Kate Raworth recognises that a dramatic new mindset is needed if we’re going to address the economic challenges of the 21st century. Her iconic book, Doughnut Economics: seven ways to think like a 21st-century economist, argues that our economic activity should operate in a space that’s above a social foundation, and below an ecological ceiling. What this means in practice is that essential human rights and quality of life are delivered to everyone, but within the means and resources we have available on the planet. The doughnut of Kate’s analogy is a playful metaphor for a serious and urgent challenge being faced by the world’s population. Triodos Bank caught up with Kate to ask more about her perspective on modern economics, and how we can create a system that works within the limits of her theory.

Sharing instead of redistributing

Your economic model is now six years old. Have we made any progress?

We have. I consider the Sustainable Development Goals (SDG’s) to be an essential step. They are much more ambitious than their predecessors, the Millennium Goals. They compromise the systems that sustain life on earth and are designed for all countries, not just the South. The SDG’s are a positive development, but I think we should be able to break through the ceiling of our imagination. The question is: can we design a system to improve things? That, in my opinion, should be our ambition: to develop activities that are distributive and generative from the start.

What exactly do you mean by ‘distributive by design’?

We usually talk about redistributing the wealth that is initially in the hands of a small group of people. That is the core of the 20th century model: redistribution of income afterwards, through e.g. progressive taxes and other means. This means that certain groups can keep questioning this redistribution over and over again. The distributive concept of the 21st century is about choosing to design our activities in such a way that they share the value from the start, instead of redistributing it afterwards.

Distributive by design starts with the question: who owns the wealth? The 21st century is not about redistribution but about sharing the sources of wealth from the start. And it is not just about the money, but also about land, companies, the ability to create money. What about the ownership of technology, who will own our robots? How do we treat our knowledge? Does it not make sense that innovative ideas originating from publicly funded research should be accessible to everyone?

The core of the challenge, then, is in reinventing the way we create value in our economy and share it from the start. You can do this with alternative forms of ownership of companies, like employee-owned companies or co-operations. Or you could anchor it as a target in the company’s Articles. Another way of integrating the sharing of value in the design is not to freeze them in patents but instead let them circulate freely among the commons. That way they travel through society, research communities can use them and develop them further. Another way still is to work with local currencies that connect and empower new initiatives.

Money with patience

The economy should not just share value. It should also be generative?

Yes. We seem to find it normal that a company focuses on realizing but one kind of value – financial profit – and in addition, keeps it for itself and its shareholder. It is very much the mentality of the 20th century: how much money is in it for me? You could describe it as an extractive economy, as over-exploitation taking away valuable resources from the community.

The 21st century, generative model has a different baseline. The question now is: how many kinds of value can I integrate in my company’s design to make sure that I can give value back to society and the environment? I keep meeting entrepreneurs, designers, urban developers, etc. who adhere to this new mentality with such vigor! As social entrepreneurs they want to create value that flows back to the community, forms of value that are easier to share. As a company, why would you strive to only reducing your negative impact on the environment when you can just as easily generate a positive impact? So instead of reducing emission of greenhouse gases, you start generating renewable energy and you share it with your surroundings. The same goes for the social domain, whereby companies actively contribute to the wellbeing of their neighbourhood or community.

What role do you see for the financial world?

That is the million-dollar question. First, we should investigate how to collect money in a 21st century way. That leads us to ethical banks, money with patience, and at first even philanthropy, to get things going. All of those are important sources for money because their values are in line with those of the companies they are supporting. Within the existing 20th century money industry we could do this through our pension funds. Could we restructure them so that they become value-driven? Can we enable people to change to such ethical pension funds? Besides that, we obviously need clear legislation. But I focus mostly on finding new forms of financing that are suited for 21st century businesses.

And that is where Triodos Bank comes in. The bank pays attention to these new kinds of entrepreneurship that are essential for the future. Triodos consciously uses money to create positive social, ecological and cultural change. It is an excellent example of a company with a lively target, aimed at distributive and generative companies whose values go way beyond the financial profit that stays within the company.

