This article is excerpted from my new book Banking on the People: Democratizing Money in the Digital Age, available in paperback June 1.

The U.S. federal debt has more than doubled since the 2008 financial crisis, shooting up from $9.4 trillion in mid-2008 to over $22 trillion in April 2019. The debt is never paid off. The government just keeps paying the interest on it, and interest rates are rising.

In 2018, the Fed announced plans to raise rates by 2020 to “normal” levels — a fed funds target of 3.375 percent — and to sell about $1.5 trillion in federal securities at the rate of $50 billion monthly, further growing the mountain of federal debt on the market. When the Fed holds government securities, it returns the interest to the government after deducting its costs; but the private buyers of these securities will be pocketing the interest, adding to the taxpayers’ bill.

In fact it is the interest, not the debt itself, that is the problem with a burgeoning federal debt. The principal just gets rolled over from year to year. But the interest must be paid to private bondholders annually by the taxpayers and constitutes one of the biggest items in the federal budget. Currently the Fed’s plans for “quantitative tightening” are on hold; but assuming it follows through with them, projections are that by 2027 U.S. taxpayers will owe $1 trillion annually just in interest on the federal debt. That is enough to fund President Donald Trump’s trillion-dollar infrastructure plan every year, and it is a direct transfer of wealth from the middle class to the wealthy investors holding most of the bonds.

Where will this money come from? Crippling taxes, wholesale privatization of public assets, and elimination of social services will not be sufficient to cover the bill.

Bondholder Debt Is Unnecessary

The irony is that the United States does not need to carry a debt to bondholders at all. It has been financially sovereign ever since President Franklin D. Roosevelt took the dollar off the gold standard domestically in 1933. This was recognized by Beardsley Ruml, Chairman of the Federal Reserve Bank of New York, in a 1945 presentation before the American Bar Association titled “Taxes for Revenue Are Obsolete.”

“The necessity for government to tax in order to maintain both its independence and its solvency is true for state and local governments,” he said, “but it is not true for a national government.” The government was now at liberty to spend as needed to meet its budget, drawing on credit issued by its own central bank. It could do this until price inflation indicated a weakened purchasing power of the currency.

Then, and only then, would the government need to levy taxes — not to fund the budget but to counteract inflation by contracting the money supply. The principal purpose of taxes, said Ruml, was “the maintenance of a dollar which has stable purchasing power over the years. Sometimes this purpose is stated as ‘the avoidance of inflation.’”

The government could be funded without taxes by drawing on credit from its own central bank; and since there was no longer a need for gold to cover the loan, the central bank would not have to borrow. It could just create the money on its books. This insight is a basic tenet of Modern Monetary Theory: the government does not need to borrow or tax, at least until prices are driven up. It can just create the money it needs. The government could create money by issuing it directly; or by borrowing it directly from the central bank, which would create the money on its books; or by taking a perpetual overdraft on the Treasury’s account at the central bank, which would have the same effect.

The “Power Revolution” — Transferring the “Money Power” to the Banks

The Treasury could do that in theory, but some laws would need to be changed. Currently the federal government is not allowed to borrow directly from the Fed and is required to have the money in its account before spending it. After the dollar went off the gold standard in 1933, Congress could have had the Fed just print money and lend it to the government, cutting the banks out. But Wall Street lobbied for an amendment to the Federal Reserve Act, forbidding the Fed to buy bonds directly from the Treasury as it had done in the past.

The Treasury can borrow from itself by transferring money from “intragovernmental accounts” — Social Security and other trust funds that are under the auspices of the Treasury and have a surplus – but these funds do not include the Federal Reserve, which can lend to the government only by buying federal securities from bond dealers. The Fed is considered independent of the government. Its website states, “The Federal Reserve’s holdings of Treasury securities are categorized as ‘held by the public,’ because they are not in government accounts.”

According to Marriner Eccles, chairman of the Federal Reserve from 1934 to 1948, the prohibition against allowing the government to borrow directly from its own central bank was written into the Banking Act of 1935 at the behest of those bond dealers that have an exclusive right to purchase directly from the Fed. A historical review on the website of the New York Federal Reserve quotes Eccles as stating, “I think the real reasons for writing the prohibition into the [Banking Act] … can be traced to certain Government bond dealers who quite naturally had their eyes on business that might be lost to them if direct purchasing were permitted.”

The government was required to sell bonds through Wall Street middlemen, which the Fed could buy only through “open market operations” – purchases on the private bond market. Open market operations are conducted by the Federal Open Market Committee (FOMC), which meets behind closed doors and is dominated by private banker interests. The FOMC has no obligation to buy the government’s debt and generally does so only when it serves the purposes of the Fed and the banks.

Rep. Wright Patman, Chairman of the House Committee on Banking and Currency from 1963 to 1975, called the official sanctioning of the Federal Open Market Committee in the banking laws of 1933 and 1935 “the power revolution” — the transfer of the “money power” to the banks. Patman said, “The ‘open market’ is in reality a tightly closed market.” Only a selected few bond dealers were entitled to bid on the bonds the Treasury made available for auction each week. The practical effect, he said, was to take money from the taxpayer and give it to these dealers.

Feeding Off the Real Economy

That massive Wall Street subsidy was the subject of testimony by Eccles to the House Committee on Banking and Currency on March 3-5, 1947. Patman asked Eccles, “Now, since 1935, in order for the Federal Reserve banks to buy Government bonds, they had to go through a middleman, is that correct?” Eccles replied in the affirmative. Patman then launched into a prophetic warning, stating, “I am opposed to the United States Government, which possesses the sovereign and exclusive privilege of creating money, paying private bankers for the use of its own money. … I insist it is absolutely wrong for this committee to permit this condition to continue and saddle the taxpayers of this Nation with a burden of debt that they will not be able to liquidate in a hundred years or two hundred years.”

The truth of that statement is painfully evident today, when we have a $22 trillion debt that cannot possibly be repaid. The government just keeps rolling it over and paying the interest to banks and bondholders, feeding the “financialized” economy in which money makes money without producing new goods and services. The financialized economy has become a parasite feeding off the real economy, driving producers and workers further and further into debt.

In the 1960s, Patman attempted to have the Fed nationalized. The effort failed, but his committee did succeed in forcing the central bank to return its profits to the Treasury after deducting its costs. The prohibition against direct lending by the central bank to the government, however, remains in force. The money power is still with the FOMC and the banks.

A Model We Can No Longer Afford

Today, the debt-growth model has reached its limits, as even the Bank for International Settlements, the “central bankers’ bank” in Switzerland, acknowledges. In its June 2016 annual report, the BIS said that debt levels were too high, productivity growth was too low, and the room for policy maneuver was too narrow. “The global economy cannot afford to rely any longer on the debt-fueled growth model that has brought it to the current juncture,” the BIS warned.

But the solutions it proposed would continue the austerity policies long imposed on countries that cannot pay their debts. It prescribed “prudential, fiscal and, above all, structural policies” — “structural readjustment.” That means privatizing public assets, slashing services, and raising taxes, choking off the very productivity needed to pay the nations’ debts. That approach has repeatedly been tried and has failed, as witnessed for example in the devastated economy of Greece.

Meanwhile, according to Minneapolis Fed president Neel Kashkari, financial regulation since 2008 has reduced the chances of another government bailout only modestly, from 84 percent to 67 percent. That means there is still a 67 percent chance of another major systemwide crisis, and this one could be worse than the last. The biggest banks are bigger, local banks are fewer, and global debt levels are higher. The economy has farther to fall. The regulators’ models are obsolete, aimed at a form of “old-fashioned banking” that has long since been abandoned.

We need a new model, one designed to serve the needs of the public and the economy rather than to maximize shareholder profits at public expense.

_____________________

An earlier version of this article was published in Truthout.org. Ellen Brown is an attorney, founder of the Public Banking Institute, and author of thirteen books including Web of Debt and The Public Bank Solution. Her latest book is Banking on the People: Democratizing Money in the Digital Age, published by the Democracy Collaborative. She also co-hosts a radio program on PRN.FM called “It’s Our Money.” Her 300+ blog articles are posted at EllenBrown.com.

The post The Bankers’ “Power Revolution”: How the Government Got Shackled by Debt appeared first on P2P Foundation.

