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Everything written by Michel Bauwens

Towards Blockchain Companies

photo of Michel Bauwens

Michel Bauwens
20th October 2014


Excerpted from John Robb:

“A blockchain company isn’t like any company you know.

It’s not run organically (it doesn’t have faux person-hood). It doesn’t have CEO, COO or effing board of directors. It doesn’t go to a fund or a bank for funding. It never floats an issue on Wall Street. Blockchain companies don’t need all of that legal cruft and the parasitic overhead that comes with it.

The entire company is simply open source software. It’s built to provide a function and divide up the rewards of providing that function to the participants.

A company like this runs as software, in the same way bitcoin is run: decentralized. That means the company doesn’t pivot, reorganize, or recapitalize. It either provides a useful function it gets paid to do, or it doesn’t. If it doesn’t work, it is replaced by a new company that does it better.

A blockchain company doesn’t have shares of stock. Everything that it earns is paid to the people in possession of the companies coin on a pro rata basis (using the blockchain currency of choice). Ownership is simply a call on this revenue, and all it is paid out in real time.

Earning a blockchain company’s coin is done by the company’s participants. You can earn coin doing everything from providing cloud services to doing the same types of stuff you already do online (writing, rating, and curating). There are ways to measure all of this and connect these activities to revenue.

Investment, to the extent it is needed to launch a venture is crowdsourced, usually by prepurchasing goods and services to be delivered in the future.

A blockchain company doesn’t need Silicon Valley, Wall Street or Washington.

It just needs to be open, decentralized, and useful enough to suck value out of the old economy.”

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Posted in Economy and Business, Ethical Economy, P2P Business Models, P2P Governance | No Comments »

Tiziana Terranova reports on Social Network Unionism Strategies in Europe

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Michel Bauwens
20th October 2014


(via the networked labour mailing list; version without notes; this article introduces some new developments in p2p-driven labor strategies)

Tiziana Terranova:

“Over the past few years, European social movements have struggled to find new ways of cooperating and connecting in order to oppose the verticalization of European governance. Following the crash of 2008, in fact, a regime of austerity, that is severe cuts to public spending, has gone together with a remodulation of modes of welfare and work inspired by the German model. This model has seen the massive introduction of part-time, badly paid jobs (the so called *mini-jobs* ) which are part of a system of workfare where the state makes sure that everybody is forced to accept whatever job available through a new capillary control of recipients? lives. While the European Central Bank like the Federal Reserve has deployed quantitative easing, and inundated the financial system with money, none of this has effectively gone into the creation of new jobs, into expanding credit to consumers and business or to essential public services. The process of complete precarization of labor and increasing accumulation of wealth is thus unfolding along the lines of a geographical and ethnic division of labor which sees the European Union divided between centre and periphery, North and South, East and West with war pressing in on its Eastern and Southern borders.

The verticalization of European governance has thus reinforced a whole series of trends: “the attack on waged labor, the compression of union rights, the dequalification and privatisation of learning and research, the enclosure of common goods, a new government of labor mobility and the exploitation of migrant labor” (http://www.autistici.org/strikemeeting/). These considerations are central to the formation of a transnational space of action for social movements aiming to reverse the tide of complete neoliberalization of Europe and opening onto the global level as the only adequate dimension of struggle.

At the core of the summer school of the Euronomade free university network which took place in Passignano sul Trasimeno, Italy in September 2014 was the relation between this crucial importance of the geopolitical dimension in the unfolding of financial command over the productive cycle and new forms of unionism. The traditional trade unions have in fact proven themselves completely unable to answer new demands emerging out of a dispersed and individualized workforce which is no longer primarily assembled in factories (or only in the most transient form with high turnover of workers) but, as Stefano Harney has argued, through the expansion of the assembly-line by means of a generalized logistical infrastucture through the whole of society and across all geographical borders. It is in this context that what was once called peer production has become effectively integrated in the *keizen *line of logistics: synaptic labor performed under the mode of forced continous improvement spurred by performance metrics and analytics. (Harney 2014)

In a document authored by the Pisa-based Italian collective exploit directed at the usual technology hype of the Internet Festival 2014, the appeal of the mythology of the digital entrepreneurs has also been shown to be fading (eXploit 2014). While the latter continue to espouse the image of the Internet as a revolution induced by free market capitalism able to welcome new ideas and reward them with wealth while promoting social progress, it has in fact produced new monopolies and the progressive deterioriation of working and living conditions for the many. This is evident at all three levels of exploitation enacted by the digital economy as summarized by exploit: the material infrastructure of digital devices which is increasingly under the control of large multinational corporations mining minerals in Africa and able to outsource production where labor is less paid and protected; the immaterial level of software production, web services and crowdsourcing where labor is once again ever more precarious, underpaid and fragmented; and the large market in metadata which extracts value out of the most mundane acts of digital communication. This scenario postulates a “extractivist” model of accumulation where the inorganic, organic and the social strata are put to work, that is commanded and forced to yield surplus value, expressing new challenges and demanding new strategies. As the eXploit collective put it, the collective ?rewriting of the operating system? of the digital economy and the “breakdown of the rules of the market” appear as primary condition to reconquer that share of wealth produced by social cooperation but appropriated and controlled by the few.

The main challenge of organizing a labor force which unfolds throughout society and according to intermittent times lies in the strong individualisation of cognitive labor: “cognitive labor is labor without factories, as fixed place of exploitation and class recomposition which makes more difficult the formation of a class consciousness among cognitive workers. For the same reason? because of the temporal fusion between time of work and time of life, the old forms of blocking production are obsolete, if not impossible: the time of work is diffuse, not demarcated, and there is no factory as site of direct action”. This is the space of production that traditional trade unions are unable to organize as they have proceeded to become co-managers of the crisis and of the productive process within the boundaries of individual firms (as again in the German model). It is not by chance, maybe, that the only successful union struggles that have managed to achieve their goals have been those carried out by workers operating in the crucial sector of logistics. IKEA, Amazon and the Italian coop system have been hit by a wave of strikes organized by logistical workers who have been able to deploy the solidarity which emerges out of working physically together in the same space everyday with a successful reconstruction of the topology of the whole network of valorization. Maybe being aware of being part of the speculative logistical assembly-line of continuous performance improvement is an advantage in this configuration. Research discussed at the summer school about the strike of Amazon logistical workers in Germany have pointed out the importance of the “existential” dimension in triggering participation: the feeling of being a cog in the machine, of not having an input in the process constituted one of the factors which distinguished workers who joined the strike from those who didn’t.

