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The use of cult techniques by sharing economy brands and platforms

photo of Michel Bauwens

Michel Bauwens
15th August 2014

When marketing executives at “values-led” companies try to cultivate communities around ethical consumerism, it creates a new class of problems. Much like religious cults, cult brands manipulate their customers’ emotional and psychological needs and encourage them to construct their identities and lives around the brand. The collapse of the ideal would be felt as a personal catastrophe for its community, so the brand becomes practically immune to criticism.

Excerpted from a long and stimulating essay by “Mr. Teacup”.

A must-read for all sharing economy advocates with crucial background information on the creation of the Peers advocacy organisation:

“What role does marketing play in the construction of communities around a business? For a new breed of advertisers like Chuck Brymer, CEO of leading agency DDB Worldwide, the answer is a great deal. Brymer believes that with the rise of the internet, advertising is moving away from the traditional propaganda model of influenced rooted in broadcast media, and becoming a dialogue with consumers and among consumers. Generating buzz, facilitating interactions among consumers, reaching influencers and turning them into brand ambassadors becomes key to successful marketing. Their Twitter bio says it all: “Connecting people with people, not just people with brands.“ In the end, says Brymer, the Chief Marketing Officer role will evolve into Chief Community Officer.

Aligning with this philosophy is a book published in 2004 titled The Culting of Brands: Turn Your Customers Into True Believers. It was written by a former advertising executive who studied how real cults recruit and maintain members hoping to teach the tricks to marketers to inspire the same kind of fierce loyalty, religious devotion and vibrant community around their brands. The book is a manual for achieving corporate goals by exploiting consumers’ emotions and need for belonging, meaning and purpose.

It achieved only modest reach, but the book is important to understanding sharing economy marketing strategies because the author is Douglas Atkin. Since 2013, Atkin has been Global Head of Community and Mobilization at Airbnb, and Co-Founder and Board Chairman at Peers. Already in 2009, Atkin began to apply his cult-branding techniques to the political problems facing his clients, co-founding Purpose, a consultancy which uses the viral tools of digital marketing to launch social and political movements on behalf of paying clients.

If we want to understand the ideas and strategy behind Airbnb’s and Peers’ marketing, there’s no better place to start than by reading the book written by the mastermind behind it all. And it is vital that we do understand it, because Atkin’s method is a dangerous new tool that can be used by elites to undermine democracy and manufacture public support for their interests.
The book begins in a defense posture. Atkin, well aware that his premise is highly contentious and potentially unethical, asks “Aren’t cults manipulative, evil organizations intent on exploiting the gullible? Should they be a source of insight for commercial gain?”

His book aims to show that brands satisfy important human desires in the same way that cults and religions do, meeting needs of belonging, making meaning and making sense of the world. But he sidesteps the ethical question in troubling ways. His position is that cults are a good thing. They’re normal and people join for good reasons, and that we should suspend our prejudice. The popular stereotype of cults as manipulative, dangerous and even suicidal is true to a certain extent, says Atkin, but that’s only because only the dangerous ones get all the press. All religions began as cults, and contrary to popular belief, most cult members are normal, psychologically healthy, intelligent well-educated and socially adjusted individuals.

This is the full extent of Atkin’s confrontation with the ethics of applying cult techniques, breezing past the most troubling aspects of the thesis in less than two pages. His point, such that it is, is well-taken. Mainstream society unfairly stigmatizes former and current cult members, treating them as damaged goods. But the truth of this insight obscures a subtle deflection of our concerns about cults. We worry about authoritarian tendencies, manipulation and exploitation by the cult leader, his ability to persuade his members to act against their best interests. Atkin reframes this as a prejudice against cult members, waving away legitimate ethical concerns as if they are all simply narrow-mindedness about how unorthodox people choose to live their lives.

We don’t need to claim that all cults are bad to ask if it is wise to use them as a model for corporate marketing. Cults may be harmless in many cases, but when they aren’t, the results can be catastrophic. They seem to be uniquely vulnerable to corrupt and exploitative people who put themselves in leadership positions.

Atkin is fascinated by why people join cults and what inspires their intense loyalty. “Why do they throw time, money, sometimes their careers, the regard of their peers, and even their families on the cult of belonging?” He interviews a fanatical Apple fan who often couldn’t afford lunch but always upgraded to their latest computer model because he wanted to support the company.

In the popular imagination, cult members are believed to be mindless conformists, but Atkins says nothing could be further from the truth. The real key to creating a cult (and a cult brand) begins with individuals who feel a sense of alienation. The feeling that they don’t fit in with society leads them to seek alternatives, a place that they can truly call home, until they stumble upon a welcoming group that understands them, supports them and celebrates their difference instead of rejecting it. This sets the stage for the cult member’s self-actualization. Interviewing cult members and brand devotees alike, Atkin found they express the same feeling of becoming more coherent and whole as individuals, true to who they really are and more in touch with themselves.

Cults will flatter you. They will make you feel special and individual in a way that you are unlikely to have felt before. They will celebrate the very things that make you feel different from everyone else; the members will get to know you deep down, and they will love you for what they find you. And you will love them.

So the key to attracting cult-like devotion is healing potential recruits’ sense of alienation. Although cults are often perceived to be taking from their members while giving little in return, cult members do receive something of value from the cult, meeting some of their deepest desires to become their authentic selves.

Having determined what motivates cult members, Atkin delivers a strategy for brand managers. To attract people who feel different, cult brands also have to be different. It’s a four step process.

First, determine your brand’s sense of difference. The motorcycle brand Harley Davidson cultivates an image of individualism, rebelliousness, adventure and a willingness to throw off the constraints of conventional suburban life. The brand’s official guidelines state: “Harley Truth#1: Harley is not for everyone.”

Second, declare your difference, the belief system that set you apart. “Framing a clear system of ideas that depart from cultural norms provides the sharpest delineation between the organization and the rest of the world. And it provides a beacon for the disenfranchised,” says Atkin. At the same time, cult members must feel a sense of ownership over the ideology, it can’t just come from the top down.

Third, demarcate the cult from the status quo by creating symbols, rituals, jargon, texts, clothing—a tangible way for cult members to live their difference, to mark themselves as apart from the mainstream. For Harley Davidson, there is the uniform of the riders, the leather jacker; slang; the brand’s and Hell’s Angels logos; and so on. For Atkin, this is the same as Hare Krishnas who avoid eating meat and chant mantras, or Mormons who have exclusive access to parts of their temple and wear spiritual garments underneath their clothes.

The final step is demonize the other. For Steve Jobs and the Apple cult, it was Microsoft and IBM. For Richard Branson’s Virgin Airlines, it was British Airways and American Airlines.

But according to Atkin, establishing a cult brand’s beliefs and sensibility are not enough. People don’t really buy into the ideology anyway. As much as brand managers think that projecting a compelling system of values to consumers, human interaction is what really gets people in the door and makes them stick around. One cult brand, JetBlue, obsesses over every interaction that customers have with gate agents, check-in personnel, telephone agents and flight attendants, ensuring that the brand values of bringing humanity, caring and fun back into air travel are reinforced at every point of contact.

Atkin cites academic studies that support his point of view. Sociologists who study the Unification Church discovered that most people were brought into the church by forming relationships with individuals in the church. New recruits first buy into those relationships—the ideology comes later. Research into the Mormon church confirms this pattern, showing that individuals with more in-group ties to individual church members become more devoted to the church and its belief system.”

2. The political manipulation by sharing economy players

“The various startups, investment funds, media outlets and nonprofit advocacy organizations shout from the rooftops that their new, improved version of communitarian capitalism will heal what ails us. Although they couch the message in terms designed to appeal to political progressives, there’s nothing about the services themselves that prevents them from being attached to a completely different set of values. For example, John Stossel, a noted libertarian and TV host on Fox News, has championed Airbnb’s fight against what he believes is big government regulation keeping the little guy down.

The conservative news sites Human Events published a column praising the sharing economy for relieving the burden of following employment laws:

it’s an end-run around the increasingly expensive, heavily mandated and regulated business of hiring employees. As the burden on labor increases, creative fee-for-service arrangements become appealing alternatives to expensive, traditional “jobs.” It’s the next logical step after the large-scale transition of the American workforce to part-time status.

A senior fellow at the right-wing Cato Institute voiced his support for Airbnb in their battle to roll back New York City hotel tax, rent control and zoning laws:

New York State Attorney General Eric Schneiderman, however, is challenging the entrepreneurial innovation—probably under pressure from special interests who would like the government to stifle their competition. This is crony capitalism as usual… Cato has long supported free markets, entrepreneurship, and innovations to make goods and services more affordable. Government overreach like [Attorney] General Schneiderman’s campaign punishes not only AirBnB hosts and travelers, but also the New York economy…

Another senior fellow at Cato argued that the sharing economy’s use of reviews to control service quality means that the rationale for government regulation disappears. The following comment was made in the context of the limo service Uber, but could apply to many other startups:

“The app’s review system makes it easy for the company to monitor driver quality without demanding too much effort from passengers… Which means the question isn’t whether the regulations need to be updated to accommodate a new kind of cab service: It’s why this kind of service needs a regulator at all.

The well-known Republican operative and future Burning Man attendee Grover Norquist recently weighed in, arguing that progressive’s ideological confusion over the regulatory issues facing the sharing economy is an opportunity for Republicans to take back control over major cities which are traditional Democratic strongholds.

The existing sharing economy values are designed to appeal to progressive liberals. It seems that there are very few “values-led” businesses which are designed to appeal to conservative values, suggesting that progressives are uniquely seduced by the view that capitalism is an effective tool for promoting their values and effecting political change. But it wouldn’t be difficult to invent a much more Republican-friendly brand for the sharing economy. In his speech at LeWeb before a group of investors and internet entrepreneurs quoted above, Atkin leaned in that direction, departing just slightly from the values of caring and connection that usually dominates and also stressing the values of autonomy: independence, individualism and entrepreneurialism.

We could move even further in this direction, rebranding the sharing economy as new movement that liberates individuals from the tyranny of the collectivism found in regular work, freeing them to become captains of their own destiny so they can pursue their self-interest by becoming small-scale entrepreneurs all while thumbing their nose at big government regulation. Brian Chesky, CEO of Airbnb alluded to this potential when he said to a group of Airbnb hosts, “There are laws for people and laws for business, but you are new category: people as businesses.

3. Negative consequences for workers

What would happen if the dreams of the investors and executives at these startups came true, and large parts of the economy became dominated by their business models? Employers that hire full- or part-time workers today—paying them minimum wage, overtime and unemployment, disability and social security taxes, and unable to discriminate against them—would switch to a cheaper, less regulated and more vulnerable workforce to do those same jobs. Having lowered their labor costs, they’re able to offer lower prices to consumers, forcing their slower competitors who rely on regular wage labor to adopt the same practices or go out of business.

But beyond the marketing, if people like Douglas Atkin, Brian Chesky and Rachel Botsman get their way, and the sharing economy as it is currently constituted expands dramatically to where a significant fraction of services are delivered using their business models, it will have serious negative long-term consequences for the people in their communities, and for all workers.

