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Archive for 'Cognitive Capitalism'

Trebor Scholz et al on Cooperative Alternatives to the Sharing Economy

photo of Michel Bauwens

Michel Bauwens
26th July 2015


This is really good panel on the necessary cooperative forms for the sharing economy:

““Given the mounting attention to the unethical labor practices in the so-called “collaborative sharing economy” with labor brokerages like Handy and Uber, what are the alternatives? Imagine for one moment that the algorithmic heart of any of these citadels of anti-unionism could be cloned and brought back to life under a different ownership model, with fair working conditions, as a humane alternative to the current model. There isn’t just one, inevitable future of work and while cooperatives are not a panacea for all the wrongs of platform capitalism, they could help to weave some ethical threads into the fabric of 21st century work.

In his introductory remarks, Trebor Scholz will discuss good digital labor and argue for what he calls platform cooperativism.

w/

* Sara Horowitz, Founder & Executive Director, Freelancers Union.
* Saket Soni, Director, National Guestworker Alliance, & New Orleans Workers’ Center for Racial Justice.
* Caroline Woolard, Artist, Co-Founder, TradeSchool and OurGoods
* Nathan Schneider, Reporter, Vice, The Nation, & The Chronicle of Higher Education.
* Douglas Rushkoff, Professor of Media Theory and Digital Economics, CUNY/Queens

Watch the video here:

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Posted in Cognitive Capitalism, Cooperatives, Ethical Economy, P2P Collaboration, P2P Infrastructures, Peer Production, Videos | No Comments »

Paul Mason on the emergence of Post-Capitalism

photo of Michel Bauwens

Michel Bauwens
21st July 2015


I believe it offers an escape route – but only if these micro-level projects are nurtured, promoted and protected by a fundamental change in what governments do. And this must be driven by a change in our thinking – about technology, ownership and work. So that, when we create the elements of the new system, we can say to ourselves, and to others: “This is no longer simply my survival mechanism, my bolt hole from the neoliberal world; this is a new way of living in the process of formation.

Excerpted from Paul Mason:

“Capitalism, it turns out, will not be abolished by forced-march techniques. It will be abolished by creating something more dynamic that exists, at first, almost unseen within the old system, but which will break through, reshaping the economy around new values and behaviours. I call this postcapitalism.

As with the end of feudalism 500 years ago, capitalism’s replacement by postcapitalism will be accelerated by external shocks and shaped by the emergence of a new kind of human being. And it has started.

Postcapitalism is possible because of three major changes information technology has brought about in the past 25 years. First, it has reduced the need for work, blurred the edges between work and free time and loosened the relationship between work and wages. The coming wave of automation, currently stalled because our social infrastructure cannot bear the consequences, will hugely diminish the amount of work needed – not just to subsist but to provide a decent life for all.

Second, information is corroding the market’s ability to form prices correctly. That is because markets are based on scarcity while information is abundant. The system’s defence mechanism is to form monopolies – the giant tech companies – on a scale not seen in the past 200 years, yet they cannot last. By building business models and share valuations based on the capture and privatisation of all socially produced information, such firms are constructing a fragile corporate edifice at odds with the most basic need of humanity, which is to use ideas freely.

Third, we’re seeing the spontaneous rise of collaborative production: goods, services and organisations are appearing that no longer respond to the dictates of the market and the managerial hierarchy. The biggest information product in the world – Wikipedia – is made by volunteers for free, abolishing the encyclopedia business and depriving the advertising industry of an estimated $3bn a year in revenue.

Almost unnoticed, in the niches and hollows of the market system, whole swaths of economic life are beginning to move to a different rhythm. Parallel currencies, time banks, cooperatives and self-managed spaces have proliferated, barely noticed by the economics profession, and often as a direct result of the shattering of the old structures in the post-2008 crisis.

You only find this new economy if you look hard for it. In Greece, when a grassroots NGO mapped the country’s food co-ops, alternative producers, parallel currencies and local exchange systems they found more than 70 substantive projects and hundreds of smaller initiatives ranging from squats to carpools to free kindergartens. To mainstream economics such things seem barely to qualify as economic activity – but that’s the point. They exist because they trade, however haltingly and inefficiently, in the currency of postcapitalism: free time, networked activity and free stuff. It seems a meagre and unofficial and even dangerous thing from which to craft an entire alternative to a global system, but so did money and credit in the age of Edward III.

New forms of ownership, new forms of lending, new legal contracts: a whole business subculture has emerged over the past 10 years, which the media has dubbed the “sharing economy”. Buzzwords such as the “commons” and “peer-production” are thrown around, but few have bothered to ask what this development means for capitalism itself.

I believe it offers an escape route – but only if these micro-level projects are nurtured, promoted and protected by a fundamental change in what governments do. And this must be driven by a change in our thinking – about technology, ownership and work. So that, when we create the elements of the new system, we can say to ourselves, and to others: “This is no longer simply my survival mechanism, my bolt hole from the neoliberal world; this is a new way of living in the process of formation.

During and right after the second world war, economists viewed information simply as a “public good”. The US government even decreed that no profit should be made out of patents, only from the production process itself. Then we began to understand intellectual property. In 1962, Kenneth Arrow, the guru of mainstream economics, said that in a free market economy the purpose of inventing things is to create intellectual property rights. He noted: “precisely to the extent that it is successful there is an underutilisation of information.”

