In order to rescue the following story in this series, we will travel with Henri Pirenne to the times of the birth of the merchant class and the rise of the arts between the tenth and fifteenth centuries. Pirenne was one of the great historians of the Middle Ages, and although his work focused on what would later become Belgium, the story we are interested in affects all Western Europe, because:

The “brotherhoods,” “charities” and commercial “companies” of the Romance-language countries are exactly analogous to the hanses and guilds of the Germanic regions. There is even a similar organization in Dalmatia. What has dominated economic organization are in no way “national genius,” but social needs. Primitive trade institutions were as cosmopolitan as the feudal ones.

So let’s go to the 10th century. The first merchants don’t have the glamor of their Renaissance descendants:

The sources allow us to get an accurate idea of trade groupings that, from the tenth century onwards, are becoming more numerous in Western Europe. You have to imagine them as armed gangs whose members, armed with weapons and swords, surround the horses and carts loaded with sacks, bales, and barrels.

They are armed because their life is nomadic and risky, constantly subjected to the dangers of the trips of those times.

In the same way that the navigation of Venice and Amalfi, and later, that of Pisa and Genoa, make far-reaching voyages from the start, mainland merchants spend their lives wandering through vast areas. It was the only way for them to obtain significant profits. In order to be able to sell at high prices, they had to travel far to the areas where products were in abundance, in order to then be able to resell them profitably in places where they were scarce, and therefore more valuable. The farther the merchant’s trip was, the more advantageous it was for them. And this is easy to understand assuming that the profit motive was powerful enough to counteract the fatigue, the risks, and the dangers of a wandering life, exposed to all hazards.

It is this continuous and dramatic risk that strengthens the social cohesion of the group. Neither can survive without the other. They themselves are considered a phratry, a group of “brothers”:

The standard-bearer marches at the head of the caravan. A boss, the Hansgraf or Dean, assumes command of the company, which consists of “brothers” united by an oath of fidelity. A strong spirit of solidarity encourages the whole group. Goods are apparently bought and sold in common, and profits distributed in proportion to the contribution made by each to the association.

This new kind of real community collides with the prevailing values at the time due to its nomadism and meritocratic ethos.

Other than in winter, the merchant of the Middle Ages is permanently on the road. Interestingly, the English texts of the twelfth century called them “dusty feet” (pedes pulverosi). These wandering beings, these vagrants of commerce, must have amazed the agricultural society with whose customs it clashed, and where there was no place reserved for them, due to their extraordinary lifestyle. It represented mobility among a people with strong bonds to the land. It introduced, in a world faithful to tradition and respectful of a hierarchy that determined the role and range of each class, a calculating and rationalist mentality for which fortune, instead of being measured by the condition of man, only depended on his intelligence and energy. We cannot be surprised, then, if it caused scandal. The nobility had nothing but contempt for those foreigners, whose origin was unknown and whose insolent fortune was unbearable. It was enraged for seeing them in possession of larger amounts of money than them; it felt humiliated by having to rely, in difficult times, on the help of these new rich.

Nor will the Church approve of them:

As to the clergy, their attitude to traders was even more unfavorable. For the Church, commercial life endangered the salvation of the soul. The trader, says a text attributed to St. Jerome, can hardly please God.

Freedom as identity

Because the merchant is a freedman who breaks the social scale, an upstart son of servants who “improves without improving his blood”:

The legal status of traders eventually provided them, in this society for which they were original for so many reasons, a totally unique place. Due to the wandering life they led, they were foreigners everywhere. No one knew the origin of these eternal travelers. Most came from non-free parents, whom they abandoned very young in order to live a life of adventure. But servitude is not pre-judged, it must be proved. The law establishes that a man that cannot be assigned to a master is necessarily free.

