<p class="MsoNormal" style="margin-bottom: 12pt;"><br>I may be somewhat out of step with the pace of the discussion, as I was on the road. Below is also a contribution to an earlier point by Pat, which I think didn't make it through the dismal connection I had in Ethiopa.
<br></p>I also want to briefly mention that I've been compiling a whole bunch of material around monetary reform and alternative currencies here at<br><a href="http://p2pfoundation.net/Category:Money">http://p2pfoundation.net/Category:Money
</a>. It is my personal belief that alternative currencies have been so far high treshold efforts (my own experience with a lets in brussels was rather cumbersome), and that if you are not yourself 'suffering', there is little chance that you'll abandon the main system, whatever its flaws. What we need therefore is a low treshold alternative, that first functions in the margins, finds space to grow in there, and when it proves its superiority,
i.e. by working both more easily and efficiently than the mainstream alternative, will have a chance to replace it, and not before. Clearly we are not there yet.<br><br>Yet in the margins, so much is happening.<br><br>I find Eric Harris-Braun's distinctions very useful (
<a href="http://p2pfoundation.net/Wealth_Typology">http://p2pfoundation.net/Wealth_Typology</a>). He shows us how much space there actually is in those margins: "The <a href="http://p2pfoundation.net/Wealth_Typology" title="Wealth Typology">
Wealth Typology</a>
teaches us that not all wealth can be measurable, and that not all
measurable wealth is tradeable. Only the latter is well suited for
money." And this then leads to a proposal to build wealth acknowledge systems (<a href="http://p2pfoundation.net/Wealth_Acknowledgment_Systems">http://p2pfoundation.net/Wealth_Acknowledgment_Systems</a>). The efforts of the center for the adventure economy is one such example (
<a href="http://p2pfoundation.net/Adventure_Economy">http://p2pfoundation.net/Adventure_Economy</a>), and I have tried to compile a list of projects here at<br><a href="http://p2pfoundation.net/P2P_Exchange_Infrastructure_Projects">
http://p2pfoundation.net/P2P_Exchange_Infrastructure_Projects</a>, I think Francois Rey's open exchange project (<a href="http://p2pfoundation.net/Open_Xchange">http://p2pfoundation.net/Open_Xchange</a>) covers the most ground, as it tries to combine both non-monetary and monetary polarities.
<br><br>All this points to the possibility of the direct social production of money as a goal for the future. I think the idea is to work on all fronts at the same time: 1) increase the scope of non-monetary exchange; 2) create monetary alternatives, but especially low-treshold ones that function without the interest protocol; 3) prepare the way for a macro-scale monetary reform a la Bernard Lietaer.
<br><br>A remark on the behaviour of the elite. I don't believe that any social change ever made it without the complicity of major elements from the former elite. Not because they wanted radical change, but because it pragmatically made sense. It made sense for imperial slaveholders to shift to serfdom, because it was in the end a more productive system; it made sense for feudal lords to adapt merchant-based and capitalist practices, because it made them richer. And by the way, it made little sense for the bourgeoisie to support socialism, because it only meant a loss for them. By contrast, peer-based modes of production as more productive, and any for-profit entity that adapts open and free, participatory, and commons-oriented elements in its strategy will in the end be more competitive than those who don't.
<br><br>So, while communities can create direct peer to peer forms of production, especially in the immaterial sphere, we are seeing more and more market practices that are overturning the logic of capitalism. It is no longer about producing for profit, but of using profit for social advancement. Profit becomes a means for different ends, rather than the other way around. As examples I see fair trade, a market form submitted to peer arbitrage, social-entrepreneurship (profit is used for social advancement), the rise of for-benetif structures such as the Mozilla, Apache and other foundations that create an infrastructure for peer production, and the trend towards 'blended value' approaches.
