Cognitive Capitalism – P2P Foundation https://blog.p2pfoundation.net Researching, documenting and promoting peer to peer practices Wed, 15 Apr 2020 07:14:06 +0000 en-US hourly 1 https://wordpress.org/?v=5.5.15 62076519 Pooling Knowledge: Private Medicine vs. Public Health? https://blog.p2pfoundation.net/pooling-knowledge-private-medicine-vs-public-health/2020/04/15 https://blog.p2pfoundation.net/pooling-knowledge-private-medicine-vs-public-health/2020/04/15#respond Wed, 15 Apr 2020 07:13:49 +0000 https://blog.p2pfoundation.net/?p=75715 The Coronavirus and the Need for Systems Change, Pt.1 The Coronavirus pandemic raises many questions about public health, global diseases and the way we produce and distribute cures and treatments. Who pays for the corona vaccine and how? How is that innovation organised? Who profits? Commons Network has been an advocate in this domain (‘access... Continue reading

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The Coronavirus and the Need for Systems Change, Pt.1

The Coronavirus pandemic raises many questions about public health, global diseases and the way we produce and distribute cures and treatments. Who pays for the corona vaccine and how? How is that innovation organised? Who profits?

Commons Network has been an advocate in this domain (‘access to medicines’) for years. In the next few months, we will publish a series of articles about the problems with the current system and the ideas and visions that exist to change this. Today, we discuss the proposal for a Covid-19 Knowledge Pool.

COVID-19 is a global health crisis that demands an immediate global response. But this crisis also lays bare many other crises in our societies. In many Western countries, the response to the virus has shown the vulnerabilities in our public health systems and other essential sectors of society. One major issue that the coronavirus exposes is the dire state of our biomedical system and the role that pharmaceutical companies play in that system.

  • In The Netherlands, for instance, hospitals didn’t have enough test kits because Roche, the world’s largest biotech company, initially refused to hand over the recipe that is needed to perform these tests.
  • In the United States, Trump’s ‘corona-minister’ Alex Azar released a statement saying that the government could not guarantee that a potential cure for Covid-19 would be affordable, because the innovation that is needed for that cure would only be spurred by high profits.
  • The rush to create a vaccine was delayed for up to two or three years, because in most countries, pharmaceutical companies had sold their vaccine research facilities. And the companies that still had the capabilities to do the research had effectively scaled down their coronavirus research because there was no money to be made.
  • Scientists were close to a coronavirus vaccine years ago, and then the money dried up.
  • The vaccine market was even called ‘an oligopoly’ by Wall Street analysts at AB Bernstein. In fact, after countries abandoned infectious disease research, most companies also moved away from investing in this field, according to DNDi director Bernard Pecoul.
  • In France, it was debated why a testing kit for coronavirus should cost 135 euro, eventhough the production costs are only 10 euros. The sub-optimal availability of tests was cited as a major reason for not testing in the fight against the pandemic in many European countries, leading many people to ask if this had economic reasons as well.

More and more people have now come to realise that the global race to find a cure for Covid-19 and a vaccine is slowed down considerably by the fact that the system we have now runs on market incentives and patent monopolies. Instead of shielding essential knowledge, companies could work together, share research results and new insights.

Moving away from a deficient system

The pharmaceutical industry is driven by profit and guided by shareholders. The research and innovation that is needed to come up with cures and treatments is monopolised. A system of patents and licenses is fine-tuned to produce the maximum wealth for a few multi-billion euro corporations. This is how we have organised the world of medicines today. Our system is not driven by public health needs but by profit and the only logic that counts is that of capitalism.

Our system is not driven by public health needs but by profit and the only logic that counts is that of capitalism

This model is based on the belief that the flow of biomedical knowledge should be privatized and protected through intellectual property rights in order to stimulate innovation. This monopoly model gives pharmaceutical companies the freedom to charge as much as they can get away with. It also stifles innovation where we most need it, like in the area of infectious diseases, because there is no money to be made. And finally, this system makes us, the people, pay three times: once to fund the universities and research facilities that create a lot of the knowledge needed for pharmaceutical innovation, once to pay these companies to produce and distribute, and once to our governments to fund our health care system.

It’s hard to estimate how many medicines are not invented, how much talent is wasted and how many people have to suffer because of what not is being researched and developed. This sytem limits the ability to collaborate, share knowledge and build on each other’s work. The public good of scientific medical knowledge and health related technologies has been transformed into a highly protected, privatized commodity.

The COVID-19 crisis marks a critical moment for generating the change we need. But how do we go from this neoliberal capitalist logic to something else, towards a system that is driven by the needs of the public and the health of the people?

Knowledge commons

The proposal to build  a global knowledge pool for rights on data, knowledge and technologies that was presented by Costa Rica is a great example of a step in the right direction, towards transformational change. On March 23rd, the government of Costa Rica sent a letter to the World Health Organization, calling for a Global Covid-19 Knowledge Pool1. In his letter to the WHO, the president of Costa Rica demands a global program to “pool rights to technologies that are useful for the detection, prevention, control and treatment of the COVID-19 pandemic.” It now also enjoys the support of the WHO as well as from the UK parliament and the Dutch government and civil society, which has announced their support the idea of a COVID-19 pool as well.

Why do we need a knowledge pool and why is it transformational?

As mentioned above, under our current system the privatization of knowledge limits the ability to collaborate, share knowledge and build on each other’s work. This really is artificial because knowledge is by nature abundant and shareable. Hence the current handling of medical technologies not only limits access to the ensuing treatments, it also limits innovation.

The Covid-19 Poll would pool relevant knowledge & data to combat Covid-19, creating a global knowledge commons2. It is a proposal to create a pool of rights to tests, medicines and vaccines with free access or licensing on reasonable and affordable terms for all countries. This would allow for a collaborative endeavor, and could accelerate innovation. It would be global, open and offer non discriminatory licenses to all relevant technologies and rights. As such the pool would offer both innovation and access.

Inputs could come from governments, as well as from universities, private companies and charities. This could be done on a voluntary basis but not only. Public institutions around the world are investing massively in Covid-19 technologies and all results could be automatically shared with this pool, meaning this could be a condition attached to public financing.

So, placing knowledge in a commons does not just mean sharing data and knowledge without regard for their social use, access and preservation. It means introducing a set of democratic rules and limits to assure equitable and sustainable sharing for health-related resources. As such it allows for equitable access, collaborative innovation and democratic governance of knowledge. At the same time knowledge commons could facilitate open global research and local production adapted to local context.

Placing knowledge in a commons does not just mean sharing data and knowledge without regard for their social use, access and preservation. It means introducing a set of democratic rules and limits to assure equitable and sustainable sharing

If we consider the COVID-19 pool holistic initiative that treats the knowledge as a commons, not only to accelerate innovation but also recognizing this knowledge as a public good for humanity which should be managed in a way to ensure affordable access for all, it could be transformational. In contrast to the existing Medicines Patent Pool this pool would be global and not primarily focus on providing access to exitisting technologies, but more also on innovation: developing diagnostics, medicines and vaccines.

Transformational change

Instead of proposing tweaks it is now time to challenge the idea of handling medicines principally as a commodity or product, and to propose structural changes in order to approach health as a common good.  This means referring to our collective responsibility for – and the governance of health when reframing biomedical knowledge production. Instead of leaving it entirely to markets and monopoly based business models.

For this we should move to an approach based on knowledge sharing, cooperation, stewardship, participation and social equity – in practice, this means shifting to a public interest biomedical system based on knowledge commons and open source research, open access, alternative incentives and a greater role for the public sector. Knowledge pools are a crucial piece of the puzzle.

The current COVID-19 pandemic demonstrates how it is possible to make transformational changes overnight when acting in times of an emergency. Let us use this crisis to acknowledge the failures of today’s biomedical research model and usher in the systemic change needed. The world after Corona will require the consideration of alternative paradigms –  it is indeed, as Costa Rica, Tedros and now the Netherlands as well rightfully confirmed – time for the knowledge commons to flourish now.

For some more background about commons thinking in the field of biomedical R&D and possible alternatives to ensure access to medicines for all, read our our policy paper ‘From Lab to Commons’. See also last year’s work on ‘The People’s Prescription’ by our allies in the UK, in cooperation with professor of Economics Mariana Mazzucato.

  1. The idea of a knowledge pool is to organise the governance of knowledge by pooling intellectual property, data and other knowledge. This can accelerate the development of health technologies and thus stimulate affordable access to the public. In 2010 the Medicines Patent Pool was set up as a response to the unequal access to HIV/AIDS treatments in developing countries. It has proven to be a great success and now functions as a United Nations-backed public health organisation working to increase access to medicines for HIV, Hepatis c and Tuberculosis.
  2. Knowledge commons refer to the institutionalized community governance of the sharing and, in some cases, creation, of information, science, knowledge, data, and other types of intellectual and cultural resources.