It so happened that it was necessary to consider traders, most of whom were undoubtedly sons of servants, as if they had always enjoyed freedom. In fact, they became free by loosing their attachment to their native soil. Amid a social organization in which the people were tied to the land and each member depended on a lord, they presented the unusual spectacle of going about without being claimed by anyone. They don’t demand freedom: it was given to them as a result of the impossibility of showing them that they did not enjoy it. In a way, they acquired it by use and by prescription. In short, just like the agrarian civilization had made the peasant a man whose habitual state was slavery, commerce allowed the merchant to become a man whose habitual state was freedom.

Gradually, fairs and markets become stable, and with them, the presence of merchants-artisans:

For these newcomers, association was the surrogate, or even the substitute of family organization. Thanks to it, a new, more artificial and at the same time simpler social grouping emerged among the urban population, together with the patriarchal institutions that had prevailed until then.

The artisans/traders didn’t recognize children of a marriage of a slave and a freedman man as subject to bondage. Moreover, if a servant came to town and was accepted as an apprentice, he was freed, for all practical purposes, and protected by the community. The law allowed the Lords to claim the children of mixed marriages or urbanized servants, but,

For the trader, the mere idea of such interference must have seemed monstrous and intolerable.

The arts and equality

Enter the arts. Their aim is to consolidate, through economic equality, that which originally had been a close cooperation between different “bands” of merchants/artisans to ensure survival. Within each art, competition was regulated to the point of making revenues and way of life equal for all members.

Among these men of equal profession, equal fortune and equal longings, close ties of friendship were created or, to use the expression that appears in contemporary documents, of fraternity. A charity was organized in each trade: brotherhood, charité, etc. The brothers helped each other, took care of the livelihood of widows and orphans of their comrades, jointly attended the funerals of the members of their group, participating side by side in the same religious ceremonies and in the same celebrations. The unity of feelings corresponded with economic equality. It constituted their spiritual guarantee, while reflecting the harmony between industrial legislation and the aspirations of those it was applied to.

The Arts were real communities, groups of artisans/merchants who knew each other and reproduced and developed in their organization a specialized expertise of their own. But their weight in cities is such that their lifestyle becomes the spirit of the city itself:

Rural organization was patriarchal. The idea of paternal power gave way to the concept of brotherhood. The members of the guilds and the charités already called each other brothers, and the word passed from these associations to the entire population, “Unus subveniat alteri tanquam fratri suo,” says the “keure of Aire”: “one shall help the other as a brother.”

Taking fraternity to city government

And that’s when the fraternity that characterizes the arts inwardly starts to become a project and a political myth, together with the demand for freedom associated with the end of the “right of womb” and their practice of internal egalitarianism. Their way of materializing this was simply hacking the feudal order by occupying public services, taking them for themselves:

They were no longer content with their corporate competencies. They dared to assume public functions and, facing no opposition from the authorities, usurped their place. Each year in Saint-Omer, the guild allocated its surplus revenues to the common good, that is, to road maintenance and construction of gates and walls in the city. Other texts suggest that something similar happened, from very ancient times, in Arras, Lille, and Tournai. In fact, during the 13th century, the urban economy in these two cities was controlled, in the first, by the charité Saint-Christophe, and in the second, by the count of the Hansa.

Officially, it had no right to act the way it did; its intervention is explained by the cohesion that was reached by its members and the power they had as a group

And by then the committees mercatorum of Carolingian times has already become Count of the Hansa, a title that did not come from royal or feudal merit, but from a tradition that was based on the very organization of the original caravans of merchants.

The contradictions between the first urban patricians and the arts will not take too long to arise. The latter would eventually end up openly fighting for the representation and the the power to organize the cities. In Liege, they will earn it intermittently beginning in 1253, and definitively as of 1384, and in Ghent, intermittently during the thirteenth and fourteenth centuries until the fifteenth.

