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Mutualist Blog: Free Market Anti-Capitalism

To dissolve, submerge, and cause to disappear the political or governmental system in the economic system by reducing, simplifying, decentralizing and suppressing, one after another, all the wheels of this great machine, which is called the Government or the State. --Proudhon, General Idea of the Revolution

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Location: Northwest Arkansas, United States

Thursday, September 07, 2006

Michel Bauwens: An Economy Organized on P2P Principles

Two items. The first, a post at P2P Blog, is an overview of the various forms of peer governance.

In the second (which sheds considerable light on the categories briefly listed in the previous item), Bauwens is interviewed at length by Richard Poynder. I've excerpted some of the most important sections, from my perspective:

RP: There was back then a view that the Web — and the rash of dotcom companies — would force traditional companies to reinvent themselves or perish wasn’t there?

MB: Sure, but it became clear to me that attempts to graft the Internet and the Web onto the corporate world had largely failed — as evidenced by the dotcom crash.

It was also clear that the belief that change would come from corporations — as envisaged by the stakeholder concept of the late seventies — had also proved wrong. Finally, it occurred to me that all the social and ecological indicators were moving in the wrong direction.

RP: How do you mean?

MB: I could see that despite the dotcom crash, the social dynamism of the Internet had not died, but had simply continued in the social sphere, in civil society. At the same time, corporations had become worse places to work in than they had ever been, and poverty and environmental destruction was growing at an unprecedented scale.

* * *

RP: So what are the implications of this P2P dynamic in terms of enabling the social and political changes that you want to see?

MB: The P2P phenomenon gives rise to three new social processes: peer production (which is best explained by Yochai Benkler in his book The Wealth of Networks); peer governance (i.e. how these groups manage themselves) and peer property (i.e. commonly-owned property).

RP: What is it that is new and distinctive about these three new social processes?

MB: Well, the interesting thing about peer production is that while it is embedded in the market, it is managed by neither pricing nor corporate hierarchies. As Benkler points out, it has therefore introduced a third mode of production, one organised by neither markets nor the state.

Similarly, non-hierarchical governance represents a third mode of governance, one based on civil society rather than on representational democracy; in other words, non-representational democracy.

Finally, P2P gives rise to non-exclusionary property forms. These are based on both free and open access, and they seek to prevent the private appropriation of commonly produced work arising from peer production.

* * *

RP: On your web site you say that the general principles behind movements like Open Source software and Open Access provide models that can be used in "other areas of social and productive life". Does this include material production in any way?

MB: Sure. While these principles naturally apply to any form of immaterial production, we believe they also have relevance in the sphere of physical production. After all, although physical production requires large amounts of capital, the manufacturing process also includes an immaterial design phase.

RP: So while physical products like, say, washing machines and television sets, will always need to be sold at a price that reflects the cost of the raw material and the labour that went into producing them, the knowledge about how to produce and design them should be made freely available for anyone to make us of?

MB: That's right. Essentially, P2P expands democracy from the political sphere, to all spheres of life. I would add that P2P's strength is that, as a mode of production, it is more efficient than the for-profit and state-centralised modes in many areas of production.

The other point to make is that in many cases the capital (be it financial or industrial) required to produce material products will also be distributed, and so P2P principles can be applied in the distribution of capital too.

RP: Can you explain that?

MB: I mean that it would be wrong to think that material production will not be affected by the P2P paradigm, so we need methods whereby, instead of having one or several large investors, or shareholders interested in short-term profit, capital can be obtained in distributed ways, from the producing communities and their customers themselves for instance.

That means that we need 'distributed capital'. The UK-based Limited Liability Partnerships and other Open Capital schemes could be a step in that direction for instance. User-built networks and P2P-exchange projects like Prosper and Zopa also point in that direction.


Anonymous Anonymous said...

But this would never work! P2P is all about downloading questionable pictures, music, and warez with spyware in them from kazaa! That kind of thing would be terrible if implemented in real life.

September 07, 2006 10:54 PM  
Blogger Kevin Carson said...

When the last of our manufacturing base moves to China, the entire economy will consist of "downloading questionable pictures, music, and warez with spyware in them from kazaa"--and selling used stuff on Ebay.

September 07, 2006 11:21 PM  
Anonymous Anonymous said...