You can observe the truth of this in every e-business model ever constructed: monopolise and protect data, capture the free social data generated by user interaction, push commercial forces into areas of data production that were non-commercial before, mine the existing data for predictive value – always and everywhere ensuring nobody but the corporation can utilise the results.

If we restate Arrow’s principle in reverse, its revolutionary implications are obvious: if a free market economy plus intellectual property leads to the “underutilisation of information”, then an economy based on the full utilisation of information cannot tolerate the free market or absolute intellectual property rights. The business models of all our modern digital giants are designed to prevent the abundance of information.

Yet information is abundant. Information goods are freely replicable. Once a thing is made, it can be copied/pasted infinitely. A music track or the giant database you use to build an airliner has a production cost; but its cost of reproduction falls towards zero. Therefore, if the normal price mechanism of capitalism prevails over time, its price will fall towards zero, too.

For the past 25 years economics has been wrestling with this problem: all mainstream economics proceeds from a condition of scarcity, yet the most dynamic force in our modern world is abundant and, as hippy genius Stewart Brand once put it, “wants to be free”.

There is, alongside the world of monopolised information and surveillance created by corporations and governments, a different dynamic growing up around information: information as a social good, free at the point of use, incapable of being owned or exploited or priced.

In these musings, not published until the mid-20th century, Marx imagined information coming to be stored and shared in something called a “general intellect” – which was the mind of everybody on Earth connected by social knowledge, in which every upgrade benefits everybody. In short, he had imagined something close to the information economy in which we live. And, he wrote, its existence would “blow capitalism sky high”.

With the terrain changed, the old path beyond capitalism imagined by the left of the 20th century is lost.

But a different path has opened up. Collaborative production, using network technology to produce goods and services that only work when they are free, or shared, defines the route beyond the market system. It will need the state to create the framework – just as it created the framework for factory labour, sound currencies and free trade in the early 19th century. The postcapitalist sector is likely to coexist with the market sector for decades, but major change is happening.

Networks restore “granularity” to the postcapitalist project. That is, they can be the basis of a non-market system that replicates itself, which does not need to be created afresh every morning on the computer screen of a commissar.

The transition will involve the state, the market and collaborative production beyond the market. But to make it happen, the entire project of the left, from protest groups to the mainstream social democratic and liberal parties, will have to be reconfigured. In fact, once people understand the logic of the postcapitalist transition, such ideas will no longer be the property of the left – but of a much wider movement, for which we will need new labels.

Who can make this happen? In the old left project it was the industrial working class. More than 200 years ago, the radical journalist John Thelwall warned the men who built the English factories that they had created a new and dangerous form of democracy: “Every large workshop and manufactory is a sort of political society, which no act of parliament can silence, and no magistrate disperse.”

Today the whole of society is a factory. We all participate in the creation and recreation of the brands, norms and institutions that surround us. At the same time the communication grids vital for everyday work and profit are buzzing with shared knowledge and discontent. Today it is the network – like the workshop 200 years ago – that they “cannot silence or disperse”.

True, states can shut down Facebook, Twitter, even the entire internet and mobile network in times of crisis, paralysing the economy in the process. And they can store and monitor every kilobyte of information we produce. But they cannot reimpose the hierarchical, propaganda-driven and ignorant society of 50 years ago, except – as in China, North Korea or Iran – by opting out of key parts of modern life. It would be, as sociologist Manuel Castells put it, like trying to de-electrify a country.

By creating millions of networked people, financially exploited but with the whole of human intelligence one thumb-swipe away, info-capitalism has created a new agent of change in history: the educated and connected human being.

This will be more than just an economic transition. There are, of course, the parallel and urgent tasks of decarbonising the world and dealing with demographic and fiscal timebombs. But I’m concentrating on the economic transition triggered by information because, up to now, it has been sidelined. Peer-to-peer has become pigeonholed as a niche obsession for visionaries, while the “big boys” of leftwing economics get on with critiquing austerity.

In fact, on the ground in places such as Greece, resistance to austerity and the creation of “networks you can’t default on” – as one activist put it to me – go hand in hand. Above all, postcapitalism as a concept is about new forms of human behaviour that conventional economics would hardly recognise as relevant.

So how do we visualise the transition ahead? The only coherent parallel we have is the replacement of feudalism by capitalism – and thanks to the work of epidemiologists, geneticists and data analysts, we know a lot more about that transition than we did 50 years ago when it was “owned” by social science. The first thing we have to recognise is: different modes of production are structured around different things. Feudalism was an economic system structured by customs and laws about “obligation”. Capitalism was structured by something purely economic: the market. We can predict, from this, that postcapitalism – whose precondition is abundance – will not simply be a modified form of a complex market society. But we can only begin to grasp at a positive vision of what it will be like.

I don’t mean this as a way to avoid the question: the general economic parameters of a postcapitalist society by, for example, the year 2075, can be outlined. But if such a society is structured around human liberation, not economics, unpredictable things will begin to shape it.

Today, the thing that is corroding capitalism, barely rationalised by mainstream economics, is information. Most laws concerning information define the right of corporations to hoard it and the right of states to access it, irrespective of the human rights of citizens. The equivalent of the printing press and the scientific method is information technology and its spillover into all other technologies, from genetics to healthcare to agriculture to the movies, where it is quickly reducing costs.