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Is Open Design a Viable Economic Practice? https://blog.p2pfoundation.net/is-open-design-a-viable-economic-practice/2019/12/27 https://blog.p2pfoundation.net/is-open-design-a-viable-economic-practice/2019/12/27#respond Fri, 27 Dec 2019 09:15:18 +0000 https://blog.p2pfoundation.net/?p=75625 BY ALEX PAZAITIS | JUNIOR RESEARCH FELLOW, TALLINN UNIVERSITY OF TECHNOLOGY CORE MEMBER, P2P LAB It has been roughly a decade after the days that people first discussed Open Design. It has hitherto evolved from a concept, to a movement, to a viable business choice. The RepRap 3D printer has been one of the first and... Continue reading

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BY ALEX PAZAITIS | JUNIOR RESEARCH FELLOW, TALLINN UNIVERSITY OF TECHNOLOGY CORE MEMBER, P2P LAB

It has been roughly a decade after the days that people first discussed Open Design. It has hitherto evolved from a concept, to a movement, to a viable business choice.

The RepRap 3D printer has been one of the first and most successful examples of open design. A 3D printer that could replicate itself is more than a design solution; it is a bold statement on the technological capacities of our time. A thing built to create other things, now creating copies of itself. Creation, being one of the core human characteristics, is now embedded in our creations.

It is, thus, no wonder it has sparked a wave of enthusiasm across diverse communities. Different visions of open innovation, distributed manufacturing and an automated self-sufficient society embody, to a lesser or larger extent the notion of open design. Though as much as the vision extends, the actual practice remains rather restrained. And while RepRap based 3D printers may have evolved to a billion dollar industry, industrial uptake of open design and open manufacturing is, arguably, still not there to see.

Part of the problem, as it is often the case, is structural. As a social activity, the open sharing of ideas and collaboration to create useful things by the users themselves has a self-evident merit. It can lead to better technologies, more learning from the side of the users, broader access to means of making and less waste, due to on-demand production and better maintenance capacity. But as a business option it goes almost against the foundations of everything we understand as the purpose of an enterprise.

In the end of the day, is able to survive to the extent it succeeds to exchange their products and services for money. Adam Smith in the Wealth of Nations, identifies this practice of exchange as a core survival tactic amongst individuals too. In a society where people produce themselves only a small fraction of the things they need, they exchange the products of their labour with these of other people to get the rest of it. It is then the common sense that markets and money is in fact the very purpose of the economy.

From a different perspective, the economy is about provisioning. It is the sphere of human activity that serves to cover societal needs: from the basic means of subsistence, to things and actions meant for pleasure and self-actualisation. From this point of view, sharing is actually a very economic function. Even more, on many instances it serves to create and distribute vital resources much more efficiently than markets. However, at least until recently, sharing could not be generalised as a capacity providing for human needs at scale. Therefore, it was mainly restrained to those domains where the costs of enforcing the rules necessary for market exchange were simply too high to bear.

But what the internet revolution brought about is much higher capabilities for communication and coordination based on shared information and human sociality. The sphere of these domains where market exchange is not the common sense has rapidly expanded. It became possible for people to pool, rather than exchange, the products of their labour on much greater scale, thus creating a much more generalised capacity for societies to serve their needs.

That is of course not to suggest that markets and money are simply done away with sharing and open design. Nevertheless, they no longer serve as the sole imperatives stimulating human creativity and coordination, if they ever have been. And it is vital for the flourishing of our societies to recognise, support and further stimulate these dynamics in our economic institutions. Even when access to better design and user experience is now more available than ever, businesses, especially small ones, will not invest in these possibilities before clear returns can be foreseen, in terms of covering their overheads, wages and taxes.

In the transitioning from the feudal order to the industrial one, no markets could ever exist and no exchange could take place if there weren’t for the provisions and enforcement of property rights and trade agreements. Likewise, in order to reap the benefits of the new technological capabilities, we need legal provisions to re-establish the relationship of businesses with their user communities now largely participating in the design and production; support measures like universal basic income for workers to be emancipated and devote their creative energy where it most needed in their local societies; and collective institutions that generalise and support pooling of productive capacities wherever possible, from digital platforms of open design, software and knowledge to open spaces for collaborative production, distributed manufacturing and needs-based design for societal needs.

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How Insane is Global Trade? Here are the facts https://blog.p2pfoundation.net/how-insane-is-global-trade-here-are-the-facts/2019/03/26 https://blog.p2pfoundation.net/how-insane-is-global-trade-here-are-the-facts/2019/03/26#respond Tue, 26 Mar 2019 11:25:28 +0000 https://blog.p2pfoundation.net/?p=74805 Reposted from Local Futures. The way trade works in the global economy can be insane – it wastes resources, worsens climate change, and undermines the livelihoods of millions of small-scale producers worldwide. Yet it is an almost unavoidable consequence of de-regulatory ‘free trade’ agreements and the billions of dollars in supports and subsidies – many... Continue reading

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Reposted from Local Futures.

The way trade works in the global economy can be insane – it wastes resources, worsens climate change, and undermines the livelihoods of millions of small-scale producers worldwide. Yet it is an almost unavoidable consequence of de-regulatory ‘free trade’ agreements and the billions of dollars in supports and subsidies – many of them hidden – that prop up the global economy.

To raise awareness about this issue, we’ve produced a short film and a fully-referenced factsheet that helps to explain how and why ‘insane trade’ happens:Read our ‘Insane Trade’ Factsheet (PDF)

Some Jaw-Dropping Facts
about Insane Trade

• More than half of the seafood caught in Alaska
is processed in China; much of it is sent right back to American supermarkets – Alaska Journal of Commerce, 2018.

• Mexican calves fed American corn are exported to the United States, where they are butchered for meat, which is then sold in Mexico – The New York Times, 2017.

• African-grown coffee is often packed in India, Canadian prawns are processed in Iceland, and Bolivian nuts are packed in Italy – UK Times, 2007.

1) Say NO to Insane Trade

Eliminating unnecessary trade would immediately reduce pollution
– including CO2 emissions – and slow resource depletion.

– Speak up – Share our Insane Trade factsheet and short film.

– Call for an end to corporate subsidies and tax breaks. For links to other organizations working on these issues, see the Resisting Corporate Power, Globalization, & ‘Free’ Tradecategory on our Links page. Read more about subsidies on our blog.

– Critically question “free trade” dogma. See our Independent Media Sources page for a list of sites that critically cover free trade. Head to our blog to read more about why so few people are informed about trade issues, and what can be done to stop free trade treaties.

– Support steps to internalize the costs of fossil fuels. For links to other organizations working on this issue, see the Environmental Justice, Climate, & Energy category on our Links page.

2) Say YES to Local Economies

Localizing helps small farms and local businesses to thrive,
strengthens community, and supports personal well-being.

– Buy local food and other local products.

– Help build local food systems and local business alliances. For links to other organizations working on these issues, see the Local Economies and Rethinking Economies and Food & Agriculture categories on our Links page.

– Grow the movement by organizing a workshopstudy group, or film screeningabout economic localization.

Frequently Asked Questions
about Insane Trade

How is it cheaper to ship food across the world for processing than to process it where it was grown or caught?

Companies often relocate labor-intensive work overseas to minimize costs – Scotland’s minimum wage is about four times that of China, for instance, which explains why Scottish fish is often processed in China.

With global fossil fuel subsidies (direct and indirect) on the order of $5 trillion per year, this energy-intensive way of doing business is often less expensive for large food distributors, though it carries great costs for the environment and for livelihoods in the food’s country of origin. Lax international free trade rules help make this possible as well.

Why else might countries “re-import” their own products?

In many cases, companies export and re-import goods to benefit from tax policy loopholes. For example, China’s value-added tax (VAT) allows businesses to claim tax rebates by exporting their products, while other businesses can then re-import those same products to claim rebates of their own. Fossil fuel subsidies, which reduce transport costs for businesses, help make this a viable strategy.

The results are absurd. For example, in most years since 2005, China has imported more from itself than from the United States – despite being the US’s third-largest export market.

Availability of crops varies seasonally – is this a factor in global trade?

Not really. Even in the height of apple season in the northern USA, apples from New Zealand and Chile flood supermarket shelves – and regardless of origin, many supermarket apples stay in cold storage for up to a year, so the season doesn’t matter.

Distributors source from wherever is least expensive within their established channels. Supermarkets will choose apples from 10,000 miles away if they’re cheaper than apples grown just 10 miles away. Same with other fresh foods.