Sharing economy companies most often classify the people who provide services on their platforms as independent contractors—they are considered to be self-employed, not regular employees. At the end of each year, thousands of these contractors receive a 1099 form and their income is reported to the IRS. Since navigating the rules for filing self-employment taxes is not very straightforward, Rachel Botsman’s Collaborative Fund created 1099.is to help contractors understand their obligations. They say that the purpose of the site is “to try and help you to understand your taxes in the Sharing Economy.”

It turns out that employee classification is an important issue, and has some significant implications for both employers and employees.

The Department of Labor runs a program to go after companies who practice employee misclassification, a term used to describe companies who misrepresent their full-time employees as self-employed independent contractors. Because companies must pay more taxes for employees than contractors, the IRS and state tax agencies crack down aggressively on employee misclassification, treating it as a form of corporate tax evasion. To get a sense of the scale of the problem, the Government Accountability Office estimated that in 2006, $2.72 billion in federal taxes was lost by misclassifying employees.

The Department of Labor is also involved in investigating these cases because some employers try to avoid compliance with the provisions of the Fair Labor Standards Act and the National Labor Relations Act by misclassifying their workers. These laws give workers a host of benefits: the right to be covered by minimum wage laws, the right to overtime pay, the right to have employers pay social security, disability and unemployment insurance taxes, the right to family and medical leave, workers’ compensation protection, sick pay, retirement benefits, profit sharing plans, protection from discrimination on the basis of race, color, religion, sex, age or national origin, or wrongful termination for becoming pregnant, or reporting sexual harassment or other types of employer wrongdoing.

Workers classified as independent contractors are entitled to none of these benefits.

On it’s website, the Department of Labor says that “Business models that attempt to change or obscure the employment relationship through the use of independent contractors are not inherently illegal, but they may not be used to evade compliance with federal labor law.” That could mean that sharing economy startups are legal, but one former Lyft driver has filed a class action lawsuit against the company charging them with employee misclassification.

Whether the suit succeeds or not, the phenomenon of employee misclassification indicates that employers have strong financial incentives to use independent contractors, even when it is illegal. A study showed that on average, misclassification allows employers to save $3,710 in taxes for workers who earn $40,000 a year, and witnesses testified to Congress that the labor savings of misclassification have allowed federal contractors to lower their bids by 20-30%.

The Obama Whitehouse has moved aggressively to combat this form of corporate misconduct, endorsing the Fair Playing Field Act and the Employee Misclassification Prevention Act, laws that require employers to inform independent contractors that they have the right to contact the IRS to have their status reviewed if they believe they have been misclassified, increase penalties for violators, closes a tax loophole that allowed FedEx to dodge a $319 million bill for back-taxes owed when the IRS determined it had improperly classified some of its drivers, and makes infringement into a federal violation of labor laws. Obamacare also increases penalties for businesses who misclassify their employees to avoid triggering the requirement to provide health insurance if they have more than 50 employees.

When Human Events says that the sharing economy allows employers to do an “end-run around the increasingly expensive, heavily mandated and regulated business of hiring employees,” this is what they’re talking about.”


Posted in Cognitive Capitalism, Culture & Ideas, Sharing | No Comments »

Essay of the Day: Information Machine and the Society of Metadata

photo of Michel Bauwens

Michel Bauwens
21st July 2014

* Article: Italian Operaismo and the Information Machine. By Matteo Pasquinelli. Theory, Culture & Society February 2, 2014

From the Abstract:

“The political economy of the information machine is discussed within the Marxist tradition of Italian operaismo by posing the hypothesis of an informational turn already at work in the age of the industrial revolution. The idea of valorizing information introduced by Alquati (1963) in a pioneering Marxist approach to cybernetics is used to examine the paradigms of mass intellectuality, immaterial labour and cognitive capitalism developed by Lazzarato, Marazzi, Negri, Vercellone and Virno since the 1990s. The concept of machinic by Deleuze and Guattari (1972, 1980) is then adopted to extend Marx’s analysis of the industrial machine to the algorithms of digital machines. If the industrial machine can be described as a bifurcation of the domains of energy and information, this essay proposes to conceive the information machine itself as a further bifurcation between information and metadata. In conclusion, the hypothesis of the society of metadata is outlined as the current evolution of that society of control pictured by Deleuze (1990) in relation to the power embodied in databases.”


Posted in Cognitive Capitalism, Economy and Business, Featured Essay, P2P Movements | No Comments »

Save the Teatro Valle Commons in Rome!

photo of David Bollier

David Bollier
14th July 2014

The three-year occupation of Teatro Valle in Rome is now legendary:  a spontaneous response to the failures of conventional government in supporting a venerated public theater, and the conversion of the theater into a commons by countless ordinary citizens.  Now the mayor of Rome is threatening to end the occupation, evict the commoners and privatize the management of the facility.

It’s time for the international community of commoners to take a public stand against this very real threat. The mayor has summoned Italian law scholar Ugo Mattei to meet with him on Monday to negotiate a resolution. In advance of that meeting, Mattei and Salvatore Settis, President of the Advisory Board of the Louvre Museum in Paris, have prepared an international petition calling on the mayor to back away from his proposal and to allow this historic experiment in commoning to continue.

Below is a copy of the petition.  You can express your support by sending you name and affiliation to Ugo Mattei at matteiu /at/ uchastings.edu.

A number of human rights scholars around the world are keenly interested in Teatro Valle.  Noted human rights scholar Anna Grear alerted the Global Network for the Study of Human Rights and Environment that “the attempted denial of popular ‘ownership’ of ‘place’ is fundamental to the cultural and material enclosures enacted by privatising and controlling agendas.”  She added that “closing down an important, even iconic, example of a fundamentally vernacular, community-based engagement with place (a vibrant, evocative commons) is entirely consistent with the deeper logic visible in moves such as the attempt to control the world seed supplies and breeds, to extend the corporatisation of the social spheres, to privatise urban space in ways that shut ordinary human beings out of them in central and important respects.”

For more on the backstory of Teatro Valle, here is a previous blog post on the occupation from February 2013.  Below is the petition now circulating.  Sign it!

The commons “Italian Style” must continue their experimentation! An International call to protect the Teatro Valle Foundation from Eviction.

Since June 14 2011, a community of artists and militants has transformed the Teatro Valle, the oldest and most prestigious in Rome, then at high risk of privatization, into the “Teatro Valle Occupato,” one of the most advanced experiments of merger between political struggle and performing arts in the current world. A trust-like legal entity, the “Fondazione Teatro Valle Bene Comune,” was created in the interest of future generations, with a membership of almost 6,000 people by a genuinely new process of cooperation between some well-known jurists and the Assembly of the occupants. While a notary has recognized the Foundation, the Prefect of Rome has denied its moral personality on the assumption that possession was not a sufficient title on the Valle premises.

Nevertheless, in three years the occupation, though formally never authorized, has succeeded in becoming a new institution of the commons, studied by scholars worldwide and the object of many publications. Because no authority in Rome has ever asked the occupants to leave and the municipality has paid the energy bill (roughly 90,000 Euros per year), it would be difficult to deny that the occupation was largely tolerated (even by the previous post-fascist major). Certainly the occupants have taken very good care of the ancient Theater, including paying for small renovations, and have  generated three years of exceptionally interesting shows, performances, meeting, educational programs that the population could attend on the basis of a donation system according to the possibilities of each one. The Valle experience has also inspired similar actions to protect theaters and public spaces through Italy; it is promoting a nation-wide experiment of codification of commons institutions involving some twenty of the leading academic lawyers in Italy; it has produced its own shows performed Europe-wide and has attracted to the Valle some of the best-known artists and intellectuals in Europe.

The European Cultural Foundation, among others has granted the prestigious Princess Margritt Award to the Teatro Valle and the ZKM of Karsrhue has devoted to that experience a stand in a recent major International exhibition on social movements worldwide.

After the European Elections last May, possibly as a consequence of an ill-conceived legalistic stance by the new Government, early negotiations to settle the dispute concerning the title to the Theater have been suddenly terminated as the Assessor of Rome responsible for culture in Rome has been removed and not replaced. As a reply to the Foundation request to resume negotiations, the new major of Rome, a member of the ruling Democratic Party and a well-known academic doctor, has released two days ago a statement asking the occupants to leave, threatening police intervention and proposing a public auction to privatize the management of the space.

This cannot happen! The city of Rome, as a cultural center of the world deserves a better solution to the Valle issue. We strongly plea the Italian political authorities to look for a method which facilitates rather than repressing institutional and cultural experiments to run the commons.

Ugo Mattei, Professor, The University of California, Hastings and Università di Torino.

Salvatore Settis, President of the Advisory Board of the Louvre Museum, Paris.

Please sign this international petition with affiliation.

Originally posted at bollier.org


Posted in Activism, Anti-P2P, Campaigns, Cognitive Capitalism, Commons, Culture & Ideas, Economy and Business, Empire, Original Content, P2P Foundation, Politics | No Comments »

David Harvey on Piketty’s “Capital”

photo of Stacco Troncoso

Stacco Troncoso
7th July 2014

There’s been plenty of talk about Thomas Piketty’s recent volume. While the attention and awareness it has generated is not a bad thing, it’s also worth exploring some constructive critiques of the book that go beyond mere defensive slander. Of these we feel that David Harvey’s review of Piketty’s study, originally published on his webpage, is specially relevant.

Thomas Piketty has written a book called Capital that has caused quite a stir. He advocates progressive taxation and a global wealth tax as the only way to counter the trend towards the creation of a “patrimonial” form of capitalism marked by what he dubs “terrifying” inequalities of wealth and income. He also documents in excruciating and hard to rebut detail how social inequality of both wealth and income has evolved over the last two centuries, with particular emphasis on the role of wealth. He demolishes the widely-held view that free market capitalism spreads the wealth around and that it is the great bulwark for the defense of individual liberties and freedoms. Free-market capitalism, in the absence of any major redistributive interventions on the part of the state, Piketty shows, produces anti-democratic oligarchies. This demonstration has given sustenance to liberal outrage as it drives the Wall Street Journal apoplectic.

The book has often been presented as a twenty-first century substitute for Karl Marx’s nineteenth century work of the same title. Piketty actually denies this was his intention, which is just as well since his is not a book about capital at all. It does not tell us why the crash of 2008 occurred and why it is taking so long for so many people to get out from under the dual burdens of prolonged unemployment and millions of houses lost to foreclosure. It does not help us understand why growth is currently so sluggish in the US as opposed to China and why Europe is locked down in a politics of austerity and an economy of stagnation. What Piketty does show statistically (and we should be indebted to him and his colleagues for this) is that capital has tended throughout its history to produce ever-greater levels of inequality. This is, for many of us, hardly news. It was, moreover, exactly Marx’s theoretical conclusion in Volume One of his version of Capital. Piketty fails to note this, which is not surprising since he has since claimed, in the face of accusations in the right wing press that he is a Marxist in disguise, not to have read Marx’s Capital.

