As our demands grow bolder—true full employment, the rebuilding of the social safety net starting with Medicare for All, an overdue green and just transition—so will the naysayers’ inevitable refrain: “How will you pay for it?” This Left Forum panel on June 5, 2018 moderated by Gar Alperovitz brought together the speakers listed above. They show a way out of the austerity trap and reveal that the obstacles to bold action at a national scale on jobs, healthcare, and climate are political, not economic. This is a partial, edited transcript.

Gar Alperovitz: One of the things that’s happening around the country, as you probably know, is  there’s an upsurge of interest in the idea that the banks ought to be under public control. There are public banking initiatives in something like 30 or 40 cities and a couple of states around the country. There was a forum on this  only six years ago promoting the idea. We’re seeing all over the country a very, very fast pick-up on this, including in Los Angeles, Washington D.C. and several other cities. State legislation pending in Michigan and Washington state.

The subject we’re going after today is probably the other piece of the puzzle, monetary policy and money, because there’s a revolution going on in that area as well. It’s not simply the establishment of public banks, but actually getting down to how money works, a subject that has been obfuscated for many, many decades.

We’re going to go into how the revolution is emerging very, very fast on the ground as well as in theory.

Our first speaker, Stephanie Kelton, is currently a professor of public policy and economics at Stony Brook University. She was also chief economist on the minority staff of the Senate Budget Committee. More important, she was the key economist behind Bernie Sanders’ presidential campaign, so we’re delighted to have her. She is also one of the leading experts in this field and getting a lot of attention, deservedly so, for not only for opening a way to rethink monetary theory or monetary practice, but for explaining it to the public in serious terms.

The ‘pay-for-it’ trap

Stephanie Kelton: I’m going to try to focus my remarks on three broad topics. I’m aiming at a progressive audience obviously, but honestly I give a version of this exact same talk most of the time to conservative audiences. The response that I get in those audiences, it would surprise you probably, is extremely positive.

What is it about what I’m going to say that can resonate both with audiences like this and with a very fiscally conservative audience? Let me jump in and we’ll see where this takes us.

This is just to tell you the kinds of things progressives are up against when they propose a big, ambitious agenda.

Bernie Sanders runs for president on the most ambitious agenda I have seen in my lifetime. Hillary Clinton publishes in her book a bit of an exchange she had with someone who said, “Man, it’s awful. Every time we propose something, he goes bigger. We say we want debt-free college. We want to help make college more affordable. He says, ‘Let’s make it free.’ If we say we want to make health care more affordable and increase access, he says, ‘Let’s just make it free.’ Every time we propose something, he goes bigger.” In this exchange that is included in her book somebody said, “This is like Bernie saying, ‘I think America should get a pony.’” Hillary, the fiscally responsible voice in the room says, “How will you pay for the pony?”

It’s the idea that all of this stuff is so grandiose that it’s beyond reality. This is what we’re up against as progressives, putting forward a bold agenda.

This again is Hillary Clinton, from years before the 2016 campaign, when she’s a senator. She’s talking about the reality of being in Washington D.C.She says, “The reality is you cannot cut taxes or increase spending unless you can pay for it.”

What she’s saying is, and I worked on the budget committee, if you propose to do something, you’ve got to show people how you’re going to pay for it. If you want to cut taxes or you want to put more money in education or infrastructure or defense or anything else, you’ve got to show where the money is going to come from. A congressional budget office has to take a look at it. Things are supposed to be done in a deficit-neutral way so that you’re not adding to future deficits so that you’re not increasing the size of the national debt.

Okay, so Senator Sanders gets accused of putting forward a big proposal and not paying for any of it, right? Everybody “knows” that. That was the accusation, but that wasn’t the reality. He actually attempted to play by Washington rules, which are you’ve got to pay for the stuff you want to do. If you go down his agenda, every item on the agenda, you could really draw a line from what it was he was proposing to the source of revenue that was supposed to pay for it all, whether it was Medicare, infrastructure, making public colleges and universities tuition-free. If you actually looked at what he proposed, it was paid for in the conventional sense of the word.

Now, obviously if you have to find the money, as Hillary Clinton says, then where do you look when you need money? Who’s going to pay for stuff? Who’s got the money? Obviously the rich people have the money. It’s a natural place to look when you’re trying to find the money to pay for a big ambitious agenda. You go for the billionaire class or you go for Wall Street, and you say Wall Street will pay.

If it’s making public colleges and universities tuition-free, which was one of the things he proposed, the pay-for on the other side of that was a tax on Wall Street speculation. You’ve all heard this probably 100 times.

How do you pay for a progressive agenda if these are the constraints because this is the current narrative? This means that you have to fight two battles. You have to fight for the agenda that you’re fighting for, and you have to sell policies on their own merits, and you simultaneously have to wage war on another front, which is you have to fight to raise the revenue. You have to get people to vote for the tax increase, for the closing of the loopholes of whatever it is that’s giving you the additional revenue. You’re waging two battles when you do this. My spending proposal is this, and here’s where I propose we get the money. This one can’t happen unless and until this one happens and you have success on the revenue front.  It actually means that you are in a very real sense dependent upon the rich because you can’t feed a hungry kid, you can’t fix crumbling infrastructure, you can’t provide health care for all, unless and until you can claw some cash away from the people who have it. You need their money. It makes you dependent upon the wealthy.

I think progressives should ask themselves, “What is the purpose of tax?” If your instinct, if your impulse is to say to pay for the stuff we want, my suggestion is you’re doing it wrong.

Rethinking taxes

In the 1940s, the New York Federal Reserve Bank was headed by a guy named Beardsley Ruml. He wrote this really important piece in 1946 called “Taxes for Revenue are Obsolete’” What’s he saying? I don’t know that I need to read the whole thing, but he says basically the need for the government to raise taxes in order to remain solvent and run its affairs is completely yesterday. We don’t do that anymore. Why? Because we have a central bank and because we went off the gold standard. The fact that we changed the monetary system in this fundamental way opens up space for us to do stuff we couldn’t do before when we had to find the money.

You’re trapped in a gold standard framework when you’re operating in this frame of mind that money is this finite thing that exists somewhere, it’s physical and you’ve got to find it, and you’ve got to go get it in order to spend it. Ruml says, no, no, no, that’s not how it works in the modern era – by the way, modern in the 1940s, and we still haven’t caught up with this reality.

Ruml goes on to say the purpose of the tax is not to fund the federal government. The purpose of the tax is multifold. One important thing it does is it allows the government to remove some money from the economy so that you don’t overheat the economy through government spending. In other words, taxes help you keep a lid on inflation. If you just spent money into the economy but you didn’t tax anything back, you’d run the risk of overheating the economy, causing an inflation problem.

Another thing taxes do is affect the distribution of income. You lower taxes on some folks, they end up with more take-home pay. You raise taxes on others, it takes the money away. You impact the distribution of income. You use taxes to incentivize or disincentivize behavior. A carbon tax is a good example. You don’t want as much pollution. You don’t want certain activities taking place, put a tax on it. You want to encourage certain other things like people driving electric cars, give a tax incentive or some form of a subsidy to encourage that.

The last one is he says you might want for some reason or another to have a line item where you can keep track of a certain program, like for example Social Security or the Highway Trust Fund or something like that. Taxes do a lot of stuff that’s important. What they don’t do is provide the government with revenue that it needs in order to operate.

Go back to this picture. You don’t tax the rich because you need their money in order to feed a hungry kid or fix a crumbling bridge. You tax the rich because they are too damn rich and extreme concentrations of wealth especially, but also income, are bad for the functioning of the economy, are bad for democracy. That’s the rationale for taxing the rich. Not because we can’t do other things unless we get money from them to pay for it.

You tax Wall Street speculation because you want to discourage certain behaviors, not because you need their money that you raise from a financial transaction task in order to pay for free college. Think it through. Suppose you said, “We’re going to make public colleges and universities tuition-free in the US. It’s going to cost about $70 billion a year to do that.” Now, to pay for it, we’re going to put a tax on Wall Street. Every time somebody buys stocks or engages in derivatives trading or bond trading, they’re going to pay a small transactions tax. That’s our tax.

Now, you simultaneously have said you want to break up the banks, you want to make banking boring, you want to shrink the size of the financial sector, and you have made yourself completely dependent upon what in order to fund your education proposal? Wall Street speculation. Not only do you need Wall Street to continue to speculate, but you’re going to need them to do more of it over time and grow because of the amount of money need to pay for college and university. You don’t want to hitch your wagon to the very thing that you loathe and are trying to shrink as part of your overall economy. There is a rationale for doing it, right? That would be to discourage certain behaviors, not to fund programs.

The household fallacy

My argument is that when we think about the government’s financial operations we tend to do so with reference to our own. We think of the government as a household. I say, “Well, I can’t go on spending more than I take in year after year and borrowing. I’d go broke.” This is a huge mistake, and if progressives do it, they need to stop it right now. The federal government is nothing like the household. The federal government plays by a completely different set of rules compared to all the rest of us.

If we want to go out and buy a car tomorrow, we have to have the money in the bank or be able to prearrange the financing. The dealership is not going to let us drive off the lot with a car until we have security financing to pay for the car, right? What we think is that the government prearranges its financing – the T.A.B. or “taxes and borrowing”; it collects taxes from the rest of us, it engages in borrowing when it sells bonds. It arranges the financing. It raises the revenue. It has money and now it goes out and spends. The spending comes last.

That’s completely backwards. What happens in reality is the federal government – the House and Senate – get a budget together. If the budget passes, there’s an appropriations process. It is through the appropriations processes that the budget authorization for government spending is triggered. That’s how the government pays for everything. We spend first, and the taxes and borrowing are secondary. The rest of us can’t do this. Money matters.

The fact that the federal government has control of the U.S. dollar, creates it, issues it, and is its sole source, means it can never run out of money.. You can try to create it, but you’d get arrested for counterfeit. You can’t do it. You can’t create high-powered money. The government’s money is special.

How should progressives answer the question, “How will you pay for it?” It’s a trap. Don’t fall into this. What they’re really asking is not how will you pay for it but who will pay for it. The question is designed to name the enemy. Who’s going to be footing the bill? In other words, who’s paying the T.A.B.? Don’t answer that question.