As an answer to these challenges, Alberto De Nicola and Biagio Quadrocchi, have proposed to redeploy the tradition of “social unionism” as a way to ?connect the different experiences of struggle which, within and outside organized unions, oppose the blockage of social conlifct and the pacifying role of traditional forms of union? (De Nicola and Quattrocchi 2014). The effort goes into thinking of a common name able to account for the “proliferation of dispositifs of struggle” which are reconfiguring the form of the union pointing to the invention of a new “form of unionism”. As in the tradition of social unionism, the urgency is how to reconnect various experiences of struggles which have sedimented over the: the experiences of occupation of social spaces and houses, conflicts around a democratic reappropriation of welfare and the diffusion of new mutualisms and forms of organization of autonomous and precarious labor, demand a better connection. The use of the term ?social unionism? applied to practices which do not recognize themselves as such is meant to produce a new perspective able to connect these experiences. De Nicola and Quattrocchi deploy the term “social” in social unionism as a means to indicate the level of connection breaking through the dispositifs of “confinement” which have kept these experiences as separate instances.

The concept of “social unionism” has been rediscovered in militant milieus at the same time as its first practical implementation was deviced and launched: the ?social strike? called for by a network of activists who met for three days in Rome in September 2014 (Italians, but also French, Greek, German, Spain and Portugal) which is going to unfold through a series of events in view of the first official date of November the 15th 2014 (Strike Meeting 2014). The platform of the strike composes all the instances emerging out of the world of :work and education, of not-work and social cooperation”. The platform is crucially centered on the demands for a “new welfare” or “welfare of the common”: the right to housing, an income unlinked from waged work, a European minimum wage, free access to education, rejection of the subjection of the school and university system to the logic of the enterprise?. The notion of a *commonfare* which would not only guarantee a minimum income, but also able to refound the old institution of welfare around a process of co-production where services are no longer delivered but co-produced is crucial in the domains of health and education provision, but also housing, management of natural resources, and insurance. The social strike proposes to be a permanent experiment of invention and diffusion of forms of strikes that can be practiced also by those who cannot strike according to the traditional model: the unemployed, the precarious, the domestic worker, the crowdworker, the migrant without official documents. It thus aims to redeploy, reconnect and invent all forms of strike: ?the general strike of waged labor, the strategies of blockages and occupation experimented by precarious workers and urban dwellers, the strike of those who cannot strike, netstrikes, strikes within the spaces of education, the gender strike A kaleidoscope of practices to patiently construct through a series of territorial strike labs? (Strike Meeting 2014)

The social strike launched in September crucially includes the “digital strike” as one of its components. The importance of social networks in organizing, connecting and amplifying various struggles is undeniable, but with the years we have witnessed a growing awareness of the ways in which the social Internet has been reconfigured to become a space which operates according to a logic of security, working often in tandem with mainstream media to marginalize activists. During the BlockBCE event – which was also included in the series of events composing the social strike as permanent mobilization and which saw a rally of activists contesting the meeting of the European Central Bank in Naples, Italy – mainstream media and Facebook for example worked together to marginalize and contain the risk of contagion. This was not an intentional effect, wanted by and aimed for, as much as the result of a kind of automatic logic of security as it permeates both public discourse and communication technologies. The production of ?toxic narratives? and ?order words? by the media, the construction of activists as violent extremists, the action of police on the ground who pressured citizens and shopkeepers to close and keep indoors for the duration of the rally, are the first side of the double pincer attempting to block the generalization of the social strike, containing it as a kind of contagion. The second side of the pincer is the algorithmic calculation that reinforces and modulates the tendency of social networks to decompose into sub-networks, where most acts of communication fail to expand beyond a close numbers of related contacts and the diffuse sense of surveillance which as even corporate-funded research acknowledges produces a kind of new conformism on the Internet, a fear of ending up in the wrong database (Crawford 2014) . If the rally in Naples against the European Central Bank managed to break the siege that wanted activists to march alone in an empty city to perform a ritualized clash able to provide suitable images for the media by changing route and marching through the city, collecting solidarity and encouragement on the way, other strategies need to be deviced to break the circle that confines the social strike event within social network platforms.

The social strike launched in Rome in September has started experimenting with some strategies to break this process of marginalization on the Internet: the design of standardized but customizable images to be used as profile pics on social networks was one such level; the second was the twitter campaign launched on the 10th of october during the strike of students and of the school sector which pushed the hashtag #socialstrike to the rank of second highest trending topic. In the future, as part of the permanent laboratorial character of the social strike, new tactics could be experimented and redeployed: Anonymous-style Denial of Service Attacks, but also experimentation with hyper-popular forms of social network culture such as personality tests, games, viral links factories etc. The digital strike can thus become a new form of strike able to work synergetically with a long-term process of expansion and remodulation of strike tactics in a social unionism framework. The logic of social unionism, linking territorial labs and digital networks, posing together the establishment of long-term sites of elaboration of tactics and strategies, physical and digital action, carries the struggle of labor on that field of indistinction where work and life, digital and physical merge.”