The modern equivalent of the long stagnation of late feudalism is the stalled take-off of the third industrial revolution, where instead of rapidly automating work out of existence, we are reduced to creating what David Graeber calls “bullshit jobs” on low pay. And many economies are stagnating.

The equivalent of the new source of free wealth? It’s not exactly wealth: it’s the “externalities” – the free stuff and wellbeing generated by networked interaction. It is the rise of non-market production, of unownable information, of peer networks and unmanaged enterprises. The internet, French economist Yann Moulier-Boutang says, is “both the ship and the ocean” when it comes to the modern equivalent of the discovery of the new world. In fact, it is the ship, the compass, the ocean and the gold.

The modern day external shocks are clear: energy depletion, climate change, ageing populations and migration. They are altering the dynamics of capitalism and making it unworkable in the long term. They have not yet had the same impact as the Black Death – but as we saw in New Orleans in 2005, it does not take the bubonic plague to destroy social order and functional infrastructure in a financially complex and impoverished society.

Once you understand the transition in this way, the need is not for a supercomputed Five Year Plan – but a project, the aim of which should be to expand those technologies, business models and behaviours that dissolve market forces, socialise knowledge, eradicate the need for work and push the economy towards abundance. I call it Project Zero – because its aims are a zero-carbon-energy system; the production of machines, products and services with zero marginal costs; and the reduction of necessary work time as close as possible to zero.

Most 20th-century leftists believed that they did not have the luxury of a managed transition: it was an article of faith for them that nothing of the coming system could exist within the old one – though the working class always attempted to create an alternative life within and “despite” capitalism. As a result, once the possibility of a Soviet-style transition disappeared, the modern left became preoccupied simply with opposing things: the privatisation of healthcare, anti-union laws, fracking – the list goes on.

If I am right, the logical focus for supporters of postcapitalism is to build alternatives within the system; to use governmental power in a radical and disruptive way; and to direct all actions towards the transition – not the defence of random elements of the old system. We have to learn what’s urgent, and what’s important, and that sometimes they do not coincide.

The power of imagination will become critical. In an information society, no thought, debate or dream is wasted – whether conceived in a tent camp, prison cell or the table football space of a startup company.

As with virtual manufacturing, in the transition to postcapitalism the work done at the design stage can reduce mistakes in the implementation stage. And the design of the postcapitalist world, as with software, can be modular. Different people can work on it in different places, at different speeds, with relative autonomy from each other. If I could summon one thing into existence for free it would be a global institution that modelled capitalism correctly: an open source model of the whole economy; official, grey and black. Every experiment run through it would enrich it; it would be open source and with as many datapoints as the most complex climate models.

The main contradiction today is between the possibility of free, abundant goods and information; and a system of monopolies, banks and governments trying to keep things private, scarce and commercial. Everything comes down to the struggle between the network and the hierarchy: between old forms of society moulded around capitalism and new forms of society that prefigure what comes next.

Is it utopian to believe we’re on the verge of an evolution beyond capitalism? We live in a world in which gay men and women can marry, and in which contraception has, within the space of 50 years, made the average working-class woman freer than the craziest libertine of the Bloomsbury era. Why do we, then, find it so hard to imagine economic freedom?

It is the elites – cut off in their dark-limo world – whose project looks as forlorn as that of the millennial sects of the 19th century. The democracy of riot squads, corrupt politicians, magnate-controlled newspapers and the surveillance state looks as phoney and fragile as East Germany did 30 years ago.

All readings of human history have to allow for the possibility of a negative outcome. It haunts us in the zombie movie, the disaster movie, in the post-apocalytic wasteland of films such as The Road or Elysium. But why should we not form a picture of the ideal life, built out of abundant information, non-hierarchical work and the dissociation of work from wages?

Millions of people are beginning to realise they have been sold a dream at odds with what reality can deliver. Their response is anger – and retreat towards national forms of capitalism that can only tear the world apart. Watching these emerge, from the pro-Grexit left factions in Syriza to the Front National and the isolationism of the American right has been like watching the nightmares we had during the Lehman Brothers crisis come true.

We need more than just a bunch of utopian dreams and small-scale horizontal projects. We need a project based on reason, evidence and testable designs, that cuts with the grain of history and is sustainable by the planet. And we need to get on with it.”

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Posted in Cognitive Capitalism, Commons Transition, P2P Subjectivity, P2P Theory | No Comments »

The Real Question of the Referendum: The Enclosure of the Greek Commons

photo of Vasilis Kostakis

Vasilis Kostakis
4th July 2015


Hand

Being a typical academic, allow me to begin with a definition: the commons is a term used to describe shared resources (such as land, water, air, culture, science, infrastructures) in which each stakeholder has an equal interest.

The devastating enclosures of the English commons, between 16th and 19th centuries, has been labeled as the “revolution of the rich against the poor” by the eminent political economist Karl Polanyi. They forced peasants into the labor market and the factories of the industrial revolution and “marked the beginning of a worldwide process of commodifying the land, ocean, and atmosphere of the earth”.

So, what is the relevance of the loss of the English commons with the imminent Greek referendum?

Much discussion has been taking place around the meaning of a question posed in a relatively technical language. To put the matter bluntly, I would like to argue that the real question of the referendum is whether Greek citizens approve or disprove the enclosure of their commons. The proposed changes in the pension, taxing, labour and insurance systems are supposedly aimed at ensuring that Greece can service its foreign debt. However, these are not the biggest perils although they fill most of the pages of the notorious document the Greeks are called to approve or disprove.