Written by Dana Brown, Director, The Next System Project. Article reposted from The Next System Project

They are our collective heritage as a species—both those resources which we inherit from previous generations and those which we create—managed in such a way as to preserve shared values and community identity. The commons are the collective resources themselves, and the practice of collective economic production and social cooperation used to steward those resources—as well as the values of equity and fairness that underpin them—is often referred to as commoning. Many resources can be managed as commons (though often there are attempts to privatize or “enclose” many of those same resources). These can include knowledge, urban space, land, blood banks, seed banks, the internet, open source software and much more.

Potential Impact

The commons are pervasive and as such, often go unnoticed. However, their thriving existence alongside forms of private and public ownership provides a framework for understanding and creating social value beyond the confines of conventional economics.

The rich traditions and successes of commoning provide models for how to push back against privatization and enclosure, ensuring common resources are protected for future generations. Meanwhile, political economist Elinor Ostrom’s Nobel Prize-winning work has disproved the enduring “tragedy of the commons” hypothesis that collectively managed natural resources would necessarily be overexploited and destroyed over the long term.

Taxing the private use of common resources, combined with
redistribution or other efforts to formalize “commons trusts” to ensure their sustainable stewardship, could help stem the tide of privatization and extraction. The tax proceeds could be used as a form of reparation to communities that have traditionally borne the brunt of extraction of their common resources, and to restore those resources when depleted.

Transformative Characteristics

Commoning is a generative and “value-making” process that can decommodify land and other resources, and demonstrate that communities can manage them effectively without private control or state governance. It asserts a different “universe of value” and worldview from capitalism and unfettered consumerism, and helps communities break free from the scarcity mindset of capital. “The commons does not compete on p rice or quality, but on cooperation,” says commons activist and author David Bollier. It “‘out-cooperates’ the market … by itself eliciting personal commitment and creativity and encouraging collective responsibility and sustainable practices.”

The commons, and related peer-to-peer production models, offer concrete, replicable, and dynamic frameworks for sustainably managing existing resources and creating new ones. They also offer a model for deciding what not to produce in order to most effectively protect our global common resources.

Examples

WIKIPEDIA

Wikipedia is a form of online knowledge commons, “a multilingual, web-based, free-content encyclopedia project supported by the Wikimedia Foundation and based on a model of openly editable content.” It contains more than 5 million encyclopedia entries (a shared resource), created and edited by its authors and editors (a community) with a set of community-determined content and editing guidelines (rules). Wikipedia displaced once-expensive bound encyclopedias to become one of the world’s largest reference websites, attracting hundreds of millions of unique users per month and engaging over 140,000 active users—a group that anyone with an internet connection can join—in creating and editing content in almost 300 languages.

EL PARQUE DE LA PAPA

Peru’s “potato park” is a community-led conservation project that preserves traditional customs and indigenous rights to the “living library” of genetic information contained in the over 900 varieties of potato found in the Inca Valley region. The native Quechua peoples bred and cultivated these potato varieties for centuries, but biotech and agricultural corporations moved to appropriate the genetic information in the seeds and take commercial control without the consent of the Quechua people. They then forced the Quechua to pay for the seeds their ancestors had worked so hard to breed and protect. Indigenous representatives organized and successfully negotiated the repatriation of the potato varieties and the rights to conserve them in a 32,000-acre potato park. More than 8,000 community members now collectively manage the park  to “promote the cultivation, use and maintenance of diversity of traditional agricultural resources” and to ensure their traditional agricultural resources do not become subject to private intellectual property rights.

Challenges

Most people are not aware of the pervasiveness and enduring nature of the commons and don’t understand commoning as a viable alternative to consumption-driven and competitive economics. The increasing enclosure and privatization of the commons is erasing our collective memory of many enduring commoning practices. For example, control of the majority of the global seed market (a resource once managed as a commons in many communities) is now concentrated in a handful of multinational corporations. Furthermore, scarcity of some common resources may intensify competition for control in the coming years, while others lack adequate infrastructure support and are therefore vulnerable to privatization.  

More Resources

• The Commons Transition Primer:  https://primer.commonstransition.org

• News, analysis and resources on the commons: www.bollier.org

The post The commons appeared first on P2P Foundation.

This piece by Michel Bauwens and Vasilis Kostakis was originally published on The Next System.org.

Download PDF here.

Why is this emerging mode of production so important in discussions about post-capitalist futures? And how can participants in commons-based peer production— the “commoners”—make sustainable livings, thereby creating a thriving global commons economy within and beyond capitalism?

Here’s why and how.

Introduction: Two big questions

When we investigate realistic social change, it is not enough to ask (normatively) how things should be or (idealistically) how things could be. We must also look at the seeds of potential change. Just as capitalism developed over centuries by combining such patterns as double-book accounting and knowledge diffusion through printing, any post-capitalist system will be grounded in patterns emerging within capitalism or from attempts to solve its systemic problems.

These post-capitalist patterns include commons-based peer production. John Restakis (2017), David Bollier (2016), and others have addressed the re-emergence of the commons, defined as a shared resource, maintained or co-created by a community, and governed through that same community’s rules and norms. Here we go one step farther, describing an emerging mode of production that makes the commons the central feature of its value creation and distribution.

This new modality of value creation has fresh but widespread roots. It emerged in the digital realm to organize the production of open knowledge, free software, and shared designs. Now, it is also a strong candidate to take over the organization of physical production and create a political economy in which the distribution of value is both more socially just and ecologically regenerative. As we will show, forces already afoot could produce and distribute value in socially fair and environmentally balanced ways.

Commons-based peer production as a new pattern of value creation for digital production

In commons-based peer production (CBPP), originally identified as a new pathway of value creation and distribution, Internet-enabled infrastructures allow individuals to communicate, self-organize, and co-create digital commons of knowledge, software, and design (Benkler, 2006; Bauwens, 2005; Kostakis & Bauwens, 2014). Think of the free encyclopedia Wikipedia, the myriad free and open-source projects (e.g., Linux, Apache HTTP Server, Mozilla Firefox, WordPress, Enspiral), or such open design communities as Wikihouse, RepRap, Sensorica, and Farm Hack. This remarkable new modality combines global coordination mechanisms with the small-group dynamics characteristic of human tribal forms, allowing these dynamics to go global.

Post-capitalist characteristics

CBPP differs fundamentally from value creation under industrial capitalism. In the incumbent models, the owners of the means of production hire workers, direct the work process, and sell products for profit maximization. Production is organized by allocating resources through price signals, or through hierarchical command harking to these price signals.

In contrast, CBPP is in principle open to anyone with skills to contribute to a joint project, pooling the knowledge of every participant. Some participants may be paid by companies or clients, but this system of production is also open to self-motivated contributors and distributors. In these open systems, there are many reasons to contribute beyond or besides receiving monetary payment.

CBPP allows contributions based on all kinds of motivations, but most important is the desire to create something meaningful or mutually useful to those contributing. For the productive communities as well as other users, most of their work is oriented to use-value creation, not exchange-value. In CBPP’s open and transparent systems, everyone can see the signals of others’ work and can that way adapt to the needs of the system as a whole.

Stigmergic collaboration

In CBPP, some commoners may be paid or employed as wage labor or work for the market as freelancers. Whether paid or not, all of them produce commons. The work is not directed by corporate hierarchies, but through the mutual coordination mechanisms of the productive community. Indeed, corporate hierarchies must defer to the community values if they want to participate in this type of production. In CBPP’s open and transparent systems, everyone can see the signals of others’ work and can that way adapt to the needs of the system as a whole.

CBPP is often based on ‘stigmergic’ collaboration. Basically, stigmergy is the phenomenon of indirect communication among agents and actions (Marsh & Onof, 2007, p. 1). Think here about how ants or termites exchange information by laying down pheromones (chemical traces). This indirect form of communication enables social insects to build such complex structures as trails and nests. An action leaves a trace that stimulates the next action by the same or a different agent (ant, termite, or, in the case of CBPP, commoner).

In the context of CBPP, stigmergic collaboration is the “collective, distributed action in which social negotiation is …mediated by Internet-based technologies” (Elliott, 2006). For example, free and open-source software code lines and Wikipedia entries are all produced in a distributed and ad hoc manner as large numbers of people contribute.