The bottom line is all this pay-for stuff is built around the idea that deficits are bad. They aren’t. Dr. Evil told us a long time ago that deficits don’t matter. Well, it turns out they do, but not the way we usually think about it. Deficits matter, but not because they add to the national debt, burden future generations and all that kind of stuff, create instability in the economy. Deficits matter because the government’s deficits become surpluses somewhere else in the economy. Guess what? Dick Cheney knows it and the Republicans know it. How do I know that? Because they just passed tax cuts that will add $1.5 trillion to deficits over the next 10 years. Why did they do that? Because they know that when a government is increasing its deficit somebody else’s surplus is going up, and they know exactly whose surplus it is. They’re using the budget deficit to channel financial resources to the people they are trying to help. Democrats or Greens or whoever could be using budget deficits to channel financial resources, infrastructure, real things, to the people they’re trying to help.

How should progressives talk about money, debt and taxes? Don’t repeat this stuff about taxes paying for federal government programs. It’s not taxpayer money. This is the wrong frame. Don’t talk about the debt as if it’s something that we owe. It’s something that some of us own. You may have treasuries. Mostly they are concentrated in the hands of wealthier individuals. Don’t talk about government money as if it’s something that the government needs to get from us. They’re the source of the money. We get it from them. They don’t need it from us.

An economy on FIRE

Gar: The next person is going to give us the next step. Michael Hudson is the distinguished professor of economics at University of Missouri, Kansas City. He’s also a research fellow of the Democracy Collaborative. Michael has been in this for a long time. Michael, take it away.

Michael Hudson: My first discussion of modern monetary theory really was in Canada 40 years ago. I was the financial advisor to the Canadian government. At that time the big problem from Canada was how provinces would get enough money to build infrastructure. I’m going to talk a little bit about that because it’s the same problem that the United States is facing today. You can understand it, I think, more clearly in the international sense.

There are two ways of financing infrastructure. One would be if the government, the Bank of Canada, which was more than any other bank able to create its own money, spent the money into the real economy for infrastructure. The banking lobbyists – I won’t call them conservatives; they were radical reactionaries and lobbyists for the banks – said, “Look, if the government creates the money, you’ll have to borrow it, and you’ll have to pay 5 percent, 6 percent, but you can save half a percentage point by borrowing German marks or Swiss francs.”

This was Trudeau’s liberal government, and you can’t get more right-wing than the liberals in Canada. What they did was they borrowed billions for Deutsche marks and Swiss francs that were turned over to the government central bank. What did the government do? All this domestic spending in the real economy was in Canadian dollars to hire Canadian labor, to buy Canadian goods and services, to build the infrastructure.

My point was, why do you need Swiss francs and German marks if you’re going to create dollars? The Swiss francs and German marks ended up in Canada’s central bank as its foreign exchange reserves. What did it need these reserves for? If the government is going to create the money as a result of this borrowing abroad, why have the foreigners?

Well, the answer from the banks was you need the foreign banks as an honest broker because they’re responsible. In literature, you think of bankers as being responsible, but they’re really not responsible. What happened after 1979 was that the Canadian dollar went down from about $1.06 into the $0.80s. The Swiss franc went way up. The German mark went way up. The result was that Canada had to pay a 50 percent premium on the capital as a result of having the banks work as the honest broker for them.

None of this was necessary. The government could spend it into the real economy. The problem is the private sector is not just the real economy. The private sector also is the FIRE – finance, insurance and real estate – sector. You can see today the ability of the government to spend money into the economy through the Federal Reserve’s quantitative easing, technically bailout money to subsidize the finance, insurance and real estate sector. This is considered to be noninflationary.

Who gets to create money

You have to ask, what kind of inflation are people talking about? When they talk about government spending into the real economy and running deficits, they say there will be price inflation. What they really mean is wage inflation. What they want to do is keep wages down. When they talk about inflation of prices, they really mean living standards going up. We don’t want that, do we, because we call that consumer price inflation. We don’t call that rising living standards. The fact is, there’s a disconnect. There’s no reason why consumer prices should rise when wages go up. There’s a disconnect with the largest increase in prices that we have today, whether it’s housing prices and rents, as you have in New York, or medical care.

The government is able to create money now for the financial sector, but there is this patter about why you can’t run a deficit for the domestic economy. Now, what is true for Canada is exactly what Stephanie has explained for the United States. Banks can create money simply on their computers. If the rich people lend this money to be spent, how is the price effect any different from the government simply creating the money? The effect is exactly the same. That’s what they don’t get. You don’t need to borrow to spend into the economy at all. It’s a science fiction story, a parallel universe, as if the governments are somehow dependent on the banks.

All this developed about 100 years ago when the Federal Reserve was created in 1913 and ‘14. Before that, there was a crisis in the United States in 1907. Congress had maybe 18 volumes of national monetary commission reports. One of the volumes explained everything that the Federal Reserve had done, creating money, moving it around 12 districts, pumping it into the economy for the autumnal drain when you have to move the crops. All of this was done by the treasury. The difference is that the treasury was controlled in Washington. I have on my website from an Indian journey all of the documents of how the Federal Reserve was created, essentially to take control of the money supply out of Washington and distribute it to the banks in the various Federal Reserve districts.

You have a whole political fight between the FIRE sector and the government sector. You can only understand this fight by looking at the politics of it.

Unforeseen financialization

The fact is that Karl Marx was much too optimistic about the financial system. His volume three of “Capital” was all about how finance tended to grow and extract more and more from the economy. The FIRE sector today essentially funds real estate. It extracts rents. It raises prices. It backs great monopolies. Banks don’t create money into the real economy basically. They create money to buy companies, divide real estate already in existence. They transfer wealth, but they don’t really produce.

I’m working with Gar’s group to re-describe how the gross domestic product accounts. We actually treat the FIRE sector, finance, as a subtraction from gross domestic product, not an addition to.

Getting back to Marx, Marx expected in the late 19th century that the historical destiny of capitalists, he wrote, was to take banking and money creation out of the feudal stage, out of the medieval European stage and industrialize it and essentially move towards public banking. The whole 19th century was doing this. There are three volumes of the national monetary commissionary report on the right spot for the large German banks and how German banks were working hand in hand with government to finance industry. The Bank of Canada was formed during this time.

Things had not worked out that way. World War I changed everything, and now you have instead of industrializing finance, you’ve had a financialization of industry. What you’re having instead of the government spending into the real economy, it’s starving the real economy.

What happens when a government doesn’t pump money into the economy? That means there are only two sources. One source is international. You borrow the money abroad in a foreign currency that you’ll have to repay at a currency risk. The other source is domestic; you borrow from the banks or you let the banks pump the money into the economy. The problem is the banks don’t pump the money into the economy. The banks only lend essentially for the real estate, corporate raids, corporate loans. They even make loans to corporations to pay dividends. The beneficiaries are the 1 percent or the 5 percent.

The real question of the budget deficits or modern monetary theory is who’s to get the benefit of the money? Will it be the 1 percent or will it be the 99 percent? The answer can be increasing the flow of funds, and the flow of funds, who gets what will make it very clear. Who gets the result of the government spending in forms that do not take the form of a deficit or if it runs the deficit, is it into the real economy or the FIRE sector? You need to divide the private sector into FIRE and into the industrial, agricultural and infrastructure.

Gar: Let me say, I suspect there are people out there, because I’ve done this myself several times, who hear the words ‘the banks will create the money’, and that doesn’t ring straight for most people, that money is actually created. Those questions, I’m sure, are going to hang in the air into which modern monetary theory has the answers. I want you to understand that.

Another way to think about it, although we can easily get into a trap about taxes here: When the government wants to run a war, money does not seem to be a problem. It creates money when it wants to, and it taxes back some of it if it likes to. By way of comment, having talked to a number of folks, the word ‘create’ kind of gets in the way sometimes if you’re not economists.

Fear of a job guarantee

Our next speaker is Pavlina Tcherneva, an associate professor and chair of the department of economics at Bard College and a research associate at the Levy Economics Institute. She’s led the way in showing very, very practical applications of the theory.

Pavlina Tcherneva: Thank you. You are all, I’m sure, familiar with the seven deadly sins. Today I would like to address the seven deadly fears of economic policy. Mostly I’d like to address and face those fears and how to defend a progressive agenda, whatever that may be.

The policy proposal that I’ve been working on for 20-odd years is an employment program that has become known as the job guarantee program that has recently entered the mainstream conversation. A number of senators and representatives have endorsed the program. There are lots of versions of the program out there, but it is a recognition that the government has a responsibility to do something about the persistent problem of unemployment.

What I’d like to do today is basically address some of those seven deadly fears. As the program has discussed, there’s a lot of response, both on the right and on the left, and a lot of it is quite alarmist, frankly. I’d like to ease our fears by addressing each one of them.

First, what is the job guarantee? Essentially, it’s a public option for jobs that offers decent work at decent pay. The public sector acts as an employer of last resort, if you will, when people seek work and they’re unable to find good work at decent pay.

It is a permanent program. The unemployment problem is an ongoing problem, and thus, this program is a standby option for jobs. It’s federally funded but locally administered. It’s voluntary. Nobody is asked to work for their benefits. It’s open-ended. You can go to the unemployment office, and you seek work. There will be a list of options for you. The way we propose it is that those list of options will largely focus on public service and the neglected areas of public sector work. It’s open to all people irrespective of their labor market status, race, sex, color or creed.

The way I think of this program is that it’s an employment safety net, the way we have safety nets for various other problems. If the problem is that you don’t have retirement insurance, we guarantee it; we have Social Security. If the problem is access to food, we guarantee that there will be access to food.

It’s also a transitional program where people essentially get their starter jobs if they need to. They get their stepping stone. They enter into this program and then transition out of it if they so desire.

Overcoming the spending myth

Let’s discuss the fears. The first one that we normally have to address is the fear of spending. It’s based on a deep misunderstanding of what money is and what it does. Again, Stephanie explained how normally there are images that are conjured in our mind that, “Gee, my hard-earned money. I’ve been saving it, and now the government wants to tax it away from me so that it can pay for these policies. Who knows if they’re going to be good or bad?”

We just need to give up this myth of the taxpayer money because this is not how actually the public sector spends. I want to add one other purpose of taxes to the list that Stephanie provided: taxes create demand for money; for the dollar, in a sense. Just think of it this way: If the government tomorrow decided to tax you in Canadian dollars and April 15 you have to deliver Canadian dollars or euros, what will you ask your employer to pay you? Will you ask them for dollars or will you ask them for euros? The tax in this coercive way, if you will, creates demand for the very thing that the government issues: the dollar. The reason is the government needs to be able to spend something that we value to be able to fulfill its various public service objectives.

