout the known galaxy. The terms on how the most of Federation society works are laid down in the solidarity code of law (scol). While most of the assets have become obsolete due to advanced technology (e.g. medical care, food, etc.), the basics still are not unlimited. Therefore, the Federation developed a special form of distribution system in the late 2160’s that came into effect in2169. The individual regulations are very special, however the fundamental system works quite simply: A citizen or a company can choose whether to join the solidarity community or not. If they do not, they will follow the extra-solidarity code of law, earn money and pay taxes to the Federation, just like in old days. If they choose to join, they will be able to benefit from the so-called allocation-unit-system (AUS). For all work that is done, for all goods produced (that might be everything from food or energy to arts and science) the Federation generates allocation units. While every citizen is granted a basic income of allocation units in order to be able to maintain a home, travel and acquire personal belongings there are some goods that will require more allocation units. Additionally, there are some public goods that do not use up allocation units, such as food, education, medical care, legal advice or energy supply. Every person that produces any goods can submit a “solidarity declaration” to the Federation ministry of economy or the counterpart on the memberworld where the good is produced. It will be rewarded with additional allocation units that are added to the individual allocation unit account. If a person chooses to acquire something that is produced in a more costly way, (e.g. a personal vessel or a factory or personal property) the allocation units necessary for the production are revoked and considered invested.

 

Thus, a company that produces computer programs will not have to pay the employees in any way but submit a solidarity declaration to the ministry. The company will then receive allocation units for the produced goods, while the employees receive allocation units for their work.

 

The system is possible because energy, food, education and medical care, the foundations for making a living, were declared to be public free goods in the Federation in 2168. As a matter of fact, all technologies and goods necessary to maintain those free goods are by law property to the Federation herself. This also applies for any newly developed methods and technologies. While there still are some private companies that specialize on public goods, most suppliers nowadays are public corporations. In order to maintain those public goods, the Federation would also be entitled to expropriate any private corporation. However, this only been done a couple of times in all of Federation history, the most recent example being the expropriation of an energy-corporation on Betazed during the Dominion war in order to be able to redistribute energy more quickly to the defense grid (the corporation was re-privatised in 2375).

If a citizen or a corporation trades with anyone that is not part of the solidarity community and acquires any form of money, the money would be transferred to the Federation and applied against allocation units.

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