<br><br>The latter aims to overcome the 'two-pocket' approach, i.e. making money purely for profit, then spending it eventually through philanthropy. Here, an attempt is made to 'blend the two', and to create capital for social purposes (see
<a href="http://p2pfoundation.net/Blended_Value">http://p2pfoundation.net/Blended_Value</a>).<br><br>Of course, all these approaches are marginal. But in the context of a growing impossibility of capitalism as a system of infinite growth within a finite system of natural resources, will they not be the only ways for any kind of market to survive? What we need to do as a mental exercise therefore, is to see the market as simply another way to manage scarce physical resources, divorced from the interest-based-money driven growth cyles. (
<a href="http://p2pfoundation.net/Markets_without_Capitalism">http://p2pfoundation.net/Markets_without_Capitalism</a>)<br><br>So to conclude: 1) social change will be the result both of alternative-world-construction AND by adaptation by the more enligthened sectors of the current elite; 2) because peer-based forms are more economically and politically productive, there is a lot of social weight behind them
<br><br>Please note I'm not excluding 'tough struggles', but I think we should be open-ended in our expectations. As far as I know neither the transition towards feudalism, nor the transitions towards capitalism, were clearcut generalized models of straight antagonism ...
<br><br>Below: 1) an excerpt of different kinds of wealth 2) wealth acknowledgement systems 3) a previous answers that may not have made it<br>
<p><b>1. Tradable Wealth:</b>
</p><p>Food, shelter, services, time, are all forms of tradable wealth.
We are all familiar with tradable wealth--it is the stuff we need and
want, the resources that we compete for. Things we can trade are the
products or the components of systems.
</p><p><br>
<b>2. Measurable Wealth:</b>
</p><p>My health is non-tradable--I can't give it to you. I can give
you my blood, which may affect both of our health, but I can't give you
my health itself. It is a property of my body as a whole. However, you
can measure my health in lots of objective ways: the miles I run or the
number of times I see a doctor. Another thing that is non-tradable is
the productive capacity of a factory. I can sell you the products of
the factory, or the factory itself, but not its productive capacity.
But you can measure its productivity by comparing its output to the
inputs it requires. Similarly the health of a forest is non-tradable.
Its diversity, resilience, etc. can, as with bodily health and
productive capacity, be affected and objectively measured, but it can't
be traded. Bodies, factories, and forests are all examples of systems.
Things we can measure but not trade are properties of systems as a
whole.
</p><p><br>
<b>3. Acknowledgeable Wealth:</b>
</p><p>Friendship, beauty, freedom, civility, culture, happiness,
integrity, reputation--these are all forms of acknowledgeable wealth.
They are neither tradable nor objectively measurable because their
impact is only felt subjectively. I can have friendships of different
strengths--from an acquaintance to a best buddy--and though I can tell
the qualitative difference between them, that difference is not
measurable using any external scale. Rather, it is a difference in
quality of relationship between one system (me) and two other systems
(my acquaintance, and my buddy). Similarly my professional reputation
comes from my relationships with my previous clients. As a potential
client you can get a subjective sense of my reputation by talking to my
previous clients, but there is no one objective standard to go by in
making your choice. Those things that we can acknowledge but cannot
measure or trade are inter-systemic resonances."
(<a href="http://openmoney.info/sophia/index.html" class="external free" title="http://openmoney.info/sophia/index.html" rel="nofollow">http://openmoney.info/sophia/index.html</a>)</p><br><h2>Why a Wealth Acknowledgement System is necessary
</h2>
<p>"When I barter a dozen of my eggs for a pound of your carrots,
wealth acknowledgment happens in the act of haggling: It's where we
determined how many eggs for how many carrots. When I pay you a coin
for your carrots instead (because you don't want my eggs), the coin
itself is the acknowledgment of the wealth transfer. The advantage is
that the wealth-acknowledgment token, the coin, is redeemable elsewhere
in the community. And when communities start using paper notes as
wealth-acknowledgment tokens instead of precious metal, the number of
transactions is no longer limited by the amount of metal available.
When communities invent wealth-acknowledgment tokens for investment,
like stock certificates sold by entrepreneurs, they further unlock the
potential for growth of wealth.
</p><p>These examples show how the evolution of wealth-acknowledgment
systems prepares the ground for the growth of wealth. They also show
how wealth-acknowledgment systems are adopted by communities to reduce
their risk in making transactions. Bartering is not risky because the
wealth is immediately exchanged, but what if I don't need your carrots?
Accepting a token allows me to give without immediately getting wealth
in return, because I know I can use the token to get wealth later.
Stocks and bonds work similarly in higher-risk situations. Thus
wealth-acknowledgment systems evolve in a feedback spiral with social
cohesion and trust. They require some level of trust and cohesion to
function, but they generate much greater cohesion and trust, which
allows new wealth-acknowledgment systems, and the loop continues.
