Is Paul Mason’s PostCapitalism a version of ‘networked socialism’ ?

Excerpted from a review by Donald Gillies in real-world economics review, issue no. 73:

“The central thesis of the book is that because of new technologies (the internet and associated developments), capitalism is in decline and is likely to be replaced within a few decades by an entirely new socio-economic system – PostCapitalism. As Paul Mason himself says (p. xiii):

“…the technologies we’ve created are not compatible with capitalism … Once capitalism can no longer adapt to technological change, PostCapitalism becomes necessary… That, in short, is the argument of this book: that capitalism is a complex, adaptive system which has reached the limits of its capacity to adapt.”

Now this thesis is a very surprising one. Most people have an exactly opposite view, namely that capitalism is triumphant and irresistible. According to this more usual opinion, capitalism in the last few decades has overcome its traditional enemies. Communism has collapsed in Russia and Eastern Europe, and in China has been transformed into a kind of capitalism. Even in Western Europe, traditional social democracy has been undermined, and replaced by a more unbridled form of capitalism. It would seem then that capitalism is here to stay, and indeed is “the only game in town”. To think anything else seems to be mere wish fulfilment on the part of the old left. Indeed Paul Mason himself says that, for some people, (p. 250): “it is easier to imagine the end of the world than to imagine a non-market … economy.”

Still, strange and surprising views sometimes turn out to be correct, as Copernicus showed. Could it be that the successes of capitalism in the last few decades are a last flowering rather than a final triumph? In fact it is the opinion of the present reviewer that the central thesis of Paul Mason’s book is indeed correct. The main argument for his view can be made explicit by stating what I will call: The Principle underlying the Decline of Capitalism. Once this principle is formulated it will be seen to be plausible and indeed compelling. Before coming to this, however, it is worth saying something about the current crisis of capitalism.

Big capitalist organisations are bureaucratic and authoritarian. A hierarchy of managers, leading up to the CEO, plan what is to be done, and assign tasks to the workers. Interestingly, hitherto existing forms of socialism have also had this bureaucratic, authoritarian and hierarchical character. This is obviously true of communism, but also holds of the productive organisations of social democracy. For example, a nationalized industry, such as the former coal industry in Britain, was run by a bureaucratic hierarchy of managers. The appearance of these bureaucratic forms in both capitalism and socialism shows that they were indeed suited to production, given the then development of the productive forces and the type of good being produced. However, Paul Mason’s thought experiment shows that these bureaucratic forms are not suitable for the production of digital goods in the era of the internet. For the production of such goods, as the example of Wikipedia shows, we need a networked, collaborative group of workers who agree among themselves what is to be done and by whom, without the intervention of any managerial hierarchy or bureaucracy. The same message comes out clearly from other examples such as the free software movement.

Here then we have in embryo the PostCapitalist mode of production. However, there is one feature of the Wikipedia and free software examples, which must be removed if this type of production is to become general. Those who contribute to Wikipedia and free software projects are not paid, and so have to do this work in their spare time, while earning their livings in some other activity. It is remarkable that such numbers of skilled people are willing to do this, but the lack of pay sets a limit on the extent to which this mode of production can become general, since obviously most people have to earn their living in some way. The question then arises: if groups of workers are going to be paid to produce digital goods, who is going to pay them? Clearly no one in the private sector is going to pay them, because of the difficulty of producing digital goods under capitalism. It follows therefore that they must be paid by the state.

This leads me to a conclusion, with which Paul Mason might not perhaps agree, namely that the PostCapitalist mode of production will turn out to be a form of socialism, but one which differs from the earlier forms of bureaucratic socialism by being more egalitarian and libertarian. This type of socialism I think could be called networked socialism.

Paul Mason writes (p. xvii):

“info-capitalism has created a new agent of change in history: the educated and connected human being.”

Of course the overwhelming majority of educated and connected human beings are white-collar workers. So networked socialism is based on whitecollar workers in contrast to earlier forms of socialism, which were based on manual (bluecollar) workers.

