A
MONEYL B
READER 2
OVERCOMING
THE HYPE
MoneyLab Reader 2: Overcoming the Hype
Editors: Inte Gloerich, Geert Lovink and Patricia de Vries
Copy editing: Ed Graham
Cover design: Anastasia Kubrak
Design: Inte Gloerich
EPUB development: Inte Gloerich
Printer: Drukkerij Tuijtel, Hardinxveld-Giessendam
Publisher: Institute of Network Cultures, Amsterdam, 2018
ISBN: 978-94-92302-19-9
Contact
Institute of Network Cultures
Phone: +31 (0)20 595 1865
email: info@networkcultures.org
web: www.networkcultures.org
Order a copy or download this publication freely at: networkcultures.org/publications.
Join: MoneyLab mailinglist: listcultures.org/mailman/listinfo/moneylab_listcultures.org.
Subscribe to the INC newsletter: networkcultures.org/newsletter.
This publication is supported by the Amsterdam University of Applied Sciences and
many crowdfunding donors. In particular we would like to thank Josephine Bosma,
May Hen and Peter Lunenfeld for their generous contributions. MoneyLab Reader 2
is part of the State Machines project. This project has been funded with the support
from the European Commission. This communication relects the views only of the
authors, and the Commission cannot be held responsible for any use which may be
made of the information contained therein.
Thanks to everyone at INC, to all of the authors for their contributions, Ed Graham for
his keen copy-editing eye, Anastasia Kubrak for her exciting design, Leila Ueberschlag and Nicoleta Pana for their successful crowdfunding campaign, and our partners in the State Machines project, Aksioma, Drugo More, Furtherield, and NeMe, for
their inspiring work.
This publication is licensed under Creative Commons Attribution NonCommercial
ShareAlike 4.0 Unported (CC BY-NC-SA 4.0). To view a copy of this license, visit
creativecommons.org/licenses/by-nc-sa/4.0/.
A
MONEYL B
READER 2
OVERCOMING
THE HYPE
E DI T E D B Y
I NT E G L O E R I CH
G E E RT L OV I NK
A N D PAT R I CI A DE V R I E S
I N C R E A DE R # 1 1
Previously published INC Readers
The INC Reader series is derived from conference contributions and produced by the
Institute of Network Cultures. The publications in this series are available in EPUB,
PDF form, and a print run of 2000 copies.
INC Reader #10: Geert Lovink, Nathaniel Tkacz and Patricia de Vries (eds),
MoneyLab Reader: An Intervention in Digital Economy, 2015.
INC Reader #9: René König and Miriam Rasch (eds),
Society of the Query: Relections on Web Search, 2014.
INC Reader #8: Geert Lovink and Miriam Rasch (eds),
Unlike Us: Social Media Monopolies and Their Alternatives, 2013.
INC Reader #7: Geert Lovink and Nathaniel Tkacz (eds),
Critical Point of View: A Wikipedia Reader, 2011.
INC Reader #6: Geert Lovink and Rachel Somers Miles (eds),
Video Vortex Reader II: Moving Images Beyond YouTube, 2011.
INC Reader #5: Scott McQuire, Meredith Martin and Sabine Niederer (eds),
Urban Screens Reader, 2009.
INC Reader #4: Geert Lovink and Sabine Niederer (eds),
Video Vortex Reader: Responses to YouTube, 2008.
INC Reader #3: Geert Lovink and Ned Rossiter (eds),
MyCreativity Reader: A Critique of Creative Industries, 2007.
INC Reader #2: Katrien Jacobs, Marije Janssen and Mateo Pasquinelli (eds),
C'LICK ME: A Netporn Studies Reader, 2007.
INC Reader #1: Geert Lovink and Soenke Zehle (eds),
Incommunicade Reader, 2005.
All INC Readers, and other publications like the Network Notebooks series, INC
Longforms, and Theory on Demand, can be downloaded and read for free.
See networkcultures.org/publications.
CONTENTS
Inte Gloerich, Geert Lovink, and Patricia de Vries
Overcoming the Blockchain and Cybercurrency Hype:
Introduction to MoneyLab Reader 2
7
UPDATING DIGITAL ECONOMY
Patricia Reed
Optimist Realism: Finance and the Politicization of Anticipation
14
Nina Power
Necro-Capitalism and Counter-Images
23
Nathaniel Tkacz and Pablo R. Velasco
Experience Money
31
BLOCKCHAIN CRITICISM
Robert Herian
Blockchain and the Distributed Reproduction of Capitalist Class Power
43
Jaya Klara Brekke
Postcards from the World of Decentralized Money: A Story in Three Parts
52
Max Dovey
Love on the Block
64
PERFORMING FUTURE FINANCE
Martin Zeilinger
Contemporary Art Between Algomysticism and Fintech Activism
74
Laura Lotti
Financialization as a Medium: Speculative Notes on Post-Blockchain Art
87
Emily Rosamond
It Sees (Notes Toward a Cultural History of Financial Vision)
101
David Hollanders
The Reception of the Financial Crisis in Hollywood Movies
115
Max Haiven
The Crypt of Art, the Decryption of Money, the Encrypted Common and
the Problem with Cryptocurrencies
121
CRITIQUES OF THE GRAND SCHEMES
Rachel O’Dwyer
Things that Transact: How the Internet of Things is Transforming Payments
138
Brett Scott
Cash in the Era of the Digital Payments Panopticon
146
Tripta Chandola
The Demons of Demonetization: Devaluing ‘Trust’ as a Currency In Informal
Economies, An Ethnographic Account
159
Silvio Lorusso
First as Arts, Then as Tragedy — Two Cents on Personal Crowdfunding and
Creative Entrepreneurialism
172
Nathalie Maréchal
The Data Paradox: How the War on Poverty Became a War on the Poor
185
ALTERNATIVES IN FINANCIAL IMAGINATION
Trebor Scholz
How to Coop the Digital Economy
197
Dmytri Kleiner
Universal Basic Income is a Neoliberal Plot to Make you Poorer
215
Patrice Riemens
Precarity is the Present, Universal Basic Income the Future
221
Economic Space Agency
On Intensive Self-Issuance: Economic Space Agency and the Space Platform
232
General Intellect
Commonfare or the Welfare of the Commonwealth
243
APPENDICES
Eduard de Jong, Geert Lovink, and Patrice Riemens
10 Bitcoin Myths
252
Platform Coops
257
MoneyLab Conferences
274
Author Biographies
277
INTRODUCTION
OVERCOMING THE
BLOCKCHAIN AND
CYBERCURRENCY
HYPE:
INTRODUCTION TO
MONEYLAB READER 2
INTE GLOERICH,
GEERT LOVINK,
AND PATRICIA DE VRIES
7
MONEYLAB READER 2
A
8
OVERCOMING THE BLOCKCHAIN AND
CYBERCURRENCY HYPE:
INTRODUCTION TO MONEYLAB READER 2
INTE GLOERICH, GEERT LOVINK, AND PATRICIA DE VRIES
From place to place, to those many still left open,
where there’s perplexity and darkness but also gaps and rapture…
—Wisława Szymborska, Labyrinth
Welcome to Overcoming the Hype. This second MoneyLab Reader prods emerging,
rising, crashing and burning digital money memes. Ever since its inception, in 2013,
the MoneyLab project tinkers with digital money and inance experiments. We question persistent beliefs, from Calvinist austerity, growth, and up-scaling, to trustless
automated decision-making, and freedom on the dark web, from (anarcho-)capitalist
dreams of the days of yore to the special sauce of neoliberal entrepreneurialism and its
right-wing libertarian counterparts.
Entering the 10th year of the global inancial crisis, it still remains a diicult yet
crucial task to distinguish old wine from its fancy new bottles. We need to recognize the ruling inancial system in its ostensible alternatives. Neoliberal concepts
and convictions such as growth, scale and free markets are often repackaged in
mystifying and depoliticizing wrapping paper such as ‘sustainable’, ‘parallel’, ‘local
economies’, ‘co-ops’, ‘disruption’, ‘universal basic income (UBI)’, and ‘lexibility’
but lack or misire structural and systemic critique, or cleverly shadow-box their
way around it. We are ‘willing slaves of capital’, as Frédéric Lordon wrote,1 and if we
trust the Believers, we will soon be (neo-)liberated by internet-based, autonomous
payment systems or UBI.
With the monopoly of Central Banks crumbling, the very deinition of money is up for
grabs. MoneyLab considers blockchain technology, cybercurrencies and other experiments with value exchanges as spaces of political contestation and possibility. Designing internet-based payment and network-based revenue models is a political project, and one with an equally important aesthetic program. MoneyLab asks designers,
geeks, researchers, artists and activists: what role can criticism play when technology
accelerates? And how can we work together to make a diference?
Over the past years, the Cyberworld fantasies of yesteryear have been rekindled, in
updated and automated form, in stories about invincible, decentralized blockchains
and heroic crypto-currencies, promoted as a refreshed parallel universe of digital value
storage that can weather any storm as well as overcome the incessant global inancial
crisis. This tweet by Brett Scott pretty much sums up the MoneyLab critique of the
1
Frédéric Lordon, Willing Slaves of Capital: Spinoza and Marx on Desire, New York, NY: Verso
Books, 2014.
INTRODUCTION
9
hype: ‘Crypto logic 101: Bitcoin is worth holding onto because it will become worth
more Why will it be worth more? Because more people will start using it But aren't
they just holding it, rather than using it? Yeah, but eventually we'll use it What for? To
cash out into US dollars.’2 For many, such Bitcoin critique is Maoist-style self-criticism.
There is not much intellectual clout in constantly having to ‘reveal’ the bubble nature
of inancial schemes. For intech speculators, there is no deeper value in crypto-currencies, only possible proits in buying and selling after an uncertain period of hoarding. For them, Ethereum is just another inancial asset, accumulated under the sign of
‘collective self-interest’.
The question of how digital money can actually be woven into the broader architecture
of the internet is not their concern in the least. Due to speculation fever, the larger
debate around what design of digital money would be desirable has come to a complete hold. What remains are security questions of wallets and exchanges, the use of
crypto-currencies inside countries in crisis (such as Venezuela), as payment method in
the case of ransomware, and as carrier in (illegal) cross-border transactions.
While blockchain technology ofers some interesting visions on future scenarios, most
of the potential has been swallowed up by business logistics. Decentralized, free software approaches have been sidelined along the way. Unfortunately, the new toys are
often ideologically damaged, dead on arrival or corrupted early on by a handful of
fund managers looking for ways to jump the crypto-currency bandwagon. Blockchain
technology, too, raises fresh concerns over citizen privacy and the rise of inancial
surveillance, and while a cashless society looms closer, the virtues of paper money are
rekindled. As crypto-currencies are so far failing as payment systems, it is important
to diversify the issue of alternative internet-based revenue models and complement it
with community funding, subscription-based support (such as Patreon), local barter
exchanges, mobile money, and blockchain solutions that are disconnected from any
speculative crypto-currencies.
Chained on a block, automated, wireless, digitized and cashless: money has become
a virtual medium of exchange, an interface, yet another speculative asset, and therefore highly vulnerable to political currents, sudden glitches such as stock market
crashes, infrastructure breakdowns, miscalculations, cyberwar, ransomware, and the
ive elements of nature.
With Yanis Varoufakis we say: there’s no such thing as apolitical money.3 And there
is no such thing as an apolitical crisis. Ever since the 2008 ‘crisis,’ inancial activism has played a role for people’s parties in Europe, demanding transparent, open,
and more democratic forms of governance. Populist policies, regardless of being
left or right wing, inherently form around a general desire to unhook politics from i-
2
3
@Suitpossum, ‘Crypto logic 101: Bitcoin is worth holding onto because it will become worth
more Why will it be worth more? Because more people will start using it But aren't they just
holding it, rather than using it? Yeah, but eventually we'll use it What for? To cash out into
US dollars.’, Twitter post, 13 November 2017, 9:38 AM, https://twitter.com/Suitpossum/
status/929991744648810496.
Yanis Varoufakis, And the Weak Sufer What They Must? London: Penguin Random House, 2016,
pp. 98-99.
MONEYLAB READER 2
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nancial corruption. As popular people’s parties near an electoral majority, what can
be learned from these types of decentralized, bottom-up movements? Campaigns
for UBI and transparent participatory budgeting should also be contextualized
from an increasing awareness of inancial corruption and economic inequality. As
political reformation spreads through Europe, small alterations within local and national governments have been made, but are these improvements minor repairs to
a broken system?
For Valarie Solanas, author the radical-feminist-punk-anarcho Scum Manifesto (1967),
real liberation does not come from economic equality. Part satire, part political science-iction, part pamphlet, Scum Manifesto states that economic equality amounts to
nothing other than ‘co-managing the shit pile.’ Solanas therefore argues for what could
be labelled as a fully automated society without a money system. The real challenge
we are facing, Solanas observes quite appositely, is a conlict between those that buy
into the money-work system and those that refuse the money-work system altogether.4
Today, ifty years later, the money-work system is still wading nostril-deep through a
quagmire of systemic malaise and oppressions of various kinds and degrees. Automation is considered both the Pearly Gate and the Final Countdown. Concern over
wealth distribution, poverty, precarity and accountability has given rise to both political
populism and a inancial counterculture. If we want the ‘whole bloody bakery,’ and not
some leftover bird-crumbs, we need to go the core, and reimagine and redeine the
power of money itself.
The black box of inance has been etched into the imagination of the public and there
has rarely been a more generous context to manifest working alternatives for the 99%.
Cooperative platforms, decentralized technologies and direct democracy movements
indicate profound attempts to rebalance the distribution of wealth and power. As resistance towards poverty, precarity, tax havens, algorithmic speculation, and inancial
crimes grows, the challenge ahead is to ind ways to improve and sustain such inancial experimentations and do more than ‘fail better’.
In amongst the cacophony of economic dissent of the past decennium, some brave
the ‘shit pile’ and invent practical solutions to protect their livelihoods and design new
ways to distribute value and make a living. Rather than wait to implement changes in
traditional legislation, they are attempting to transform governance by writing smart
contracts into decentralized systems. Programmers and designers quickly meet the
increasing demand for decentralized services by building infrastructures that harness
the scope of the network and rely on the database to enforce new forms of governance with smart contracts. In their eforts, artists ofer perspectives on how collective ownership can provide security or establish terms for contracts and licenses that
enable equitable incomes.
Platform coops are not just ethically responsible alternatives to exploitative on-demand business models: they ofer practical solutions for providing social security
and equitable income for the ‘unnescessariat’. Writers and publishers also endeavor
to create working solutions that circumvent extractive platform monopolies. Musi-
4
Valerie Solanas, Scum Manifesto, New York, NY: Verso Books, 2004.
INTRODUCTION
11
cians are equally desperate to reshape an industry that, in an attempt to stamp
out piracy, has turned digital streaming into a murky, penniless revenue model that
only serves platform-based superiority. They all join a growing precarious class of
creative workers desperate for an exit strategy from exploitative platform monopolies and inequitable licenses that siphon of and centralize proits. From p2p distribution models to collective piracy, print and digital publishing, all demonstrate intuitive
alternative means to survive within a digital economy. MoneyLab continues to investigate these and other attempts to circumvent and overcome the challenges faced in
the austerity economy.
For god’s sake, don’t take inancial advice from cryptographers.
—Matthew Green
MoneyLab steps away from old-school critique of the political economy. It is justiied to make pyramid schemes and parasitic logic inside intech software visible,
but this is not yet a strategy for change. In his dialogue with Krystian Woznicki,
Brian Massumi explains how we can move beyond the accelerationist agenda of
‘outsmarting’ capitalism with IT innovations through ‘adventure capital’. The new
models (also expanded upon by the Economic Space Agency in this Reader) ‘would
be owned collectively, without division into individual shares, and would be only
used to further the activities of the collective.’ A key idea that is pushed further,
here, is the trustless automatic execution of contracts with the aim to ‘refuse any
formal decision-making procedures, whether vote-based or consensus-based.’ The
idea would be to ‘activate tendencies agitating at the infra-individual level [...] generating a surplus value of life that is irreducibly collective, and entirely event-based.’
Terms developed in this context are ‘event-derivative’ and ‘occurency’. The overall
aim is ‘to hijack cutting-edge tools of runaway speculative inance’, to become more
speculative than the speculators, turning the dark casino parasite logic of inancial
capital into a gift economy.5 The MoneyLab line is here to bring together radical critique with an equally radical imagination. We will never accept having our ruthless
negative attacks be played out against a so-called constructive form of New Age
positivism. Experiments at MoneyLab are notoriously beyond good and evil, and do
not accept any Denkverbot.
We need to get a critical understanding of the nature of the Financial Intellect. What is
the social expression of all these alternative eforts? We’re not only producing software
and platforms. Our class-in-becoming is well aware that the internet and its infrastructure no longer is a tool, a means to something else. There is no more money outside
the digital. Production can no longer be situated outside of digital lows through networks. In the past, geeks tickered with obscure operating systems. No one cared.
Today, geeks are entering highly attractive, dangerous territory. As apprentices they
enter a Faustian workshop where digital alchemists are creating money out of nothing
(but energy…). Let’s return to Goethe to ind out how this episode will end. Is it time
to rewrite and update your Goethe? Do you agree with Johan Sjerpstra’s statement:
‘I think of crime when I’m in a crypto state of mind’?
5
Brian Massumi and Krystian Woznicki, After the Planes: A Dialogue about Movement, Perception
and Politics, Berlin: Diamondpaper, 2017, pp. 146-147.
MONEYLAB READER 2
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Whereas the irst MoneyLab Reader from 2015 dealt with payment systems, money
theory, critical currencies and projects that accelerated our inancial imagination, this
second Reader presents an update on alternative models such as platform cooperativism (Trebor Scholz), debates around universal basic income (Patrice Riemens; Dmytri
Kleiner), and cashless society (Brett Scott). The idea of a coin of the commons that was
proposed in the irst Reader is now embedded in a broader concept of a Commonfare society that combats widespread precarity (General Intellect) like that evidenced
by crowdfunding campaigns for medical procedures (Silvio Lorusso). In 2015 we still
wondered whether internet banking was the real killer app. We're now witnessing the
unforgiving consequences of the demonitization project in India (Tripta Chandola). The
Panama and Paradise Papers showed the true cash cows of tax evaporation/evasion
are to be found at the top of inancial hierarchies; still the US government continues
to double down on petty welfare fraud and individual freedom for the poor (Nathalie
Maréchal). Monetary and inancial instruments subject society to their automated visions through data captures and surveillance (Emily Rosamond), while popular representations of the inancial sector fail to move beyond the epic tale of the Wall Street
(anti-)hero (David Hollanders).
Two approaches stand out in both MoneyLab Readers. First of all, the critique of
right-wing libertarian tendencies inside intech is not expressed out of some resentment but always coupled with alternative practices. The second angle is the
way in which we integrate artists and art projects into the larger picture. The art
contributions here are neither illustrations nor isolated pieces. We see art as a vehicle to focus on the very basics of value creation and exchange. That being said,
MoneyLab does not want to repeat the old Romantic chestnut of the artistic genius
evading the political and climatic dissipation of Western capitalist civilization. We
repeat, we do not believe an automated workforce or blockchained currencies will
found a new global social order routed in equity, love and solidarity. We do aim
for broadening a critical space for the deconstruction of capitalist realism,6 and to
enlarge and diversify digital non-capitalist imaginaries, concepts, activities, and exchanges of value. As a result, some authors critically engage with a diverse array of
waxing and waning practices that have been over-coated, overlooked or overrated
by capitalist realists. Others work to broaden the scope of our economic imaginaries. Taken together they form a necessary contribution to overcome the hype and
a counterargument to capitalist realists that cannot think of alternatives outside of
their self-maintained capitalist cage.
We start of with such a priori complexity withdrawal and capitalist realism (Patricia
Reed) and move on to questions such as: how do we imagine ourselves as part of
the world/system called necro-capitalism (Nina Power)? What happens when digital
money invades our lives as apps, stored and traded on our intimate smart devices
(Nathaniel Tkacz & Pablo Velasco)? How can we cut through the algo-mysticism
that surrounds supposedly disruptive inancial technology (Martin Zeilinger) and see
the power relations that they perpetuate (Robert Herian)? How did we end up with
the vision of blockchain marriages in which vows are seen as smart contracts (Max
Dovey)? Can 'code is law' be subverted by rebelliousness and wokeness on the
6
Mark Fisher, Capitalist Realism: Is There no Alternative? London: Zero Books, 2009.