</p><p>Grant-making, endowments, charitable trusts, and donations
(what we call philanthropy), are all efforts to increase measurable or
acknowledgeable wealth. Organizations that seek to increase measurable
and acknowledgeable wealth in communities almost always suffer from the
lack of money. To increase our ability to cultivate these levels of
wealth, we need a wealth-acknowledgment system that moves beyond
money."
(<a href="http://openmoney.info/sophia/index.html" class="external free" title="http://openmoney.info/sophia/index.html" rel="nofollow">http://openmoney.info/sophia/index.html</a>)
</p>REPLY TO PAT:<br><br><p class="MsoNormal" style="margin-bottom: 12pt;">Hi Pat,<br>
<br>
I'd like to offer some added perspectives on social change, based on your
input.<br>
<br>
I think that first of all we have a very simple 'logical' ( but actually
physical problem): can a system of infinite growth exist within a finite
physical environment. My answer would be no, and therefore, capitalism as an
infinite growth system is doomed eventually. <br>
<br>
The second question is: what are the drivers of such infinite growth? I have
been convinced by the monetary reformers, that one of the key issue is the
protocol of the monetary system, in other words the interest-based system.
Interest cannot function in a static economy, it requires growth. In a static economy,
you can only pay back the interest (which is not created by the banks) by
taking it from someone else, while in a growth system, the pain is less as you
can get it from the growing pie. But what if the pie can no longer grow? One of
the key issues today is therefore to develop monetary systems with different
protocols, and I think the best way to do this is by 'distributing' the money
creation, and to have direct social production of money.l<br>
<br>
I also agree with you that at moments of deep systemic crisis, we must expect
rather radical change. The shifts between the roman imperial slavery system and
the feudal serf system were pretty radical, a breach of the fundamental logic
of society, and so was the shift from feudalism to capitalism.<br>
<br>
Non-reciprocal peer production would seem to be the emerging logic of
immaterial production, since we see it emerging with such force, and adapting
open/free, participatory, and commons-oriented strategies are competitive
advantages for for-profit institutions and state forces alike (apart from the
natural tendency of communinities to adopt it). In the physical world, the
realm of scarcity, non-reciprocity cannot work, so what I expect are
peer-informed modes of production, such as fair trade (markets subjected to peer
arbitrage), social entrepreneurship (abandoning money as an end, just keeping
it as a means), trust-based resource management (see Peter Barnes). Such a
situation would be consisting with the historical record of previous modes
which always combined pluralism but always under the domination of one core
logic (respectively the gift economy, the tributary logic and the exchange
logic).<br>
<br>
One key question is how antagonistic the change will/must be. It does not seem
that the end of the roman empire and its transformation was antagonist in the
sense of two classes fighting each other, and many feudal to capitalist
transitions did not take the form of bourgeois revolutions. More fundamental
was that in both systems, the new social relations were slowly being built up,
and then, through some mechanism, reached a tipping point. How that tipping
point is reached is I think an open question, and given the record of violent
revolutions, I think not in the interest of emancipatory forces. Rather, we
must strive for means that are congruent with the ends, and I believe that a
constructive strategy of the 'distribution of everything', is the best chance
we have.<br>
\<br>
Michel</p>
<br><br><div><span class="gmail_quote">On 8/30/07, <b class="gmail_sendername"><a href="mailto:keith@thememorybank.co.uk">keith@thememorybank.co.uk</a></b> <<a href="mailto:keith@thememorybank.co.uk">keith@thememorybank.co.uk
</a>> wrote:</span><blockquote class="gmail_quote" style="border-left: 1px solid rgb(204, 204, 204); margin: 0pt 0pt 0pt 0.8ex; padding-left: 1ex;">Paolo,<br><br>Thanks for the links. I have spent some time with the film, Money as debt
<br>and recently wrote this about it.<br><br>The film, Money as Debt -- an underground hit in activist circles -- seeks<br>to explain where money comes from. Most people probably imagine that the<br>government issues the money they use and that, under its surveillance,
<br>banks lend amounts that are covered by assets such as gold and property or<br>at least by cash deposits. In fact, over 95% of the money in circulation is<br>issued by banks whenever they make a loan. The 'fractional reserve system'
<br>traditionally constrained them to lend up to nine times the value of<br>deposits with the central bank; but this ratio has since increased and in<br>some cases no longer exists. The real basis of money, the film points out,