It seems that given current trends, the future U.S. economy will consist largely of payments for services and payments for intellectual property. And in some cases it's hard to tell where one ends and the other begins.

For instance, as far as I can tell, it seems that Kazaa itself makes money largely because their code is not open source. So that's a weak form of intellectual property right there.

September 08, 2006 12:20 AM  
Anonymous Anonymous said...

Poverty is down, not up. The environment is better, not worse. Manufacturing employment is down, but there are still as many people working in manufacturing today as in 1950. Because of efficiency increases, they make more with less, which is why the prices you pay for food, clothing, and entertainment are so much lower.

P2P may be a better form of organisation, but almost every lament in this thread is absolute crap.

- Josh

September 08, 2006 2:02 AM  
Anonymous Anonymous said...


all that may be true, but given the malinvestment caused by the Fed's monetary policies, I'd hesitate to prognosticate too much on current data. We'll see what our economy looks like when the housing bubble pops and the stock market stays flat or deflates due to the changing demographics of our society (boomers, as they age and near retirement, will shift their investment strategy from high risk capital accumulation to low risk income strategies - that's going to cause a major decrease in demand for stocks, no matter how you slice it). All those high-rolling mortgage bankers, real estate agents, brokers, hedge fund managers, mutual fund managers, etc. will suddenly find themselves making significantly less or out of a job completely. Considering that in my area, 2 in 5 people work in one of those industries, the ripples through the economy should be fairly significant, as these people tend to spend lavishly not only at retail stores, but also on local services such as landscape and remodeling.

And that's not even starting to consider those poor souls who have ARMs or even worse, neg ams on their homes. The veritable rock and hard place are closing in on those people.

Over the last 10 years, our economy has shifted to a "service" economy based mostly on pyramid schemes (asset speculation). I don't think the landing is going to be soft when the real world re-asserts itself.

September 08, 2006 6:39 AM  
Anonymous Anonymous said...

He probably knows that poverty in the U.S. is up

Actually, it isn't. Compensation is being directed to benefits instead of wages.

As to the decline in progress, the simple explanation is marginal return. Moving from 90% to 98% literacy takes as much as moving from 60% to 90%. The last bits are always stubborn. Ditto things like life expectancy and infant mortality.

I think we have to acknowledge that many aspects of the environment have improved in the western countries, though I'd be curious to hear how much of that has been undone by the Bush administration policies.

I'm no Bush booster, but the factory owners aren't gleefully rubbing their hands and spewing sulphur into the atmosphere and water while the GOP runs things.

As for pollution in other countries, that's not a huge surprise: economic growth continues in much of the world. You can complain about more pollution, or you can complain about people living on a dollar a day, but you can't complain about both.

- Josh

September 09, 2006 2:25 PM  
Blogger Unknown said...

Why does the choice have to be between starving, or choking on pollution? A great many things can to be done to mimimise pollution without costing a great deal of money.

In my experience, management has a very short-sighted approach to such things. If something costs a little money up front, but will pay for itself in the long run, I find that management will not make the change.

I don't believe that factory owners are sitting in their offices "gleefully rubbing their hands and spewing sulphur into the atmosphere and water while the GOP runs things," but they place such cost pressures on their subordinates that people are not willing to go to them with ideas for improvement or report problems in the making. Such messengers usually termed troublemakers. It is simply easier to just stay quiet and not say anything. Consider Bhopal or the recent pipline debacle in Alaska. Both of these problems were warned about before they happened, but the people who tried to fix the problem were ostracized or even fired.

In addition, many managers will not allow changes to their system because they don't understand what they are doing in regards to pollution control. Since most managers are MBA's, and don't know the nuts and bolts of the work, they usually don't want to make changes to a system, even if it will save money immediately.

My brother holds several patents for a pollution control process to reduce hazardous waste. Metal-bearing hazardaus waste is very expensive to dispose of, and his process reduces the waste generated by such shops dramatically, reducing costs. The biggest obstacle to selling his product has not been convincing the people close to the job that his process will not only work but save money, it is management who doesn't know how their own systems work and don't trust their own people to evaluate the system and make changes to improve it.

September 09, 2006 6:55 PM  
Blogger Kevin Carson said...


The comment by Reisman's ghost was just a leg-pull, and I responded in kind.