INTRODUCTION
13
blockchain (Jaya Klara Brekke) or can economic spaces be programmed to be modular and lexible in nature (Economic Space Agency)? Tokenization as art form (Laura
Lotti) and the inancialization of the arts (Max Haiven) are both already implemented
phenomena. What does human agency mean among algorithm-based, market-driven
Internet of Things objects that transact increasingly independently (Rachel O'Dwyer)?
Fintech rushes through our veins, causing a whirlwind of concepts in our head, featuring all the possibilities and alternatives that our imagination and political spaces
can bring. Welcome back to MoneyLab.
References
Fisher, Mark. Capitalist Realism: Is There no Alternative? London: Zero Books, 2009.
Lordon, Frédéric. Willing Slaves of Capital: Spinoza and Marx on Desire, New York, NY: Verso Books,
2014.
Massumi, Brian, and Krystian Woznicki. After the Planes: A Dialogue about Movement, Perception and
Politics, Berlin: Diamondpaper, 2017.
Solanas, Valerie. Scum Manifesto, New York, NY: Verso Books, 2004.
Varoufakis, Yanis. And the Weak Sufer What They Must? London: Penguin Random House, 2016.
MONEYLAB READER 2
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OPTIMIST REALISM:
FINANCE AND
THE POLITICIZATION
OF ANTICIPATION
PATRICIA REED
UPDATING DIGITAL ECONOMY
15
OPTIMIST REALISM: FINANCE AND
THE POLITICIZATION OF ANTICIPATION
PATRICIA REED
With almost a decade since the climax of the 2008 global inancial crisis, two poignant, parallel phenomena can be noted. On the one hand, the inancial sector
seems to have lost little grip on capital-power (or ‘inance-power’).1 Banks have
been bailed out, inancial ‘services’ have returned to ‘business as usual’ and, more
generally (despite policy papers otherwise),2 austerity and growth (debt and credit),
the neoliberal yin and yang par excellence, persist as the ‘necessary’ creed for economic advancement. On the other hand, we have seen a popular consciousnessraising regarding today’s gaping inequality; this is due in part to widespread, global
protest movements (notably Occupy! and its infamous ‘we are the 99%’ refrain),
and to the sheer material/existential efects our order has fostered as it has extended its tentacles over time. The aftermath of the crisis has produced what many
on the left have been clamoring for: A popular delation in the ideological promise
of the neoliberal myth. The latter’s ‘internal contradictions’ and inability to deliver
on pledges of trickle-down prosperity have become blatantly apparent far beyond
the walls of academic discourse. Yet, in what ought to have been a pivotal context
for political mobilization towards alternative horizons of socio-economic justice (or
even modest restructuring), we have seen, rather, an entirely more frightening, neofascist political reality emerge. Why is it that we are not seizing this momentous,
mythical delation towards the politicization of a new socio-economic model bending towards the service of the many? The answers to this arguably naïve question are of course numerous, and there are certainly powerful vested interests and
peoples who gain from status-quo crises and social instability. However it would be
equally naïve to suggest this debilitating and regressive ‘change’ can be reduced to
problems exclusively in the frame of personal greed and self-interest; as problems
located entirely within the domain of morality. I’d like to direct attention to two interwoven factors that have, to my mind, played an important role in driving our current
political landscape, and ultimately how new socio-economic conceptions may ind
mesopolitical3 potential in making claims on one of the distinguishing markers of
our era: the transformation of temporality itself.
Put succinctly, two interconnected factors blocking the transformative capacities of
this ideological delationary moment include what could be called ‘complexity withdrawal’, and the persistent naturalization of capitalism (what Mark Fisher notably
1
2
3
Suhail Malik, ‘The Ontology of Finance: Price, Power, and the Arkhéderivative’, in Robin Mackay
(ed.), Collapse Volume VIII, Falmouth: Urbanomic, 2014, p. 637.
Jonathan D. Ostry, Prakash Loungani, and Davide Furceri, ‘Neoliberalism: Oversold?’, Finance and
Development 53.2 (June 2016), http://www.imf.org/external/pubs/ft/fandd/2016/06/ostry.htm.
Isabelle Stengers interviewed by Brian Massumi and Erin Manning, ‘History through the Middle:
Between Macro and Mesopolitics’, Inlexions: A Journal for Research-Creation 3 (October 2009),
http://www.senselab.ca/inlexions/volume_3/node_i3/stengers_en_inlexions_vol03.html.
MONEYLAB READER 2
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coined as ‘Capitalist Realism’ — an obstinacy he insisted could survive beyond the
collapse of the neoliberal capitalist paradigm).4 Let’s start with the second formulation, as it feeds-forward into the irst.
Petriied Futurity
Capitalist Realism indexes not only our economic condition, but more pervasively,
the ‘atmosphere’ of political resignation which denies the possibility for any other
socio-economic structural scenario. This ‘atmosphere’ permeates both conscious
and unconscious life, including the arena of cultural production (music, art, ilm, etc.)
where instead of seeing boundless innovation (a capitalist premise), we seem caught
in retroparalysis: loops of re-makes and pop-cultural revivalism,5 where substantial
technological development devolves into trivial consumer gadgetry.6 Within such an
atmosphere, mental distress and illness has also proliferated as a debilitating symptom of the behavioral imperatives this naturalization entails. This is in the way one is
compelled to ‘govern from within’ to adapt to the world successfully in full, entrepreneurial self-reliance. Such naturalization is internalized as the only system compatible with ‘innate’ humanness, where this picture of ‘innateness’ is both self-referential
and self-reinforcing, coercing the human into a narrow mold wherein the incentive of
accumulation through competition is isomorphic with our ‘intrinsic’ selishness and
self-interest (those very social biases buttressing neoclassical economics, upon which
neoliberalism is built). In this framing, capitalism is upheld as the only system commensurate with the ‘nature’ of the human; to suggest otherwise is to fall prey to folly,
almost as nonsensical as ighting the fact of gravity on earth. The diagnosis Fisher puts
forth, quite pointedly, is that Capitalist Realism petriies politics because it stiles our
imaginative and perspectival horizons. The axiom then gets extrapolated: if futurity is
always a political project and politics is dead-locked, our future, as such, has become
cancelled — a point to which we will return.
Complexity Withdrawal
The second factor leading to our inability to seize upon this neoliberal delationary
moment is what I like to call ‘complexity withdrawal’. As a response to the debilitating efects of globalization (understood only in its negative delineation, as rampant
inancialization and corporatization), we have seen a retreat to nationalisms, based
on assurances of economic betterment through isolationism, coupled with identitarian essentialisms. Such tendencies can be read as a relex against the complexity of
globalization (again, construed only negatively); making things simpler, graspable and
(relatively) immediate as a reaction against the intractability of today’s interconnected
reality. Because Capitalist Realism imbues in us a domineering condition of political
impotence, there is nothing to anticipate besides catastrophe and the dystopian. With
nothing to look forward to, we can only look back; eyes ixated on romanticized histories (for very few, and those that never were), to ‘make great’ again with full Westphalian vigor. Capitalist Realism nourishes complexity withdrawal, where its hold over
political transformation renders any demand for counter-hegemonic-scaled change
4
5
6
Mark Fisher, Capitalist Realism: Is There No Alternative, London: Zero Books, 2009.
Ibid., p. 7.
Exempliied by the proliferation of ‘Weird Face Apps’, where highly sophisticated machine learning
and A.I. systems are used for quite trivial, entertainment-rich outputs: face matching celebritylikeness, for example.
UPDATING DIGITAL ECONOMY
17
unthinkable, unsensible, unimaginable. It locks us into (at best) modest proportions,
at odds with the scale of the system we seek to contest. The engagement with complexity certainly does not ofer the guarantee of causal immediacy, nor ‘ixable’ or
fully determinate outcomes. But the withdrawal from it disengages the potentiality for
counter-hegemony, understood as an emergent phenomenon (and not a preigured
template) between agency (human intentions) and structure (non-human factors).7 Our
current theoretical landscape often also echoes this hopelessness; densely packed
with dismal-to-horriic non-futural diagnoses. These meditations are quite accurate,
in the sense that one cannot disagree with the course they carefully plot. Yet does not
the surety of their description and unwillingness to propose alternatives inadvertently
reinforce the ‘changeless-change’8 of capitalist realism itself, despite the oppositional
claims made against it? Such scenarios demonstrate the futility in substantially confronting capitalist hegemony based on grounds of sheer criticism (as an end) or moral
rejection, without contributing to the libidinal imaginings and/or functional diagrams
of alternative possibilities. When the production of theory declines to engage with the
propositional, there remains little optimism for material practice or a pragmatics of
just, futural speculation to emerge. The omission of optimism from (non)-politics today,
and indeed much of social life in general can, as Rory Rowan has written, ‘…tacitly
legitimate the lessons of individualized quietude taught by conservatives who tell us
that the ‘small, happy life’ ofers deliverance from the dangerous delusion of collective
transformation […] Just as blind optimism risks lubricating existing forms of power,
an equally blind pessimism risks stunting the collective capacities required to oppose
them.’9 What is asserted here is the need for an optimist realism, not one where we
conceive of the inevitability of ‘progress’ through wishful thinking, or transformation
actionable through heroic will — but an optimism tethered to our capacity for artiiciality.10 That is, to the plasticity of politics embedded in, and constrained by reality that
is partially constructable by us, whilst simultaneously indiferent and invariant to us.
Denaturalizing (A)Social Myths
Before proceeding, let me emphasize an important point. What we can glean from the
articulation of these double forces of capitalist realism and complexity withdrawal,
is that any alternative socio-economic paradigm requires not only the modeling of
a new system, but the profound denaturalization of the (a)social myth of ‘human nature’ through which capitalism is repeatedly performed, incorporated and enabled. To
advocate exclusively for a remodeling of our economic system as an external thing,
reinforces the Silicon Valley doctrine of what Evgeny Morozov termed ‘solutionism’,
wherein problems can be remedied through techno-scientiic innovations alone.11
Such solutionism (at ease and quite proitable within neoliberalism) may placate symptoms, but leaves underlying causes untouched. A Fitbit (or any activity tracker) may
7
8
9
10
11
Alex Williams, ‘Complexity & Hegemony’, PhD diss., London: University of East London, 2015.
Sebastian Olma, In Defense of Serendipity: For a Radical Politics of Innovation, London: Repeater
Press, 2016.
Rory Rowan, ‘Extinction as Usual?: Geo-Social Futures and Left Optimism’, e-lux
Supercommunity, 31 July 2015, http://supercommunity.e-lux.com/texts/extinction-as-usual-geosocial-futures-and-left-optimism/.
Hannah Arendt, On Revolution, New York: Penguin Books, 1963, p. 20.
Ian Tucker, ‘Evgeny Morozov: “We are abandoning all the checks and balances”’, The Guardian,
9 March 2013, https://www.theguardian.com/technology/2013/mar/09/evgeny-morozovtechnology-solutionism-interview.
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tell us we need to do more exercise or notify us of high blood-pressure, but it addresses nothing of the socio-economic, and indeed mental landscape where stress
and lack-of time (the high estimation of busy-ness) are the everyday consequences of
our existing hegemony of life’s demands, for example. The solutionist doctrine transforms socio-structural and ideological problems into private, behavioral ones that can
be surmounted on one’s own (more discipline!). This bolsters the very emphasis of
personal responsibility and self-governance that sustain neoliberalism. Because of the
inadequacy of solutionism, the transition to an inexistent system we might temporarily
call ‘postcapitalism’ (since we don’t yet know what it is, and therefore how to name it),
requires a movement on two planes: the external transformation of the system itself
(of valuation, tokening, distribution, production, labor, exchange, etc.), coupled with
an internal transformation of our collective self-conception of the ‘human’ as well.
Leveraging the entanglements between conceptual ideality and physical reality,12 it is
along these mutually contaminating vectors of human self-understanding and material
functionalism where an ‘optimist realism’ needs to take hold.
Any mode of social ordering requires bodies, ideas and processes to sustain it —
whether these conceptual predispositions are explicitly known, or silently embodied
through everyday gestures. The habituation of these modes reinforces underlying assumptions in a positive feedback dynamic, normalizing these social concepts into a
quasi-natural order. The logic of our neoliberal order is no diferent; it requires constituent human actors (and the systems through which they engage) to behave within
a landscape of naturalized myths. These myths are necessary for cohesion, but are
always artiicial and subject to revision. In Capitalist Realism, these myths mapping
who we are as humans have been petriied and treated as the only system accommodating our ‘nature’; a brutally ironic enablement of our ‘nature’ that destroys the very
biosphere we need for even the most basic biological life support. As a denaturalizing
demand, optimist realism must begin with the labor of separating norm (myth) from
fact. Such a labor can be encapsulated by the concept of alienation — of articulating
chasms between norm and fact, not to attain some telos of scientiic facticity as a
guiding social horizon, but in an efort to retrain the myths of social cohesion we need
towards the care of the many. As a capacity to separate what is towards what could
be, alienation can no longer be conceived as a strictly negative force of disconnection,
but must be embraced for its abstractive capacities to separate from what is before us
as a naturalized logic, towards a speculative investment of future possibilities, requiring alien myths of human ‘givenness’.
Operationalizing Derivative Temporality
When politics (in both its imaginative and infra/-structural forms) is trapped in stagnation, it’s purchase on futurity is cancelled.13 This, however, does not mean the
future is absolutely annulled, but it signals the displacement of the future from the
domain of politics. Where can we locate the future today? From the perspective
of power and pragmatics, the future has been coopted by the category of inance;
the future has dissolved (and bifurcated) into futures. One cannot begin to describe
12
13
Ray Brassier, ‘The View from Nowhere’, Journal for Politics, Gender and Culture 8.2 (Summer
2011), pp. 6-23.
Mark Fisher, ‘The Slow Cancellation of the Future’, Lecture: MaMa, Zagreb, Croatia, 2014, https://
www.youtube.com/watch?v=aCgkLICTskQ.
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the paradigm of inancialization without emphasizing the particular shift in temporal
operations it has brought about — far more elaborate than the common lamentation
of pure ‘out of control speed’. As Elena Esposito has made clear, in classical forms
of capitalism (like industrial production) the present was sacriiced for the future,
insofar as one would reinvest current proits to generate increased future revenues.
With inance this temporal relationship is reversed: one spends money one expects to accrue at a future date in the present.14 In its more virtuous form, inance,
predicated on credit, can ‘exploit in the present the openness [my emphasis] of the
future’15 — meaning that one imposes constraints on the future (the debt / responsibility for repayment accrued through credit) to construct a more prosperous one,
which would not have been possible without having initiated the constraint.16 This
process points to the underlying recursivity of the operations (and power dynamics)
involved in construction of futurity today.
Deploying the derivative as the deining object through which to parse the set of
generic operations qualiied as ‘inance’, Suhail Malik highlights the potency of anticipation in this reorganized temporality of our political economy, wherein a price in
a future that has not yet happened, is expected, and that future (unknowable) eventuality is operationalized for gains.17 The force of anticipation as it were, isn’t simply
blind chance wagering (and waiting) on what the future will be (analogies to inance
reduced to mere ‘gambling’ are insuicient); it is the very enactment (or forcing)
of anticipation (the investment) that inluences and molds not only the actualization of the future, but transforms the present as well because anticipation imposes
constraints/enablers on existing, current possibilities. What we have here, is what
Esposito identiied as ‘Retrospective Causation’ where efects (actualized futures)
depend on causes, for which they themselves (performatively) operate as causal
agents.18 Armen Avanessian and Malik extend this radical temporal shift outside
of pure inance through to society in general, where their ‘Time-Complex’ model
applies to large-scale, integrated capitalist societies on the whole. The Time-Complex indexes the operationalization of the future on the present, as a condition for
‘judgements, calculations and actions in the present [like] predictive analytics in big
data, derivatives, [and] global supply chains’, setting up an order where the future
precedes the present; where the speculative mode is a socio-technical condition
enabled by computational infrastructures.19 In this temporal order, conventions of
rationality break down, since all quasi-knowledge we may possess is always in the
form of unknowns, as risks — prompting Malik to call for a ‘Risk Rationality’ commensurate with complex societies, wherein we may think the future, but we cannot
know it. This ability to think the future unknown, is the anticipatory; it is the logic of
14
15
16
17
18
19
Elena Esposito, ‘The Construction of Unpredictability’, Fear of Content, Berlin Biennale 9, 2016,
http://bb9.berlinbiennale.de/the-construction-of-unpredictability/.
Ibid.
Ibid.
Armen Avanessian and Suhail Malik, ‘The Time-Complex. Postcontemporary’, Fear of Content,
Berlin Biennale 9, 2016, http://bb9.berlinbiennale.de/the-time-complex-postcontemporary/.
Elena Esposito, The Future of Futures: The Time of Money in Financing and Society, Northampton:
Edward Elgar Publishing, 2011, p. 16.
Suhail Malik, ‘Why a Rationalist Art’, lecture organized by Glass Bead, Les Laboratoires
d’Aubervilliers, Paris, 20 February 2016, http://www.glass-bead.org/audio-research/suhailmalik/?lang=enview.
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the derivative (as a cipher for inance) that has come to deine the distinct operations and causal modalities of our complex societies. This logic of the functioning
of anticipation qua an unactualized future is the enactment of planning (a claim, as
we know, not only on the future, but on the present as well), leading to J.W. Mason’s
insistence on the need to politicize this constitutive quality of inance:
…the inancial system is […] where conscious planning takes its most fully developed form under capitalism. Banks are, in Schumpeter’s phrase, the private equivalent of Gosplan, the Soviet planning agency. Their lending decisions determine what
new projects will get a share of society’s resources, and suspend — or enforce —
the ‘judgment of the market’ on money-losing enterprises.
A socialist program must respond to both these faces of inance. We oppose the
power of inance if we want to progressively reduce the extent to which human life
is organized around the accumulation of money. We embrace the planning already
inherent in inance because we want to expand the domain of conscious choice,
and reduce the domain of blind necessity.20
Such a call to socialize the anticipatory operation of inance is precisely what is captured by an Optimist Realism. It is a complicit position strategically responding to the
causal afordances organising contemporary reality today, to demonopolize (or uncancel) the future (and the present) from the purview of the very few, who are the only
beneiciaries in the design of inance as it is. The call for the socialization of the anticipatory function of inance, must equally assume the politicization of uncertainty itself
as a risk-rationality — for as we know, in any complex system, outcomes are never
fully determinate, but are more aligned with qualities of steering, weighting, and guiding. Furthermore, hijacking the logic of inance for socialized and not private means/
ends also equates with an exit from the logic of scarcity as an economic governing
rational (manifest as austerity). The sheer wealth created in the inancial sector is at
roughly 20 times that of world GDP,21 pointing to an instrumentalized irrationality at
work today. Although operationalizing gains on a quasi ‘openness’ of the future, the
design of inance itself already constrains what those contingent afordances could be,
in line with its molding of individualized proit incentives. Despite the power for futurity
performed in the inancial derivative function, when it is constrained by the interface of
private-gains, it can only ever beneit the few. In this way, the radical contingency of
future unknowns are domesticated, pre and post-emptively coerced into the mold of
‘naturalized’ private interest under capitalist realist afordances; gains made in its own
logical image. If, under inance, our reality has never been more susceptible to ictional
(unactual, anticipatory) procedures, it is time to politicize this mode of efectual retrospective causation and make claims on this operation.
If the contingency of the future has more agency than ever, due to the speculative force
of uncertainty and modes of temporal causation at work in contemporary reality, when
it remains bound to the interfacial paradigm of inance (as it is currently designed),
20 J.W. Mason, ‘Socialize Finance’, Jacobin, 28 November 2016, https://www.jacobinmag.
com/2016/11/inance-banks-capitalism-markets-socialism-planning/.
21 Randy Martin, ‘Dance and Finance — Social Kinesthetics and Derivative Logics’, lecture. EMPAC,
Troy, NY, 9 October 2013, http://empac.rpi.edu/events/2013/fall/other-words/randy-martin.
