He recently authored a chapter of the new book on Platform Co-ops Ours to Hack and Own, in which he states:

“Platform cooperatives – as a direct affront to the platform monopolies characterizing digital industrialism – offer a means of both reclaiming the value we create and forging the solidarity we need to work toward our collective good. Instead of extracting value and delivering it up to distant shareholders, we harvest, circulate, and recycle the value again and again. And those are precisely the habits we must retrieve as we move ahead from an extractive and growth-based economy to one as regenerative and sustainable as we’re going to need to survive the great challenges of our time.”

In the run up to the Open 2017 – Platform Co-ops conference in London, Oliver Sylvester-Bradley explores some of Douglas’ ideas:

OSB: You’ve mentioned that “the model of the ever expanding economy is bankrupt” and highlighted the “corporate charters” and “central currency” as the core components of the present “bankrupt” system. How can we hope to challenge the corporate charters?

DR: Well, you sound like you believe the way to change corporate structure is for citizens to take action against the corporations. That’s certainly one possible approach, and useful in a situation where there are no human beings within the corporation who are willing or able to change the corporations from the inside. What might be surprising to you is that most of the people in corporations actually do not want to kill people, do not want to be enslaving children in resource-rich nations, and do not want to make the planet uninhabitable. They are the ones in the best position to change corporate actions, since they are inside the companies themselves.

They simply need to be educated about what is possible. I tried to do some of that in my book. CEOs and Boards of Directors need to understand that they do have legal authority to act in the best long term interests of the company. So-called “activist” shareholders really cannot sue Boards for hurting the short-term value of shares – especially when the Boards are acting in the long-term interests of the shareholders. Not destroying the planet is in the best long-term interests of shareholders. Likewise, companies can restructure and reorient from within to favor dividends and public reinvestment over capital gains and extraction.

So, as I argue in my book, the key is to convince CEOs and others who are running corporations that they can exercise human agency in their decisions. They do not have to behave automatically. They can use their decision-making authority. They need to communicate with shareholders, and explain the advantages of getting lots of dividends instead of a one-time “pop” of share price, followed by an inevitable decline. Companies can actually make more money with ongoing revenues than blindly pursuing growth.

They can stop selling off their most productive assets, and instead remain powerfully competent companies. Steady state economics is about maximizing circulation rather than extraction. To anyone who understands how business works, they should see how this is a healthier choice for those within the business, as well as the distant shareholders who only want money at any cost.

OSB: You have described how “digital giants are running charter monopoly software…” and that their “technology enforces the monopoly”. At Open we are keen to see NGOs, co-ops, non-profits and even Local Authorities start to utilise open source software and, in return, to fund the development of a suite of open source apps which facilitate collective ownership and collaboration. What steps do you think are required to disrupt the digital giants’ monopolies?

DR: Of course, I was using the word “software” a bit metaphorically. The corporate charter is itself a program that can be changed. Instead, it is being further amplified by technology. What I mean by that is that the corporation works in a particular way, as dictated by the charters and contracts making up their business plan. So a company’s core code – long forgotten – may assume that the way to make money is to prevent people in the regions where the company operates from making any money. And while that may have been a good strategy for maintaining a slave state in the 1400’s, it doesn’t work so well in places where people are supposed to be free or employed.

But the company’s directors may have forgotten all of this by the 21st century, and simply implemented new plans based on the same strategy of exploitation and extraction. So now they are writing software and building platforms that embed these same assumptions about their users. And they end up extracting value and time from people without helping them create or retain any for themselves.

Or a business plan might be to make money by extracting metal ore from the ground. Then, the company builds technology to do that, which makes the extraction happen a lot faster. They don’t realize that extracting so quickly and totally may deplete things in new ways. And because they don’t realize that the core “code” of the company is actually changeable, they don’t see any way out of the problem.

Now, you’re talking about software solutions themselves, and how people from the outside can give up entirely on the corporate solutions, and build alternative software that works in greater consonance with the needs of real people and places. That’s pretty easy to do. We can write an alternative Uber that lets the drivers participate in the profits. Or an alternative Facebook that doesn’t manipulate people’s news feeds to try to program people’s future choices. The trick is getting people to use the alternatives when they’re not so pretty or universally accepted.

