Sunday, 19 July 2015

Transitioning to an economy based on sharing information

The Transition Town movement is largely about envisioning a future of locally grown food, community-owned power stations, local currencies … and small-scale actions.
Local, self-sufficient, optimistic: are Transition Towns the way forward? | Environment | The Guardian

There are plenty of different future scenarios out there:
Futures Forum: it's happening @ 10:10 >> "Real signs of a brighter future"
Futures Forum: The Future of our Food ........ on Costing the Earth
Futures Forum: On the Transition: "Future Primitive"
Futures Forum: Localism and the future of the 'Big Society'
Futures Forum: Aero Island in Denmark: Behind the times or way ahead?
Futures Forum: "The emergence of peer-to-peer lending, fintech and new forms of currencies mean people and businesses can act on their dissatisfaction with the big banks"
Futures Forum: "Exposing the futuristic fantasies deployed by the fossil-fuel companies"
Futures Forum: Climate change... and 'Interstellar': 'Cli-fi' escapism?
Futures Forum: Climate change: Jonathan Porritt, the Forum for the Future and 'The World We Made'
Futures Forum: "Abundant, cheap electricity has been the greatest source of human liberation in the 20th century."

But the dominant notion of the 'future' has been of 'technological progress':
Futures Forum: A history of predicting technological advances >>> Tomorrow's World at 50 on BBC Radio 4

However, the transition to the promised land of hi-tech has been a long time coming:
Futures Forum: "Where are the flying cars?" or, "What happened to derail so many credible ideas and prospects?"
Of Flying Cars and the Declining Rate of Profit - The Baffler

An explanation comes from anthropologist David Graeber: 
... since the 1970s there has been a shift from technologies based on realising alternative futures to investment technologies that favoured labour discipline and social control. Hence the internet. “The control is so ubiquitous that we don’t see it.”
David Graeber interview: ‘So many people spend their working lives doing jobs they think are unnecessary’ | Books | The Guardian

Evgeny Morozov, author of the Net Delusion: The Dark Side of Internet Freedom, has been pointing out the dangers inherent in 'information technology' for some time:

The latest trade deal to be passed by the EU will see us sacrifice our commitment to data protection
What happens when policy is made by corporations? Your privacy is seen as a barrier to economic growth | Comment is free | The Guardian

Silicon Valley holds out the promise of connectivity for all. But there’s a price to pay
Facebook isn’t a charity. The poor will pay by surrendering their data | Technology | The Guardian

The tech industry says it can tackle inequality, and governments are keen to let it try. The choice that citizens now face is not between the market and the state, but between politics and non-politics
Silicon Valley likes to promise ‘digital socialism’ – but it is selling a fairy tale | Evgeny Morozov | Comment is free | The Guardian

Channel 4's economics editor Paul Mason has a new book out which deals with this:
Paul Mason • My 18 minute talk on PostCapitalism for...

Here is a sceptical view of the 'transition' he is forecasting:
Paul covered a lot of ground, but his central thesis seemed to be that the information revolution has meant a de-coupling of the economy from material usage (as when software is manufactured, commodified and consumed), with a parallel accelerating reduction in the cost of information infrastructure (storage, processors, etc. etc.). 
The growth of peer to peer economic relations and the contradictions of both neoliberalism (no more than 50 years old) and capitalism (500 years old) means a potential exit from the latter.
I would say that, sadly, there is still much life in the beast yet – it has proved endlessly inventive and energetic in overcoming its periodic contradictions. But it is the external contradictions, which include climate change, that are likely to destroy it, taking us with it. Meanwhile the idea of the emergence of a new mode of production to replace capitalism seems as remote as the idea of open-source software heralding the transition to a solidarity economy.
Economics is for Everyone: Paul Mason - a quick reaction - Post-Crash Economics Society

Nevertheless, the immediate crisis in Greece has thrown up all sorts of questions about a 'transition' to something else:
Futures Forum: Solidarity, the DIY-aid movement and civil society >>> transitioning to a sustainable society, a resilient economy

Whether this 'something else' is 'post-capitalist', that's difficult to say, but in this piece in yesterday's Guardian, he quotes from a Greek activist pointing to one possible way ahead: 
to create networks you can’t default on:

Here is an edited version:

Without us noticing, we are entering the postcapitalist era. At the heart of further change to come is information technology, new ways of working and the sharing economy. The old ways will take a long while to disappear, but it’s time to be utopian