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our future will remain but beneicial for the (increasingly) few. In his seminal book, The
Stack, Benjamin Bratton deines the interface (beyond the screen-based, button with
words GUI’s we are accustomed to) in the generic, as ‘any point of contact between
two complex systems that governs the conditions of exchange between those systems’ where a ‘diagram plus computation equals interface’.22 Additionally, the interface
can not only make complexity tractable (the problem of complexity withdrawal), fostering interactive accessibility that not only arbitrates translations of signals bidirectionally across disparate domains, but most importantly, where the interface ‘ixes and
limits’ navigational possibility, ‘narrativizing’ the meaning of those very possibilities.23
Because the politics of the interface operate in both directions, there is a potency here
isomorphic to inance-power not to be undervalued; we cannot lose sight of the force
of narrative anticipation, of other ionose sight of th embedding themselves into the
diagramming of those very navigational limits. This, of course, is not to advocate for
‘ideal’ optimism, where we can simply re-narrativize a ‘better world’, as if the stakes
are purely imaginary and plastic, totally susceptible to ictional procedures. Reality is
simultaneously shaped by us, indiferent to us, and invariant to us, and our subsequent
narratives for reverse uptake need to mobilize these constraints. For narrative forces
to politically and substantially engage in the reciprocal dynamics of the interface, they
too must entangle themselves in the reciprocal dynamics between ideality and reality, not as a space of dreamy whimsy, but in ramifying the anticipatory. That is, not
just presenting or narrating what a new, just socio-economic order could be, but in
enacting the anticipation such novel transitions aford as a corresponding onionnting
or nar. The anticipatory, as a mobile uncertain concept is always unknowlable, never
without risk, but always potential. To be sure, this potential is volatile; susceptible to
both utopian and dystopian promises. It conditions the very he veryonthout risk, but
always potential. To be sure, this potentialfuturity can never be an excuse for inertia
nertiaxcuseout risk, bution and social speculation. The future will only ever be contingent and anticipatory; to resign ourselves from its molding otherwise, simply because
we cannot guarantee its outcome, is a pessimistic resignation in denying the mutability
of the given, a conceptual calciication that holds, at present, the guaranteed stagnation of politics under inance power. A pessimism that is only ‘afordable’ by the few
who are not acutely threatened (or may even beneit from) existing interfacial givens.
We need to alienate the naturalized myths of who we are as human creatures (what
incentivizes us as social animals) for reverse up-take, retraining our interfaces for a
mode of futurity premised on collective care, separating from our debilitating narratives
of self-enclosed suiciency.
22 Benjamin H. Bratton, The Stack: On Software and Sovereignty, Cambridge, MA: MIT Press, 2015,
p. 220.
23 Ibid., p. 219.
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References
Arendt, Hannah. On Revolution, New York: Penguin Books, 1963.
Avanessian, Armen and Suhail Malik. ‘The Time-Complex. Postcontemporary’, Fear of Content, Berlin
Biennale 9, 2016, http://bb9.berlinbiennale.de/the-time-complex-postcontemporary/.
Brassier, Ray. ‘The View from Nowhere’, Journal for Politics, Gender and Culture 8.2 (Summer 2011).
Bratton, Benjamin H. The Stack: On Software and Sovereignty, Cambridge, MA: MIT Press, 2015.
Esposito, Elena. The Future of Futures: The Time of Money in Financing and Society, Northampton:
Edward Elgar Publishing, 2011.
_____. ‘The Construction of Unpredictability’, Fear of Content, Berlin Biennale 9, 2016, http://bb9.berlinbiennale.de/the-construction-of-unpredictability/.
Fisher, Mark. Capitalist Realism: Is There No Alternative, London: Zero Books, 2009.
_____. ‘The Slow Cancellation of the Future’, Lecture: MaMa, Zagreb, Croatia, 2014, https://www.youtube.com/watch?v=aCgkLICTskQ.
Malik, Suhail. ‘The Ontology of Finance: Price, Power, and the Arkhéderivative’, in Robin Mackay (ed.)
Collapse Volume VIII, Falmouth: Urbanomic, 2014.
_____. ‘Why a Rationalist Art’, lecture organized by Glass Bead, Les Laboratoires d’Aubervilliers, Paris,
20 February 2016, http://www.glass-bead.org/audio-research/suhail-malik/?lang=enview.
Martin, Randy. ‘Dance and Finance — Social Kinesthetics and Derivative Logics’, lecture. EMPAC, Troy,
NY, 9 October 2013, http://empac.rpi.edu/events/2013/fall/other-words/randy-martin.
Mason, J.W. ‘Socialize Finance’, Jacobin, 28 November 2016, https://www.jacobinmag.com/2016/11/
inance-banks-capitalism-markets-socialism-planning/.
Olma, Sebastian. In Defense of Serendipity: For a Radical Politics of Innovation, London: Repeater
Press, 2016.
Ostry, Jonathan D., Prakash Loungani, and Davide Furceri. ‘Neoliberalism: Oversold?’, Finance and
Development 53.2 (June 2016), http://www.imf.org/external/pubs/ft/fandd/2016/06/ostry.htm.
Rowan, Rory. ‘Extinction as Usual?: Geo-Social Futures and Left Optimism’, e-lux Supercommunity,
(31 July 2015), http://supercommunity.e-lux.com/texts/extinction-as-usual-geo-social-futures-andleft-optimism/.
Stengers, Isabelle. Interviewed by Brian Massumi and Erin Manning, ‘History through the Middle: Between Macro and Mesopolitics’ Inlexions: A Journal for Research-Creation 3 (October 2009), http://
www.senselab.ca/inlexions/volume_3/node_i3/stengers_en_inlexions_vol03.html.
Tucker, Ian. ‘Evgeny Morozov: ‘We are abandoning all the checks and balances’’ The Guardian, 9
March 2013, https://www.theguardian.com/technology/2013/mar/09/evgeny-morozov-technologysolutionism-interview.
Williams, Alex. ‘Complexity & Hegemony’ PhD diss., London: University of East London, 2015.
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NECRO-CAPITALISM
AND
COUNTER-IMAGES
NINA POWER
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NECRO-CAPITALISM AND COUNTER-IMAGES
NINA POWER
We are still looded with images. The images that capitalism has of itself — a series of
never-ceasing electric pulses travelling at light speed across the globe, perhaps — and
the images we have of our relation to it. We might regard ourselves as ‘postcapitalist’
subjects, as citizens, as consumers, as neoliberalized individuals, or as members of
collectives, communes and communities, as members of a religious or ethnic group,
a political party, or as geographical beings, or even as members of a certain kind
of internationalism, global humanism, or cosmic wholeness. It matters a lot how we
understand who we are — as an isolated body, as part of a collective body, as a depressed subject, as a worker, a carer — and it matters how we conceive of ourselves
in relation to broader abstractions that we have no individual control over. Relatedly,
how we respond to the futures that are spoken about in our name, but not necessarily
in the name of everyone, give us an image of what is possible. One of the hardest tasks
before us lies in untangling what particular images of the world mean — which images
of capital come from capital itself, and which from alternatives to it? Which abstractions damage us, and which ofer us images of hope? What should we be mapping and
how should we be acting? Where do our enemies lie — in front of us, or hidden? When
we talk about the future, what are saying we believe in? Dare we talk about the future
when so much of the present lies in ruins around us?
Recent left proposals have called for a strong constructive attempt to bring about certain futures — here automation will replace horrible work, Universal Basic Income will
ensure that no one (or at least those in particular countries) will be absolutely poor and
platforms, from online to governmental, will be taken over by those with a sustainable
plan for the future, against those who seek to exhaust the earth and enslave humanity
in the name of proit for a small few.1 ‘Postcapitalist’ thinkers like Paul Mason attempt
to describe new political subjects, following the death of older images (the proletariat,
above all else): ‘By creating millions of networked people, inancially exploited but with
the whole of human intelligence one thumb-swipe away, info-capitalism has created
a new agent of change in history: the educated and connected human being’.2 These
educated and connected beings lie at one end of the production chain, a kind of canny
consumer. What change might these ‘new agents’ bring about? Must they by necessity forget the routes through which the instruments they swipe come about? Is the
connected human being immune from reactionary ideas, cult-like thinking or hatred?
Franco ‘Bifo’ Beradi identiies three aspects of what he calls the ‘looming war’:
The irst front is the neoliberal power that is tightening its grip of governance, pursuing the agenda of austerity and privatization. The second front is the anti-global
Trumpism based on white resentment and working-class despair. The third front,
1
2
See Nick Srnicek and Alex Williams, Inventing the Future, London: Verso, 2015.
Paul Mason, ‘The End of Capitalism Has Begun’, The Guardian, 17 July 2015, https://www.
theguardian.com/books/2015/jul/17/postcapitalism-end-of-capitalism-begun.
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taking place largely back-stage, is the growing necro-empire of terrorism, in all its
diferent shapes of religious bigotry, national rage and economic strategy, that I
identify as necro-capital.3
Included in this diagnosis is a mixture of governmental power, economic strategy, racial politics, religious impulses, and violence. We are immediately familiar with the
‘war’ that Bifo describes, and we can point to images, forces and activism that directly
seeks to oppose this war with a militant kind of peace: a call for a return to social
democratic politics, re-nationalization of public services, government funding of education; anti-racist politics and the ‘second civil rights movement’ in the form of Black
Lives Matter protests in the US, UK and elsewhere; an endless call for tolerance in the
face of nationalist and religious violence. But what exactly is necro-capital? Elsewhere,
Bifo describes it in the following way:
Neoliberal deregulation has opened the way to a regime of worldwide necroeconomy: the all-encompassing law of competition has cancelled out moral prescriptions and legal regulations. Since its earliest phases, Thatcher’s neoliberal
philosophy prescribed war among individuals. Hobbes, Darwin, and Hayek have
all been summoned to conceptualize the end of social civilization, the end of
peace. Forget about the religious or ideological labels of the agents of massive
violence, and look at their true nature. Take the Sinaloa Cartel and Daesh and
compare them to Blackwater and Exxon Mobil. They have much more in common than you may think. Their common goal is to extract the maximum amount
of money from their investments in the most exciting products of the contemporary economy: terror, horror, and death. Necro-capitalism is the emerging economic order of the world.4
Bifo’s concludes with the stark claim that ‘at the end, suicide’.5 Neoliberalism, itself
based on the resurrection of the Hobbesian ‘war of all against all’, has, according to
Bifo, given way to a necro-neoliberalism that seeks to proit of of excitement in ‘terror, horror and death’.6 There is no doubt that war, drugs, sex, traicking in bodies,
terrorism are extremely proitable. The individual and collective corpses generated
by these trades are sometimes circulated as images if they are deemed both palatable and shocking enough (think of the image of Alan Kurdi, the Syrian Kurdish boy
whose drowned corpse was rendered horribly iconic by international media). But
these images do not seem to generate a political depth but merely a kind of brief,
horriied, sentimental response. Instead of opening houses to refugees, campaigning for open borders and safe passage, Western populations forget about these
images within a matter of days. Necro-capitalism is also the proiting of the images
of the dead, and we can talk about necro-capitalism as a kind of visual ield as well
as an economic tendency. We might also pause here for a moment here and ask a
question that crosses economics and aesthetics — why exactly are ‘terror, horror
3
4
5
6.
Franco ‘Bifo’ Berardi, Futurability: The Age of Impotence and the Horizon of Possibility, London:
Verso, 2017, p. 41.
Franco ‘Bifo’ Berardi, ‘The Coming Global War: Is There Any Way Out?’, e-lux journal 69 (January
2016), http://www.e-lux.com/journal/69/60582/the-coming-global-civil-war-is-there-any-way-out/.
Ibid.
Ibid.
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and death’ exciting? Why are there markets in these emotions and states of being?
How do ictional and real images of violence contribute to the idea made material
that these primal fears and forces are in any way something desirable?
Achille Mbembe’s work on ‘Necropolitics’ has been extremely important for thinking
about the real relationships at the heart of politics. He writes: ‘[i]nstead of considering
reason as the truth of the subject, we can look to other foundational categories that
are less abstract and more tactile, such as life and death’.7 Mbembe, through a reading of Hegel, Bataille and Foucault that centres upon the relationship between politics,
violence and death, points out the central role of slavery in any worthwhile conception
of history: ‘the humanity of the slave appears as the perfect igure of a shadow. Indeed, the slave condition results from a triple loss: loss of a “home”, loss of rights over
his or her body, and loss of political status. This triple loss is identical with absolute
domination, natal alienation, and social death (expulsion from humanity altogether).’8
The slave, Mbembe states, is kept alive, but in a permanent ‘state of injury’.9 Slave
life, Mbembe claims, is a form of ‘death-in-life’. By combining Bifo and Mbembe’s
analyses, we can say that necro-capitalism is not simply the proiting from violence
and terror, but is predicated upon violence and terror, and the entire history of humanity
must be seen in this light if we are to understand how death and life are central to both
aesthetics and economics, no matter how much both pretend to beauty or normality.
I am interested in ways of thinking about an anti-necro-capitalism that, in the irst
place, takes seriously the subjects and the sufering constructed by this kind of economy. I am interested in an aesthetics that recognises the power of violent images, and
refuses to accept that all images are equal. We might be cynical, ‘open to anything and
everything’, be worried about censorship, keep our safe search of, pride ourselves on
our ability to watch graphic violence, to ‘take’ the most violent scenes of murder, rape
and torture, but if we lose the ability to diferentiate between real violence and ictionalized violence, because we have watched too many ilms and played too many games,
then we are easy prey for necro-capitalism. It is diicult to make this argument, though,
without appearing to take a moralistic or censorious approach. Yet, we should remember that we already live online in a world in which we are protected from certain images
by people paid very little: ‘content moderation’ workers for Facebook, largely based in
the Philippines, must see ‘pornography, gore, minors, sexual solicitation, sexual body
parts/images, racism’ and remove these images and texts before users might also
see them.10 The psychological toll of this work is extreme and many of these workers
quickly experience burnout. We may seek out images that horrify and terrorize us, but
many workers do not have this choice.
By recognizing our complicity in the production and reproduction of violent words and
images, we can begin to think and work with care to undoing the lust for pain that sustains necro-capitalism. But how is this possible when so many revolutionary images
are themselves saturated in blood? Perhaps one of the images that most symbolizes
7
8
9.
10
Achille Mbembe, ‘Necropolitics’, trans. Libby Mientjes, Public Culture 15.1 (2003): 14.
Ibid., p. 21.
Ibid., p. 21.
Adrian Chen, ‘The Laborers who keep Dick Pics and Beheadings out of your Facebook Feed’,
Wired, 23 October 2014, https://www.wired.com/2014/10/content-moderation/.
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necro-capitalism is beheading/decapitation — used by IS in their videos in particular
as a warning to Westerners and other Muslims, as well as a recruiting tool for those
whose bloodlust has been triggered. If we concern ourselves with images of beheading — after all, what did peasants do to monarchs, revolutionaries to their enemies —
are we contributing to the same ‘terror, horror and death’ that Bifo identiies as central
to necro-capitalism?
Against the violence of video-taped beheadings, I want to resurrect some ideas of
positive acephalism, of political subjects that begin without heads. Hobbes’s famous
frontispiece to Leviathan, the sovereign head with the multitudinous body, is perhaps
the clearest, and certainly one of the oldest, images we have of the state conceived
of as a literal ‘head’ as well as a metaphorical ‘head’ of state. We know that, or we
are supposed to know that, without the head the body will die. But each person in the
multitude has a head, and none of these will stop working just because the crown has
lost his ‘crown’. In Stasis, Agamben discusses the various historical readings of the
famous frontispiece to Hobbes’s Leviathan (1651), noting that in the manuscript prepared for Charles II, the tiny men that make up the body of the Leviathan were turned
outwards to face the monarch, whereas in the other, main, frontispiece they face upwards towards the head of the sovereign. Both editions, in fact, therefore present the
‘same’ image, just for diferent readers. Pointing out that the Leviathan in the image
appears behind the earth, and possibly in or above the sea, Agamben notes that the
‘mortal-God’ does not then reside in the city but outside it, in a kind of no-man’s-land:
‘The Common-wealth — the body political — does not coincide with the physical body
of the city’.11 The city in the image is also bereft of people, as they are all making up the
body of the sovereign.
These two frontispieces may be 366 years old, but I think it has at least two things
to tell us: one, that we should never be too hasty to give up on ideas of sovereignty
and the state — even when platform and techno-capitalism seems to present us
with models of horizontalism and globalism. States are repressive — the surveillance state, undercover policing, and border control – and privatization and franchising does not diminish the ultimate power of the state. The head in the shape
of the ruling class is a false head, a head that pretends we need it when it is in fact
parasitic upon the body of those who labor. And there are other reasons why decapitation seems so unpalatable. As Freud noted in a short text, ‘Medusa’s Head’ from
1922, simply ‘To decapitate = to castrate’. The fear of decapitation is an intensely
sexed question. As Freud continues: ‘The terror of Medusa is thus a terror of castration that is linked to the sight of something. Numerous analyses have made us
familiar with the occasion for this: it occurs when a boy, who has hitherto been unwilling to believe the threat of castration, catches sight of the female genitals, probably those of an adult, surrounded by hair, and essentially those of his mother’.12
Women, on this analysis, are already decapitated, headless. Why not then assume
the role of the decapitated, the acephalic (and the aphallic!) from the start? What
politics would follow?
11
12
Giorgio Agamben, Stasis: Civil War as a Political Paradigm (Homo Sacer, II, 2), trans. Nicholas
Heron, Edinburgh: University Press, 2015, pp. 27-29.
Sigmund Freud, ‘Medusa’s Head’, 1922.
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The voiceless head, the head that is removed by force: perhaps is there some power
here. How can we take back this always already decapitated and castrated position
from those who would seek to behead us many times over? In Bataille’s ‘Programme
(Relative to Acéphale)’ from 1936, he writes the following: ‘Realize the universal accomplishment of personal being in the irony of the animal world and through the revelation of an acephalic universe, one of play, not of state or duty’.13 The inal point in
the programme says: ‘Airm the value of violence and the will to aggression insofar as
they are the foundation of all power’.14 Understanding the nature of violence, airming
it even, underpins Bataille’s call for a headless universe, one where man war and labour
out of duty, guilt or coercion. Bataille begins with the acceptance of destruction and
violence — ‘Take part in the destruction of the existing world, with eyes open to the
world to come’15 — in a way that might not accord with whatever residual feelings of
paciism, humanism and preservation we might want to hang onto. But, at the same
time, it acknowledges the reality of aggression as a fundamental, perhaps the fundamental feature, of human life. Acephalism, understood as the revelation of a headless
universe, a universe without rules, despite the need of those who wish to lead to invent
them, is a playful, creative endeavour. It loathes the fascist state as much as it loathes
the monarchical state, though is profoundly aware of those forces that can lead to the
former taking hold.
Capital likes to pretend it is acephalic, as if networks are spontaneously generated from
markets, but as austerity has shown us, it needs the state to squeeze those without
money in order to bail out and redirect inance upwards. Capital pretends to hate the
state, but needs it to maintain its own self-image. For many people, the state stripped
of any public aspect, is merely repressive: courts, prisons, borders, refugee camps.
What would it mean to seriously consider removing these apparatuses, of leading a
collective, stateless life? It is necro-capital that makes us immediately conceive of such
a decapitated existence as immediately one of scarcity and violence. But it is necrocapital that constructs the conditions for scarcity and violence, that replicates and
proits from such conditions, from food to images and everything else. What images
do we have of the energy that constitutes such a world? We do not think enough about
how various kinds of energy constitutes our economics and our politics, and how our
images of technological futures, however they are managed (by the state, or by multinational corporations), depend upon presumptions about what energy is and where it
comes from. As Bataille puts it elsewhere:
Man’s disregard for the material basis of his life still causes him to err in a serious
way. Humanity exploits given material resources, but by restricting them as it does
to a resolution of the immediate diiculties it encounters […] it assigns to the forces
it employs an end which they cannot have. Beyond our immediate ends, man’s activity in fact pursues the useless and ininite fulilment of the universe.16
13
14
15
16
Georges Bataille, ‘Programme (Relative to Acéphale)’, The Bataille Reader, Fred Botting and Scott
Wilson (eds), Oxford: Blackwell, 1997, p. 121.
Ibid., p. 121.
Ibid., p. 121.
Georges Bataille, ‘The Meaning of General Economy’, The Bataille Reader, op. cit., 183.