OSB: It has been suggested that the open-source / platform co-op alternatives to corporate software solutions will need to do two things at least:

1. Be easier to use / provide a better experience
2. Cost the user the same or less (i.e. provide better value for (conventional) money.

What do you think about the possibility of an “open app ecosystem” (a library of interoperable apps, covering all aspects of communication, organisation and even trading needs) sweeping into dominance over the corporate alternatives once it provides the same level of utility, at the same price, as the present corporate systems?

DR: The easiest tactic is to help people experience the impact of various pieces of software on their own existence. Does Facebook make them happier? How is it helping them take command of their lives? People sometimes have to become more aware of the surveillance state, the extractive quality of these tools, and the nauseous, empty, angry feeling they have after using this stuff in order to feel motivated to make a change.

OSB: Your chapter in Ours to Hack and Own entitled ‘Renaissance now’ explains how we are on the verge of a modern-day renaissance. There is no doubt that revitalising and retrieving lessons, techniques and habits from the past could help bring about change but the last renaissance was also driven by a shift in intellectual thinking. Do you have any thoughts on how, and where, an intellectual shift might come from?

DR: I think changes in experience can change people’s world view. If they have terrific experiences working in co-ops or using local currency or simply sharing stuff, then their world view will change.

OSB: You explained how “banks were invented to extract value from our transactions not to authenticate transactions”. Do you have any thought on why LETS and time banks haven’t made a more effective transition to the web?

DR: I think part of the reason LETS and alternative, trust-enabling systems have not developed is that most people are not actually proud of the value they create. Too many people feel that they don’t have enough to offer, and need to hide behind anonymous cryptocurrencies and traditional anonymizing monetary systems in order to mask things. Meanwhile, if a person is sitting in a cubicle working for a mortgage broker or collecting debt from student loans, how are they supposed to participate in a local LETS system? What real value are they creating for others? Such people find it easier to take some of the cash they’ve made and “invest” it in Ethereum than… become part of some local favour bank. To create and exchange value, you have to be able to create some value for other humans – not just help some corporation extract value from people.

OSB: I am excited about the idea that platform co-ops and the collective ownership of our local facilities and businesses could potentially completely disrupt capitalist democracy as we know it. Where do you stand on ‘working with and within the present system’ vs ‘building a new system which makes the present system obsolete’?

DR: Well, I don’t think it’s one or the other. People can vote on public and municipal activities through traditional democratic participation, and people can vote on private and business activities through their participation in cooperatives. I do believe that the more influence real people have on the private sector, the more freedom our public activities will be from corporate control. A platform cooperative is not going to lobby the government for destruction of the environment where its workers are living. So government ends up able to deal with reconciling the different views of its people, rather than that of its people with that of its non-human corporate actors.

Conversation with Rushkoff revealed there is a direct and inverse relationship between external investment from VCs and the real value a business has to society. The more external investment; the more the business is forced to follow money making objectives regardless of the impacts on the customers or users; the more value is extracted to pay back shareholders who may have no interest in the success of the idea or project, other than their personal ROI. By comparison, if an organisation or business is owned by its members its entire purpose can be very different. The objective of a member-owned co-op, or a platform co-op, is normally to benefit and support its members, meaning it’s focus shifts from irrelevant profit seeking to good wages for workers, equality and the long term sustainability of the organisation.

OSB: Do you think there is a direct correlation between the amount of external investment an organisation accepts (and hence ownership / governing authority it relinquishes) and the real value an organisation has for society?

DR: Well, it has more to do with how much a business actually needs to operate and satisfy its market. If a business is really inexpensive to operate, then it doesn’t make sense for that business to take billions of dollars in investment. I know that sounds crazy, but it’s true. If you take billions of dollars of investment, then the people who gave you that money expect to get that money back. This means you need to make billions of dollars in revenue. That’s really hard – especially if you’re a small business that can actually function with just a few thousand dollars. If you take less money, then you are not obligated to grow the business so fast. You are still *allowed* to grow your business fast, but you don’t have to become a multi-billion-dollar business right away.

The more money you take, and the less proportioned to the real size of your business, the more power you have to surrender to the people giving you the money.

OSB: We are often exposed to the vision of a world full of hate and extremism and scarcity but rarely hear about a positive alternative. If platform co-ops, the solidarity / generative economy take hold it strikes me we could be living in a very different world in the future. Can you describe what you think this world might look like?