The main contributors to insane trade are subsidized transport, free trade agreements, import-export tax rebates, and differences in labor costs and environmental and safety regulations – not seasonal availability of fresh produce.

What about differences between regional crop and livestock varieties? Does this explain why countries both import and export identical foods?

In most cases, NO. In the world of big agribusiness and global trade, foods are interchangeable commodities – they’re grown in large quantities, and regional differences are something to be eliminated. For monocultural producers and large- scale marketers, the goal is uniformity.

Sometimes, regional differences in foods do influence global trade – but not in the way you might expect. For example, beef from factory- farmed cows in the USA is usually too fatty to be sold as hamburger meat. So, that beef gets shipped abroad, and leaner grass-fed beef gets imported. Changing animal husbandry practices in the USA would solve this problem (and several others) – but because of subsidies for fossil fuels and transport infrastructures, insane trade is the industry’s most profitable “solution”.

How does global trade affect the climate?

In 2012, commercial ships produced over a million tons of CO2 per day – more than the emissions of the UK, or Canada, or Brazil. That’s roughly 4% of the world’s CO2 emissions – and it’s set to grow to 17% by 2050 if current trade rules continue.

The growing aviation industry will produce another 20% of global emissions by 2050. And that doesn’t account for the infrastructure needed to support long-distance trade – including cement production, which already contributes 8% of the world’s emissions per year.

Remarkably, climate agreements like the Paris Accords do not account for the emissions from international trade: the CO2 emitted by the thousands of oil tankers, container ships and cargo-carrying aircraft that crisscross the globe do not appear in any nation’s CO2 accounting. Why? Because policymakers believe that trade – and the growth of global GDP – is more important than the climate. Insane!

Do people just want to buy food, and other things, from far away?

Watch and Share our Insane Trade film (3.10min)

Read and Share our ‘Insane Trade’ Factsheet (PDF)

Photo by ImipolexG

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Book of the Day: Automating Inequality: How High-Tech Tools Profile, Police, and Punish the Poor https://blog.p2pfoundation.net/book-of-the-day-automating-inequality-how-high-tech-tools-profile-police-and-punish-the-poor/2019/01/16 https://blog.p2pfoundation.net/book-of-the-day-automating-inequality-how-high-tech-tools-profile-police-and-punish-the-poor/2019/01/16#respond Wed, 16 Jan 2019 10:00:00 +0000 https://blog.p2pfoundation.net/?p=74017 A powerful investigative look at data-based discrimination—and how technology affects civil and human rights and economic equity The State of Indiana denies one million applications for healthcare, foodstamps and cash benefits in three years—because a new computer system interprets any mistake as “failure to cooperate.” In Los Angeles, an algorithm calculates the comparative vulnerability of... Continue reading

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A powerful investigative look at data-based discrimination—and how technology affects civil and human rights and economic equity

The State of Indiana denies one million applications for healthcare, foodstamps and cash benefits in three years—because a new computer system interprets any mistake as “failure to cooperate.” In Los Angeles, an algorithm calculates the comparative vulnerability of tens of thousands of homeless people in order to prioritize them for an inadequate pool of housing resources. In Pittsburgh, a child welfare agency uses a statistical model to try to predict which children might be future victims of abuse or neglect.

Since the dawn of the digital age, decision-making in finance, employment, politics, health and human services has undergone revolutionary change. Today, automated systems—rather than humans—control which neighborhoods get policed, which families attain needed resources, and who is investigated for fraud. While we all live under this new regime of data, the most invasive and punitive systems are aimed at the poor.

In Automating Inequality, Virginia Eubanks systematically investigates the impacts of data mining, policy algorithms, and predictive risk models on poor and working-class people in America. The book is full of heart-wrenching and eye-opening stories, from a woman in Indiana whose benefits are literally cut off as she lays dying to a family in Pennsylvania in daily fear of losing their daughter because they fit a certain statistical profile.

The U.S. has always used its most cutting-edge science and technology to contain, investigate, discipline and punish the destitute. Like the county poorhouse and scientific charity before them, digital tracking and automated decision-making hide poverty from the middle-class public and give the nation the ethical distance it needs to make inhumane choices: which families get food and which starve, who has housing and who remains homeless, and which families are broken up by the state. In the process, they weaken democracy and betray our most cherished national values.

This deeply researched and passionate book could not be more timely.

WINNER: The 2018 McGannon Center Book Prize and shortlisted for the Goddar Riverside Stephan Russo Book Prize for Social Justice 

The New York Times Book Review: “Riveting.”

Naomi Klein: “This book is downright scary.”

Ethan Zuckerman, MIT: “Should be required reading.”

Dorothy Roberts, author of Killing the Black Body: “A must-read.”

Astra Taylor, author of The People’s Platform: “The single most important book about technology you will read this year.”

Cory Doctorow: “Indispensable.”

Reposted from MacMillan publishers. Click on the link for more reviews and an excerpt.

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Virginia Eubanks on Automating Inequality https://blog.p2pfoundation.net/virginia-eubanks-on-automating-inequality/2019/01/09 https://blog.p2pfoundation.net/virginia-eubanks-on-automating-inequality/2019/01/09#respond Wed, 09 Jan 2019 10:00:00 +0000 https://blog.p2pfoundation.net/?p=73936 SUNY professor and author Virginia Eubanks on how our government and corporations are erasing social services through unequal digital practices. About Virginia Eubanks Virginia Eubanks is an Associate Professor of Political Science at the University at Albany, SUNY. She is the author of Automating Inequality: How High-Tech Tools Profile, Police, and Punish the Poor; Digital Dead End: Fighting... Continue reading

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SUNY professor and author Virginia Eubanks on how our government and corporations are erasing social services through unequal digital practices.

About Virginia Eubanks

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Photo: Sadaf Rassoul Cameron

Virginia Eubanks is an Associate Professor of Political Science at the University at Albany, SUNY. She is the author of Automating Inequality: How High-Tech Tools Profile, Police, and Punish the PoorDigital Dead End: Fighting for Social Justice in the Information Age; and co-editor, with Alethia Jones, of Ain’t Gonna Let Nobody Turn Me Around: Forty Years of Movement Building with Barbara Smith. Her writing about technology and social justice has appeared in Scientific AmericanThe NationHarper’s,and Wired. For two decades, Eubanks has worked in community technology and economic justice movements. She was a founding member of the Our Data Bodies Project and a Fellow at New America. She lives in Troy, NY.

Reposted from the Laura Flanders Show

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13 Ways We Can Fix The “Free Market” So It Works For Regular People, Not Just The Rich https://blog.p2pfoundation.net/13-ways-we-can-fix-the-free-market-so-it-works-for-regular-people-not-just-the-rich/2019/01/08 https://blog.p2pfoundation.net/13-ways-we-can-fix-the-free-market-so-it-works-for-regular-people-not-just-the-rich/2019/01/08#respond Tue, 08 Jan 2019 09:00:00 +0000 https://blog.p2pfoundation.net/?p=73922 Jeffrey Hollender: In his book Saving Capitalism: For the Many, Not the Few, former U.S. Secretary of Labor Robert Reich provides an outstanding guide to many of the factors that prevent the possibility of a truly free market. He writes: Few ideas have more profoundly poisoned the minds of more people than the notion of a... Continue reading

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Jeffrey Hollender: In his book Saving Capitalism: For the Many, Not the Few, former U.S. Secretary of Labor Robert Reich provides an outstanding guide to many of the factors that prevent the possibility of a truly free market. He writes:

Few ideas have more profoundly poisoned the minds of more people than the notion of a “free market” existing somewhere in the universe, into which the government “intrudes.” In this view, whatever inequality or insecurity the market generates is assumed to be natural and the inevitable consequences of impersonal “market forces.” … If you aren’t paid enough to live on, so be it. If others rake in billions, they must be worth it. If millions of people are unemployed or their paychecks are shrinking or they’ll have to work two or three jobs and have no idea what they’ll be earning next month or even next week, that’s unfortunate but it’s the outcome of “market forces.”

Reich’s point is that market forces aren’t the result of a free market, which doesn’t exist, never has existed, and probably never will exist. What we do have is a highly engineered marketplace with hundreds of thousands of rules–rules most often created behind closed doors by people who will benefit from every word and comma they put into place. These rules take endless form–the tax code, appropriations bills, new laws, court rulings, executive orders, and administrative guidance to name just a few.

