Phyles: Economic Democracy in the Network Century. by David de Ugarte

Introduction by the author:

“This work is the last instalment in a series of books, written by half a dozen authors besides me, that try to describe and understand, from a common logic although from different angles, the vast social changes which took place in the wake of the fall of the Berlin Wall. In the last twenty years, we have seen how the division of the world into two great blocs gave way to globalisation, while the emergence of the Internet produced a deep change in the fundamental structures of power, always dependent on the management and social control of information.

This substantial change converged and merged with a new paradigm of conflict as apparently distributed and ungraspable. This new expression of an emerging world cohering around distributed networks (the web, the blogosphere, SMS networks) became apparent in its civic dimension when, all over the democratic world, waves of cyberthrongs influenced political processes which had apparently been under the full control of the powers that be: from the fall of Estrada in Manila in 2002 to the Athens riots in 2008, through the 2004 13M in Madrid and the 2005 French swarming. This was a distributed paradigm which, on the other hand, could be glimpsed in conflicts since the 90’s, and which was given a label with the advent of al-Qaeda: what are known as the post-modern wars.

In less than two decades, the whole world started to inculturate a fundamental change in the shape of the great social network. The idea of belonging was changing. The cohesive, explanatory power of nationality was shrinking. Nations were starting to become both too small and too large to explain who we are. The mass experience of virtual socialisation, de-territorialised but personal, as well as the changes in the economic system leading, in the face of the onslaught of networks and globalisation, to what Juan Urrutia has called the coming capitalism, opened a period characterised by the search for identity, by identitarian experimentation.

We are in the process of going from a world of decentralised networks to a world of distributed networks. This is evidenced in communication as a crisis in the information systems of agencies and newspapers; in the cultural sphere as a crisis in the current industrial model for films, books, and music; in democracy as citizens’ cyberthrongs; and in war as a new paradigm. This shift leads us to a new paradigm, seen in the complex world of collective identities in the increasingly important role of a new kind of community, communities which are closer to the old real, contiguity-based communities than to the great nationalistic imaginaries of Modernity. We are experiencing, in that area, another shift, one taking us from nations to networks.

Studying this latter dimension, the changes in the identity patterns of our time, we discover a new kind of socio-economic organisation: the phyle. The phyle is much more than a kind of business; it has, among its main features, all the elements that articulate our time – it is born from the experience of socialisation in virtual communities, it is transnational, and it vindicates new forms of economic democracy which, in turn, link it to traditional cooperativism.

Even more interesting: we find how organisations as distant from the hacker world as some of the largest Sufi brotherhoods in Senegal, scourged by immigration and the impact of distributed communications, plunged into a crisis and developed new, identity-based forms of commercial networks, which brought them closer and closer to phyles.

The study of phyles is not, at least today, the study of a mass phenomenon, nor is it leaping onto the bandwagon of an uncertain prophecy of social reform. It is the discovery, through the experience of a budding world, of the limitations of economic democracy and its forms. It is not at all a question of discarding the traditions and values of cooperativism. For a century and half, cooperativism has been living proof that, even under industrialism, it is possible to organise production differently, making people its centre. But the distributed network society can go even farther. Among other things, because the incentives it is based on in order to innovate and generate cohesion are different from those in industrial society.

In this book, we will discover how, paradoxically, the first phyle replicates forms whose origins lie in the first trade revolution, which took place in the Mediterranean between the 10th and 12th centuries, during the apogee of the Sea Republics and the great trade networks that linked the Muslim and Christian worlds. We will discover how much the new forms of democratic business organisation, which distinguish between community and demos, owe to medieval guilds. And above all we will see how the concepts of equality and fraternity are redefined and permeate the production and trade space creating a new kind of collective identity which takes personal freedom as its basic structural criterion.

The new world, which we are all exploring every day, sends us many signs of social and economic decomposition. This is not exactly an idyllic world. However, it still is an open world where the only path that is closed is turning back. The study of phyles is a bet on all that is cohesive and democratic in the new world of networks: a bet because the models on which we shall build our future will not be overly contradictory of those which still have a libertarian optimism about progress.”