Postcapitalism is possible because of three major changes information technology has brought about in the past 25 years. First, it has reduced the need for work, blurred the edges between work and free time and loosened the relationship between work and wages. The coming wave of automation, currently stalled because our social infrastructure cannot bear the consequences, will hugely diminish the amount of work needed – not just to subsist but to provide a decent life for all.
Second, information is corroding the market’s ability to form prices correctly. That is because markets are based on scarcity while information is abundant. The system’s defence mechanism is to form monopolies – the giant tech companies – on a scale not seen in the past 200 years, yet they cannot last. By building business models and share valuations based on the capture and privatisation of all socially produced information, such firms are constructing a fragile corporate edifice at odds with the most basic need of humanity, which is to use ideas freely. 
Third, we’re seeing the spontaneous rise of collaborative production: goods, services and organisations are appearing that no longer respond to the dictates of the market and the managerial hierarchy. The biggest information product in the world – Wikipedia – is made by volunteers for free, abolishing the encyclopedia business and depriving the advertising industry of an estimated $3bn a year in revenue.
Almost unnoticed, in the niches and hollows of the market system, whole swaths of economic life are beginning to move to a different rhythm. Parallel currencies, time banks, cooperatives and self-managed spaces have proliferated, barely noticed by the economics profession, and often as a direct result of the shattering of the old structures in the post-2008 crisis.
You only find this new economy if you look hard for it. In Greece, when a grassroots NGO mapped the country’s food co-ops, alternative producers, parallel currencies and local exchange systems they found more than 70 substantive projects and hundreds of smaller initiatives ranging from squats to carpools to free kindergartens. To mainstream economics such things seem barely to qualify as economic activity – but that’s the point. They exist because they trade, however haltingly and inefficiently, in the currency of postcapitalism: free time, networked activity and free stuff. It seems a meagre and unofficial and even dangerous thing from which to craft an entire alternative to a global system, but so did money and credit in the age of Edward III.
Post-capitalism apple trees. Illustration by Joe Magee
witterPinterest Sharing the fruits of our labour. Illustration by Joe Magee

New forms of ownership, new forms of lending, new legal contracts: a whole business subculture has emerged over the past 10 years, which the media has dubbed the “sharing economy”. Buzzwords such as the “commons” and “peer-production” are thrown around, but few have bothered to ask what this development means for capitalism itself. 
Today there is no pressure from the workforce, and the technology at the centre of this innovation wave does not demand the creation of higher-consumer spending, or the re‑employment of the old workforce in new jobs. Information is a machine for grinding the price of things lower and slashing the work time needed to support life on the planet. 
As a result, large parts of the business class have become neo-luddites. Faced with the possibility of creating gene-sequencing labs, they instead start coffee shops, nail bars and contract cleaning firms: the banking system, the planning system and late neoliberal culture reward above all the creator of low-value, long-hours jobs.
Innovation is happening but it has not, so far, triggered the fifth long upswing for capitalism that long-cycle theory would expect. The reasons lie in the specific nature of information technology. 
We’re surrounded not just by intelligent machines but by a new layer of reality centred on information. Consider an airliner: a computer flies it; it has been designed, stress-tested and “virtually manufactured” millions of times; it is firing back real-time information to its manufacturers. On board are people squinting at screens connected, in some lucky countries, to the internet.
Seen from the ground it is the same white metal bird as in the James Bond era. But it is now both an intelligent machine and a node on a network. It has an information content and is adding “information value” as well as physical value to the world. On a packed business flight, when everyone’s peering at Excel or Powerpoint, the passenger cabin is best understood as an information factory.

Postcapitalism evolution. Illustration by Joe Magee

Is it utopian to believe we’re on the verge of an evolution beyond capitalism? Illustration by Joe Magee