UPDATING DIGITAL ECONOMY
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Is necro-capital an attempt, in the most destructive way possible, to pretend that there
is control over the material basis of our lives? Is it the excess energy generated by
capitalism, fed back into a system that thinks nothing of monetizing pain and slaughter? For Bataille, it is the sun that provides humanity with a model of energy without
exchange (‘The origin and essence of our wealth are given in the radiation of the sun,
which dispenses energy — wealth — without any return’17). Does necro-capitalism proceed under the image of a black sun? We forget the sky too often in our political and
economic analyses, ceding the language of ‘horizons’ to dusty philosophies and the
heavens to religion. If we imagine instead that the sky is our ‘head’, we will not need
leaders with their heads pretending to look down, all the while dealing in the most corrupt things imaginable. Necro-capitalism is a beast of many heads, all of which start to
resemble each other. But they forget where their energy comes from, preferring instead
to dwell in the most destructive impulses. Those of us who do not believe in heads can
nevertheless turn ours to the sky for an image of the world that understands that one
does not need to traic in violence to understand its power.
But we could also turn to another mythical character, another beast with many heads:
the Hydra. As Peter Linebaugh points out:
From the beginning of English colonial expansion in the early seventeenth century
through the metropolitan industrialization of the early nineteenth, rulers referred
to the Hercules-hydra myth to describe the diiculty of imposing order on increasingly global systems of labor. They variously designated dispossessed commoners, transported felons, indentured servants, religious radicals, pirates, urban
laborers, soldiers, sailors, and African slaves as the numerous, ever-changing
heads of the monster. But the heads, though originally brought into productive
combination by their Herculean rulers, soon developed among themselves new
forms of cooperation against those rulers, from mutinies and strikes to riots and
insurrections and revolution.18
The horrors of necro-capitalism, the history of human violence, and the making
economic of horror in slavery and exploitation, are seemingly insurmountable. Yet
we must become better readers of images that neutralize us and make us complicit
in this violence, and look and think instead towards images of alternative worlds
that do not thrive upon and promote violence. Somewhere between acephalism
and the many-headed hydra. This position would not pretend that destructive images and actions do not exist, or must be ignored, but rather understands the
temptation and power of such a vision of the world. We should not seek to protect
ourselves from horrible images, or rely on others to do the hard labour of image
selection, but rather cultivate powerful political images that dialectically reverse
necro-capitalist desires. Aggression may be a central feature of human life, but it
can be addressed if it is understood, and channelled away from cruelty towards
compassion and care.19
17
18
19
Georges Bataille, ‘Laws of General Economy’, The Bataille Reader, op. cit., 189.
Peter Linebaugh and Marcus Rediker, The Many Headed Hydra: Sailors, Slaves, Commoners and
the Hidden History of the Revolutionary Atlantic, Boston, MA: Beacon Press, 2000, pp. 3-4.
Parts of this text draw upon earlier work done for the Amsterdam Sonic Acts festival, 2017.
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References
Agamben, Giorgio. Stasis: Civil War as a Political Paradigm (Homo Sacer, II, 2), trans. Nicholas Heron,
Edinburgh: University Press, 2015.
Bataille, Georges. The Bataille Reader, Fred Botting and Scott Wilson (eds), Oxford: Blackwell, 1997.
Berardi, Franco ‘Bifo’. ‘The Coming Global War: Is There Any Way Out?’, e-lux journal 69 (January
2016), http://www.e-lux.com/journal/69/60582/the-coming-global-civil-war-is-there-any-way-out/.
_____. Futurability: The Age of Impotence and the Horizon of Possibility, London: Verso, 2017.
Chen, Adrian. ‘The Laborers who keep Dick Pics and Beheadings out of your Facebook Feed’, Wired,
23 October 2014, https://www.wired.com/2014/10/content-moderation/.
Freud, Sigmund. ‘Medusa’s Head’, 1922.
Linebaugh, Peter, and Marcus Rediker. The Many Headed Hydra: Sailors, Slaves, Commoners and the
Hidden History of the Revolutionary Atlantic, Boston, MA: Beacon Press, 2000.
Mason, Paul. ‘The End of Capitalism Has Begun’, The Guardian, 17 July 2015, https://www.theguardian.com/books/2015/jul/17/postcapitalism-end-of-capitalism-begun.
Mbembe, Achille. ‘Necropolitics’, trans. Libby Mientjes, Public Culture 15.1 (2003).
Srnicek, Nick and Alex Williams. Inventing the Future, London: Verso, 2015.
UPDATING DIGITAL ECONOMY
EXPERIENCE MONEY
NATHANIEL TKACZ
AND PABLO R. VELASCO
31
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EXPERIENCE MONEY
NATHANIEL TKACZ AND PABLO R. VELASCO
Appiication
Industry researchers and anthropologists in the ‘payment space’ are talking of a ‘Cambrian explosion of payments’.1 The explosion is Cambrian, explains Bill Maurer, ‘in
that new body forms, adaptations of existing structures, and novel relationships in a
variegating ecology of retail payment are coming into being all at once’.2 Readers with
an interest in the payment space are no doubt familiar with some of these ways to pay
(or otherwise transfer), from M-PESA to Venmo, Bitcoin to Alipay, and while not all rely
on the bundle of technologies we (still) call the phone, it is doubtful there would be talk
of such an explosion without the prior explosion of these digital devices.
Part of what is happening with payments is a becoming-money-like of phones, of
phones substituting for other money artefacts such as cash or card. Of course, it is
by no means a straightforward substitution: the becoming-money-like of phones is
equally a becoming-phone-like of money. And since the phone is always already a
bundle or stack of technologies, what is happening with money and what that might
mean more generally in terms of (political) economy is anything but clear.
As Maurer points out, payments made through phones involve ‘adaptations of existing
infrastructures’. Just at the level of phone hardware, for example, he points out how
payment software variously makes use of the phone’s camera, display and earphone
jack, none of which were intended for payment. In addition to these novel material
adaptations, something (at least) as signiicant is happening as money-practices —
paying, transferring, budgeting, converting, investing, and so on — are increasingly
encoded as software. Money is becoming ‘appiied’.
Another way to get at this ‘explosion’ in the payment space is precisely to look to the
major app stores — and indeed one does ind rapid growth in money-related apps
over the last ive years.3 In the form of applications, internet banking services from
Natwest, Barclays or Lloyds (in the UK) sit alongside payment processors such as
Paypal. There are any number of Bitcoin wallets, and the new generation of ‘smart’ or
‘challenger’ banking and payment apps such as Monzo, Monese, or Yolt. Then there
are the 1st party platform apps, such as Android Pay and Google Wallet, or Apple
Pay and Apple Wallet. As a further, fractal, iteration on this platform-app dynamic,
Apple Wallet is also fashioned as its own mini-platform of sorts, a kind of wallet-as-
1
2
3
Bill Maurer, ‘Blockchains Are a Diamond’s Best Friend: Zelizer for the Bitcoin Moment,’ in Nina
Bandelj, Frederick F. Wherry, and Viviana A. Zelizer (eds), Money Talks: Explaining How Money
Really Works, Princeton, NJ: Princeton University Press, 2017, pp. 215–29; Taylor Nelms,
‘“Ecuador Bans Bitcoin”! A Monetary Mix-Up,’ King’s Review Magazine, 20 October 2015, http://
kingsreview.co.uk/articles/ecuador-bans-bitcoin-a-monetary-mix-up/.
Maurer, ‘Blockchains Are a Diamond’s Best Friend’, p. 215.
Of course, both the Apple App Store and Google’s Play Store have experienced signiicant app
growth in general.
UPDATING DIGITAL ECONOMY
33
platform, where users can connect to other apps (British Airways, Starbucks, Hotels.
com, Expedia, Airbnb, Eventbrite, etc.). Wallet will ‘store your boarding passes, tickets, reward cards, coupons and gift cards in one place’.4
These money apps push and pull money in diferent directions. They code its functionality in diferent ways, ways that ‘operationalise’ the sociological theories of money
as ‘marked’ developed by writers like Viviana Zelizer:5 apps for moving money across
borders; for saving and managing inances; for gift-giving; for playful gestures; for
gambling; for retail payments; for speciic platform transactions; for spending in this
space, this store, this thing, now, for you and you only.6 The notion of money as ‘universal equivalent’ is superseded by money as situated, ‘embodied interaction’.7 And
thus, the spectrum of monetary situations become available for appiication. There
is much to be said about monetary appiication: how it reconigures hardware and
infrastructures; how it realigns industries and industry players (banks, mobile network
operators, software companies, merchants and so on), creating new allegiances and
competitors; how it is part of a privatisation of money-space; or, indeed, how it expands money’s materiality and augments its functionality (or not), while blurring the
distinction between money as artefact and process or milieu, for example. In what
follows, we limit ourselves to a discussion of what we see as the becoming experiential
of money; that is, of money becoming subjected to speciic design techniques and
framings as experience. As we shall see, experience (design) informs how the vast
majority of money-related apps are made. It is a way of doing things; a set (or sets)
of principles and corresponding methods. Experience is also the criterion upon which
apps are evaluated and the ‘value proposition’ upon which new apps are brought into
being. A turn to experience, then, helps us understand something of the cultural logics
of this so-called Cambrian explosion. It provides one way into thinking about what is
happening to money as it is remediated through phones, and where we might look to
gain a critical purchase on the present in terms of political and cultural economy.
Experience
While money has long been the subject of design (in terms of materials, preventing
counterfeit, or for symbolic ends), as app the entire money-sphere is subject to a
particular kind of design mediation. Money is becoming a subset of the user experience. Understood through the lens of user experience, money’s commonly-attributed
functions — as medium, measure, store, etc. — persist, but only inasmuch as money
is now also something else. This new experience ‘layer’ of mediation does not cancel
4
5
6
7
As much as Android and Apple Pay have a signiicant competitive advantage as the native
oferings of their respective appospheres, neither has made inroads comparable to their Chinese
counterparts. Alipay, for example, reportedly has 450 million users, and a 54% share of China’s
$5.5 trillion mobile payments market. Alipay’s main competitor is WeixinPay (or WeChat Pay),
which currently has 37% of the market. See Louise Lucas, ‘Ant Financial claims doubling of daily
users’, Financial Times, 17 May 2017, https://www.ft.com/content/8925ad98-3add-11e7-821a6027b8a20f23?mhq5j=e2.
Viviana A. Zelizer, Economic Lives: How Culture Shapes the Economy, Princeton, NJ: Princeton
University Press, 2010; Viviana A. Zelizer, The Social Meaning of Money: Pin Money, Paychecks,
Poor Relief, and Other Currencies, Princeton, NJ: Princeton University Press, 1997.
Wendy Hui Kyong Chun, Updating to Remain the Same: Habitual New Media, Cambridge, MA:
MIT Press, 2016.
Paul Dourish, Where the Action Is: The Foundations of Embodied Interaction, Cambridge, MA: MIT
Press, 2004.
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out other functions, although, as we will see, it is not the case of money-as-usual.
What is experience in this context? There are at least two trajectories that converge
in money-as-experience, one economic and one design-based.
The signiicance of experience as an economic concept was perhaps irst explored
by Alvin Toler in Future Shock.8 Toler wrote of the rise of the ‘experiential industries’, which specialises in neither goods or services but experiences, experiences which in turn becomes central to the mediation of these other sources of value
(goods and services):
Bankers and brokers, real estate and insurance companies will employ the most
carefully chosen decor, music, closed circuit color television, engineered tastes and
smells, along with the most advanced mixed-media equipment to heighten (or neutralize) the psychological charge that accompanies even the most routine transaction. No important service will be ofered to the consumer before it has been analyzed by teams of behavioral engineers to improve its psychic loading.9
Experience, in this regard, pans much of the contemporary ‘culture industries’, and is
always explicitly part of an economic relation. It appears as a kind of extra layer (similar
to how design itself was understood at the time), but Toler also imagines such experiences loating more freely: ‘The experience is, so to speak, the frosting on the cake. As
we advance into the future, however, more and more experiences will be sold strictly
on their own merits, exactly as if they were things’.10
Roughly 30 years after Future Shock, Joseph Pine and James Gilmore wrote their inluential book, The Experience Economy.11 These authors similarly distinguish experience
from goods and services:
Experiences represent an existing but previously unarticulated genre of economic
output. Decoupling experiences from services in accounting for what businesses
create opens up possibilities for extraordinary economic expansion just as recognizing services as a distinct and legitimate ofering led to a vibrant economic foundation in the face of a declining industrial base.12
For these authors, experience is separated out as a new ‘unit of value’, which emerges through ‘mass customization’ and where ‘every business is a stage, and therefore work is theatre’.13 Mass customization is achieved through diferent forms of
‘staging’. If this sounds like an operationalization of Erving Gofman’s seminal Frame
Analysis — where theatre is used as a primary example to elucidate the ‘framing’ of
everyday experience — it is because it is.14 The Experience Economy reads like a
8
9
10
11
12
13
14
Alvin Toler, Future Shock, New York: Bantam Books, 1970. p. 226.
Ibid., p. 228.
Ibid.
B. Joseph Pine and James H. Gilmore, The Experience Economy: Work Is Theater & Every
Business a Stage, Brighton: Harvard Business School Press, 1999.
Ibid.
Ibid.
Erving Gofman and Bennett Berger, Frame Analysis: An Essay on the Organization of Experience,
New Edition, Boston, MA: Northeastern University Press, 1986.
UPDATING DIGITAL ECONOMY
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business undergraduate mistakenly took a course in sociology, and read Gofman
as if he were a business guru. The result is employees and managers reimagined
as actors and places of work reimagined as diferent types of theatre. Find yourself
in a dynamic environment? Strategy: Improv Theatre. How about a familiar, routine
situation? Platform Theatre. As industrial production retreats from the overdeveloped
nations and services reach their limits, the staging of experiences, Pine and Gilmore
suggest, ‘provides the key to future economic growth’.15
By the time The Experience Economy was reissued in 2011, the authors could write
of Apple as the new masters of experience: ‘what store is now the envy of every mall
owner and developer? Apple. Why? Customers clearly lock there not only for the
goods but also the store experience…’.16 A year after this reissue, Carmine Gallo
published her book length account of this development in The Apple Experience.17
Gallo continues to rely on theatrical metaphors, with discussions of scripts and stage
setting, heroes and villains, but also give experience an expanded set of coordinates.
In a chapter dedicated to creating ‘wow moments’, for example, readers are treated
to an opening epigraph from neuroscientist John Medina: ‘The brain remembers the
emotional components of an experience better than any other aspect’.18 The staging
of experiences comes to refer explicitly to a cognitive and emotional actor, with the
task of experience design, in this chapter at least, to create ‘emotionally charged
events’. Apple’s famous Super Bowl ad ‘1984’ is reframed as the prototypical ‘wow
moment’. Whatever else there is to say about this ad, it certainly can be read as a
kind of experience proposition (as the voiceover proclaims): ‘And you’ll see why 1984
won’t be like 1984’.19
It is with Apple that the two trajectories of experience as designed encounter and
source of economic value reach their apotheosis. Of course, experience as ‘unit of value’ and as design practice are deeply interwoven, but they can be separated out. Designing for ‘the user experience’20 is precisely a practice, a way of designing that difers
from other design traditions, and one in which economic considerations (of experience)
become backgrounded and only re-enter at speciic moments of the design process.
User experience (UX) design falls within what has been called the ‘third paradigm’
of Human-Computer Interaction (HCI) as inluentially described by Steve Harrison,
Deborah Tatar, and Phoebe Sengers.21 These authors summarise the irst paradigm
as engineering and ‘human factors’ led, with a focus on ‘optimizing man-machine
it’; the second was based in cognitive science and focusing on how the computer
B. Joseph Pine and James H. Gilmore, The Experience Economy, Updated Edition, Boston, MA:
Harvard Business Review Press, 2011.
16 Pine and Gilmore, The Experience Economy.
17 Carmine Gallo, The Apple Experience: Secrets to Building Insanely Great Customer Loyalty, New
York, NY: McGraw-Hill Education, 2012.
18 Ibid., 143.
19 Ridley Scott, Apple - 1984, https://www.youtube.com/watch?v=R706isyDrqI.
20 Jesse James Garrett, Elements of User Experience: User-Centered Design for the Web, 1st edition,
Indianapolis, IN: New Riders, 2002.
21 Steve Harrison, Deborah Tatar, and Phoebe Sengers, ‘The Three Paradigms of HCI’, SIGCHI
Conherence on Human Factors in Computing Systems, San Jose, CA, 2007, https://www.
researchgate.net/publication/215835951_The_three_paradigms_of_HCI.
15
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and ‘human mind’ interact; while the third paradigm is described as a ‘phenomenological matrix’, one which takes into account things like afect, embodiment, situated meaning, values and social issues.22 In a diferent take on this history, Microsoft
researcher Jonathan Grudin deines the third ‘face’ (in his terms) through the rise
of ‘discretionary use’.23 His idea correlates with the rise of the PC (and later mobile
devices), which place computers outside the workplace and the practice of work
itself. Discretionary use is use beyond work; use that, at least in some aspects, is
reconigured as consumption.24
Research under the ‘third paradigm’ attained heightened inluence as computational objects increasingly entered the everyday – the becoming ‘ubiquitous’ of
computing.25 Pioneering work by HCI researchers at Xerox PARC, including Lucy
Suchman on ‘situated action’ and Paul Dourish on ‘embodied interaction’, ofered
convincing criticisms of the instrumental and Cartesian underpinnings of earlier approaches to HCI, while also drawing on sociological and phenomenological insights
to advance their own agendas.26 Donald Norman, who was foundational to the second ‘cognitive’ paradigm of HCI, revised his earlier position and also began focusing on things like ‘emotional design’.27 In this third paradigm, the user of technology
was thoroughly reworked; now depicted in situations closer to Geertz’s Balinese
Cockights than the formalised cognitive task and oice worklows of days past.28
The term ‘user’ itself came under attack by Norman and others as being too tainted
by these older paradigms. Norman started championing ordinary ‘people’ and suggesting technology ‘should get out of the way’ — the so-called invisible paradigm
— while others suggested UX should lose its ‘U’ and focus solely on experiences.
So, users and situations become decidedly thicker, and claims to knowing the user
attained new empirical coordinates. Users were now placed in ‘user scenarios’
within larger ‘user journeys’; they were now in a world full of rich experiences and
the task of design was to focus on these. Even when ‘real’ users were missing in action, designers invented detailed but efectively ictitious characters or ‘personas’.
While products and services remain important throughout these changes, experience design begins from this position (of experience) and works backwards through
to the product or service.
Drawing insights from behavioural psychology, cognitive approaches to interaction design had already assumed users were not rational and this assumption was
carried into the experience paradigm. It’s not to say that cognitive approaches
22 Harrison, Tatar, and Sengers, ‘The Three Paradigms of HCI’.
23 Jonathan Grudin, ‘Three Faces of Human — Computer Interaction’, IEEE Annals of the History of
Computing 27.4 (October 2005): 46–62.
24 Soren Bro Pold and Christian Ulrik Andersen, ‘Controlled Consumption Culture: When Digital
Culture Becomes Software Business,’ in Paul D. Miller and Svitlana Matviyenko (eds), The
Imaginary App, Cambridge, MA: MIT Press, 2014, pp. 17–34.
25 Mark Weiser, ‘Ubiquitous Computing,’ Ubiquitous Computing, 2017, http://www.ubiq.com/
hypertext/weiser/UbiHome.html.
26 Lucy A. Suchman, Plans and Situated Actions: The Problem of Human-Machine Communication,
Cambridge: Cambridge University Press, 1985); Dourish, Where the Action Is.
27 Donald Norman, Emotional Design: Why We Love (or Hate) Everyday Things, New York, NY: Basic
Books, 2005.
28 Cliford Geertz, The Interpretation of Cultures, New Ed edition, New York, NY: Basic Books, 1977.
UPDATING DIGITAL ECONOMY
37
presumed an irrational user, but rather a full spectrum of cognitive ‘behaviours’
were put on the table. Indeed, the very premise of the second paradigm was that
designers and engineers could not assume in advance that users would use as
intended by design; Engelbart-style ‘augmenting’ of the human intellect through
the interface was not a given.29 Industry books like Don’t Make Me Think30 and
Designing with the Mind in Mind31 provided practical advice on designing for the
cognitively-lawed user.
