One Loaf Per Child

Bread and software are more the same than different.

We tend to think of software as a special product because it is appears to exist in a virtual world of zero rivalry. But that is incorrect. While any digital information can be quickly and almost effortlessly copied from one physical medium to another, the costs to store and express it are not even close to zero. One of the largest costs is the computer itself.

The genetics of wheat, the designs of the tools and the plan or instructions used to plant, harvest, grind, mix and bake are the virtual parts of bread. The physical parts are the actual seeds (the mass which contains that data called DNA), land (surface area of the earth), soil (both minerals and rotting organic matter), water, energy (including the SUN), petrol for plastics and metals (and recursively the virtual and physical parts of the machines used to extract these from the earth and form them), etc.

A computer also needs land (rackspace – which also implies a building), energy (electricity), plastic and metals; plus the virtual designs needed to assemble those raw materials into motherboards, CPU, RAM, Hard Drive, Optical Media read/writer, fans, screws, etc.

Moglen claims it would be evil to not give bread away if it were as cheap to produce, yet, if we step through the costs of production we find the physical resouces needed to host the production of bread are much smaller than those needed to host instances of software.

When he says nobody owns Free Software he is referring to the virtual part, but when it comes to the physical material required to host (store and express) that software, it is primarily the end-users that own. OLPC was started to address that very issue for those that don’t have a home machine.

So for computing the problem is hidden in plain sight – in that we overlook those costs maybe because we have the attitude “well, I would have bought the computer either way”. But that same reasoning could be applied to your yard. If you own land that is not covered by asphalt, concrete or continually poisoned with weed killer then it will probably be growing something, and that something very well could be the extremely easy to grow grass called Wheat. You could grow enough in 1 square foot to make a loaf, but most people don’t because it is too clumsy, but even if we limit ourselves to the small-scale production where physical Sources are only individually owned (such as Mao’s back-yard steel furnaces) the cost is still less than software. The simple hand tools required over the entire production of bread are very rudimentary and orders of magnitude less complex than the electronics required to store and express software.

But this is even easier to prove for large scale, corporate owned agriculture where the costs are so small that the US government actually PAYS farmers to NOT grow wheat. They (the supposed “we”) use federal tax dollars to keep wheat (and therefore bread) artificially expensive so that price does not reach cost. This also causes US to ‘dump’ this food in foreign countries for prices less than what the local producer can charge.

You may think “It’s not our fault, why don’t they just grow their own damn food?”. But the trouble there is our universal misconception of profit as goal instead of production. So, while a small farmer who owns the physical Sources of Production can grow some wheat for himself, once he begins trading with neighbors he must take a stance AGAINST them because ownership of those Sources do not ‘flow’ to the consumers of the objects of that production.

This is the same lack of control we see and are beginning to complain about with SaaS hosts such as MySpace, Feedburner, Google, etc. and all other industry like cell-phone ‘service’, gasoline producers, DRM laden electronics, etc. who offer deals that appear to be “good enough”, but can pull the rug out whenever they please and can charge prices far above cost, as they are the owners.

This is the core issue of what is wrong with the structure of our economy. Prices must be “protected” from reaching cost because businesses define their success by the profit they extract, not by production itself.

Confusingly, the word “producer” sometimes denotes the Owners, and sometimes denotes the Workers. For a small business where the owner is also a worker the line is even more blurry. Workers receive wages, and are not generally involved with profit, while owners usually invest for the long term goal of profit. This is a precarious situation that destroys small business that play that game, since efficiency in scale causes only the largest corporations to survive. This is why we see fewer and fewer farm owners and our food supply being controlled by a handful of powerful corporations that barely need answer to our supposed consumer ‘demands’.

But there is a special case where price can reach cost – where production and abundance is always good and profit is actually meaningless. This condition occurs when the Object Users (consumers) also happen to be the very Owners of the physical Sources (Means of Production).

When you OWN the land, water, seed, tractor, thresher, grinder, mixer, stove, pans, buildings needed to make bread you may hire someone to operate those things (and would pay that wage as a cost), but you can’t pay price above cost unless you were to pay it to yourself. It doesn’t make sense in that case; profit is undefined when the Object Consumer is the Source Owner.
Owning the Sources of Production is easy when the operation is small and you don’t need to share, but in many cases it is more efficient or even mandatory that the physical Sources be jointly owned because each person just can’t afford (and it would be terribly wastful) to Own the land, buildings, tools, etc. to make (for instance) laptops – we tend to leave that to a random group of owners that intend to keep price above cost.