Democrats and Republicans alike–at all levels of government and in all three branches–design these market forces. They grant favors to local businesses, friends, and favored industries, as well as emerging and dying technologies. While these rules are more likely to limit the liability from the disastrous effects of mountain top coal removal than they are to provide tax benefits to solar energy, most industries have figured out how to play the game. They hire lobbyists, donate to politicians–and they find the benefits exponentially greater than the cost. Journalist Nicholas Kristof noted that the chemical and pharmaceutical industries alone spent $121,000 per member of Congress on lobbying last year. Research from Harvard’s Safra Center for Ethics shows that corporations in general get up to $220 return for every dollar they “invest” in lobbying Congress.

The governing classes and elected officials have always created the rules of the economic game. These legal frameworks and the systems they support affect our nation’s economy and daily life more than the most visible government programs, including social security, food stamps, or health care. 

Reich goes on to say:

The rules are the economy. … As the economic historian Karl Polanyi recognized [in his 1944 book, The Great Transformation, those who argue for “less government” are really arguing for different government—often one that favors them or their patrons. “Deregulation” of the financial sector in the 1980s and 1990s, for example, could more appropriately be described as “reregulation.” It did not mean less government. It meant a different set of rules.

In the book 23 Things They Don’t Tell You About Capitalism, the University of Cambridge economist Ha-Joon Chang writes:

The free market doesn’t exist. Every market has some rules and boundaries that restrict freedom of choice. A market looks free only because we so unconditionally accept its underlying restrictions that we fail to see them. How “free” a market is cannot be objectively defined. It is a political definition. The usual claim by free-market economists that they are trying to defend the market from politically motivated interference by the government is false. Government is always involved and those free-marketeers are as politically motivated as anyone. Overcoming the myth that there is such a thing as an objectively defined “free market” is the first step towards understanding capitalism.

OUR “UNFREE MARKET”

Many opposed environmental regulations, which first appeared a few decades ago on things like cars and factory emissions, as serious infringements on our freedom to choose. Opponents asked: If people want to drive in more-polluting cars, or if factories find that more-polluting production methods are more profitable, why should government stop them? Today, most people accept these regulations, but they’re a sign of an unfree market. So some limitations on freedom (i.e., protective legislation) can be helpful. But most “unfreedoms” can be devastating. In essence, we have to choose which unfreedoms we want to live with.

Most would consider monopolies a sign of an unfree, and even an immoral market. Monsanto, through the licensing of technology with its GMO seeds, controls 90% of the soybeans and 80% of the cornplanted and grown in America. According to the Center for Food Safety, this drove up the average cost of planting a single acre of soybeans 325%. For corn, the cost has risen 2,659% between 1994 and 2011. So through its monopolized control of seeds, it is driving the price of food through the roof, ensuring the starvation of millions of people around the world.

Powdered cocaine is a drug generally preferred by rich, white Americans, while the poor tend to use crack cocaine. While both are illegal, crack carries a legal penalty 100 times longer than the same substance in powdered form. It seems that there’s also no free market when it comes to jail terms. Not surprisingly, with wealth, power, and influence come lighter criminal penalties.

Higher education has also never been part of the free market. Admissions spots at universities are “sold” more often that we we’d like to believe, whether through the influence of legal donations, or powerful friends or family.

The free market is an illusion. If some markets look free, it is only because we so totally accept the regulations that are propping them up that they become invisible.

SOCIAL INEQUITY BY DESIGN

“We can have a democracy or we can have great wealth in the hands of a few, but we cannot have both.”—Louis Brandeis

An undeniable result of this unfree market is the continued consolidation of wealth and influence. On average, CEO pay has increased 937% between 1978 and 2013. The average worker’s pay increased just 10.2% over the same period. This increase has little to do with the increasing value of these CEOs, and everything to do with the power and influence they have over the rules of the system that allow them to enrich themselves. 

The real earnings of the median male have declined 19% since 1970, and the median male with only a high school diploma saw his real earnings fall 41% from 1970 to 2010. Among those classified as poor, 20.4 million people live in what is considered “deep poverty,” meaning their incomes are 50% below the official poverty line. One quarter of the nation’s Hispanics and 27% of African Americans live in poverty.

Reich writes: “There is no longer any significant countervailing force (like powerful labor unions), no force to constrain or balance the growing political strength of large corporations, Wall Street, and the very wealthy.” He also describes research conducted by Princeton professors Martin Gilens and Benjamin Page, which analyzed 1,799 policy issues to determine the influence of economic elites and business groups on public policy issues compared to average citizens. It found that, “The preferences of the average American appear to have only a minuscule, near-zero, statistically non-significant impact on public policy.” 

The notion that we live in a democracy turns out to be just another illusion. The deteriorated state of our democracy more easily enables the wealthy and powerful to write the rules and give themselves the greatest benefits. Activists Martin Kirk and Alnoor Ladha argue that the current set of rules that articulate the values of our economic operating system can be best characterized as extractive, exploitative, greedy, selfish, elitist, hierarchical, patriarchal, life-denying, and indeed, psychotic. They invoke the Cree Indian term, wetiko, which is a cannibalistic spirit with an insatiable desire for consumption, that eventually even subsumes its host. They are essentially saying that the animating force of late-stage capitalism is the mind-virus of wetiko.

In sum, we have a system that has already chosen winners and losers. A system that elaborately ensures who gets into Ivy League colleges, gets the best jobs, makes the most money, and enjoys the most privileged lives. This is the same system that decides which businesses receive the most corporate welfare, benefit most from regulations, receive the best protection from foreign competitors, and are most likely to get the best returns on their lobbying dollars. We have, at the end of the day, the freest marketplace that money can buy. A system created by wetikos to perpetuate wetiko.

THIRTEEN WAYS TO START FIXING THE PROBLEM

The solution lies not in a freer marketplace with less government intervention, but in a marketplace that expresses the wishes and best interests of the majority, in one that fairly protects the rights of minorities with what we might call a “democratic marketplace,” driven by a commitment to justice, equity, interdependence, ecological regeneration, and the well-being of all life. 

How do we move toward this goal? Here are 13 ways to start fixing the deep psychosis of our system.

1.  Get money out of politics. We must overturn Citizens United v. FEC, support organizations like Free Speech For People (which has led an attack on the ruling), and ultimately transition to 100% publicly financed elections.

2.  Require disclosure on the source of funding for any and all documents published academically or in the public domain.

3.  Create new anti-trust laws that prevent and eliminate monopolies.

4.  End all corporate financial subsidies.

5.  End insider trading.

6. Initiate an immediate living wage and transition to a basic minimum income for all citizens.

7.  Expand the definition of unionized labor to increase the number of workers that unions represent.

8.  Set a corporate minimum tax rate of 25%.

9.  Eliminate the second home mortgage deduction.

10.  Increase funding available to fund Employee Stock Ownership Plansand build greater tax incentives for co-operatives and other forms of employee ownership.

11.  Stop transferring the cost of product externalities from business to society. The American Sustainable Business Council (which I cofounded) has a working group developing policy recommendations that would begin to move us toward full-cost accounting.

12.  Permanently eliminate payroll taxes.

13.  Mandate that women make up 50% of the directors of all public and private companies over the next three years.

This is not an exhaustive list, but rather an example of what is possible that highlights how many existing solutions already exist. We have been taught that politics and economics are separate fields. But that is an artificial distinction that serves the power elites and their agents of exploitation. We must rein in the corporate take-over of society so that we can reimagine commerce, community, and government itself, and usher in a just transition to a post-capitalist, post-wetiko world. You can .


Jeffrey Hollender (@JeffHollender) is cofounder and former CEO of Seventh Generation, and now the CEO of Sustain Natural. He is the author of six books, including How to Make the World a Better Place: A Guide to Doing Good.

Part of the Seeing Wetiko series. See all articles here. This article was originally published in Fast Company.

An earlier version of this article appeared in the Stanford Social Innovation Review on March 30, 2016.

[Photos: Flickr users Quinn DombrowskiJohn MurphyTobinAdam Swankbrownpau. vitaliy_73 via Shutterstock]

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Book of the Day: Knowledge, Spirit, Law // Book 1: Radical Scholarship https://blog.p2pfoundation.net/book-of-the-day-knowledge-spirit-law-book-1-radical-scholarship/2019/01/07 https://blog.p2pfoundation.net/book-of-the-day-knowledge-spirit-law-book-1-radical-scholarship/2019/01/07#respond Mon, 07 Jan 2019 09:00:00 +0000 https://blog.p2pfoundation.net/?p=73926 Knowledge, Spirit, Law // Book 1: Radical Scholarship by Gavin Keeney, published by Punctum Books. Knowledge, Spirit, Law is a de facto phenomenology of scholarship in the age of neoliberal capitalism. The eleven essays (plus Appendices) in Book 1: Radical Scholarship cover topics and circle themes related to the problems and crises specific to neoliberal academia,... Continue reading

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Knowledge, Spirit, Law // Book 1: Radical Scholarship by Gavin Keeney, published by Punctum Books.

