The other singularity: from the Great Meltdown to the Great Escape

A brilliant excerpt from the fifteenth chapter of Kevin Carson’s draft on Organisational Theory, which I will discuss in detail in daily submissions from October 2 to 5. If you can’t wait, go read it now, it’s has all the makings of a masterpiece.

In this excerpt, Kevin Carson discusses a possible counter-strategy to the collapse of the financial economy:

We’re experiencing a singularity, of sorts, in which it is becoming impossible for capital to prevent a shift in the supply of an increasing proportion of the necessities of life from mass produced goods purchased with wages, to small-scale production in the informal and household sector. The upshot is likely to be something like Vinay Gupta’s “Unplugged” movement (see below), in which the possibilities for low-cost, comfortable subsistence off the grid result in exactly the same situation, the fear of which motivated the propertied classes in carrying out the Enclosures: a situation in which the majority of the public can take wage labor or leave it, if it takes it at all, the average person works only on his own terms when he needs supplemental income for luxury goods and the like, and (even if he considers supplemental income necessary in the long run for an optimal standard of living) can afford in the short run to quit work and live off his own resources for prolonged periods of time, while negotiating for employment on the most favorable terms. It will be a society in which workers, not employers, have the greater ability to walk away from the table. It will, in short, be the kind of society Wakefield lamented in the colonial world of cheap and abundant land: a society in which labor is hard to get on any terms, and almost impossible to hire at a low enough wage to produce significant profit.

The potential for defection is heightened by the greater efficiency with which the counter-economy extracts use-value from a given amount of land or capital.

…[T]he owning classes use less efficient forms of production precisely because the state gives them preferential access to large tracts of land and subsidizes the inefficiency costs of large-scale production. Those engaged in the alternative economy, on the other hand, will be making the most intensive and efficient use of the land and capital available to them. So the balance of forces between the alternative and capitalist economy will not be anywhere near as uneven as the distribution of property might indicate.

If everyone capable of benefiting from the alternative economy participates in it, and it makes full and efficient use of the resources already available to them, eventually we’ll have a society where most of what the average person consumes is produced in a network of self-employed or worker-owned production, and the owning classes are left with large tracts of land and understaffed factories that are almost useless to them because it’s so hard to hire labor except at an unprofitable price. At that point, the correlation of forces will have shifted until the capitalists and landlords are islands in a mutualist sea–and their land and factories will be the last thing to fall, just like the U.S Embassy in Saigon.

Johan Soderberg refers to the possibility that increasing numbers of workers will “defect from the labour market” and “establish means of non-waged subsistence,” through efficient use of the waste products of capitalism. [Soderberg, p. 172.] The “freegan” lifestyle (less charitably called “dumpster diving”) is one end of a spectrum of such possibilities. At the other end is low-cost recycling and upgrading of used and discarded electronic equipment: the rapid depreciation of computers makes it possible to add RAM to a model a few years old at a small fraction of the cost of a new computer, with almost identical performance.

The central barrier to garage production of computers is the microprocessor, which can only be produced on capital equipment costing nearly a billion dollars. But reprogrammable microprocessors will eliminate that barrier, with millions of discarded chips enabling garage industry to operate entirely on recycled inputs in the same way that minimills reprocess scrap steel on a small scale wherever a market exists. In Cory Doctorow’s Themepunks, for example, a small workshop uses the chips harvested from thousands of discarded Elmo dolls.

Paul Goodman and Ivan Illich both remarked, in their unique ways, on the effect of radical monopolies in making comfortable poverty impossible. As the alternative economy undermines the ability of artificial property rights to levy tribute on access to the means of subsistence, comfortable poverty becomes increasingly feasible.

Dave Pollard, of How to Save the World blog, describes his own version of the singularity in “The Virtuous Cycles of the Gift Economy.” As people do the things they love and become better at them, it takes less and less money to live. People need to work less, and can devote the saved time not only to further developing production technique. People develop more skills, become more self-sufficient, and less dependent on store-bought commodities purchased with wages. They also invest a greater share of their productive energy in the gift economy and mutual aid, and a greater share of their time in building social capital. As a result, people on average are happier, healthier, and more responsible and competent; social problems and social costs decline, which further adds to the virtuous cycle of reduced cost and frees up more time from work. “These cycles are, of course, subversive. They threaten to undermine and starve the ‘market’ economy by freeing us, the end-customers of that economy, from the need to pay money into it.”