In short, on page 17, the creditors suggest that Greece irreversibly privatizes its airports, harbors, railways, water supply and sewerage companies, energy infrastructures and public power corporations, motorways, post offices, thermal springs, cultural treasures and other properties (seaside land, marinas etc). These are assets which we have inherited or jointly created and, instead of delivering them intact or even enhanced to the next generations, we are called, under the pressure of an economic collapse, to sell them off to the rich. In addition, no hybrid forms of public-private partnership are explicitly mentioned (for instance, OTE, a profitable telecommunication public-private corporation, is to be entirely privatized).

Conditions in Greece today are not only reminiscent of those in Germany in 1933, as Prof. Sachs writes, but also of those in 16th-19th century England and Wales. Another revolution of the ultra-rich is taking place and the endgame playing out between Greece and its creditors might be only the beginning of a new global wave of enclosures.

Crisis


Vasilis Kostakis is Senior Research Fellow at the Ragnar Nurkse School of Innovation and Governance (TUT), longtime collaborator of the P2P Foundation, and member of the CommonsTransition Team.

Images: (Top) (Bottom) by OpenSource.com

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Posted in Activism, Anti-P2P, Cognitive Capitalism, Commons, Commons Transition, Economy and Business, Empire, Original Content, P2P Rights, Politics | No Comments »

OuiShare Fest Finds Itself While Lost in Transition

photo of Stacco Troncoso

Stacco Troncoso
14th June 2015


Ouife_n

Originally published in Shareable, Neal Gorenflo shares his impressions of OuiShare Fest 2015


The third annual OuiShare Fest, hosted with the theme “Lost in Transition” in Paris’ charming Cabaret Sauvage, concluded last Friday. This unique gathering of sharing economy leaders from around the world found itself in at least two ways with their latest edition.

First, the theme brought the elephant in everybody’s room to the fore – the gaping contradiction between the utopian possibilities and the hyper-capitalist realities of the sharing economy. The key dilemma that OuiShare Fest underscored is that while leading platforms like Airbnb and Uber help users create value on an unprecedented scale, they do not share ownership and governance with users and could in fact exacerbate already severe inequalities. OuiShare Fest’s programming, which is largely crowdsourced, reflected a widely held belief that platforms should share ownership and governance with those most responsible for their success — users.

Instead of withering from this heat of this contradiction, the organizers held it. A remarkable number of sessions focused or touched on this contradiction (Ann Marie of Goteo blogged this contradiction in detail). While there were sessions that featured sharp criticism of the sharing economy, most sessions explored solutions to the contradiction, like using the blockchain to share ownership and governance with millions of users.

In fact, Nick Grossman’s keynote, “Venture Capital vs. Community Capital,” was OuiShare Fest in a nutshell. He elegantly articulated the contradiction and put forward the blockchain as a key solution. As Nathan Schneider pointed out last December in his Shareable feature story, “Owning is the New Sharing,” criticism of the sharing economy has catalyzed a counter-movement to create democratic sharing economy platforms. With Nick’s help, the blockchain had its coming out party at OuiShare Fest as the people-power solution to the sharing economy’s contradictions. Everybody was talking about the blockchain from keynotes to side conversations.

Whether or not the blockchain will live up to these expectations is another question. I have my doubts as it doesn’t build durable social relations necessary for communities to go on a new, long-term commons-based developmental path. Blockchain platforms are thin, and so are the social ties. There are no shortcuts, technological or otherwise, to social change. Social change is social, and social takes time. But there’s hope, as Swarm shared its recently released Distributed Collaborative Organization at the fest, a format that combines blockchain and human management of enterprises.

The second way OuiShare Fest found itself is that it seems all grown up in its third year. Things ran more smoothly, it was amply staffed with volunteers, it had all the trimmings of a professionally run conference, yet its organization reflected OuiShare’s values. With OuiShare Fest, OuiShare the organization talks the collaboration talk and walks the collaboration walk, a rare accomplishment. The fest is run in a largely decentralized fashion.

That said, I did come away with the impression that OuiShare Fest’s format and audience may be mismatched. As CrowdCompanies’ founder Jeremiah Owyang commented on Facebook, OuiShare Fest is a community of insiders, meaning it convenes the actors within the sharing economy, not the general public. To mature further, OuiShare Fest may need to create a better balance between keynotes and collaboration. FAB10, the gathering of FabLab leaders, might be a model to emulate. It’s really two events — a symposium for insiders and a festival for the public.

This model would make more sense for us at Shareable. As someone who reads about the sharing economy nearly every day, I didn’t learn much from the formal programming. It would have been great for newbies, however. OuiShare Fest would be more useful to us as an opportunity to convene stakeholders in the Sharing Cities Network. While I was delighted to give an update to a packed house on sharing cities with Nils Roemen of Sharing City Nijmegen and Harmen van Sprung of Sharing City Amersterdam, the three of us would have preferred to use this rare time together to push our work forward. I heard similar things from other attendees.

Thankfully, none of this diluted the best part of OuiShare Fest, the community spirit that brings out the best in attendees. Simone Cicero of Sharitories described the OuiShare Fest as “TED hugs Burning Man.” Like Burning Man, the fest gives attendees the opportunity to try on a new way to be in the world and relate to others.