Knowledge, Spirit, Law is a de facto phenomenology of scholarship in the age of neoliberal capitalism. The eleven essays (plus Appendices) in Book 1: Radical Scholarship cover topics and circle themes related to the problems and crises specific to neoliberal academia, while proposing creative paths around the various obstructions. The obstructions include metrics-obsessed academia, circular and incestuous peer review, digitalization of research as stalking horse for text- and data-mining, and violation by global corporate fiat of Intellectual Property and the Moral Rights of Authors. These issues, while addressed obliquely in the main text, definitively inform the various proscriptive aspects of the essays and, via the Introduction and Appendices, underscore the necessity of developing new-old means to no obvious end in the production of knowledge — that is to say, a return to forms of non-instrumentalized intellectual inquiry. To be developed in two concurrent volumes, Knowledge, Spirit, Law will serve as a “moving and/or shifting anthology” of new forms of expression in humanistic studies. Book 2: The Anti-Capitalist Sublime will be published in Autumn 2017.

About the author

Gavin Keeney is an editor, writer, and critic. His most recent books include Dossier Chris Marker: The Suffering Image (2012) and Not-I/Thou: The Other Subject of Art and Architecture (2014), both produced as part of PhD studies conducted in Australia and Europe from 2011 to 2014. He is the Creative Director of Agence ‘X’, an editorial and artists’ and architects’ re-representation bureau founded in New York, New York, in October 2007.

Photo by La caverne aux trésors

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Race and Intersectionality in the New Economy https://blog.p2pfoundation.net/race-and-intersectionality-in-the-new-economy/2019/01/03 https://blog.p2pfoundation.net/race-and-intersectionality-in-the-new-economy/2019/01/03#respond Thu, 03 Jan 2019 09:00:00 +0000 https://blog.p2pfoundation.net/?p=73886 Gurpreet Bola: Progressives reference the ‘new economy’ in order to describe a system that is based on social and environmental justice. Yet type these words into any search engine and you’ll find that we don’t own it, neoliberals do. The ‘new economy’ they are talking about refers to the emerging and ever-strengthening data economy. This... Continue reading

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Gurpreet Bola: Progressives reference the ‘new economy’ in order to describe a system that is based on social and environmental justice. Yet type these words into any search engine and you’ll find that we don’t own it, neoliberals do. The ‘new economy’ they are talking about refers to the emerging and ever-strengthening data economy. This economy is built on a technology that is rooted in the same principles and institutions as neoliberal capitalism. As such, we have some indication of what is in store, particularly around work, wages, and racial injustice. 

Labour market trends that assess who is most impacted by precarious work all show up the same patterns; these folks are black and brown, often women, and often working class. Precarious work includes digital apps such as Uber, abuse of zero-hour contracts, or those most at risk from losing a job due to automation. As this ‘new economy’ thrives, we need to be aware that race inequality will worsen because white supremacy is a systemic feature of neoliberal capitalism. This article suggests seven concrete steps that progressives can take towards a genuinely new and transformative economy for all workers. 

Play the race card 

Our economic system inherently disadvantages marginalised groups, and this trend is consistent through history. To better understand why this happens, we need to consciously develop a deeper analysis of the problem we are trying to address. In this case, how are Black, Asian, and Minority Ethnic (BAME) workers impacted by the rise of precarious work practices? 

Research conducted by the Resolution Foundation think tank shows that ‘minority ethnic’ families currently earn nearly £9000 a year less than their white British counterparts. This is supported further by the tuc’s Insecure Work and Ethnicity report that identified one in every 13 BAME workers were in insecure employment, compared to one in 20 for white workers. The same report also identifies that of the 3.1 million BAME workers in the UK, nearly a quarter were in insecure work or were likely to be underemployed. Additionally, the number of BAME workers in insecure jobs rose by 2% in five years, whilst the number of white workers remained the same. 

Wages and earnings aren’t the only issues here. Precarious work is often not a choice, but a result of systemic racism in which BAME workers find it harder to access stable employment. In addition, expecting digital platforms to deliver some utopian democracy ignores the reality of white supremacy. When your customer base is largely white affluent middle class, this plays into the race and class power dynamic, sometimes influencing who gets chosen for work. And as independent contractors, these workers are also at risk of abuse or attacks with very little protection. And in a society where the new norms are xenophobic rhetoric and hate crime, this leaves many unsupported workers vulnerable to discrimination, hurt, and shame. 

If you need any more evidence on the broader systemic failures around employment and work, the Race Disparity Audit commissioned by the government offers a sobering and heartbreaking reality check on the lived experience of the BAME population in the workplace. What is important to take away from this evidence is that marginalisation of communities is active, not passive. There are multiple systems at play that are responsible for race inequality; white supremacy, elitism, and patriarchy to name but a few. 

Decolonise economics 

How is this data shaped by the characteristics of neoliberal capitalism? For this we need to look to the origins of capitalism as an economic model and, as a result, how deep white supremacy is embedded in the functions of our society – even today. 

Many people argue that the modern economy has brought us substantial material benefits, better rights for workers, and flexibility in work practices. Whilst this may be the case, these benefits have, by design, been disproportionately distributed amongst a privileged few. For the global majority (non-white people/people of colour), capitalism is a system that is historically tied to colonialism and racism. Colonialism is a project that led to the demolition of sacred land and cultures, extraction of natural resources, sale of black bodies as property, and sent brown bodies to war for the British Empire. 

The colonial mindset continues to this day and is justified by the pursuit of economic growth that is centred around white superiority. We can connect capitalism with white supremacy, and come to understand racism as the tool by which white European colonisers wielded economic power over large parts of the Americas, Asia, and Africa. Well known critical race theorist F.L. Ansley helps us understand the colonial mindset here:

By ‘white supremacy’ I do not mean to allude only to the self-conscious racism of white supremacist hate groups. I refer instead to a political, economic, and cultural system in which whites overwhelmingly control power and material resources, conscious and unconscious ideas of white superiority and entitlement are widespread, and relations of white dominance and non-white subordination are daily re-enacted across a broad array of institutions and social settings.”

500 years of colonial rule and settler colonialism has created an economy so entrenched in systems of oppression that we must connect this to the reality of inequality today. In Britain, a colonial mindset dominates the way institutions control our media, legal system, education, financing and policing, and the way we respond to them. As a result, white supremacy is normalised as an invisible force that is subtle and powerful. The evidence for structural racism is clear, and the only justification that is viable is the lasting legacy of white supremacy. Future alternatives to neoliberalism need to be informed by confronting our economic history of colonialism, mercantilism, and imperialism. 

How to centre race in the new economy

Neoliberalism is a particularly vicious form of capitalism that has destroyed so much of the fabric of our society, including public services, decent housing, and stable employment. No one should be surprised that BAME workers are the first to be impacted by precarious work. If anything, it is evidence that neoliberal capitalism is functioning as intended: through the exploitation of people of colour. In responding to this, however, we cannot escape the rapid development of technology and the way this is reshaping our work practices. Wage equality and workers rights can only be realised if we centre the BAME community at the heart of our efforts to build alternatives, so that we can truly challenge the foundations of neoliberal capitalism. We can do this in many ways. 

Stronger movements

In the past century, people of colour in Britain have fought for equal rights alongside white-centred movements, be it through the Suffragettes or labour strikes. They’ve done this in the margins, achieving part but not all of the rights that have been afforded to their white British counterparts. By centreing the lived experience of BAME workers in all our actions, be it labour strikes, protests, or workplace organising, we can be sure to attend to those that are feeling the impact of the gig-economy now, not just the fear of it hitting us in the future. Investigate which sectors are predominantly BAME in identity, and understand their concerns, and do this without essentialising or tokenism of any one identity. Use your time to follow groups such as Hotel Workers Branch and Justice for Domestic Workers, and interrogate campaigns that are whitewashed or lack depth and integrity. 

Intersectional analysis

In our work, we need to recognise the overlapping – or intersecting – nature of discrimination that plays a role in our understanding of wage inequality. In this article I’ve concentrated on ‘people of colour’ as one group without doing the necessary work of breaking this down into gender, ability, class, sexuality, migration status and the many other social factors that influence how society influences the workplace. Uncovering this evidence will open our eyes to the reality of inequality, and a deeper understanding of the structure of the economy. Be mindful that using intersectionality as a tool to better understand different lived experiences does not absolve us of our privilege and the work we need to do on ourselves. 