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Posted in P2P Labor, P2P Movements, P2P Theory, Politics | No Comments »

P2P Theory: The War of Maneuver vs War of Position

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Michel Bauwens
19th October 2014


“Politics isn’t, first and foremost, a matter of making allegations and raising awareness; there is no one straw that breaks the camel’s back, and what’s bad can be tolerated indefinitely. Instead, it is a sort of shedding of the skin, by which we become sensitive to this or allergic to that. Nor has it much to do with convincing (discourse), or seducing (marketing), but rather with opening all sorts of spaces to experience another way of living, another definition of reality, another vision of the world. In the struggle for hegemony, the skin – yours, mine, everyone’s – is the battlefield.”

It seems to me that the p2p transition is mostly a ‘war of position’, see below for the explanation of Gramsci’s theory on this.

Excerpted from Amador Fernández-Savater:

“Gramsci enters the debate making a distinction between a “war of maneuver” and a “war of position”. The concept of class struggle as war, described in military strategy terms, was prevalent in the Marxism of the time. What’s more, Gramsci was writing from Mussolini’s prison, and continually obliged to come up with new metaphors to evade censorship. Paradoxically, his use of cryptic and elusive language, rather than classical Marxist vocabulary, made Gramsci’s work a thousand times more useful as a source of inspiration for future readers.

Okay, so, the key features of the “war of maneuver” are: speed, limited appeal, and frontal attack. Gramsci makes his arguments via Trotsky’s “permanent revolution”, George Sorels’ general strike, Rosa Luxembourg´s worker insurrection and, particularly, the Leninist power grab. These images of revolutionary change clash, time and again, with European and Western reality: the bloody repression of the Spartacist movement in Germany (1918), the disbanding of worker’s councils in Italy during the Bienno Rosso (1919-20), and so on. To avert a predictable sense of frustration and to keep actively aspiring to social change, we have to reimagine revolution.

Writing behind bars, Gramsci reflects that the war of maneuver can only succeed where society is relatively independent from the State, and civil society (ie., institutions interrelated with State power: justice, media, etc.) is basic and unstructured, as was the case in Russia. By contradiction, Western Europe’s civil society was extremely solid, and acted as an “entrenchment and fortification to protect social order. It seems as if economic catastrophe has decisively breached the enemy position, but this remains a superficial effect, for behind it lies an efficient line of defense”.

Gramsci critiques the “historical mysticism” (revolution as a miraculous enlightenment) and economic determinism (the supposition that economic collapse will trigger the revolutionary process) and posits a new strategy, an alternate image for social transformation: the “war of position”. The defining feature of the war of position is the affirmation and development of a new vision of the world. Each of our daily actions, according to Gramsci, holds an implicit vision (or philosophy) of the world. Revolution disseminates a new vision – along with other expressions – of the world that slowly leaks power away from the old vision to, finally, displace it. This process is described by Gramsci as the “construction of hegemony”. No power will last long without hegemony, without control of the expressions of everyday life. It’d be domination sans legitimacy, power reduced to pure repression and fear. The taking of power must, therefore, be preceded by a “taking” of civil society.”

Thus, the war of position, unlike the war of maneuver, is more an infiltration than an assault. A slow displacement, rather than an accumulation of forces. A collective and anonymous movement, rather than a minority and centralised operation. A form of indirect, everyday and diffuse pressure, rather than a concentrated and simultaneous insurrection (but, make no mistake, Gramsci doesn’t exclude insurrection at any stage, but subordinates it to the construction of hegemony). And, above all, based on the building and development of a new definition of reality. This, as explained in the words of the philosopher Cornelius Castoriadis as “what counts and what doesn’t count, what makes sense and what doesn’t, a definition not inscribed in books, but on the very being of things: the actions of human beings, their relations, their organization, their perception of what is, their affirmation and search for what counts, the materiality of the objects they produce, use and consume”.

Politics isn’t, first and foremost, a matter of making allegations and raising awareness; there is no one straw that breaks the camel’s back, and what’s bad can be tolerated indefinitely. Instead, it is a sort of shedding of the skin, by which we become sensitive to this or allergic to that. Nor has it much to do with convincing (discourse), or seducing (marketing), but rather with opening all sorts of spaces to experience another way of living, another definition of reality, another vision of the world. In the struggle for hegemony, the skin – yours, mine, everyone’s – is the battlefield.”

Two Examples: Christianity and the Enlightenment

To illustrate his argument for another idea of revolution, Gramsci offers two examples: Christianity and the Enlightenment. It’s quite curious: he utilizes a religious reform and an intellectual overhaul as models to conceptualise the political revolution he longs for. In both examples, the determining catalyst of change is a new definition of reality.

In the case of Christianity, it’s the idea that Christ has resurrected and there is life after death. Christianity coalesces around this “good news” that filters through every crack left behind by the old pagan world. The interesting feature is that the first Christians avoided power. Instead, their actions ultimately led power to come to them, as exemplified by the conversion of Emperor Constantine in the 4th Century A.D. The lesson of the first Christians would be: don’t fight directly for power, be the message-bearer of a new concept of the world, and, finally, the power shall fall (into your hands).

In the case of the Enlightenment, it’s the idea that all persons are of equal worth, as beings gifted with reason. The Enlightenment was the movement that spread this idea, in salons, clubs or encyclopediae. In the end, remarks Gramsci, once the French Revolution actually took place, it had already be won. Domination has no legitimacy because this new concept of the world has silently displaced the old, overtaking the powers of the Old Regime without them even noticing. The lesson from the Enlightened would be: the revolution is won before the revolution takes place, through the elaboration and expansion of a new image of the world.

These are the examples mentioned by Gramsci, who died in prison in 1937. But the 20th century has surely offered us other examples much closer to our own experience. Take, for example, the Gay Rights Movement. A movement both seen and unseen, formal and informal, political and cultural, that completely transforms the common perception regarding affective and sexual differences and goes on to effect legislative change. Or the Civil Rights Movement. Martin Luther King Jr. explained that the irresistible strength of the movement resided in overcoming the deeply internalised feelings of inferiority by confronting the opponents as equals (in civil disobedience campaigns, for example). An uprising in dignity that spurred modifications in the laws of the land.”