Of course, unlike termites and ants, people are given to ego problems, mixed agendas, and other human frailties, so what about quality control? CBPP projects do have quality-control systems based on a hierarchy (or heterarchy). These safeguards are imperfect but improving. Without coercing work, “maintainers” in free and open source software collaboration or Wikipedia “editors,” for instance, protect the integrity of the system as a whole and can refuse contributions that endanger that integrity.

Far from the norm in traditional business, this kind of collaboration does appeal to profit-seekers, too. Since CBPP is based on more freely engaged and passionate labor and obviates some costs to capital, it can appeal to for-profit forces. Hence, we see the massive growth of CBPP in software production for industry.

A new institutional ecosystem

Through CBPP, we see a new institutional ecosystem of value creation emerging. This ecosystem consists of three institutions: the productive community, commons-oriented entrepreneurial coalition(s), and the for-benefit association. Our description cannot be all-inclusive or definitive because each ecosystem is unique and this new mode of production is rapidly evolving. The aim instead is to offer a birds-eye-view of the expanding universe of CBPP.1

^{Five of the oldest and best-known commons-based peer production ecosystems.}

Along with Wikipedia and the well-documented ecosystems of the free and open-source software projects, Enspiral, Sensorica, Wikihouse, and Farm Hack offer new perspectives on the rich tapestry of proliferating CBPP ecosystems. All can be described as building new post-capitalist ecosystems of value creation, and all illustrate the shift from the purely digital production of software and knowledge to its use by entities that produce physical products and sophisticated services. Enspiral has a complex service offering, including the participatory decision-making platform Loomio, Sensorica designs and deploys sensors, Wikihouse produces designs for sustainable housing, and Farm Hack engages in the participatory design of agricultural machinery. All four replay the tripartite institutional structure emblematic of digital production. A recent study of the urban commons in Ghent (Bauwens & Onzia, 2017) shows that commons-based urban provisioning systems also exemplify this new structure.

^{Three emerging commons-based peer production ecosystems.}

The first linchpin of the new model is the productive community. It consists of all the contributors to a project of CBPP. As noted, its members may be paid or may volunteer their contributions out of sheer interest. Either way, all produce the shared resource. Most important when compared to systems based on wage labor, the system must remain open to contributions.

The second institution is the commons-oriented entrepreneurial coalition. It aims to create either profits or livelihoods by creating added value for the market, based on the shared resources. The participating enterprises can pay contributors.

The digital commons themselves are typically outside the market because they are not scarce so are not subject to the laws of supply and demand.

Crucially important in the relation among the entrepreneurs, the community, and the common-pool resource on which they depend is whether their relationship is generative or extractive. That said, every entity is expected to present a mixture.

Two distinctions are relevant here. First, entrepreneurship should not be identified exclusively with capitalism: not all entrepreneurs are motivated by profit maximization. For some, entrepreneurship expresses the desire for autonomy. In the emerging class of autonomous and precariously employed workers, many are involved in the “auto-entrepreneurship” crucial to CBPP ecosystems. Entrepreneurship should not be identified exclusively with capitalism.

Second, markets should not be identified with capitalism. Non-capitalist market systems that are not based on wage labor or the separation of the means of production from the workers, and that operate with different “value logics” than profit maximization, have existed throughout history. They still coexist within capitalism and can be further developed as post-capitalist modalities. CBPP’s potential here is to create commons-oriented market forms that both benefit the commons and the commoners.

Crucial to the “commonification” of the entrepreneurial coalitions is the figure of the “autonomous worker.” Today’s dominant conception of the entrepreneur is of someone who is independent and takes all the risk to play the capitalist lottery. In contrast, if you want a salary, then you need to obey corporate rules. So, if you are a worker, you have a contract of subordination. In contrast, autonomous workers are free to make their own decisions and interact with the market and the commons as they wish and without permission.

This form of self-propelled enterprise should not be confused with neoliberal entrepreneurship. From a Gramscian perspective (Gramsci, 1971), CBPP can be viewed as an effort to advance alternatives to dominant ideas of what is considered “normal” and legitimate. Commons-based entrepreneurship places freedom and autonomy associated with entrepreneurship in a contributory perspective.

Consider here the creation of the labor mutual SMart, which advances the concept of “autonomous worker.” Participating workers freely engage with the market to advance their values and life projects, but mutualize their life risk through a co-owned cooperative. Such workers are ideally situated to join more commons-centric models.

Marjorie Kelly (2012) introduces non-capitalist/generative enterprises, pressing the distinction between markets and capitalism. In these enterprises, collectively owned market agents use their surplus to further social and environmental causes, rather than accumulation. To demonstrate the difference between extractive and generative economic activity, think of industrial agriculture versus permaculture. In the former, the soil grows ever poorer and less healthy while in the latter the soil becomes richer and healthier.

Extractive entrepreneurs seek to maximize their profits, and few of this breed reinvest enough in the maintenance of the productive communities. Like Facebook, they do not share any profits with the co-creating communities that provide the company’s value and its realization. Some, like Uber or Airbnb, tax exchanges without creating transport or hospitality infrastructures. So, though such enterprises develop useful services based on previously untapped resources, they do so extractively. They facilitate these services, but they also create competitive mentalities that destroy the collaborative and environmental advantages of mutualizing pooled resources. Moreover, extractive enterprises may free-ride on social or public infrastructures (e.g., roads in Uber’s case) and further undermine welfare provision by evading taxation and failing to provide social benefits. To demonstrate the difference between extractive and generative economic activity, think of industrial agriculture versus permaculture.

In contrast, generative entrepreneurs add value to these communities, which they both seed and depend on. In the best case, the community of entrepreneurs and the productive community are one and the same. Creating livelihoods while producing commons, contributors re-invest the surplus in their well-being and the overall commons system they co-produce.

The third institution is the for-benefit association. This entity can be seen as the infrastructural organization of the commons that manages commons-based cooperation. Indeed, many CBPP ecosystems feature independent governance institutions that support the infrastructure for collaboration, empowering the CBPP. Cooperation thus takes place autonomously, without any command-and-control apparatus. Indeed, commoning is impossible without it. For example, the Wikimedia Foundation is the non-coercive for-benefit association of Wikipedia. Similarly, free and open-source software foundations often manage infrastructure and networks of projects.

Traditional nongovernmental and nonprofit organizations operate in a world of perceived scarcity. They spot problems, search for resources, and direct their resources toward solving the issues they have identified. This approach arguably mirrors the for-profit model of operating.

In contrast, for-benefit associations operate for ‘potential’ abundance. They recognize problems and issues but believe that there are enough contributors eager to help solve or resolve them. Hence, they maintain an infrastructure of cooperation that allows contributive communities and entrepreneurial coalitions to engage in CBPP processes vital for addressing these issues, without directly commanding the contributors. They protect these commons through licenses and may also help manage conflicts between participants and stakeholders, fundraise, and help build the general capacity needed to work in particular fields through, for example, education or certification.

The specific CBPP ecosystems are interrelated through their digital commons. Since the output of one project can be the input of another, CBPP can be seen as a grand ecosystem composed of diverse smaller ecosystems.

Overcoming the commons-capital contradictions towards an integrated economic reality

The nascent ecosystems described here are not sovereign in the current political economy, and all come with challenges and contradictions. For instance, Enspiral owes its business success largely to the distinct talent and skills of its members who are very competitive in their respective fields and who acquired skills and experiences from their education and occupations in such traditional institutions as universities, software companies, and financial firms. Beyond that, its area of expertise fills a niche in a developed market with low capital entry. Enspiral’s business model may be hard to replicate absent these factors.

Similarly, Sensorica and Farm Hack both face significant challenges concerning proper and comprehensive documentation of their processes and outputs, while WikiHouse is still striving to broaden the scope and reliability of its layouts and technologies. All the described projects, especially those entailing localized manufacturing, still rely substantially on cheap, mass-produced raw materials and components. Their business models, not yet fully defined, can sustain livelihoods for only a small number of active and highly dedicated contributors.