DR: I’m not a utopian, so I don’t envision a world or economy entirely transformed into a new state where all the value people create is properly registered, the commons is reinstated and appropriately governed, and selfishness is exchanged for true compassion.

“The generative, solidarity-inspired economy I envision is one where humanity stands a good chance of making through the next century without going extinct.”

The generative, solidarity-inspired economy I envision is one where humanity stands a good chance of making through the next century without going extinct. I am trying to envision a world where global warfare won’t be the only way to prevent impoverished populations from enacting violent revolutions on their own governments. I’m imagining a world where the wealthy don’t simply try to earn even more money in order to insulate themselves from the problems they’ve created by “externalizing” the real costs of their business practices.

So the radical alternative I’m envisioning is simply a world where the most extractive and destructive practices don’t absolutely dominate us. Where people have the ability to work for one another if there are no corporate jobs available.

I can imagine a near future without people starving in the streets, without China cashing in its chips by purchasing America’s greatest companies and properties, and without a continuation of the shift of wealth from the poor to the rich. I can imagine it not getting significantly worse than it is now, but that will take a huge shift in power and attitude.

OSB: What do you see as the main stepping stones for this vision to become a reality?

DR: Well, from a policy standpoint, I think a shift in tax policy would do a lot: punish capital gains and reward dividends and revenue. Right now, we punish companies and people who earn money, and reward those who simply extract capital out of the economy. That has to be reversed.

People and companies have to look toward earning money with the thing they do, rather than by selling the company itself. You can earn money, or you can “flip” your business (sell it to short-term investors). The latter leads to really bad practices.

We also have to accept that growth is an artefact of a currency system, not necessarily a symptom of a healthy economy. There are some economies that may be full grown.

OSB: Thanks Douglas, you have given us plenty of food for thought. The proposal that the users might buy back Twitter seems to demonstrate the growing appetite for platforms which are owned and controlled by their members. Here’s hoping more people start to realise the benefits of member ownership and governance, and how this creates a virtuous cycle of value creation. As you say, it seems essential if we’re going to survive the great challenges of our time.

To stay up to date with the latest news about platform cooperatives and the new collaborative sustainable economy follow @open_coop and join the mailing list (form in the right hand column) and buy your tickets now.

Cross-posted from The Open Coop
Featured image credit: Frontline/ WGBH, second image credit Seth Kushner.

The post Re-writing the core code of business: A Q&A with Douglas Rushkoff appeared first on P2P Foundation.

4. Let’s All Be Independent Together

[Rudolf the Red-Nosed Reindeer, dir. Kizo Nagashima, Larry Roemer, 1974]

PN: How does idea of the individual fit into these other developments?

DR: Corporatism, with its promotion of competition between individuals over scarce resources and money, laid the ground for individualism and for a heightened concept of the self. I’m a media ecologist, I look at media and society as an ecology in which changes in one area reflect changes in another. The notion of the individual was invented, re-invented, in the Renaissance. This is part of why it was a re-naissance, a re-birth of old ideas, the rebirth of Greek ideals. The the Greek notion of the individual, which was always “the individual in relationship to the state,” the citizen, was recast as “the individual.”

The first individual in Renaissance literature was Dr. Faustus, who represented the extreme limits of greed. This was the new man, not a citizen of the city-state but an individual who has his own perspective on the world. We get perspective painting in the Renaissance, which meant the individual was a self-sufficient being whose point of view is important; we get reading in the Renaissance, which meant that a man can sit alone in his study and have his own relationship to the Bible, instead of gathering in the town square or the church, having the Bible read to him by a priest, as part of a congregation. So on the one hand it was this beautiful celebration of individual consciousness and perspective, but on the other it was all in the context of a new economy, one in which individuals were in competition against one another for scarce jobs, scarce resources, scarce land, and scarce money.

PN: OK, I’ll ask: but what about the artists?

DR: Historians say that one of the great things about the Renaissance were the patrons who could patronize a great artist. But before the Renaissance you didn’t need a “patron” in order to be an artist! You could actually live in a town and do some stuff and be a great artist. The Renaissance model of commerce and arts was not a pre-existing condition of the universe. Yes, the Vatican could commission some basilica to be painted, but . . . I’d be interested to see what Leonardo da Vinci or Michelangelo would have been like had they not been part of a centralized bureaucracy, but instead been independent little homespun artist guys. They might have been better artists . . . you never know.

