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The Demonetization Agenda – replacing transactions with social relations

photo of Michel Bauwens

Michel Bauwens
3rd September 2013


Republished from Stefan Meretz:

“The question of how we deal with and act within the given monetary environment is crucial for the commons movement, since the monetary logic and the commons logic are opposites. Contrary to the claims of mainstream economics, money is not neutral or simply an informational means for mediating transactions. Thus, replacing currencies with alternative currencies of different designs basically does not change the underlying monetary logic. It amounts to changing the tools while keeping the workshop.

The core element of the monetary logic is equivalent exchange and a codified set of social power relationships. It demands that »you get something only if you give something back.« This underlying logic creates relationships of guilt and subordination, as anthropologist David Graeber has convincingly shown in his history of credit over the course of human history.

The demonetization approach aims at reducing the necessity of using money both within our own commons relations and with respect to the outside »normal« market logic. It aims at strengthening social relationships instead of improving transactions, as Silke Helfrich has put it. While transactions always enforce direct reciprocities that link giving with taking, commons is about commoning – a more open, flexible system for freely determining the rules of interaction and distribution of the wealth we produce.

It is a fallacy to assume that designing an alternative currency is a form of commoning (or commoneering) because it only changes the tools, not the workshop. The social operations inscribed in the tools remain the same: performing transactions. Thus alienation is inherent in both conventional currencies as well as in alternative or complementary ones. If we want to gain self-determination we have to break with money, and if we want to break with money we have to break with direct, reciprocal exchange.

On the operational level demonetization requires that projects be carefully designed. As a general guideline projects should strive to decouple the inner social process of commoning from the the logic of transactions with “outsiders.” This means, for instance, that commoners should not resort to selling commons products on the market in order to finance a project, because it invariably means that the project must adopt market requirements to successfully sell its products. Products become commodities, and commodities must subordinate themselves to market rules and demands. Adapting to market rules gradually corrupts our own needs-driven activities. It may be a subtle process, but the more we are »successful« in the market, the more we have to postpone our own needs and wishes. An alien logic creeps into our daily activities within the commons.

Through the careful design of our projects, however, we could separate the inner (commons) logic from the outer (market) logic as much as possible. Then the “output” of our commoning can be distributed in strict conformity with our own needs-based agreements. Developing and adhering to our own rules based on our own definitions of fairness might undermine transactional rules of equivalence (“you can take only an equivalent amount to what you give”). But this “imbalance” does not matter because equivalence need only be guaranteed at the level of the whole project, not at the individual level within each single »transaction« (which is no longer a transaction then). In other words, indirect reciprocity is sufficient for assuring fairness and stability of provisioning.

How can this be organized? Assuming that a project requires some amount of monetary flow to keep it running, those revenues should not be allowed to affect the results of the projects. Such sources could be foundations, donations, crowdfunding, bidding or the like. Results could then be distributed within the commons or outside of them. A role model for this type of “decoupling the inner from the outer” market logic is Wikipedia.

Another model is a symbiotic cooperation between commons and private firms. The firm, for instance, could pay activists and innovators to do what it wants because the outcome can be directly or indirectly used by the firm to make profits. This type of financing the commons has been used to finance the development of the Linux kernel, where most of the kernel hackers are paid in a way one might call a »unconditional guaranteed income«. Obviously, this scenario may entail explicit or implicit expectations for commoners to follow the interests of the money-giver in one way or another. However, there are no black-and-white rules for determining this; most real world examples have shades of grey. It is therefore even more important for such projects to have clear criteria and social norms to prevent monetary logic from creeping into projects and influencing or corrupting our commoning activities.”

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