Between the markets and the commons

How would you rate the potential of our digital networks?

We underestimate their power. They enable citizens to get organized on different levels and at minimal costs. Take Wikipedia, the citizens’ encyclopedia. Or Linux, an open source operating system used by organizations all over the globe. These are tools which allow citizens to build their own networks.

At the moment, a few companies hold monopolies, like Facebook and Amazon, but it does not necessarily have to stay that way. People can be active in different networks. We can be on Facebook, but at the same time join local networks and exchange information and knowledge about our city. I foresee a big increase in open-source networks for specific cities and communities. We underestimate what these networks could mean for citizens who want to collaborate and connect.

The new possibilities to work digitally and open source are leading to a whole new generation of innovative entrepreneurs who have begun to operate on the border between the markets and the commons. Your company may be small, but if you share your ideas with the commons, you will have access to a global research team. New business models will see the light. And they are successful precisely because they are open source. We are looking at an immense quest for alternatives, which might explain why my book was so well received. More and more people are looking for an alternative concept of what our economy should look like and which purpose it should serve.

Kate Raworth is a renegade economist focused on exploring the economic mindset needed to address the 21st century’s social and ecological challenges, and is the creator of the Doughnut of social and planetary boundaries. She is a Senior Visiting Research Associate at Oxford University’s Environmental Change Institute, where she teaches on the Masters in Environmental Change and Management. She is also a Senior Associate at the Cambridge Institute for Sustainability Leadership.

Original source: Triodos Bank

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‘Pollinating Prosperity’, presentation by local economic development expert Michael Shuman in Adelaide, South Australia, March 2016:

Shuman delivered this talk at an event held by Economic Development Australia SA, sponsored by Green Industries SA and the Department of State Development.

A pollinator is a self-financing economic development program or company, an approach Shuman advocates over ‘attract and retain’, which diverts attention away from local economic development and is both an inefficient and ineffective use of public funding http://blogs.worldwatch.org/transformingcultures/wp-content/uploads/2011/02/Relocalizing-Business-Shuman.pdf.

The workshop began with a 20-minute presentation on pollinating prosperity, which included Shuman’s four principles for building prosperity locally:

• Maximise local ownership, the percentage of jobs in the economy in locally owned business
• Maximise local self-reliance and import replacement, not to detach from the global economy, but to  engage with it from a position of strength rather than race to the bottom
• Spread models of triple-bottom-line success – local business with high labour and environmental standards
• Create an entrepreneurial ecosystem with the 6 Ps – planning (analyse and plug the economic leaks), people (support entrepreneurs who are leading), partners (make networks of local business more competitive as a group), purse (tap local savings/superannuation and put it to work in local businesses), purchasing (spearhead buy local campaigns by consumers, business, public agencies), policy (remove anti-local bias)

Michael Shuman Bio

Author, entrepreneur, and speaker Michael Shuman is a Stanford educated economist and attorney, and a leading global expert on local economics.

He is one of the architects of the crowdfunding reforms that became the ‘JOBS Act’, signed into law by President Obama in April 2012, and dozens of state laws overhauling securities regulation of crowdfunding.

Shuman is currently Director of Community Portals for Mission Markets and a Fellow at Cutting Edge Capital and Post-Carbon Institute. He’s also a founding board member of the Business Alliance for Local Living Economies (BALLE), and an adjunct instructor in community economic development for Simon Fraser University in Vancouver.

Shuman has authored or coauthored eight books, including Local Dollars, Local Sense:  How to Move Your Money from Wall Street to Main Street and Achieve Real Prosperity, and The Small Mart Revolution: How Local Businesses Are Beating the Global Competition. His most recent book is The Local Economy Solution, which is is focused on local economic development and how innovative, self-financing ‘pollinator’ enterprises can grow jobs and prosperity.