The argument against addressing this issue usually revolves around the idea “Well, who in the world would invest if there will be no profit?”. The surprising answer is: *The Consumer* will invest, since production is already their only motive.

So now the question of how to make this occur without coercion – since any other way would be not only unfair, but, as Moglen states, would not have enough momentum to continue anyway.

A solution patterned after the GNU General Public License trade agreement would be some kind of contract that owners could CHOOSE to apply to physical property. That contract might say something to the effect of:

: If you share this object (say an apple), you must ensure the end user (the consumer) has access to the Sources of that object (the land, water, trees, tools). One way to accomplish this is through a revenue sharing scheme that causes any amount paid above costs (what would usually be called profit) to become an investment in the name of that User toward the purchase of more physical Sources required for future production of that same object.

7 Comments One Loaf Per Child

  1. AvatarHamish MacEwan

    While any digital information can be quickly and almost effortlessly copied from one physical medium to another, the costs to store and express it are not even close to zero. One of the largest costs is the computer itself.


    The incremental cost of data is near zero, it can be extraordinarily costly to produce.

    Similarly, the incremental cost of storage and expression is nearly zero, whatever the initial cost of the computer and storage is.

  2. AvatarPatrick Anderson

    Yes, but how does this differ from the incremental costs of owning the physical Sources required for bread production?

    The costs to maintain any physical Source (whether a tractor or a computer) are usually much smaller than the initial investment while the costs to operate those Sources might be quite high – as they include wages for the Worker (to drive the tractor or program the computer) and energy (diesel or electricity).

    It is the difficulty in organizing large collective investments that keeps Users (Consumers) from owning the physical Sources of Production that would allow us to then have “at cost” access and full control of the Objects of that production.

    If a group of Users (Consumers) were to incorporate and purchase some physical Sources that they voluntarily put under a contract that required all profit at each transaction be targeted as an investment for that very user in more physical Sources, then that collective ownership would grow according to the interest of the participants until it would soon outperform large holders – whether they be Google or ConAgra.

    I wonder how we could prove it is the Users (Consumers) who must OWN for optimum economic efficiency, and who will otherwise continue to beg and wonder why those that do OWN withhold access for the purposes of profit (usury).

    I’ve thought to make an MMORPG that modeled a simple but realistic society centered around bread production which would include private property and the requirement to eat (say one loaf) each day.

    Thanks for your comment. I hope my response can be taken with the sincerity I attempt to deliver it in.

    Your peer,
    Patrick Anderson

  3. AvatarMichel Bauwens

    Dear patrick,

    I have sent a number of emails, some of which have come back because of a full mailbox ,so I hope this gets to you. I find your work very important and fascinating for its insights. I have one major issue: if users become the owners, does that not create a dictatorship of another kind of market? Is it not better to find governance modes which honour both the autonomy of the real producers (the workers) and the users-consumers, rather than the latter alone. Your thoughts on that would be most appreciated.

  4. AvatarPatrick Anderson

    Protecting the worker is a very common concern that I have yet to find a convincing answer.

    The way I view this is to understand that everyone is the Consumer of something, even if just bread and water. The only reason we need to protect worker at all is not so they can work, but so that they can Consume.

    Because of this, Consumer ownership can be dangerous unless *every* human has their ability to Consume protected through Ownership in the Sources of that which they desire. After that, workers don’t need extra protection for the opportunity to work – for it is not working we need to protect, it is only Consumption that must be guaranteed.

    I once learned from a physics professor that pushing questions to ridiculous extremes helps to expose the validity of attempted solutions, so let’s try that here.

    Imagine a business that makes ‘pins’ (as described in “The Wealth of Nations”) that employs 1000 workers. Now imagine a discover is made by a worker there that automates production to such a degree that it eliminates the need for 90% of the workforce.

    1. If that business is owned by a few original investors (as is common today), then most of the employees would suddenly be out of a job but the Consumer Price would remain approximately the same (dropping just below the competition) if the discovery is kept secret or is patented to render it unusable by other Source owners. The difference would go into the owners pockets as profit.