As such, I had many encounters that exemplified the spirit of sharing, generosity, and love at OuiShare Fest. For example, on day one, Julie Da Vara and Valentine Philipponneau of JeLoueMonCampingCar, a camper van sharing platform, gave me a box of canales, Bordeaux-style cupcakes that are sinfully delicious. Johanna Steuth of Wirfel gave me a compliment card with the inscription, “For your passion for commons, communities and creating places for sharing. I like to see you there!” Ronald van den Hoff, Marielle Sijgers, and Vincent Ariens of Seats2Meet treated a bunch of us including Jen Billock of Couchsurfing and Christian Iaione of LabGov to dinner at a classic Parisian café across from the opera house. My friends Laurel and Quitterie of BioHacking Safari invited me to a lovely dinner of modern Sicilian food at DJoon. Chelsea Rustrum of It’s a Shareable Life and I livened up things at Mangopay’s party by dragging everyone onto the dance floor. Entrepreneur Daniel Goldman treated me, Tom Llewellyn, Chelsea, Benita Matofska, and her team at People Who Share to late night karaoke. And at the conference-ending OuiShare Love party, David We and I went below the surface in a conversation that revealed a similar need to connect authentically with others. It was the perfect way to end the fest – feeling totally accepted for who I am and we are, warts and all, ready to take OuiShare love out into the world.

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Posted in Activism, Cognitive Capitalism, Commons, Conferences, Culture & Ideas, Ethical Economy, Events, Guest Post, P2P Development, Sharing | No Comments »

Hacking Financial Markets For the Common Good…?

photo of Guy James

Guy James
11th June 2015


Being involved with FairCoop has piqued my interest in the direct use of finance for activist means, and reading Brett Scott’s excellent “The Heretic’s Guide to Global Finance: Hacking the Future of Money”I have become aware of various attempts to do just that. Whereas FairCoop (and the related cryptocurrency Faircoin) seek to establish a parallel financial ecosystem based around social justice and fair trade, there are other projects attempting to ‘hack’ the mainstream financial system in order to use it as a means to increase equality in the world rather than, as generally seems to be the case on looking around me, to substantially decrease it.

I recently had a sort of vision of what could be possible when I recalled seeing a timelapse video of Dubai growing out of the desert nothingness into a large city within just over a decade. This is evidently due to two things: oil and capital investment and speculation in oil. Whatever one thinks of Dubai, when looked at on the macro level this kind of growth has a miraculous quality to it, showing that there is nothing humanity cannot accomplish when we really put our minds (and our money) to it. Imagine the same kind of breakneck growth being applied to putting solar panels on roofs, switching cars to renewable energy, converting the armies of the world to disaster relief outfits, building solar desalination plants and hydroponic vertical farms, regenerating cities like Detroit which have been abandoned by traditional capitalism… yes all of this at present is ‘pie in the sky’ idealism, yet all of this is becoming more and more of a necessity.

Can it be that the power to really transform our planet lies right in the ‘belly of the beast’, in the financial system? For too long activists have turned away and self-righteously chosen to demonise this power. Any Jungian knows that when one turns away from a great dark power, it has the distinct tendency to devour one – and this is of course what is happening. We need to shine a light on the system, and as Brett Scott suggests, infiltrate it – here’s an excerpt from his book:

DAS KAPITAL LLP: GOING LONG THE REVOLUTION WITH MARX’S HEDGE FUND

In 2011 the Guardian blogger Joris Luyendijk quoted me as saying ‘Karl Marx would have made a fantastic hedge fund manager.’ It predictably caused howls of outrage in the comments section, but I never meant it in a literal sense. I was suggesting that the best hedge fund managers are characterised by a certain disruptive tendency, an ability to cut through herds of conventional investors. This is not to romanticise hedge funds, but deploying money into a situation is similar to making a statement of belief- if your money goes against the herd, it’s a bit like saying ‘up yours’ to them. There are even hedge funds that set themselves up as ‘corporate raiders’ or ‘activist funds’ that deliberately challenge company management.
[…]

Activating the Financial Drag Queens

[…]Why isn’t there an Amnesty International LLP, gradually buying up stakes in companies with poor human rights records, demanding accountability while using the dividends to fund the dissent? For many NGOs, part of the answer is lack of funds, and the rest is ideological opposition to the idea. The financial system though, like the internet, is a networked technology of power which can be used in unusual ways. If you feel authorities and large corporates are dominating the internet with patents, firewalls and intellectual property lawsuits, you don’t turn off the wireless, you get creative. Who’s to say that we can’t wear the garb of a notorious financial institution in a heretical fashion.

A friend of mine who worked for 12 years in an investment bank had an idea of starting a hedge fund that would attempt to extract money from the oil sector and redirect it to the renewable energy sector. It’s interesting in principle, but incredibly hard to execute in reality. It’s important to take these ideas with a pinch of salt. Perhaps the point of an activist hedge fund is not actually to work in a conventional sense, but rather to create publicity, to learn, and to act as a subversive ‘drag queen’ joker bending the rules. On the other hand, so few people have experimented with the idea of creating subversive hedge funds that it’s hard to know what the potential might be. The only way of finding out if the dynamics of trading can be harnessed in a positive way is to experiment boldly. There is nothing to lose … except money.