Translated by Stacco Troncoso, edited by Jane Loes Lipton

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Posted in P2P Theory, Politics | No Comments »

The three constituent elements of the Decentralized Computing Revolution

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Michel Bauwens
19th October 2014


Excerpted from Gary Sharma:

“There are three technologies that will form the foundation of the decentralized computing stack — mesh networks (decentralized networking), block chain (decentralized transactions) and autonomous agents (decentralized decision making).

* Mesh networks

The traditional network architecture of the Internet is vulnerable. There is risk of accidental damage or deliberate disruption (e.g. 70 million J.P. Morgan Chase accounts got hacked last week). We’re at the mercy and whims of telecom providers (e.g. the net neutrality debate). And there is a risk of corporations wielding too much power and governments tracking and spying on users (e.g. the NSA).

Over the last few days, hundreds of thousands of pro-democracy protesters have been thronging the streets of Hong Kong. Many of them have been turning to a new kind of app to message each other through a network that doesn’t require Wi-Fi nodes or cell towers. The app, FireChat by OpenGarden, got over 100,000 signups in 24 hours and is underpinned by something called mesh networks.

Mesh networks are peer-to-peer networks created by daisy-chaining your phone (which becomes a router) to nearby phones using Bluetooth and Wi-Fi. Everyone joining the mesh network creates an extension of the Internet. The more devices or nodes, the stronger it becomes. They cannot be controlled by any central organization. There is no single IP to block. And governments can’t shut them down. They are decentralized, self-healing and remarkably resilient.

Mesh networks started taking off with the proliferation of smartphones (no additional hardware is required) and the introduction of Multipeer Connectivity (iOS 7.0 and onwards) and Wi-Fi Peer-to-Peer (Android 4.0 onwards). They’ve since been used in protests in Taiwan, Iran and Iraq, the annual Burning Man Festival in Black Rock Desert and even in Red Hook, a remote neighborhood in Brooklyn that had no mobile phone or Internet access when Hurricane Sandy struck.

* Block chain

You’ve probably heard of Bitcoin, the global, decentralized crypto-currency, which incidentally has also become the largest supercomputing network in the world. But Bitcoin is really an app built on top of a revolutionary bit of technology called the block chain, the first practical solution to an age-old problem in computing, the Byzantine Generals Problem (establishing trust between unrelated parties over an untrusted network like the Internet).

The block chain is essentially a giant distributed cryptographic ledger shared amongst all nodes participating in the network, and keeps a record of every single successful transaction. This allows for trustless transactional activity. It facilitates ownership, storage, transfer and processing of information without the need for a middleman or identity information clearinghouse.

What this really means is that transactions, identity verification, trust, reputation and payments become quantifiable and programmable.

And it opens up a whole range of possibilities:

Decentralized voting (e.g. Agora), where voters pay using a crypto-currency into an account representing their choice, with the winning candidate being one with highest balance.

Decentralized Domain Name Registration (DNS) (e.g. Namecoin) would be based on a crypto-currency model, and operate independently of ICANN (so technically immune from Internet censorship). Namecoin uses the .bit top-level domain.

Decentralized storage (e.g. Maidsafe and Storj), where trustless nodes would work together (using crypto-currencies as means of payment) to exchange storage space and bandwidth.

Smart self-validating contracts for real-time revenue sharing (e.g. Secure Asset Exchange); helping artists secure and verify their digital artwork by logging it in the block chain (e.g. Monegraph); and even decentralized Twitter-like P2P asynchronous messaging platforms (e.g. BitMessage and Twister).

Document certification (e.g. Proof of Existence) is a clever use of the block chain as a publicly visible and authenticated timestamp.

In fact, asset registries/keys that could theoretically be implemented in a block chain model are endless — land titles, private equities, mortgages, vehicle registries, passports, birth certificates, voter ids, gun permits, wills, escrows, degrees, car keys, house keys, patents, trademarks, coupons, genome data and even nuclear launch codes!

Companies like Ethereum and BitShares are now building their own, new block chains, platform and programming language to help developers build next-gen decentralized apps.

And just last week, a couple at Disney World had the first block chain marriage, recorded forever within the block chain!

* Autonomous agents

These are entities that make their own choices regarding how to act in their environment without influence of a central authority.

With decentralization, autonomous agents will play an increasingly important role in how things get done. They will be the brains and logic residing inside everything from driverless cars to delivery drones, from your bank accounts to your thermostats. They will operate individually or in a swarm. They will buy and sell services using crypto-currencies, pay their own costs to maintain and upgrade themselves and even replicate as they become profitable. They will be self-sustaining economic units — almost like mini-corporations, but without the bureaucracy.

Of course, as the decentralized computing revolution spreads, there will be legal, technical and social challenges.

Anonymity, a key component of the system, could encourage illegal activities. With rise of autonomous agents, questions regarding liability and accountability will be raised. And we have to be careful we don’t exchange the tyranny of gatekeepers for the tyranny of code.

But the transition to a global system that is decentralized, distributed, anonymous, efficient, secure, permission-less, trustless, resilient, frictionless, almost free, with no single point of control and no single point of failure… seems inevitable.”

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Posted in P2P Infrastructures, P2P Technology | No Comments »

Can the decentralization of power in public services prevent the market failures of privatization ?

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Michel Bauwens
18th October 2014


Excerpted / republished from Maria Felicita Ferraro:

“When the neo-liberal approach of “marketisation” began to spread, it was rooted on a particular critique of state-run services. They were indeed perceived as top-down, inefficient and out of touch with people’s needs, knowledge and preferences. The public service agenda of the following governments has more often than not been based on market competition and consumer choice, with the aims of reaching lower costs, increasing quality and respond better to consumers’ preferences.

As rightful as all of these aims sound, though, it doesn’t seem like they have been reached. Public services often leave very little power to citizens, in favor of experts and politicians. What did we expect, though? Competition tends to lead to fragmentation and opposition between stakeholders, it discourages partnerships and it induces private companies to prioritise shareholder-return, which contrasts with public policy priorities such as meeting social needs. And while competition has been negative on the public sector, an alternative model of commissioning would allow for a collaborative partnership between different publicly oriented institutions.