Here’s one way of thinking about it. The government is the monopoly issuer of the dollar. It is the ultimate source of dollars. Unemployment in a way is people seeking dollars but not able to find them. Whatever the other arguments for addressing the problem of unemployment, and we can discuss that, there is one key aspect to this problem. It is that there is only one sector that can actually choke up the demand for dollars. There’s only one sector that can actually provide it to those who need it, and that is the public sector.

Another piece to the story is that the unemployed are already in the public sector. The government is already responsible for the unemployed. We do the right thing. We provide unemployment insurance, as inadequate as it might be. We provide various other income supports, even though those programs are also underfunded. We have this understanding that we have to provide for people who don’t have access to decent employment or decent incomes.

We provide a slew of programs, but we don’t provide the one that many people need, and that is employment. We are not only responsible for the unemployed, but we also bear the costs of underemployment poverty. If you think of virtually all social, economic and political problems, in one way or another they are connected to communities that have lost their economic life, people who have lost economic opportunities. The distress that families feel not being able to provide for themselves. These are large invisible but very real costs that we already bear.

The fear of spending is the first fear that we need to debunk. This is a bit of an esoteric point, but I want to put it out there. If the government sector is the monopoly issuer of the currency, and it provides the currency in exchange for employment in the public sector, public sector work, then there is an exchange. We establish some sort of baseline value for that currency. We anchor the value of the currency and labor power. We know exactly what it is worth. It is worth $10 or $15 for one hour of publicly useful labor. In a sense, it’s our gold standard. It uses not gold, but it uses labor to anchor the value of the currency.

Big numbers and big government

The next fear is the fear of inflation. I think that that is really the fear of big numbers when we estimate what a job guarantee would cost. We have a proposal that you can find at the Levy Institute website that estimates a job guarantee would cost between $300 billion to $500 billion a year to employ 50 million people. A lot of people have said, “Oh gee, this is an enormous program. It’s going to be very inflationary.” Is $300 billion really inflationary? The Department of Defense, including the war budget, is about $900 billion. Social Security is upwards of $1 trillion. Medicare is $700 billion. Medicaid is $600 billion.

Somehow $300 billion is supposed to generate this massive inflation that will erode the value of the currency. This is not really the problem. A lot of people are actually worried that this actually might push up wages, that it might actually provide wages at a decent living level. We understand that the job guarantee will be the effective minimum wage for the economy, so why would you work for $7 an hour if there’s a public option of $15? The private employer has to match this. We have modeled this, and we find negligible impact of this very bold program on inflation.

The other thing that virtually everybody misses in this discussion is that a one-time adjustment in prices and wages across the economy, across the board, is not inflationary. Inflation is when prices keep going up. If the wage goes up from $15 to $16 to $20 to $25 to $30, then the private sector will have to match it. Yes, that will be inflationary, but no, we are anchoring the floor. We are raising the floor, and we are anchoring it at $15.

The second piece that everybody misses is that the job guarantee actually shrinks when the economy is growing. When the economy is growing, when private employment is growing, when there are ”inflationary pressures” in the economy, the program shrinks. Actually, it’s a dampening effect on inflation, not a fueling effect to inflation.

There’s a fear of big government, of course, but most people ignore the fact that we already have big government. What I already pointed out is that government has devoted enormous amounts of financial and real resources to deal with the fallout from unemployment, underemployment and poverty.

In this sense, the way to think about this is that the job guarantee actually reduces the costs of unemployment.

Whatever you discuss, whatever your policy priority is, always separate the financial cost from the real cost.

When you defend Social Security, don’t fall into the trap of this discussion of how will we pay for it. The question is what would we do with a whole bunch of people who are retiring who don’t have the goods and services that they might require to live a decent life. It is not a matter of financially providing for them but providing for them in real resources.

It’s the same thing with unemployment. It’s not the problem of paying for unemployment, but the problem is, do we really want to maintain this paradigm of neglect, of abandoning our public spaces, of abandoning our public purpose, of allowing people to suffer all the consequences that come with unemployment.

Double standards

There’s also fear of the administrative burden. This is a unique double standard that the job guarantee faces. We never hear that we can’t go to war, we can’t engage in nation-building because it’s going to be an administrative nightmare. The job guarantee uses the existing institutional infrastructure to simply expand the number of jobs out there.

Is it really so difficult to employ 50 million people? Is this really the biggest problem that the government is facing? Well, public education serves 50 million students. Nobody is saying we have to take it away because it’s an administrative nightmare. Social Security, 50, 60 million people. Medicare 44 million. Medicaid 70 million. Yeah, it’s easy to sign a check, but all of this involves a fair amount of administration, and we don’t discuss these.

Fear of boondoggles. This was the fear during the New Deal that somehow the government is going to create bad jobs. Well, just go to the Living New Deal map, and you will find what we did and the legacy that we left. Don’t fall into the trap of productivity. What’s the productivity of these jobs? It’s a natural impulse to say, “But what will people really do?” I can give you a very long list of what they can do. Good useful jobs. The way to answer this question is what is the productivity of the unemployed today? It’s negative productivity. You have malnourished children that go to school because their parents don’t have income to provide for them. That is the productivity you need to be focusing on.

Finally, there’s the fear of political revolution. This was raised by Robert Samuelson in The Washington Post. He says, “Imagine people who work in the private sector who suddenly realize the public option provides Medicare and child care, and they don’t have it. This is going to be enormously disruptive to the business as usual model.”

Look, in information technology, disruptions are considered great, right, progressive. In public policy, disruptions are awful, terrible. This is a defense of the status quo. It is the defense of a model where firms are only profitable when they pay poverty wages. We don’t want to defend this model. We want to disrupt it.

Finally, I think all of this amounts to pure change, but Americans are really not so afraid of it; a recent survey showed that the job guarantee had overwhelming support, and even in deep red states upwards of 70 percent of respondents supported it.

Those of us that have been working on this project are very encouraged, excited that it is in the mainstream, but my cautionary note is that we put way too much on the shoulders of the job guarantee. We have had decades of neglect of the public sector. We have enormous environmental challenges. We are suddenly putting all of these problems on the shoulders of the job guarantee and saying, “Hey, look, see, this is the program that will solve these problems.” It will not.

This program provides jobs for all. This program is a very crucial piece of the progressive agenda, but we need so much more than that.

Rethinking the monetary system

Gar: I want to introduce Raúl Carrillo, who’s the staff attorney at the New Economy Project and a member of the board of directors at the Modern Money Network, and he’s going to talk about actual on-the-ground projects that he’s working on and how they relate to this theory.

Raúl Carrillo: What I’m going to try to do, depending on your opinion, is synthesize or bastardize some of the ideas that were just presented by three of my heroes here and articulate those in a language that is useful, I think, to organizers, activists, people who are in this economy trying to heal the wounds, trying to take care of other people, trying to actually introduce some of these intellectual paradigms to work on the ground.

I’m particularly going to focus on two movements that I’m a part of. The first is the Modern Money movement. I’m affiliated with a number of modern money organizations, but principally Modern Money Network, which a few of us started several years ago when we were law students at Columbia and activists. We started thinking how does this kernel of what we consider to be factually correct analysis of the economy connect to law, organizing, technology, all these other things? How can we build bridges? How can we create packages that are useful for activists and organizers to use?

Over the last five years or so we’ve held about 70 symposia in the United States, United Kingdom, Germany, Australia, Brazil and a few other places, trying to connect MMT (Modern Monetary Theory) to other things.

The other one is that I work for the New Economy Project, which is a 20-year-old nonprofit here in New York City, and we do two things. One is we fight corporate power. I personally operate a financial justice hotline where folks can call when they have problems with banks, debt collectors, landlords, etc. They come to the office. We try and help them out on a very individual level. We also bring some impact litigation.

The second thing that we do is community economic development. We try to build community land trusts, financial cooperatives. We work with co-ops, all the good stuff that I know a lot of people in the audience are involved in already.

What is “the New Economy movement”? The essential idea is we’re trying to move out capitalism, but we have a very, very strong focus on environmental sustainability. The production system with FIRE (finance, insurance and real estate) on top of it, as Michael mentioned, is tricking us, so how do we get out of here?

The New Economy Project has a particular focus on something called the “just transition,” which arose in the 1980s and 1990s. The idea here is that we don’t just want to go to an economy that’s more sustainable. Along the way we want to heal some of the wounds that have been caused. We want to help people who face the biggest threats from ecological disaster. That means a particular focus on racial justice, gender justice, all the various forms of social justice that need to come along with a push to an environmentally sustainable world.

How does Modern Monetary Theory help? I’m actually going to borrow a quote from one of the organizers of this panel: ‘What MMT and PK theory does is it concentrates our minds on the real limits, on the real things we need to make more sustainable.” That means we’re focusing on the real: What’s happening to people, what’s happening to communities, what’s happening to the planet.

The dig-burn-dump economy

If we’re talking about an economy with limits, money is not necessarily the enemy. In fact, a lot of MMTers agree. A dear friend, Fidel, often says our economy runs on waste now. One of the fears, fear of waste for the job guarantee, fear of financial waste, fear of fiscal waste. That’s nothing. We make that stuff. It’s a legal construct. It’s a social construct. Really, the problem is when money is used to burn up a planet.

This is how an environmental justice group in Oakland called the Movement Generation Justice and Ecology Project describes the process that the industrial production system applies to our planet and thus to us: We dig up resources, we burn them, then we dump the waste, we churn it up.

Not only does the industrial production system do this to nature, but the financial system does this to people. FIRE burns people. It’s right there in the name.

What does the FIRE system do? It converts a participant in the economy, you or I whether in our capacity as a worker, a tenant, a borrower, a debtor of some sort, and it turns us into nonrenewable participants. It treats us like it can draw money out of us and then discard us, whether that’s in a place of employment, whether that’s in the credit system. It treats us like we’re disposable. We are waste.

How did we get here? Again, lots of different leftist stories on how this is done, but I think that MMT adds a particular element to this. We all know the story of enclosure, property rights, etc. People become dispossessed. They become part of a labor force that is roving. We don’t have property. We can’t work just for biophysical resources. We can’t just find some land and grow some food, even if we wanted to. We have to pay taxes. By taxes, what we really mean is any kind of fines, fees, obligation with the state. That means the fees you get for walking while black in Ferguson. That means student loan interest. That means a wide variety of things.