This brings about a novel form of political legitimacy: the judges of the boroughs exercise power on behalf of the communitas (community), or the universitas civium (all citizens), and not on that of the civil Prince or the Church, but neither on that of the fraternity or brotherhood that binds together the artisans and builds the obligation to belong to a trade to exercise full citizenship (as in the Florence ruled by the arts). The community, however, was not defined in a trivial way. On the contrary, it required an identity and strong material relationships of each to the whole.

In the cities where there were courts, as well as in those lacking them, citizens were a body, a community whose members were all in solidarity with each other. Nobody was a bourgeois without paying the municipal oath, which linked him closely with the rest of the bourgeois. His person and property belonged to the city, and both could be, at any time, required if need be. You could not conceive the bourgeois in isolation, nor was it possible, in primitive times, to conceive of man individually. At the time of the barbarians, one was considered a person thanks to the family community to which one belonged, and one was a bourgeois, in the Middle Ages, thanks to the urban community that one was part of.

Fraternity, which was born as the characteristic relationship among caravan traders, had grown to define the foundation of the body politic. The result in Liege — according to Pirenne, “the most democratic system that ever existed in the Netherlands” — required that

All major issues should be submitted to the deliberation of the thirty-two guilds, and settled on each of them by recess or “sieultes” (verbal process through which the discussions of the diets are deposited.)

Urban communitas is actually a confederation of arts in which, although the commitment of each is made towards the whole city, deliberation and decision remained in the space where relationships did not require mediation or representation.

Conclusions

Brotherhood as a political myth is born of mutual aid among medieval merchants and artisans. It meant bringing the open and strongly cohesive logic of the arts to the government of the bourgeois city. This is why it would become the longing of the urban popular classes, but as we shall see, with the dilution of the rigid organizational framework of the art, the original idea of fraternity is transformed and becomes confused. It will no longer be the product of a series of interactions among peers that scale only through the guild confederation.

In the next installment, we will go back to the Greek classics to understand why “fraternity,” even if it remains one of the founding values of European political thought, became so difficult to define.

Translated by Alan Furth from the original in Spanish.

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Tine De Moor calls this a ‘Silent Revolution’ because it didn’t involve riots, but the construction of new social institutions. This is a big part of what is also happening now, and what the P2P Foundation has been cataloging, observing and trying to understand.

Article: The Silent Revolution: A New Perspective on the Emergence of Commons, Guilds, and Other Forms of Corporate Collective Action in Western Europe. By TINE DE MOOR. IRSH 53 (2008), Supplement, pp. 179–212

Excerpted from the introduction by Tine De Moor:

“During the late Middle ages, to an extent and with an intensity previously unknown, Europeans formed alliances which were based primarily not on kinship, but on some other common characteristic such as occupation. Guilds and fraternities were organizations providing good examples of that in urban settings, while in rural areas the late Middle Ages were the period when communal land tenure arrangements, or simply ‘‘commons’’, were increasingly frequently formed and then institutionalized. It is not the actual formation of such types of collective action that is so striking, nor did their institutional characteristics make the region in that period at all exceptional, for as the essays in this volume demonstrate, craftsmen and merchants formed guilds elsewhere and in other times.
It was, however, the great intensity of the formation of new units of such collective action that makes this movement striking enough to refer to it as a ‘‘silent revolution’’. A revolution, inasmuch as it was a movement which started from below, and because it might prove to have been as important to the ultimate course of European history as any other revolution; and silent, in that it was at first based primarily on tacit agreements between powerful rulers and demanding subjects, whether villagers or townsmen, and became explicit, which is to say written down, only after a time.

Mostly such agreements were formed peacefully. The rather discreet development of the forms of collective action described here means that for a long time it remained an unnoticed revolution too. Most attention in research into collective action has been devoted to short-term demands for change in the form of riots, protest demonstrations, and the like as motors of democratization and political change. In this article I will argue that the silent revolution to a large extent created the institutional infrastructure for socio-political change, and so for other forms of collective action which became characteristic in western Europe and came to be considered as a vital ingredient in preparing for its exceptional economic head start.”

Image by Andrew Taylor.

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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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