Challenging narratives

An intersectional analysis also allows us to challenge ideas that are designed to divide us. An example of this is the widespread use of the term ‘white working-class’, which routinely excludes the reality of black, brown and Asian working class communities in Britain. Evidence consistently shows that a higher percentage of the BAME community are working class when compared to the white British population. Let’s also challenge the narrative of ‘Black, Asian and Minority Ethnic’ that comes from a Eurocentric view of our globalised world. Whilst I have embraced this terminology in this article, a vision for a new economy should use terms such as people of global majority, people from formerly colonised nations, or people of colour in order to free us from our colonial mindset. 

Relevant alternatives

The progressive ‘new economy’ scene in the UK is full of ideas for alternative practices to neoliberalism when it comes to work and wages. Consider ‘new economy’ projects that build co-operatives or use the gift economy. They are often designed for a lived experience that is so disconnected from those who need it, it renders them inaccessible and irrelevant to the broader goal of economic systems change. The irony here is that many of the alternatives are rooted in a non-European indigenous history, and have been appropriated by those who already have social power. When designing alternatives, take inspiration from some excellent organisations who are decolonising these ideas to make them work for black and brown communities. Explore why Black Lives Matter adopted Universal Basic Income as a central demand in their manifesto, and how one black community in Jackson, Mississippi is using technology and data to reinvent their local economy. 

So, ask yourself now “where is this work happening in the UK, and who knows about it?” We all want to commit to building a new economy that works for everyone. To do so we need to get our analysis clear, and recognise that capitalism will always be one step ahead of us unless we are willing to centre people of colour in the solutions we build.

If we do so, we will have built the foundations for alternatives that are powerful enough to uproot neoliberal capitalism for good. If we don’t then the ‘new economy’ will be little more than the successor to what we already have.


Gurpreet Bola is an organiser, trainer, researcher, and writer. She is committed to political and social systems change. Her economic analysis has supported activists to identify the root cause of social inequalities and oppression.

This is a print first feature published in STIR magazine.

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Unions and the Gig-Economy: The Case of AirBnB https://blog.p2pfoundation.net/unions-and-the-gig-economy-the-case-of-airbnb/2018/12/28 https://blog.p2pfoundation.net/unions-and-the-gig-economy-the-case-of-airbnb/2018/12/28#respond Fri, 28 Dec 2018 09:00:00 +0000 https://blog.p2pfoundation.net/?p=73863 In this article, reposted from Socialist Project, Steven Tufts examines union reactions to sharewashing platforms. Steven Tufts: The so-called gig-economy is celebrated, maligned, fetishized, and qualified by analysts. Whether it is called the collaborative, platform, crowd-sourcing, or sharing-economy, the rise of peer-to-peer exchanges does raise important questions for workers. Do emerging ‘sharing-economy’ platforms such as Uber and Airbnb mark... Continue reading

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In this article, reposted from Socialist Project, Steven Tufts examines union reactions to sharewashing platforms.

Steven Tufts: The so-called gig-economy is celebrated, maligned, fetishized, and qualified by analysts. Whether it is called the collaborative, platform, crowd-sourcing, or sharing-economy, the rise of peer-to-peer exchanges does raise important questions for workers. Do emerging ‘sharing-economy’ platforms such as Uber and Airbnb mark a significant shift in production and distribution systems? Are they emancipatory or exploitive? How can they be regulated across multiple jurisdictions and multiple platforms (e.g., Airbnb, Homestay, Uber, Lyft)? These and other questions have been raised by those emphasizing the platforms as a growing source of employment for contingent workers and their power to transform waged work into different relationships such as dependent contracts.1 Kim Moody recently offered that these platforms are simply advanced ways for workers to ‘moonlight’ in an age characterized by depressed wage growth and the majority of new employment being in low wage, precarious jobs.2 Despite the success of these services with consumers, there are contradictions for the future of work and implications for organized labour that unions are only starting to address – albeit in contradictory ways.

In mid-July 2016, the interim report on Ontario’s Changing Workplaces Review was released. The 300 plus page report said very little specifically about the gig-economy with the exception of a few sparse mentions on the role technology plays in changing employment relations.3 The Review is interested in how to extend workplace protection to workers using platforms such as Uber, TaskRabbit and Airbnb to supplement their incomes.4 Indeed, much of the report focusses on the general challenges of misclassification of workers as contractors.5 Here, the options presented to deal with gig-economy work are to either: maintain the status quo and exclude many of these workers as independent contractors; recognize these workers as ‘dependent contractors’6 (e.g. Uber drivers) and extend employment standards to them; or develop new regulations and standards that are specific to dependent contractors with exemptions for some sectors and workers.

Gaps and Exemptions

The narrow framing of the options misses some important points. First, regulation of ‘dependent contractors’ in the gig-economy will be subject to exemptions for specific sectors and workers just as other sectors managed to be exempt from the Employment Standards Act (ESA) in the past. Exemptions in the present ESA have been documented, such as the exclusion of a disproportionate numbers of women, young people, and racialized workers in sectors such as agriculture and hospitality.7 Second, there is an ‘enforcement gap’ that persists even when innovative and appropriate standards are established and applied to broad sectors.8If employers in small workplaces cannot be held accountable to the ESA, then how can the state ever enforce standards in a hyper-fissured gig-economy with private platforms organizing thousands of contractors? There are legal challenges to classifications, but the courts are inefficient in finding timely resolutions through litigation over classification and enforcement.9 Third, and perhaps most important, is the fact that new platforms continue to erode traditional employment relationships and threaten unionized jobs in existing sectors. Taxi drivers are replaced by Uber drivers and unionized hotel labour is replaced by Airbnb hosts and subcontracted cleaners. The platforms effectively download risk and investment to individuals as personal assets (i.e., cars and homes) are more deeply integrated into processes of accumulation. Workers earning substandard income in precarious employment are trapped in a vicious circle where they are forced to moonlight using Uber or rent out their homes via Airbnb to make ends meet.

At same time, capital is also able to use the platforms to create new types of operations. For example, property owners with multiple housing units can now rent out their properties on a short term basis at a daily rate much higher than longer term rentals with minimal transaction costs. These economic activities, mistakenly all lumped together as ‘home-sharing’, undermine unionized jobs and employment in sectors such as accommodation and have wide ranging impacts on rental housing markets.

The Rise of Airbnb

While the social costs of Uber were the first to be discussed at length,10 there is also the case of Airbnb and smaller short-term rental platforms. The rapid expansion of the Airbnb platform in Toronto is astounding. There are currently over 12,000 listings for Toronto on the Airbnb platform as the number of listings doubled in 2016 from 2015.11 Airbnb’s recruitment and marketing image as an opportunity for individual ‘hosts’ to share their rooms or their homes to earn money for vacations and holidays is challenged by the data.12 First, a majority of rentals and revenues are ‘entire homes’ not extra room rentals or shared accommodations. Second, over 50 per cent of revenues from Airbnb are generated by ‘multi-unit hosts’. These are professional operations holding multiple units – sometimes in the same condo facility – using the platform to enter the short-term rental accommodation sector.13

The result is the rise of ‘ghost hotels’, buildings or properties in close proximity with one another owned by a single operator renting out multiple units as short-term rentals on platforms such as Airbnb. The impact on the hotel sector is not insignificant. Airbnb has grown from almost nothing in 2010 to over 12,000 listings in the Greater Toronto Area and it is estimated to have already captured over 5% of the market share in Toronto and Vancouver. With over 1,000 rooms booked through Airbnb each night in Toronto, it is the equivalent of Toronto’s Chelsea hotel, the largest hotel in Canada, being rented to almost full capacity. There have been relatively few new net rooms added to the city’s hotel room supply over the last 15 years. Development has largely been restricted to smaller co-developments which include hotels and condos. At the same time, the owners of the Chelsea and other hotels are seeking to convert their properties to condominiums, further removing significant hotel room supply from the market. Conversions not only threaten unionized hotel jobs, but also diminish the city’s capacity to attract and host large conventions and events.

Even more significant than the employment effects is the removal of units from the rental housing stock. The shift of entire units from long term to short rentals has implications for Toronto’s housing supply. Research from David Wachsmuth and colleagues at McGill University has found that Airbnb alone removed 13,700 units from the housings stocks of Montreal, Toronto, and Vancouver.14 The bulk of these listings are in high demand neighbourhoods. The expanding short-term rental units do not pay commercial property taxes (which are double that of residential property taxes) or any special hotel taxes, reducing the municipal revenues that are needed to pay for public housing and tourism promotion.