He gives some examples of existing hedge funds which go against the grain:

Well-known examples include:

  • The Children’s Investment Fund: A fund started by Chris Hohn. In 2012 it launched a campaign against Coal India’s directors, suing them for breaching fiduciary duty (aka ignoring shareholders). They have an attached charity which receives a portion of the firm’s profits.
  • Greenlight Capital: A fund run by a poker-playing manager called David Einhorn which publicly bets against firms, much to their annoyance.
  • Carl Icahn: A corporate raider famed for terrorising corporate management teams. He views himself as a predator on a mission to destroy complacent CEOs: On his website,icahnreport.com, he quotes himself as saying ‘A lot of people die fighting tyranny. The least I can do is vote against it.’
  • Dan Loeb: A hedge fund manager infamous for buying stakes in companies and then writing incendiary letters of withering scorn to the company management teams.
  • Others, such as Pirate Capital, have been less successful, but are based on similar principles. Could it be that the mindset of a hedge fund manager can be strikingly similar to that of a campaigner? Certainly, the belief systems of hedge fund managers are expressed in financial direct action, albeit mostly for their own gain. Could campaigners battle it out in this realm too, by setting up truly activist hedge funds?

Looking into these funds gives a sense of what might be possible, although as Scott notes, the main raison d’etre of most of them does seem to be to enrich themselves, albeit by going about it in an unconventional way. However it does show that the financial world is not necessarily the ‘black box’ or ‘old boys’ club’ that many activists seem to believe it to be (of course many parts of it do indeed answer to those descriptions).

The Robin Hood Minor Asset Fund has already been featured on this blog and it might be this fund which is the pioneer for a new way of interacting with financial markets for social justice. The fund is set up as a cooperative which anyone, for the modest layout of €30 to become a member plus €30 for their first share in the coop, can join. All members have voting rights and can choose to share with commons-oriented projects any dividend they receive from the activities of the cooperative on the stock markets. This is a way of directly using the power of financial markets to empower the commons.

Other more overtly activist groups have been developing interactions with the financial world, such as Platform London and their Take The Money And Run event, designed to showcase how big fossil fuel and financial corporations attempt to ‘artwash’ themselves by sponsoring galleries and other artistic events.

Can we imagine a ‘Stock Market of the Commons’ in a decade’s time? Free trade hedge funds? Scores of activist shareholders insisting that companies do the right thing by the planet and ALL its people, not just privileged elites?

“The possible has been tried, we need to try the impossible”, as the great Sun Ra used to say…

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Posted in Activism, Cognitive Capitalism, Commons, Commons Transition, Ethical Economy, P2P Money | No Comments »

Richard Stallman on “Intellectual Property”

photo of Guy James

Guy James
30th May 2015


I know Stallman is not everyone’s cup of tea but he does have a way of breaking down apparently complex issues so that they can be easily understood. And once you have read his opinions about so-called ‘Intellectual Property’, you may start to wonder how we ever came to lump together three disparate concepts under one heading (hint: it benefits large corporations):

It has become fashionable to toss copyright, patents, and trademarks—three separate and different entities involving three separate and different sets of laws—plus a dozen other laws into one pot and call it “intellectual property”. The distorting and confusing term did not become common by accident. Companies that gain from the confusion promoted it. The clearest way out of the confusion is to reject the term entirely.

Read more here: ‘Did You Say “Intellectual Property”? It’s a Seductive Mirage’

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Posted in Activism, Cognitive Capitalism, Copyright/IP, Open Access | No Comments »

How to Rein in Monopoly-like Network Platforms?

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David Bollier
27th May 2015


fatcat_1-web

The latest issue of Boston Review has a lively forum on the growing power of network-based businesses such as Amazon, Uber and Airbnb.  These companies may not be monopolies in the strict conventional sense of the law, but they nonetheless use their market dominance and network platforms to extract all sorts of advantages from competitors, suppliers and consumers.

K. Sabeel Rahman, a professor at Brooklyn Law School, presented his assessment of the situation, and then nine people of various persuasions (including me) responded.  Rahman stated the problem succinctly:

The kinds of power that Amazon, Comcast and companies such as Airbnb and Uber possess can’t be seen or tackled via conventional antitrust regulations.  These companies are not, strictly speaking, monopolies; Urban and Airbnb, in particular, do not engage in the kind of price-fixing or market dominance that is the usual target of antitrust regulation today.  These companies are better understood as platforms or utilities:  they provide a core, infrastructural service upon which other firms, individuals and social groups depend.

The problem is that conventional antitrust regulation isn’t really equipped to deal with information economy platforms, which tend to connect buyer and sellers in more efficient ways while offering very low prices. What’s the problem with that? Well, the problem is open networks paradoxically result in “power law” outcomes in which a minority of players tend to dominate the universe of users. Some companies have used this network-based advantage to limit competitors’ access to the market, impose unfair conditions on consumers or producers, and evade consumer and labor-rights laws. 

Rahman calls for a re-purposing of Progressive era policies from a century ago that tamed large monopolies like railroads by subjecting them to public utility regulation. Is this the way to go? Juliet Schor of Boston College agrees that there is a problem, but considers the regulatory approach nostalgic and unimaginative. She argued:

“Peer-to-peer structure and peer ownership of capital undermine the argument for private ownership of platforms and, by extension, for the public utility model.  This is not to say there isn’t a strong public interest in this sector – there is.  But the compelling feature of these entities is that most of the value in the market is produced by the peers, not the platforms.  This suggests that platforms can and should be owned and governed by users.  If they are, we can worry less about rent extraction, concentrations of political power, and the other concerns Rahman raises.”