The point is the system is set up so we have to get money, and people take advantage of that. Now capitalists are not only trying to control the means of production. They’re trying to control the means of the means of production, the FIRE system, as well as the industrial production system.

How does this system keep going? It acts like the money comes from the users, from the resources that are being used rather than by the system itself. We talked about the taxpayer money frame, how that’s particularly harmful. When we think that the money to keep a machine running has to be extracted from people, we get some really terrible political dynamics.

The other lie is that banks are just either making money wildly or they’re using our deposits and turning back around and the banks rely on us. I would say that the banks are rogue public utilities. They have been chartered by the government, licensed by the government, regulated by the government, and they’re out here not doing their job. When we talk about pushing them to do particular things, we have to recognize that it’s even worse than we thought. They’re powerful. They have the money power. They can create and generate credit at the point of lending. They can do a wide variety of other things that are very, very terrible.

Austerity makes room for financial extraction. If the government is not putting money into the economy, the banks are controlling the borrowing process, and we’re all going to die if we don’t stop it.

Money doesn’t grow on rich people, not on wealthy taxpayers, not on banks. What we want to do is get the money power away from the banks, away from rich people by making claims on the state. You’ve got that giant piggy bank, call it what you will, money can come out of the state. Monetary sovereignty means that you can spend on people, on planet, on communities.

The way that we stake our claim and make the state do that is we establish rights to the things that we want. Then the dynamics for fiscal spending become repooled. We pull money out of state coffers, depending on how much we need based on each eligible individual instead of waiting for whoever in Congress, rich folks, to write that check and change the dynamics.

Basically what we’re talking about here is that MMT allows activists and people to, once they establish rights, pull money out of the system rather than wait for them to push.

What does that mean for activists, for organizers, for leftists? We’re establishing rights. We’re marching for jobs. We’re marching for various other freedoms. We want the entitlements. Fiscal austerity is the enemy even though we might want to be austere towards nature and other sorts of respects.

The plant-nurture-thrive alternative

Now I’m going to go out on a real, I think, new limb here. I’m going to suggest that MMT combined with a new-economy focus on environmental sustainability can take us away from the dig-burn-dump model and into a plant-nurture-thrive model.

Plant. We establish rights with this right to housing, with its right to jobs. We free up space to grow, to pool funding and to have a space outside of the profit motive, even outside of the revenue motive. We can start to do new things within that space. We fertilize the space with more of that sweet, sweet money from the public government. We can start to heal wounds, start to do things more equitably. People from bad sectors will leave to new jobs and a job guarantee. People from bad buildings will leave to new houses and new forms of shelter with the home sprawl movement that’s going on.

I’m just going to do a little bit of implementation here and talk about how MMT can potentially change things. I think that public money for public purpose is awesome, and that’s going to give us a platform to do new things. Eventually, it can be public money for public power. We can do even more. The way that dynamic works is by reversing essentially the dig-burn-dump cycle that we have going on here.

We can eventually move on to even stronger things like unions, to collective bargaining. People leave spaces that are extractive. No one wants to be a part-time prison guard anymore. No one wants to work in fast fashion. No one wants to work in fast food. Not necessarily everybody is going to leave, but it provides people with the opportunity to do so, so we can move again towards a regenerative economy, towards people leaving extractive industries.

Eventually, you can layer on democratic processes into the job guarantee, into the new space that’s been created. Participatory budgeting and worker co-ops can fold into the job guarantee.

Just two more examples of implementation. Extractive finance in housing is dispossessing people, either through the initial capture of land or gentrification. The landlord is in charge. The landlord kicks you out. The landlord doesn’t like you. The landlord segregates people. You get redlined. You get gentrified. You get surveilled by all these crazy consumer reporting systems. Then the threat of homelessness keeps you in line. This is true even for the middle class who’s enthralled to the banks, if not to landlords.

With MMT, what does it look like? You establish a right to housing. MMTers don’t necessarily believe in that, but I do. The point is that you can establish a right. You create a space. Once it’s guaranteed that everyone gets this thing, now you have room to maneuver. The rights pull the money down to tenants. You can have things like social housing projects. Then you can start doing things that are more democratic over time. Community land trusts, mutual housing associations. These things can all be contemplated once we have the funding and public capital. Again, that sweet, sweet fertilizer.

In East Harlem, the New Economy Project is helping to build a community land trust where you take land off the market, the residents own it. These things can be helped by MMT.

Finally, everybody is familiar with the access to credit scenario. I think that in and of itself is a problem that we think that people don’t have enough loans. Really what we want is for people to get more money, for people to get money from the state and from benefits. More people will get higher wages whether that’s through a job guarantee program or something else.

In the instance that people need credit, right now they’d be set with a bunch of predators, whether that’s payday lenders, whether that’s banks acting terribly, whether it’s this new fintech stuff from online, which actually turns out to be just as predatory as the analog version. What you can do with an MMT framework is again, establish public infrastructure. Establish rights. You can do some forms of postal banking. You can do public banking. From then on out the threat of you having to go to a payday lender is gone, so you have room to maneuver. Again, political room and fiscal room. You can start doing things like complementary currencies. You can start doing things like public banking. You can start doing all these more democratic things once the public sector is putting pressure on the private sector and giving civil society room to grow.

As you see here, there is a regenerative model for all of these things. You just need the public money. My friends in Reston, England have a complementary currency program. They generate money, or you could say their own forms of IOUs, which they use in the local community so that people only do business with local business. They’re keeping what they call “clone town London” out of there. These are acceptable in receipt of taxes, which is very interesting.

Finally, Gar mentioned the public banking movement. The New Economy Project and a coalition of other grassroots groups are launching an effort to create one here in New York. The idea there is that the public bank will generate credit to lend to democratic enterprises, ideally we would want federal money, but this is something that is powerful that municipalities can do, and in the process we can highlight a lot of what money really is. It’s a public feature that should be used for the public good, and we can do a lot of political education with this as well as whatever material healing help to organizations throughout New York City. Public money for public power.

Gar: Let me just say one thing. I’m from Racine, Wisconsin. I had an aunt who ran a little tiny Jewish bakery. She used to say, “You know, during the Depression there wasn’t any money around. Then they decided to run a war, and there was all kinds of money around. Why can’t we do that when we want to do that?” That is probably the point.

Photo by kevin dooley

The post Money Matters! Why Monetary Theory and Policy Is a Critical Terrain For the Left appeared first on P2P Foundation.

The British web magazine Beshara just published an interview of me, “The Revival of the Commons,” by Editor Jane Clark. It’s a beautifully presented webpage. Here’s one excerpt:

Jane:  …When there is this deep encounter with other beings, it triggers a natural desire to reciprocate, to share and communicate. So perhaps the commons brings out that aspect of our humanity which naturally desires to work toward the flourishing of our fellow creatures?

David: Yes, and I think this is why there is a kind of invisible tropism towards the commons. People sense precisely this potential of the commons and, without fully understanding or even if they have certain resistances or skepticism, they are nevertheless drawn to it. Through the many talks I have given and the conversations I have had over the years, I have come to see that the commons appeals to something very deep in people. It is about making human connections, about speaking to larger circumstances in life – and to deep time, both historical and present day. And it does so without all the encrustations of theological dogma.

These days there are very few discourses available to us where we can explore these matters outside of a theological one. Some kind of broad, cross-cultural exploration of our common humanity is long overdue. So I think that this aspect of the commons will grow as more and more people become involved with it.

Here’s another general introduction to the commons: an interview that I did with Adam Simpson of the Next System Project. The podcast — Episode 17, “Social Transformation Through The Commons” — is a 35-minute conversation that covers the basics about the commons. Adam was quite skilled in asking the right questions and eliciting things that might not have otherwise occurred to me!

Last Thursday, I had the pleasure of visiting Kingston Radio, WKNY, in Kingston, New York, where Jimmy Buff is showing what a community radio station ought to sound like! Amazing diversity of music, news, cultural perspectives, and community-building. Jimmy interviewed me about the commons, and Peter Buffett, Co-President of the NoVo Foundation, about the state of the world.

Finally, I’m pleased to have played a role in a newly released theatrical film called 24 Davids, a documentary by Canadian filmmaker Celine Baril.

The film is an idiosyncratic, oddly compelling film about a lot of cosmic issues and societal challenges as seen through the eyes of 24 people named David on three continents. Including me, filmed circa 2014. I look a bit younger.

Baril used portions of my interview as the voiceover for the film’s trailer, which should give you a sense of the film’s ambitions and tone. Also, here’s a short clip from my interview.

24 Davids (Clip #1 – David Bollier) from NFB/marketing on Vimeo.

I loved encountering the other Davids. Each of us offered our own grand speculations about the future of global civilization. Baril slyly provides a subtle emotional undertone to the film, linking a lot of different people and gritty everyday realities together. Unfortunately, I can’t find a listing of where the film is showing, but it appears that that AMC, a US theater chain, has scheduled some showings. Perhaps the film will make it to Netflix sometime.

*             *              *

Let me end by re-posting a lovely poem that Beshara magazine included at the end of my interview. David Attwooll’s “The Binding of the Moor,” is about an attempt in the nineteenth century to enclose the ancient wetland Otmoor in Oxfordshire, which led to the Otmoor Riots of 1829-1830.

We took a fine oat-sheaf, tight bound at the waist And set it on fire; and while it was burning Our Lady of Otmoor rode all round the moor-edge Until the great sheaf was just ash on the ground.

Her shining cloak circled the land that was Common And granted forever to us local people For kypeing of fish, for eel scuttles of osier And fowling and keeping allotments of geese.

Many hundred’s year later, the gentry’s men came And bound her with fences, and drained her with ditches. They built mighty banks and stopped up the Ray. They enclosed all our birthright and forced us all out.

So men blackened their faces and wore women’s cloaks And ventured at night with hatchets and billhooks And tore down the bindings. On the sixth of September All in broad daylight, a thousand folk walked

Seven miles round the moorland, past all seven towns Pulling down fences in spite of the Riot Act. Sixty-six of us they arrested that day And carted us off to the City for trial.

When we reached Oxford it was St Giles Fair Where the holiday mob freed all of us prisoners. We won the day, but the moor stayed a patchwork: A hundred years passed ’til the bindings were loosed.

When the waters came home and the chessboard dissolved They planned the M40 to drive through her middle: Over three thousand people bought one-foot square parcels Of Alice’s Meadow to stop them at last.