Piketty assembles a lot of data to support his arguments. His account of the differences between income and wealth is persuasive and helpful. And he gives a thoughtful defense of inheritance taxes, progressive taxation and a global wealth tax as possible (though almost certainly not politically viable) antidotes to the further concentration of wealth and power.

But why does this trend towards greater inequality over time occur? From his data (spiced up with some neat literary allusions to Jane Austen and Balzac) he derives a mathematical law to explain what happens: the ever-increasing accumulation of wealth on the part of the famous one percent (a term popularized thanks of course to the “Occupy” movement) is due to the simple fact that the rate of return on capital (r) always exceeds the rate of growth of income (g). This, says Piketty, is and always has been “the central contradiction” of capital.

But a statistical regularity of this sort hardly constitutes an adequate explanation let alone a law. So what forces produce and sustain such a contradiction? Piketty does not say. The law is the law and that is that. Marx would obviously have attributed the existence of such a law to the imbalance of power between capital and labor. And that explanation still holds water. The steady decline in labor’s share of national income since the 1970s derived from the declining political and economic power of labor as capital mobilized technologies, unemployment, off-shoring and anti-labor politics (such as those of Margaret Thatcher and Ronald Reagan) to crush all opposition. As Alan Budd, an economic advisor to Margaret Thatcher confessed in an unguarded moment, anti-inflation policies of the 1980s turned out to be “a very good way to raise unemployment, and raising unemployment was an extremely desirable way of reducing the strength of the working classes…what was engineered there in Marxist terms was a crisis of capitalism which recreated a reserve army of labour and has allowed capitalists to make high profits ever since.” The disparity in remuneration between average workers and CEO’s stood at around thirty to one in 1970. It now is well above three hundred to one and in the case of MacDonalds about 1200 to one.

But in Volume 2 of Marx’s Capital (which Piketty also has not read even as he cheerfully dismisses it) Marx pointed out that capital’s penchant for driving wages down would at some point restrict the capacity of the market to absorb capital’s product. Henry Ford recognized this dilemma long ago when he mandated the $5 eight-hour day for his workers in order, he said, to boost consumer demand. Many thought that lack of effective demand underpinned the Great Depression of the 1930s. This inspired Keynesian expansionary policies after World War Two and resulted in some reductions in inequalities of incomes (though not so much of wealth) in the midst of strong demand led growth. But this solution rested on the relative empowerment of labor and the construction of the “social state” (Piketty’s term) funded by progressive taxation. “All told,” he writes, “over the period 1932-1980, nearly half a century, the top federal income tax in the United States averaged 81 percent.” And this did not in any way dampen growth (another piece of Piketty’s evidence that rebuts right wing beliefs).

By the end of the 1960s it became clear to many capitalists that they needed to do something about the excessive power of labor. Hence the demotion of Keynes from the pantheon of respectable economists, the switch to the supply side thinking of Milton Friedman, the crusade to stabilize if not reduce taxation, to deconstruct the social state and to discipline the forces of labor. After 1980 top tax rates came down and capital gains – a major source of income for the ultra-wealthy – were taxed at a much lower rate in the US, hugely boosting the flow of wealth to the top one percent. But the impact on growth, Piketty shows, was negligible. So “trickle down” of benefits from the rich to the rest (another right wing favorite belief) does not work. None of this was dictated by any mathematical law. It was all about politics.

But then the wheel turned full circle and the more pressing question became: where is the demand? Piketty systematically ignores this question. The 1990s fudged the answer by a vast expansion of credit, including the extension of mortgage finance into sub-prime markets. But the resultant asset bubble was bound to go pop as it did in 2007-8 bringing down Lehman Brothers and the credit system with it. However, profit rates and the further concentration of private wealth recovered very quickly after 2009 while everything and everyone else did badly. Profit rates of businesses are now as high as they have ever been in the US. Businesses are sitting on oodles of cash and refuse to spend it because market conditions are not robust.

Piketty’s formulation of the mathematical law disguises more than it reveals about the class politics involved. As Warren Buffett has noted, “sure there is class war, and it is my class, the rich, who are making it and we are winning.” One key measure of their victory is the growing disparities in wealth and income of the top one percent relative to everyone else.

There is, however, a central difficulty with Piketty’s argument. It rests on a mistaken definition of capital. Capital is a process not a thing. It is a process of circulation in which money is used to make more money often, but not exclusively through the exploitation of labor power. Piketty defines capital as the stock of all assets held by private individuals, corporations and governments that can be traded in the market no matter whether these assets are being used or not. This includes land, real estate and intellectual property rights as well as my art and jewelry collection. How to determine the value of all of these things is a difficult technical problem that has no agreed upon solution. In order to calculate a meaningful rate of return, r, we have to have some way of valuing the initial capital. Unfortunately there is no way to value it independently of the value of the goods and services it is used to produce or how much it can be sold for in the market. The whole of neo-classical economic thought (which is the basis of Piketty’s thinking) is founded on a tautology. The rate of return on capital depends crucially on the rate of growth because capital is valued by way of that which it produces and not by what went into its production. Its value is heavily influenced by speculative conditions and can be seriously warped by the famous “irrational exuberance” that Greenspan spotted as characteristic of stock and housing markets. If we subtract housing and real estate – to say nothing of the value of the art collections of the hedge funders – from the definition of capital (and the rationale for their inclusion is rather weak) then Piketty’s explanation for increasing disparities in wealth and income would fall flat on its face, though his descriptions of the state of past and present inequalities would still stand.

Money, land, real estate and plant and equipment that are not being used productively are not capital. If the rate of return on the capital that is being used is high then this is because a part of capital is withdrawn from circulation and in effect goes on strike. Restricting the supply of capital to new investment (a phenomena we are now witnessing) ensures a high rate of return on that capital which is in circulation. The creation of such artificial scarcity is not only what the oil companies do to ensure their high rate of return: it is what all capital does when given the chance. This is what underpins the tendency for the rate of return on capital (no matter how it is defined and measured) to always exceed the rate of growth of income. This is how capital ensures its own reproduction, no matter how uncomfortable the consequences are for the rest of us. And this is how the capitalist class lives.

There is much that is valuable in Piketty’s data sets. But his explanation as to why the inequalities and oligarchic tendencies arise is seriously flawed. His proposals as to the remedies for the inequalities are naïve if not utopian. And he has certainly not produced a working model for capital of the twenty-first century. For that we still need Marx or his modern-day equivalent.


Posted in Cognitive Capitalism, Culture & Ideas, Economy and Business, Featured Content, Featured Essay, Politics | No Comments »

Essay of the day: Wu-Ming on Beppe Grillo and the 5-Star Movement

photo of Stacco Troncoso

Stacco Troncoso
24th June 2014

Beppe Grillo

Over here the situation is very bad, and people abroad are completely disinformed about it. Every day we read nonsense and bullshit on Grillo by people who completely ignore the reactionary, authoritarian nature of his movement. A harsh reality is biting our arses and we need to send a message in a bottle right now. 

So begins a fascinating long form essay published by the Italian writers’ collective Wu Ming in their resurrected-for-the-occasion blog. The essay is over a year old but no less relevant now, especially in light of the recent European election results. Beware of easy populism and the misappropriation of the terminology of the commons.

[A week ago a prestigious British magazine asked us for a long piece on Grillismo. We wrote it and submitted it, but there was some misunderstanding, and they edited it too heavily for our own taste. We clarified the matter with them, but at that point we were way beyond the deadline and the issue went to print without our contribution. Too bad, but no grudge held. The piece was too long - almost 5,000 words - to submit it to any other mag or newspaper, let them do all the editing all over again and have it published in a reasonable lapse of time. Over here the situation is very bad, and people abroad are completely disinformed about it. Every day we read nonsense and bullshit on Grillo by people who completely ignore the reactionary, authoritarian nature of his movement. A harsh reality is biting our arses and we need to send a message in a bottle right now. In the end, having no other possibility, we decided to publish the piece on this ugly, obsolete, long neglected blog, which is in bad need of complete reconstruction and a new start, but even in its present form is better than nothing. Of course it isn't as authoritative as that London magazine, and potential circulation is ludicrous in comparison, but what else can we do? Please feel free to copy our analysis and republish it wherever you want. Thanks.]

«Marriage is a bond between a man and a woman. How can you institute marriage between two persons of the same sex? Why not marriage between three persons then? Why not marriage between you and your animal? Some people have a strong relationship with their animal, would you allow them to marry it?»
(Francesco Perra, 5SM candidate at the recent national election, 8 June 2012 )

There is much confusion in other countries about what has been taking place in Italy in the past five years – the era of Late Berlusconism – and what is going on after the latest national election. At the time of writing, nobody knows what government Italy will have. No stable government can be formed without the vote of confidence of the Five Star Movement, the political organisation led by former stand-up comedian Beppe Grillo and web marketing guru Gianroberto Casaleggio. The 5SM, which stood for national election for the first time, gained 25.5% of votes for the Chamber of Deputies and 23.8% for the Senate.

Dario Fo

Dario Fo

Several Left-wing and progressive commentators tend to look with a certain sympathy to the Five Star Movement. They heard that evenDario Fo, a famously leftist Nobel Prize Winner, endorsed Grillo during the campaign. They think that Grillo’s fiery, pied-piperesque speeches are just a bit of theatre – he used to be a comedian after all.
Indeed, news from Italy are baffling as usual, but in the end, many have the impression that the 5SM is a populist movement oscillating between the progressive and radical quarters of the political spectrum. A movement having features in common with other anti-austerity movements and mobilisations across southern Europe (Portugal, Greece, Spain, Slovenia).
People who make that assumption should – literally – know better.
Trouble is, many Italians should know better too.

Simone Di Stefano: «Are you an antifascist?»
Beppe Grillo: «This question doesn’t concern me. 5SM is an ecumenical movement.»
(Conversation between Grillo and one of the top leaders of neofascist party CasaPound,11 January 2013 )

Some of you may have Italian friends who used to place themselves to the Left and recently chose to vote for the 5SM, or even become 5SM activists. We bet they didn’t tell you about the more right-wing aspects of the movement, because you’d certainly ask them: «I beg your pardon? You’re doing political work side by side with fascists? You’ve joined a movement that rejects the very notion of antifascism? A movement that wants to abolish trade unions?! You voted for a guy who praises Ron Paul and US-style ‘libertarianism’? Mate, what’s wrong with you?», and they’d have to scramble for self-justifications.

«Before it degenerated, fascism had a sense of national community (which it took directly from socialism), the highest respect for the state and a will to protect the [institution of] family.»
(Roberta Lombardi, 5SM member of Parliament, 21 January 2013 )

Your friends are probably aware of those aspects, but either underestimate them or instantly remove them, because they’re too disquieting. Such is the disgust toward «the old political system» that criticising a «new» movement is deemed as a manifestation of pedantry and intellectual luxury: «First of all, let’s give a shoulder push to the rotten political establishment, then we’ll talk about Grillo’s faults. We can’t afford that now!»
To us, this is a very dangerous approach.

