Related: diary
Oct-13-2008:
Starting on some of HPL.HP.com/personal/Hans_Boehm/c++mm
Oct-05-2008:
Economics is efficient when use value trumps profit.
Many will say "without profit, who will invest?".
My answer is: Some consumers already want to invest, but are unsure where to "put their money".
If WE The People could have our basic needs such as water, food/drug/soap, cloth, shelter/housing/storage, sanitation/sewer/recycle,
A community work center
governed through spoken and written language enforced
won’t go away
to monetize the immaterial
4th October 2008
crisis of value
capture value
failure of extensive development
intensive development
capital is incapable of realizing returns on ownership
growing discrepancy between the direct creation of use value
but only a fraction of that value can actually be captured by business and money
crisis of accumulation of capital
Furthermore, we lack a mechanism for the existing institutional world to re-fund what it receives from the social world. So on top of all of that, we have a crisis of social reproduction: peer production is collectively sustainable, but not individually.
Thus, there are two simultaneous crises: first, the failure of artificial abundance through subsidized inputs and externalization of cost, endless supplies of natural resources for appropriation (aided by state favortism), and the availability of new markets as outlets for surplus capital and output;
and second, the failure of artificial scarcity in the cognitive realm. Taken together, this means that while markets and private ownership of physical capital will persist, “the core logic of the emerging experience economy, operating as it does in the world of non-rival exchange, is unlikely to have capitalism as its core logic.”
Johan Soderberg relates this crisis of realization under state capitalism to capital’s growing dependence on the state to capture value from social production and redistribute it to private corporate owners. This takes the form both of “intellectual property” law, as well as direct subsidies from the taxpayer to the corporate economy. He compares, specifically, the way photocopiers were monitored in the old USSR to protect the power of elites in that country, to the way the means of digital reproduction are monitored in this country to protect corporate power. [Hacking Capitalism, pp. 144-145.] James O’Connor’s theme, of the ever-expanding portion of the operating expenses of capital which come from the state, is also relevant here. [The Fiscal Crisis of the State] The important point is that this strategy of shifting the burden of realization onto the state is untenable. The proliferation of bittorrent and episodes like the DeCSS uprising have shown that “intellectual property” is ultimately unenforceable. The RIAA’s shakedown operation can be circumvented by the simple expedients of encryption and proxy servers. And as we have already seen, in an economy of subsidized inputs, the demand for such inputs grows exponentially, faster than the state can meet them. The state capitalist system will reach a point at which, thanks to the collapse of the portion of value comprised of rents on artificial property, the base of taxable value is imploding at the very time big business most needs subsidies to stay afloat.
In another article, in which he develops these themes at greater length, Bauwens writes that capitalism’s successor system is likely to have a significant role for markets, but that the two structural presuppositions of existing capitalism–artificial abundance of resources and artificial scarcity of information–will be replaced by the reverse.
We live in a political economy that has it exactly backwards. We believe that our natural world is infinite, and therefore that we can have an economic system based on infinite growth. But since the material world is finite, it is based on pseudo-abundance.
And then we believe that we should introduce artificial scarcities in the world of immaterial production, impeding the free flow of culture and social innovation, which is based on free cooperation, by creating the obstacle of permissions and intellectual property rents protected by the state.
What we need instead is a political economy based on a true notion of scarcity in the material realm, and a realization of abundance in the immaterial realm.
In the purely immaterial realm, the services of capital are becoming increasingly superfluous, as described by Michael Hardt and Antonio Negri:
…the cooperative aspect of immaterial labor is not imposed or organized from the outside, as it was in previous forms of labor, but rather, cooperation is completely immanent to the laboring activity itself. This fact calls into question the old notion (common to classical and Marxian political economics) by which labor power is conceived as “variable capital,” that is, a force that is activated and made coherent only by capital…. Brains and bodies still need others to produce value, but the others they need are not necessarily provided by capital and its capacities to organize production. Today productivity, wealth, and the creation of social surpluses take the form of cooperative interactivity through linguistic, communicational, and affective networks. [Michael Hardt and Antonio Negri, Empire (Cambridge and London: Harvard University Press, 2000), p. 294.]
In addition, capitalism faces a crisis of realization in another regard that Bauwens does not directly address. For over two centuries, as Immanuel Wallerstein observed, the system of capitalist production based on wage labor has depended on the ability to externalize many of its reproduction functions on the non-monetized informal and household economies, and on organic social institutions like the family which were outside the cash nexus.
Historically, capital has relied upon its superior bargaining power to set the boundary between the money and social economies to its own advantage. The household and informal economies have been allowed to function to the extent that they bear reproduction costs that would otherwise have to be internalized in wages; but they have been suppressed (as in the Enclosures) when they threaten to increase in size and importance to the point of offering a basis for independence from wage labor. “
This entry was posted on Saturday, October 4th, 2008 at 8:10 am and is filed under Cognitive Capitalism, P2P Economics, P2P Theory, Peer Production. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.
2 Responses to “The consistent failure to monetize the immaterial economy won’t go away”
1. Jo Says:
October 4th, 2008 at 8:53 pm
Can someone connect this to the bailout?
2. Michel Bauwens Says:
October 5th, 2008 at 6:15 am
There is a link: for the last 30 years, the bulk of the value is immaterial, and it cannot be measured in any good way by the current monetary system, hence the wild gyrations as the market forces vainly try to estimate the ‘value’. The enormous suplus in money floating around, is constantly searching to create speculative bubbles, mostly based on inflated estimatios of such immaterial value.