But what is all this information worth? You won’t find an answer in the accounts: intellectual property is valued in modern accounting standards by guesswork. A study for the SAS Institute in 2013 found that, in order to put a value on data, neither the cost of gathering it, nor the market value or the future income from it could be adequately calculated. Only through a form of accounting that included non-economic benefits, and risks, could companies actually explain to their shareholders what their data was really worth. Something is broken in the logic we use to value the most important thing in the modern world.
The great technological advance of the early 21st century consists not only of new objects and processes, but of old ones made intelligent. The knowledge content of products is becoming more valuable than the physical things that are used to produce them. But it is a value measured as usefulness, not exchange or asset value. In the 1990s economists and technologists began to have the same thought at once: that this new role for information was creating a new, “third” kind of capitalism – as different from industrial capitalism as industrial capitalism was to the merchant and slave capitalism of the 17th and 18th centuries. But they have struggled to describe the dynamics of the new “cognitive” capitalism. And for a reason. Its dynamics are profoundly non-capitalist.
During and right after the second world war, economists viewed information simply as a “public good”. The US government even decreed that no profit should be made out of patents, only from the production process itself. Then we began to understand intellectual property. In 1962, Kenneth Arrow, the guru of mainstream economics, said that in a free market economy the purpose of inventing things is to create intellectual property rights. He noted: “precisely to the extent that it is successful there is an underutilisation of information.”
You can observe the truth of this in every e-business model ever constructed: monopolise and protect data, capture the free social data generated by user interaction, push commercial forces into areas of data production that were non-commercial before, mine the existing data for predictive value – always and everywhere ensuring nobody but the corporation can utilise the results.
If we restate Arrow’s principle in reverse, its revolutionary implications are obvious: if a free market economy plus intellectual property leads to the “underutilisation of information”, then an economy based on the full utilisation of information cannot tolerate the free market or absolute intellectual property rights. The business models of all our modern digital giants are designed to prevent the abundance of information.
Yet information is abundant. Information goods are freely replicable. Once a thing is made, it can be copied/pasted infinitely. A music track or the giant database you use to build an airliner has a production cost; but its cost of reproduction falls towards zero. Therefore, if the normal price mechanism of capitalism prevails over time, its price will fall towards zero, too.
For the past 25 years economics has been wrestling with this problem: all mainstream economics proceeds from a condition of scarcity, yet the most dynamic force in our modern world is abundant and, as hippy genius Stewart Brand once put it, “wants to be free”.
There is, alongside the world of monopolised information and surveillance created by corporations and governments, a different dynamic growing up around information: information as a social good, free at the point of use, incapable of being owned or exploited or priced. I’ve surveyed the attempts by economists and business gurus to build a framework to understand the dynamics of an economy based on abundant, socially-held information. But it was actually imagined by one 19th-century economist in the era of the telegraph and the steam engine. His name? Karl Marx.
The scene is Kentish Town, London, February 1858, sometime around 4am. Marx is a wanted man in Germany and is hard at work scribbling thought-experiments and notes-to-self. When they finally get to see what Marx is writing on this night, the left intellectuals of the 1960s will admit that it “challenges every serious interpretation of Marx yet conceived”. It is called “The Fragment on Machines”.
In the “Fragment” Marx imagines an economy in which the main role of machines is to produce, and the main role of people is to supervise them. He was clear that, in such an economy, the main productive force would be information. The productive power of such machines as the automated cotton-spinning machine, the telegraph and the steam locomotive did not depend on the amount of labour it took to produce them but on the state of social knowledge. Organisation and knowledge, in other words, made a bigger contribution to productive power than the work of making and running the machines.
Given what Marxism was to become – a theory of exploitation based on the theft of labour time – this is a revolutionary statement. It suggests that, once knowledge becomes a productive force in its own right, outweighing the actual labour spent creating a machine, the big question becomes not one of “wages versus profits” but who controls what Marx called the “power of knowledge”.
In an economy where machines do most of the work, the nature of the knowledge locked inside the machines must, he writes, be “social”. In a final late-night thought experiment Marx imagined the end point of this trajectory: the creation of an “ideal machine”, which lasts forever and costs nothing. A machine that could be built for nothing would, he said, add no value at all to the production process and rapidly, over several accounting periods, reduce the price, profit and labour costs of everything else it touched.
Once you understand that information is physical, and that software is a machine, and that storage, bandwidth and processing power are collapsing in price at exponential rates, the value of Marx’s thinking becomes clear. We are surrounded by machines that cost nothing and could, if we wanted them to, last forever.
In these musings, not published until the mid-20th century, Marx imagined information coming to be stored and shared in something called a “general intellect” – which was the mind of everybody on Earth connected by social knowledge, in which every upgrade benefits everybody. In short, he had imagined something close to the information economy in which we live. And, he wrote, its existence would “blow capitalism sky high”. 
With the terrain changed, the old path beyond capitalism imagined by the left of the 20th century is lost.
But a different path has opened up. Collaborative production, using network technology to produce goods and services that only work when they are free, or shared, defines the route beyond the market system. It will need the state to create the framework – just as it created the framework for factory labour, sound currencies and free trade in the early 19th century. The postcapitalist sector is likely to coexist with the market sector for decades, but major change is happening.
Networks restore “granularity” to the postcapitalist project. That is, they can be the basis of a non-market system that replicates itself, which does not need to be created afresh every morning on the computer screen of a commissar.
The transition will involve the state, the market and collaborative production beyond the market. But to make it happen, the entire project of the left, from protest groups to the mainstream social democratic and liberal parties, will have to be reconfigured. In fact, once people understand the logic of the postcapitalist transition, such ideas will no longer be the property of the left – but of a much wider movement, for which we will need new labels. 
This will be more than just an economic transition. There are, of course, the parallel and urgent tasks of decarbonising the world and dealing with demographic and fiscal timebombs. But I’m concentrating on the economic transition triggered by information because, up to now, it has been sidelined. Peer-to-peer has become pigeonholed as a niche obsession for visionaries, while the “big boys” of leftwing economics get on with critiquing austerity.