This a-rational or behavioural user underpins much contemporary interaction design, where creating a desired experience is evaluated in terms of its capacity to
elicit speciic behaviours. Here, the design of experience to shape behaviour explicitly blends socio-cultural, psychological and behavioural-economic insights, as
seen in the well-documented form of ‘nudging’.32 The most sinister of the cognitivebehavioural approaches at the level of experience design are manifested as ‘dark’
design patterns, which deliberately aim to trick and misguide users by preying on
their cognitive weaknesses.33 However, deliberate attempts to nudge and deceive
are only the most obvious instances of experiences that are always already designed to direct cognition.
Thus, while there is a thickness to the imagined, designed and real experiences of
the user, a lingering instrumentality necessarily exists in the user experience as subject of design. Experiences are designed to ‘act upon’ the user to enact a change or
achieve a designed outcome. While cognition is not the only target of design, as the
locus of decision-making and other, lower-level responses,34 the cognitive element is
often privileged. The behavioural economists, for example, are now inclined to speak
of designing ‘choice architectures’, material environments constructed to encourage
speciic choices (over others), while also producing an active, decision-making user – a
user understood as decision-maker, and one who must decide in order to validate the
premise of the (choice) architecture.
This cognitive-behavioural user has its roots in behavioural psychology, where the
mind or psyche were black-boxed. The psychological way of knowing came to revolve
around creating controlled experiments, which focused on observing the cognitive behaviours of subjects.35 This black-boxing of the mind and privileging of a peculiar form
of empiricism proved attractive to a generation of economists who had become interested in testing the presumed utility-maximising individual underpinning neoclassical
29 Douglas C. Engelbart, ‘Augmenting Human Intellect: A Conceptual Framework,’ Doug Engelbart
Institute, 1962, http://www.dougengelbart.org/pubs/augment-3906.html.
30 Steve Krug, Don’t Make Me Think!: A Common Sense Approach to Web Usability, 2nd edition,
Berkeley, CA: New Riders, 2005.
31 Jef Johnson, Designing with the Mind in Mind: Simple Guide to Understanding User Interface
Design Rules, 1st edition, Burlington, MA: Morgan Kaufmann, 2010.
32 Cass R. Sunstein and Richard H. Thaler, Nudge: Improving Decisions About Health, Wealth and
Happiness, London: Penguin, 2012.
33 See D. Berry and M. Dieter (eds), Postdigital Aesthetics: Art, Computation And Design, 2015
edition, New York, NY: Palgrave Macmillan, 2015; Harry Brignull, ‘Dark Patterns’, 2017, https://
darkpatterns.org/.
34 See Daniel Kahneman, Thinking, Fast and Slow, London: Penguin, 2012.
35 John A. Mills, Control: A History of Behavioral Psychology, New York, NY: NYU Press, 2000.
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economics and they used experiments to undermine this rational igure at the heart
of economics.36 Such a black-boxing of the mind attains a new speciicity and a new
function in the experience paradigm.
While the process of design may well involve qualitative or even ethnographic modes
of inquiry, the actual interfacing of user and experience, when people use money
apps, for example, lends itself to behavioural insights (and methods) because the
actual user is generally only registered as a series of digital traces. That is, while the
user may be ‘in’ an experience in all its symbolic richness, the interaction is fed back
through the interface as a string of data signals.37 While early web design was barely
conscious of the ‘informating’38 dimension of digital communication, today experiences come jam-packed with any number of behavioural data points and these are
used to measure the performance of the experience (in terms of conversion rates,
for example), but also as a set of coordinates for conducting experiments.39 A/B and
multivariate testing, which roll out subtly diferent versions of an interface to diferent users and then measure the resulting behaviours against a predeined criteria,
are based precisely on the experience as an unfolding experiment, and as constituted through behaviours which are not only the basis of ‘knowing’ but also acting.
This post-ethnographic and post-demographic40 user (as data signals) moves to the
centre of design considerations as the actual users of applications scales into the
millions. Indeed, as initially designed experiences (and their ethnographically thick
users) are set wild into the digital everyday, the scaling of behavioural data and reframing of experience as experiment suggest the third paradigm may be morphing
into something else. These hybrid experiements, increasingly form the modus operandi of innovation in platform capitalism. In the case of data-driven experiments,
we are literally talking about quasi-blind innovation. A data-design hybrid authority
replaces the Schumpeterian heroic entrepreneur. The experience economy is guided
by the invisible hand of behaviour.
The Cambrian explosion in the ‘payments space’ is an implosion of money as exchange and a rebirth of money as experience. Experience becomes a distinct value
proposition — indeed, a selling point — upon which any number of money-sphere
applications can lay claim. Experience is staging, performance, scripting, instrumentalized Gofmanian framing; it is a new ‘unit of value’, a 1984 ‘wow moment’. But it is
also a worldview of ethnographic thickness attached to design practice. Experience is
where people are (embodied, situated), what they have (afects, emotions, behaviours)
and what design actively (re)creates, acts upon and experiments on; experience hovers
between methodology and worldview.
36 Richard H. Thaler, Misbehaving: The Making of Behavioural Economics, 1st edition, London:
Penguin, 2015; Daniel Kahneman, Thinking, Fast and Slow; Floris Heukelom, Behavioral
Economics: A History, Cambridge: Cambridge University Press, 2014.
37 Frieder Nake, ‘Human-Computer Interaction: Signs and Signals Interfacing,’ Languages of Design
2, 1994, pp. 193–205.
38 Shoshana Zubof, ‘Big Other: Surveillance Capitalism and the Prospects of an Information
Civilization’, Journal of Information Technology 30.1 (March 2015): 75.
39 Gary Angel, Measuring the Digital World: Using Digital Analytics to Drive Better Digital Experiences,
1st edition, Upper Saddle River, NJ: Pearson FT Press, 2015; Zubof, ‘Big Other: Surveillance
Capitalism and the Prospects of an Information Civilization’.
40 Richard Rogers, Digital Methods, Cambrige, MA: MIT Press, 2013.
UPDATING DIGITAL ECONOMY
39
Apple Pay
To consider this recasting of money as experience, let’s return to Apple. Apple Pay
was publicly introduced at the launch event for the iPhone 6 in 2014. After a general introduction to the then new iPhone 6, Apple CEO Tim Cook strolls (back) onto
the stage and announces that he’d ‘like to talk about an entirely new category of
service’.41 After a lengthy pause, he continues, ‘And it’s all about the wallet’. A bulky
black leather wallet appears on the screen behind Cook; it is held slightly ajar to
reveal a couple of bank cards and some unruly bills. ‘Our vision’ he continues, ‘is to
replace this.’ Apple Pay is presented as the irst step in this vision. The audience is
given an overview of the payments industry in the US (four trillion US dollars annually,
200 million transactions processed daily), after which Cook’s rhetoric takes a turn:
‘That’s 200 million times we scramble for our credit cards, and go through what is
a fairly antiquated payment process’. He provides a short and somewhat elaborate
video of a woman paying for a store purchase using a Visa bank card: she fumbles
around with her purse; the card is diicult to pry out of its slot; ID is required; the
magstripe doesn’t read; the card is returned with a receipt, and both need to be
sorted away. The bank card — and its magstripe technology — come under full attack: it’s ‘ive decades old’; ‘outdated and vulnerable’; ‘it’s so easy to lose your card
or have it compromised’.
Cook goes on to acknowledge that many have already tried and failed to create a mobile wallet which gains a foothold in the payment business. ‘Why is this?’, he ponders,
It’s because as it turns out most people that have worked on this have started by
focusing on creating a business model that was centred around their self-interest,
instead of focusing on the user experience. We love this kind of problem. This is
exactly what Apple does best.
The audience is reintroduced to the scenario of the woman paying in store. This
time she is equipped with Apple Pay. At the register, the store keeper once again announces the total. The woman holds her phone to a wireless payment terminal and
presses her thumb on the iPhone’s ingerprint scanner. A small beep conirms the
transaction is complete. ‘That’s it!’, Cook announces. And again, ‘That’s it!’ He shows
the video again, in case the audience ‘blinked’ and missed it. At that point, Cook
leaves the stage to Eddy Cue (Senior VP of Software and Services) to go through all
the technical details. While these details surely matter a great deal when it comes to
evaluating the actual functioning of Apple Pay, the main work is already done. ‘That’s
it’ is Apply Pay’s ‘wow moment’.
In the irst video Cook establishes payment as a theatre of experience. It is a woman in a store, with a handbag and a purse. It is a shopkeeper, a bench, goods and
bags, swipe terminals and cash registers. It involves communication, both verbal
and gestural, and a range of bodily movements — grasping, sorting, swiping, pulling, glancing, reading, and so on. Swipe cards appear as the main villains, sup-
41
Apple, Apple - September Event 2014, 2014, https://www.youtube.com/watch?v=38IqQpwPe7s;
Note: all subsequent references to Tim Cook are taken from this video. The relevant section
begins at the 43-minute mark.
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ported by purses, swipe terminals and ID checks. Apple Pay emerges as the understated hero; it rewrites the script, taking the user on a new, simpler journey.
We will not speculate too much on the strategic behavioural dimensions of this rescripted experience, but the temporal changes alone — That’s it! — is presumably
relevant to the so-called purchase or conversion ‘funnel’, particularly at the inal point
of purchase. It would also presumably impact the user’s ‘present bias’ (a privileging of the present when making decisions), by reducing opportunities for consumer
relexivity. Such speculation is in fact not necessary as Apple overtly advertises the
behavioural dimensions of Apple Pay on the company’s developer site, where early
adopters provide testimony of the beneits of switching to Pay.42 Consider a selection
of these testimonies:
A product manager from Groupon: ‘Apple Pay has facilitated greater real-time commerce, improved conversion and enhanced the overall Groupon mobile experience.’
A product director from Indiegogo: ‘We’ve seen a 250% increase in our conversion
rate with Apple Pay.’
A ‘VP of Product’ from Chairish: ‘With Apple Pay, our conversion rate has tripled.’
The CEO of Fancy: ‘Apple Pay customers have a 30% higher purchase frequency
than other users.’
Each of these testimonies is followed with further elaboration from Apple’s copy writers: ‘new customers can purchase a deal with a single tap’; ‘the DoorDash team removed friction from the checkout experience for new users’; ‘With Apple Pay, there’s
no need for payment method selection or data entry, resulting in an optimal customer
experience’; and ‘With a better irst time experience, customers come back more frequently.’ The ‘value proposition’ of Apple Pay is an improved payment experience
resulting in higher sales conversion rates. That is, as experience money, Apple Pay
promises to leave its owners hands (or phones?) more often and more eiciently than
other ways to pay.
Critical Coordinates
Whether or not Apple Pay (Android Pay, Samsung Pay, Alipay, WeChat Pay, Paypal,
or the like) will establish itself as the killer app for payments is secondary to the general rise of experience money. Competition in the payment space and the larger app
ecology is being forged in terms of this re-scripting of experience. What to make of
this experience money?
Experience money should trouble classical and neoclassical economists because it
introduces a behavioural, a-rational, actor into the market, a priori. That is, experience money acts on users through the very process of facilitating market activity. The
behavioural approach to economics also inds itself in an odd situation: the insight it
42
Apple. ‘Apple Pay - Apple Developer’, https://developer.apple.com/apple-pay/; Note: all
subsequent testimonials are taken from this page.
UPDATING DIGITAL ECONOMY
41
borrows from behavioural psychology to better account for empirical economic activity (with regards to neoclassical approaches) is now already written into the empirical.
Attempts to explain economic realities from this position therefore sufer from a type
of ontological circularity. In other words, behavioural economics is having its ‘engine
not a camera’ moment.43 This should not trouble too many readers of MoneyLab,
who hail from more critical and creative horizons. Indeed, it suggests the empirical
realities of experience money can be used as ammunition against attempts to explain
economic activity by the means just mentioned. But we might also ask some more
fundamental questions.
As Apple, Google, Alibaba, Tencent and others continue the march into banking, payment, transfer and other services traditionally the preserve of banks and credit card
companies, the distance between global inance and digital cultures further collapses.
What would it mean to take these players and their experiential interventions as the
basis for a critique of political economy? When four of the top ive most valuable public
companies (Apple, Alphabet, Microsoft and Amazon) are all experimenting with experience money, this question is pressing. What does criticism look like, when its object
is an economy of experiences? What can we learn from these experience-mongers?
Future interventions must learn from and act upon this experiential state of the art.
References
Angel, Gary. Measuring the Digital World: Using Digital Analytics to Drive Better Digital Experiences, 1st
edition, Upper Saddle River, NJ: Pearson FT Press, 2015.
Apple, Apple - September Event 2014, 2014, https://www.youtube.com/watch?v=38IqQpwPe7s.
_____. ‘Apple Pay - Apple Developer’, https://developer.apple.com/apple-pay/.
Berry, D. and M. Dieter (eds), Postdigital Aesthetics: Art, Computation And Design, 2015 edition, New
York, NY: Palgrave Macmillan, 2015.
Brignull, Harry. ‘Dark Patterns’, 2017, https://darkpatterns.org/.
Chun, Wendy Hui Kyong. Updating to Remain the Same: Habitual New Media, Cambridge, MA: MIT
Press, 2016.
Dourish, Paul. Where the Action Is: The Foundations of Embodied Interaction, New Ed edition, Cambridge, MA: MIT Press, 2004.
Engelbart, Douglas C. ‘Augmenting Human Intellect: A Conceptual Framework,’ Doug Engelbart Institute, 1962, http://www.dougengelbart.org/pubs/augment-3906.html.
Harrison, Steve, Deborah Tatar, and Phoebe Sengers, ‘The Three Paradigms of HCI’, SIGCHI Conherence on Human Factors in Computing Systems, San Jose, CA, 2007, https://www.researchgate.net/
publication/215835951_The_three_paradigms_of_HCI.
Gallo, Carmine. The Apple Experience: Secrets to Building Insanely Great Customer Loyalty, New York,
NY: McGraw-Hill Education, 2012.
Garrett, Jesse James. Elements of User Experience: User-Centered Design for the Web, 1st edition,
Indianapolis, IN: New Riders, 2002.
Geertz, Cliford. The Interpretation of Cultures, New Ed edition, New York, NY: Basic Books, 1977.
Gofman, Erving and Bennett Berger. Frame Analysis: An Essay on the Organization of Experience, New
edition, Boston, MA: Northeastern University Press, 1986.
Grudin, Jonathan. ‘Three Faces of Human -- Computer Interaction.’, IEEE Annals of the History of
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Floris Heukelom, Behavioral Economics: A History, Cambridge: Cambridge University Press, 2014.
Johnson, Jef. Designing with the Mind in Mind: Simple Guide to Understanding User Interface Design
43
Donald Mackenzie, An Engine, Not a Camera: How Financial Models Shape Markets, Cambridge,
MA: The MIT Press, 2008.
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Rules, 1st edition, Burlington, MA: Morgan Kaufmann, 2010.
Kahneman, Daniel. Thinking, Fast and Slow, London: Penguin, 2012.
Krug, Steve. Don’t Make Me Think!: A Common Sense Approach to Web Usability, 2nd edition, Berkeley,
CA: New Riders, 2005.
Lucas, Louise. ‘Ant Financial claims doubling of daily users’, Financial Times, 17 May 2017, https://
www.ft.com/content/8925ad98-3add-11e7-821a-6027b8a20f23?mhq5j=e2.
Mackenzie, Donald. An Engine, Not a Camera: How Financial Models Shape Markets, Cambridge, MA:
The MIT Press, 2008.
Maurer, Bill. ‘Blockchains Are a Diamond’s Best Friend: Zelizer for the Bitcoin Moment,’ in Nina Bandelj,
Frederick F. Wherry, and Viviana A. Zelizer (eds), Money Talks: Explaining How Money Really Works,
Princeton, NJ: Princeton University Press, 2017.
Mills, John A. Control: A History of Behavioral Psychology, New York, NY: NYU Press, 2000.
Nake, Frieder. ‘Human-Computer Interaction: Signs and Signals Interfacing,’ Languages of Design 2,
1994.
Nelms, Taylor. ‘“Ecuador Bans Bitcoin”! A Monetary Mix-Up,’ King’s Review Magazine, 20 October
2015, http://kingsreview.co.uk/articles/ecuador-bans-bitcoin-a-monetary-mix-up/.
Norman, Donald. Emotional Design: Why We Love (or Hate) Everyday Things by Norman, Don, New
York, NY: Basic Books, 2005.
Pine, B. Joseph and James H. Gilmore. The Experience Economy: Work Is Theater & Every Business a
Stage, Brighton: Harvard Business School Press, 1999.
Pold, Soren Bro and Christian Ulrik Andersen. ‘Controlled Consumption Culture: When Digital Culture
Becomes Software Business’, in Paul D. Miller and Svitlana Matviyenko (eds), The Imaginary App,
Cambridge, MA: MIT Press, 2014.
Rogers, Richard. Digital Methods, Cambrige, MA: MIT Press, 2013.
Scott, Ridley. Apple - 1984, https://www.youtube.com/watch?v=R706isyDrqI.
Suchman, Lucy A. Plans and Situated Actions: The Problem of Human-Machine Communication, Cambridge: Cambridge University Press, 1985.
Sunstein, Cass R. and Richard H. Thaler. Nudge: Improving Decisions About Health, Wealth and Happiness, London: Penguin, 2012.
Thaler, Richard H. Misbehaving: The Making of Behavioural Economics, 1st edition, London: Penguin,
2015.
Toler, Alvin. Future Shock, New York, NY: Bantam Books, 1970.
Weiser, Mark. ‘Ubiquitous Computing,’ Ubiquitous Computing, 2017, http://www.ubiq.com/hypertext/
weiser/UbiHome.html.
Zelizer, Viviana A. The Social Meaning of Money: Pin Money, Paychecks, Poor Relief, and Other Currencies, Princeton, NJ: Princeton University Press, 1997.
_____. Economic Lives: How Culture Shapes the Economy, Princeton, NJ: Princeton University Press,
2010.
Zubof, Shoshana. ‘Big Other: Surveillance Capitalism and the Prospects of an Information Civilization’,
Journal of Information Technology 30.1 (March 2015).
BLOCKCHAIN CRITICISM
BLOCKCHAIN AND
THE DISTRIBUTED
REPRODUCTION OF
CAPITALIST CLASS
POWER
ROBERT HERIAN
43
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BLOCKCHAIN AND THE DISTRIBUTED REPRODUCTION
OF CAPITALIST CLASS POWER
ROBERT HERIAN
Discussing computer operating systems, the economist Joseph Stiglitz argues that,
‘Just as it’s very convenient for everyone to speak the same language, it’s very convenient for everyone to use the same operating system’.1 There’s a simple and plain
truth in what he says. And in what can now be seen as a clear echo of the prevailing trend in Distributed Ledger Technology (DLT), or blockchain research, as well as
development of the back of inancial technologies markets towards multi-domain
usages, Stiglitz continues by suggesting that, ‘[i]ncreasing interconnectivity across
the world naturally leads to standardisation. Those with a monopoly over the standard that is chosen beneit’.2 Blockchain may not presently be a standard owned or
intellectually controlled by a single economic actor, but there are certainly a growing
number of consortia made up of major legacy inancial and tech players hoping to
beneit from it. But will this remain the case in the near future, and does it really matter if the development of blockchain technology ends up under the control of, say,
one tech giant?
In a very short space of time, arguably the last three to ive years, blockchain has
risen to capture the feverish imagination of capitalists and entrepreneurs alike across
the globe. There is now a morass of such players scrambling over one another in
ierce competition to be the winners in this latest round of onanistic technological
innovation. Fuelled almost exclusively by hyperbole and, contrary to the nature of the
technology itself, a gradual centralization and aggregation of peripheral technological
practices that is a direct result of the inluence of capitalist logic, blockchain is rapidly
emerging as a proitable mainstream means for generating the surplus interventions,
accumulations, exploitations and reproductions demanded by the capitalist imagination. Under the duel banners of ‘innovation’ and ‘progress’ blockchain has become the means du jour for the reproduction of capitalist class power through ‘world
changing’ technology in the so-called fourth-industrial age in which advanced Western capitalist societies now imagine themselves.3 And the forward thrust of blockchain innovation is furious, with record levels of investment as of 2016/17 measured
in billions of dollars of venture capital.4
1
2
3
4
Joseph E. Stiglitz, The Price of Inequality, London: Penguin, 2013, p. 56.