The New Economic Foundation (NEF) has hence recently argued that public services should be delivered democratically and with the help of other not-for-profit community and civil society groups. It proposed a top-down approach that could bring more power to citizens thanks to a series of steps:

The first is co-production among experts and citizens who are recipients of a service, in order to combine their knowledge.

Then there is participatory democracy, that allows service users more control over decisions, over public spending (through participaroty budgeting) and even over political decisions (an example is Iceland, who recently tried to “crowdsource” its new constitution).

One more measure to shift power is the reformation of public agencies so that they resemble the model of cooperative governance structures, by granting less hierarchical working cultures that ensure more autonomy and trust to their staff, as Newcastle has succesfully demonstrated.

Indeed, there already are positive outcomes coming from the implementation of this approach: some public agencies, across the UK and beyond, are already enjoying the benefits of co-production, seeing services designed and delivered through an equal partnership between professionals and service users.:

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Should we remain cognitive slaves ?

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Michel Bauwens
15th October 2014


An older piece from John Robb, still very relevant:

“The companies that have created the most new value in the last decade, are Internet companies like Facebook, Google, etc. They’ve created hundreds of billions in market value, driven by billions in financial profits. Good for them, but bad for us.

Why? IF these companies represent the most valuable new industry of the early 21st Century, where are the jobs that will provide prosperity for millions today, and potentially tens of millions in the future? They don’t exist. These companies create few real jobs.

The distressing part is that in reality these companies actually employ hundreds of millions of people, particularly young and otherwise un or underemployed superusers. People that work for them day in and day out for free: finding, sifting, sorting, connecting, building, etc.

Let’s take Facebook as an example. Currently it’s valued at ~$25 billion by the market. However, it could be argued that ~100,000 superusers out of 500 million part time users, are the reason that Facebook is valuable. They generate the core network that is the backbone of the tool. Their devoted use, high levels of connectivity, and loyalty forms the engine that grows Facebook, year in and year out. They are the materials, labor, and product of Facebook’s assembly line. Yet they aren’t paid for their effort. They aren’t generating wealth for themselves or their families.

How much wealth? If we awarded 4/5 ths of the value of Facebook (and the same exercise could be done with Google at a couple of million superusers) to its superusers, leaving the tool managers $5 billion in value, each superuser would now be worth $200,000 from their contributions to this tool alone. But they aren’t. They haven’t earned a penny for their effort.

One way to look at this is that we are truly in trouble. If the industries of the future are based on cognitive slavery, we all lose. However, as an entrepreneur, an optimist (believe it or not), and a believer in the potential for social/economic improvement, I think this can be corrected. I believe it’s possible to build tools and the companies that manage them, in a way that actually rewards the people that do most of the work. All we need to do is make it possible.”

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Can capitalist management reform itself from within ?

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Michel Bauwens
13th October 2014


“As Caulkin notes in the Financial Times, “the invisible link between sluggish innovation, cost-cutting, share buybacks, the jobs and pay squeeze, and neo-Taylorism, is management incentives. What locks them all together in a tight, self-reinforcing paradigm is shareholder value–the assertion that the sole purpose of the company is to maximize returns to shareholders.” If this is correct, the principal question for the Drucker Forum is whether we will be able to agree on severing this invisible link. Will the Forum accept that this is the critical link that needs to be broken?”

Excerpted from Steve Denning:

“In the context of the emerging movements to reform the management of big corporations today, … thought leaders allude to the possibility of a Reformation in management, and indeed of the entire system of capitalism in which managers operate. Thus in June 2014, Clayton Christensen and Derek van Bever wrote in the June 2014 issue of Harvard Business Review (HBR). “The orthodoxies governing finance are so entrenched that we almost need a modern-day Martin Luther to articulate the need for change.”

Christensen and van Bever are not alone in calling for some kind of Reformation. At the conclusion of this article, I list a number of the articles that have appeared over the past few months in leading pro-business journals such as Harvard Business Review, The Economist, Financial Times, The New York Times, the Wall Street Journal, the Washington Post and Forbes.com, all denouncing key management practices and calling for major change. So are we reaching a turning point in management, and indeed in capitalism as a whole, analogous to the religious Reformation five centuries ago?

Many of the world’s thought leaders will converge on Vienna Austria on November 13-14, 2014 to discuss this very question at the Global Peter Drucker Forum 2014. The speakers include Clayton Christensen, Gary Hamel and Roger Martin, among many others. “We have arrived at a turning point,” says the Forum’s abstract. “Either the world will embark on a route towards long-term growth and prosperity, or we will manage our way to economic decline.”

The question is whether the Drucker Forum in November will be able to reach agreement on the way forward and generate an united front for reform, or whether it will, as at the Colloquy of Marburg in 1529, splinter into different factions, as thought leaders emphasize their own particular slant on the issues, with the obvious common ground among them being lost in the din of heated debate on tiny doctrinal issues.

Why the current calls for reform are significant

A number of aspects are significant for assessing the current calls for reform.

First, these calls don’t come from a bunch of protesters camping in a park. They come from the most distinguished pro-business voices in the world—the heavy artillery of capitalism itself.

Second, it isn’t just one or two voices. The critiques and the calls for change are many and simultaneous. Big-gun broadsides are coming all at once.

Third, these thought leaders are not speaking in euphemisms or hedging their bets. These are flat-out denunciations of, not just one firm, but the whole management culture that prevails in big business. Phrases like “stock price manipulation” (HBR), “corporate cocaine” (The Economist) and “zombie managers in the grip of management ideas that refuse to die” (Financial Times) are typical.

