Join the new world

Since I joined Theocracy we had three economic reforms. And although they were useful in helping us secure our nation, they are also exhausting our economy due to the lack of CHF circulation.

The economic reforms

Our first economic reform set the tax structure that we have today, the salaries to (skill + 1) × 5 CHF with 15 CHF as minimum salary, and the exchange rate to 1 CHF = 0.010 gold. When I got here we had the salaries and the tax rate done while recovering the value of the CHF from 0.007 to 0.010. The price of food Q1 was set to the same 2.25 CHF that we have today. Here we had the seed of a proble we are facing today, four months later.

The second and the third reforms were minor adjustments that made we worse of. First we changed our salaries to (skill + 1) × 7 CHF. And later we appreciated the CHF to 0.015 gold and set the price of several products to be sold in the Swiss market. At that time I was pretty happy because I was able to buy moving tickets and weapons Q1 to use with my free pass every four days. At that time I rarely had more than 100 CHF in my account. We didn't have active battles from Switzerland at that time, so I had to buy the moving tickets and ask someone to fire me in the chat to use my free pass. And because I have my companies too, I was able to fight abroad every day I had a free pass.

But it doesn't happen anymore. Now I have more than 400 CHF in my account, we are selling only food Q1 in our market again and we have no free pass, even tho there is no battle from home. What is going wrong?

The problems we have from the economic reforms

First, we sent our most productive workers in manufacture to Italy to produce weapons Q5. those weapons are good for two things: (i) to bet on someone to be a battle hero in a big battle, and (ii) to sell. Weapons Q5 are not good for hospital fights and for all prices I've seen so far they were never the best for tanking (using with wellness pack). You can usually do more damage at the same cost fighting more times with Q3 or Q4 weapons. So, if we can sell the weapons they are producing there, we are making good use of their skill, even better than if they were here. But the problem is that those same theocrats were the ones responsible for the companies here in Switzerland, and they lost a little bit of the touch as they had to share their attention in two countries and got busier in real life. We all felt that.

Second, as well as our companies can't use CHF to buy raw materials (roughly speaking, as I explained it in Challenges for the Theocratic Economy), we can't do anything with our CHF except buying items in our market or selling it in the monetary market. My skill level is at 6, which means I'm paid 24.50 CHF after taxes. I have to buy one Q1 food for 2.25 CHF, so I keep 22.25 CHF in the end of the day, more than 90% of my salary. If I sell it to someone in the monetary market that is not the Holy Pantheon I'll just be giving ammunition to someone that will attack our exchange rate tomorrow. If we can't spend our CHF, it doesn't go back to our treasury or our companies. At some point we will need to print CHF to keep our companies, but we should never actually need that.

Third, the combination of less workers by sending our folks to work in Italy and to run for congress there (less productivity in the companies) with higher salaries from our second economic reform and higher CHF value from the third reform (higher cost in CHF for our companies) made our companies more vulnerable to the economic cycles and many of them unprofitable. This means that even if we take the revenue from some of them in gold and try to buy the net salaries paid in CHF, we can't recover it all. And I'm taking taxes out of the salaries, both income and VAT. Taxes are not the problem: our cost is. We should have kept our salaries lower. We should had never hanged our exchange rate. The only thing we should have done from the second and third reforms was to sell more products in our market.

What can we do to tackle those problems

Now we can either let our exchange rate go down to 0.007 again or decrease the salaries back to (skill +1) × 5 CHF to have the same cost structure in gold that we had before the second and third economic reforms. This is a must if we want to be able to give free pass to the soldiers in Switzerland again.

We also have to place better our workers. High quality companies must work with 10 employees whenever possible, specially the weapons companies. We should fill the gift companies with export licenses before the ones that can sell only in our market. If we have to make some employees have a penalty on productivity because of the number of employees, let's make sure they re the ones with lowest skill. Some of us have high skill, but not a Q5 house: they should work in companies like weapons Q1, gifts or moving tickets to optimize our welfare system.

And finally, we must sell more products in our market for profit without compromising the stocks of the army. We need moving tickets and gifts to deploy. Hundreds. But much less than what we need on weapons. Since this is also the product that has higher potential demand in our market as well we can open one more Q1 weapons company to sell exclusively in our market (good news is we will do that soon). And we can have both companies selling in our market when the stock is above the one desired by the army. Those weapons will not be the cheapest in the world but they will be the best alternative in our market for sure and a good alternative for those willing to use their CHF.

Some final words on the Challenge series and my background work

The four articles I wrote, including his one, have mainly two purposes. The first one is to bring our new members and our old members closer to each other. Theocracy is about role playing, friendship, making a group stronger than individuals, and trust. But we also have to deal with the challenges imposed by the mechanics of the game like any other nation. Here we can do it together. I am an example that anyone from any nation can get involved in Theocracy and reach a position people outside never thought it could be possible for a non-italian. But our council needed to put her eyes back to Switzerland and our newbies have to know them better.

The second purpose is I'm about to become unreachable for a long period of time. I created a whole set of spreadsheets to help manage the army and the companies. We can have estimates from our damage in a battle less than 5 minutes after it finishes. We can see in one single page all companies that need raw materials and what is their daily consumption if everybody works. And much more. All we need is the API working to use them. These articles I wrote come from my experience in touch with the Dio's and all the work I went through to satisfy my curiosity and to provide us instruments to improve Theocracy. They carry some unpopular comments and a lot of my personal opinion on what I think we should do. But it is not what we will do. Those walls of text have everything I couldn't wait to say. So I hope the small repercussion I can get from the comments can bring the attention of our council here to make my voice while I'll not be able to speak.