The only road now is a path full of puddles, The Roman road’s agger is a scatter of stones. The moor’s safe – for now – and free to the people And the bright cloak of water is home to the birds.

The post Some Recent Interviews about the Commons appeared first on P2P Foundation.

We’re talking about a different mental register of paradigm for understanding the world. For so long, we’ve had this presumption of fiction that the homo economicus, the utility maximizing individual, is the chief agent in the way to see the world. The commons says there is a different way to see humanity—not simply as a notional ideal, but as a practical operational system and there’s countless examples out there.

This audio interview (and transcript) with our colleague David Bollier was conducted by Adam Simpson and originally published by The Next System Project.

David Bollier joins us this week to discuss “the commons” and what such a concept means for social transformation. You can read more about David’s ideas in his paper for the NewSystems: Possibilities and Proposals series, and also read more of his work at www.Bollier.org.

Interview transcript

Adam Simpson: Welcome back to The Next System Podcast. I’m your host, Adam Simpson, joined today by self-described commons activist and director of the Reinventing the Commons Program at the Schumacher Center for a New Economics, David Bollier. David is the author of Think Like a Commoner: A Short Introduction to the Life of the Commons. He’s also the editor of From Bitcoin to Burning Man and Beyond with John Clippinger, as well as Patterns of Commoning, and The Wealth of the Commons with Silke Helfrich.

Wouldn’t you know it, David is here to talk to me today about the concept of the commons. David, welcome to The Next System Podcast.

David Bollier: It’s great to be here.

Adam Simpson: Great. Well, before we get into the concept of the commons, David, I wanted to ask you: How did you first come to learn about this concept, what made you embrace it, what really drew you to this kind of work that you do?

David Bollier: Well, in the 1970s and 80s when I was working for Ralph Nader, all of my friends were fighting what I would now call enclosures of the commons, meaning privatization and commodification of things like federally funded research, public lands and the air waves, which are used by broadcasters for free and so forth. All these were being taken private, but we really didn’t have a language for talking about this. It wasn’t until the late 1990s and early 2000s when I encountered the work of Elinor Ostrom, a great scholar of the commons and I realized that the commons was a great way to describe how things get done outside of the market and the state, meaning through self-organized activities and self-governance to manage projects that create things of value. I realized this at a time when neoliberal capitalism and its policies were getting worse and worse.

It was essentially colonizing and taking over all of these commons in our life. Not only the resources that belong to us, but our ability to self-manage them for our benefit. They were basically appropriated by the corporate world for global trade and turned into private property.

I realized that the commons had great potential as an alternative political vision that is not some unified movement or ideology, like in the past, but something that is locally distributed and grounded in things that people love and want to protect. So, the commons is about sharing those things that belong to all of us that we want to protect in our ability to manage them for our purposes.

Adam Simpson: Right. It seems like you started with intellectual property as a way of thinking about the commons, and not, say, the management of environmental resources?

David Bollier: Well, that was actually, you might say the proximate cause, because in the late 90s you may recall the world wide web had just gone live in 1991, and here was a system that encouraged automatic sharing, yet copyright was being asserted to prevent us from sharing…

Adam Simpson: This was the time of Napster…

David Bollier: Yes, it was the time of Napster; it was the time of the emergence of open source software, and then a few years later, of the blogosphere and many other innovations. All innovations in which value and creativity was based on sharing and collaboration, something that conventional economics and markets don’t understand because they want to create things that are artificially scarce and individually ownable, as opposed to something that’s shared.

Copyright was a very important force for me in bringing into focus that we needed to protect our commons, and in fact, I helped co-create the group called Public Knowledge. It’s a Washington advocacy group to protect the knowledge commons: on Internet and telecommunications policy, it’s trying to protect shareable information.

Adam Simpson: Yeah. It reminds me that one of my first interactions with this space would have been the late Aaron Schwartz and his work on public knowledge.

David Bollier: A real pioneer. I mean, there was a whole movement that has ebbed and flowed, but Larry Lessig, when he established Creative Commons licenses to allow legal sharing of content, that was a huge innovation. It provided a legal infrastructure for people to share. You have to remember, copyright was based on any little scribble or a guitar riff being born as private property. There was no way for stuff to be legally shared, so everything was implicitly piracy if you simply imitated or used somebody else’s work. Creative Commons licenses were an enormous innovation that did what Congress or federal authorities would not do, which is to legalize sharing.

Adam Simpson:  I heard you imply a critical take on Elinor Ostrom’s work when you said that she focused on the commons in terms of resources, could you elucidate what you meant?

David Bollier: Let’s first introduce Elinor Ostrom. I mean she was a Indiana University political scientist who, over the course of 30 or 40 years, from the 1970s until her death in 2012, studied lots of natural resource-based commons: forests, fisheries, farm land, irrigation water, etc. She showed that contrary to the whole “tragedy of the commons” fable that Garret Hardin proposed in a famous 1968 essay, people can and do self-organize to sustainably manage resources. Her life’s work was, first of all, studying that on the ground level and then creatively theorizing to explain how and why that occurs. Well, she, as a woman working in the male-dominated economics professions, saw that social relationships mattered in creating things of economic value. That was a lot of what her work was about. But, at the end the day, she’s working within a rational economic framework as opposed to a cultural or social framework.

In some ways, she was providing an interesting counterpoint to the conventional economic theories. In other ways, she was still working within, what you might call, the ontological framework: the premises of our human relationships, rationality, and behavior. The very dominant theme then was the prisoner’s dilemma in which people supposedly are always trying to calculatedly maximize their personal gain, which of course happens but it’s not the full story of what humanity is about.

I think that there are other dimensions of our propensity to give, to collaborate, to share, to be part of something larger than ourselves, which is arguably non-rational and haven’t had been adequately conceptualized within economics. The commons helps to deal with that.

Adam Simpson: Part of the intervention of the commons, it seems to me, is a cultural shift as well because in the prevailing context of capitalism and neoliberalism, it makes sense for people to try to maximize their outcomes, but in the framework of the commons, it doesn’t make sense to put this kind of personal gain at the forefront.

David Bollier: Well, let’s just say nobody wants to be a sucker in being taken advantage of. So if the prevailing system is ‘get all that you can for yourself,’ you are a sucker if you just give it away. However, if you can develop a sufficient critical mass with protectable boundaries around your shared resources and generative capacity the way open source software does, the way a lot of local systems do, the way countless different commons do, you can create a different paradigm that is—I think—more humanly satisfying, that benefits more people without the gross inequality and exploitation that occurs now, and that is more ecologically benign because it doesn’t have the growth imperative that capitalism has. So you can start to reintegrate people with each other and with natural systems.

We’re talking about a different mental register of paradigm for understanding the world. For so long, we’ve had this presumption of fiction that the homo economicus, the utility maximizing individual, is the chief agent in the way to see the world. The commons says there is a different way to see humanity—not simply as a notional ideal, but as a practical operational system and there’s countless examples out there.

Adam Simpson: On the notion of rational economic man, it seems to me that with a fairly rudimentary knowledge of anthropology one would see numerous examples of commons. I don’t know, this seems fundamentally a question about human nature: homo economicus and “rational economic man” versus a kind of collaborative creature that I think most social scientists understand humans to be.

David Bollier: Well, first of all, I’m dubious about saying there is some essentialist human nature. Having said that, evolutionary scientists are showing that our propensity to cooperate seems to be in-born even though, of course, we’re quite capable of competitive and quite awful things as well. But part of it, it comes down to what the culture validates and nourishes or what it allows to become the cultural norm. We, of course, within capitalism know what those norms are. But in some ways, we do have more capacity to create these alternatives worlds in making them sustainably not just as some fantasy or a cult or isolated community. We can see this in many different domains from natural resources to urban spaces to digital spaces.

I think it’s important to understand that this is a cross-sectoral/cross-cultural paradigm that can give us a way out of some of our very profound problems today.

Adam Simpson: A key concept in this conversation within this framework of the commons is the notion of property and ownership. I wanted to ask how does our current system of property and ownership fail us and how is the paradigm of the commons different?

David Bollier: Well, property law tends to privilege the whole idea of individual exclusive control, and it presumes that that is the only way to go, even though individual property ownership tends to deny the realities of our social connection to each other and our embeddedness in ecosystems. In other words, it denies relationality as the basis of human life because it focuses mostly on simply market exchange of objectified things that have been put inside an envelope of property.  So for instance, you have snippets of music sampling defined as appropriations of private property. It’s been taken to such extremes that all sorts of knowledge, like the breast cancer susceptibility gene, can be privately owned, nano-matter is being patented, and it goes on and on.

Basically, there is, of course, an important role for private property, but so much private property is, in fact, corporate property.  This is consequential for the natural ecosystem, because it’s gotten out of control. This dominion of private property is reaching extremes, with various cascading environmental problems and climate change happening as capitalism tries to propertize everything in the world.

The commons is an attempt to assert, “No, there need to be limits to private property and some things need to be collectively managed for the collective good and not simply leveraged as much as possible for market gain.”

Adam Simpson: I mean, this is exactly my next question: the question of commodification and enclosure. I heard, earlier today, that the human genome is 20% patented. What would you say are the consequences and the implications of this kind of continuous enclosure, this commodification of everything? What does it mean for our society?

David Bollier: Well, we’re living through it right now: it means grotesque inequality, with many shared common needs not being met. This is, in the large part, driven by the private propertization and marketization of everything. I mean, even social problems themselves are marketized. We have to create new kinds of property rights, for example, pollution rights, in order to tackle pollution. Or we need to financialize incentives to deal with nature, like let’s monetize how much pollination bees do for crops. Let’s put a market value on that and create a market security that can be traded as a way to solve the problems of bees disappearing.

In other words, it’s grotesquely out of control. We are trying to use property and market incentives to deal with precisely the problems these structures and incentives have created in the first place. Can we start to acknowledge the intrinsic value of nature instead? There are things that are outside of the market that should remain inalienable and not be propertized. I think this is one of the pre-eminent concerns of our time, but paradoxically even progressives and liberals who are tied to the market growth grand narrative can’t go there, because they see the only way to solve problems is further growth, further growth, further growth, and that’s something that we have to step up to and deal with.

Adam Simpson: Related to the question of growth—you suggest that continuous growth is one the maxims of our system. We can’t even have a stable or a steady-state economy, as it’s called. We have to always keep growing. How might an advocate of the commons understand the concept of economic growth or the steady state or de-growth, as some people call it?