This undermining and starving is exactly what we discussed in Chapter Thirteen: building the structure of the new society within the shell of the old. Pollard describes, as one way of bring about major global change, “incapacitation–rendering the old order unable to function by sapping what it needs to survive.”

But suppose if, instead of waiting for the collapse of the market economy and the crumbling of the power elite, we brought about that collapse, guerrilla-style, by making information free, by making local communities energy self-sufficient, and by taking the lead in biotech away from government and corporatists (the power elite) by working collaboratively, using the Power of Many, Open Source, unconstrained by corporate allegiance, patents and ‘shareholder expectations‘?

Gupta’s short story “The Unplugged” related his vision of how such a singularity would affect life in the West.

Wealth stored as dollars was essentially a share in America’s national economy – a credit note backed by the US Government. But Buckminster Fuller showed us that wealth-as-money was a specialized subset of Wealth – the ability to sustain life.

To “get off at the top” requires millions and millions of dollars of stored wealth. Exactly how much depends on your lifestyle and rate of return, but it’s a lot of money, and it’s volatile depending on economic conditions. A crash can wipe out your capital base and leave you helpless, because all you had was shares in a machine.

So we Unpluggers found a new way to unplug: an independent life-support infrastructure and financial architecture – a society within society – which allowed anybody who wanted to “buy out” to “buy out at the bottom” rather than “buying out at the top.”

If you are willing to live as an Unplugger does, your cost to buy out is only around three months of wages for a factory worker, the price of a used car. You never need to “work” again–that is, for money which you spend to meet your basic needs.

The idea was to combine “Gandhi’s Goals” (“self-sufficiency,” or “the freedom that comes from owning your own life support system”) with “Fuller’s Methods” (the dymaxion principle of getting more with less).

In conclusion:

If this singularity will enable the producing classes in the industrialized West to defect from the wage system, in the Third World it may enable them to skip that stage of development altogether. Gupta concluded “The Unplugged” with a hint about how the principle might be applied in the Third World: “We encourage the developing world to Unplug as the ultimate form of Leapfrogging: skip hypercapitalism and anarchocapitalism and democratic socialism entirely and jump directly to Unplugging.”

Gupta envisions a corresponding singularity in the Third World, when the cost of an Internet connection, through cell phones and other mobile devices, falls low enough to be affordable by impoverished villagers. At that point, the transaction costs which hampered previous attempts at disseminating affordable intermediate technologies in the Third World, like Village Earth’s Appropriate Technology Library or Schumacher’s Intermediate Technology Development Group, will finally be overcome by digital network technology.

The question of the transition period is a real one. There is a very real possibility that the material foundations of the new decentralized economy will not be sufficiently laid down before the old economy’s system of circulation breaks down, so that many who are dependent on employment lose their means of support with nothing to take its place. How to manage the transition is far beyond the scope of this analysis. My main purpose has been, first, to show that such a transition is likely, whether we like it or not, as state capitalism reaches its limits and the technical and organizational means of withdrawing from it become available; and second, to show the likely outlines of a successor society based on the new technical and organizational means. My personal opinion, as I have already discussed in Chapter Twelve in regard to the crisis of centralization resulting from Peak Oil, is that the transition will be relatively long and stable, compared to (say) the catastrophic collapse scenarios of James Kunstler.

At any rate, the more widespread the means of subsistence in the informal and household economies, and the more local infrastructure exists for exchange and barter, the more closely the transition crisis will resemble the paper crisis envisioned by Schumacher. For someone who has avoided or paid off credit card debt, who has obtained a modest mortgage and made paying it off as quickly as possible his top priority, and who has a large and productive vegetable garden, the possibility of unemployment is scary. But it’s nowhere near as terrifying as for someone who’s currently barely making the monthly interest payments on his mortgage, and who’s cashed out all his home equity and maxed out all his credit cards buying a Wii and a big-screen TV and getting a new model car every couple years. Even for the creditors and the unemployed described by Schumacher’s questioner, having a roof over your head free and clear and a reliable source of food will reduce, to a large extent, the concrete harm from the paper collapse.

My hope, at least, is that conventional measures like GDP will suffer (if only gradually, over a generation) what appears to be a catastrophic implosion, as people simply stop buying shit, cut back on the hours of wage labor they previously worked to earn the money to pay for shit, and supply more and more of their own needs producing for themselves and exchanging with their neighbors. My hope, at the same time, is that people will be so busy producing for themselves and their neighbors, and enjoying their control over their own lives and work and consumption, that the collapse of the state capitalist economy won’t matter very much to them.