PN: So now we have individuals and corporations as we know them.

DR: The king’s currency, centralized currency, is monopoly currency; demurrage currencies were declared illegal by the king. Why? First, centralized currency is easier to tax. Second, the king could remove gold from the currency whenever he wanted, he could basically suck the value out of it at will. And finally, because this is a currency based in scarcity, everyone has to compete for it. It’s a way to help people who have money be powerful just for having money — not because of what they can spend, but because of what they can hold.

PN: So money becomes a resource.

DR: It becomes a resource in itself. Actually it’s a resource once-removed, literally a derivative, the first derivative. Centralizing turns money from a representation of something real into a derivative asset class. We live in this derivatives-based economy today, it has trickled down to us in the form of central banking. Now most people believe that the way to fuel an economy is for a bank to inject money, and the way to start a business is by borrowing from the bank. The way that money comes into existence is it is literally lent into existence. But for every dollar that is lent into existence, for every dollar you earn, there’s a negative on the balance sheet somewhere.

PN: There’s debt right at the beginning?

DR: It is debt, the money we have is debt. Here’s how it works. You start a business by borrowing $100K from the bank. This means that you’re going to have to pay back say, $200K or $300K to the bank in 10 years when your loan is up. Where does the other $200K come from? It comes from someone else who’s borrowed $100K from the bank. And where are they going to get that? Either they go bankrupt, because they can’t pay it back, or they borrow another $200K from the bank. And then that has to be paid back, plus interest. So now they’ve borrowed $300K total and might have $900K to pay back.

The money supply has to grow as a function of interest. The rate at which we do business and make profit is actually driven and determined by the debt structure of the company rather than supply and demand. This is what Adam Smith was actually talking about. Adam Smith was not a free market libertarian, he was not a corporate industrialist the way the Economist or the Wall Street Journal likes to paint him. Smith said that economies only work in scale, they only work locally. He was living in a world where everyone was a farmer, and he hated corporations as much as he hated central government, because he knew that an interest-based economy does not ultimately work. And that is because debt is not actually a product. There’s nothing there.Nothing. Yet that’s what it was made for. The debt-based economy was invented so that people with money could get richer by having money, that’s what it’s for. I’m not saying it’s evil, it was an idea. But, it doesn’t actually work. If the number of people who want to make money by having money gets so big that there are more people existing that way than actually producing anything, eventually the economy will collapse.

PN: It sounds like a big Ponzi scheme.

DR: It is a Ponzi scheme! None of the companies we’re looking at as companies are what they are, they’re all just the names on debt. GM is a name on debt, Sony’s a name on debt.

PN: The New York Times . . .

DR: . . . is a name on debt. They’re all publically-listed, traded companies with these P/E ratios; there are the issued shares, and then there’s the actual business: those two things aren’t the same. The shares are actually more a drag on the system than they are an investment in the company. There’s all this debt to pay back.

5. Corporations R Us

PN: Debt has an emotional component as well, in the sense of, you’re going to owe me, and you’re going to owe me forever. So, better get to work, no slacking.

DR: Slowly over time, as corporations attempted to extract more and more value from people, both as workers and as consumers and ultimately as shareholders and investors in our own 401k plans, we all basically outsourced our lives. I outsource my job to a company. I outsource my consumption to a company, I go to Wal-Mart, I go to Costco. I outsource my investing and savings to companies, I give it to Citibank, instead of the local banker or my credit union or my restaurant or my children or my cathedral. All of our interactions have been mediated by corporations — you don’t work for me and I don’t work for you.

PN: Let’s talk about different kinds of value. Right now we have money, we measure everything by the little green metric. But there are other kinds, we all know that, there are personal relationships, there are other ways of measuring value . . .

DR: We have different ways of experiencing value, but it’s really hard to measure those. I feel that in the current environment, what people could or should be valuing makes them nervous, makes them anxious.

PN: What kind of ways?

DR: Sitting with a friend . . . OK, I’ll sit with a friend as long as I have my Paxil or something, because it’s almost like we’ve been acculturated to be desocialized. I can spend time with you because we’re working, right?

