The following is a second excerpt from a really interesting PhD thesis that interprets and critiques Rifkin with the assistance of other macro-historical thinkers:

* PhD Thesis: Making Sense of Rifkin’s Third Industrial Revolution: Towards a Collaborative Age. McAllum, Michael J C. Thesis submitted to The University of the Sunshine Coast. Under the supervision of Dr. Sohail Inayatullah & Dr. Marcus Bussey. Submitted: June 7, 2016

* Situating the Post Capitalist Proposition

Michael McAllum writes:

Rifkin, in his latest work The , extends his earlier argument that capitalism will move from a vertical to lateral orientation to assert:

[T]he Capitalist era is passing and although the indicators are still soft and largely anecdotal, the Collaborative Commons is ascendant and by 2050 it will most likely settle in as the primary arbiter of economic life.

He contends there are essentially three reasons for this.

Firstly, with the use of network technologies the capitalist system is increasingly able to produce constructs of simplification and efficiency (competitive advantage) that enable near zero marginal cost and “if that were to happen the lifeblood of capitalism [margins] would dry up”6. This proposition suggests that this drive for competitive advantage is inherent in the system and, as each new advantage is obtained, the margins available reduce. Logically, this will reach a point when there is no margin left and the system is at its limits. When that occurs, then the only option is to expand the market into areas of what were considered societal responsibilities (e.g. prisons, health, security) 700 until the same point in the process occurs again.

Secondly, the entropic bill for industrial capitalism has arrived, because the economic model and its related energy system see environmental effects as unaccountable externalities. Consequently, the energy systems on which capitalism depends must rapidly change if Collapse is to be averted, thus “throwing the whole economic model into question”.

Thirdly, Rifkin proposes the emerging Collaborative economy is developing as a viable, perhaps even preferred, alternative to a capitalist model that is, by design, systemically inequitable.

While some of Rifkin’s propositions are still evolving, a prime concern of this thesis (as has been stated) is to determine if there is also a contemporary body of literature that supports his fundamental proposition that the system is at is limits. An exploration of Rifkin and Transformist contentions is important because an understanding of the outcomes (not proof!) to these propositions has implications for mentality, philosophy and narratives of engagement with a global community who currently do not see any viable alternative to a mythology that argues (in a rephrasing of a Churchillian quote on democracy) “as a system, capitalism is not perfect but it is far better than the alternatives”. However, it should be noted that, to date, the use of ‘alternative’ has always been contained within the boundaries of the contemporary discourse (capitalism v socialism). ‘Alternative’ as it is used here describes a transformational imperative, one that stands outside of contemporariness because either the system is at immanent limits, or a better option is in prospect.

* The Post Capitalist Option

As Rifkin’s articulation of his current (evolutionary) understanding of post capitalism architecture has been detailed earlier in this thesis, what remains unresolved is the support that it has. Two issues in particular serve as useful points of reference for considering this support: changes in the dynamics of economic and power relationships, and a repurposing of markets from accumulation to exchange.

Rifkin contends that a reconstitution of the relationships between the actors is central to the post capitalist proposition of how value is created and captured. In post capitalist literature there is explicit support for the proposition that in the current market accumulation model the emphasis is hierarchical, one of control of labour and capital, whereas in the post capitalist system the emphasis is on participation and sharing. This is what Rifkin terms privileging of collaboration over competition. Kostakis and Bauwens describe it as “a model where the relations of production will not be in contradiction with the evolution of the mode of production”. This is now possible because network technologies enable socio-technological arrangements that are not only able to compete (and often outperform), in terms of transaction costs with hierarchical entities, but by design they create a framework for social as well as personal benefit.

The explicit rejection of the mechanistic model permits the development of relationship webs that are unconstrained by previous modes of control as “there is a structural connection between the key defining properties of commons-based peer production and the possibility of engagement in creative, autonomous, benevolent and public spirited undertakings”. The viability of such networks also provides for the development of alternatives for those Dussel describes as they who are not.

It allows:

…an internal exodus by which the autonomous production of social life is made increasingly possible (with non cooperation with the dominant capitalist model) and an outer movement that can muster resistance and strike at the heart of power.

This different arrangement also reconfigures the investor-producer-consumer relationship; what Rifkin terms prosumers. These are either citizens or consumers who have an active role in more than one aspect of the value creation process (hence prosumer) whereas typically, involvement has been only at the point of purchase. Depending on the nature of the value creation process this relationship may focus on how work is done (as exemplified in 3D printing), where and how consumers can give as well as receive (evident in smart grid power production), or in decision making (e.g. by investing and then buying particular types of music they like). It is also encouraging a radical rethink in how services like health are delivered. “The consequence is a new decentralisation of organisation whose base will, in chosen and spontaneous groups, fulfil certain functions and whose membership will be overlapping and not exclusive”. The attractiveness of the ‘prosumer’ archetype is near-zero information sharing costs; little fixed cost prior to production; the ability to customise rather than prototype; no waste, ‘just in time’ production; and the development of relationships that encourage innovation. In essence it is a disruptive logic that redefines value creation in ways that privilege economies of one over scale; can be conceptualised as a ‘space of flows’ across a multitude of public good and private interactions; and distributes control among the actors in a manner that encourages collaboration rather than advantage. Finally, the significance of this technology-relationship congruence in a post capitalist model is that it provides a platform, consistent with Rifkin’s theorising, through which critical environmental, social and economic issues might be addressed.