Economist Dean Baker of the Center for Economic and Policy Research is similarly skeptical of a return to conventional utility regulation. He argues that companies like Amazon and Uber should simply be forced to observe the same laws that their smaller, conventional competitors do – such as paying the same sales tax, paying observing the same minimum wage and hour rules for drivers, and adhering to safety and health standards.

Here are some excerpts from my response (link to full statement is here), in which I suggest that “innovative schemes for cooperative self-provisioning and decentralized local control, also known as the commons,” can act as an antidote to market power:  “All sorts of quasi-autonomous, user-managed systems can provide shared rights of access outside the dominant market system and conventional government, [and] can mitigate the problem of network-based monopolies while mobilizing a diverse and politically consequential constituency.”

My brief note response continues:

….the rapidly diversifying world of open design and manufacturing holds promise for “out-cooperating” such companies in electronics, furniture, farm equipment, and other industries. Arduino is a vast global community of open source computer boards at the heart of wearable technologies, 3D printers, drones, and consumer electronics. The open design Wikispeed car gets a hundred miles per gallon of fuel, and the volunteers building it are pioneering new manufacturing techniques. The Farm Hack community has produced dozens of models of affordable farm equipment. The Open Prosthetics Project is designing innovative body limbs that major medical suppliers lack the creativity or profit incentive to develop. The recurrent theme: globally shared modular design that can be manufactured locally and inexpensively.

I do not wish to suggest that technology can solve all the problems of dysfunctional politics and policy. We still need government to use the antitrust and regulatory tools in its arsenal, and we would benefit from a resurgence of Progressive reform. But in the commons, individuals and groups collaborate in ways that, over time, can help remake our politics and policy. We saw a glimpse of this in the campaign for net neutrality, as a motley swarm of digital communities committed to an open Internet improbably prevailed (for now) over the cable and telecom giants, including Comcast.

As part of the forum there are also comments by Adam Thierer, a libertarian-minded tech policy expert at the Mercatus Center (“public utility regulation has discouraged competition and innovation”); Robin Chase, the cofounder of Zipcar (peer producers should share power and the value they create); and Arun Sundararajan of the Social Cities Initiative at NYU (rethink government’s role in the market); Sofia Ranchordas of Yale Law School (platform benefits are overstated); Mike Konczal of the Roosevelt Institute (try worker cooperatives); and Richard White, an author about railroads (historical perspectives on Gilded Age reforms).

It’s great that there is a new dialogue in a prominent magazine about how regulatory approaches for abusive market power need to be reinvented for the digital age. The comments are insightful, but the outlines of a new regulatory structure that could be effective, politically achieveable and mindful of network dynamics, remain elusive.


Originally published at bollier.org
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Posted in Cognitive Capitalism, Commons, Commons Transition, Economy and Business, Ethical Economy, Featured Essay, Original Content, P2P Collaboration, P2P Labor, Politics | No Comments »

How friendship became a tool of the powerful

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Kevin Flanagan
9th May 2015


An extract from an article by at the Guardian – http://www.theguardian.com/media/2015/may/07/how-friendship-became-tool-of-powerful

“In reducing the social world to a set of mechanisms and resources, the question repeatedly arises as to whether social networks might be redesigned in ways to suit the already privileged. Networks have a tendency towards what are called power laws, whereby those with influence are able to harness that power to win even greater influence.

One example of this is known as “emotional contagion”. Psychologists working with social analytics can now track the spread of positive and negative emotions, as they travel through social networks. This was the topic of Facebook’s controversial experiment using newsfeed manipulation, the results of which were published last summer. Different moods, including anger and depression, are now recognised to be more socially contagious than others. But what will we do with this knowledge? The anxiety, as social life becomes swept up by quantitative analysis, is that happy, healthy individuals might tailor their social relationships in ways that protect them against the “risk” of unhappiness. Guy Winch, an American psychologist who has studied this phenomenon, advises happy people to be on their guard. “If you find yourself living with or around people with negative outlooks,” he wrote on the website Psychology Today, “consider balancing out your friend roster.” The impact of this rebalancing on those unfortunate friends with the “negative outlooks” is all too easy to imagine.

The fabric of social life is now a problem that is addressed within the rubric of health policy, and there is something a little sad about that. Loneliness now appears as an objective problem, but only because it shows up in the physical brain and body, with calculable costs for governments and health insurers. Generosity and gratitude are urged upon people by positive psychologists, but mainly to alleviate their own mental health problems and private misery. And friendship ties within poor inner-city neighbourhoods have become a topic of government concern, but only to the extent that they mediate epidemics of bad nutrition and costly inactivity.

The irony is that, for all the talk of giving and sharing, this is potentially an even more egocentric worldview than that associated with the market. The cornerstone of orthodox economics, dating back to Adam Smith, is that self-interest in the marketplace is ultimately beneficial for society. The era of social optimisation looks set to stand this claim upside down: being social in your everyday life is worth it, because it will ultimately deliver benefits back to you. The trouble is that our appetites for this new commodity can spiral out of control.”