1. How rancour towards «The Caste» helped prevent social conflict

La castaMany factors can explain Grillo’s success. The Zero years were a decade of social devastation, in which social movements encountered thundering defeats, while Late Berlusconism was fostering cultural and moral bankruptcy with the complicity of the long-discredited «centre-left».
Then, at the beginning of the new decade, the Euro crisis hit us between the eyes.
During the summer of 2011, the capitalist class and the European Central Bank decided that Berlusconi’s government was completely dysfunctional and unfit to enforce the «necessary» austerity measures. Despite a vast majority in both branches of Parliament, with a sort of legal coup the «centre-right» government was replaced with a «technical» government led by Mario Monti, a neoliberal economist long associated with Goldman Sachs and the Trilateral Commission.

Monti’s government was supported, albeit grudgingly, by both the centre-right and the centre-left. To tell the truth, the centre-left gave the impression of supporting Monti lessgrudgingly than the centre-right. In the end, the Democratic Party appeared more responsible than Berlusconi for the aggressive austerity measures which worsened the condition of the working class and the lower middle class in 2012. Something similar happened in Greece, where Papandreou’s Socialist Party was more strictly associated with cuts than the right-wing party New Democracy was.
The difference is that Greece witnessed mass demonstrations and general strikes against austerity, the IMF, the European Central Bank and so on, whereas in Italy social discontent was channelled toward a different target: the so-called «Caste».

«The Caste vs. the Honest People» is the most powerful conceptual frame in today’s Italy.
The Caste: How Italian politicians became untouchable is the title of a best-selling book written by two journalists, Gian Antonio Stella and Sergio Rizzo. It was published in 2007 and covered the ways in which national and local politicians used taxpayers’ money to become parasitic oligarchs. The book’s title provided the perfect metaphor to frame the debate on politics into a new version of a classic right-wing dichotomy: «ordinary people» are «clean», whereas «politicians» are «dirty». Indeed, they are not only dirty, they’re the biggest problem in the country. Let’s get rid of politicians, and everything will be ok!
The fact that politicians are in office precisely because the good ordinary people repeatedly voted for them is rarely mentioned.

Flavio Briatore

Flavio Briatore

«The Caste vs. the Honest People» proved to be the perfect diversionary narrative. Anger and frustration were channelled toward members of parliament, their salaries, public funding to political parties etc., all of which are real but lesser problems of the system. Meanwhile, austerity measures and eurocratic neoliberal policies were ravaging society, encountering no opposition. Unlike in Greece, Spain and Portugual, there was no mass movement fighting back.
It goes without saying that the real «caste» – the caste of millionaires, top CEOs, financial speculators and the likes – didn’t pay any price for the situation they had created. We even heard such tycoons asFlavio Briatore making anti-Caste statements, slagging off politicians and so on.

To name but one concrete consequence of the «Caste vs. the People» frame, this depoliticising narrative made the idea of a «technical» government acceptable, indeed, even desirable. Public opinion was brought to believe that a government with no politicians would be better than any traditional government. That’s why Mario Monti took advantage of an extended «honeymoon period» and was able to pass draconian acts that impoverished the majority of the population.

The «Caste vs. People» frame was activated in the political debate slightly before the 5SM came into existence, and paved the highway for it.
What Grillo and Casaleggio did on their own was extending the concept of «Caste» to include almost all civil servants, whom the 5SM rhetoric turns into mere parasites. In one of his most infamous blog posts, Grillo demanded that «tens of thousand of public employees [be] laid off». As Rossana Dettori – a leader of CGIL trade union – correctly pointed out, behind the phrases that Grillo uses in an abstract way (eg «public employees») there are hospitals and emergency rooms, firefighters, schools and kindergartens, social services for the elderly and the gravely ill, «as well as democratic institutions which ensure that such services keep working».

Truth is, Italy’s public sector has the highest rate of union enrollment and activity. 78.79% of public employees take part to the election of their workplace union representatives (RSU). Therefore, the real targets of Grillo’s invective against public employees are trade unions. He called for the utter«elimination» of trade unions more than once.

2. Mock «anti-austerity», mock radicalism

Not that Grillo doesn’t mention capitalism, the faults of bankers etc. He does it. However, there’s no peculiarity in that part of his discourse, he simply revives all the cliches of European right-wing populisms. The issue is framed in a simplistic neo-nationalist way: «real» capitalism (ie productive capitalism) is described as good because it is rooted in the territory, whereas financial economy is degenerate because it’s in the hands of evil transnational cliques and lobbie groups. Since the Euro is the main cause of the present crisis, if Italy leaves the Eurozoneand gets rid of politicians and kicks «tens of thousands» of (unionised) employees out of the public sector, then we’ll have the conditions for entering a new golden age.

Gad Lerner

Gad Lerner

We all know that there’s often an antisemitic streak underlying this kind of talk about «nationless» enemies. Is it a coincidence that antisemitic tirades and insults are frequent in the below-the-line section of Grillo’s blog? In November 2012 a guest-blogger on beppegrillo.it attacked Gad Lerner, a Jewish journalist who dared criticise Grillo, by calling him «Gad Vermer».Verme is italian for «worm», a classic insult in the antisemitic repertoire.

The most important thing to say about Grillo’s «anti-austerity» and anti-financial stance is that it’s just a façade. It’s a joke. At the end of the day Grillo is a multi-millionaire, for Christ’s sake!
Whenever a conservative populist movement is voted in office or takes over, their «anticapitalist», anti-finance rhetoric evaporates very soon and they end up administering the present state of things, financial capitalism included.

Maybe that’s why Jim O’Neill, the retiring chairman of Goldman Sachs Asset Management, recently wrote:

«I find the [Italian Election] outcome quite exciting because it seems to me for a country whose GDP has basically not changed since EMU started in 1999, something big needs to change. Maybe this election outcome and the peculiar mass appeal of the Five Star movement could signal the start of something new?»

Did we say «Goldman Sachs»? A few days ago, Grillo stated that the 5SM parliamentary groups were willing to vote for a new «technical» government including no politicians, because they would never vote confidence in any political government. They were even willing to support a «Monti Bis», a second Monti government, albeit with a limited mandate and strictly controlled by the new parliament. After months spent calling the premier «Rigor Montis», Grillo implicitly said that the former international advisor for Goldman Sachs is the «lesser evil» compared to political parties.
It was just a fleeting glimpse of naked truth, then the former comedian changed position one more time. Now he’s saying that he wants to conquer «100% of parliament» so «citizens become the state» and the movement «will no longer need to exist», which of course doesn’t mean anything but is good for causing a sensation.

[N.B. The last political leader to conquer 100% of Italian parliament and overlap his movement with the state ended up hanging upside down in a Milan square. It happened twenty-six years too late, but nowadays things happen faster, you know, there's the Internet and so on. Jokes apart, Grillo should study the history of his country before making such provocative statements, they aren't known to bring good luck to anyone.]

In case you still cling to your prior impression that Grillo’s movement is anti-austerity and radical, or at least a force for concrete change, why not take a look at what 5SM has been doing in the towns and cities they administer? For example, let’s look at what mayor Federico Pizzarotti did in Parma.
The key point of Pizzarotti’s campaign was opposition to the construction of a big incinerator whose impact on the environment and the health of citizens was considered catastrophic. In June 2012 Grillo himself stated: «They will never build that incinerator, if they want to build it they will have to step on the mayor’s dead body!». When journalistMarco Travaglio asked Grillo about the penalties the city would have to pay to contractors and subcontractors, he gave this answer: «Let’s not be silly: If paying the penalties is obligatory, we’ll find a way to pay them.» Well, the incinerator was turned on on 3 March 2013. The city couldn’t pay the penalties. Nobody had to step on Pizzarotti’s corpse.

During his campaign, Pizzarotti also promised that he wouldn’t raise the house tax and the boarding charge for public kindergartens. After he was elected, he raised both and explained: «We couldn’t do anything else». Like any other politician.
Now he’s planning to cut the salaries of city employees.

3. Right-wing influences on the Five Star Movement

Guglielmo Giannini

Guglielmo Giannini

Grillo’s rhetoric is chock-full of elements that can be traced back to different right-wing traditions, which he and Casaleggio meddle into a toxic jumble.
The most recognizable tradition is that of European conservative populism. In France this approach is known aspoujadisme, after its main 20th century promoter Pierre Poujade. In Italy, we usually call it qualunquismo [which we could translate as 'anyoneism'], after a mass petty bourgeiois movement founded by playwright Guglielmo Giannini in 1946.
Another tradition is US «libertarianism» / «anarcho-capitalism»: Ayn RandRon Paul, that kind of stuff. This influence is detectable in several parts of the 5SM programme. One of the movement’s most known representatives, Vittorio Bertola, explicitly stated «I like Ron Paul».
Of course, in Grillo’s rants we can also find the usual set of Thatcherite tropes and cliches which have become commonplace all over the West.
All these traditions have some basic features in common, one of which is hatred for trade unions and, generally, for the workers’ collective organisation and conquests, like national contracts etc. This hostility permeates all of Grillo’s speeches.

The reason why it is such an ungrateful task to expose the right-wing elements of Grillo’s rhetoric, is that confusionism is an intentional strategy. Grillo repeatedly screams that «there are no Left and Right anymore!». Meanwhile, he and Casaleggio skillfully intersperse the right-wing elements with left-wing ones, reproposing buzzwords, concepts and claims they hijacked from the previous social movements. These concepts are reprocessed, they receive a treatment that strips all articulations and leaves them void of all content. The most striking example is «direct democracy».

4. Direct democracy, Führerprinzip and character assassination

Despite all the talk about direct democracy or online liquid feedback, the 5SM is a top-down organisation with no intermediate bodies between Grillo and Casaleggio and the populace of fans/activists. Every major decision is taken by those two wealthy sixty-somethings, and «direct democracy» only amounts to calling on the base to approve it in a tele-plebiscitarian way.

In the 2011-2012 period, the 5SM of Emilia-Romagna (the region whose capital is Bologna, the city in which we live) was stormed by a wave of expulsions. «Dissidents» like Giovanni FaviaValentino TavolazziFederica Salsi and many others dared question the absence of internal democracy. As a consequence, they were kicked out and exposed to angry online mobs. Expulsions were decided by Grillo and Casaleggio and communicated to the world by short posts on beppegrillo.it.
Local activists expressed solidarity with the expelled and organised meetings in which the majority voted in favour of readmission, but their vote was completely overruled by the two bosses.
The final step was the use of the Internet to slander the expelled in all possible ways. «Loyal» grillini devoted their time and efforts to disrupting all online conversations in which anyone defended the «traitors» and criticised Grillo and Casaleggio for their clearly autocratic behaviour.