David Bollier: Well, capital is driving this because capital wants more and more return and things that are un-owned—not yet propertized—are ripe resources for the market machine. A commoner would say, “How can we create things that are simply not for sale?”

I think we need to cultivate this ethic that many things are not for sale and devise either the legal or technological or social norms to prevent that from happening. We have to realize that the growth paradigm is no longer the tool for improved civilization in human betterment. It’s becoming destructive of those very things, yet capital insists that that’s the only way forward.

We have to have a reckoning on that, and it’s not simply going to happen at the macro level first, we have to cultivate that at the micro level where we live: in our own medium of productive needs.

That’s what the commons can do: meet needs in decommodified ways, where you don’t need to have market exchange. Your needs and what the market wants are different things entirely.

Adam Simpson: Related to the question of growth is the question of value; our market centered system depends on the enormous amount of ‘externalities’ that go unaccounted for. How does the concepts of the commons inform your understanding of value?

David Bollier: Well, market economics regards anything that can be exchanged and it has a price as being valuable. The commons regards all sorts of things that don’t have a price as also being valuable, but that doesn’t have any standing within the conventional political or economic discourse. For example, the value of rivers, lakes, oceans as natural systems of wildlife, species and genes as natural systems; the value of care work that work women and family, and unfortunately very few men are involved in. All of these are non-market phenomena unless they’re turned into something for sale. The whole notion of the economy which focuses on exchange value needs to start to focus on use value, meaning what’s valuable for us to use whether or not it has a price, whether or not money is exchange to make it happen.

The commons is about encouraging use value not as mediated by price or supply and demand, but by social need in negotiation, in coordination, and that’s a different proposition than the market.

Adam Simpson: You mentioned care work; I want to follow-up on that because that appeared in quite a few different passages of different works of yours I’ve read. As you mentioned, the market interpretation of care work would be that it is a service that is either bought or sold or traded, etcetera. As you stated, I’d like to reemphasize that whether we’re talking about child care or elder care, this is mostly done by women. It’s mostly unpaid and when it is unpaid, it’s mostly done by women. I want to know how the idea of care work fits into the framework of the commons.

David Bollier: Well, it is a major sector of non-market life that is regarded as external to the economy, and because it’s external to the economy and it’s therefore not productive, it’s not valuable in any price sense or a return on investment sense. Some ingenious people have been able to turn care work—elder care, child care or household activities—into a market. Suddenly, it’s valuable. The problem is that’s inconsistent with the very notion of care which cannot be regimented. You can’t put a price on what real care is about because care involves sacrificing of yourself. You’re not maximizing your utility; you’re giving of yourself to someone else. You’re spending a lot of time with them in ways that are not productive or creating value in a market sense.

There is an inherent contradiction involved in marketizing care work. Care work creates a problem for economics in the sense that we obviously know that care is essential to a human civilization. In a society, somebody needs to raise and enculturate the children, somebody needs to educate them, old people need to be taken care of. But the problem is that it doesn’t fit within market categories and economics doesn’t quite know how to deal with it—but of course it has to be done.

That’s a theoretical limitation of conventional economics. It doesn’t want to go there because there’s no exchange value going on, so I think the ambition should be to integrate the commons into our notion of the economy so that the reproduction of life, families, households has stand-in in economic analysis as opposed to, “Oh, if not being paid for, it’s not worth anything.”

Adam Simpson: I want to move on to the possibilities that the commons unlocks. I’ve read about the commons being used to support programs ranging from a basic income, to environmental protectionism or even, I think, Peter Barnes’ combination of the two with a cap and dividend program around carbon emissions. Are there examples you would highlight that you come your mind immediately as the kind of political, economic and, or social programs that are unlocked through a more detailed understanding of the common?

David Bollier: Well, this is a frontier right now because the conventional state is so allied with markets and capital as the only way to get things done that it doesn’t consider the commons as something worth pursuing. It doesn’t generate tax revenue, or at least not as much tax revenue as market growth does, so the state is either indifferent or uncomprehending of the commons.

That said, there are a handful of interesting experiments that are trying to use state power to support the commons. You mentioned Peter Barnes, things like the Alaska Permanent Fund in which the state legislature created a trust to take revenues from state oil sales, put it in a trust fund owned by every resident in Alaska and every year, residents of Alaska get between $1,000 and $2,000 from that fund. Even people like Sarah Palin support it.

Well, the state could create trust funds for natural resources that we all own: groundwater, forests, minerals. This would be one way to protect them from simply being exploited by rip-and-run companies, so that the public could get some benefit from them and steward them so they’re not simply leaving ecological destruction in their wake.

That’s one interesting model. There’s others. In Europe, there’s a lot of cities that are developing so-called “public-commons partnerships,” where the city government is collaborating with self-organized neighborhood groups or other initiatives to facilitate them doing work that bureaucracies would otherwise do. It’s a great advance because the citizens care about their neighborhood, they want it to work, they can devise their own systems that are not legalistic or bureaucratic or come with lots of high overhead. It’s really a way to get people re-engaged with the city, and for governments to support genuine citizen participation. Another example might be participatory budgeting where people can have a direct say in how budgets are allocated.

There are some of these things but, frankly, this is more of a frontier that is now being explored as commons grow and start to bump up against conventional systems, market systems, bureaucratic systems.

Adam Simpson: I wanted to ask specifically about the notion of finance and money. In a lot of ways, money is a public utility that we use to lubricate exchanges, but money is something that’s really not controlled publicly as a utility in the current system, although there are experiments like with alternative currencies and things like that. How does the monetary system fit into the framework of the commons?

David Bollier: Well, people don’t realize that 95% of the money in the United States is created privately through banks. They give out loans and that creates new money. They don’t necessarily have a significant amount of money in the bank. Their loan creates the money, and they then reap the gains of that through interest payments all the time. Essentially, the US government has surrendered its prerogative as a sovereign state. It has surrendered the power to create money to private banks—and all the profits from that are privately capitalized and controlled.

This means that we, the people of the United States, don’t reap the benefits of that power to create money. This is called the power of ‘seigniorage.’ Well, could we capture some of that value ourselves by having the government or its designated trustees create money rather than banks? We saw, for example, how the government used that power to bail out the banks in 2008: it essentially created money to bail them out without it being considered public debt that needed to be repaid. That’s only because the government has that power: the state has that power.

Why can’t we have quantitative easing for the environment or social needs without it being considered public debt that needs to be repaid? We could do that responsibly so long as the money is sapped up through taxes so that we don’t create inflation. Mary Miller, a British monetary specialist has written about this in a book called Debt or Democracy? The point is, these alternative ways of creating money are entirely feasible and responsible as opposed to simply surrendering that power to private entities to reap all the gains.

Adam Simpson: Of course, sovereign fiat currency issuers have the power to create money in such a way and right now, we let private banks do it. Are you compelled by the notion of publicly owned banks or other institutions that might have another way of generating this for the people?

David Bollier: Well, public banks would be a huge improvement as well—because instead of a city or state governments having to borrow money from private banks at their exorbitant interest rates, they could radically lower their interest cost. For example, in creating major infrastructure, they could save a quarter, a third or more of the cost by having their own bank. A city, if it were to open its own public bank, deposit city funds in it, and then make loans, could save lots in infrastructure.

Ellen Brown of the Public Banking Institute is the leading expert on this. A lot of states and localities are now exploring public banks as a way to throw off the yoke of dependency on private banking. It’s entirely feasible.

Adam Simpson: Right. Now, I want to talk about the theory of change here. In your model’s paper, I believe it’s called Commoning as a Socially Transformative Paradigm, you mentioned that some parts of the left that rely on top down notions of theories of change like “if we get this elected office or enough people in this legislative body, we can affect change.” What do you think that these pathways that rely on the notion of taking political power, what do you think they get wrong about the theory of change?

David Bollier: Well, I think that as those top down approaches become autonomous onto themselves, they lose connection with the people they’re trying to serve—the way the Democratic Party has, for example, and they become a self-replicating political elite. Moreover, they lose sight of the fact that simply taking power is a dead letter if you can’t prevail on a transformative agenda or have the will power and imagination to do so. We saw how the left took over power in Greece in how it was pointless because they were trumped by international capital.

Even as a sovereign nation, they could not deal with their debt crisis because the international banks were saying, “Too bad, we hold all the trump cards.” I saw the same thing in Bolivia where Ivan Morales took power from the left as an indigenous person. He essentially had to retain the extractivist economy that had existed before because of their dependence on international capital and markets.

If we’re talking about being transformative, simply taking power through the state is maybe necessarily but is quite insufficient. It’s not going to be transformative unless it’s really organically connected to local change and local change has a different political and cultural logic. In other words, it doesn’t want to simply placate or accommodate or even support international capital.

I think that the seeds of change have to come from the bottom and that when they do, they will express a different political culture through people’s personal and social practices. That has to be origins at this point because the rest of the system is too indentured: too tied up with the existing logic of the system, and so we need some external forces to intervene because within the logic of the existing system it is just is not going to happen.

Adam Simpson: You talk about not just the commons, but the verb commoning. I was hoping to get you to elaborate on how commoning represent an effective theory of change and if there are some examples of commoning that you might refer people to.

David Bollier: I’m very suspicious of novel words being our salvation, and we’ve seen the lifecycle of the word sustainability, for example, where it’s now meaningless because everybody is sustainable. The point is what’s happening that’s achieving the goal of that word? The truth of the matter is there is no such thing as a common as such, there is commoning: the social practices of talking, negotiating, working it out for shared goals, bringing diverse perspectives into alignment. This is the processing of commoning, and this is a form of democratic empowerment and governance that can happen right now without permission from the government or the corporations. We can do it ourselves in lots of arenas.

Commoning, you might say, is the seedbed of a new democratic practice. Well, Peter Linebaugh, great historian of the commons says there is no commons without commoning, and I think that’s a way to keep the vitality and aliveness of the commons. In fact, it’s the only to keep it alive because if you’re simply mouthing the word as a buzzword or marketing or messaging strategy, it’s dead right then. You have to have a community of people who have the commitment, the activity and it has to be constantly recreated.

To put it in high flown words this is the relational theory of value. The value is created through people enacting their relationships together through commons, so that’s where I think really transformative change is going to come from. It needs that grounding in people’s lives, in local practice.

Adam Simpson: Thank you, so that was actually my last question. I think it’s a great place to end actually, but is there anything you’d want to add for our listeners about the subject of the commons or about your work?