Ibid., p. 56.
For some commentators it is less an ‘age’ and more another industrial revolution. For example,
Klaus Schwab, the founder and executive chairman of the World Economic Forum. See Klaus
Schwab, The Fourth Industrial Revolution, New York, NY: Crown, 2017.
See James Ovenden, ‘Blockchain Top Trends in 2017: What Lies Ahead for One of the World’s
Most Exciting Technologies?’, The Innovation Enterprise, 29 November 2016, https://channels.
theinnovationenterprise.com/articles/blockchain-top-trends-in-2017.
BLOCKCHAIN CRITICISM
45
Capital and ‘Disruptive’ Innovation: An Entrepreneurial Love Afair
The issue of blockchain as a means of reproducing capitalist class power does not
begin (or end for that matter) with the technology itself but with people. Those who
engineer and build the technology might care about blockchain solely as an intellectual challenge. The extent to which it is possible to separate those who, for instance,
engineer a piece of software or build a platform from those who seek to exploit the
technology (for the purposes of not simply generating personal fortunes in the short
to medium term but also for the sheer thrill of the process of being an active economic subject) becomes less clear when they are one and the same person, namely
a so-called tech entrepreneur. For this cabal of tech-minded libertarians and anarchocapitalists blockchain technology ofers an opportunity to leverage new markets and
enable, as David Golumbia argues, ‘a wide range of extractive and exploitative business practices’ that ultimately ‘increase the power of corporations and capital outside
the scope of any attempts by democratic polities to constrain them’.5 When discussing
technology it is easy to forget the people behind it. Likewise, it is easy for those selfsame people to hide behind the technology and ultimately use it to both facilitate and
conceal their desires and motivations. Desires that can be markedly diferent from
those to which the technology appears to be aimed — or, at least, towards which they
tell the world the technology is aimed.
A single basic technological form with many diferent uses is the Holy Grail of technological innovation in engineering terms. Just as Stiglitz suggests in the quote earlier.
But the economics of these innovations make happy reading for many as well. The
reason is simple. If you don’t need to spend time or money changing technology to
make it it multiple applications then you are likely to have the gift of a technological
‘organizational form’ that is highly cost-efective and organizationally eicient.6 It is
trite these days to highlight capital’s insistence on superseding the old with the new,
whether via material obsolescence or some other form of cynical immaterial manipulation of one’s personal and subjective desires (advertising, marketing etc.). We must
recognise what the process of making way for (or forcing) the new represents in this
context however: a deeply ideological and often highly cynical process that determines
the accrual of beneits into only a few sets of hands, and the onward march of capitalist
class power through the creation of a constant tension between (supposed) problems
and (necessary) solutions.
Much like the comic plotlines of the hit HBO comedy Silicon Valley, entrepreneurial
narratives of progress and innovation are fraught with fanciful thinking and dreamlike logic that see problems as always already indexed to solutions and vice versa,
ad ininitum. Central to the reproduction of capitalist class power on this score is the
necessity of a call to duty of individuals willing to play the game of problem versus solution. Akin to Louis Althusser’s interpellated economic subjects, entrepreneurs don’t
just answer this call (the hail) made by capitalism, however; they locate their object
of desire in the internal reason and (il)logic of capital. Entrepreneurs fall in love with
5
6
David Golumbia, The Politics of Bitcoin: Software as Right-Wing Extremism, Minneapolis, MN:
University of Minnesota Press, 2016, p. 69.
David Harvey, Seventeen Contradictions and the End of Capitalism, London: Proile Books, 2015,
p. 92.
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innovation, they enjoy the promise of it, and it becomes their ‘passion’.7 As such they
tell themselves that ideas not income are important, whilst searching, via a cycle of
success and failure, for the one big idea that will secure their fortune.8
For entrepreneurs and capitalists alike the aim is always to unearth innovations and
technologies that ‘disrupt’, which are capable of creating more competition and markets. Blockchain is a prime example of just such a ‘disruptive’ technology, hence why
it forms the latest chapter in the enduring love story between capital and innovation.
But it is important not to confuse technology with innovation. The latter ‘is what capitalism consists in and what every capitalist concern has got to live in’.9 Innovation,
like progress, is rooted in historical contingency and narratives of power. ‘The idea
of innovation is the idea of progress stripped of the aspirations of the Enlightenment,
scrubbed clean of the horrors of the twentieth century, and relieved of its critics’, says
Jill Lepore, ‘[d]isruptive innovation goes further, holding out the hope of salvation
against the very damnation it describes: disrupt, and you will be saved’.10
Let’s be honest, however: what passes for technological revolution and disruption are
entirely vacuous notions in many of the contexts in which they are celebrated. First
and foremost, because nothing actually is disrupted by them. Instead the so-called
disruptive technologies sustain and reinforce the status quo. In my book, disruption
is, a lot of the time, radically conservative. Why? Simply because the economic base
(infrastructure) of capitalism, the very reason why the technology is developed and
deployed in the irst place, always remains unchanged when exposed to the supposed cosmological forces of disruption. Not only is disruption often a conservative
enterprise, it is nothing more than rearranging the furniture in a room but then trying
to convince people it’s a diferent room. There is no shift, radical or otherwise, in what
Althusser calls, ‘the determination in the last instance of what happens in the upper
‘loors’ (of the superstructure) by what happens in the economic base’.11 Far from
being shaken by innovation, capitalism, like it does post-crises, lourishes thanks to
the tinkering of entrepreneurs who like to believe they are changing the world and are
champions of social justice. As Joseph Schumpeter says (albeit from another side of
the debate), innovation as technological mutation only ‘incessantly revolutionizes the
economic structure from within’.12
The economic base lourishes as an embodiment of ideas and practices that have underpinned capitalism, largely unchanged, since Adam Smith. Innovation has never interrupted the conditions nor the normal course of the ambitions of capital. Quite the
opposite. Time and again, capital is reinforced and reinvigorated by the love shown
it by economic subjects keen to prostrate themselves at the feet of God-like market
7
8
9
10
11
12
Louis Althusser, On Ideology, London: Verso, 2008.
A popular term in Silicon Valley for those entrepreneurs who aim to build companies from
the ground up is ‘bootstrappers’, the classic image derived from the late 19th century iction
of Horatio Alger who painted the romanticism of the American Dream in terms of the plucky
ingenuity of the underdog who climbs the ladder to prosperity.
Joseph A. Schumpeter, Capitalism, Socialism and Democracy, London: Routledge, 2010, p. 73.
Jill Lepore, ‘The Disruption Machine: What the Gospel of Innovation Gets Wrong’, The New Yorker,
23 June 2014, http://www.newyorker.com/magazine/2014/06/23/the-disruption-machine.
Althusser, On Ideology, p. 8-9.
Schumpeter, Capitalism, Socialism and Democracy, p. 73.
BLOCKCHAIN CRITICISM
47
forces, and recite evolving incantations of technological innovation. The technology
might change but, in this process, it is the only thing that does. Only subtle and ineffectual disruptions to the narratives surrounding desires, needs and motivations (i.e.
problems), that the technology is mobilized to address (i.e. solutions), occur. Narratives
that can themselves be constantly rephrased or even ‘leveraged’ by capital in order to,
for example, justify the pleasure of incessant innovation and why more individuals and
businesses ought to indulge in risk in the name of innovation. ‘The advocates of disruption have an ainity with circular arguments’, claims Lepore, ‘if an established company
doesn’t disrupt, it will fail, and if it fails it must be because it didn’t disrupt. When a startup fails, that’s a success, since epidemic failure is a hallmark of disruptive innovation’.13
Insofar as it can only truly be understood within the conines of its own logic and reason,
disruption is perhaps best understood as a story of self-love. As an ethos, disruption services the self-regarding needs and desires of the capitalist class. That’s why we can think
of it as a form of onanistic self-love that ultimately reinforces the ideological dominance
of capital. Entrepreneurs are preachers of innovation and the natural foot-soldiers, narrators and story-tellers of capital. With spiritualized fervour, their narratives are constructed
to rationalize innovation for innovation sake, and innovation as the Good. But the fact
that the same old stories of how this or that technology will change the world for the betterment of all are parroted by entrepreneurs only makes them all the more disingenuous.
What’s more, it highlights that behind the pretence of such stories are the basic demands
of capital steering the desires of the entrepreneur. As a computer science graduate of
Stanford University, the intellectual heart of Silicon Valley, put it when asked by the University’s magazine to comment on the truth of the motivations of entrepreneurs and the
start-up culture he had experienced there: ‘entrepreneurs like to “put that spin on it, that
we’re going to change the world […] A lot of times, for lack of a better word, that’s just
bullshit”, he said. “The bottom line is that people want to make money”’.14
‘We have seen that the function of entrepreneurs is to reform or revolutionize the pattern of production by exploiting an invention’, claims Joseph Schumpeter, ‘or, more
generally, an untried technological possibility for producing a new commodity or producing an old one in a new way’.15 Schumpeter’s statement paints entrepreneurs as
revolutionaries, but let us once again ask: beyond supericialities, what are entrepreneurs really interested in changing, let alone revolting against? Entrepreneurs adopt
risk and sacriice themselves in the name of capital in situations that function as arenas
for the display of risk and sacriice. Failure (not success) is the sine qua non of what it
means to engage in authentic modern business practices. It’s as though the myth of
Sisyphus has become a principle for the modern entrepreneur to live by, and the world
of blockchain is merely the latest stage for the drama to play out on.
Technology > Eiciency > Monopoly
The strategies employed by capitalism regarding the role and place of technologies
have remained largely unchanged for two centuries. It is something that is echoed in
Althusser’s claim as to the radical eternity of (capitalist) ideology: ‘The peculiarity of
13
14
15
Lepore, ‘The Disruption Machine’.
Fiona Kelliher, ‘The Privilege to Fail: For Startup Founders at Stanford, “Anti-Establishment” and
Privilege Go Hand in Hand’, The Stanford Daily Magazine 1.5 (7 April 2017): 9.
Schumpeter, Capitalism, Socialism and Democracy, p. 117.
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ideology is that it is endowed with a structure and a functioning such as to make it a
non-historical reality, i.e. an omni-historical reality, in the sense in which that structure
and functioning are immutable, present in the same form throughout what we can call
history’.16 Amid the many technologies put into the service of capital over the course of
two hundred years, some have proven of use in multiple domains of industry.
Steam power is a classic example from the rise of industrial capitalism in the 19th century, and now there are various computational forms such as blockchain that appear to
fulil the same multi-domain criteria. As cost-efective and eicient, the success engendered by technologies such as these is directly attributable to desires for accelerated
innovation and their ability to produce a greater surplus for less labour input, or what
André Gorz calls the pushing back of ‘the frontier of the suicient’.17
Eiciency is only one measure of innovative success. Yet, in contemporary Western
capitalist societies, eiciency has become the measure of what it means for commercial (and social) spheres to function properly. In short, in all walks of life eiciency is
good and ineiciency is bad. This determination is rooted in the fundamental logic of
capitalism, namely ‘to maximise proits, facilitate endless capital accumulation and reproduce capitalist class power’.18 Innovation has, under capitalism, become a byword
for greater eiciency and the aggregation of advantages sought by capital to secure
dominance over all social, cultural and political domains. Hence ‘the founding myth of
liberal economic theory’ in the form of perfect (utopian) competitive markets is exactly
that, a myth.19 Instead the logic of economic reason, the aggregation of advantages
sought by capital, ultimately points elsewhere, namely monopoly.20
Even apparent radical exponents of the decentralized liberal nature of capitalism such
as Ludwig Von Mises cannot help but acknowledge the intractability of monopolies in
capitalist reasoning. As Von Mises admits, the centralization of capitalist power in monopolies demonstrates that one’s fellow capitalists have managed to ind a way to yield
greater proits, which is, after all, precisely the aim.21 And where proit is the aim it is
also that which must ultimately be respected. Therefore, innovation must be examined
in light of what it can facilitate not in terms of competition and the growth of markets, at
least not as ends in themselves, but rather, in terms of consolidation and monopoly.22
16
17
18
19
20
Althusser, On Ideology, p. 35.
André Gorz, Critique of Economic Reason, London: Verso, 1989, p. 115.
Harvey, Seventeen Contradictions and the End of Capitalism, pp. 96-97.
Ibid., p. 132.
The tendency towards monopolization is not simply deined in terms of an individual or
corporation assuming complete control over a particular resource, but also assumes more subtle
forms, such as monopoly rents and pricing that have the efect of restricting the production of
certain commodities (see, for example Joseph E. Stiglitz, The Price of Inequality; Thomas Piketty,
Capital in the Twenty-First Century, trans. Arthur Goldhammer, Cambridge, MA and London:
The Belknap Press of Harvard University Press, 2014. Notwithstanding the subtlety however, a
singular logic remains apparent, one predicated on its own peculiar eiciencies. Hence, one of the
most economical (i.e. eicient) ways for an individual to yield the greatest proits for themselves is
to deny the source of those proits to others.
21 Ludwig Von Mises, Liberalism: The Classical Tradition, Bettina Bien Greaves (ed.), Indianapolis, IN:
Liberty Fund, 2005, p. 65.
22 Even Schumpeter admits as much. See for example: Schumpeter, Capitalism, Socialism and
Democracy, pp. 68-69.
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After all, both competition and markets are inherently risk-based, uncertain (unpredictable) and messy, all features that threaten proit and thus also the associated reproduction of capitalist class power. If competition and markets can either be avoided entirely
or made to perform or act less like ordinary manifestations of competition and markets
do, as largely risk-free entities for instance, then this is the direction in which economic
reason under capitalism will ultimately pull. It is the way that entrepreneurs will pave for
their capitalist masters. Certainty and immutability, both of which can be achieved in
non-competitive monopolies, are highly favoured by capital on this basis.23
Blockchain (De)centralization
Blockchain came to prominence in 2007/08 with cryptocurrencies. Instrumental in solving the so-called ‘double-spend’ problem, blockchain represented a novel approach to
anonymous, secure, distributed and decentralized exchange practices that enabled
cryptocurrency communities to circumvent mainstream, traditional and legacy modes
of centralized capitalism — what Satoshi Nakamoto referred to as ‘not going through
inancial institutions’.24 However, as blockchain moves rapidly through its latest round
of iterations (blockchain 2.0) expectations are that it will help solve far more than just
inancial transaction issues. For some the goal is to restore the decentralized make-up
of the internet, in its entirety.25
‘Decentralisation’, as David Harvey claims, ‘is one of the best means to preserve highly
centralized power, because it masks the nature of this centralized power behind a
veneer of individual liberty’.26 In this brief statement Harvey manages perfectly to describe what we are told blockchain is supposed to achieve, and what it is actually being
geared-up to achieve in the service of capital. Decentralization is a structural reality in
the way blockchain functions. Fine. But if desires that tend towards and are in many
cases rooted in centralization are what ultimately inform and are, more importantly,
funding blockchain research and development then decentralization very quickly becomes a tool of centralization.
As ideological modalities, cryptocurrencies are by and large situated within the scope
of high libertarianism and anarcho-capitalism.27 This is, therefore, the soil from which
blockchain in its contemporary form grew. Blockchain 2.0 possess the same DNA
but is under the inluence of far more mainstream and orthodox forms of capitalism.
This means more capitalism and less anarchism. Also, the ‘disruption’ of orthodox
23 To some extent law is a form of social organisation that capital has long expected to make
the (business) world more certain and predictable. For its part law often ends up in the face
of technological proliferation looking highly conservative, which is not helped by instances of
law’s rather inefectual relationship with technology. A classic example in England and Wales
concerns the failure to implement an electronic conveyancing system. See, for example, Michael
Cross, ‘Society Backs Reform of “Distracting” E-Conveyancing Law’, The Law Society Gazette,
2016, https://www.lawgazette.co.uk/news/society-backs-reform-of-distracting-e-conveyancinglaw/5057115.article.
24 Satoshi Nakamoto, Bitcoin: A Peer-to-Peer Electronic Cash System, 2008, https://bitcoin.org/
bitcoin.pdf, p. 1
25 See Kelliher, ‘The Privilege to Fail’, p. 8.
26 Harvey, Seventeen Contradictions and the End of Capitalism.
27 See for example Samuel Edward Konkin III, New Libertarian Manifesto, Koman Publishing, 1983,
https://web.archive.org/web/20120223021118/http://agorism.info/NewLibertarianManifesto.pdf;
and, Fiona Kelliher, ‘The Privilege to Fail’, p. 9.
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inancial models proposed by Nakamoto has not translated into the actual disruption
of the fundamental logic of capitalism underlying the research, development and use
of cryptocurrencies and blockchain. In the hands of entrepreneurs who service their
capitalist masters, therefore, blockchain is providing a means of (re-)centralizing certain networks and systems rather than decentralizing them.28
Appearing to contradict the centralizing tendencies of capitalist class power (the fact
that capital seeks monopoly), it is believed by the faithful that blockchain reproduces
new freedoms and libertarian class power across distributed, decentralized computational nodes.29 In accordance with a liberal myth of capitalism that favours more markets and more competition in order to countermand the threat of monopoly and centralization, blockchain creates the perfect illusion of decentralization. Those who insist on
decentralization as the essence of blockchain’s libertarian credentials are misguided.30
Captured by the ‘force-ield of contemporary capitalism’ each fragmented node instead plays a part in sustaining the dominance of capitalism’s economic reason.31 One
thing is for sure, blockchain is now irmly established as a play-thing of legacy capitalist
institutions and the various startups who come begging to the table for crumbs in order
to satisfy their desire for failure. As Lepore argues, ‘the upstarts who work at startups’
are told by venture capitalists and investors ‘forget rules, obligations, your conscience,
loyalty, a sense of the commonwealth. If you start a business and it succeeds, sell it and
take the cash. Don’t look back. Never pause. Disrupt or be disrupted’.32
Innovation is and has always been ‘immediately perceived as opening new avenues
for economic growth’, countering the threat to capital of inite economic expansion
and consequently heralding the dawn of a new and expansive ‘vision imposed by a
widening of technological horizons’.33 Yet innovation for innovation sake, if that is the
28 Centralization is a problematic concept in this context precisely because it is often seen and
spoken about by the likes of Hayek, for example, as symptomatic of anti-capitalist (communist)
tendencies rather than the ultimate aim for capital itself. As a product of capitalist economic
reason and a logic that privileges eiciency as essential to maximising accumulation and
proit however, centralization qua monopoly clearly ofers a ‘solution’ to the messy uncertainty
(‘problems’) of competition and markets faced by stakeholders of capitalism. In other words,
given the choice between negotiating with other stakeholders in the marketplace, or the ultimate
concentration and consolidation of resources, wealth and power in one pair of hands, capitalist
logic and reason favours the latter. As Marx claimed in his deinition of the law of centralization:
‘Capital aggregates into great masses in one hand because, elsewhere, it is taken out of many
hands’ (Karl Marx, Capital: Volume 2, London: J.M. Dent & Sons Ltd., 1930, p. 691).
29 As David Golumbia claims: ‘From a cyberlibertarian perspective, governments – all governments,
not simply whatever current ‘bad’ government we describe as doing wrong – exist only to curtail
the freedom that is inherently negative […] to be ‘free’ simply is to be ‘free’ from government’
(David Golumbia, The Politics of Bitcoin, p. 6).
30 Blockchain might appear to represent a breakthrough for anarcho-capitalists seeking the
complete absence of government from cyberspace. But, at least from the perspective of left
critique, the vacuum left by the retreat of the State threatens to be illed, even more than at
present, by the insidious forces of economic reason that colonise and cannibalise the political.
The State may not be the best option as a force in the development or control of blockchain, but
the alternative in the form of capitalism is hardly an improvement. What both positions share
however is the ability to conceal the centralization that begets decentralization.
31 Lorenzo Chiesa and Alberto Toscano, ‘Agape and the Anonymous Religion of Atheism’, Angelaki
Journal of Theoretical Humanities 12.1 (April 2007): 118.