Fourth, we now see incumbent members of the C-suite speaking out, such as Tim Cook at Apple [AAPL], Paul Polman at Unilever [UN], Xavier Huillard at the Vinci Group and John Mackey at Whole Foods [WFM]. These corporate leaders are speaking out while they are still in office, as compared to Jack Welch, who called shareholder primacy “the dumbest idea in the world,” long after he had retired. An even larger number of corporate leaders at firms like Gore, Google [GOOG], Amazon [AMZN], Linux, and Morning Star and many small organizations are actually practicing a more creative brand of management, even if they don’t always go around making speeches about capitalism.

Fifth, although there are different terms in use and different emphases, the common ground among the voices for change is more striking than the differences.

Finally, these thought leaders make a powerful case that the economic and social costs of current management practices are so grievous that in any event they are not sustainable. As Roger Martin argues in his article in the October issue of HBR on “The Rise and (Likely) Fall of the Talent Economy,” change will happen, one way or another. The only question is whether the transition is going to be quick and intelligent and elegant, or slow and ugly and even violent—like the religious Reformation— and take more than a century.”

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P2P Theory: What’s the right approach to the state in the p2p transformation ?

photo of Michel Bauwens

Michel Bauwens
12th October 2014


A contribution by Theodoros Karyotis:

“The “state” in the thought of many political thinkers (Castoriadis preeminently, but also Bookchin, Holloway etc) is not just a generic term for a structure of large scale governance. On the contrary, it signifies a model of governance where power does not reside in the intended political community, but in a separate political class that exercises it on society from above. This can be by divine right (theocratic state), brute force (dictatorship) or ritualistic electoral appointment (western-style democracy). In all cases, with more or less individual liberties, with more or less (manufactured) consensus, a state perpetuates the domination of a class over another, since power is removed from the subjects it governs.

Now I don’t think that anyone (apart from some obsolete 19th century theorists) can argue that the reproduction of the full complexity of social life can be ensured by an arrangement of disconnected and dispersed horizontal structures. We urgently need a scheme of governance built from the bottom up, not representing the interests of the people (as the left wing parties would have it) but including these very people in the power structures, from the local to the global, in a way that avoids power concentration, ensures economic equality and promotes education in political participation for all.

So if we agree that state and governance are two different concepts, we are all on the same page, and Michel´s vision of “transformed and democratic state, modelled on the greek democratic cities” would be an ideal we all share -only since power would be immanent to society and not removed from it, it wouldn’t be called a state anymore. I hope you understand this is not nit-picking.

Now I think we can all agree on the necessity of this -the real issue is how we get there. The two roads that have been proposed is a) the “radical restructuring” (to use Restakis’ term) of the existing state institutions in order to make them more inclusive and decentralise power and b) the creation of institutions antagonistic to the status quo built from the bottom up that will compete with the state for legitimacy and efficiency (and would have to eventually confront the state).

A new and exciting example of road a) is Podemos party in Spain (SYRIZA is a similar case, but not as exciting anymore). A successful and well-documented example of road b) is the Zapatista autonomy in Mexico.

Now obviously there are many disadvantages to the path of autonomy, first and foremost that the existing power (class-gender-ethnicity-you name it) structures are deeply ingrained in peoples’ consciousness, and even if we educate ourselves to overcome them, the powers that be will not allow the creation of competing power institutions, legitimized as they may be in the eyes of society. And of course it will be a long process before this autonomous power structure can take over all the functions that are important for our reproduction, which are now managed by the state. (We would definitely need to create collective instruments of accumulation and distribution of surpluses in order to build the bridges David Harvey speaks about -that is the subject for another discussion). So the time scale and effort required by the path of autonomy seems intimidating.

So why go the hard way, and not take a), the easy way there? Simply because historical experience shows that when you try to reform the state, you end up being reformed by it. SYRIZA in Greece is a good example of this: It started as off as a small radical left coalition with an ambitious reform plan, and in order to come closer to power it had to revise its reform program, appease the media and the powers that be and move itself towards the space previously occupied by social democracy. By the time it reaches power (if it is finally allowed to govern) there will be nothing new and ambitious in its reform program anymore, and the party will have to make do with a moderate plan of saving the middle classes from total annihilation by stimulating growth and creating jobs – the exact opposite of really creating an alternative to capitalism. The reason is simple: Capturing state power is not enough to capture real power. So when you set out to capture state power you end up captured by state power.

Here is an article I co-wrote recently that goes a bit more into depth on that issue:
http://roarmag.org/2014/09/syriza-government-autonomous-movements/

We have more historical precedents: Half of Latin America is governed by governments that started out as “progressive” and are now becoming more aggressively neoliberal that their predecessors. Ecuador, despite the interesting FLOK program, has one of the most aggressive extractivist policies in Latin America, and several hundred indigenous leaders are in prison accused of terrorism, simply for having stood up to protect their commons. In Bolivia there is also extreme criminalization of the social movements, and the government is pushing forward aggressive neoliberal projects such as the TIPNIS highway. Shall we talk about Brazil? The only interesting experiment in “dual power” is Venezuela, but there they also have the boon and curse of extractivism in the form of fossil fuels: Displaced populations, destroyed environment. As idealistic as the path of autonomy may seem, I think that it is more feasible than teaching -even through perfectly well-meaning and well-thought-out programs such as the FLOK- the language of commons and participation to these post-colonial behemoths that have been speaking for centuries the language of plunder, exclusion and genocide.

So I am not trying to condemn all attempts at reforming or radically restructuring existing institutions, but I think our time and energy is best spent on strengthening our bottom-up powers and building our parallel institutions that speak the language of the commons, of equality and participation. At the same time we can keep using strategically the existing institutions, but with a confrontational and transcendental mindset.

