On Chris Cook and the Open Capital Movement.
Last week I got an interesting email from Chris Cook, one of the former Directors of the International Petroleum Exchange, who is working on the development of a framework for cooperative capitalism on his site Open Capital where he develops alternatives to the existing financial structures based upon peer to peer credit models and investment models.
His “thesis is that the only thing holding back the development of a P2P society is the lack of a workable “Enterprise Model” (ie legal and financial structure). In this context, he writes “the UK government heplfully (but inadvertently) gave us one a few years ago with the “new” UK Limited Liability Partnership, which I call the “Open” Corporate. Integral to this is the concept of “ownership in common” ie neither “State” nor “Private” : “Open” nor “Closed” .
In reply, I had sent him a number of questions, reflecting my concerns that some so-called P2P initiatives do nothing to increase broad participation:
Does your type of P2P market, still use externalities without payment (environmental), and dump externalities; is such a market still based on power relationships, rather than truly informed by participative practices (fair trade being an example of an attempt to create a market outside pure power relations where an attempt is made to meet the cost of dignified social reproduction of the producers through negotiating both their desires and market realities)?
I also argued that true peer to peer results in non-reciprocal peer production, and is not a market.
To which Chris Cook replied that it was his view is “that there is no such thing as non-reciprocal exchange: there is always a “Value”, but that “some forms of “Value” in exchange are intangible and ineffable”?
He then quoted some important definitions:An Enterprise is defined for the purposes of this article as ‘any entity within which two or more individuals exchange Economic Value which, like Beauty, is in the eye of the Beholder and is defined for the purposes of this article as:
* Material Value such as Land, Commodities, Goods and Services;
* Intellectual Value such as music, video, the written word and software, which exists in the form of data, electronic or otherwise;
* Emotional Value at its most basic, the need to love and to be loved, but extending into the concept of Society;
* Spiritual Value who am I? Why am I here? Questions in relation to God and the relationship with the eternal.
Three forms of Enterprise are identified:
* the Charitable Enterprise where Material and Intellectual Value are exchanged for the Spiritual and Emotional Value of giving;
* the Social Enterprise a Public Enterprise open to all, where Material and Intellectual Value is freely exchanged;
* the Commercial Enterprise a ˜closed or Private Enterprise where Material and Intellectual Value is exchanged between a limited number of individuals but may be retained or distributed in whatever way the Members agree.
These definitions are embedded in a Metaphysics of Value and a Metaphysics of Quality inspired by the work of Robert Pirsig’s book (of “Zen and the Art of Motorcycle Maintenance” fame).
It would seem that the definition of the Social Entreprise is closest to that of peer production, but I would still insist that what we have there is a generalized “non-reciprocal exchange”. Yes, some types of values are exchange: participants in peer production get intellectual, emotional and spiritual value (and sometimes indirectly material value as well), but there is not direct expectation between specific individuals. The participant gets his value from the system as a whole: everybody is free to input, everybody is free to use the output, but there is no specific relation between the two.
Or in other words, from my email reply: The anthropologist Alan Page Fiske, in his relational model explained in the structures of social life, distinguishes equality matching, based on direct reciprocity, you give something, you get something on the same value in return; from ‘communal shareholding’ or what other anthropologists call generalized exchange, you give, but do not expect anything direct in return. That is what you are saying with your different kind of values. When I give in unpaid peer production and built Linux, I do not care that the users give me something direct in return, but I do get emotional and spiritual and intellectual value out of it. Why is the distinction important in my view? To distinguish it from the neoliberal assumption that we only give in direct exchange, so that, if we give something as free work, it must be that we get money or reputation out of it. In your terms, we get these other kind of values. But the others are not directly ‘giving’ this, or not intentionally, the mere fact of their usage, makes us happy, gives meaning to our work.
It would seem to me then, that a number of people are trying to find a middle way between the closed proprietary systems in markets (you can only join if you can pay), and the completely open system of peer production, in a semi-closed or semi-open format, as explained here:
With the Open Corporate model we have something which is both “Closed” in that only Members may use it, but also “Open” in that anyone who consents to the protocol may join. What I am saying is that the Open Corporate enables the encapsulation of a new “relational” property right which is currently lacking since there is at present a dichotomy between the “owner” and the “user”. I think the concern is very similar to what Nicholas Bentley is trying to achieve through his Intellectual Contributions scheme. These projects are aiming to make peer production viable by introducing elements of reciprocity and payment, creating an intermediary realm between the market and non-reciprocal peer production.
Chis Cook further replied by explicating his views on the relation between value and money: “Now the Money we have got – which you are right to be suspicious of – is an “Object” which is created by Credit Institutions aka Banks and Building Societies. This bears the same resemblance to true Money as anti-matter does to matter. It is not “Value” – or “Money’s Worth” as I often describe it – but a claim over Value created by Banks and backed (in very small part) by their Capital base using the “Fractional Reserve Banking” model which has evolved into perhaps the most cosmic mass delusion ever. In fact, as I argue in my “If Not Global Capitalism” piece, true Money may perhaps best be thought of as “Dynamic Value”, which exists only in the infinitesimally transient moment of exchange. Capital, on the other hand is Value at rest – or Static Value (and of course therefore also potential Money), in the same way that matter is static energy connected to dynamic energy by the relationship e= mc squared. The analogy with Physics is exact – in fact Economics may, I believe, be thought of as the Physics of Value. It’s just that at the moment we are stuck in a Newtonian (correction, we haven’t got beyond Ptolemy yet) linear world of absolutes, when what I observe emerging (Open Capital) is a non-linear phenomenon explicable only in Quantum terms. To get here we have to make the metaphysical assumption – which Robert Pirsig was the first to do in “Zen and the Art of Motorcycle Maintenance – that Quality/Value etc etc are INDEFINABLE or rather, definable only in relative terms. I agree with the monetary writer E C Riegel who defined Value as “the Relativity of Desire” and speculated that Money may exist only in motion.
“It would seem to me then, that a number of people are trying to find a middle way between the closed proprietary systems in markets (you can only join if you can pay), and the completely open system of peer production, in a semi-closed or semi-open format, as explained here:”
I confirm this. I am trying to find a midle way. When I read Chris Cook’s comment, “that there is no such thing as non-reciprocal exchange: there is always a “Valueâ€?, but that “some forms of “Valueâ€? in exchange are intangible and ineffable.â€? I thought to myself, this is exactly how I see it.