These caveats notwithstanding, don’t underestimate the importance of examples like those sketched here in solving urgent and neglected societal challenges. These new initiatives are gradually building considerable capacity to support this emerging commons-based political economy. Each case offers unique techno-social solutions, crystallizing a new socially embedded perception of value, defining new forms of organization and relationships to the means of production, and providing a new and more holistic representation of economic reality.

As these solutions mature and get adopted, replicated, and improved by other projects, this new economic reality could subsume and transcend today’s tumbling political order. Empowered by commoning, in time they will reshape and sublate the current contradictions and processes into a synthesized, concrete, commons-centric totality.

To be sure, the autonomous emergence and development of these seed forms are by themselves not a sufficient condition for social change. But they are a necessary feature of such change and their prefigurative function and power are vital to the success of any social change strategy. No conflict or crisis resolution can occur without reliance on these seeds of change.

From seed form to societal form

Make no mistake: the new models of production described here as an emerging institutional infrastructure at the micro level of concrete projects are also potential formats for a new post-capitalist political economy and civilization:

• The productive community at the heart of contributory value creation is also a model for a new type of civil society and for the central institution of a new post-capitalist economic and civilizational model. In this model of a productive civil society, citizens are also recognized for their contributions to society through CBPP.
• The entrepreneurial coalitions, which are generatively co-creating added value to the human and natural commons, are a model for a generative and ethical market.
• The infrastructural for-benefit associations are a model for enabling and empowering the state, which ensures the contributory equipotential capacity of its citizens and inhabitants.

Commons for the commoners, commodity for the capitalists

In CBPP, contributors create shared value through open contributory systems, govern their work through participatory practices, and create shared resources that can, in turn, be used in new iterations. This cycle of open input, participatory process, and commons-oriented output can be considered a cycle of accumulation of the commons, and this cycle parallels capital accumulation.

At this stage, CBPP prefigures what could become a post-capitalist mode of production. It is a prototype since it cannot yet fully reproduce itself outside of mutual dependence with capitalism. Productive and innovative “within capitalism,” CBPP also has the capacity to solve some of the structural problems generated by capitalism—in effect, transcending it. That said, CBPP won’t be the new “total social reality” until it also engages in physical production. The new models of production described here as an emerging institutional infrastructure at the micro level of concrete projects are also potential formats for a new post-capitalist political economy and civilization.

As for capitalist competition, CBPP can spur innovation. Firms that can access the digital commons possess a competitive advantage over firms that use proprietary knowledge and rely only on their research (Tapscott & Williams, 2005; Benkler 2006; von Hippel, 2017). For example, by mutualizing the software development in an open network, firms save substantially on their infrastructural investments. In this context, CBPP could be seen as a mutualization of productive knowledge by capitalist coalitions.

This capitalist investment is not negative in itself. Instead, it is a condition that has increased society’s investment in a commons-oriented transition. Since CBPP solves some structural issues of the current system, capital and both productive and managerial classes gravitate toward it. Even though prolonging the dominance of the old economic models distorts CBPP, it simultaneously sparks new ways of thinking that undermine in that dominance.

Even so, the new class of commoners cannot rely on capitalist investment and practices. Marinus Ossewaarde’s and Wessel Reijers’s (2018) threefold observation rings true here: “(1)…through technologically mediated practices of digital commoning implicit and explicit pricing mechanisms can be realised, (2)…such mechanisms draw the practices of digital commoning towards the monetary economy, (3) which in turn affects the forms of resistance that are implied in practices of digital communing.”

In the end, commoners must render CBPP more autonomous from the dominant political economy. Eventually, the balance of power could then be reversed: the commons and its social forces would become society’s dominant modality, forcing the state and market modalities to adapt to societal requirements.

Reverse cooptation

Commoners should avoid situations in which capitalists co-opt the commons and head toward situations in which the commons capture capital and use it to build its own capacity. Such reverse cooptation has been called “transvestment” by Dmytri Kleiner and Baruch Gottlieb (Kleiner, 2010, 2016). In the case of CBPPs, value would flow from the capitalist market to the commons, using generative market practices whenever possible. Thus, transvestment would help commoners become financially secure and independent. Such procedures are being developed and implemented in seed form by such open cooperatives as Sensorica or the Enspiral network.

Sensorica is a collaborative network that develops sensors. It was officially launched in 2011 in Montreal, Canada, inspired by free and open-source projects and the forms of collaboration they entailed. Sensorica explicitly separates its production processes, which are commons-based, from its market operations, which are held by independent entities though controlled by the productive network. The network’s contribution-based accounting system logs every contribution by every project participant at every stage, from initiation to marketing. In turn, all revenue from marketable products is distributed back to those who have contributed to their production. By providing livelihood opportunities, Sensorica emancipates its contributors so they can commit more of their creative energy to commons-based productive processes.

As for structure, the Enspiral network consists of the Enspiral ventures, the Enspiral Foundation, and a community of professionals representing various domains and a broad range of competencies. The Enspiral ventures offer their products and services in the market, like any common enterprise, but their focus is on the social economy, and they mobilize in response to societal challenges. Through this process, they create commons (software, infrastructures, knowledge—most famously, Loomio, a web application that helps groups make decisions together), but also revenue and (in some Enspiral ventures) even profits. A portion of these funds is donated to the Foundation. The latter then uses a part of them to cover its operation, and the rest is reinvested to new commons-based projects through democratic procedures. When projects are externally financed, the backing companies typically redeem their shares once an agreed-upon level of return has been reached. This agreement, combined with democratic control, allows the companies to decide to reinvest profits in their social mission and/or new Enspiral projects.

Open Cooperativism

Open cooperativism is a working concept aimed at infusing cooperatives with the basic principles of CBPP (Bauwens & Kostakis, 2014). Pat Conaty and David Bollier (2014) have called for “a new sort of synthesis or synergy between the emerging peer production and commons movement on the one hand, and growing, innovative elements of the co-operative and solidarity economy movements on the other.” To a higher degree than in traditional cooperatives, open cooperatives would statutorily be oriented toward the common good by co-building digital and/or material commons. This orientation basically extends the seventh cooperative principle—concern for the community (ICA, 2018). In contrast to traditional cooperatives, open cooperatives pool their digital resources (knowledge, software, designs), creating a multifaceted digital commons for other open cooperatives. So, open cooperatives would internalize negative externalities, adopt multi-stakeholder governance models, help create immaterial and material commons, and be socially and politically organized around global concerns, even if they produce locally.

One way to understand open cooperativism is to look at how the medieval guild system functioned. A guild was an association of producers who oversaw the practice of their craft or trade in a particular geographical area. It had elements of a professional association, a trade union, a cartel, and a secret society. Externally, guilds sold their goods or services in the marketplace, but internally they were fraternities and solidarity systems. In a commons-centric economy, such efficiency and solidarity could be achieved through open participatory systems that would connect producers and consumer/user communities, as community-supported agriculture does now. By this token, the models proposed below would intertwine contributors with various roles into one solidarity ecosystem.

Beyond the classical corporate paradigm

Here, six interrelated strategies for post-capitalist entrepreneurial coalitions are outlined. All aim to go beyond the classical corporate paradigm and its extractive profit-maximizing practices to establish open cooperatives that cultivate a commons-oriented economy.

First, it is essential to recognize that closed business models are based on artificial scarcity. Although knowledge in digital form can be shared quickly and at low marginal cost, traditional firms may use artificial scarcity to extract rents from its creation. Through legal repression or technological sabotage, naturally shareable goods are sometimes made artificially scarce to generate extra profits (Kostakis et al., 2018). This is particularly galling when life-saving medicines or planet-regenerating technological knowledge are overpriced or unnecessarily scarce. Open cooperatives, in comparison, would refuse to generate revenue by making such abundant resources as knowledge artificially scarce.

Second, a typical CBPP project involves various distributed tasks, to which individuals can freely contribute. For instance, in the free and open-source software projects, participants contribute code, create designs, maintain websites, translate text, co-develop the marketing strategy, and offer user support. In this setup, salaries based on a fixed job description may not be the most appropriate way to reward contributors. An alternative is open value accounting or contributory accounting: any income from contributions flows to contributors according to the points accrued from their meaningful participation in collective production. This model could be an antidote to the tendency in many firms for a handful of well-placed contributors to capture the value co-created by a much larger community.

