Market economy and peer economy: talking about sustainability

I start publishing parts of the paper “Laser Theory and Peer to Peer”. Although that it carries considerable flaws, I hope that you will also find some interesting seeds of thought in it.

Biello [2007] admonishes of the danger that the planet Earth cannot support the demands humanity is placing on it, as the environmental impact of humanity has reached an unprecedented scope. In the article “Summary: What P2P Means for the World of Tomorrow” [2007] Bauwens delineates the current counterproductive logic of social organisation that “is based on a false concept of abundance in the limited material world; it has created a system based on infinite growth, within the confines of finite resources” so “we need to base our physical economy on recognition of the finitude of natural resources” towards a sustainable steady economy. The rival, non-excludable goods such as natural resources give way to the ‘tragedy of the commons’ as described by Hardin [1968], leading to the competitive depletion, instead of the cooperative conservation and sharing. There is a field of research named ecological economics that aims at finding ways to operate an economy within the ecological constraints of the biosphere [Barnes, 2006, 2008; Kapp, 1944; Martinez-Alier, 1987; Polanyi, 1950]. Barnes [2006] writes that maximising the profit (what exactly Friedman [1970] considers as the social responsibility of a business) is not the same with creating profit, as the former idea does not include the concept of sustainability. The neoclassical economic thought [Friedman, 1962, 1970; Petsoulas, 2001], which promotes the doctrine of the ‘free market’, is interested mainly in the problem of the efficient allocation of resources, and less about the two other fundamental economic problems, which are central to ecological economics: distribution (equity) and the scale of the economy related to the ecosystems on which it is based [Daly and Farley, 2004]. Barnes [2008] says that there is a need to act quickly and fix the market flaw that causes climate change, by creating a workable and lasting system for limiting the pollution. It is obvious that the number one priority is the material economy to be premised on the finitude of natural resources as well as aim at limiting the ongoing pollution. The condition of securing the environmental sustainability is mandatory if we wish to be able to experiment with new modes of production or even talk about the possibilities of a new mode of social organisation.

Till now, peer economy has not been applied to the material world of production. However, at least in theory, counter to the neoclassical economic thought (as it was mentioned above), peer economy is primarily focused on concepts such the Commons [Bauwens, 2005; Barnes, 2006; Benkler, 2006; Siefkes, 2007], recognising the finitude of natural resources. Peer economy is not premised on antagonism and competition for acquiring scarce resources, but rather on sharing and cooperation [Bauwens, 2005; Benkler, 2004, 2006; Siefkes 2007] creating an alternative political economy (what Orsi [2005] calls the “political economy of solidarity”) that is radically different from the political economy of the ‘free market’. Therefore it can be formulated that peer economy may be friendly to the environment, as it theoretically [Bauwens, 2005; Barnes, 2006; Siefkes 2007] focuses on all the three fundamental economic problems of allocation, distribution (equity) and the scale of the economy related to the ecosystems on which it is based. Another argument, to show that peer economy could be more sustainable than market economy, can be based on the fact that peer production actually is not a process that distributes goods. Market economy uses the market as a means to indirectly allocate produced goods – although it is not clear whether these goods are really needed or even whether they can be sold. Consequently, this indirection results in excessive consumption and production patterns: “every single person in the industrialized world directly or indirectly produces 15,000 kilos, or approximately 200 times their own weight, in waste products every year” [Benammar, 1999]. In contrast to the market economy, peer economy distributes the effort to produce the goods, as a result of the openness on which it is premised. So there is a direct relationship amongst needs and products, and in this way it is more possible to achieve sustainability [Merten, 2007]. Also, in the production of energy the peer economy encompasses efforts for alternative, ecological, P2P energy production (see Distributed generation and Microgrids as examples), instead of the non-sustainable petrol-based market economy’s methods. Still, as in the material world of production peer processes are in an infant level, it is difficult to be absolutely sure that peer economy would be in reality more sustainable than market economy. During the conceptualisation of the paradigm shift “cradle to cradle” by McDonough and Braugnart [2002], they articulate some mandatory conditions for every production process. They claimed that each production activity should ‘feed’ another production activity: every waste should be ‘food’ for another productive activity [McDonough and Braugnart, 2002]. Such production does not create scarcity, but it contributes to cycles of abundance [McDonough and Braugnart, 2002]. Thus, this implies that every production should not be seen as an autonomous activity, rather a part of a chain. So, through experimentation and practical evaluation we could understand which productive chain is more sustainable. At the moment, peer economy is only about single products and not about chains of productive activities.

Except for the objective side of sustainability, which was discussed in the former paragraphs, it is necessary to realise its subjective side. Understanding that an economy of infinite growth is not sustainable and that it leads to an environmental collapse [Barnes, 2006, 2008; Biello, 2007; Taylor and Taylor, 2007] is the first step to be made. The second one – which I call subjective sustainability – contains the realisation that human happiness and social status are not dependent on infinite material accumulation and overconsumption [Benammar, 1999]. This is exactly what Zizek [2001] means when saying that capitalism continues to disavow its gap with ‘reality’, presenting itself as serving the ‘real needs’ of ‘real people’. The problem of the subjective sustainability is evident in various researches that were conducted last years in developed capitalistic countries such as Britain or USA [Barnes, 2006; Monbiot, 2001] and prove that despite the fact that people are much richer (from a materialistic perspective), they are less happy than they used to be some decades ago. Benammar [1999] submits that advertising, which ceaselessly encourages consumption, “is a response to a lack, a scarcity within us, a deep-felt psychological need for reassurance through consumption”. He eloquently writes that [1999]: “We are not cool unless we have a new sporty automobile; our fragile egos are strengthened by the latest perfumes and brand-name fashion, and new computer gadgets keep us occupied. There is a constant appeal to needs within us, to the hungry ghosts whose hunger can never be appeased.” The peer processes, based on a new ethos of sharing, autonomy, communication and creation, offer more happiness [Benkler, 2006]. The peer ethos differentiates itself from the monetary ethos of market economy and creates new forms of social life [Bauwens, 2005]. In the immaterial world of economy the overproduction and the overconsumption of knowledge and cultural goods contribute to the human happiness, as they enrich human mentality (being rich from an immaterialistic view) and distribute more efficiently the cultural capital, as described by Bourdieu [1977, 1984, 1985]. From a Marxist perspective [Holloway, 2006; Marx, 1889] this new mode of production (peer production) does not alienate people from each other, as they own the means of production and share their products. So the materialistic fetishism is being substituted by ‘immaterialistic fetishism’ creating new modes of relation: what Orsi [2005] defines as the political economy of solidarity. Still, it is not clear whether in the material world of economy peer processes would offer the subjective sustainability. It can be supposed that as peer economy, premised on sharing, communication, cooperation and social creation (enhancing social relations), allows for the maximum dissemination of culture and knowledge, it offers the means to the people to come together realising that happiness is not dependent on infinite material accumulation and overconsumption.

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