    2. If that business is collectively owned by all of the workers in proportion to … there are different ways to divide the ownership, but maybe we could assume for now that every employee has an equal percentage no matter what job they do and no matter how long they have worked there. In that case, I’m not sure what would happen, but there would either be a lot of guys standing around pretending to work, or maybe there would be some kind of ‘rotation’ – where everyone stays employed, or maybe some of the workers would choose to receive a big bonus and then be able to retire (very different from being laid off). No matter the course taken, the outcome for the Consumer would look approximately the same as #1 – in that the Price would stay about the same.

    3. If the business is owned by the Consumers (Users) of those pins, then the workers would be laid off as in #1, but the Price would fall drastically because Price==Cost and Profit has no meaning when Consumers are the Owners.

    This still does not look convincing, but maybe it makes sense? I will keep trying to figure out another way of displaying this. Please post here if you have a better analogy.

    About the email trouble: my hosting provider had big hardware problems recently and is still recovering, so hopefully that is the only reason.

  5. AvatarMarcin


    Your thought on ‘users owning the means of production’ is ancient wisdom yet far ahead of its time. I foresee that advanced appropriate technology will make your proposition come true in the near future.

    What are you doing to organize the means of production to a smaller organizational scale of production owners? That’s the practical call coming from your theory. Is there a way that you can help to organize ‘production on a smaller scale’? That’s the essence of our work. Let’s consider seriously how that can be done, here and today.

    I know my answer. Fab labs. Open repository of digital design. Then virtually all manufacturing and agriculatural operations are in localized hands. Then, it remains only to master the provision of feedstocks and materials: minerals, rubber, metals, semiconductors, plastics, etc.

    The latter can be absolutely localized as well, but that may require further technological advancement. At the same time, there is nothing foreign about producing biofuels, bioplastics, compressed earth blocks, lumber, paper, fiber – all locally. It is a little farther stretch to talk of aluminum or pure silicon. Yet, these are both found abundantly in clay and sand. So even the advanced materials can be localized – that is not a far cry if we have ample energy in the form or solar concentrator electric power, for example.

    Talk to me on this.


  6. AvatarPatrick Anderson


    Are you saying that we cannot organize to co-own a large factory or farm?

    What are you doing to organize the means of production to a smaller organizational scale of production owners? … I know my answer. Fab labs. Open repository of digital design.

    I think the reason for the excessive interest in magical fabbers and “desktop manufacturing” is an attempt at avoiding the difficult issue of co-ownership.

    People want the advantage of owning the Physical Sources of production so they can have control, but want to avoid the sticky issue of partial ownership.

    Individual ownership of Personal Computers (PCs) is a big part of the success in the P2P paradigm and of Free Software and ‘online’ Free Culture. These Physical Sources are cheap enough that many people can afford one in their own home and ISP charges are just quietly disregarded.

    Collective ownership of Physical Sources is difficult, but obviously is “worth it” for many kinds of production – for that is the role that Capitalist corporations currently fill.

    For instance, a person could choose to individually own a milk cow so they could get “at cost” milk, but they couldn’t afford the better tools like a fancy milking machine, so would likely have to the work themselves since hiring someone to come for that little bit of time would hardly be worth it unless you overpaid them. And it probably wouldn’t be worth it to grow their own alfalfa, or to purchase expensive medical/vet tools, so would be paying “price above cost” to feed and provide medical care for the animal, and so on, recursively for the entire chain (actually tree) of production. There is great savings in eventually owning the physical sources for every step required for that production, and that is one of the savings in the “efficiency of scale”.

    Most people do not INDIVIDUALLY own a milk cow even though there are great advantages of controlling exactly what the cow is fed and whether or not it is injected with artificial hormones, and is treated humanely, etc. because it is just not realistic to INDIVIDUALLY own – it is too much trouble.

    But it WOULD be “worth it” for 10 or 100 or 1000 neighbors to COLLECTIVELY own a small dairy. Each consumer would have as much vote control as they have percentage of ownership, and when the majority wanted to do something that caused a division, the minority should be able to ‘fork’ from the rest of the group to avoid the excessive granularity of typical ‘democracy’.

    So the problem I am working on is in describing how to make collective ownership self perpetuating.

    The primary secret I have discovered that has been purposefully hidden or accidentally lost is that profit (price above cost) is a measure of a consumer’s dependence on the current owners of the physical sources, and is ‘balanced’ by treating that payment as an investment from the consumer that paid it.

  7. AvatarMarco Fioretti


    very good post, sorry to have discovered it only now. By reading it, I feel you may be interested in these
    Thoughts on P2P production and deployment of physical objects

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