One of the dearly held mythologies of the capitalist model is that the market is a neutral, non-value driven ‘invisible hand.’ Proponents of markets for exchange, not accumulation, differ. They argue current markets are capricious, ownership-centric and exhibit all the system tensions described above. Instead they propose new models of cooperation (microfinance, co-operative infrastructure, decentralised energy) that operate in pseudomorphic-like arrangements within the existing system as prototypes of market commons. These Commons, manifestations of lateral power, are potentially spaces that “provide opportunities for virtuous behaviour, ones that are more relevant to virtuous individuals and (therefore) the practice of effective virtuous behaviour may lead to more people adopting these virtues as their own”. These are, as Wallenstein suggests, one of the alternatives for a world in a period of structural chaos. They point to a future where the rights of the group, as well as those of the individual, are a permanent feature of society. This evolution of post capitalism is not simply the adaptive evolution of capitalism as propounded by Kaletsky, Picketty and Bryjolfsson, and one that Rifkin in earlier works termed distributed capitalism. Rather, it represents a systemic break, an acceptance that the model has little adaptive capacity left. It makes available through access models what previously could only be owned, be that physical property or knowledge. What emerges, Mason describes as “new forms of society that (through networks) prefigure what comes next”, and Rifkin characterises as ‘ zero marginal cost society’ that can take the human race from an economy of scarcity to an economy of abundance over the course of the first half of the twenty-first century”.

* Conditions for success of a Post-Capitalist Transformation

However, using a macrohistorical framing, this thesis has deconstructed Rifkin’s narratives into seven theories using CLA as a framework for that deconstruction. It asserts that each of these theories, acting in ways that reinforce the others, provides a logical and coherent, but linear, narrative. It also suggests that these theories (of limits, discontinuous change, stages of history, empathic consciousness, leadership, post capitalism and transformation) explore layers of reality that, while concentrating the gaze on the near future, require consideration of reality that is ‘beyond the litany’ of that gaze. It is postulated that these considerations reveal a range of challenges and tensions that significantly impact both the transition and transformation Rifkin is proposing.

These include the following:

o The entropic effects (the environmental crisis) of the industrial economy cannot be resolved inside an economic system that privileges ‘growth’ and ‘quantity of life’ as prime drivers of society.

o New energy and communication technologies, acting as ‘infrastructure’, are nomothetic in their nature and influence. As such, they challenge the continuation of mechanism and vertical power, and they privilege post-carbon futures, ecological thinking and collaboration.

o At the core of the (theory of) revolution is a reconception of time, form and space that will have three effects. The first is a contest between competing senses of reality in the short term (mechanism v collaboration). The second is to actualise the design of transformed social, economic and institutional fabric so that it does not recreate the issues that created the ‘crisis of limits’ in the first place. The third will include in that design an accommodation and acceptance of multiple senses of time in a way that no one sense of time is more important than any other, but also in a way that any given sense of time does not imperialise itself at the expense of these others.

o If a shift in the nature of empathic consciousness is fundamental to the success of both transition and transformation—that is, from a psychological (individualistic) sense to a planetary level—then it needs to be complemented by philosophical approaches that are ‘beyond the horizon’ of modernity: a way of thinking that does not put the Western episteme, nor the role of humans as masters-of-nature, at the center of the discourse. This reconstitution of identity requires a rethinking of ‘presence’ or being-ness.

Given these challenges, the success of any transition and transformation will consequently be conditional on three dynamics: new kinds of leadership; a different economic model; and the speed of transition.


o As a result of the shift from vertical to lateral power, leadership will necessarily become distributed in scope, and both networked and collaborative in nature (a new cosmopolitanism that can be localised). By definition it will privilege partnership over dominator models, and because of the nature of partnership, it will have many forms.

o The future will require the development of ‘post-capitalist’ economic models that replace a contemporary system that cannot either confront the (unsustainable) limits it has created, nor the consequences of zero margins that many technologies now enable. This will see markets of accumulation replaced with ‘post-growth’ markets of exchange; self-reliant models developing in a revitalised civic sector; and ownership models giving way to ‘access and use’ models.

o The success, though, of this transition will be conditional on its speed. If it fails to occur in a timely fashion, the entropic effects will rapidly overwhelm whatever progress has been made towards a new Collaborative Age.

Rifkin’s Third Industrial Revolution is therefore conditional. It is an argument that, whilst focused on the near-term future, is binary in its options (Transform or Collapse). Consequently, one of the benefits of placing this narrative within the wider macrohistorical discourse has been to identify other possibilities that might be between, or even outside of, the spectrum Rifkin describes.”

More and fuller excerpts here.

Photo by Donald Lee Pardue

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