Federica Salsi

Federica Salsi

5SM local leaders seem to have no hesitation in using «lynching» as a positive concept. On 2 March 2013Andrea Defranceschi, 5SM representative at the Emilia-Romagna council, stated: «If some of us betray the movement, the Internet will lynch them.»
By «lynching», of course, Defranceschi means the character assassination of dissidents. If anyone dares disagree with Grillo and Casaleggio, their reputation must be destroyed, and this destruction shall continue long after the expulsion. These people cannot be simply left alone, their blog or Facebook page must be bombarded with derogatory comments every day. In a matter of few months, local councillor Giovanni Favia shifted from being revered as the very incarnation of 5SM values to being described as the vilest traitor. And if the dissident is a woman, sexist insults will rain on her: «whore», «bitch» and the rest of the repertoire. That’s what happened to Federica Salsi.
This is a clear manifestation of cult mentality and, in fact, the 5SM is often described as a cult. It is often compared to Scientology. Scientology rejected the comparison.

You may ask: how can Grillo and Casaleggio get away with all that?
Well, it’s all written in the movement’s  «Non-Statute».
The «Non-Statute» is a very short text which, for years, has been the only written document regulating the movement’s internal life. It mainly says that the 5SM’s name and logo arethe sole property of Beppe Grillo and that the movement’s «headquarters» are located on Grillo’s weblog, beppegrillo.it.

If you already think that the 5SM notion of «online direct democracy» is bizarre to say the least, well, wait, you haven’t seen anything yet! We suggest you to watch a sort of video-manifesto which Casaleggio authored and produced in 2007. It’s entitled Gaia: The Future of Politics. «Creepy» is the right adjective for the anarcho-capitalist future Casaleggio enthusiastically envisions.

How do pro-Grillo leftists or former leftists react when someone points out these serious problems?

5. Fascists in Grillo’s (and Berlusconi’s) Fatherland

Before answering that question, it is necessary to make clear that the vast majority of both 5SM activists and sympathisers do not come from the radical Left. Most of them are quite young and have no previous political experience (or even position);  others come from the right and even the radical right.

In several areas of the country, the backbone of consent for the 5SM is formed by people who previously supported Berlusconi, the xenophobic Northern League, and in some cases utterly neofascist parties such as New Force and Tricolour Flame. In 2012, when the 5SM won the election in Parma and managed to elect Federico Pizzarotti as mayor of the city, the biggest chunk of votes (25.9%) came from people who had previously chosen the Northern League.
After all, Grillo’s and the 5SM position on immigration and minorities is very close to that of the NL. We quote from one of his blog posts , its title was «The Desacred Borders» and was published on beppegrillo.it in october 2007:

«A country cannot PASS THE BUCK TO ITS CITIZENS in dealing with the problems caused by tens of thousands of Roma gypsies coming to Italy from Romania. Prodi’s objection is always the same: Romania is in Europe. But what does ‘Europe’ means? SAVAGE MIGRATIONS of jobless persons from one country to another? Without knowing the language, with nowhere to put them up? Every day I receive hundreds of letters on Roma gypsies, it’s a volcano, A TIME BOMB, and it must be defused… What is a government that doesn’t guarantee the safety of its citizens good for?… The borders of the fatherland used to be sacred, politicians have desacred them.»

Last but not least, Casaleggio himself is a former sympathiser of the Northern League.

According to attorney Vincenzo Forte - an ex-leader of the neofascist Italian Social Movement and now a supporter of Grillo – three of the new 5SM MPs and one 5SM senator (all four elected in Lombardy) have a radical neofascist background. Forte didn’t reveal their names but added:

«These are not isolated cases, it’s a much more vast, deep-rooted phenonemon, a carefully organised strategy to penetrate Grillo’s movement. This strategy is being carried out with maximum discretion by local neofascist groups. »

The 5SM has no ethical or theoretical defence against this, because Grillo and Casaleggio have staunchly refused to adopt antifascism as a differentiating value. Grillo wants the movement to be «ecumenical» and antifascism «doesn’t concern him».

Silvio Berlusconi after too many facelifts.

It is far from incomprehensible that many fascists, berlusconesand leghisti are now looking to Grillo. Not only they like many of the things he says, but he also embodies their idealtype of the Strong Man mesmering enthusiastic crowds. To these people, Berlusconi and Bossi were no longer strong/fascinating enough, for they became too compromised with «old politics« and «the Caste». That’s why these angry petty bourgeois are making an emotional investment on someone they see as a new leader.
Moreover, there are deep similarities between Berlusconi and Grillo. They are both living testimonies of how the 1980s entertainment and television industry reshaped Italy’s national life. Journalist Giuliano Santoro wrote a very interesting book about this, it is entitled Un Grillo qualunque: Il populismo digitale nella crisi dei partiti italiani [A Grillo whatsoever: Digital populism in the crisis of Italian parties].
As a matter of fact, one cannot fully understand Grillo if s/he didn’t understand Berlusconi. Three years ago, in a piece for theLondon Review of Books, we easily predicted that after the fall of Berlusconi there would be a Berlusconism-without-Berlusconi. Nowadays things are even worse, because Berlusconi «fell» but is still around and 29.1% of voters have chosen him for the umpteenth time. As a result, we have both old, classic berlusconism-with-Berlusconi, and a new kind of berlusconism without him. Giuliano Santoro wrote that «Grillo is the continuation of Berlusconi by other means.»

6. TINA, TITA and the 5SM’ «neitherism»

Now let’s focus on those leftists and ex-leftists who are – critically or uncritically – giving their trust to 5SM. We want to focus on them for two reasons:
First, it is important to understand what consequences the Left’s absence or bankruptcy can have during a crisis like the current one;
Secondly, we have noticed that the representation of Grillo’s movement among radicals and progressives abroad is more or less a synthesis of the two typical discourses uttered by Italian pro-Grillo radicals – only with much less information available.
We call these discourses «5SM TINA» and «5SM TITA».

These days, each time we talk with veterans of yesterday’s struggles who voted for the 5SM, and try to reason with them, the most likely words we manage to extract from their mouths is:

«Yes, I do know it’s an ambiguous movement. I’m not at ease with everything they say and do. Yeees, yes, their agenda is partly neoliberal. Their statements on migrants are unacceptable. I don’t like the blend of populism and corporate jargon either. I’m suspicious of the personality cult surrounding Grillo, and the role played by Casaleggio isn’t clear. I agree with you, there’s more than a little bit of fanaticism within the movement. I did see pro-5SM trolls in action on the Internet. I agree with you, those mass expulsions make me think of 1937 stalinist purges. Do you think I’m blind? Of course I see that fascists are also joining… And yet some of the 5SM claims and proposals are exactly the same that we’ve been making for years! Their program includes the «citizens’ income», the defence of commons, ecology… I know many decent people who’ve become 5SM activists. Maybe we can tactically use the 5SM in order to smash the old political system, they’re doing that, aren’t they? Nobody managed to do that before. Why not try and see what happens after the shoulder push? There Is No Alternative anyway. The left is dead.»

This is what we call the Five-Starred Leftist «There Is No Alternative» Discourse. It is based on a classical Yes/But device: people say they agree on all the critical issues, which are many, then they say something like «but» or «and yet», and even if the adversative is sustained only by wishful thinking, it wipes out everything they just acknowledged.

In short: they understand that the 5SM is a confusionist movement with a dominant right-wing approach to many key issues, but the movement’s success and the fact that some proposals have Left-wing origins make them hope this is a good opportunity to «do something».
To us, «doing something» is not necessarily a good line of conduct. It depends on what you do. Sometimes it’s better not to do anything than doing something stupid. Mistaking a right-wing movement for a left-leaning one is definitely stupid.

Other former leftists are buying whatever story Grillo and the 5SM tell them. They utter another discourse, the Five-Starred Ex-Leftist «This Is The Alternative» Discourse:

«What you’re saying is false. You believed the vicious lies that the Caste spreads around. There are certainly some racists, because the movement is open to everyone, but they’re minorities. The majority are people like you and me who want to fight the system. We’ll keep racists in check. Those who were kicked out of the movement were opportunists and infiltrators sent by the old parties. They violated the Non-Statute. Grillo is not a leader, he’s nothing other than a megaphone. The fact that he legally owns the movement’s name and logo is only a guarantee that local sections will respect the Non-Statute. I trust him. When the movement is strong enough, Grillo will step aside. Casaleggio only suggests communication strategies, there’s nothing dark or ambiguous about that. This Is The Alternative, at last! I’ve been waiting for something like this for years, don’t ruin everything with your usual criticism!»

Notice the classic faith in a «two-stage» process: in the current situation Grillo has necessarily to play a major role; later on, he will surely step aside.
In the history of communist movements, all personality cults were invariably described as merely «transitional».
In 1958 Mao Zedong famously argued that there is nothing wrong in personality cult in and of itself. It depends whether that personality represents revolutionary truth or not.
Eighty-seven year old Dario Fo, to mention but one name, was very close to maoism during the 1970s.
This mindset facilitated the conversion of former communists to Grillismo. In this way, we think they ended up on the opposite side of the political spectrum.
When did such a thing happen last time?
It happened in the early Twenties.

Programma di San Sepolcro, 1919

The 5SM’s catch-all programme cannot but remind us of early fascism’s Programme of San Sepolcro (1919). In those days, fascism was still a «neitherist» movement («neither left nor right») launching «revolutionary» slogans in every direction.
In 2011, when we started citing that historical precedent, many people sneered at us. Then, on 5 March 2013, Roberta Lombardi – fresh president of the 5SM group at the Chamber of Deputies – made an explicitly positive reference to the Programme of San Sepolcro in order to explain the unacceptable statement we used as one of the epigraphs of this article.

Are we arguing that, when all is said and done, the 5SM is a fascist movement?
The answer is: no.
For sure there are fascists in there, and certainly the right-wing elements of the programme are more relevant than the left-wing ones. However, the 5SM is indebted with different right-wing traditions, a part of its constituency is still on the left, and labelling the movement as merely fascist would be too simplistic.
What we’re trying to say is that, especially in Italy, confusionist «neitherism» always thrives on economic and political crisis, and a part of the Left is tempted to listen to that siren song. Those who don’t resist the temptation invariably end up on the Right, be they aware of it or not.

7. Now what?

Why aren’t foreign correspondents living in Italy saying these things? They write about Grillo every day, but they rarely provide insights on the movement’s inner contradictions. Maybe these contradictions are less visibile if one doesn’t have a deep knowledge of our national history? And yet racist, homophobic or aynrandesque statements should be recognizable in all contexts. We don’t have a clear answer for such questions.

Gianroberto Casaleggio

Gianroberto Casaleggio, co-leader and media guru of 5SM.

What’s going to happen now?
As far as «change» (that empty word) is concerned, probably much less than everyone expects. As we tried to demonstrate above, the 5SM is far from being a radical force and its programme is full of «solutions» that are actually part of the problem. Even on the very day of the election, while many commentators were jumping on Grillo’s bandwagon, we wrote that, despite its incendiary slogans, the 5SM acts as a diversionary movement and prevents social conflict from erupting. Grillo says that himself, although of course he calls conflict «violence»: «If violence doesn’t start here, it’s because of the movement».
As often happens with populist movements, Grillo’s movement will apparently destabilise national politics, but it will only ripple the surface, and in doing so it will stabilise the system. That’s why pro-Grillo excitement can be found in such an unlikely place as Goldman Sachs.

