Throwing Rocks at the Google Bus: How Growth Became the Enemy of Prosperity (27 page)

The preeminence of capital—its ability to elect leaders, dictate law, and reward itself—was a predictable outcome of the industrial age. Global expeditions, big machines, and centralized production were much more dependent on capital than the small businesses and local craftspeople that preceded them were.

Moreover, of the three factors of production, only money is unbound. Well, centrally issued debt-based currency is unbound. Capital is unbound, and must be, because it has to be able to grow infinitely in order for interest to continue to be paid up to its issuers. That’s why capitalists advocate open markets, free trade, and minimal regulations. They are intolerant of anything that would serve as a boundary to the unfettered movement and growth of capital.

Labor and land, on the other hand, are bound. That’s why they are shunned as obstacles to market growth. Communities impede the free market by objecting to the construction of a factory or power plant within their boundaries. “Not in my backyard” is interpreted as a selfish stance, because any local environmental destruction pales in comparison to the wider, universal benefits to the marketplace. Labor unions, for their part, which try to create a bound cohort of workers, are derided as anticompetitive and exclusionary. Labor should instead be sourced from anywhere,
at any price the market will bear. By breaking the boundaries around a particular labor group or region of people, business is free to grow.

But no matter how the market might treat them, both people and places are still bound. There’s only so much land to develop. People can put in only so many hours before they drop. Despite that, the market attempts to treat these fixed factors as unbound. Why should a factory worry about the land on which it pollutes? There’s always some other place to go. There are still plenty of nice trees and clean water in Washington state or Canada. There’s always China or Africa for toxic landfill. At least those countries are getting paid to take the waste. There are thousands of miles of unused land on planet Earth; it may as well be infinite. The same for labor: if the people in this town or state won’t work for less money, then the people in that state or country will. There are billions of people on the planet. The available labor these people can offer may as well be unbound, too—or so that faulty logic goes.

Digital industrialism seeks to push people and places to their unbound extremes. Amazon Mechanical Turk unbinds laborers from time, place, and one another. Without physicality, the worker has no way of expressing bounds or forging connections. The platform limits side-to-side conversation; there’s no chat function. Meanwhile, the net further minimizes the particularity of place—whether it’s local merchants providing physical showrooms for customers who later order online, or social networks encouraging us to think of our community as a nonlocal assortment of connected profiles. In such an environment, the value of labor and land becomes, at best, discounted.

Bounded investing is more like running a family business: you’re in it forever, because it’s the legacy your kids will inherit as well as the place they will likely spend their careers. If your son returns from college unable to find a job, you hire him to work in the company. This lets you spend the same dollars twice: supporting him and getting a worker who knows the business and cares about his inheritance. The business is your home.

Unbounded investing, on the other hand, promotes the don’t-poop-where-you-eat philosophy of business, limits the number of times the
same dollar ricochets through an economy, and depends on the illusion of an infinitely expanding marketplace. When we adopt even a partially bounded strategy, the money we spend comes back to us time and time again and the investments we make are reflected in the real world in which we live. You want a sustainable economy? Recycle money.

3. Run Your Business as a Commons: Platform Cooperatives

Resistance to digital industrialism may look like communism, but it’s better understood as a simple reinstatement of the commons. Most of us became familiar with the commons in its modern form—projects like Wikipedia or Lawrence Lessig’s Creative Commons, essentially gift economies in which people participate together for a greater good. In these two cases, the information on Wikipedia and the music, writing, or code assigned a Creative Commons license are assumed to belong to everyone and no one. Nobody owns them, and everyone can share them within the limits set by mutually agreed-upon rules. I may quote Wikipedia in this book as long as I credit the source.

The commons were originally a set of lands in England owned by the Catholic Church and open to local farmers for grazing. There were strict sets of rules about how much land one could graze and how often, which kept the commons capable of sustaining everyone’s flocks in a fair fashion. After King Henry VIII rejected the authority of the pope, those common lands became privatized, or “enclosed.”
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Over the next couple of centuries, the myth of the “tragedy of the commons” was employed to bring the remaining common lands under private control.