<br>is thus our signature whenever we promise to repay a loan. The banks create<br>that money by a stroke of the pen and the promise is then bought and sold<br>in increasingly complex ways. The total debt incurred by government,
<br>corporations, small businesses and consumers spirals continuously upwards<br>since interest must be paid on it all. The film briefly mentions some<br>possible remedies, including local currencies.<br><br>This attempt to demystify money is admirable, but the message is
<br>misleading. Debt and credit are two sides of the same coin, the one<br>evoking passivity in the face of power, the other individual empowerment.<br>The origin of money in France and Germany is thought to be debt, whereas in
<br>the USA and Britain it is traditionally conceived of as credit. Either term<br>alone is loaded, missing the dialectical character of the relations<br>involved. The role of state-sanctioned banks in creating money involves
<br>some sleight of hand; but they are also subject to the same financial<br>constraints as ordinary businesses. The film demonizes the banks and<br>interest in particular, letting the audience off the hook by not showing
<br>the active role each of us plays in sustaining the system. Money today is<br>issued by a dispersed global network of economic institutions of many<br>kinds; and the idea of economic growth is fed by our own norm of getting
<br>ahead, not just by bank interest.<br><br>Money as debt is a fable that never moves beyond the nationalist<br>assumptions of twentieth-century North American society. It says nothing<br>about the current world economic crisis. This has features that are well
<br>enough advertised in the media. The huge trade and budget deficits of the<br>US economy are financed principally by Japan, China, the Gulf States and<br>Britain (but not the US banks). The dollar's slide seems to be limited only
<br>by its role as the world currency and unit of account for the oil trade and<br>by its creditors' desire to retain the value of their Treasury paper. The<br>interests at stake in the global energy economy are manifested in the war
<br>for Middle East oil; the trade imbalances reflect the transfer of<br>manufacturing production and many services from the West to Asia.<br><br>Moreover, since the invention of money futures in 1975, world money flows,<br>
fuelled by bets on the future prices of notional assets such as stock<br>market indices ('derivatives'), now dwarf the volume of international trade<br>and national budgets. The US housing market is a major part of all this
<br>paper debt, especially the dodgy loans known as 'sub-prime mortgages' now<br>suffering massive default. The faith of the British middle classes in<br>consumerism financed by ever rising housing prices hovers on the brink of
<br>the financial crisis. Reference is occasionally made to the Great<br>Depression of the 1930s, but rarely to more recent demonstrations of the<br>system's fragility: the global slump induced by the oil price hikes of the
<br>1970s or the crash of 1987. We could be entering a new stage of capitalism<br>where markets have been rationalized and risk is managed efficiently; or,<br>more likely, we are heading for a deflationary crisis of unprecedented
<br>severity. In either case, a lot more political education is needed before<br>people can begin to reduce their dependence on an impersonal economic<br>system and develop a more personally meaningful relationship to money.
<br><br>Cheers,<br><br>Keith<br><br>Original Message:<br>-----------------<br>From: paolo massa <a href="mailto:paolo@gnuband.org">paolo@gnuband.org</a><br>Date: Thu, 30 Aug 2007 11:54:59 +0200<br>To: <a href="mailto:keith@thememorybank.co.uk">
keith@thememorybank.co.uk</a>, <a href="mailto:playethical@gmail.com">playethical@gmail.com</a>, <a href="mailto:idc@mailman.thing.net">idc@mailman.thing.net</a><br>Subject: Re: [iDC] Don Tapscott's Wikinomics: A Dismal Netology?
<br><br><br>I would like to suggest two resources that I think are relevant for this<br>thread.<br>They are linked from this blog post<br><a href="http://www.gnuband.org/2007/08/22/avoiding_central_money/">http://www.gnuband.org/2007/08/22/avoiding_central_money/
</a><br><br>1) The video "Money as debt"<br><a href="http://www.gnuband.org/2007/04/09/money_as_debt/">http://www.gnuband.org/2007/04/09/money_as_debt/</a><br><br>2) And the ripple project. Ripple is an open-source software project
<br>for developing and implementing a protocol for an open decentralized<br>payment network.<br><a href="http://ripple.sourceforge.net/">http://ripple.sourceforge.net/</a><br>In particular check the paper "Money as IOUs in Social Trust Networks
<br>& A Proposal for a Decentralized Currency Network Protocol"<br>If you are interested, let me know your email address and I'll<br>probably open a little line of credit (trust!) for you on ripplepay<br>;-)<br>
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