We hope that progressives and radicals who joined the 5SM, or sympathise with 5SM, or at least voted for it, understand that the tiresome «neither left nor right» stance can no longer hide all the contradictions we highlighted.
We recently wrote that «we’ll side with rebellion inside the 5SM». What does that mean?
It means that we expect these contradictions to get ever sharper, to intensify until they explode. The movement’s «Left» must overcome TINA and TITA, manifest itself in a clear way and reject both the agenda of the «Right» and Grillo’s blank, confusionist rhetoric. Internal conflict is not an implausible outcome of this phase. We must look at that process with great attention, and be there when some of the energies that Grillo and Casaleggio captured will manage to get free from that grip. Those energies can be invested into a more consistent, unambiguous, radical movement. That’s why we tifiamo rivolta, we «cheer for a riot» inside the 5SM.


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Eben Moglen: “Snowden and the Future”

photo of David Bollier

David Bollier
14th June 2014

The ongoing Snowden revelations about NSA surveillance have all sorts of implications for the rule of law, constitutional democracy, geopolitical alignments, human rights and much else.  The disclosures deserve our closest attention for these reasons alone.  But what do these revelations have to do with the commons?

If we regard the act of commoning as a genre of citizenship – acts of voluntary association and action that are critical to human freedom and democracy – we can see that snooping by both the NSA and its corporate brethren are profoundly hostile to the future of the commons.  They violate some fundamental notions of human rights, civil freedoms and the ability of individuals to protect their privacy and thus their sovereignty.

If the market/state apparatus can digitally monitor our reading habits and telephone calls, email correspondence and purchases, physical movements and much else, then it has effectively snuffed out the sovereignty of a free people. The barrage of the successive Snowden disclosures has been followed by a relentless government propaganda war, cable TV denunciations and even attacks on Greenwald by the liberal nomenklatura (Michael Kinsley, George Packer). It’s as if “respectable opinion” did not care to note or defend the elemental human freedoms that a functioning democracy requires.

It was such a pleasure therefore to (belatedly) encounter a series of four lectures delivered last fall by Eben Moglen, a law scholar and historian at Columbia Law School, founder of the Software Freedom Law Center, and former general counsel of the Free Software Foundation.  The four talks – “Snowden and the Future” – offer one of the most eloquent and historically informed critiques of the Snowden revelations and their implications for freedom, democracy and – I would add – the capacity of people to common.

The lectures address the following themes:

  •  What has Edward Snowden done to change the course of human history?
  •  How does the evolution of surveillance since World War II threaten democracy?
  •  What does it mean that information can be both so powerful and so easily spread? In a network embracing all of humanity, how does democracy survive our desire for security?

On this blog, I try to avoid venturing into topics that veer off-topic such as, say, national security politics or election campaigns.  But I make an exception in this case because the rise of state surveillance in collaboration with the corporate digital giants has enormous ramifications for the commons movement. The NSA’s routine and sweeping surveillance not only affects our potential to think and act as commoners by installing fear and self-censorship; it seeks to structurally and permanently lock in such profound unfreedom. It makes any bottom-up citizen initiative or commons subject to absolute government control, as enabled by absolute top-down control of the Internet and all communications infrastructures:  a totalitarian growth upon a nation that has fought and died for freedom.

Free software champions have long pointed out the enormous importance of free/libre/open source software – and digital commons more generally – as guarantors of basic human rights and freedoms.  Now the reality of these assertions has been vividly confirmed.

It is a treat to see a law scholar who clerked by Justice Thurgood Marshall and has defended legal software encryption, address the meaning of the Snowden disclosures. I will not attempt to summarize Moglen’s incisive, powerful commentary, but I will offer this excerpt as a taste, and encourage you to read the entire four lectures.  It’s a long read, but well worth it:

The power of that Roman Empire rested in its control of communications. The Mediterranean Sea, which was the transit hub of every western civilization, was their lake. And across their European empire, from Scotland to Syria, they pushed the roads—roads that fifteen centuries later were still primary arteries of European transportation. Down those roads which, as Gibbon says, rendered every corner of the Empire pervious to Roman power, the Emperor marched his armies. But up those roads he gathered his intelligence. Augustus invented the posts: first for signals intelligence, to move couriers and messages at the fastest possible speeds; and then for human intelligence. He created the post-chaises, so that, as Gibbon says, those who were present when dispatches were written could be questioned by the Emperor. Using that infrastructure for control of communications, with respect to everything that involved the administration of power, the Emperor of the Romans made himself the best informed human being in the history of the world.

That power eradicated human freedom. “Remember,” says Cicero to Marcellus in exile, “wherever you are, you are equally within of the power of conqueror.”


Because of Mr. Snowden, we now know that the listeners, in their aggressive effort to maintain the security of the United States by breaking anything that stands in the way of listening, undertook to do what they repeatedly promised respectable opinion in the trade they would never do.

Systematically, they attempted what they had once and for all promised many a time in the discreetest but most credible fashion to respectable opinion, which then carried their water for them throughout our world. They always said they would not attempt breaking the crypto which secures the global financial system.

That was false.

When, on September 6th, the New York Times re-entered the pursuit of journalism in this area so triumphantly, by revealing the existence of Bull Run, publishing Mr. Snowden’s various disclosures concerning both the substance of Bull Run and the National Security Agency’s discussions of it, we learned that the United States listeners had been systematically and deliberately trying to subvert the crypto that holds the international financial system together, for years. And we learned a good deal more—which we shall spend more time upon on another evening, considering carefully what we learned in this respect—we learned that their efforts had been so far only partially successful.

Within hours they had forfeited respectable opinion around the world, which had stood solidly in their corner all the way along. The recklessness of what they had done, and the danger to which it put the people in the world who don’t accept danger from the United States Government, was breathtaking.

When the morality of freedom is so thoroughly thrown away, it isn’t only the “little people” of the world who suffer, but they do.

The empire of the United States, the one that secured itself by listening to everything, was the empire of exported liberty. What we had to offer all around the world was freedom—after colonization, after European theft, after the forms of twentieth-century horror we haven’t even talked about yet—we offered liberty; we offered freedom.

In the twentieth century we were prepared to sacrifice many of the world’s great cities, and to accept the sacrifice of tens of millions of human lives, in order to secure our selves against forms of government we called “totalitarianism,” in which the State grew so powerful and so invasive that it recognized no longer any border of private life, and brought itself into everything that its subjects did. Where the State listened to every telephone conversation, and kept a list of everybody every troublemaker knew.

So let us unfortunately tell the truth as it appeared to the people who worked in the system: When the morality of freedom was withdrawn, our State began fastening the procedures of totalitarianism on the substance of democratic society.

There is no historical precedent for the proposition that the procedures of totalitarianism are compatible with the system of enlightened, individual, democratic self-governance. No one has ever previously in the history of the human race evolved an argument—and as I will show next time no argument can be evolved—that would give us any confidence in the ability of the procedures of totalitarianism to coexist with those of constitutional democratic self-governance. It is enough to say for now that omnipresent invasive listening creates fear. And I need not be Justice Brandeis to tell you that fear is the enemy of reasoned, ordered liberty.

Here are the four parts of the Moglen lectures, available in video, audio and print formats:

I.  Westward the Course of Empire 

II.  Oh, Freedom 

III.  The Union, May it Be Preserved 

IV.  Freedom’s Future 

Originally published at bollier.org


Posted in Activism, Anti-P2P, Cognitive Capitalism, Copyright/IP, Culture & Ideas, Empire, Featured Content, Featured Video, Original Content, P2P Foundation, P2P Warfare, Politics | No Comments »

Douglas Rushkoff on debt, outsourcing and suburban isolation

photo of Stacco Troncoso

Stacco Troncoso
11th June 2014

Continuing our serialization of Penny Nelson’s  interview with Douglas Rushkoff for HiLobrow magazine, this week the conversation turns to the emotional components of debt, the inherent structures of corporations and why men must be kept busy with the front lawn.   We recommend that you read the first part if you haven’t already, to get some context. Please, check back on Friday for the third and final installment.

4. Let’s All Be Independent Together

[Rudolf the Red-Nosed Reindeer, dir. Kizo Nagashima, Larry Roemer, 1974]

PN: How does idea of the individual fit into these other developments?

DR: Corporatism, with its promotion of competition between individuals over scarce resources and money, laid the ground for individualism and for a heightened concept of the self. I’m a media ecologist, I look at media and society as an ecology in which changes in one area reflect changes in another. The notion of the individual was invented, re-invented, in the Renaissance. This is part of why it was a re-naissance, a re-birth of old ideas, the rebirth of Greek ideals. The the Greek notion of the individual, which was always “the individual in relationship to the state,” the citizen, was recast as “the individual.”

The first individual in Renaissance literature was Dr. Faustus, who represented the extreme limits of greed. This was the new man, not a citizen of the city-state but an individual who has his own perspective on the world. We get perspective painting in the Renaissance, which meant the individual was a self-sufficient being whose point of view is important; we get reading in the Renaissance, which meant that a man can sit alone in his study and have his own relationship to the Bible, instead of gathering in the town square or the church, having the Bible read to him by a priest, as part of a congregation. So on the one hand it was this beautiful celebration of individual consciousness and perspective, but on the other it was all in the context of a new economy, one in which individuals were in competition against one another for scarce jobs, scarce resources, scarce land, and scarce money.

PN: OK, I’ll ask: but what about the artists?

DR: Historians say that one of the great things about the Renaissance were the patrons who could patronize a great artist. But before the Renaissance you didn’t need a “patron” in order to be an artist! You could actually live in a town and do some stuff and be a great artist. The Renaissance model of commerce and arts was not a pre-existing condition of the universe. Yes, the Vatican could commission some basilica to be painted, but . . . I’d be interested to see what Leonardo da Vinci or Michelangelo would have been like had they not been part of a centralized bureaucracy, but instead been independent little homespun artist guys. They might have been better artists . . . you never know.

PN: So now we have individuals and corporations as we know them.

DR: The king’s currency, centralized currency, is monopoly currency; demurrage currencies were declared illegal by the king. Why? First, centralized currency is easier to tax. Second, the king could remove gold from the currency whenever he wanted, he could basically suck the value out of it at will. And finally, because this is a currency based in scarcity, everyone has to compete for it. It’s a way to help people who have money be powerful just for having money — not because of what they can spend, but because of what they can hold.

PN: So money becomes a resource.