The premise that economists and early agricultural investors put forth was that if no one owns something, there’s no one to protect it. So common lands will supposedly get overgrazed, and common fisheries will run out of fish. Never mind that there’s no evidence of either happening in the maintained commons of England. The supposed tragedy became an accepted truth taught in basic economics courses, and as easy to prove as the condition of most public restrooms in the United States. As recently as 1968, ecologist Garrett Hardin convinced the remaining holdouts of
the tragedy of the commons by arguing that Darwinian selection favors privatization by the strong, and that if the world’s land is not privatized, the results would be “horrifying.” In his words, “injustice is preferable to total ruin.”
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The false assumption is that people are incapable of recognizing the value of their shared resources and then organizing to protect them—and in doing so, create great value for everyone involved. There are hundreds of examples of highly functioning commons around the world today. Some have been around for centuries, others have risen in response to economic and environmental crises, and still others have been inspired by the distributive bias of digital networks. From the seed-sharing commons of India to the Potato Park of Peru, indigenous populations have been maintaining their lands and managing biodiversity through a highly articulated set of rules about sharing and preservation. From informal rationing of parking spaces in Boston to Richard Stallman’s General Public License (GPL) for software, new commons are serving to reinstate the value of land and labor, as well as the ability of people to manage them better than markets can.

In the 1990s, Elinor Ostrom, the American political scientist most responsible for reviving serious thought about commoning, studied what specifically makes a commons successful. She concluded that a commons must have an evolving set of rules about access and usage and that it must have a way of punishing transgressions. It must also respect the particular character of the resource being managed and the people who have worked with that resource the longest. Managing a fixed supply of minerals is different from managing a replenishing supply of timber. Finally, size and place matter. It’s easier for a town to manage its water supply than for the planet to establish water-sharing rules.
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In short, a commons must be bound by people, place, and rules. Contrary to prevailing wisdom, it’s not an anything-goes race to the bottom. It is simply a recognition of boundaries and limits. It’s pooled, multifaceted investment in pursuit of sustainable production. It is also an affront to the limitless expansion sought by pure capital. If anything, the notion
of a commons’ becoming “enclosed” by privatization is a misnomer: privatizing a commons breaks the boundaries that protected its land and labor from pure market forces.

For instance, the open-source seed-sharing networks of India promote biodiversity and fertilizer-free practices among farmers who can’t afford Western pesticides.
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They have sustained themselves over many generations by developing and adhering to a complex set of rules about how seed species are preserved, as well as how to mix crops on soil to recycle its nutrients over centuries of growing. Today, they are in battle with corporations claiming patents on these heirloom seeds and indigenous plants. So it’s not the seed commons that have been enclosed by the market at all; rather, the many-generations-old boundaries have been penetrated and dissolved by disingenuously argued free-market principles.