32 Lepore, ‘The Disruption Machine’.
33 Robert Heilbroner, The Worldly Philosophers, London: Penguin, 2000, pp. 102-103.
BLOCKCHAIN CRITICISM
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truth of what we are more often than not faced with, straddles a line between barbarism
and civilization, and produces, as André Gorz argues, an ‘a-critical submission to the
technological imperatives of any kind of machinery whatsoever’.34
Blockchain research, development and use is sufused by capitalist class power. Far
from being wholly novel or causing any radical shifts in the socioeconomic world (what
entrepreneurs like to imagine as ‘disruption’), blockchain, at least as we presently ind
it, can simply be added to the long list of technologies that have been drafted into
the service of capital. This in order to reinforce and guarantee the reproduction of
capitalist class power. Even Joseph Schumpeter’s notion of ‘creative destruction’ that
only revolutionizes capitalism ‘from within’ relects the type of ‘innovative’ capitalist
strategy that blockchain is truly part of.35 And so blockchain really only deserves to be
understood in light of the fundamental aims of capitalism. This makes critique of the
technology and its sociocultural afects, rather than a-critical fetishization of the new,
central to understanding what is at stake from blockchain now and in the near future.
References
Althusser, Louis. On Ideology, London: Verso, 2008.
Chiesa, Lorenzo and Alberto Toscano. ‘Agape and the Anonymous Religion of Atheism’, Angelaki
Journal of Theoretical Humanities 12.1 (April 2007).
Cross, Michael. ‘Society Backs Reform of “Distracting” E-Conveyancing Law’, The Law Society
Gazette, 2016, https://www.lawgazette.co.uk/news/society-backs-reform-of-distracting-e-conveyancing-law/5057115.article.
Golumbia, David. The Politics of Bitcoin: Software as Right-Wing Extremism, Minneapolis, MN: University of Minnesota Press, 2016.
Gorz, André. Critique of Economic Reason, London: Verso, 1989.
Harvey, David. Seventeen Contradictions and the End of Capitalism, London: Proile Books, 2015.
Heilbroner, Robert. The Worldly Philosophers, London: Penguin, 2000.
Kelliher, Fiona. ‘The Privilege to Fail. For Startup Founders at Stanford, “Anti-Establishment” and Privilege Go Hand in Hand’, The Stanford Daily Magazine 1.5 (7 April 2017).
Konkin III, Samuel Edward. New Libertarian Manifesto. Koman Publishing, 1983, https://web.archive.
org/web/20120223021118/http://agorism.info/NewLibertarianManifesto.pdf.
Lepore, Jill. ‘The Disruption Machine: What the Gospel of Innovation Gets Wrong’, The New Yorker, 23
June 2014, http://www.newyorker.com/magazine/2014/06/23/the-disruption-machine.
Marx, Karl. Capital: Volume 2, London: J.M. Dent & Sons Ltd., 1930.
Mises, Ludwig Von. Liberalism: The Classical Tradition, Bettina Bien Greaves (ed.), Indianapolis: Liberty
Fund, 2005.
Nakamoto, Satoshi. Bitcoin: A Peer-to-Peer Electronic Cash System, 2008, https://bitcoin.org/bitcoin.
pdf.
Ovenden, James. ‘Blockchain Top Trends in 2017: What Lies Ahead for One of the World’s Most Exciting Technologies?’, The Innovation Enterprise, 29 November 2016, https://channels.theinnovationenterprise.com/articles/blockchain-top-trends-in-2017.
Piketty, Thomas. Capital in the Twenty-First Century, trans. Arthur Goldhammer, Cambridge, MA and
London: The Belknap Press of Harvard University Press, 2014.
Schumpeter, Joseph A. Capitalism, Socialism and Democracy, London: Routledge, 2010.
Schwab, Klaus. The Fourth Industrial Revolution, New York, NY: Crown, 2017.
Stiglitz, Joseph E. The Price of Inequality, London: Penguin, 2013.
34 Gorz, Critique of Economic Reason, p. 87.
35 Schumpeter, Capitalism, Socialism and Democracy.
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POSTCARDS FROM
THE WORLD OF
DECENTRALIZED
MONEY: A STORY IN
THREE PARTS
JAYA KLARA BREKKE
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POSTCARDS FROM THE WORLD OF DECENTRALIZED
MONEY: A STORY IN THREE PARTS
JAYA KLARA BREKKE
Part 1: Alienation, I love you
Barcelona city centre, in an oice, 6th loor, 2015
The sunrays were streaming in through the windows, lighting up the faces of a gathering of city council activists, local Bitcoin entrepreneurs, Faircoin anarchists, Freecoin
freaks1 and some levelheaded and very dedicated complementary currency organizers.
Sometimes a single sentence can overshadow plenty of otherwise profound conversation, so I am going to draw up some quick notes on these profundities before letting
loose about the statement that echoed in my mind since that afternoon. This is just to
tell you that on that spring day in Barcelona there was much interesting and inspiring
talk, covering things like:
– the political implications of diferent currency designs;
– how competitive mining in the Bitcoin proof-of-work consensus protocol for verifying transactions might be replaced by a proof-of-cooperation collaborative process
of automated mining turns;2
– how multi-signature cryptocurrency wallets can allow for things like communally
held digital wallets, ‘money totems’;3
– how functional coding languages, and bringing code closer to natural languages,
can contribute towards intelligibility of complex systems;
– how this is essential for empowering and involving people in the development of systems that increasingly shape their/our lives, including future money infrastructures;
– how the city of Barcelona is working on developing a social currency for poverty
reduction and public services;4
– that there is a need and interest amongst those present in establishing how these
diferent currencies, for diferent functions and geographies, interface with each
other in some form of common bank to facilitate a currency eco-system;5
(… and much, much more that has informed me in my thinking, writing and presentations6).
1
2
3
4
5
6
I mean freaks in the original sense, not ‘weirdos’ (read Shelton’s Fabulous Furry Freak Brothers for
reference).
See Thomas König and Enric Duran, ‘FairCoin2 White Paper’, Fair-coin.org, June 2016, https://
fair-coin.org/de/faircoin2-white-paper/.
See ‘D5.5 Implementation of Digital Social Currency Infrastructure’, Dcentproject.eu, p. 30
September 2015, https://dcentproject.eu/wp-content/uploads/2015/10/D5.5-Implementation-ofdigital-social-currency-infrastructure-.pdf.
See for example Clara Blanchar, ‘Barcelona Contrará con una Moneda Social Propia Pese al
Recelo del Banco de España’, El Pais, 15 November 2016, https://elpais.com/ccaa/2016/11/14/
catalunya/1479126762_781950.html.
https://bankofthecommons.coop/.
See http://distributingchains.org and http://www.jayapapaya.net.
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And so the conversations and presentations continued, blah, b-b-bla blah, blockchain,
until suddenly the interesting talk took a surreal, slow-motion turn, and I heard:
Then we can have a truly free market!
Rewind a bit; this was the conclusion of a story by a person working for the progressive Barcelona City Council, Barcelona En Comu, on their social currency project. The
person had been explicating how technology now allowed for the creation of currencies that can do all kinds of fun and interesting things. And after mentioning a few of
these, like self-destructing money — which I agree is very interesting and refers in part
to the concept of demurrage7 where money loses value over time, which has the efect
of encouraging circulation instead of accumulation — the person gave an example of
how such currencies might allow us to assign value to the things we truly value. In this
proposed scenario, a child might draw a drawing, which might indeed be valued by a
few members of a community, a grandfather or a neighbor; so why not actually value
it, and translate it into a value token? This could then be spent in the local bar on some
locally brewed beer… Value assigned freely by anyone to anything we value, instead of
what banks or bosses value, then we can have
a truly
free
market.8
Now, it would be unfair to read this brief example, a clumsy brain dump and play on
words haphazardly thrown into the discussion that afternoon, as the position of the
city council on social currencies. It isn’t, and the Barcelona social currency is not the
topic of this story. No, what I want to talk about here is how blockchain technology
seems to have spun lots of people into strange, contradictory and entirely unexpected positions on money, markets, power and technology, and my attempts at
regaining some stable ground.
What caught me was the glee with which this person wanted to incorporate a child
drawing into the circuits and demands of productive activity.
The statement by this municipalist activist, although not representative of policy as
such, does point to a broader proposal of possibly monetizing new forms of activity,
7
8
I heartedly encourage anyone to explore the history and social efects of demurrage currencies
— see for example Lietaer’s fascinating excavation of demurrage and the incredible prosperity
of Medieval Europe in B. Lieataer, The Mystery of Money: Beyond Greed and Scarcity, Munich:
Riemann Verlag, 2000, pp. 140-203, see also http://www.lietaer.com and https://dcentproject.
eu/wp-content/uploads/2015/03/design_of_social_digital_currency_publication.pdf and https://
dcentproject.eu/wp-content/uploads/2014/06/D3.4-Field-research-currency_FINAL-v2.pdf.
Part of the reason it was surprising was because usually, a political economy of the progressive
left would take the position that the ‘free market’ is a myth because it in fact relies heavily on
police enforcement, pro-business government policies and legal processes. The notion of
automated governance and law in crypto-currencies is no exception — it’s just that some aspects
of such regulation would be somehow encoded for automated enforcement. It is no closer to
some ‘free’ or ‘natural’ state than government, it is just a radically diferent form or method of
government.
BLOCKCHAIN CRITICISM
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work done ‘for the social good’ and so on. It also points to creating new currencies as
a way to incentivize eforts that are needed in a community, while relieving pressures
from a lack of income from increased unemployment and the dwindling of any welfare
support. The background to this is on the one hand a critique of the ways that giant tech companies monetize our social relations and everyday activities through data
markets, responding by demanding a wage for these activities they are proiting from,
or better yet, wresting these systems from the hands of these companies and running
them via public institutions, inventing new currencies to make sure that this work is
now paid for. On the other, the anarchist extension of this analysis is: why run them
publicly when we can run them ourselves through peer-to-peer networks?
While I might agree with the sentiment — dignifying with an appropriate wage what
might otherwise be an exploitative/extractive situation — it can be hard to see how this
doesn’t also expand the realms of work and the reach of what is considered tradable.
Suddenly, instead of limiting the amount we have to work and keeping certain valued
things outside of market dynamics, activities that would normally constitute our free
time are made tradable.
I am not going to replicate here a critique that has already been articulated by others9
about how blockchain is the ultimate vehicle for reproducing neoliberal subjectivity,
which amounts to something along the lines of:
the explosive arrival of blockchain technology has splintered neo-liberalism into tiny
shards that instead of being destroyed have rained down and pierced into all of us and
our stuf, turning all our things into capital/assets and all of our endeavors into work/
inancial speculation.
There is some hard truth in that. My punk friends are checking the Bitcoin exchange
charts daily and diversifying their portfolios into NEO,10 OMG,11 Dash,12 and Ether,13
banding together to form asset management coops and the like,14 while other anarchist compañera/os are looking into ways of digitizing and scaling the bartering
economy. This is an idea that aligns in an eerie fashion with the ambition of FinTech
entrepreneurs of creating not just an Internet of Things and Internet Of Money, but
indeed also what we might call an automated Economy Of Things that would allow
‘any object to be rented, sold or shared — without middlemen’.15 (A truly free market
— where even money itself is disintermediated, replaced by self-trading objects and
interlocking reputation systems?)
9
10
11
12
13
14
15
See for example Rachel O’Dwyer, ‘The Revolution will (Not) be Decentralized: Blockchains’,
Commons Transition, 11 June 2015, http://commonstransition.org/the-revolution-will-not-bedecentralised-blockchains/ and David Golumbia, ‘Bitcoin as Politics: Distributed Right Wing
Extremism’, in Geert Lovink, Nathaniel Tkacz and Patricia de Vries (eds), MoneyLab Reader: An
Intervention in Digital Economy, Amsterdam: Institute of Network Cultures, 2015, pp. 117-131.
https://neo.org.
https://omg.omise.co.
https://www.dash.org.
https://www.ethereum.org.
I take part in these activities myself, so be careful and do NOT read this as a criticism of my
friends.
See for example https://slock.it.
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There is much to be worked out, in terms of the politics and what such new behaviors
and developments mean in terms of power and eforts to systematize equal access
and solidarity. Part of me doesn’t mind seeing my friends, some of which have been
left tight for cash in the recent economic downturns, ind other ways to get rich fast,
whether through DIY speculation or new forms of employment. Making money can feel
brilliantly empowering. I also think the processes of subjectiication are still open and
more complicated than simply replicating a capitalist logic/subjectivity. For now, it is
hard to see much beyond the replication of speculative behaviors because we are in
the middle of a gold rush — everyone running head- over-heals to grab a bit (more on
this in the next stories.) But for now the monopoly of money has been broken and, for
a moment at least, there is experimentation going on that is neither in the hands of any
state nor any corporation.16
With Bitcoin and the invention of the blockchain,17 money became programmable and
open source and, in the years since, has inspired much experimentation and creativity in this new intersection of computation, currencies, governance and accounting.
This new ield allows for very ine-grained (re)programming of the medium of money,
from what constitutes, and how to measure, value-generating activity to the setting of
parameters on the means and conditions of exchange – what is spendable, where and
by whom. This also means that the design and programming of money allows for evermore complex means for behavioral engineering, remunerating some behavior over
others in ways that can target and apply to some people rather than others.
Money — store of value, a means of exchange or social engineering? I say this not as
some sort of gloomy commentary on contemporary society, but as a caution against
assuming that bright-eyed intentions of doing good via blockchain currencies necessarily has the efects one might assume. In particular, in eforts that target (the word is
perhaps revealing) poverty and the poor.
I would like to ofer up just one hopefully helpful concept for thinking through the swirling, changing power dynamics of blockchain and new currency designs: access.
What makes a currency powerful? The fact that it grants access to things, people,
services and places. The choice of what you want to monetize or not is power. Allowing or disallowing access via particular currencies is power. The more universal the
currency, the more powerful it is. We are most used to this in terms of national currencies granting access to things within a given territory (and the presence of the dollar
in other territories as evidence of empire etc.) But programmable currencies can/will
also mediate access in relation to diferent industries, product ranges, demographic,
behavior, brand, reputation, identity etc. in an ever more ine-grained manner.
What used to be generalized for a particular territory is about to fracture into layers of
diferential access — not necessarily a bad thing; this is indeed what a ‘currency ecosystem’ entails. However, when developing and designing such new political econo-
16
17
So far this is the case for Bitcoin at least, the irst blockchain project, and still very much an
experiment run by a community of computer scientists, programmers and enthusiasts.
See Satoshi Nakamoto, ‘Bitcoin: A Peer-to-Peer Electronic Cash System’, Bitcoin.org, October
2008, https://bitcoin.org/bitcoin.pdf.
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mies, the ways diferential access relates to inequality, identity and personal/ collective
histories needs to be carefully analyzed. Diferential conditions on access for speciic
goods or services can be disempowering and oppressive or empowering and exclusive,
depending on whether you are the one who gets to determine the conditions for access.
This is how inequality plays a signiicant role in the efects of diferential access.
In a private conversation at a local Barcelona neighborhood street party, a city councilor in fact voiced some of these concerns. That any social currency project aimed
at the poor has the danger of creeping towards behavioral engineering whereby for
example remuneration is accessed on the conditions of good behavior and is only
spendable for certain goods at certiied shops. Instead, she said, ideally a social currency project should aim for generalized access to public services, including for the
middle class, instead of determined by inely monitored personal or class conditions.
Just to mention one example.
So, how, then, did I come to love alienation? That afternoon on the 6th loor in Barcelona, I had a moment of feeling that the only good aspect of the hyper-exploitative free
market — you know, the ‘free’ bit — was slipping away, and I was being chained to an
immutable record of past fuck-ups by a vast crowd of smiling activists telling me it’s for
the common good. I realized I LIKE the fact that cold cash doesn’t care about me, you
or anyone else. A public utility18 for general use regardless of who you are.
Money gets blamed for a lot of things. It is seen as the root of all Evil, generating greed
and creating alienation by putting a cold medium between our productive eforts and
the fulillment of our needs. But that gap between what was done to get the $$$ and
the ability to spend it, the very attribute of alienation, money as the universal equalizer,
is indeed also an equalizer in the sense that an outcast with a pound coin can spend
that pound coin the same way as a respectable priest. A freedom of sorts, from the
tyrannical opinions of others. Not necessarily a bad thing. Do NOT misunderstand — I
am not saying that cash or the market is neutral. My point is the opposite, that now that
money is open for redesign, it is the contingencies rather than intentions that are going
to determine the efects, and so, rather than relying on existing political economic assumptions, attention needs to be paid to these.
Strange things can happen in an attempt to humanize the market in the context of
automated global network technology. Which in my mind that afternoon looked a little
something like bartering + blockchain = possibly the worst of the village with the worst
of the metropolis, trade secured by an immutable reputation system in which the repressive whispers of village grannies are instantaneously globally relayed through hyper-connected nodes, lending them a veneer of objectivity while enforcing diferential
and inely catered mob-justice through alienated smart contract systems. Just to mention yet another dystopian projection for blockchain tech. My point is that a concern for
the broader social good can quickly become a sinister endeavor when equipped with
the possibilities of powerful, networked technologies.
18
For some good insight into the privatization of cash, see Brett Scott, ‘Hang on to your Cash.
This dash to Digitise Payments is Dangerous’, The Guardian, 13 September 2017, https://www.
theguardian.com/commentisfree/2017/sep/13/cash-digitise-payments-money-cashless/.
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That afternoon in Barcelona I had a sudden wave of premature nostalgia for cash.
Nobody cared who I was, nobody cared where my money came from, I could use it to
get my Turkish menemen on an easy Sunday morning and that felt great. Alienation, I
love you and I miss you already.
Part 2: A tribute to those who will never be peers
Bitcoin github repo, August 1st, 2017
This day in Bitcoin-landia had been marked as the culmination and possible inal resolution of a conlict that had been raging for some three to four years. The conlict was
about an existing hard limit on the data-size of blocks on the Bitcoin blockchain, set to
1MB — whether and how it should be increased. And today was the day the protocol
was going to be hard-and-soft forked19 into several versions for how to move forward
on this question and the development of the project overall.
Other authors have written excellent informative pieces about the politicized nature of what, to some, might seem an obscure technical question and the ways in
which it in fact relects very diferent understandings of decentralization, power and
governance.20 The story I want to address here is slightly more meta. Here is what
I think is really at stake in the Bitcoin scaling conlict: The possible shaping of new
types of subjectivity.21
Bitcoin was irst introduced in 2008 as a proposal for a peer-to-peer electronic money system. In this enticing combination of network technology, cryptography and
a systems-architecture-that-pays-for-its-own-security-through-some-basic-marketlogics the idea was that we could get rid of the need for authorities, like banks, to
guarantee relations and trust between people who don’t know each other, replacing
such trust with cryptographic proof, and thereby run global money systems through
networks of peers.
The experiment has since grown immensely — in numbers of people, places, organizations and companies involved, and value moved through the system. It is now facing a
19
A fork refers to when a change is made to the protocol that might not be agreed upon by everyone
in the network so that diferent versions are run by diferent nodes. A hardfork is a change to the
protocol that makes it incompatible with the previous version, essentially splitting the network,
while a softfork is still compatible with the previous version. See https://www.btcforkmonitor.info/.
20 See especially van Aaron van Wirdum, ‘On Consensus, or Why Bitcoin's Blocksize Presents a
Political Trade-Of’, Bitcoin Magazine, 15 January 2016, https://bitcoinmagazine.com/articles/
on-consensus-or-why-bitcoin-s-block-size-presents-a-political-trade-of-1452887468/ and ‘Why
Some Changes to Bitcoin Require Consensus: Bitcoin's 4 Layers’, Bitcoin Magazine, 26 February
2016, https://bitcoinmagazine.com/articles/why-some-changes-to-bitcoin-require-consensusbitcoin-s-layers-1456512578/.
21 I chose the word subjectivity here (instead of 'identity', 'persona', or 'self') because it is interior
and exterior, personal and political, it is shaped by the systems and contexts we inhabit as much
as our personal evolution, decisions and development. And it is shaped through and in relation to
the systems we engage with.
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problem of scaling. If you read through crypto-currency news sites,22 Twitter,23 threads
on Reddit24 and commentary on Medium,25 the conlict over scaling was brought on
by a concern that the increasing number of transactions were clogging the network
because of the hard limit on size of blocks of transactions that were being veriied.
Some therefore argue the hard limit needs to be increased, while others are wary of
such a development as it might centralize aspects of the network and have therefore
developed other solutions.26
The point is that there are diferent versions of what decentralization and scaling means
and what is important in terms of use-cases and features and the future of the system.