DR: It becomes a resource in itself. Actually it’s a resource once-removed, literally a derivative, the first derivative. Centralizing turns money from a representation of something real into a derivative asset class. We live in this derivatives-based economy today, it has trickled down to us in the form of central banking. Now most people believe that the way to fuel an economy is for a bank to inject money, and the way to start a business is by borrowing from the bank. The way that money comes into existence is it is literally lent into existence. But for every dollar that is lent into existence, for every dollar you earn, there’s a negative on the balance sheet somewhere.

PN: There’s debt right at the beginning?

DR: It is debt, the money we have is debt. Here’s how it works. You start a business by borrowing $100K from the bank. This means that you’re going to have to pay back say, $200K or $300K to the bank in 10 years when your loan is up. Where does the other $200K come from? It comes from someone else who’s borrowed $100K from the bank. And where are they going to get that? Either they go bankrupt, because they can’t pay it back, or they borrow another $200K from the bank. And then that has to be paid back, plus interest. So now they’ve borrowed $300K total and might have $900K to pay back.

The money supply has to grow as a function of interest. The rate at which we do business and make profit is actually driven and determined by the debt structure of the company rather than supply and demand. This is what Adam Smith was actually talking about. Adam Smith was not a free market libertarian, he was not a corporate industrialist the way the Economist or the Wall Street Journal likes to paint him. Smith said that economies only work in scale, they only work locally. He was living in a world where everyone was a farmer, and he hated corporations as much as he hated central government, because he knew that an interest-based economy does not ultimately work. And that is because debt is not actually a product. There’s nothing there.Nothing. Yet that’s what it was made for. The debt-based economy was invented so that people with money could get richer by having money, that’s what it’s for. I’m not saying it’s evil, it was an idea. But, it doesn’t actually work. If the number of people who want to make money by having money gets so big that there are more people existing that way than actually producing anything, eventually the economy will collapse.

PN: It sounds like a big Ponzi scheme.

DR: It is a Ponzi scheme! None of the companies we’re looking at as companies are what they are, they’re all just the names on debt. GM is a name on debt, Sony’s a name on debt.

PN: The New York Times . . .

DR: . . . is a name on debt. They’re all publically-listed, traded companies with these P/E ratios; there are the issued shares, and then there’s the actual business: those two things aren’t the same. The shares are actually more a drag on the system than they are an investment in the company. There’s all this debt to pay back.

5. Corporations R Us

[Monopoly Guy, street art by Alec, 2010]

PN: Debt has an emotional component as well, in the sense of, you’re going to owe me, and you’re going to owe me forever. So, better get to work, no slacking.

DR: Slowly over time, as corporations attempted to extract more and more value from people, both as workers and as consumers and ultimately as shareholders and investors in our own 401k plans, we all basically outsourced our lives. I outsource my job to a company. I outsource my consumption to a company, I go to Wal-Mart, I go to Costco. I outsource my investing and savings to companies, I give it to Citibank, instead of the local banker or my credit union or my restaurant or my children or my cathedral. All of our interactions have been mediated by corporations — you don’t work for me and I don’t work for you.

PN: Let’s talk about different kinds of value. Right now we have money, we measure everything by the little green metric. But there are other kinds, we all know that, there are personal relationships, there are other ways of measuring value . . .

DR: We have different ways of experiencing value, but it’s really hard to measure those. I feel that in the current environment, what people could or should be valuing makes them nervous, makes them anxious.

PN: What kind of ways?

DR: Sitting with a friend . . . OK, I’ll sit with a friend as long as I have my Paxil or something, because it’s almost like we’ve been acculturated to be desocialized. I can spend time with you because we’re working, right?

PN: Right, it’s productive.

DR: Productive — and we can measure it on the tape! Is it still turning?

PN: You’re saying money is not value-neutral.

DR: Not only is money not value-neutral, but our money is not money-neutral. Our currency is not the only money. There are other kinds of money, just like there are different kinds of media out there, and they all encourage different behaviors. Computers encourage certain kinds of behavior, television encourages certain kinds of behavior. A gold-based money encourages certain kinds of behavior, a centralized currency encourages certain kinds of behavior, and a demurrage local grain-based currency encourages certain other kinds of behavior. The kind of behavior that our money encourages, intentionally, by design, is: hoarding. This is currency that earns interest over time so you want to hoard it and not spend it. And that’s OK if you need that tool.

PN: But maybe that shouldn’t be the only thing in the toolbox?

DR: It’s like we only have a hammer and it’s really hard to put in screws. Centralized currency is really, really good for competition, it’s really, really good for big companies. Wal-Mart and Citibank can get money more cheaply; the bigger you are, the closer you are to the storehouse. And the big guys don’t want local currencies, they don’t want bottom-up value creation, work-based money, money that is worked into existence instead of borrowed into existence, because that reduces their monopoly over the means of exchange.

PN: The problem with defining ourselves by our jobs or socialism or by economic class is that we’re not just our economics, we’re not just our money.

DR: Right, I create value, but the value I create for my community is not just say, as a baker. It’s not just as a tailor. It’s also as the guy who brings those funny jokes to the party, the guy who has that beautiful daughter . . .

PN: And it’s not just ONE thing and it’s not measurable in just one way.

6. Home Sweet Home Depot

DR: From the 1920s to the 1970s an iconography was developed that turned corporations into our heroes. Instead of me buying stuff from people I know, I actually trust the Quaker Oat Man more than you. This is the result of public relations campaigns, and the development of public relations as a profession.

PN: Did the rise of PR just happen, or did they have to do that in order to prevent things from getting out of control?

DR: They had to do that in order to prevent things from getting out of control. The significant points in the development of public relations were all at crisis moments. For example, labor movements; it’s not just that labor was revolting but that people were seeing that labor was revolting. There was a need to re-fashion the stories so that people would think that labor activists were bad scary people, so that people would think they should move to the suburbs and insulate themselves from these throngs of laborers, from “the masses.” Or to return to the Quaker Oats example, people used to look at long-distance-shipped factory products with distrust. Here’s a plain brown box, it’s being shipped from far away, why am I supposed to buy this instead of something from a person I’ve known all my life? A mass media is necessary to make you distrust your neighbor and transfer your trust to an abstract entity, the corporation, and believe it will usher in a better tomorrow and all that.

It got the most crafty after WWII when all the soldiers were coming home. FDR was in cahoots with the PR people. Traumatized vets were coming back from WWII, and everyone knew these guys were freaked out and fucked up. We had enough psychology and psychiatry by then to know that these guys were badly off, they knew how to use weapons, and — this was bad! If the vets came back into the same labor movement that they left before WWII, it would have been all over. So the idea was that we should provide houses for these guys, make them feel good, and we get the creation of Levittown and other carefully planned developments designed with psychologists and social scientists. Let’s put these vets in a house, let’s celebrate the nuclear family.

PN: So home becomes a thing, rather than a series of relationships?

DR: The definition of home as people use the word now means “my house,” rather than what it had been previously, which was “where I’m from.’” My home’s New York, what’s your home?

PN: Right, my town.

DR: Where are you from? Not that “structure.” But they had to redefine home, and they used a lot of government money to do it. They created houses in neighborhoods specifically designed to isolate people from one another, and prevent men in particular from congregating and organizing — there are no social halls, no beer halls in these developments. They wanted men to be busy with their front lawns, with three fruit trees in every garden, with home fix-it-up projects; for the women, the kitchen will be in the back where they can see the kids playing in the back yard.

PN: So you don’t see the neighbors going by. No front porch.

DR: Everything’s got to be individual, this was all planned! Any man that has a mortgage to pay is not going to be a revolutionary. With that amount to pay back, he’s got a stake in the system. True, he’s on the short end of the stick of the interest economy, but in 30 years he could own his own home.


Posted in Activism, Anti-P2P, Cognitive Capitalism, Collective Intelligence, Culture & Ideas, Economy and Business, Empire, Featured Content, Featured Essay, Guest Post, P2P Foundation, P2P Money, Politics, Sharing | 2 Comments »

Essay of the day: Snowden, the Terminator, and Us

photo of Stacco Troncoso

Stacco Troncoso
8th June 2014

A very recent, stirring essay, written by Jérémie Zimmermann, co founder of Quadrature du la Net and originally published in Mediapart.

“Fortunately, Edward Snowden also showed us a pathway out. Governments can maybe made accountable, and mass surveillance can surely be evaded, and made much more costly. By moving away from technology that controls us, we can use, promote and develop technology that makes us more free. It is a long path, requiring efforts, to break away with the habits and the blind trust we placed in the Machine, and requiring an appropriation of technology by everyone. Through the use of free software, decentralized architectures and end-to-end encryption, we can –probably– take back control of the Machine.”

One year ago, Edward Snowden’s revelations make us learn and understand how our relationship to technology has changed forever, and how the trust we place in machines shall never be the same. Edward Snowden also shows us a path for taking back control of the machines, an urgent task that no one today can ignore. By Jéremie Zimmermann, co-founder of La Quadrature du Net.

© Caption by Terminator Studies

One year ago day by day, a courageous young man named Edward Snowden sacrificed most of his life and his freedoms to show us the crude reality of the world we are living in. His ongoing revelations make us learn and understand how our relationship to technology has changed forever, and how the trust we place in machines shall never be the same. Edward Snowden also shows us a path for taking back control of the machines, an urgent task that no one today can ignore.

We live already in the era of the Cyborg. Our Humanities are practically indistinct from the Machine. Functions of our bodies such as communicating, remembering, recognizing each other, our personal and shared memories and most of our works are now indivisible from the functions of the machines.

Computers, phones and servers are all interconnected through software and communication networks. This global interconnected Machine is increasingly merging with our global interconnected humanity – soon on faces, wrists and under the skin – and so far most of us trusted it with about everything.

Yet in the era of the Cyborg, what we see thanks to Ed Snowden is that this global Machine has been turned as a whole against us. It has been turned as a tool for global surveillance and for control of individuals, at the cost of massive violations of our fundamental rights. With many abuses already demonstrated, the Machine bears an immense, horrendous, potential for abuse and repression, from political to economic espionage. Any political movement, any revolution, any idea could potentially be crushed in a snap.

The Machine as a whole has been repurposed. From obeying us, its users, its owners, it has been reprogrammed to obey its real masters, comprised of an ill-defined alliance of some of the biggest companies in the world such as Google, Apple, Facebook and Microsoft, of unaccountable spying agencies such as the NSA, GHCQ or the DGSE, and of thousands of their private or public partners (among which a myriad of private contractors and at least 950.000 US citizens cleared with a Top Secret clearance).

Many of us still find more comfortable to ignore the truth than to change their habits. Perhaps truth is so violent and scary that it becomes too difficult to admit. Perhaps the gap between reality and comfortable illusions is too big.

Still, we have an immense responsibility to ask ourselves questions that will shape the future of our societies, our relationship to power, as well as our relationships between individuals. Where is the boundary between our humanities and the Machine? Did we consciously accept it as it is? How can we take back control of that Machine, which is now part of ourselves?