PN: Right, it’s productive.

DR: Productive — and we can measure it on the tape! Is it still turning?

PN: You’re saying money is not value-neutral.

DR: Not only is money not value-neutral, but our money is not money-neutral. Our currency is not the only money. There are other kinds of money, just like there are different kinds of media out there, and they all encourage different behaviors. Computers encourage certain kinds of behavior, television encourages certain kinds of behavior. A gold-based money encourages certain kinds of behavior, a centralized currency encourages certain kinds of behavior, and a demurrage local grain-based currency encourages certain other kinds of behavior. The kind of behavior that our money encourages, intentionally, by design, is: hoarding. This is currency that earns interest over time so you want to hoard it and not spend it. And that’s OK if you need that tool.

PN: But maybe that shouldn’t be the only thing in the toolbox?

DR: It’s like we only have a hammer and it’s really hard to put in screws. Centralized currency is really, really good for competition, it’s really, really good for big companies. Wal-Mart and Citibank can get money more cheaply; the bigger you are, the closer you are to the storehouse. And the big guys don’t want local currencies, they don’t want bottom-up value creation, work-based money, money that is worked into existence instead of borrowed into existence, because that reduces their monopoly over the means of exchange.

PN: The problem with defining ourselves by our jobs or socialism or by economic class is that we’re not just our economics, we’re not just our money.

DR: Right, I create value, but the value I create for my community is not just say, as a baker. It’s not just as a tailor. It’s also as the guy who brings those funny jokes to the party, the guy who has that beautiful daughter . . .

PN: And it’s not just ONE thing and it’s not measurable in just one way.

6. Home Sweet Home Depot

DR: From the 1920s to the 1970s an iconography was developed that turned corporations into our heroes. Instead of me buying stuff from people I know, I actually trust the Quaker Oat Man more than you. This is the result of public relations campaigns, and the development of public relations as a profession.

PN: Did the rise of PR just happen, or did they have to do that in order to prevent things from getting out of control?

DR: They had to do that in order to prevent things from getting out of control. The significant points in the development of public relations were all at crisis moments. For example, labor movements; it’s not just that labor was revolting but that people were seeing that labor was revolting. There was a need to re-fashion the stories so that people would think that labor activists were bad scary people, so that people would think they should move to the suburbs and insulate themselves from these throngs of laborers, from “the masses.” Or to return to the Quaker Oats example, people used to look at long-distance-shipped factory products with distrust. Here’s a plain brown box, it’s being shipped from far away, why am I supposed to buy this instead of something from a person I’ve known all my life? A mass media is necessary to make you distrust your neighbor and transfer your trust to an abstract entity, the corporation, and believe it will usher in a better tomorrow and all that.

It got the most crafty after WWII when all the soldiers were coming home. FDR was in cahoots with the PR people. Traumatized vets were coming back from WWII, and everyone knew these guys were freaked out and fucked up. We had enough psychology and psychiatry by then to know that these guys were badly off, they knew how to use weapons, and — this was bad! If the vets came back into the same labor movement that they left before WWII, it would have been all over. So the idea was that we should provide houses for these guys, make them feel good, and we get the creation of Levittown and other carefully planned developments designed with psychologists and social scientists. Let’s put these vets in a house, let’s celebrate the nuclear family.

PN: So home becomes a thing, rather than a series of relationships?

DR: The definition of home as people use the word now means “my house,” rather than what it had been previously, which was “where I’m from.’” My home’s New York, what’s your home?

PN: Right, my town.

DR: Where are you from? Not that “structure.” But they had to redefine home, and they used a lot of government money to do it. They created houses in neighborhoods specifically designed to isolate people from one another, and prevent men in particular from congregating and organizing — there are no social halls, no beer halls in these developments. They wanted men to be busy with their front lawns, with three fruit trees in every garden, with home fix-it-up projects; for the women, the kitchen will be in the back where they can see the kids playing in the back yard.

PN: So you don’t see the neighbors going by. No front porch.

DR: Everything’s got to be individual, this was all planned! Any man that has a mortgage to pay is not going to be a revolutionary. With that amount to pay back, he’s got a stake in the system. True, he’s on the short end of the stick of the interest economy, but in 30 years he could own his own home.

The post Douglas Rushkoff on debt, outsourcing and suburban isolation appeared first on P2P Foundation.