Third, open cooperatives could secure fair distribution and benefit-sharing of commonly created value through “copyfair” licenses (Bauwens & Kostakis, 2014). Today’s “copyleft” licenses—such as Creative Commons and the GNU Public License—allow anyone to reuse the necessary knowledge commons provided that changes and improvements are subsequently shared in that same commons. The hitch is that this framework fails to encourage reciprocity for commercial use of the commons or to foster a level playing field for commons-oriented enterprises. These shortcomings can be overcome through copyfair licenses that allow for sharing while also ingraining reciprocity. More particularly, these licenses preserve the right of sharing knowledge but predicate commercialization of any such knowledge commons on contributing to that commons. For example, the copyfair approach to licensing endorses the free and open-source software freedoms enshrined in the GNU Public License, but regulates profit-making potential. The Peer Production License is the first case of copyfair that restricts the usage of a digital commons to worker cooperatives (Kleiner, 2010). Further, the FairShares Association uses a Creative Commons non-commercial license for the general public but allows its members to use the content commercially.

Fourth, open cooperatives would use open designs to produce sustainable goods and services. For-profit enterprises often build planned obsolescence into products to maintain tension between supply and demand and maximize profits. Such obsolescence is a feature, not a bug. In contrast, open design communities do not have the same incentives to plan obsolescence (Kostakis et al., 2018).

Fifth, open cooperatives could reduce waste. The lack of transparency and penchant for antagonism among closed enterprises makes it hard for them to create a circular economy in which the output of one production process becomes an input for another. However, open cooperatives could develop ecosystems of collaboration through open supply chains. These chains may enhance the transparency of production processes so participants could adapt their behavior based on the knowledge available in the network. There is no need for overproduction once the realities of the network become common knowledge. Open cooperatives could then move beyond exclusive reliance on imperfect market price signals and toward mutual coordination of production, thanks to the combination of open supply chains and open value accounting.

Sixth, open cooperatives could mutualize both digital and physical infrastructures. Despite the justified critique it receives, the misnamed “sharing economy” of Airbnb and Uber does illustrate the potential for matching idle resources. Co-working, skill sharing, and ride sharing also exemplify the many ways in which we can reuse and share resources. With co-ownership and co-governance, a genuine sharing economy could use resources far more efficiently, aided by shared data facilities and manufacturing tools.

Cooperative ownership of platforms can also begin to reorient the platform economy around a commons-oriented model. The six practices highlighted here are already emerging in various forms but need to be more universally integrated. In our estimate, the primary aim for fostering a more commons-centric economy is to recapture surplus value that is now feeding speculative capitalism and reinvest it in the development of commons-oriented productive communities. Otherwise, CBPP’s potential will remain underdeveloped and subservient to the dominant system.

The challenge of physical production and the creation of sustainable production

Typically, the need for capital is dramatically higher for physical production, which requires natural resources, buildings, machines, and people. Clearly, assembling networked individuals requires substantially less capital. Nevertheless, as noted, CBPP cannot be considered a full mode of production unless it integrates both digital and physical production.

Building on the confluence of the digital commons of knowledge, software, and design with local manufacturing technologies, new models of physical production are emerging. They can be codified as “design global, manufacture local” (DGML). What is light (knowledge, design), this logic goes, becomes global, while what is heavy (machinery) is local and ideally shared. DGML demonstrates how a technology project can leverage the digital commons to engage the global community in its development, celebrating new forms of cooperation (Kostakis et al., 2018; Kostakis et al., 2015; Kostakis et al., 2016). Unlike large-scale industrial manufacturing, the DGML model emphasizes small-scale, decentralized, resilient, and locally controlled applications. DGML could recognize the scarcities posed by finite resources and organize material activities to conserve them. After all, since manufacturing is largely local, shipping costs are lower, and maintenance is easier. Manufacturers design products to last as long as possible under the DGML mantle, and knowledge and design are freely shared since there are no patent costs.

Already, we see a rich tapestry of DGML initiatives unfolding in the global economy that do not need a unified physical basis because their members are located all over the world. For example, consider the L’Atelier Paysan (France) and Farm Hack (U.S.), communities that collaboratively build open-source agricultural machines for small-scale farming or the OpenBionics project that produces open-sourced, low-cost designs for robotic and bionic devices or the RepRap community that creates open-source designs for 3D printers.

Cities around the world are partially embracing this shift, as evidenced in a study on the urban commons (Bauwens & Onzia, 2017). In Ghent, Belgium, nearly 500 urban commons were identified, a tenfold increase in 10 years, covering all the basic provisioning systems. Most of these commons-based forms, however, redistribute but don’t produce goods. For instance, car and bike-sharing schemes mutualize access to transport but do not manufacture the vehicles. Similarly, housing coops, co-housing, and community land trusts offer access to housing but do not “make” the housing.

A further limitation: Many generative projects remain fragmented and locally limited. As welcome as these initiatives’ rapid growth is, it’s not enough to turn the tide. Public-commons cooperation must be combined locally with community wealth building policies inspired by the models in Cleveland and Preston, UK. What’s more, transnational investment coalitions are needed to create global open depositories for setting up provisioning systems and mutual learning endeavors that are locally adapted but globally coordinated. Public-commons cooperation must be combined locally with community wealth-building policies inspired by the models in Cleveland and Preston, UK.

One fast-growing sector amid a more fundamental transformation is ahead of the game. It can create healthy food for urbanites, livelihoods for producers, multi-stakeholder governance systems involving both producers and consumers, and meaningful work in an integrated ecosystem. Indeed, 80 of the 500 projects identified in Ghent were food projects—organic farmers supplying food through various commons-based schemes. Such local agricultural production exemplifies CBPP’s next stage: the cosmo-local production of goods. This stage combines open global communities mutualizing production knowledge, distributed local production, and cooperative, generative organization of the productive ecosystem. The challenge—extending this model to the economy’s more capital-intensive sectors—is likely to require the commitment of both the public sector and the world of cooperative investment and financing.

The greatest challenge, however, remains creating sustainable modes of production. Kate Raworth (2017) has very usefully summarized what needs doing: fulfill humanity’s social needs without exceeding the carrying capacity of the planet and damaging the vital cycles and needed balanced ecosystems that sustain human life. Commoning is both green and efficient.

The commons will be a vital part of this strategy for human survival. Commoning requires pooling and mutualizing resources and infrastructures to replace the wasteful corporate competition that reflects the systematic externalization of social and environmental costs to keep expenses and prices as low as possible. In contrast, CBPP’s “collaborative advantage” is that it produces products and services for human need, at lower thermodynamic costs than capitalist production models (Piques & Rizos, 2017). For example, the associate car-sharing project in Ghent, Degage, uses 130 cars for 1,300 members, guaranteeing them full mobility while greatly lowering environmental costs. Studies of similar projects have shown that every shared vehicle can replace up to 13 private cars (Shaheen, 2017).

Commoning is both green and efficient. Commons-based organic food ecosystems do not pollute the groundwater, do not use toxic additives, and can use carbon-free transportation systems. As shown in the meta-historical comparisons of civilizational overshoots (Motesharrei et al., 2014), more equal access to the resources of life significantly reduces resource catastrophes and makes crisis periods less severe. Production models that use a “subsidiarity of material production” approach will dramatically cut transportation costs and needs while maintaining global cultural and technical cooperation.

The good news is that pioneering communities all over the world are developing many of the tools needed to make this shift. For example:

• open and contributive accounting systems, able to recognize and reward all contributions, not just market value, as pioneered by Sensorica and others,
• shared ecosystemic circular supply chains, as experimented by Provenance, the Oxchain research project, eventually using the eco-systemic shared accounting systems like the R-E-A system, integrated impact and/or biophysical accounting systems, allowing direct access to thermo-dynamic flows and expenditures, using “global thresholds and allocations,”
• non-ecologically destructive distributed ledger systems, such as the Holochain,
• token-based value systems, which allow programmable production based on various value logics.

Instead of conclusions: A drinking horn for the commons

In medieval times, drinking horns were often used by guilds communally to symbolize and promote conviviality, friendship, and solidarity among the members. These values proved of great importance to the prosperity of the guild (Rosser, 2015).