In recent years Shuman has prepared studies the on the opportunities for food localisation for New Mexico, Detroit, Cleveland, Boulder County, Denver, Michigan, Washtenaw County (MI), and Pioneer Valley (MA). He led another food study, funded by the Bill & Melinda Gates Foundation and the Kellogg Foundation, analysing case studies of 24 local food businesses worldwide. (www.communityfoodenterprise.org).

He has performed “leakage analyses” and related economic-development planning for Spokane (WA), St. Lawrence County (NY), the Katahdin Region (ME), Martha’s Vineyard (MA), Appalachia, Davidson County (NC), Kootenai County (ID), Cabarrus County (NC), Wabash County (IL), Biltmore Estates (NC), Central Park (NC), and the Port of Baltimore (MD).

Photo by Edith Maracle

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We trust in the ways things used to be, so we keep on trampling over blooming flowers while chasing dying leaves to get us there. Innovations to provide for everyone, arrives exponentially everyday, yet they are less and less accessible to a frustrated population of embarrassed future millionaires betting their lunch money on the next lottery ticket out! Maybe that’s why we seem to revert back to 19th century political promises, protecting their 12th century economic premises.

The truth, however, is more difficult to ignore.

Sure, we can choose to ignore the technical truths of distributed and regenerative abundant energy generation systems, DAOs or decentralized autonomous organizations, co-operative sharing networks, and disruptive breakthroughs in every aspect of our lives. Although, as long as we are in denial, the outcomes that we want, our real intentions like feeling loved, feeling secure and feeling satisfied, will hardly come from the old economic instruments we’ve agreed to get us there. Fiat money, for example is only as good as its ability deliver on its promise to convert our intentions into reality, and if our political and economic systems cannot make good on those promises, maybe we are asking the wrong questions.

When broken promises are the norm, and not the exception, we might want to ask new questions to reframe the next planetary prosperous reality we could be living in now!

First, observing the obvious:

Earth Day: People with homes make up signs to complain about how our elected leaders are destroying the world, while homeless people are told to move out of the way for the parade. Then there is lots of plastic trash we have to clean up.

Conscious Festivals: Everybody buys expensive tickets to gather in harsh environments to feel one with nature and the cosmos. We all talk about our enlightenment, then go back to work afterwards as some form of slave labor. The organizers walk away with millions.

Innovation Hubs and Investors: Super creative, hard working people bust their asses designing solutions to make our lives easier. They are persuaded to work in a noisy and crowded “co-working” environment, getting ready for their 5 minutes in front of “successful” people who might offer them some bio-survival tickets. That is only if those people think that someone’s life’s work, supported by all of our taxes which paid for their education and support, can make their collection of IOUs grow larger without doing any real work.

Sharing Economy: Some smart people designed some clever software to make the supply and demand networks of services super efficient. A salesperson sees that as a way to get goods and services for way cheaper, and takes out a huge loan to aggregate those services and promote it. Everyone who works for the network complains about doing more and getting less, or paying more and getting less, and the salesperson still owes money to the lenders, so they have to sell us the story of why they are still going to change the world.

Retail and Real Estate: Buying and collecting stuff has been fundamental to our existence. Except now, we made so much nice stuff, that no one cares where you got it from and how much you paid for it. Where we live depends on where we have to work, and when that’s everywhere, its a hard sell to keep pumping prices that no one could ever pay back in their lifetimes. So now we have retail and residential ghost towns, waiting for people to buy into the dream of being tethered down so investors don’t lose their shirt. On the commercial side, the high yield captive renter businesses like hospitals still keep building, although we are wising up to their game, and looking for health and wellness elsewhere. Business can’t work without customers to pay for their services, and now business as usual is losing customers while waiting for a time machine to take them back to the 80s when no one knew better.