5 Comments The other singularity: from the Great Meltdown to the Great Escape

  1. Dougist

    Wow, fabulous stuff.

    There must be a correlation, unmentioned in your thoughts, between education levels and the percentage of the population able to “unplug”.

    My professional experience in large organizations, which I am retrofitting with “boy I wish i had now that before” theories from cultural anthropology, tells me that a hypothetical 75% of workers don’t have the ability for productive labor outside of large organizational support.

    To combat this, in our firm we spent a very high percentage of our total labor cost on training for skills that really should have been learned in high school or college.

    I’d further hypothesis that the percentage would increase from 75% if you looked a the population as a whole and not our self selected group.

    A tangential question would be the kind of education possessed and its correlation to the needs of an un-plugged population.

    Another interesting question then would be: if the educational elites do unplug, because they posses whatever skill is valued in the unplugged economy, what happens to the masses left behind who need them to create the structures for their productivity?


  2. Vinay Gupta

    Right now, 3 to 4 billion people, with no education in many cases, are living unplugged. They’re the never-plugged one acre farmers in the villages all over the world.

    To raise their standard of living to a level where they have good health – a simple measure – may seem impossible, but look at Kerala in India. $300 a year avg. income, 76 year life expectancy, > 99% literacy.

    Kerala is a model for the world.

    Unplugging while maintaining a western standard of living is a different ballgame entirely – the ability to generate enough wealth from a primarily agricultural lifestyle to maintain the ability to, say, buy a new car for $20,000 every 5 to 10 years is extremely non-trivial, as those who try it rapidly discover. It seems that, for now, you can be rich, or you can be stable, but nobody knows how to get us to rich-and-stable.

    Working on it, of course. Try for some ideas, and see the rest of for the bigger picture of how this might all work.

  3. Michel Bauwens

    Hi Doug,

    a corporation is a very special environment (I spent a two dozens years in them myself), not necessarily showing how real people behave in real environements that support their potential, because the corporation is structurally feudal, based on alienated labour and expropriates the result of the collective work … it’s like school, really, teachers will complain about the passivity of the students yet it is the essential thing that they learn as soon as they enter it.

    This of course does not mean that people have differential potential, as adult developmentalist would argue (see, slide 17 for a population breakdown of such levels), but the best method I think is to develop equipotential systems like we have learn to do in free software and other open innovation communities, where ‘motivation’ and the ability for autonomous work is simply not a problem.

    One may argue that these self-selected populations are not representative, but everybody has a passion and the key is to design social systems where people can self-select their passionate contribution to a whole.

  4. Kevin CarsonKevin Carson

    Thanks a lot for posting this, Michel.

    Doug, part of the problem is that the corporate economy is designed to make strategic decisions involving technology and product design so complex that only the most educated quartile can deal with them. A little over a century ago, most factory work was still directly organized by self-managed work gangs on the shop floor, under the direction of master craftsmen (the Coventry System was a sort of throwback to this). The central goal of Taylorism was to deskill the people on the shop floor, so that most of the workforce was easily replaceable unskilled labor with no ability to extract rents from their skills, and control of production was shifted upward into the white collar hierarchies.

    What Ivan Illich called the “radical monopolies” of professionals and the skilled trades are reinforced by (for example) local “safety” codes that criminalize unconventional self-built housing, which has led in turn to the skewing of research and development into building technologies most conducive to the needs of professional building contractors, and away from alternative modular DIY technologies.

    On the other hand, as Vinay has suggested in several places, the diffusion of small-scale production in the general population depends on anti-Taylorism: making technology sufficiently simple and user-friendly to be within the competence of the average person. It also depends on the radical lowering of the transaction costs of diffusing the knowledge itself, as user-friendly open-source technology libraries are compiled, as cell phone connections become cheap and ubiquitous even in much of the Fourth World, and Net connectivity is a standard part of cell phone connections.

  5. Apostolis Xekoukoulotakis

    I find the article overly optimistic. There is no reason why people that are part of the alternative economy will be making the most intensive and efficient use of the capital.
    If on the other hand, the alternative economy accepts the principle of non-exclusion , then the above statement is valid.

    Any local worker/consumer cooperative that doesnt allow other workers/consumers to join have no real need to be efficient when society is at a disarray.

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