What is at stake is the very definition of our humanities. For massive surveillance implies violation and potential annihilation of our intimacies, these spaces where we decide, in full trust –alone or with others– to be truly ourselves, to experiment with ourselves, to develop new ideas and theories, to write, sing and create. In these spaces we develop our identities, our very definitions of who we are…

Fortunately, Edward Snowden also showed us a pathway out. Governments can maybe made accountable, and mass surveillance can surely be evaded, and made much more costly. By moving away from technology that controls us, we can use, promote and develop technology that makes us more free. It is a long path, requiring efforts, to break away with the habits and the blind trust we placed in the Machine, and requiring an appropriation of technology by everyone. Through the use of free software, decentralized architectures and end-to-end encryption, we can –probably– take back control of the Machine.

It is our duty as a civilisation and as individuals. We must fight this Machine of oppression by all means, before it is too late, in order to reconquer and reclaim our humanity.


Posted in Activism, Anti-P2P, Cognitive Capitalism, Copyright/IP, Culture & Ideas, Empire, Featured Content, Featured Essay, Networks, Politics | 1 Comment »

Students are taking on neoclassical economics – and winning

photo of Stacco Troncoso

Stacco Troncoso
25th May 2014

Reposted from the New Economics Foundation website. Here, Alice Martin explores the rising concern about the preponderance of neoclassical economic models in higher education curricula, and what’s being done about it.

This is getting exciting.  With student groups across 30 countries now calling for change, it’s clear the campaign to reform university economics curriculums is reaching new heights.

Just last month the Executive Director of Financial Stability at the Bank of England, Andy Haldane, publically backed the students’ argument, agreeing it is high time “to rethink some of the basic building blocks of economics.” He added to their already sizeable list of high profile supporters, including economist of the day Thomas Piketty and renowned Cambridge scholar, Ha-Joon Chang.

What are they asking for?

The student movement is objecting to the dominance of neoclassical models of economics taught by the vast majority of university economics departments across the world: models that continue to promote profit-led decision making despite international financial instability and widening inequality.

Rather than being taught to regurgitate old theories, the student movement is calling for degrees that analyse and evaluate economic systems, decisions and models in a real world context. They object to the surrendering of political, social and environmental systems to financial markets, and want to study instead an economics that fulfils its real responsibility – answering how the world’s population can live well without further draining the planet’s resources.

The broader syllabus the students are proposing would address the major events that have shaped our current economic outlook, the most obvious of which being the 2008 financial crisis.  With the impact of the crisis still sending tremors through the economic stability of nations andhouseholds alike, it is crucial that rigourous, academic research into its causes is fostered. For this the students recognise a ‘pluralist’ approach is needed. This means a range of theories and schools of thought would be studied, instead of continuing the one theory fits all approach.

65 student groups, including those based in Oxford University and LSE here in the UK, and Jadavpur University in West Bengal, India, to name just three, have signed this open letter outlining their shared demands.

Why is this important for the rest of us?

Since the financial crash economics itself has been in crisis. With politicians pulling in different directions to try and rationalise what happened, most people have been left with no option but to soldier on with their own personal financial crises. MPs have pushed through austerity as a solution to the UKs national financial woes, despite the approach being based onwholly false economic grounds. And their damaging slight of hand has worked. Why? Because with bamboozling stock market figures and complicated national debt calculations, most people feel they have to leave economics to the ‘experts’.

But what happens when it turns out the experts don’t have all the answers? Just as we saw recently with the Bank of England’s welcome exposé onhow the modern monetary system works, economics is by no means a settled science.

This is why it’s so important that those embarking on degrees in economics are taught how to challenge the models and theories that aren’t working. And the message the students are sending out is that under the current curriculum, they are not able to do so.

Universities are listening

The University of Manchester have chosen not to renew the contract of a lecturer who set up an out-of-hours class ‘Bubbles Panics and Crashes’ to broaden the undergraduate syllabus. Despite this setback for the movement, other universities are starting to listen to the students’ calls. Kingston University last week released a statement in support of their demands “for genuine reform of economics education”. With other universities expected to follow suit, the student led action has the potential to make a profound change. A ripple effect through the financial industries is perhaps too far off to get excited about, but a reformed curriculum is certainly a bold first step.

For those keen to find out more about what changes are being proposed, the UK based student group Rethinking Economics are planning a public conference in London this June.  And the International Student Initiative for Pluralism in Economics (ISIPE) website has full details of the groups, and supporters involved.


Posted in Activism, Cognitive Capitalism, Collective Intelligence, Culture & Ideas, Economy and Business, P2P Education, Politics | No Comments »

When sharing isn’t caring

photo of Stacco Troncoso

Stacco Troncoso
24th May 2014

More perspectives on what a “sharing economy” entails - this time from Nathan Schneider, one of the editors of Waging Non-Violence. This article was originally published in Al-Jazeera.

In the beginning, there was sharing. That, at least, is the story according to Dominik Wind, a German environmental activist with a genial smile and a cycling cap whom I met in Paris while attending a conference earlier this month about the sharing economy. Years ago, out of curiosity, Wind visited Samoa for half a year; he found that people shared tools, provisions and even sexual partners with their neighbors. Less encumbered by industrial civilization, they appeared to share with an ease and forthrightness long forgotten in the world Wind knew back home.

Wind and I got to know each other while splitting a stranger’s apartment that we found through Airbnb. Thanks to platforms like this, sharing is on the rise in urban centers. Capitalism’s creative destruction may have ravaged our communities over the centuries with salvos of individualism, competition and mistrust, but now it wants to sell a sense of community back to us.

Online platforms are making it possible again for people to share resources such as cars, homes and time. As well as bringing people together, they’re a way to save money in a tepid economy.

Meanwhile, sharing has become a big business: Airbnb is now more valuable than Hyatt, and Zipcar, which leases cars by the hour, has been bought by the massive international car-rental company Avis Budget. The sharing economy is also changing the way we work. Crowdsourcing platforms such as Mechanical Turk “employ” hundreds of thousands of people to share their labor in the form of piecework — data entry, picking up packages, running errands — without expectation of protections or benefits.

Sharing could lead the way to a more sustainable society, one in which we consume less and collaborate more. But it could also be a means forBig Business to creep even more fully into our lives.

As these companies grow, so does their impact. Airbnb has been in legal battles with unions and hotel chains in New York over how to regulate its short-term apartment rentals. Street battles against Uber in Seattle have drawn attention to how car-sharing affects established taxi services and drivers. These are skirmishes in a broader struggle underway over the future of the sharing economy.

Sharing could lead the way to a more just and sustainable society, one in which we consume less and collaborate more. But it could also be a means for Big Business to creep even more fully into our lives, exploiting our relationships with one another and turning every attempt at generosity into an act of consumption.

Let’s talk about love

The conference that Wind and I attended in Paris was called OuiShare Fest, a genuinely festive event for the sharing movement held in a red circus tent, on an adjoining strip of AstroTurf and aboard a boat floating in the nearby canal de St.-Martin. This year’s theme, the Age of Communities, was broad enough to welcome all sides of the movement: venture capitalists alongside black markets,slow foodies alongside Bitcoin promoters. The first morning of the three-day event began with an invitation for everyone to stand up and hug three people around them.

The language of sharing spread across domains freely; a conversation about startups could quickly pivot to one about marriage or the universe. The same words came out over and over: “trust,” “community,” “network,” “passion,” “collaboration” and a good deal of “love.” (As a Brazilian entrepreneur put it, “Why don’t we talk about love in big companies?”) The event’s sponsors included Le Poste, France’s postal service; the retailer Castorama; Airbnb; a pair of French car-sharing companies; and inevitably, Google.

Less visible but very much present was a set of young activists with more idealism than funding, drawn to such topics as sustainable agriculture, protest movements and alternative currencies. For them, a desire to change the world for the better was almost obligatory; if you can make a bit of money in the process, all the better.

It wasn’t so clear, however, how far the industry they were building would bend toward social justice. Cooperative business models, which share profits among their participants, were alluded to only occasionally, more as aspiration than reality, during the main-stage talks. There were several nods to the idea of a guaranteed basic income. But the word “rights” — much less old-fashioned terms for confronting corporate rapacity like “boycott,” “strike” and “solidarity” — seldom came up. When the sharing evangelist and corporate consultant Rachel Botsman showed slides of Arab Spring crowds, those scenes served as an analogy, not a recommended course of action. She described sharers as “insurgents” against old-fashioned hierarchical businesses, engaged in “revolution,” “democratizing” and “disruption.”

Filling the vacuum

That last word, “disruption,” came up at OuiShare a lot. Just as Airbnb disrupted the hotel industry, sharing startups will strike many more industries in short order. Amid the general din of cheerfulness, there was a sense that the startup boosters and organic farmers alike expected an imminent and apocalyptic collapse of the economic establishment and that the triumphant future of sharing would naturally arise from its ashes.

What wasn’t discussed nearly as freely was the effect that the disruption of major industries might have on some of the most vulnerable members of society, those less well equipped than the entrepreneurial class to adapt. In one of the few tense moments on the main stage, New School professor Trebor Scholz challenged Botsman’s optimism about crowdsourcing, noting that such labor pays an average of only $2 to $3 per hour. “This is a total affront to what the labor movement has struggled for for centuries,” he said.

Unless better models are strenuously, creatively pursued, the corporate one will win by default.

No doubt, an economy built on sharing could reduce inequality. Sharing enables ordinary people to buy less, connect to one another more and keep the economic value they generate in their own communities. But sharing could also make us even more reliant on corporate whims, allowing companies to dictate how, why, when and what we share and extracting fees for themselves in the process. It depends on who winds up controlling the essential resources — from homes to Web servers to gardens — and who benefits from their use. Unless better models are strenuously, creatively pursued, the corporate one will win by default. In fact, it is winning already: The sharing sector of the conventional economy built on venture capital and exploited labor is a multibillion dollar business, while the idea of a real sharing economy based on cooperatives, worker solidarity and democratic governance remains too much of an afterthought. If the sharing movement really wants to disrupt economic injustice, these should be its first priorities.

On the OuiShare stage, Neal Gorenflo, a Bay Area–based founder of the nonprofit Shareable, likened the infusion of corporate business models into the sharing movement as “old wine in new skins.” Later he told me that companies like Airbnb and the ride-sharing platform Lyft used to be social enterprises but have since “gone from something transformative to something disruptive” — merely replacing one set of profiteers with another. Rather than building genuine trust and relationships through sharing, many such platforms create only an illusion of trust and community conjured on the Internet. Users get by with less, while venture capitalists rake in cash. The recent wave of protests against tech-driven gentrification in San Francisco is a sign to Gorenflo of where the corporate model leads. “People are starting to wake up to the fact that technology and innovation are increasing wealth inequality,” he said.

In the days before the conference, the Hotel de Ville in central Paris — the city’s administrative headquarters — was draped with red banners that proclaimed Global partage” — “Global sharing.” There were tents out front celebrating such possibilities as “le co-working,” “le couchsurfing” and “le crowdfunding.” One banner advised, “You too, go the way of sharing!” But the critical question was missing: Qui bénéficie? Who benefits?


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