Banking, Insurance and the Stock Market: We trust people who think like us, and we work with those we trust. When we feel people can’t be trusted, we trust our common agreements. Mind you, the agreements are only the instruments and not the intentions behind them. They are the best we could do with what we could understand. So now we seem to understand a system of promises expressed in arbitrary numbers that might deliver on those promises if we can still trust the people that manage them to deliver.

Unfortunately, “those people” don’t seem to care much about anyone other than themselves, and keep breaking their promises. It’s not their fault of course, the stuff they thought they could sell us about how the future will be, we already know now, because the people who make and buy the stuff we are selling are known in the present. Oh well, there goes that idea!

Please understand that this is not some open source idealist rant.
It is a simple realization of the technical reality that we all feel, and all I’m doing is just putting some words to it. Most of us are not beyond self-interest and self-preservation. We do not act according to our ideologies, we act according to our survival instincts. We do what we do, to make sure we will have our insecurities made secure, our distrust of uncertainty made certain and trusted, and be seen and appreciated for who are, relative to what we feel our value should be in the world. At the core, we just want to love and be loved in return.

In other words, we want Returns on Our Intentions.

That is, and has always been the real ROI (Return On Intention). It’s just that the instruments we’ve agreed to get us there no longer make sense in a world where markets die and networks rule. We now have the digital tools to make agreements between each other accountable, trust each other relative to context and deliver on those promises without a proxy. Plus, we can now be rewarded for adding value to the network, rather than the network sucking the value from us to pay off some imaginary ideal for undeliverable IOUs.

This is the age of instant ability to manifest our intentions. We really don’t have to work so hard to get there. It’s right in front of we when we pause and see what is, versus what we want to believe it is. We are living in the 21st century. Let’s get out of our 12th century economic mindset.

So how do we do that?

1. Networks are natural:Nature needs fewer inputs per outputs and reuses waste as feedstock, as do networks. As we feed networks with data that satisfies its needs for matching input, output and waste, we enable it to feed us in new ways. It’s like farming, only better. For every unit of energy used to work the farm, the farm rewards us with more units of energy as food. Networks do exactly that, yet, we now use network efficiencies to make stuff cheaper and sell it for higher margins, not realizing that we are bankrupting its original purpose. We’re foraging like hunters now, when we’ve already invented farming. We don’t have to. Some networksalready get this, and are starting use the sharing economy for good, as in, recirculating the value created back to its participants.

2. Feedback is fundamental: Understanding our local actions relative to global impact directly relates to the quality of our lives. When you look up the history of automotive safety before and after the invention of traffic signs, traffic rules and dashboards, the stats are astounding! 1917, Detroit had 65,000 cars on the road, resulting in 7,171 accidents, 168 of them fatal. That’s approximately 10% per year. Compare that to today, with autonomous cars on the way, and the percentage of accidents relative to the 1.2 billion cars on the road is less than 0.004%. The parallels to automotive safety stats are all around us. The more we understand the impact of our action relative to others, our behavior shifts, and we use less energy to do more work.

3. Values are Contextual: What is the value of a toilet when nature calls? Priceless. The value of anything is the amount of life we are willing to exchange for it, so where we spend it, is of prime importance. We know that intuitively, although our tendency is to trust the value metrics of our predecessors that did not, and could not understand the world we see now. Today, networks are showing us a new framework and new contexts for where value is created and relative to our goals. Just as water has a different value in the desert than in the tropics, our contributions have contextual value that cannot be captured within the existing economic paradigm we’ve chosen to satisfy our intentions. Money can’t buy me love is more than a hit song, it can’t even buy me the satisfaction of status once reserved for people who could buy $90,000 watches and $800 shirts, because no one really cares anymore.

Optimizing the Observed : When we see our world relative to Return On Intention, the things that once looked like problems we had to live with suddenly become irrelevant cultural relics.

Consider our previous list after this realization:

Earth Day: Protests to shame politicians and policymakers are less about the planet, and more about the economic paradigm that pillages the earth for profit. When input, output and waste are matched based on network efficiencies, real value is rewarded for the benefit it can guarantee in the present, not a future value best guess that robs us of our survival.