Penny Nelson interviewed Douglas Rushkoff for HiLobrow magazine at a particularly sweet spot in time: a month and a half after the beginning of the occupation of Wall Street. Much like OWS and its global precursors and offshoots in 2011, we feel that the issues raised are just as, if not more, relevant today. We’ll be presenting the full interview in three parts. Today we kick off with the intro, the origin of the chartered corporation, the gross mis-characterization of the late Middle Ages, and the God that lives inside money. In a couple of days, tune in for more.

How did we get to where we are now, with Wall Street occupied by a mini-tent city while financial instruments increasingly funnel funds towards the already-wealthy? How did we get to a state where corporations seem to have more legal (and financial) access to life, liberty and the pursuit of happiness than the average citizen? How did we get to a point where money is invisible and computerized, yet distributed ever more unevenly?

One thing is certain: we didn’t get here overnight. In his book, Life Inc., author and media ecologist Douglas Rushkoff traces the rise and rise of the corporation, from its beginnings in the late Middle Ages, through its adolescence in the Industrial Revolution, to its present global and virtualized maturity. Life Inc. remains as relevant as when it was first published in 2009, as the public debate over the economy becomes more widespread, and the need for an accurate long view intensifies.

In this #longreads interview, Rushkoff locates the roots of the corporation in the Renaissance, explains how the corporation has made us over into its own image, reveals why there’s a God on the money, and warns what we’re really buying into when we buy that mortgage. But it’s not all talk. In addition to looking back, Rushkoff looks forward to offer some practical — and provocative — ideas on how to unincorporate, and better occupy, our lives.

1. Vaal Is Hungry, We Must Feed Vaal

 Peggy Nelson: The corporation is not a recent phenomenon; it goes back hundreds of years. What is the origin story of the corporation? Where did it come from, and what is it, exactly?

Douglas Rushkoff: The corporation is the result of two innovations: the creation of centralized currency, and the creation of the chartered monopoly. In the late 1300s the upper classes — the aristocrats, the people who had been feudal lords — were becoming less wealthy relative to real people. As the merchant class and people in towns were producing and doing, the relative wealth of the aristocracy was going down, and this was a problem; the aristocrats wanted to continue the system that had been working for them for the last 500 years wherein they didn’t have to “do” anything to be rich. So they hit upon the idea of passively investing in other people’s industries.

Suppose I am the monarch. I want to make money through your shipping company; how do I get you to let me invest? Well, I use what power I have as a monarch to write up a charter, which means I give you a monopoly in a certain area, and you give me 30% of the shares in the company. The chosen merchant avoids competition and gains protection from bankruptcy, while the king receives loyalty, because the merchants’ monopolies are based on keeping him in power. He doesn’t mind if a few of the merchant class are as rich as he is, as long as he is able to get still richer as a result.

But this was not the promotion of free-market capitalism. It was the promotion of monopoly, non-market capitalism. It was locking into place a set of players and a set of systems that had nothing to do with the free market. And it changed the bias of these merchants away from innovation; in other words, from “how do I innovate and maintain my competitive edge” to “how do I extract wealth from the realm that I now control?”

PN: Then they’ll tend to be conservative because they’ll want to maintain what they have and not risk losing it.

DR: Conservative in that sense, but rapacious in another. Say I’m now in charge of the Colonies. What I want to do is extract their wealth; I want to prevent the people who live in the Colonies from creating any value for themselves. If the colonists are going to grow cotton, that’s fine, but they’re going to use my seeds, my agricultural tools, they’re going to use everything from me. If you are a farmer you’re allowed to grow the cotton but you have to sell it to me at my prices. You’re not allowed to make fabric out of that cotton! Fabricating is creating value. And then you’re going to — what? You’re going to make it into clothes? Those are clothes you could have bought from me! No, no, no, you must give all the cotton to me, I’ll put it on my ship and bring it back to England, then the king’s other chartered monopoly, the clothes manufacturer, will make it into clothes, and then I’ll ship them back and sell them to you — at a profit.

PN: So it’s all export crops?

DR: Right. And anything else I will shoot you for.

PN: And they did!

DR: And they did.