Needed now is a drinking horn for the commons to help make CBPP a dominant production modality. The guild system can inspire commoners looking for sustainable livelihoods. Our transitional vision includes commons-based networks of “neo-guilds” comprised of cooperatives and autonomous producers. These networks would produce value—a global commons for the commoners and the general public and a product to be sold to enterprises outside the commons.

The small-scale initiatives can now be influential on a larger scale, as nodes in a commons-based global network of local networks. Through digital commoning, grassroots initiatives can have both a local and global orientation: “the small and the local, when they are open and connected, can therefore become a design guideline for creating resilient systems and sustainable qualities, and a positive feedback loop between these systems” (Manzini, 2013). Hence, instead of “scaling-up,” CBPP initiatives are “scaling-wide.”

With a crisis of capital accumulation upon us, might a stream of value seek and find a place in the commons economy? Yes. Instead of the cooptation of the commons economy by capital through capitalist platforms that capture value from common enterprise (e.g., Facebook, Google, IBM), commoners can coopt capital inside the commons, and subject it to its rules. With a crisis of capital accumulation upon us, might a stream of value seek and find a place in the commons economy?

Much depends on whether we can pull off more sophisticated types of reverse cooptation. Commoners must create interconnected transvestment vehicles that admit capital disciplined by the new commons and market forms developed through CBPP. For example, “double-licensing” schemes require those who wish to capitalize to pay a license fee or join the commons-based neo-guild. This approach creates a flow of value from the system of capital to the system of the commons economy.

The ultimate vision for a new society is one of a civil society productive in its own right, not just an adjunct to the market and state. Under this new dispensation, the state enables free social production in a galaxy of interconnected, collaborative initiatives. True, CBPP does not solve many of today’s inequalities and systemic social unfairness, especially involving race and gender. Nor does it directly address the hidden environmental and social costs of digital technologies, which are energy-intensive throughout their life-cycle, from cradle to the grave. Also, low-wage laborers (often including children) work under inhumane circumstances so that ever more people in the advanced economies have access to cheap digital technologies. But these shortcomings and injustices can be addressed, and CBPP traces a unique grand institution dealing with value creation that is far removed from the catastrophic characteristics of modern capitalism. This connection to sustainability is likely to open up new spaces for a free, fair, and long-lived society.

Acknowledgments

Parts of this essay are based on the authors’ forthcoming open-access book (co-authored with Alex Pazaitis), titled Peer to Peer: The Commons Manifesto, to be published by University of Westminster Press. It also builds on Bauwens M. & Kostakis V. (2016). “Why Platform Co-ops should be Open Co-ops.” In Scholz

T. & Schneider N. (eds) Ours to Hack and Own: The Rise of Platform Cooperativism, a New Vision for the Future of Work and a Fairer Internet. New York, NY: OR Books, 163-166. Vasilis Kostakis acknowledges funding from the European Research Council (ERC) under the European Union’s Horizon 2020 research and innovation program (grant agreement No. 802512).

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• 1. These ecosystems have been thoroughly discussed by several studies. See indicatively Dafermos, 2012; Harhoff & Lakhani, 2016; Mateos-Garcia & Steinmueller, 2008; Weber, 2005; Benkler, 2006; von Hippel, 2017.

The post How to Create a Thriving Global Commons Economy appeared first on P2P Foundation.

The book showcases the wealth of transformative ideas that the international commons movement has to offer. With contributions by Kate Raworth, David Bollier, George Monbiot and many others, Our Commons is a political call to arms to all Europeans to embrace the commons and build a new Europe.

Commons Network’s very own Sophie Bloemen and Thomas de Groot worked on this book for almost two years, doing research and interviews, working with academics, policy makers, authors and activists to paint a colourful picture of the commons as the blueprint for a new future, one that is inclusive, ecologically sustainable, equitable, democratic, collaborative, creative and resilient.

Our Commons features reflections on the enclosure of knowledge and the monopolisation of the digital sphere, stories about renewable energy cooperatives and community foodwaste initiatives and urgent pleas to see the city as a commons and to treat health as a common good. Published by the Institute of Network Cultures, the book is first released online as an e-book, free for all to download and share and as a printable PDF. The book will also be available on a wide variety of print-on-demand platforms.

In the next few months, Commons Network will organise a number of official events around the book. Please get in touch at [email protected] if you are interested in hosting a book-launch with the editors and possibly with some of the contributors of the book. Off- and online media that are interested in publishing texts from the book or interviews with the editors and/or contributors are encouraged to reach out to [email protected].

Download the ePub or the print-PDF here and make sure to share this page with as many people as possible, using the hashtag #OurCommonsBook

For all further questions, press inquiries or event bookings, possible citations or cross-posting, or requests for hard-copy printed books, please do not hesitate to reach out to the editors, Thomas de Groot and Sophie Bloemen.

([email protected])

([email protected])

Reprinted from commonsnetwork, you can see the original post here.

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From Democracy at Work

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[S1 E1] Primitive or Original Accumulation Prof. Harvey talks about how capital came to power, the brutality and the violence with which capital came to be, and what it is.

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The following post by Will Ruddick is republished from Grassroots Economics

Bernard’s vision of diverse monetary eco-systems that support communities and the environment rather than extract from them, as they continue to do now, is the spark that moved me from physics in the US into economics in Kenya and is still the vision that motivates me and countless other community currency developers, researchers and activists. His vision preceded crypto currencies by decades. Back then, the only way we could move toward Bernard’s vision was by trial and error – creating currency after currency using paper bills or centralized databases.

I met Bernard Lietaer for the first time while implementing a small paper-based community currency program in three villages near Mombasa. He understood all the heart-wrenching challenges of fighting poverty and embraced me, knowing that the vision was true and we were doing our best with the sticks and stones we had to use. He spoke of Yin and Yang flows of different currencies for spending and savings and much more. The intricate dance and balance of these currencies working together was so tangible to him that you could feel it flowing through his whole being.

Connecting those early community currencies together into the ecosystem he envisioned wasn’t possible without blockchain. Bernard was convinced that solutions like the Bancor Protocol which allowed currencies to communicate with each other through and across blockchains was the key to scaling and viral growth. With Bernard as President of the Bancor Foundation and his ability to cut through the sensationalism of blockchain to its potential to empower humanity to develop sustainable and healthy monetary ecosystems – there was and is no place I would rather be. When asked to direct the foundation’s efforts on community currencies under his guidance, it was a dream come true. It is a great honor to walk in his footsteps and without him it is a great loss to me personally.

The world has lost a visionary that inspired and united people to fix fundamental flaws in our monetary systems, which are the root causes of poverty and massive human and environmental strife. As we thank him for opening the doors and dedicate our work toward his vision, let us ensure his message continues to flourish and inspire future generations – that we banish the concept of monetary monoculture and embrace the values that are within each of us as the fundamental units of a diverse ecosystem of currencies that connect us all together in love and allow us to heal our planet and ourselves.

Sincerely with Love, Inspiration and Celebration of a life well lived,

Will Ruddick

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The following abstract is republished from academia.edu.

BA Dissertation: In blockchain they trust. Now, power to the people or to the invisible hand? An analysis of the ideological tensions and affinities between crypto-libertarian and crypto-commonist visions, projects and aspirations for the blockchain revolution.

By Mateo Peyrouzet Garc’a-Si–eriz BA Dissertation University of Exeter Department of Social Sciences and International Studies, May 2018

Abstract

This dissertation provides an analysis of the ideological component behind the crypto-anarchist enthusiasm for the highly topical emerging technology of distributed ledger technology, commonly known as blockchain. Philosophy of technology scholars have drawn attention to the fact that technologies can possess political properties and serve to reinforce or challenge power structures. Public blockchains have an unquestionable social and political character due to their capacity to facilitate the emergence of cryptographic, decentralized and reliable peer-to-peer networks. The exponential adoption of this disruptive technology, which is poised to cause transformational changes across socio-technical systems and organizational structures, means that both its political properties and the ideological forces behind its development as a political technology must be recognized. Accordingly, this dissertation engages with some of the most ideologically-driven projects aiming to tap into blockchainÕs political and economic potential, namely those of Bitcoin, FairCoin, Democracy Earth and Bitnation. These projects exemplify what is posited as the main ideological cleavage within crypto-anarchism, which revolves around the privileged agent and vision that should be empowered and trusted to capture the decentralizing potential offered by blockchain technology. The paper offers an original contribution by conceptualizing the cleavage as separating; crypto-libertarians, whose neo-Hobbesian individualistic vision sees the invisible hand of the free market as the privileged agent driving a trustless technology; and crypto-commonists, whose collectivist vision regards blockchain as a trust-enabling technology that should be used to facilitate collaborative economic paradigms and participatory forms of e-democracy. The dissertation concludes that while both strands of blockchain enthusiasts have a shared interest in promoting personal privacy, radical transparency, and eroding the authority of nation-states, their diametrically opposed views on human nature and socio-economic organization seem presently irreconcilable. The research undertaken for this paper has covered a substantial breadth of the existing academic material concerning the philosophy and politics of blockchain technology, consulting books, journals, white papers and online articles. This dissertation contributes with an ideological conceptualization to the fields of techno-politics and blockchain studies, an academic intersection still in its infancy, but which will undoubtedly attract increasing academic attention.