Conscious Festivals: Each of us want to be relevant in the world. Our intention is to be acknowledged, deemed significant, and feel wanted and needed. When our economic paradigm cannot deliver on that promise, we go looking wherever we can find it. Gathering and ritual is integral to society. A network economic model that rewards both patrons and producers relative to contribution changes what celebration is all about.

Innovation Hubs and Investors: The Intention of investors, whether its slow money R&D, or fast money venture markets, is ultimately to motivate the creation of innovation that we can all benefit from. The intention of innovators is delivering on that promise and be appreciated for doing so. The disconnect today is about reconciling two separate agendas, when beneath the instruments, the intention is the same. When we chose to operate in a paradigm that supports intentions over instruments, we quickly realize that investors, innovators, and the rest of us benefiting from their creation are all part of the same ecosystem. That allows for lenders and borrowers to both benefit from network equity, to be transparent, and to include their customers in sharing that surplus, instead of extracting future value from them.

Sharing Economy: Share the wealth. It’s really that simple.

Retail and Real Estate: What is the intention behind a purchase? How does our technical reality satisfy that intention? As we understand and measure consumption in satisfying intention terms, how we buy what we buy shifts. The same is true for the best use of land, including the deciding not to misuse it, because it makes much more sense in resource regeneration terms. Focusing on our intention of creating a higher quality of life now, rather than the fuzzy promise of it, shifts how we solve for the solutions that will actually guarantee future access, rather than just sell us the dream of it.

Banking, Insurance and the Stock Market: Trust is about context relative to intention. The instruments we had trusted to deliver on the intention of producing material baseline for survival, have already performed their task in the 20th century. Our future values are not determined by further capacity for production and consumption, rather, it is to answer the intention of how much more satisfaction we can expect. Markets were apropos for that purpose, then. Now, we have peer to peer networks that can directly guarantee that with pre-sales, sourcing, off-takes, and allocations in advance of production. In effect, we now have the ability to become our own stock tickers, relative to the social value our networks believe we can produce. So maybe it’s time to realize that market economic paradigm has already shifted to real-time network value creation.

RUN : Regenerative Unified Networks delivering ROI,

Return On Intention

No one can predict the future, though the signs for a future full of prosperous possibilities are all around us, when we are willing to reframe reality for the rest of us. Search and social networks signaled the start to the sharing economy, crowdsourcing, crowdfunding, and the evolution of blockchains, holochains, smart contracts, DAOs, OVNs, AR, VR, AI and whole host of emergent acronym ready ideas are showing us something previously unseen.

We are no longer in a market driven reality.

Our exchanges now are on ubiquitous, asynchronous, autonomous networks, a whole system of networked interdependencies. Sure, most of them now look like walled garden platforms like Facebook, Google, Amazon, Uber, AirBnB, etc. though their longevity will be determined by whether or not they share data and transform their models to serve their ecosystems instead of extracting from them. This recent article on Google’s cash cow drying up with Amazon searches may be an early indicator of the fate of profit driven networked platforms, still accounting for value using an industrial era market paradigm of transactions instead of transformation.

Regardless of where you stand on the evolution of our socioeconomic reality, our technologies today can deliver something, never before possible at this global scale. They can instantly close the gap between intention and outcome, matching resources for inputs, outputs and waste dynamically with demand. Delivering real ROI, our Returns On Intention.

Of course we don’t know if those who fear losing control of their current power position will see what’s here now as a threat, or the transition to greater prosperity for all that it represents. However, one thing is certain, and that is, our current systems were born out of seeking out Returns On Intentions, and the next systems will be no different. Because ultimately, intention is intelligent. It points to our deepest desires. In other words, it points to love, the driving force of our living existence here on Earth.

As the mystic poet Rumi wrote:

“Love is the whole thing. We are only pieces.”