 2. Single-handedly Rehabilitating the Middle Ages

 DR: So for about three centuries, the middle and merchant classes were doing really well. Towns that had been in shambles since the fall of the Roman Empire and had lived under strict feudalism were finally coming into their own. This all hinged on the use of local currencies — grain receipts — through which people transacted. They were what we would now call “demurrage” currencies that were earned into existence. Towns ended up creating more value than they knew what to do with. They started investing in their infrastructure and their windmills and their water wheels; and also in their future in the form of cathedrals and other tourist attractions.

PN: They didn’t get money from Rome to fund their cathedrals?

DR: They did not. The Vatican and central Rome did not build the cathedrals. The funds came from local currency, which was very different than money as we use it now. It was based on grain, which lost value over time. The grain would slowly rot or get eaten by rats or cost money to store, so the money needed to be spent as quickly as possible before it became devalued. And when people spend and spend and spend a lot of money, you end up with an economy that grows very quickly.

Now unlike a capitalist economy where money is hoarded, with local currency, money is moving. The same dollar can end up being the salary for three people rather than just one. There was so much money circulating that they had to figure out what to do with it, how to reinvest it. Saving money was not an option, you couldn’t just stick it in the bank and have it grow because it would not grow there, it would shrink. So they paid the workers really well and they shortened the work week to four and in some cases three days per week. And they invested in the future by way of infrastructure — they started to build cathedrals. They couldn’t build them all at once, but they took the long view — with three generations of investment they could build an entire cathedral, and their great-grandchildren could live in a rich town! That’s how the great cathedrals were built, like Chartres. Some historians actually term the late Middle Ages “The Age of Cathedrals.”

They were the best-fed people in the history of Europe; women in England were taller than they are today, and men were taller than they have been at any point in time until the 1970s or 80s (with the recent growth spurt largely the result of hormones in the food supply). Life expectancy of course was still lower; they lacked modern medicine, but people were actually healthier and stronger and better back then, in ways that we don’t admit.

That was right before the corporation and the original chartered monopolies were created, before central currency was created and local currencies were outlawed. When everything gets moved into the center, things began to change.

PN: It seems like the Dark Ages were not perhaps so “dark.”

DR: Yes, I think that’s disinformation. I’m not usually a conspiracy theorist about these things, but I think the reason why we celebrate the Renaissance as a high point of western culture is really a marketing campaign. It was a way for Renaissance monarchs and nation-states, and the industrial age powers that followed, to recast the end of one of the most vibrant human civilizations we’ve had, as a dark, plague-ridden, horrible time.

Historically, the plague arrived after the invention of the chartered corporation, and after central currency was mandated. Central currency became law, and 40 years later you get the plague. People got that poor that quickly. They were no longer allowed to use the land. It shifted from an abundance model to a scarcity model; from an economy based on annual grain production to one based on gold released by the king.

That’s a totally different way of understanding money. Land was no longer a thing the peasants could grow stuff on, land became an investment, land became an asset class for the wealthy. Once it became an asset class they started Partitioning and Enclosure, which meant people weren’t allowed to grow stuff on it, so subsistence farming was no longer a viable lifestyle. If you can’t do subsistence farming you must find a job, so then you go into the city and volunteer to do unskilled labor in a proto-factory for some guy who wants the least-skilled, cheapest labor possible. You move your whole family to where the work is, into the squalor, where conditions are overcrowded and impoverished — the perfect breeding ground for plague and death.

 3. There Is A God, And He’s On All The Money

PN: The money that the king was releasing, what was that based on? The other currency was based on grain, it’s a direct relationship to how much grain there is, and as the grain degrades, the currency degrades . . .

DR: The king’s currency? It was actually not even gold: king’s currency was based in the king’s imprimatur. It was coin of the realm because his face was stamped on it.

PN: That’s fairly abstract.

DR: It is. And because people don’t believe in that abstraction, because they’re used to grain receipts being based in something real, precious metal was required for the king’s currency — silver, gold; they had to use something that was considered valuable so people would believe.

Fast-forward to the 1970s. After four or five centuries of people believing it, Nixon realized that people now do believe, so the currency can be taken off the central metal and just be based on belief. That’s when they started putting “In God We Trust” on paper money, when it was taken off the gold standard.

PN: That phrase hadn’t always been on there?

DR: No, it was on coins, but it wasn’t on bills. Because finally, belief is all that’s left.

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