But in a more serious vein, wages have been stagnant for thirty years (assuming the inflation rate isn't understated), and benefits are a mixed bag. Vacation time and other paid time off has been reduced substantially since the '70s, and fewer workers have employer-based health insurance. The increased spending on those still covered has a lot to do with drastic cost inflation even for procedures that have been around for a long time: to resurrect the "grocery insurance" analogy, they're jacking up the price of hamburger to cover the increasingly mandated price of steak.

And I suspect a lot of pollution has just been offshored to Third World countries (as Michel suggests), what with dioxin-soaked macquiladoras and chemical agribusiness and all.

And as quasibill suggests, one area of necessities that is decidedly not cheaper is housing: rent, whether to the landlord or the bank, probably eats up a larger percentage of average monthly pay than it has in decades.

September 12, 2006 10:21 PM  
Blogger Lorraine said...

Preliminary note: Please forgive my awful formatting.
I am not yet conversant in blogger.com markup
(let alone the blogger.com template language).
Also, I am dependent on the kindness of strangers
(B. and M. Gates) and the public sector (library)
for occasional access to the Internet,
so my "learning curve" for "new" "languages"
is less than satisfactory.

MB: Well, the interesting thing about peer production is that while it is embedded in the market, it is managed by neither pricing nor corporate hierarchies. As Benkler points out, it has therefore introduced a third mode of production, one organised by neither markets nor the state.

How can anything of any kind be embedded in the market without being managed by pricing,
let alone without being organized by the markets? The whole reason (unless I'm missing something)
people of conscience are
encouraged by certain faddish post-leftists to assume the market isn't going away, is because
of the empiricism versus conscience (positive vs. normative, whatever you fancy) debate.

It is a demonstrable fact of life that information does not want to be free.
This is why the the "shop bot" concept exists in implemented form while the "p2p manufacturing"
concept seems (as far as I am aware) to be still on the drawing board.
Even copyleftist software, especially of the non-subsidized and/or non-commercialized
varieties, consists largely of products for consumption by developer types, namely
assemblers, compilers, interpreters, editors, prolifers, voluminous libraries and their
voluminous docfiles, etc. I am nevertheless primarily a person of ideals rather than of
science, so I continue to hold beliefs that help me get up in the morning and persist through
one empirically depressing day after another. An example is my belief that information secretly desires
to be free, even if in violation of the laws of economics. If one wants proof-of-concept viruses
in the form of instances of information
wanting to be free, I would suggest something a little less ambitious and arguably less
requiring of professional skills and access to physical capital than implementing p2p
manufacturing. Try implementing p2p data mining.
Such a project, like the apparently-already-existing
phenomenon of free software, concerns "purely informational" goods, yet would attempt to expand
copyleftism's area of operations from "software" to "data," a distinction with perhaps a difference.
Also, the skills used to implement such a project (at this early juncture) are primarily data entry skills.
The opportunity cost (income potential in forgone "opportunities") for a data entry operator
of developed-world heritage
to volunteer her/his DE services, rather than attempt to pimp them in the market, as was
barely possible during the relatively prosperous nineties, is virtually zero, because the
market for those skills has literally vanished most places except India, and the eventual
virtual perfection of OCR and voice recognition will sooner rather than later obliterate
the "jobs created" there, at least the data entry jobs and the medical transcription jobs.
I am one such displaced American worker, and
I have already volunteered nominal amounts of DE services to the
barcode wikia project.
As a database, it is unimpressive, mainly, I want to believe, because word hasn't gotten
out to enough potential volunteers to allow "network externalities" to kick in
and make the activity somehow worthwhile.

Data entry skills are probably in most ways less esoteric
(less expensive, in an opportunity cost sense) than the hacker
skills open source software is built on; certainly less esoteric
than capital-raising (=kissing up?), process-engineering and facilities-planning
competencies required to get a p2p or another kind of manufacturing operation operational.

Barcode Wikia looks like it MIGHT be a project worth, if not some serious
support, at least a little more data input than the pittance it had gotten
last time I checked it.

Good luck with the p2p manufacturing. I am by all means in favor of this activity.
I am merely pointing out arguably more accessible (or cheaply accessible) areas of
experimentation that nevertheless appear largely untapped.

December 22, 2006 9:46 AM  

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