On the brighter side, the peer-to-peer nature of so much of our digital activity has led to a revival of commons and commons-inspired activity. The Open Source Ecology project is a collective of engineers, machinists, and designers who have spent the past ten years developing and refining farming and industrial machinery according to open-source principles. The group publishes its schematics freely online, for anyone worldwide to download, build, or improve.
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These machines cost a fraction of their standard retail counterparts.
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OSE believes that corporate profits, exaggerated by abuses in intellectual property law, create an artificial scarcity for such products that is damaging to all but those at the top of the corporate pyramid and that an information commons can correct the imbalance. “The end point of our practical development is Distributive Enterprise—an open, collaborative enterprise that publishes all of its strategic, business, organizational, enterprise information—so that others could learn and thereby truly accelerate innovation by annihilating all forms of competitive waste.”
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The most ambitious commons-inspired project to date, the Ecuadoran government’s “Free, Libre, Open Knowledge” program, or FLOK, seeks to transform the entire nation from its current extractive, oil-based economy to one based on a protected commons of both real and digital resources.
Under these policies (still in development), intellectual property would be considered part of the commons. This would lead to the creation of hyperlocal factories, schools, and labs, freed from the constraints of licensing fees. So the thinking goes, this would then allow companies to operate with greater fairness, efficiency, and sustainability. The FLOK project originates with a specific set of Latin-American socioeconomic concerns. Foremost among these is “biopiracy,” the practice of industrial agricultural companies such as Monsanto, which patent organic technology developed over centuries by local and indigenous farmers. Here in the United States, we can find an analogue in the practice of tech giants such as Apple or Google, that rely on the open-source commons for many of their products’ architectures, profiting without paying back into the digital commons. In response to these challenges, FLOK proposes the development of peer-production licenses under which only commoners, cooperatives, and nonprofits would enjoy free usage of intellectual property bounded by the commons; corporations would have to pay.
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At first glance, the so-called “sharing economy” appears to be based in these commons principles. At least in some superficial way, this is true. We have gone from buying music on records or CDs to downloading MP3 files to simply subscribing to Pandora or Spotify. Owning music—or a car, for that matter—is becoming less important than having
access
to it. This is certainly a step on the path from hoarding to sharing. Except the many sharing platforms and services are not sharing at all but renting. We don’t collectively own the vehicles of Zipcar any more than we collectively own Spotify’s catalogue of music. And as private companies induce us to become sharers, we contribute our own cars, creativity, and couches to a sharing economy that is more extractive than it is circulatory. Our investments of time, place, and materials are exploited by those who have invested money and actually own the platforms.

Now that we can see it, however, we can also envision the alternative: we join and form businesses that value our real investments of effort, stuff, and community resources. Imagine an Amazon owned by the sellers, an Uber owned by the drivers, or a Facebook owned by the people whose data
and attention is being bought and sold. Distributed digital technology makes this not only possible but preferable to the locked-down, overprogrammed, and extractive platform monopolies of today. It’s a lot easier and more efficient just to make something work than to make it also eliminate all potential competition in the process. Such applications and companies would be designed not to promote unbounded expansion into all possible horizontals and verticals but simply to sustain its member/worker/owners and their relationships with their customers. By establishing such limits on expectations, these companies are no longer obligated to return hundreds or thousands of times the capital invested. There is no exit, nor should there be.

Could people develop platforms without the venture capital of the current startup scene? Between BitTorrent, Wikipedia, and Bitcoin, we’ve seen them do it already. And luckily, venture capital has already funded the development of Amazon, Uber, Airbnb, and dozens of other fat platforms that can easily be cloned and deployed in better ways. Yes, there may still be some costs in maintaining servers—but there won’t need to be legions of investors behind that basic infrastructure, demanding that a majority of the revenue be extracted from the system.

Instead, we get a new, powerful, and highly accessible version of the kinds of worker-owned collectives that are providing jobs and profits to people in recession-torn Europe and have been for decades. Although their activity is essentially off the radar of Wall Street, they stand as a powerful proof of concept for a digitally empowered, worker-owned business landscape.

For example, in stark contrast to the business bankruptcies and unemployment plaguing Italy as of this writing, in the Emilia Romagna region a full 30 percent of GDP is created by a bounded network of independent, employee-owned firms constituting just 10 percent of the population.
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Ranging from manufacturing, construction, finance, artisans, even to social service organizations, the firms coalesce into “flexible manufacturing networks” that cooperate on specific projects, quickly pooling labor and resources, then disbanding as necessary. It’s essentially a
bounded network of worker-owned businesses that source from one another instead of seeking the lowest bidder or attempting to expand into an additional horizontal. Valuing sustainability over growth, the businesses remain small but also agile enough to retool if market conditions change and networked enough to get support if they need to pivot.