Illustration by Joe Magee
 Information wants to be free. Illustration by Joe Magee

In fact, on the ground in places such as Greece, resistance to austerity and the creation of “networks you can’t default on” – as one activist put it to me – go hand in hand. Above all, postcapitalism as a concept is about new forms of human behaviour that conventional economics would hardly recognise as relevant.
So how do we visualise the transition ahead? 
We can predict, from this, that postcapitalism – whose precondition is abundance – will not simply be a modified form of a complex market society. But we can only begin to grasp at a positive vision of what it will be like. 
Today, the thing that is corroding capitalism, barely rationalised by mainstream economics, is information. Most laws concerning information define the right of corporations to hoard it and the right of states to access it, irrespective of the human rights of citizens. The equivalent of the printing press and the scientific method is information technology and its spillover into all other technologies, from genetics to healthcare to agriculture to the movies, where it is quickly reducing costs.

The modern equivalent of the long stagnation of late feudalism is the stalled take-off of the third industrial revolution, where instead of rapidly automating work out of existence, we are reduced to creating what David Graeber calls “bullshit jobs” on low pay. And many economies are stagnating. 
Once you understand the transition in this way, the need is not for a supercomputed Five Year Plan – but a project, the aim of which should be to expand those technologies, business models and behaviours that dissolve market forces, socialise knowledge, eradicate the need for work and push the economy towards abundance. I call it Project Zero – because its aims are a zero-carbon-energy system; the production of machines, products and services with zero marginal costs; and the reduction of necessary work time as close as possible to zero.
Most 20th-century leftists believed that they did not have the luxury of a managed transition: it was an article of faith for them that nothing of the coming system could exist within the old one – though the working class always attempted to create an alternative life within and “despite” capitalism. As a result, once the possibility of a Soviet-style transition disappeared, the modern left became preoccupied simply with opposing things: the privatisation of healthcare, anti-union laws, fracking – the list goes on.
If I am right, the logical focus for supporters of postcapitalism is to build alternatives within the system; to use governmental power in a radical and disruptive way; and to direct all actions towards the transition – not the defence of random elements of the old system. We have to learn what’s urgent, and what’s important, and that sometimes they do not coincide
The end of capitalism has begun | Books | The Guardian

" Spanish sociologist Manuel Castells argues that the internet has altered protest movements forever. But while he says online activism can be effective, recent major political change has required boots on the ground -- and the intersection between urban space and cyberspace is where to find the most interesting modern political movements" (The Guardian)

Manuel Castells: how modern political movements straddle urban space and cyberspace - video | Comment is free | The Guardian
Manuel Castells: How modern political movements straddle urban space and cyberspace - YouTube

See also:
Futures Forum: The language of bureaucracy >>> David Graeber and "The Utopia of Rules: On Technology, Stupidity, and the Secret Joys of Bureaucracy"
Futures Forum: "Where are the flying cars?" or, "What happened to derail so many credible ideas and prospects?"
Futures Forum: An Exeter Pound: What came first: money or debt? ......... David Graeber's "Debt: The First 5000 Years"

On the Phenomenon of Bullshit Jobs - STRIKE!
David Graeber on the Utopia of Rules: Why Deregulation is Actually Expanding Bureaucracy

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