A very inspirational project that sums up what I am advocating is the Cooperativa Integral Catalana (http://cooperativa.cat/en/), a large-scale experiment in self-sufficiency and autonomy in Catalonia. They implement commons-based and needs-driven economic instruments, trying to integrate as many aspects of socio-economico-political life within the scope of the project, thus leaving gradually less and less of their lives in the hands of the state and the market. At the same time they are using loopholes in the existing legislation to fortify their projects, while promoting active political and economic disobedience. So when I speak about autonomy, I don’t mean that we should act as if we are in a political and social vacuum, as if there were no constraints on our political becoming. Instead I think that we should preserve our radical independence from existing power structures, while using them strategically to trace a path within, against and beyond the state and the market. A similar strategic use of existing institutions would be the experiments in libertarian communitarianism, where local government is seen as an accessible and meaningful locus of power to contend -with municipal power being the stepping stone rather than the horizon of political action.”

Source: The networked labour mailing list, October 2014

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P2P Theory: The becoming-rent of profit

photo of Michel Bauwens

Michel Bauwens
11th October 2014


Excerpted from an article on the spectrum commons by Rachel O’Dwyer:

The communism of capital is characterised by a return and proliferation of forms of rent (Vercellone, 2010). Rent is the revenue that can be extracted from exclusive ownership of a resource, where value is contingent on its availability with respect to demand (Harvey, 2001). Industrial capitalism concerned direct intervention in the production process, and subsequently in the generation of profit. In industrial capitalism, therefore, rent is characterised as external to production and distinct from profit. Industrial capitalism constituted a shifting emphasis from immobile to movable property, corresponding to a shift from primitive accumulation towards profit. Rent was largely understood as a pre-capitalist legacy, traditionally associated with immobile forms of property such as land. Where ‘rent’ is the primary locus of value, the rentier is thought to be external to the production of value, merely extracting the economic rent produced by other means. The generation of profit, in contrast, requires the direct intervention of the capitalist in the production and circulation of material commodities. It is associated with the ability to generate and extract surplus (Vercellone, 2008, 2010). This transformation from rent to profit, many theorists argue, is emblematic of a passage from primitive accumulation to capitalist productive power in industrial capitalism (Hardt, 2010). In contrast, capitalist accumulation is today characterised by a shift from the productive forms of capitalism that characterised the industrial era towards new modalities in which rent is no longer cast in opposition to profit. Through the growing role of property in extracting value from a position external to production, and the manipulation of the social and political environment in which economic activities occur, such as the management of scarcity and the increasingly speculative nature of capital itself, the core tenets of ‘rent’ are confused with ‘profit’. This is described in the Post-Operaismo theory of the ‘becoming-rent of profit’, an economic theory specular to the communism of capital.

Rent, as Pasquinelli (2008) maintains, is the flipside of the commons. Through the rent applied over proprietary frameworks that flank the digital commons, the material surplus of immaterial labour is opened to extraction. Spectrum, in this case, like a monopoly over knowledge, decision engines, storage or processing capacities, provides the owner of that informational resource with the opportunity to leverage this property in order to extract value from a position external to its production. Where wireless transmissions are concerned, underpinning this process is the reification and subsequent rarefaction of radio signals – the commodification of electromagnetic transmissions followed by progressive arguments for the necessity of institutional regulation, first through state bodies, and later, increasingly through enterprise.

* The becoming-rent of profit: Enclosure

Enclosure of the digital commons operates through the dual processes of dispossession and deregulation of these architectures (Dyer-Witheford, 1999; Hardt and Negri, 2009). To secure cooperation, capital must first appropriate the communicative capacities of the labour force. Common tools are appropriated and filtered through administrative channels, at which point they are once again distributed as part of the services capital must deliver to the labour force in order to ensure its ongoing development. But how does enclosure operate over something as intangible as electromagnetic spectrum? Throughout the history of radio communications, a variety of apparatuses that perform this enclosure can be identified, at turns semantic, technical and juridical.

* The becoming-rent of profit: The production of scarcity

Beyond the enclosure of the commons, the survival of exchange value is increasingly contingent on the destruction of non-renewable scarce resources and/or the creation of an artificial scarcity where these goods are by nature non-rival and reproducible. Enclosure and scarcity go hand in hand; there is no chronology as such. The extraction of rent is dynamic and these elements, which are separated for clarity in this paper, are in reality entangled, imbricated and mutually enforcing.

According to Vercellone (2010), resources on which rentier appropriation is based today do not tend to increase with rent; indeed they do exactly the opposite. To quote Napoleoni’s (1956) definition, rent is ‘the revenue that the owner of certain goods receives as a consequence of the fact that these goods, are, or become, available in scarce quantities’ (quoted in Vercellone, 2010: 95). Rent is thus linked to the artificial scarcity of a resource, and to a logic of rarefaction, as in the case of monopolies. Rent, therefore, leverages monopolistic or oligopolistic forms of property, and positions of political power that facilitate the manufacture of scarcity. Scarcity in the digital commons is induced by a variety of juridical artefacts such as intellectual property or digital rights management in the case of digital content, and through a combination of rhetorical devices and technological or juridical regulations in the case of electromagnetic spectrum.”

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Can the Lower Energy Consumption of Distributed Manufactured Goods help the environment?

photo of Michel Bauwens

Michel Bauwens
10th October 2014


Yes:, via Tessel Renzenbrink:

“A study from Michigan Technology University shows 3D printed products require 41% to 74% less energy than large-scale manufactured goods.

Since the First Industrial Revolution manufacturing has gone through stages of increasing centralization. But with the emergence of affordable open source 3D printers the pendulum may swing back to decentralized home-based production.

Megan Kreiger and Joshua M. Pearce of Michigan Technology University did a comparative study [PDF] of energy demand and greenhouse gas emissions of centralized and distributed manufactured goods. The scope of the study is small plastic products because they are perfectly suited for 3D printed home production.

Currently, plastics are mostly mass-manufactured in low-cost labor countries and shipped across the globe. In terms of energy consumption, home-based 3D printing has the obvious advantage of avoiding international transportation costs. Another important factor is the improved material efficiency of additive manufacturing.