Other impacts have also been reported in the media. The disruption of Toronto neighbourhoods by ‘party Airbnbs’ where multiple unit hosts operate are a concern.15 Even more disruptive and contentious is the explosion of Airbnb rental units in condominiums, some of which have bylaws prohibiting short-term rentals. In a recent twist, Airbnb is now partnering with condo developments, engaging in one-on-one agreements with condo boards over issues such as security and complaints and agreeing to revenue sharing with the boards themselves.16 This privatized regulation allows the Airbnb platform sole access to condos that might otherwise pass bylaws to restrict ghost-hotels in the property or allow competing platforms to operate. Airbnb is also used by hosts to secure mortgages for homes they might not get financing for without the additional short-term rental revenue stream. It is hardly surprising that Airbnb has even floated the idea of building its own brick and mortar properties.

Airbnb is currently valued at $31-billion and growing rapidly in major urban areas. The company aggressively lobbies municipalities seeking to regulate its operations and does not hesitate to litigate.17Currently, there are multiple battles to regulate short-term rentals and Airbnb as the largest platform. There are a number of issues at play, ranging from restricting short-term rentals to in-home units, forbidding multiple listings by ghost hotel owners, and platform accountability. Unions have engaged with the rise of short-term rental platforms in different ways, with UNITEHERE taking the lead in Canada with the formation of the Fairbnb.ca coalition to fight against Airbnb’s unregulated expansion in Canada’s largest urban markets.

Union Response to Airbnb

Fairbnb.ca is a coalition founded by UNITEHERE Local 75 in July 2016. The coalition includes some tenants’ rights organizations, neighborhood groups, condo owners’ associations, hotel ownership groups, and sympathetic academics (including the author). It is best described as what Amanda Tattersall and David Reynolds term a ‘support’ coalition.18 Such coalitions are initiated by a union and largely resourced and administered by a single organization with some input from supporters. The coalition can operate at multiple scales, but in this case focuses on municipal bylaws. Fairbnb.ca is organizationally driven by UNITEHERE Local 75 representing 7,000 hospitality workers in Toronto. The coalition is entirely union-financed with in-kind contributions from coalition partners. The motivations for supporters range from primary concerns with lack of affordable housing in the city, to neighbourhood disruption, to the loss of hotel jobs. Further, there is a cross-class component to the coalition with the union partnering with some hotel employers fearing the loss of market share to short-term rentals.

Despite the structural limits of support coalitions, Fairbnb.ca has had significant success in raising the issues related to short-term rentals in Canada’s large cities. It has also been successful in getting municipalities to consider the impacts of short-term rentals seriously and regulate online platforms through municipal bylaws. This has been achieved primarily through media campaigns and lobbying efforts countering the superior communications and lobbying resources of Airbnb. In Toronto, proposed legislation will establish a licensing and registration system and restrict ‘multiple listings’ from a single host. Still contentious is the issue of allowing home owners to list ‘secondary suites’ (self-contained units in homes) which can potentially be used as long-term rentals. There also remains a lack of clarity over how accountable platforms such as Airbnb will be in reporting violations and sharing data with the city.19

Though UNITEHERE has had significant success in engaging Airbnb through its coalition strategy, other unions have chosen a quite different path of engagement with the platform. Unifor in particular has publicly supported Airbnb as ‘progressive’ capital given the company’s support for a higher minimum wage, partnerships with settlement agencies housing refugees, and alleged openness to fair regulation. In a statement submitted to Toronto city council, Unifor President Jerry Dias argues that:

“Airbnb is setting an example for a path forward that couples the potential of the digital economy with the reality of working people across the country, and has demonstrated its willingness to operate in a manner consistent with the goals of broader society. Because of Airbnb’s progressive approach, Unifor is exploring ways to work together with them. We will continue to explore areas of mutual interest to improve the public good, and if possible work toward a national partnership.”20

This ‘partnership’ is indeed politically useful for Airbnb as it conveniently gives the company some progressive legitimacy and provides councillors who wish to side with Airbnb against Fairbnb.ca some political cover. Less clear is what Unifor has to gain through such a social ‘partnership’. In the USA, SEIU did attempt to undermine UNITEHERE with a similar partnership with Airbnb that promised the union access to organizing short-term rental room cleaners. But this deal collapsed after SEIU faced public criticism (and perhaps also recognized how difficult it would be to organize workers in ghost hotels).21 Unifor may be seeking a similar arrangement or even an understanding that would allow the union to represent brick and mortar hotels being planned by Airbnb.22 Here, we see echoes of the union’s controversial strategy to form a partnership with Magna with its ‘Framework for Fairness’ agreement a decade ago.23 Yet short-term rentals employ far less workers than the auto parts sector. In a recent report released by The Hotel Association of Canada, it is estimated that the hotel sector in Canada generates 191,600 full-time equivalent jobs, while Airbnb generates only 1,037.24 At this time, evidence indicates that short-term rentals simply do not generate nearly the same number of jobs as the traditional hotel sector which provides a full range of hospitality services. It is difficult to see how large numbers of new members might be organized through this strategy and whether any partnership with Airbnb will give Unifor any leverage in reaching these precarious workers.

It may be that Unifor’s involvement with Airbnb is more related to recent conflicts among unions. In July 2016, Airbnb made a great deal of fanfare of its hiring of Alex Dagg as its Canadian Policy Lead to head-up its municipal lobbying efforts. Dagg, once heralded as a promising and innovative labour organizer in Toronto was a leader of UNITE when it merged with HERE in the mid-2000s. Following an intense internal fight, the UNITE portion of the UNITEHERE merger left the union to form Workers United and joined SEIU. The relationship between Dagg and what now constitutes UNITEHERE Local 75 might be charitably described as ‘strained’. Dagg soon left SEIU to become Director of Operations for the National Hockey League Players Association. The hiring of Dagg to counter Fairbnb.ca would appear to be more than coincidence and quite strategic on the company’s part. Airbnb in its press release announcing Dagg’s appointment focused – in keeping with its progressive capital image – on Dagg’s career experience ‘championing social justice’ in the union movement.25

Unifor established a presence in the accommodation sector decades ago with its merger with railway workers in the Canadian Brotherhood of Railway Transport and General Workers, which also represented the workers employed at the grand railway hotels. UNITEHERE has historically defended itself against raiding from a number of large unions operating in Canada. As part of this experience, it is not unexpected that UNITEHERE endorsed a letter to the CLC from a number of its affiliates harshly criticizing Unifor’s disastrous attempt to take over the Amalgamated Transit Union Local in 2016. In short, the opposing forms of union engagement with Airbnb may be inseparable from patterns of divisive labour movement internal conflicts which the company is trying to exploit to its advantage.

Beyond Cross-Class Coalitions

As a support coalition, Fairbnb.ca is not primarily designed to build a movement for affordable housing or broader regulation of the gig-economy. Fairbnb.ca’s success to date as a specific issue public campaign lies with a single organization setting strategic goals and partners deciding how best they can provide support (e.g., joint-lobbying, deputations). Admittedly, it is an effective structure for this type of campaign. In the case of short-term rentals, it can be argued that UNITEHERE’s and Unifor’s strategic choices engaging the gig-economy are also shaped by the persistent sectarianism that continues to plague the labour movement in Canada.

UNITEHERE, a small union relative to large general unions in Canada, is understandably cautious about working closely with other unions given that it has been targeted for raiding in the past. Also important is the fact that Fairbnb.ca is a cross-class coalition that does include hotel employers. While the few employers formally in Fairbnb.ca do not provide anything beyond in-kind support, the inclusion of capital from the outset structures the aims of the coalition in a very specific manner. The decision to not initially build a larger class-based coalition with multiple unions and a more expansive list of community groups limits Fairbnb.ca primarily to a media campaign and lobbying effort.

Unifor’s opposing strategy of embracing cross-class ‘progressive capital’ is as cynical as it is short-sighted. Partnership with Airbnb is unlikely to yield many new members from ‘ghost hotels’ and it remains unclear how Dias will explain partnership with a company undermining traditional hotels to his members working in the sector. Dias will also have to explain to activist members why their union is supporting a multinational firm that is removing thousands of rental units from the housing stock of large cities. While it is difficult to imagine that Unifor has embraced the partnership deal solely in response to a political difference with a smaller union, this cannot be easily dismissed as a partial explanation.