Contents

Given the dissertation’s focus on ideological features, the first chapter is dedicated to framing a proper framework to understand the ideologies of crypto-libertarianism, which has been commented by several scholars, and crypto-commonism, a neologism proposed by this paper. The former is characterized by its individualist approach to human interaction, its capitalist approach to economic organization, and its market-based approach to governance. The latter is characterized by its collectivist view of social interaction, its commonist approach to economic organization, and its democratic approach to governance. Decades after the emergence of crypto-anarchism, these differences remain largely under-conceptualized in academic and informal circles, creating an epistemic void that requires attention given the relevance of these ideological forces in the digital era.

Having constructed the ideological profiles that configure the crypto-anarchist divide concerning blockchain technology’s political and economic potential, Chapter 2 will present the technical specifics of the technology and its ontological properties, situating it within the debate regarding the political nature of technologies that was mentioned earlier. Then, the philosophical and political values embodied and advanced by blockchain will be examined. This will make it easier to understand how crypto-libertarian and crypto-commonist ideas fit within the technical properties of blockchain technology and its potential applications.

Chapter 3 will evaluate the radically different socio-economic visions held by crypto-libertarians and crypto-commonists. By analysing Bitcoin and FairCoin it will be shown that a crypto-commonist approach prioritizes blockchainÕs potential to enhance collaborative models of economic organization and commons-based peer production, while the crypto-libertarian perspective revolves around blockchainÕs facilitation of a trustworthy platform for unfettered markets to emerge. Following this, a consideration of how blockchain can affect data ownership and privacy from governments and tech giants will bring to light several affinities within the crypto-anarchists, as well as other points of contention.

Finally, Chapter 4 will focus on several approaches to governance that have either been proposed or, indeed, been made possible by the decentralized and transparent qualities of blockchain technology. This chapter will look at how blockchain enthusiasts are aiming to transform voting, democracy and governance, focusing on Democracy Earth’s application of ‘liquid democracy’ through blockchain technology and Bitnation’s project of ‘decentralized borderless voluntary nations’ Pinpointing the differences between these approaches will provide a comprehensible image of the way in which positioning along the libertarian-commonist axis influences visions of governance in an ideal blockchain future. The dissertation finishes by answering the second question, concluding that although crypto-libertarians and crypto-commonists may share an interest in eroding the power of states and grounding socio-economic organization on voluntary interactions facilitated by blockchain technology, their ideological aspirations are ultimately incompatible. While crypto-anarchists may be seen as a single ideological force, their differing visions on whether blockchain projects should facilitate unfettered capitalism or a commonist and democratic system seem currently irreconcilable.

References

• Scott, Brett. Visions of a Techno-Leviathan: The Politics of the Bitcoin Blockchain. E- International Relations, 1 June 2014, www.e-ir.info/2014/06/01/visions-of-a-techno-leviathan-the-politics-of-the-bitcoin-blockchain/.

• De Filippi, Primavera, and Benjamin Loveluck. The Invisible Politics of Bitcoin: Governance Crisis of a Decentralised Infrastructure. Internet Policy Review, vol. 5, no. 3, 30 Sept. 2016
• Dyer-Witheford, Nick. Species-Being and the New Commonism: Notes on an Interrupted Cycle of Struggles. The Commoner , no. 11, 2006, pp. 15Ð32. (p. 30)
• Gielen, Pascal, and Nico Dockx. Exploring Commonism – A New Aesthetics Of The Real. Valiz, 2018
• Velasco, Pablo R. Computing Ledgers and the Political Ontology of the Blockchain. Metaphilosophy, vol. 48, no. 5, 2017, pp. 712Ð726. (p. 721)

Alternative Strategies

• Scott, Brett. How Can Cryptocurrency and Blockchain Technology Play a Role in Building Social and Solidarity Finance? United Nations Research Institute for Social Development, Feb. 2016. (p. 19)

Photo by tompagenet

The post Ideological Tensions and Affinities Between Crypto-Libertarian and Crypto-Commonist Visions appeared first on P2P Foundation.

WHEN: 21st March 2019 @ 5:00 pm – 7:00 pm
WHERE: University of Westminster (Room UG05); 309 Regent St; Marylebone, London W1B 2HT; UK
COST: Free

Michel Bauwens, Vasilis Kostakis & Alex Pazaitis (P2P Foundation) –Book Launch ‘Peer to Peer. The Commons Manifesto’ (University of Westminster Press)

Not since Marx identified the manufacturing plants of Manchester as the blueprint for the new capitalist society has there been a more profound transformation of the fundamentals of our social life. As capitalism faces a series of structural crises, a new social, political and economic dynamic is emerging: peer to peer.  What is peer to peer? Why is it essential for building a commons-centric future? How could this happen? These are the questions this seminar tries to answer.

Biography

Michel Bauwens is the Founder of the P2P Foundation and works in collaboration with a global group of researchers in the exploration of commons-based peer production, governance, and property.

Vasilis Kostakis is the Professor of P2P Governance at Tallinn University of Technology and Faculty Associate at Harvard University. He is also Visiting Professor at the Autonomous University of Barcelona. Vasilis is the founder of the P2P Lab and core member of the P2P Foundation.

Alex Pazaitis is a Core Member of the P2P Lab and a Junior Research Fellow at the Ragnar Nurkse Department, Tallinn University of Technology.

The post Book Launch: Peer to Peer: The Commons Manifesto appeared first on P2P Foundation.

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Experimentation with radically open and collaborative ways of producing knowledge and material artefacts can be found everywhere – from the free/libre and open-source software movement to citizen science initiatives, and from community-based fabrication labs and makerspaces to the production of open-source scientific hardware. Spurred on by the widespread availability of networked digital infrastructure, what such initiatives share in common is the (re)creation of knowledge commons, and an attempt to redistribute innovative agency across a much broader array of actors.

In this working paper we reflect on what these emerging practices might mean for helping to cultivate more equitable and sustainable patterns of global development. For many commentators and activists such initiatives promise to radically alter the ways in which we produce knowledge and material artefacts – in ways that are far more efficient, creative, distributed, decentralized, and democratic. Such possibilities are intriguing, but not without critical challenges too.

We argue that key to appreciating if and how collaborative, commons-based production can fulfil such promises, and contribute to more equitable and sustainable patterns of development, are a series of challenges concerning the knowledge politics and political economy of the new practices. We ask: what depths and forms of participation are being enabled through the new practices? In what senses does openness translate to the ability to use knowledge? Who is able to allocate resources to, and to capture benefits from, the new initiatives? And will open and collaborative forms of production create new relations with, or even transform, markets, states, and civil society or will they be captured by sectional interests?

Photo by CaZaTo Ma

Reposted from The Steps Centre

The post Essay of the Day: Open and Collaborative Developments appeared first on P2P Foundation.

Michel Bauwens, founder of P2P Foundation, had a fireside chat in the Commons Foundation Korea office on Oct 2. Titled “Blockchain and commons, the connecting link” the discussion focused mostly on the origin of commons and the open source movement.