Continue to the Full Article – http://www.theguardian.com/media/2015/may/07/how-friendship-became-tool-of-powerful

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Posted in Cognitive Capitalism, Economy and Business, P2P Healthcare, P2P Public Policy, Sharing | No Comments »

Reclaiming the ‘real’ sharing economy

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Rajesh Makwana
25th April 2015


Romantic Heart from Love Seeds
What does it actually mean ‘to share’? This might seem like an obvious question, but the concept of sharing is increasingly being debated, discussed and redefined in our modern age of rapid technological change and planetary crises.


The rise of the sharing economy in recent years has given particular impetus to this debate, in which many academics are now analysing how sharing is a conflated economical concept that has been co-opted by corporate interests. It’s interesting to observe how savvy young progressives are resisting against this trend, while many social activists and environmentalists are beginning to chart a new direction for (and entirely new understanding of) the sharing economy – not as a profit-oriented business model, but as a potentially transformative mode of social exchange and economic activity.

For example, a community-building innovator based in New York, Lee-Sean Huang, has coined the term #WeWashing to help identify and critique the abuse of terms like “sharing”, “community” and “we”, which are often debased through online technology platforms or manipulated by corporate marketing techniques. Yet these words are meaningful, writes Huang, and “reminders that we are part of something greater than ourselves. As community members and citizens, we share common bonds and common interests. We are more than consumers.” Huang therefore argues that we need to “preserve the meaning of altruistic sharing and the bonds of community beyond narrowly-defined economic transactions”.

In a similar vein, the environmental news and commentary site Grist recently published a new series on “the real sharing economy”, asserting that sharing “has been appropriated and stripped of all meaning by people trying to sell you things, much like sustainability was.” In contrast, ‘real’ sharing goes far beyond “profit-seeking smartphone apps for unregulated taxi services (Uber) and vacation rentals (Airbnb)”, and could allow “humanity as a whole to consume less, hopefully shrinking our economy’s voracious appetite for materials and energy.”

An article by Sam Bliss at Grist gives a neat overview of how sharing can help us achieve economic degrowth in consumption and production, while “maintaining quality of life, or even improving it with more social interactions and stronger community relationships”. A real sharing enterprise, he argues, is not driven by profits for shareholders but wider concerns of equity, fairness and worker participation. He also acknowledges the potential of sharing wealth and power on a bigger scale, which is the only way to decrease global inequality, achieve true social justice, or fix a broken political system dominated by vested interests.

He even goes on to cite STWR’s report that explains how, in his words, “sharing can be the idea that brings together social, economic, and ecological movements in a grand alliance. Imagine Black Lives Matter, the fossil fuel divestment crusade, and the smoldering embers of Occupy joining forces to fight for a real sharing economy.”

No doubt the divergent perspectives on economic sharing will be openly debated at the upcoming Ouishare Fest 2015 in Paris, which has a wide variety of speakers from Charles Eisenstein, Michel Bauwens and Rob Hopkins to Lisa Gansky, Arun Sundararajan and Jeremiah Owyang (as well as a panel discussion with STWR on the environmental impacts of collaborative consumption – not to be missed for anyone attending!).

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Posted in Anti-P2P, Cognitive Capitalism, Commons, Culture & Ideas, Economy and Business, Ethical Economy, Original Content, P2P Business Models, P2P Collaboration, Politics, Sharing | No Comments »

Benkler on the Uber-ification of Services

photo of David Bollier

David Bollier
24th April 2015


Yochai Benkler

Harvard law professor Yochai Benkler gave attendees at the World Economic Forum in Davos a dire warning about future instability if the “Uber-ification of all services” continues.  In his intense six-minute talk, “Challenges of the Sharing Economy,” Benkler notes how open networks and collaborative production models have led to the “destabilization of the firm,” and ultimately threaten to bring about “the potential reorganization of the entire services sector.”

In light of this epochal shift, he declares, the critical question is: “Will [this shift] allow embedding economic production in the same kind of social solidarity trust models that we saw with the emergence of Wikipedia? Or will the externalization of risk onto the people formerly known as employees create severe disruption?”

The big challenge today, he argued, is that the social and the political have diverged, as demonstrated by the Occupy movement. And this leads to worrisome social pressures that the political system is disinclined to address.

I realize that Benkler must have been under a strict time limit — he was talking quite rapidly for this talk — but it sure would be nice to hear his proposed solutions for re-integrating the social and the political in functional ways, and how he proposes moving that agenda forward.  But at least the Davos crowd was alerted to this fundamental political challenge. Whether they will deign to recognize the issue and move beyond their adulation for the Uber, Airbnb and other lucrative forms of network monopoly is another matter.

While most people think that answers can only come from Washington, D.C. — FCC regs, antitrust law, etc. — rots of ruck on that, for all the obvious reasons.  I think the only effective solutions will come from P2P architectures and legal innovations that technically and legally stymie the consolidation of services by a single, dominant network player. Neither Congress, regulatory agencies or the courts are capable — politically or intellectually — of delivering satisfactory answers, I fear. The natural “power law” outcome of networks will ineluctably prevail unless some sort of intervention is made.  And if the answer is not going to involve social disruption, as Benkler warns, it’s high time that we begin to address challenges of legitimate, responsive, accountable governance in the network age.


Originally published in bollier.org

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Posted in Anti-P2P, Cognitive Capitalism, Crowdsourcing, Culture & Ideas, Economy and Business, Networks, Original Content, P2P Development, Peer Production, Politics | No Comments »