No single union is able to take on such immense and growing sectors of the economy alone. Central labour bodies and local labour councils do not have the capacities (or the affiliate support) to coordinate sectoral responses and strategies, so new formations are needed. In the case of short-term rentals, a local sector council of unions representing hotel workers may be useful. UNITEHERE represents the majority of unionized hotel workers in Toronto, but there are other large and well-resourced unions representing hotel workers in large cities. A common sectoral strategy and approach is what concern for workers in the sector demands. On this front, UNITEHERE has begun the process of re-establishing relations with the CSN fighting against short-term rentals in Quebec. At the same time, Unifor has participated in informal local sector councils such as the Toronto Airport Workers’ Council (TAWC) as it counters efforts to privatize Pearson International Airport.26

New spaces of solidarity such as local sector councils where local unions representing workers in the same sector can talk to each other about common shop-floor issues are important. Further, local united fronts will more effectively confront large gig-economy firms lobbying against progressive municipal regulation – an increasingly important arena of engagement for labour, capital, and the state.27 While unions require an urban strategy, local sector councils do not need to abandon the arenas of provincial or national regulation or fail to engage with the Changing Workplaces Review and its implications for gig-economy work. Successful local sector councils with an urban focus will have a multi-scalar sensibility as all social movements do. Local level formations can, however, address common concerns free from national and international leadership and start to overcome destructive sectarianism. If organized labour fragmented, workers will continue to suffer in – or be displaced from – regressive gig-economy workplaces. •

Endnotes

  1. Ursula Huws is a leading voice of critical gig-economy analysis in this respect. See: “Platform labour: Sharing Economy or Virtual Wild West?,” Journal for a Progressive Economy, January, 2016, 24-27.
  2. C. Brooks, “Interview with Kim Moody: Busting the Myths of a Workerless Future,” Labor Notes, July 26, 2016.
  3. C.M. Mitchell and J.C. Murray, Changing Workplaces Review – Special Advisors’ Interim Report. Prepared for the Ontario Ministry of Labour to support the Changing Workplaces Review, 2016. The review does briefly mention the gig economy on p. 146.
  4. The Changing Workplaces Review comments: “The growth of ‘the sharing economy’ continues to challenge business, lawmakers and regulators,” p. 19.
  5. The Changing Workplaces Review acknowledges that for labour advocates:“Their concern about misclassification was not limited to one business or sector, but was expressed as likely more prevalent in certain segments of the economy including: the “gig” or “sharing” economy, cleaning, trucking, food delivery and information technology – to name but a few.” p. 146.
  6. “Dependent Contractor” is the ‘common law compromise between standard employment relationship and independent contractor. See also G. White, “When will labour laws catch up with the gig economy?,” The Atlantic, December 9, 2015; D. Doorey, The Law of Work: Common Law and the Regulation of Work. Emond Publishing, Toronto, 2016.
  7. L. Vosko, A.M. Noack, M.P. Thomas, How Far Does the Employment Standards Act, 2000 Extend and What Are the Gaps in Coverage, Toronto: Ontario Ministry of Labour, (Submission prepared for the Ontario Ministry of Labour to support the Changing Workplaces Review) 2015.
  8. L. Vosko and M. Thomas, ‘Confronting the employment standards enforcement gap: Exploring the potential for union engagement with employment law in Ontario, Canada’ Journal of Industrial Relations 56 (5), 2014, 631-652.
  9. M.A. Cherry, ‘Beyond Misclassification: The Digital Transformation of Work’, Comparative Labor Law & Policy Journal, 37(3), 2016, 544-577.
  10. See for example B. Rogers, “The Social Costs of Uber,” University of Chicago Law Review Dialogue, 82(1), 2015, 85-102.
  11. For a thorough report on the impact of Airbnb on Toronto’s housing market see T. Wieditz, Squeezed Out: Airbnb’s Commercialization of Home-Sharing in Toronto. Toronto: Fairbnb.ca, 2017. The report and other data can be found at fairbnb.ca
  12. M. Lecuyer, M. Tucker, and A. Chaintreau, “Improving the Transparency of the Sharing Economy.” International World Wide Web Conference Committee (IW3C2), April 3–7, 2017, Perth, Australia published under Creative Commons CC BY 4.0 License WWW 2017 Companion, 2017.
  13. Recent data has found that 84% of Airbnb revenues in the GTA come from entire home rentals and 57% of revenues from multi-unit hosts. See HLT Advisory, AirBnB… & the Impact on the Canadian Hotel Industry, Ted Rogers School of Management, Toronto. June, 2016.
  14. D. Wachsmuth, D. Kerrigan, D. Chaney, and A. Shillolo Short-term cities: Airbnb’s impact on Canadian housing markets. A report from the Urban Politics and Governance research group School of Urban Planning McGill University. McGill University, Montreal, August 10, 2017.
  15. Bleecker Street in Cabbagetown is one such case. T. Kalinkowski, “Bleecker St. residents say ‘ghost hotels’ ruining neighbourhood,” Toronto Star, August 5, 2016.
  16. L. Xing, “Toronto condo signs on to 1st agreement in Canada to regulate Airbnb rentals,” CBC News, October 25, 2017.
  17. In 2016, Airbnb sued both New York and San Francisco over its regulations of short-term rentals. K. Benner, “Airbnb in Disputes with New York and San Francisco,” New York Times, June 28, 2016.
  18. A. Tattersall, and D. Reynolds, ‘The Shifting Power of labor-community coalitions: identifying common elements of powerful coalitions in Australia and the US’, WorkingUSA, 10, 2007, 77–102.
  19. Toronto City Council is scheduled to vote of AirBnB bylaws in early December 2017.
  20. J. Dias, Letter to Mayor John Tory and the Executive Committee EX26.3.29, June 16, 2017. A similar letter was submitted to Vancouver’s Mayor and City Council on October 24, 2017 as the city debates a short-term rental policy.
  21. S. Levin, “Airbnb’s controversial deal with labor union falls apart after intense backlash,” The Guardian, April 21, 2016.
  22. The company is hesitant to call these ‘hotels’ and prefers ‘branded home-sharing units’ or ‘community centres’.
  23. On the Magna deal see S. Gindin, “The CAW and Magna: What if Magna Builds an Assembly Plant?,” The Bullet, Socialist Project E-Bulletin No. 71, November 3, 2007.
  24. CBRE, An Overview of the AirBnB and the Hotel Sector in Canada, Hotel Association of Canada, Ottawa, 2017.
  25. Airbnb, ‘Airbnb names new Canadian Executive’, Press release posted on CNW, July 25, 2016.
  26. See T. Heffernan, “Mobilizing Workers at the Toronto Airport: Interview with Sean Smith,” The Bullet, Socialist Project E-Bulletin No. 1260, May 24, 2016.
  27. On this point see the recent books: I. MacDonald (ed), Unions and the City: Negotiating Urban Change. ILR Press, Ithaca, NY, 2017; M. Greenberg and P. Lewis (eds). The City is the Factory: New Solidarities and Spatial Strategies in an Urban Age ILR Press, Ithaca, NY, 2017.

Steven Tufts is an Associate Professor in Geography at York University.

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Book of the Day: Surveillance Valley: The Secret Military History of the Internet https://blog.p2pfoundation.net/book-of-the-day-surveillance-valley-the-secret-military-history-of-the-internet/2018/12/27 https://blog.p2pfoundation.net/book-of-the-day-surveillance-valley-the-secret-military-history-of-the-internet/2018/12/27#respond Thu, 27 Dec 2018 10:00:00 +0000 https://blog.p2pfoundation.net/?p=73849 Surveillance Valley: The Secret Military History of the Internet by Yasha Levine. In this fascinating book, investigative reporter Yasha Levine uncovers the secret origins of the internet, tracing it back to a Pentagon counterinsurgency surveillance project. A visionary intelligence officer, William Godel, realized that the key to winning the war in Vietnam was not outgunning... Continue reading

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Surveillance Valley: The Secret Military History of the Internet by Yasha Levine.

In this fascinating book, investigative reporter Yasha Levine uncovers the secret origins of the internet, tracing it back to a Pentagon counterinsurgency surveillance project.

A visionary intelligence officer, William Godel, realized that the key to winning the war in Vietnam was not outgunning the enemy, but using new information technology to understand their motives and anticipate their movements. This idea–using computers to spy on people and groups perceived as a threat, both at home and abroad–drove ARPA to develop the internet in the 1960s, and continues to be at the heart of the modern internet we all know and use today. As Levine shows, surveillance wasn’t something that suddenly appeared on the internet; it was woven into the fabric of the technology.

But this isn’t just a story about the NSA or other domestic programs run by the government. As the book spins forward in time, Levine examines the private surveillance business that powers tech-industry giants like Google, Facebook, and Amazon, revealing how these companies spy on their users for profit, all while doing double duty as military and intelligence contractors. Levine shows that the military and Silicon Valley are effectively inseparable: a military-digital complex that permeates everything connected to the internet, even coopting and weaponizing the antigovernment privacy movement that sprang up in the wake of Edward Snowden.

With deep research, skilled storytelling, and provocative arguments, Surveillance Valley will change the way you think about the news–and the device on which you read it.


You can read an extract from Surveillance Valley published in the Guardian here: Google’s Earth: how the tech giant is helping the state spy on us

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