The conventional method to create plastic components is to inject heated thermoplastics into a mold. Injection molding leaves little room for material manipulation, the parts are always solid plastic. Kreiger and Pearce found that for most 3D prints a fill percentage of 25% or less was enough to maintain the structural integrity of the product. Moreover, 3D printing allows for creating complex forms in a single session such as moving parts and hollow structures, saving energy on drilling and assembly machinery.

To compare distributed and conventional manufacturing Kreiger and Pearce, did a Life Cycle Analysis of three products: a citrus juicer, a children’s building block and a water spout. For each product they calculated the total Cumulative Energy Demand from cradle-to-gate. The conventional LCA includes raw material extraction in the country of production, mass-production and international transportation to a warehouse in the US. The distributed LCA includes raw material extraction in the US, domestic transportation and home-based production.
The researchers also experimented with solar powered 3D printers. Here they achieved the best result, saving 74% energy compared to conventional manufacturing. For non-renewable sourced electricity the best result was 64%.”

No, from Melba Kurman, and Hod Lipson:

“The reality today is that the technology is not there yet. Despite the potential of additive manufacturing to promote cleaner manufacturing, 3D-printing technologies aren’t yet eco-friendly. A 3D printer — no matter what sort of raw material it’s working with — is an energy hog.

Research at Loughborough University in the United Kingdom (in a study called the Atkins Project) revealed that the 3D-printing process consumes a frightening amount of electrical energy. Researchers compared industrial-grade printers to injection molding machines. They learned that 3D printers that use heat or a laser to melt plastic consumed an estimated 50 to 100 times more electrical energy than injection molding to make an object of the same weight.

A scourge of plastics: Energy consumption during the manufacturing process aside, another not-so-ideal environmental impact of 3D printed manufacturing is its heavy reliance on plastics. Plastic is rarely good news when it comes to the environment, regardless of what sort of manufacturing technique is involved. However, odd as it may sound, injection molding (the traditional method used to manufacture plastic objects) is actually quite clean in that it leaves behind very few unused plastic pieces.

In contrast, industrial-grade-plastic 3D printers that use powdered or molten polymers leave behind a substantial amount of unused raw material in the print bed. Plastic byproduct left behind in a print job can sometimes be reused, but more typically, its material properties are corrupted and therefore no longer suitable. A glimmer of hope is offered by a corn-based printing plastic called PLA that’s biodegradable (although its biodegrading process takes many years).

Secondhand fumes: It took years to prove that secondhand smoke was hazardous for your health. Recent groundbreaking research led by Brent Stephens suggests that secondhand printing fumes contain toxic byproducts given off when plastic is heated to high temperatures. For years, printing aficionados have remarked on the fact that certain 3D-printing plastics give off a nice, cozy smell, similar to burning corn kernels. To see whether the burning plastic smell was harmful to living things, Steele measured the air quality inside an air-conditioned office where five desktop 3D printers fabricated small plastic objects (using both ABS and PLA plastics) over the course of two and a half hours.

Air quality analysis revealed that 3D printers could be characterized as “high emitters” of what are known as “ultra fine particles,” or UFPs. According to a report from the Heath Effects Institute (HFI), in animal and human studies, observed effects of UFPs included “lung function changes, airway inflammation, enhanced allergic responses, vascular thrombogenic effects, altered endothelial function, altered heart rate and heart rate variability, accelerated atherosclerosis, and increased markers of brain inflammation.”The good news about the UFPs emitted by the few 3D printers in Steele’s study was their levels were about the same as cooking indoors. The bad news is that more research is needed on what UFPs, exactly, are emitted by home-scale plastic printers and the impact of UFP emissions in industrial-scale 3D printing environments. In the shorter term, it might be wise to not let your child leave the printer running overnight in her bedroom. And if you’re printing plastic at home or in your office, open a window and use a fan to keep the air fresh.

3D printing might someday encourage a new kind of pollution: rapid garbage generation. Engineers being trained to respect their raw materials are taught “Think twice, cut once.” When people get ahold of easy production tools, however, it’s easy to not heed that wise old adage. Like printing draft after draft of a term paper during its painful revision process, designers and tinkerers might find themselves rapidly printing out a series of incremental variations of a design, an environmentally costly process.

To unleash 3D printing’s potential as a greener manufacturing technology, the key will be to create unique, greener product life cycles. Perhaps one of 3D printing’s most promising environmental benefits will be the fact that computer-generated designs help improve a product’s form, function, performance and durability. For example, a 3D- printed metal airplane made of computer-designed, lightweight parts would consume less fuel during its lifetime of use.

3D-printed manufacturing could also change the product life cycle by shortening global supply chains, reducing the amount of fuel that’s consumed to ship products from place to place. On-the-spot 3D-printed manufacturing would also reduce the environmental costs of maintaining a climate-controlled warehouse to store inventory. Your family doctor could print out a custom hearing aid for you when you need it. Your local car mechanic could print out new parts for your car without having to order them from a supplier far, far away.

Renewable energy is key to greener manufacturing. However, most renewable energy sources today can’t yet provide (at a reasonable price) the incessant, reliable stream of power needed to fuel mass-manufacturing operations.
What if small bursts of renewable energy could be applied to small bursts of manufacturing activity? Computer scientists call the transmission of electrical signals of vastly differing sizes “bursty communication.” Why not a future in which “bursty energy” would be applied to “bursty 3D-printed manufacturing?”

Despite improvements in storage technologies and smart-energy grids, renewable energy may always be more prone to fits and starts than burning gas or coal. However, a 3D printer is a versatile beast and can turn on a dime, production-wise. A small manufacturing facility of the future could run several 3D printers, each making a wide variety of different products. This facility could be powered with set amounts of stored renewable energy that would fuel scheduled start-and-stop 3D-printed production runs. Someday, it would be great to see agile 3D-printing facilities that would rapidly adjust fabrication rates to the level of available renewable power, instead of the other way around.

As Earth staggers under the weight of pollution, humanity needs to better balance the health of the environment against a global consumer economy that grows larger each year. Despite its promise as a manufacturing technology, there’s nothing innately green about 3D printing.”

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