I hope for the sake of our survival as a species, we realize the profundity of that, and focus on getting the returns we really want. The real ROI, instead of the instruments from a bygone era we believe will get us there.

Sure, we believe in trust more than the truth, however, in this time of great transition, trusting our intentions will surely lead us to the truth that is.

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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.

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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.

From the original notes to the video

Which new social structure are we evolving towards? Michel Bauwens tries to work this out by looking at contemporary practices that address the challenges of the future in the most direct way. He identifies an exponential growth of civil initiatives that experiment both locally and globally with new models and solutions. Behind the scenes, an entirely new set of values is being built up, with discoveries such as new types of contributory accounting to manage common property, open logistics systems for the circular economy, and so on. Michel Bauwens and the network of researchers into the emerging commons-based economy present a summary of 10 years of research.
• Michel Bauwens is a Belgian cyber philosopher and founder of the P2P Foundation, which carries out research into peer-to-peer-networks and practices. In 2013, together with Jean Lievens, he published the book De Wereld Redden, met peer-to-peer naar een post-kapitalistische samenleving (‘Saving the World: towards a post-capitalist society with peer to peer’).

Timecodes

These timecodes have been sources by William Charlton:

• 10:24 Kojin Karatani – The Structure of World History, Karl Polanyi – The Great Transformation
• 17:42 Giorgio Agamben – The Highest Poverty, Contributory Accounting, P2P Value – https://p2pvalue.eu/
• 23:50 Guerrilla Translation – http://www.guerrillatranslation.org/
• 24:08 David Bollier – Think like a Commoner – http://www.thinklikeacommoner.com/
• 26:00 Netarchical capital – http://link.springer.com/chapter/10.1057/9781137406897_4 and http://wiki.p2pfoundation.net/Netarchical_Capitalism
• 26:28 Hyper-Neo-Liberalism, Generative Value Regime
• 27:30 Enspiral – http://enspiral.com/
• 29:06 4 Forms – (Karatani) Pooling, Reciprocity, Markets and State Redistribution
• 29:49 Why Capitalism?
• 31:00 Cooptates
• 31:10 Terre de Liens – https://www.terredeliens.org/
• 32:43 Driftless Area Wisconsin – https://en.wikipedia.org/wiki/Driftless_Area
• 33:50 Reintegrate Externalities – https://en.wikipedia.org/wiki/Externality
• 35:30 Wikispeed – http://wikispeed.org/
• 36:50 Capped Investments – https://wiki.p2pfoundation.net/Joshua_Vial_on_the_Introduction_of_Capped_Investments_for_Commons_Projects
• 38:00 Douglas Rushkoff – Life Inc – http://www.rushkoff.com/books/life-inc/
• 40:00 Ethical markets in Middle Ages
• 40:28 Execute speculators!
• 40:56 100 industrial sectors. All inviable if externalities are included Ditto CAC 40 (French Stock market)
• 41:30 Corporations v Cooperation
• 42:20 Lamps that burn forever
• 43:00 Mutualisation
• 43:30 Jevons’ paradox – https://en.wikipedia.org/wiki/Jevons%27s_paradox – see also the Coal Question http://oilcrash.net/media/pdf/The_Coal_Question.pdf
• 44:00 Uber – the reality
• 46:09 Cosmo-localization – http://actionforesight.net/cosmo-localization/ and https://wiki.p2pfoundation.net/Cosmo-Localization
• 48:10 Mark Whitaker – Ecological Revolution: The Political Origins of Environmental Degradation and the Environmental Origins of Axial Religions; China, Japan, Europe – https://www.amazon.com/Ecological…/dp/383830022X
• 50:30 Mutualisation of knowledge, Mutualising infrastructure and relocalising production.
• 52:17 A political voice for Commoners
• 58:00 Trans-National Localisation
• 1:00:00 Q and A

Michel Bauwens – TEN NEW PRACTICES OF THE GREAT TRANSITION from Kaaitheater on Vimeo.

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