Another feature of networked socialism is that it is international. In the networks, which produce Wikipedia, free software etc., there are members from all over the world. What is important is whether someone is good at doing the job. Where they happen to live is an irrelevance. Capitalism too has gone international with the rise of the multi-national (or transnational) corporations. All this shows that the economic foundations of nationalism are being eroded.

But can the state simply take over the production of digital goods, paying the researchers, journalists, film directors, actors, artists, musicians, etc. who are needed to produce these goods? Of course it can, and the simplest proof that this is possible is that the state already pays for the production of many digital goods. In fact almost all scientific research is carried out already by workers in universities and research institutes who are paid by the state. This system has simply to be extended to other areas. The fact that the products of these workers are given away free is no problem. They are being produced for the benefit of society. So it is right that they should be freely available to anyone in society. While attempts to preserve capitalist production of digital goods involve trying to strengthen copyright laws, the socialist production of these goods involves the total abolition of these laws. Musicians, writers etc. may no longer receive royalties, but they will instead be paid salaries by the state for what they produce, just as most researchers are at present.

Altogether then the difficulties associated with trying to produce digital goods under capitalism disappear once these goods are produced under socialism. Only one problem remains. The type of socialism needed is networked socialism. However, governments, if they tolerate socialism at all, much prefer bureaucratic socialism. This is for obvious reasons. Bureaucratic socialism gives governments much more control. They appoint the top managers of the bureaucratic hierarchy and through them can have a say in what goes on in the organisation. With networked socialism things are different. The government has to pay a group of workers, assign them a task, and then leave them to get on with it without interference. Such a handsoff, libertarian approach is not very appealing to governments, as is clearly shown by the case of scientific (and other) research, which is already financed by the state. Governments have tried to re-organise research on a more managerial model using such devices as research assessment systems. The results have been very unsatisfactory. The costs of research have been increased while the results have got worse with the stifling of new ideas and other undesirable consequences.

The promised principle underlying the decline of capitalism can now be formulated. It runs as follows. It is very difficult, if not almost impossible, to produce digital goods under capitalism, but very easy to do so under socialism.

whether the production of digital goods will become the dominant sector of the economy.

Let us look at this from a historical point of view.

With the invention of settled agriculture, humans were able to develop cities and civilisation. The economies of these states were, for thousands of years, based on agriculture. Food production was the dominant branch of the economy and usually as much as 90% of the population worked in this sector. Since food is so necessary for humans, it is doubtful whether anyone living in these agrarian states could have imagined that things might one day be different. Yet with the rise of capitalism and the industrial revolution, things did change, and it was not long before industrial manufacturing rose to become the dominant branch of the economy. The reason for this was that the industrial sector provided inputs for agriculture, such as machinery, fertilizers, etc. which increased agricultural output, while diminishing the number of people needed to produce that output. Once a nation started industrialising, it was not long before the industrial workforce greatly exceeded the agricultural workforce. It is also worth noting that capitalist relations, which had first established themselves in the manufacturing sector, quickly spread to the agricultural sector, so that capitalist farming replaced the various forms of pre-capitalist agriculture.

If now we look at the rise of the digital economy in relation to traditional capitalist industry, the parallel with the rise of capitalist industry in relation to traditional agriculture becomes immediately apparent. The digital economy produces inputs to industry such as new scientific and technological knowledge, software in general, and artificial intelligence programs in particular, and so on. These inputs increase industrial output, while diminishing the number of people needed to produce that output. Probably already in the advanced economies the percentage of workers in the digital economy exceeds the percentage in traditional industrial manufacturing. Moreover the digital sector plays the dominant and controlling role in relation to industrial manufacture. If therefore networked socialism becomes the standard mode of production in the digital sector, it will probably spread to the industrial sector as well, just as capitalist farming replaced earlier pre-capitalist modes of agricultural production.”

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