David Bollier: Well, we didn’t discuss so much the broad range of things going on but I would just say, first of all, there’s lot of people that are, you might say, commoning and don’t even know it. The value of the commons language and vocabulary is it helps validate something that they might consider trivial, marginal, not consequential. But it is, and I think that’s part of the importance of the language of the commons, especially as a counterpoint to the market narratives that are seen as the only legitimate, the only productive way of producing things.

Second, I would point out that there are lots of projects in different domains. I mentioned the city as commons, lots of digital projects from open source software to Wikipedia and dozens of Wikis to open access scholarly publishing and it goes on and on, which are forms of commoning that are incredibly productive, creative arguably more so than the proprietary versions.

I just wanted to say that there is a broad variety of social activities that are commoning right now, so this is not some utopian abstract thing, it’s happening; it’s practical whether it’s recognized culturally as commons: as a different form of value generation. That’s precisely what a lot of the commons movement is all about: validating this as an important activity that needs to be protected and extended.

I would just leave it at that and what people know that there is a lot of resources out there. I can direct them to my website blog which Bollier.org, but there’s other important ones like the Peer-to-Peer Foundation, which has a lot of stuff on peer production, open design, and manufacturing. You can go to the Commons Transition website, and then in Europe there’s quite a few different sites, if you have more specialized interest, for instance in Barcelona, which is in the vanguard of a lot of activities around the commons.

I just wanted to end with the notion that this happening, even if it’s not being culturally recognized—at least in America.

Adam Simpson: Well, to our listeners, thank you for listening this week and, David, thanks so much for joining us.

David Bollier: Thank you.

The post Social Transformation Through ‘The Commons’ with David Bollier appeared first on P2P Foundation.

Introduction

The US economy’s deep systemic inequalities of income, wealth, power, and opportunity are part of global inequality trends, but US-style capitalism and public policy make inequalities more acute. Their observable and felt harm to our civic and economic life is corroborated by research from many disciplines. Yet, by the same token, moving toward a more egalitarian society would realign most aspects of economic and social life for the better. So how can we bring these changes about?

For starters, we must know what we are up against. These inequalities do not spring mainly from technological change and globalization, though both compound and complicate the rift. Instead, imbalances of power and agency embedded in our political and economic system are the main drivers and accelerators of inequality.

Reducing inequality requires a “next systems” analysis and playbook. Here, we briefly examine our current inequality predicament and show how these inequalities undermine our democracy, economic stability, social cohesion, and other cherished values. We then explore the systemic causes, perpetuators, and superchargers of inequalities and, finally, evaluate policy interventions and pressure points for leveling them.

The path through this thicket is only partly uncharted. The United States can learn from other advanced industrial countries with significantly less inequality, adapting policies and practices to US needs and circumstances. We can also learn from our own history—from understanding that our rigged rules have been racially biased—to how we dramatically reduced inequality between 1940 and 1975.

That said, part of the path is uncharted. Grappling with climate change and other breached ecological boundaries—whether ocean acidification, fresh water contamination, or methane dumping—intensifies the challenges of reducing extreme inequality. And many of the New Deal and post-World War II policies that reduced inequality for earlier generations won’t work now given today’s levels of population, resource consumption, and ecological risk.

Together, the extent and widely felt effects of inequality challenge us to put a fine-tuned combination of historical insights, policy innovations, best practices, and fresh thinking to the test. Just as urgently, we also need a vision of a more equal and opportunity-rich society.

• Download a short overview of key takeaways
• Download the executive summary
• Download the full report

Further resources: 

How We Can Transition to a Bottom Up Economy – Chuck Collins, YES! Magazine

Original source: The Next System Project 

Photo by Fazik93

The post Reversing inequality: Unleashing the transformative potential of an equitable economy appeared first on P2P Foundation.

David Bollier, in his paper for our “New Systems: Possibilities and Proposals” series exploring viable political-economic alternatives to the present order, suggests that a commons-based framework could provide a critical template for de-commodification, mutualization, and the organization and control of resources outside of the market.

We’re excited to share with you our latest animation that illustrates some of the principal features of David Bollier’s vision for how we can manage the commons cooperatively and fairly—through “commoning,” a process of social self-organization that creates new and innovative ways to equitably and sustainably manage shared resources.

Read David Bollier’s essay “Commoning as a Transformative Social Paradigm” from Volume 2 of our New Systems: Possibilities and Proposals series.

The post How Does The Commons Work? Our new animation elaborates on David Bollier’s next system appeared first on P2P Foundation.

From the shownotes to the video:

In the video above, produced by Democracy Collaborative staff working with Softbox Films, I sketch the major institutions of a systemic alternative based in plural forms of democratic ownership, oriented around community at various scales—what I have called “The Pluralist Commonwealth.” Read on below for an article highlighting six strategic places to help make this systemic vision a reality, as well as an annotated transcript of the film’s narration with links to key resources. And be sure to visit pluralistcommonwealth.org for an archive of material diving deeper into various aspects of the model.

Six ways to build the pluralist commonwealth…

Many years ago—and especially while researching the history of the U.S. decision to use atomic weapons on the people of Japan—I came to understand that there was something deep at work in the American political and economic system driving it toward relentless expansion and a dangerous informal imperialism.

Could we imagine a system that undercuts the logic responsible for so much suffering at home and abroad?

It was reflections like these that brought me to first sketch the idea of a “pluralist commonwealth” in 1972—an economic and political system different from both corporate capitalism and state socialism grounded in democratic ownership, decentralization, and community.

While progress is never strictly linear, I believe that we are beginning to see an accelerating development of the foundations for a system that looks a lot like the Pluralist Commonwealth, and a growing recognition of how they begin to fit together. Here are six areas where it’s particularly strategic to be organizing and building institutional power in the current moment…

Read my article in Yes! Magazine on these six strategies

Annotated Video Transcript

America’s economic system has been generating massive wealth for those at the top while the rest of the nation faces stagnant income, explosive debt, mass incarceration, and the deterioration of our cities. The system also produces global warming and endless war.

How might we create a system that instead produces sustainability, democracy, peace? Fundamentally, it means changing who owns the country. If we can democratize wealth in a society where the richest 20 Americans alone control more wealth than the bottom half combined, we can democratize political power.

One design for a next system—what I call the Pluralist Commonwealth—helps clarify what we want, and how we get there. It takes a plural approach to building different forms of common wealth. Taken together, such forms create a practical, decentralized mosaic of a democratic economy to transform and displace the predatory, extractive elements of the current system.

Cooperatives, for example, are economic alternatives to top-down corporate workplaces. They address community needs instead of maximizing profits, and they bring democracy both to decision making and to the ownership of wealth. A hundred-and-thirty-million Americans are already involved in one or another kind of cooperative, and 10 million people work at employee-owned companies.

Some cities have also begun linking worker-owned firms together in community-building strategies. Such linked businesses can also provide goods and services to nonprofit institutions with billions of dollars in revenues, like hospitals, universities, and local governments. Unlike corporations, such institutions don’t pick up and leave, and this creates stable demand, helping stabilize worker-owned companies.

Such cities are engaged in a very decentralized form of economic planning. Planning, often controlled by corporations, is common in every advanced economy, but who makes the decision, how transparently, and for what aims, are key questions of system design. Planning starting at the level of the community keeps money circulating locally and ensures more stability. The Pluralist Commonwealth envisions joint ventures between community and worker groups and regional enterprises to handle larger-scale economic matters. Such publicly accountable institutions can eventually displace large corporations.

Participatory budgeting is another tool. It allows community members to vote on taxpayer-funded proposals. It also opens the way to thinking about participatory regional and national planning that one day could guide public investment in transportation, technology, and many other larger industries.

The Pluralist Commonwealth also includes nonprofit credit unions, community-development financial institutions, and city and state public banks that invest where private banks often won’t. Such an infrastructure can help build toward regional and national public-banking alternatives to Wall Street, banks capable of supporting regional plans, offsetting recessions, and averting financial crises and bailouts.

Taken together, the Pluralist Commonwealth creates interconnected structures, which, in the course of daily functioning, foster democratic, egalitarian, and ecological values. Companies that don’t grow endlessly means fewer carbon emissions or resource scrambles. Democratizing wealth ownership amplifies the voices of ordinary people in electoral politics. Planning allows people to allocate time and work more democratically, freeing up time for community involvement.

Step by step, the plural institutions of the Pluralist Commonwealth aim to transform America from the ground up, creating democratic foundations for a world that’s not threatened by climate change, inequality, and militarism. Building out from the communities to the state, regional, and ultimately the national level, the Pluralist Commonwealth envisions a decentralized and democratic country—and a sustainable planet for generations to come.

System Crisis, System Change: A Talk with Gar Alperovitz

Thanks to our friends from Share the World’s Resources for the heads-up.

The post The Next System Project’s Pluralist Commonwealth appeared first on P2P Foundation.

For those of you have been following the commons for a while, my essay will have a lot of familiar material.  But I also came to some new realizations about language and the commons, and why the special discourse about commoning and enclosures is so important. I won’t reproduce the entire essay – you can find it here as a pdf download or as a webpage at the Next System Project – but below I excerpt the opening paragraphs; the section on the discourse of the commons; and the conclusion.

Introduction

In facing up to the many profound crises of our time, we face a conundrum that has no easy resolution: how are we to imagine and build a radically different system while living within the constraints of an incumbent system that aggressively resists transformational change? Our challenge is not just articulating attractive alternatives, but identifying credible strategies for actualizing them.

I believe the commons—at once a paradigm, a discourse, an ethic, and a set of social practices—holds great promise in transcending this conundrum. More than a political philosophy or policy agenda, the commons is an active, living process. It is less a noun than a verb because it is primarily about the social practices of commoning—acts of mutual support, conflict, negotiation, communication and experimentation that are needed to create systems to manage shared resources. This process blends production (self provisioning), governance, culture, and personal interests into one integrated system.

This essay provides a brisk overview of the commons, commoning, and their great potential in helping build a new society. I will explain the theory of change that animates many commoners, especially as they attempt to tame capitalist markets, become stewards of natural systems, and mutualize the benefits of shared resources. The following pages describe a commons-based critique of the neoliberal economy and polity; a vision of how the commons can bring about a more ecologically sustainable, humane society; the major economic and political changes that commoners seek; and the principal means for pursuing them.