Michel Bauwens interview in Germany during the meetup of PlatformCoop-Berlin

Below a partial summary of the lecture. For the last decade the Belgian activist has been researching how open source communities work and function. Market economies and capitalism are fundamentally based on the double entry ledger accounting, separation of capital and labor, private corporations, financing as well as technological breakthroughs from steam engine to internet. Open source communities are permissionless aggregations of people working on common projects, based not on commodity or labor, but based on contributions to create shared resources. These free aggregations around mutualized resources have no command hierarchy, but only a control hierarchy (i.e. there are gatekeepers, often called ‘maintainers’, who protect the integrity of the ecosystem). Open source communities are more inclusive, but also more competitive at the same time. When innovation becomes collective, they can outcompete isolated private companies, having more global and broader base of contributors than any single R&D department, no matter how big the company: e.g. Wikipedia is an open source encyclopedia that can not easily be replicated by private enterprises, nor even by the state. Commons are shared resources, managed by stakeholders or the communities of contributors in peer to peer (P2P) networks and governed by the norms and rules of the communities they serve. Primary ways people interacted through history were commons as in clans and tribes of the premodern collectivism era and later with corporative guilds in twelfth century Europe. According to Mr Bauwens capitalism deprived commons of natural resources: for example the common land in agriculture has seen its spaces appropriated through private property, while the excess number of landless farmers were forced to migrate and develop the industrial cities. There are four phases or types of commons: natural resources, social, open knowledge and urban commons. The latter are recently increasing exponentially in mobility, housing, food and energy projects to such an extent they are present in nearly every provisioning system where citizens can now choose between private, public and commons options. For example, in mobility there are private cars, public transportation but also shared transportation systems such as nonprofit or cooperative car-sharing; similarly for housing there are privately owned houses, public housing but also social or cooperative housing. When and where markets and states fail, civic associations are created to cope and this is what happened after the crisis of 2008, when urban commons started mushrooming. Urban commons are not generally producing but usually only redistributive initiatives, for example car sharing solutions redistribute mobility, but do not yet make cars. However food and energy commons are the two exceptions: organic agricultural commons do not split between consumption and production, but use commonly managed ecosystems, while renewable energy localize energy production closest to where consumption is needed. “Cosmo-local” production system can be simplified as follows: “everything light is shared and global, everything heavy is local” says Mr Bauwens. In this model, there is a convergence of social commons with the distributed manufacturing systems, that are currently coming online with the new technologies around 3D printing and which is distinct from the protectionist economic agenda of the Trump administration to repatriate manufacturing factories back to the US. In the cosmo-local model, intellectual property (IP) is globally shared in global open design communities.

Bettina Warburg, How the blockchain will radically transform the economy — TED 2016

“What do you need to do to scale this system globally?” Open source already means the cooperation and coordination of immaterial production at global scale, but in order to shift this model to physical production, it is necessary a particular kind of knowledge intermediation, i.e. accounting, and this is where the blockchain revolution comes in, by making possible global open and shared distributed ledgers where every transaction for physical goods can be verified. Accounting is at the core of civilization as it created the state system (the first writing found where ledgers in the Temple states of Sumer), while double entry book accounting, invented by Luca Pacioli, a Franciscan monk in 15th century Venice, sees the world in terms of the growth and accumulation of private assets, making possible the development of capitalism. Blockchain in this respect can be seen as making possible new forms of digital accounting that consist of ‘post-double-entry’ bookkeeping, namely: 1) open and contributive accounting (such as practiced by the Canadian Sensorica project), 2) REA (resource event action) ecosystem accounting, which let us see flows in shared circular economies involving multiple players and 3) biocapacity accounting, which is based on direct vision of the flows of matter and energy and therefore not only financially driven. Open shared ledgers are a key mutual coordination mechanism to shift open source coordination from software to manufacturing. This contributive accounting allows fairness, openness, transparency, security and environmental friendliness. All the necessary technologies and tools are already existing or in development, but are fragmented and not integrated yet. One P2P interoperable ledger for all could be scalable infinitely if it used the right distributed ledger technology. Asset based coins and mutual credit cryptocurrencies are necessary, since they link directly to natural resources and human labor, while purely supply-demand driven digital assets are mostly speculative and do not give a view of the real world.

Don Tapscott, How the blockchain is changing money and business — TED 2016

“How do we reward for these structured regenerative activities?” Capitalism rewards only extractive activities without consideration for externalities (in Microeconomics courses externalities are studied as cases of market failures). In welfare state model the state is outside the capitalist model, in a market model the role of the state is weakened even further. One solution could be to internalize externalities directly in the production system. Mr Bauwens mentions that a study on the top forty companies in France revealed that none of them would be profitable, if they internalized pollution costs. As an example of a potential alternative methodology to fund regenerative activities in a systematic way, Mr Bauwens mentioned the Regen Network, which proposes the concept of an “ecological state protocol”, verifying the state of an ecological resource, lodging it on the blockchain and tokenizing that value creation. For example, organic farming results in less polluted water, with water agencies saving millions of Euro, but these environmental benefits cannot be rewarded in the present system. There is a need for structured funding of regenerative work and activities, that minimize the human impact on the environment and reduce the use of limited natural resources. Market economies reward only values created within markets, redistributing them in the best case scenario, while other kind of values are ignored. Value creation should be centered around commons.

“What to do with the private sector?” Societies need to establish new economies for the common good, which can be made explicit with new indicators and metrics [Economy for the Common Good (CG) has developed a full CG financial reporting with balance sheet and a whole new more ethical economic model]. Economies should serve communities as constitutions already mandate that the economy should serve the common good : e.g. corporations performing common good results could be entitled to pay less taxes. “In France the Napoleonic code established in 1804 did not recognize commons, allowing only public or private aggregations; in US, whose legal framework was developed later in time, regulations are even more purely market based” said Mr Bauwens.

Capitalism is in structural crisis amidst combined environmental problems and social tensions (increased income inequality and youth under/unemployment). Mr. Bauwens suggests that capitalist market economies should transform in ethical market economies, in which markets are embedded and society functions around commons: if the final goal of companies is to maximize value for stakeholders, the definition of value should not be restricted to profits, but include broader social and ecological impacts. States should also facilitate the transition to commons oriented sharing economies without commanding, but by incentivizing mutualization in a shared and contributed way. Non profit car sharing program require only one hundred cars for one thousand persons, ceteris paribus guaranteeing full mobility with only 20% of the ecological footprint.

“What to do with the liberated resources from automation and optimization?” Basic income could be an alternative, although commons economies can redeploy work forces in different sectors: e.g. organic farming requires 12% of workforce in the countryside, compared to the current 2% occupied in the agricultural sector. According to Mr Bauwens organic small sized farming is profitable or breaking even, while extensive industrial farming is losing money (he says in Europe industrial farmers would have negative incomes without European subsidies, a statement to be verified). “How to drive the transition from market centric to commons centered societies and economies?” To indicate the potential speed of change, Bauwens says that guilds in the twelfth century Europe were formed in the span of seventy years, for example in Ghent a progressive and innovative area in Belgium. Today digital nomads are spread around the world, collaborating in co-working spaces scattered globally: in Thailand (where Mr Bauwens lived extensively in Chiang Mai) there is a community of open source activists and software developers of the Mozilla Foundation for instance and many are already making a living through the token economy or bounties. This under the radar trend may transform from trans-local civic power to a transnational one, aiming to change entire metropolitan areas: redefining societies and economies in two hundred cities can have eventually a global impact. Mr. Bauwens is convinced that shared economies are scalable and replicable anywhere, leading to a broader social change. He stresses that commons are not utopia, commons are not necessarily ideally inclusive and the network status of individuals can be fluid, contentious and difficult: but even if they are not ideal, they are necessary to transition to new systems.

Michel Bauwens: Are We Shifting to a New Post-Capitalist Value Regime? — Berkman Center for Internet & Society at Harvard University.

The two hours, dense in unconventional and anticonformist concepts and ideas from different fields (anthropology, history, economics, finance, sociology and technology) provoked many questions in the participants, but time was limited and translation consumed more than half of the time available. However good discussions usually end with more open questions than definitive answers, in this respect the fireside chat with Mr Bauwens was very insightful and stimulating to maintain a sane skepticism about the future: to suspend judgement and keep on searching.

Article revised on Oct 9 by Michel Bauwens and Ann Marie Utratel to clarify some of the point of views expressed during the lecture and following Q&A discussions.

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