Finally, I will look speculatively at some implications of a commons-centric society for the market/state alliance that now constitutes “the system.” How would a world of commons provisioning and governance change the polity? How could it address the interconnected pathologies of relentless economic growth, concentrated corporate power, consumerism, unsustainable debt, and cascading ecological destruction?

Why the Discourse of the Commons Matters

The language of the commons is, first, an instrument for reorienting people’s perceptions and understanding. It helps name and illuminate the realities of market enclosure and the value of commoning. Without the commons language, these two social realities remain culturally invisible or at least marginalized—and therefore politically inconsequential.

Commons discourse provides a way to make moral and political claims that conventional policy discourse prefers to ignore or suppress. Using the concepts and logic of the commons helps bring into being a new cohort of commoners who can recognize their mutual affinities and shared agenda. They can more readily assert their own sovereign values and priorities in systemic terms. More than an intellectual nicety, the coherent philosophical narrative of the commons helps prevent capital from playing one interest off against another: nature verse labor, labor verse consumers, consumers verse the community. Through the language and experiences of commoning, people can begin to move beyond the constrictive social roles of “employee” and “consumer,” and live more integrated lives as whole human beings. Instead of succumbing to the divide-and-conquer tactics that capital deploys to neutralize demands for change, the language of the commons provides a holistic vision that helps diverse victims of market abuse recognize their shared victimization, develop a new narrative, cultivate new links of solidarity and—one can hope—build a constellation of working alternatives driven by a different logic.

The potential of the commons discourse in effecting change should not be underestimated. I see the darkly brilliant counterexample of cost-benefit analysis discourse, which American industry in the 1980s succeeded in making the default methodology for environmental, health, and safety regulation. This gambit neutered a set of social, ethical and environmental policies by grafting onto them the language of market economics and quantification. The discourse effectively eclipsed many elements of statutory law and changed the overall perception of regulation. I see the commons discourse as a similar kind of epistemological intervention: a systemic way to reclaim social, ecological, and ethical values for managing our shared wealth.

As the foregoing discussion implies, the commons movement seeks to change our very conception of “the economy.” Rather than consider “the market” as an autonomous, “natural” realm of society that somehow exists apart from the Earth’s natural systems and our social needs, commoners seek to integrate the social, ecological, and economic. Karl Polanyi, in his landmark book The Great Transformation, explained how market culture in the seventeenth through nineteenth centuries gradually supplanted kinship, custom, religion, morality, and community to become the primary ordering principle of society.[7] That transformation must be reversed; unfettered capital and markets must be re-embedded in society and made answerable to it. We must make capital investment, finance, production, corporate power, international trade, and so on, subordinate to societal needs.

Along with allied movements, the commons movement seeks to develop institutions and norms for a post-capitalist, post-growth order. This means confronting the monoculture of market-based options with a richer, more vibrant sense of human possibilities than those offered by the producer/consumer dyad. The book that I recently edited with Silke Helfrich, Patterns of Commoning, profiles several dozen fascinating, successful commons that draw upon different human capacities and social forms. These include community forests, local currencies, Fab Labs, municipal water committees, farmland trusts for supporting local family farming, indigenous “biocultural heritage” areas for stewarding biodiversity, permaculture farming, “omni-commons” structures that provide administrative/ legal support to commons-based enterprises, and many others.

Such mutualized systems of provisioning must be developed and extended. They represent socially and ecologically benign alternatives to the debt-driven economy catering to unquenchable market demand. (A brief side note: legal and organizational forms are no guarantee for breaking the logic of capitalism—one need only look at the decline of many co-ops into quasi-corporatism and managerialism. Still, such forms can provide the potential for moving to more benign forms of consumption, if not post-consumerist social mores.)

Conclusion

Because the commons movement is a pulsating, living network of commoners around the world, it is difficult to set forth a clear blueprint or predict the future. The future paradigm can only arise through an evolutionary co-creation. Still, we can already see the expansive, self-replicating power of the commons idea as it is embraced by highly diverse groups: Francophone commoners in eight countries, who hosted a two-week commons festival in October 2015 with more than 300 events; urban activists who are reconceptualizing the “city as a commons”; Croatians fighting enclosures of their public spaces and coastal lands; Greeks developing a “Mediterranean imaginary” of the commons to fight neoliberal economic policies; indigenous peoples defending their ethnobotanical and biocultural traditions; digital activists mobilizing to devise new forms of “platform cooperativism”; and so on. The commons language and framework helps develop unexpected new synergies and forms of solidarity.

As a meta-discourse that has core principles but porous boundaries, the commons has the capacity to speak at once to the worlds of politics, governance, economics, and culture. Importantly, it can also speak to the alienation associated with modernity and people’s instinctive needs for human connection and meaning, something that neither the state nor the market, as they are now constituted, can do. The commons paradigm offers a deep philosophical critique of neoliberal economics, with hundreds of functioning examples that are increasingly converging. But as an action-oriented approach to system change, everything will depend upon the ongoing energy and imagination of commoners, and would-be commoners, to develop this globally-networked living system.

The anonymous Invisible Committee in France has observed that “an insurrection is not like a plague or forest fire—a linear process which spreads from place to place after an initial spark. It takes the shape of music, whose focal points, though dispersed in time and space, succeed in imposing the rhythms of their own vibrations.” That describes the unfolding odyssey of the commons movement, whose rhythms are producing a lot of resonance.

Cross-posted from Bollier.org

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Over 500 people signed up for the webinar, testimony to the growing level of interest in understanding the evolving next economy ecosystem, its players, their interrelationships, their theories of change, principles, values, and practices. These issues form the core focus of REL’s current metamapping of the next economy world.

Moderated by Gus Speth, Co-chair of the Next System Project the webinar featured a panel discussion involving Jules Peck of REL, Michel Bauwens of the P2P Foundation, Ferananda Ibarra of  VillageLab / Metacurrency Project, Michelle Mascarenhas-Swan of Movement Generation, and Ed Whitfield from the Fund for Democratic Communities.

Jules Peck opened by presenting the purpose of the Real Economy Lab: to build understanding and awareness of alternative ways of running and designing a next economy, and to be a facilitator and connector of next economy change-agents, connecting the dots and creating the conditions for convergence across the next economy ecosystem.

Peck and his colleague Benjamin Brownell explained that at the heart of REL’s online platform is an evolving, innovative, highly visual and interactive network map of the evolving next economy ecosystem. You can view Brownell’s overview of the mapping process and visualization outcomes here. A Kumu video walk-through which illustrates the power of this ecosystem mapping can be found here:

This next economy ecosystem is far from simple. It involves representing the activity and relationships among a rich array of organizations, innovations and experiments encompassing the caring economy, the sharing economy, the provisioning economy, the restorative economy, the regenerative economy, the sustaining economy, the collaborative economy, the solidarity economy, the steady-state economy, the gift economy, the resilient economy, the participatory economy, the new economy, and the many, many organizations engaged in related activities.

REL has been surveying the landscape and identifying the linkages between these diverse initiatives and aims to provide an interactive platform where the cumulative knowledge, aims, and resources of these movements can be drawn together in order to seek common ground and drive coordinated action.

The discussion among the panelists explored the value of mapping the next system:

• What are the leading and recurring challenges in organizing more coherent effort and coalition building within and across this movement? What are the obstacles and challenges that arise?
• What do we, as the constituent parts of a potential movement for a next economy, have in common? What principles, values and alternative economic paradigms motivate our actions, and where are we ultimately aligned? How do we talk about this more openly?
• How can people and organizations build on one another’s efforts and collaboratively work towards a more capable, credible, and coherent movement for systemic change? What are leading theories of change?
• Where are we seeing inspiring or illustrative success stories and convergence underway in the movement? How can we measure progress and promote positive outcomes?
• How might we improve the odds of success? How might REL better support practitioners and thinkers in the next economy world? What tools, data, or support are missing from the system we all work in?

Ed Whitfield, a longstanding campaigner for rights and livelihoods, talked about putting resources back under democratic control. Asked how the Southern Reparations Loan Fund intends to change the economy, he explained that it creates non-extractive funding structures and gets them into the hands of those who need them. Whitfield emphasized the crucial need for next economy players to network and collaborate and the valuable role of tools like the REL metamaps.

Greensboro’s Renaissance Community Cooperative is one of the first projects backed by the Southern Reparations Loan Fund

Michelle Mascarenhas-Swan from Movement Generation and the Our Power campaign spoke about the right to have access to the resources necessary for productive, dignified and sustainable livelihoods. Securing this right, according to Mascarenhas-Swan, will require all of taking action toward a ‘just transition,’ creating the local living economies that this right depends on.

Mascarenhas-Swan emphasized the need to “restore the muscles of collectivism” to change the rules of the extractive economy and of initiatives in places like California where community groups like @APEN4EJ are orchestrating large resource shifts to move us toward a new economy built on community control. Mascarenhas-Swan added that we need to recognise the root causes of problems that appear “on the surface” but that require a clear vision of democratic economic alternatives in frontline communities around the world.

The Our Power Campaign is building grassroots coalitions for a just transition in places like Richmond, California

Ferananda Ibarra (@fer_ananda) spoke passionately of the crucial role of mapping in collective intelligence and of tracing the patterns behind past moments of transformation in a “new expressive capacity,” a harmonization of value systems and the economic means for enacting them. According to Ibarra, we all need to go beyond just managing resources, and work instead to  create a “regenerative ecosystem.”

Michel Bauwens spoke about the explosion of experimentation and innovation in the commons and p2p space and the risks that the ‘extractive’ economy represents to such developments. He spoke of the need to knit together different fragmented next economy models such as the commons, open-coops, sharing, and solidarity economy movements. Ecosystemic thinking is also needed. In a given locality, new economic institutions like timebanks and food coops should be connected and working together. For Bauwens, New Zealand’s Enspiral.org serves as a powerful example of this kind of mutual support.  He also spoke of the need for new funding models to help make this sort of work possible.

The Enspiral Network supports and connects a number of innovative efforts in social enterprise software development.

Jules Peck finished the webinar with a call to all those interested in these issues to engage with the work of REL. As with any open-source, open-access resource, the metamapping REL is producing will only be as strong as the data inputted by participants in the next economy space to the mapping process.

Please suggest the names and contacts of organizations that should be included in the metamapping work to REL via email at team@realeconomylab.org.

Organizations wishing to complete the metamap survey themselves should feel free to do so at this link in order to be included in REL’s next round of metamapping, projected to cover up to 250 next economy initiatives around the world.  REL also welcomes other thoughts and feedback via email.

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