While some want to out-compete existing payment systems (Pay-pal, Visa, Mastercard), possibly risking centralization of aspects of the network in the process, others
want to hold out on such ambitions in order to keep moving towards something entirely
diferent, a vision, perhaps, of Bitcoin more as a vast and still open-ended scientiic
experiment27 than (or in addition to) a new global payment system.
Let’s look closer at the word ‘scale’. Scale has many diferent meanings: increase in
quantity, size, volume and geographical spread. I would like to introduce another vector to the concept of scale — diferentiation. As the Bitcoin network grows, the fact that
you have increasingly diferentiated users, uses, and roles means that the nature of the
network changes, as do questions of power.
Here’s where I am going with this: for a system to be peer-to-peer you need to have
a network of, well, peers. The assumptions that are usually associated with peer-topeer, such as horizontality, decentralized power, neutrality, equality and openness can
only be considered true if those involved indeed are peers. As more and more people
get invested, and are interacting with and developing diferent aspects of the system,
these applications, interactions and people will be diferent, have diferent capabilities,
experiences, abilities and needs (and hey, that do not necessarily run a full client, contribute to or fork the code base.)
This is a tribute to all those who are never going to (be able to) be peers. They might
be busy doing other useful things.
22 See van Aaron van Wirdum, ‘On Consensus, or Why Bitcoin’s Blocksize Presents a Political TradeOf’.
23 See for example @sthenc, ‘Confession: I was briely a Bitcoin Classic supporter, before learning
more about how bitcoin works.’, Twitter post, 4 December 2016, 12:11 AM, https://twitter.com/
sthenc/status/805187632929964032.
24 For example VonnDooom, ‘Informative BTC vs BCH Articles?’, Reddit, 6 August 2017, https://
np.reddit.com/r/BitcoinMarkets/comments/6rxw7k/informative_btc_vs_bch_articles/.
25 See for example Valery Vavilov, ‘Keep Calm and Bitcoin On’, Medium, 18 January 2016, https://
medium.com/@BitFuryGroup/keep-calm-and-bitcoin-on-4f29d581276 or Mike Hearn, ‘The
Resolution of the Bitcoin Experiment’, Medium, 14 January 2016, https://blog.plan99.net/theresolution-of-the-bitcoin-experiment-dabb30201f7/.
26 See Aaron van Wirdum, ‘Segregated Witness, Part 1: How a Clever Hack Could Signiicantly
Increase Bitcoin's Potential’, Bitcoin Magazine, 19 December 2015, https://bitcoinmagazine.
com/articles/segregated-witness-part-how-a-clever-hack-could-signiicantly-increase-bitcoin-spotential-1450553618/.
27 Jaromil in ‘Kaiser Report: Make Bitcoin Great Again (Summer Solutions E1099)’, Youtube, 20 July
2017, https://www.youtube.com/watch?v=GiXAaa_cvbk&feature=youtu.be/.
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‘Peer’ is one of those curious words that (potentially) means both a person and a node
in a technical network. In Bitcoin, a peer would be miners and full nodes that verify and
secure the network, but it also alludes to these people who contribute, are developers
and researchers and so on. There is indeed an incredibly active and lively network of
actual peers that maintain, experiment with and develop Bitcoin. But I would dare say
that most interactions with the infrastructure are no longer by miners nor full nodes,
but by people transacting using exchanges and wallets that they probably don’t even
hold the keys to.
The scaling conlict is not only about increasing block sizes on the blockchain, it is
also about Bitcoin having reached such a scale that it can no longer be thought of as
composed by peers.
The conlict and now quite high stakes of this infrastructure raises questions of accountability in the decisions being made — by developers, by miners and full nodes
(see #UASF). Some aspects of the infrastructure provide an outstanding basis for this:
‘commits’ and contributions to the code are transparent, the developer’s mailing list
is all open and there is an impressive amount of glossaries and guides for those who
want to look into it. But to beneit from such openness requires not an insigniicant
level of literacy, time and interest, and the big rifts and murky rumors that have characterized the scaling conlict are not easy to comprehend. Many people are left having
to trust the word of some over the word of another (an ironic condition for what is supposed to be a trustless system28).
It might be fair to say that a lot of non-peer interactions are by users that we might
want to call ‘DIY inancial speculators’, who should take full responsibility for any risk
they get themselves involved in. The project started in a sense as a giddy experiment
in which the scientists, cryptographers and hackers involved were only really accountable to themselves and their own curiosity and tinkering. And certainly there is an element of this still, the project is as of yet a vast collaborative efort of enthusiasts. Why
should they bother about such people?
If the infrastructure is indeed to grow and have use beyond speculation while still staying true to non-state, non-corporate sentiments, then it might be the time to recognize
and consider new subjectivities that would form in the process, and the fact that not all
of them are going to be peers. So who do we consider to be part of this new constituency and how do we take care of them? Are they ‘users’ or something else? If a state
is supposedly accountable to ‘citizens’, a corporation is accountable to ‘customers’
or ‘clients’ and platforms are accountable to ‘users’, who are peer-to-peer networks
accountable to? When peer-to-peer networks scale how do they deal with diferentiation and the emergence of non-peers who are dependent on the system? From a less
conspiratorial perspective, regulation might be considered a response to this condition
in order to ensure accountability. But surely it must be possible to work out some more
28 Trustless refers to the concept of a system that works even if actors within it cannot be trusted.
This idea, particular to networks of computers, is assumed to be applicable to other realms
such that with the blockchain one would not have to trust institutions, banks or authorities with
transactions and balances of accounts as these would be replaced by cryptographic proof
instead.
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interesting ways to go about accountability and taking care of diferences and diferential capacities that feel better than the-long-arm-of-the-law, or that do not entail black
holes of tedious reporting, nor automated village granny reputation systems…
Unless this is worked out, and until then, this project of ‘disintermediation’ for those
who are not peers is actually a project of reintermediation — simply swapping one
set of intermediaries (the banks, politicians and legal system) for another (developers,
computer scientists and network technology), or, even worse, adding another layer of
intermediation and complexity.
Part 3: Be woke, be free
In a café, somewhere recently in old Europa
What do these two stories have in common? They are both really a caution against
double-speak. I have nothing against double-speak as a cunning strategy and not
even that much when it is used as a cynical marketing ploy, but when it is used unconsciously — you, fooling yourself — that, my friend, is unforgivable.
There is a sense that we are in a unique period, that the doors to the money-press have
been lung open and we have limited time before the police come running. Literally?
Sure, maybe that too,29 but I actually mean it more broadly in the sense of Ranciere:
the police as the re-establishment of some form of order.
In contrast to the ‘police’, (let’s carry on a bit with Ranciere) his understanding of
‘politics’ refers to those moments when a given order is disrupted30 and renegotiated
and new subjectivities emerge as recognized actors. Ranciere calls this a redistribution of the sensible — literally, what and who is seen, who counts and is able to act
in a given space, is changed, and redistributed across new spaces. This age of cryptocurrencies most deinitely resonates with such a description — new subjectivities
are emerging, new spaces are being developed (literally) in which those who were not
supposed to be able to do certain things, like issue new kinds of money and authorize transactions — they are enthusiastically doing so, deining new conditions and
spaces for these actions.
But wait, so where exactly are we now? We are in a café, somewhere in the old Europa, and with me, nibbling a slice of cake, is a European Commission expert advisor,
a highly respected computer-engineering professor and soon to join us is a successful
blockchain entrepreneur. A bit of intellectual posturing, some networking and the conversation winds its way to the question of what big themes and issues are pressing and
how best to structure R&D funding for these. ‘The boring sounding problem of taxation
might actually be the most urgent and worthwhile to solve’ says the computer engineer.
And that is what stuck with me from that conversation.
29 See for example the story of E-Gold.
30 I just want to declare that while I used to be I am no longer a fan of ‘disruption’. It has been
thoroughly coopted for purposes of chasing competitive advantage rather than freeing up new
spaces of doing and being. Instead we are constantly disrupted in all kinds of ways whether we
like it or not. Preservation seems more radical these days than disruption.
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I would put it diferently: the problem, strictly speaking, is of redistribution, for which
taxation is the awkward solution we have today, ensuring commonly held and essential infrastructures, services and wealth. But I agree that redistribution is absolutely
one of the most urgent and worthwhile problems to work out in a way that is meaningful and efective.
The question of redistribution addresses what many projects of decentralization and
local autonomy (or sure, individual autonomy if you’re one of those assholes) tend to
overlook, a point I have tried to make a few times throughout this short story: that
pre-existing conditions of inequality and access to resources means that what might
seem progressive can easily be distorted into a nightmare. What looks like Ah! Nice!
Local autonomy and decentralization of power might in fact simply be decentralization
of risk. There is no such thing as a level playing ield, land is luscious and bountiful in
some parts and contaminated and toxic in others.
If you ind yourself bright-eyed before these shiny new architectures, enthusiastically
contributing to a machine for automating utopia, take a moment to blink, squint and
look again at what you are doing and if it really does, should or ever will live up to
the promises on whichever website banner. Be woke so you can stay free when the
police come knocking.
So far, redistribution eforts that I have seen in crypto have taken place through two
diferent strategies: collective speculation in which the aim is essentially to take advantage of a window of opportunity, use and abuse the crypto bubble, cash out and give
it to cash-strapped solidarity projects. The other is currency creation. There are many
diferent ways that money systems can be designed and programmed. With a rapidly
growing ield of possibilities that we are facing, literacy in such matters and especially
an awareness of the distorting efects of contingencies and interfaces between systems is urgently needed. I believe that currency designers as a new profession, who
are able to map contingencies across scales and disciplines, are going to be in high
demand. It would be brilliant if some talented, sharp and empathetic heads could look
seriously at redistribution and the organization of solidarity across scales.
So, what would happen when cops arrive and catch us covered in ink and paper?
What would the re-establishment of order look like? When do we know the gold rush
is over? Well, there is obviously the possibility that these (ponzi?) schemes simply
collapse, that the dosh we so frantically printed is worthless, crypto suddenly has no
value, the bubble bursts, tulips,31 back to the euro, dollar and so on. Or, the owners
of the money-press (would that be the state or private banks?) bring in the police and
set out some terms and conditions for our use of the money press, (regulation) limiting
access for certain people and purposes.
OR, in a much more interesting twist to the story, that this new tech actually proves
itself, that it allows for a true redistribution of the sensible, in which new subjectivities
emerge that are empowered to engage in the shaping and governing of commonly
held global infrastructures. Bitcoin was introduced to the world as online cash, a noble
31 See tulip mania in 1619-1622 – a favorite historical reference for critics of Bitcoin.
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proposition in a world headed for privately controlled and surveilled electronic payment systems, whether one disagrees with its anarcho-capitalist protocol design and
speculative tendencies or not. But blockchain, while originally invented to support this
online cash, in fact allows for much more ine-grained design and control of money, its
lows and conditions — and in its evolution these contradictory possibilities have exploded in all directions. In the midst of the start-up mania, the vortex of life-changing,
make money moneeeey opportunities, remember to stay woke: What is now at stake is
the question of developing a global money system that is neither a public utility (cash)
nor private infrastructure (electronic payments via banks), a question of governance as
much as cryptographic properties, currency design and technical features. Indeed, an
experiment with lots of risky, unintentional, clumsy and strange outcomes that simultaneously raises all the right questions.
References
Blanchar, Clara. ‘Barcelona Contrará con una Moneda Social Propia Pese al Recelo del Banco
de España’, El Pais, 15 November 2016, https://elpais.com/ccaa/2016/11/14/catalunya/1479126762_781950.html.
‘D5.5 Implementation of Digital Social Currency Infrastructure’, Dcentproject.eu, 30 September 2015,
https://dcentproject.eu/wp-content/uploads/2015/10/D5.5-Implementation-of-digital-social-currency-infrastructure-.pdf.
Golumbia, David. ‘Bitcoin as Politics: Distributed Right Wing Extremism’, in Geert Lovink, Nathaniel
Tkacz and Patricia de Vries (eds), MoneyLab Reader: An Intervention in Digital Economy, Amsterdam: Institute of Network Cultures, 2015.
Hearn, Mike. ‘The Resolution of the Bitcoin Experiment’, Medium, 14 January 2016, https://blog.
plan99.net/the-resolution-of-the-bitcoin-experiment-dabb30201f7/.
Jaromil, ‘Kaiser Report: Make Bitcoin Great Again (Summer Solutions E1099)’, Youtube, 20 July 2017,
https://www.youtube.com/watch?v=GiXAaa_cvbk&feature=youtu.be/.
König, Thomas and Enric Duran. ‘FairCoin2 White Paper’, Fair-coin.org, June 2016, https://fair-coin.
org/de/faircoin2-white-paper/.
Lieataer, B. The Mystery of Money: Beyond Greed and Scarcity, Munich: Riemann Verlag, 2000.
Nakamoto, Satoshi. ‘Bitcoin: A Peer-to-Peer Electronic Cash System’, Bitcoin.org, October 2008,
https://bitcoin.org/bitcoin.pdf.
O'Dwyer, Rachel. ‘The Revolution will (not) be Decentralized: Blockchains’, Commons Transition, 11
June 2015, http://commonstransition.org/the-revolution-will-not-be-decentralised-blockchains/.
Scott, Brett. ‘Hang on to your Cash: This dash to Digitise Payments is Dangerous’, The Guardian, 13
September 2017, https://www.theguardian.com/commentisfree/2017/sep/13/cash-digitise-payments-money-cashless/.
Vavilov, Valery. ‘Keep Calm and Bitcoin On’, Medium, 18 January 2016, https://medium.com/@BitFuryGroup/keep-calm-and-bitcoin-on-4f29d581276.
VonnDooom. ‘Informative BTC vs BCH Articles?’, Reddit, 6 August 2017, https://np.reddit.com/r/BitcoinMarkets/comments/6rxw7k/informative_btc_vs_bch_articles/.
Wirdum, Aaron van. ‘Segregated Witness, Part 1: How a Clever Hack Could Signiicantly Increase Bitcoin's Potential’, Bitcoin Magazine, 19 December 2015, https://bitcoinmagazine.com/articles/segregated-witness-part-how-a-clever-hack-could-signiicantly-increase-bitcoin-s-potential-1450553618/.
_____. ‘On Consensus, or Why Bitcoin's Blocksize Presents a Political Trade-Of’, Bitcoin Magazine, 15
January 2016, https://bitcoinmagazine.com/articles/on-consensus-or-why-bitcoin-s-block-sizepresents-a-political-trade-of-1452887468/.
_____. ‘Why Some Changes to Bitcoin Require Consensus: Bitcoin's 4 Layers’, Bitcoin Magazine, 26
February 2016, https://bitcoinmagazine.com/articles/why-some-changes-to-bitcoin-require-consensus-bitcoin-s-layers-1456512578/.
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LOVE ON THE BLOCK
MAX DOVEY
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LOVE ON THE BLOCK
MAX DOVEY
This article irst appeared in Artists Re:Thinking the Blockchain.1
Bitcoin Transaction = 5f791ac0c4e4f04cceefe178e9a25ae2f0eb00f30d5eb4cd73aaea0d3
45f541
Hex = 6a1d57652077696c6c207368617265207468697320736f6c656d6e20766f77
Ascii = We will share this solemn vow
$ 708.93 - $ 708.75
Transaction fee = $ 0.19
(231 bytes)
86653 Conirmations
17ePTBvtX6msSC6jqPbgacyvo6r5QttWkM
16Cz5s37SwhThspFfQZCE8ttYpmVRx6miJ
Bitcoin Transaction = c20f6b396208cadc951a33cd1ee7ce4a8b8c7cc1bffcc22eb9156eb0af68dae
Hex = 6a247769746820657665726c617374696e67206c6f766520696e206f7572206865617274732c
Ascii = with everlasting love in our hearts,
$ 79.97 - $ 79.78
Transaction fee = $ 0.19
(238 bytes)
86653 Conirmations
1FoJPn8mHZTeiPhLpzxWe29ds5MWhEPvXG
1C6MFsat54HeD51uzjbVSbL6YdsQWVJh3D
Bitcoin Transaction = 1be8855420bf4cbb4b0e23a74e42f6c04195d78ab149fb0a5f67df216739e2a9
Hex = 6a1566726f6d20746869732076657279206d6f6d656e74
Ascii = from this very moment
$111.97 - $111.78
Transaction fee = $ 0.19
(223 bytes)
86652 Conirmations
1DYcB34vPPSD1Ex93FEV73TWpizHB7yKjP
12X8o3ZKWXAqF1J111fLiaxH9PCnMNzzFm
Bitcoin Transaction = 017202287321d49bdd4a793d5a1a112d3fd853df193b97b0578797a759f1552f
Hex = 6a18756e74696c206f7572206479696e6720627265617468732e
Ascii = until our dying breaths.
$124.65 - $124.47
Transaction fee = $ 0.19
(226bytes)
86653 Conirmations
1EV4qtBCUAVGmd99uFJoNDetQVYWq39jcE
198Yi4E4M4TtTWDVGtmx54aP11kt6Hb1FN
1.
Ruth Catlow, Marc Garrett, Nathan Jones and Sam Skinner (eds), Artists Re:Thinking the
Blockchain, Liverpool and London: Torque and Furtherield, 2017.
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For better or worse, till death do us part, because the blockchain is forever.
—Wedding Vows of David Mondrus and Joyce Bayo2
For many, using bitcoin to oiciate a marriage sounds as romantic as a irst date outside a high street bank, but the various ways in which people are developing bitcoin,
blockchain and cryptography to encapsulate love and administrate civic arrangements,
such as marriage, reveal a deeper devotion towards blockchain technology as the new
church and state. Since the irst bitcoin marriage ceremony in 2014, couples have
continued to express their love on the blockchain and adapt the marital contract from
encrypting vows into bitcoin payments to designing ‘smart contracts’ that combine
networked devices with coded contracts stored on the blockchain. Whilst some initial
wedding ceremonies were performed by a small number of extreme bitcoin fanatics
there has since been further experimentation occurring within a wider movement in the
crypto-community — one that aims to proliferate the viability of the blockchain as a
governance technology that replaces central authorities. Looking at bitcoin weddings,
we see not just individuals invested in the notions of permanence and viability implicit
in the blockchain, but a spiritual commitment to the blockchain ideal – a faith that it
will not only transform legal arrangements, but inaugurate a technologically absolutist
model of governance that deies and circumvents traditional organizations of power.
Bitcoin weddings are the start of a sermon that aims to persuade society of the blockchain as an alternative system for the administration of society. They are symbolic of
a wider-culture within crypto communities that go beyond political ambition to reveal
a spiritual dimension to cryptographic protocol where belief, faith and performed acts
of software sovereignty become lived commitments to technological fundamentalism.
What do libertarians ind the most romantic in marriage? The contract.
—Reddit user engelk3
The irst recorded example of a bitcoin wedding ceremony was between Joyce Bayo
and David Mondrus in Disneyworld Florida, where the couple stood in front of the altaltar of a bitcoin ATM machine. The pair used the ATM to pay one another with the attached comment: ‘For better or worse, till death do us part, because the blockchain is
forever’. Bitcoin is used in this case to cement a belief in the permanence of blockchain
ledger, however anyone unfamiliar with the underlying technology would be forgiven
for asking why the couple didn’t just use their credit cards and alter their vows to ‘For
better or worse, till death do us part, because Visa is forever’. Swapping the alter for
a bitcoin ATM signiies a growing ambition to use encryption, cryptography and the
blockchain database to pursue the notion of using inancial transactions as more than
payments but also as contractual agreements. Oscar and Yenni from Indonesia performed their marriage in a similar way, but encoded much lengthier vows as hex strings
into a series of transactions. Each transaction contains a hex string that when converted into ASCII (American Standard Code for Information Interchange) reveals their
2
3
‘How Humans Now Use the Blockchain to Declare Love and Marriage’, Blogchain.info, 14
February 2017, http://blogchain.info/post/how-humans-now-use-the-blockchain-to-declare-loveand-marriage.
‘Couple to use Blockchain to Contract Marriage. I'm Honored to be Oiciating’, Reddit, 25
September 2014, https://www.reddit.com/r/Bitcoin/comments/2hfwd/couple_to_use_blockchain_
to_contract_marriage_im/.
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personalized, encrypted vows. Oscar transferred over $2,000 to eighteen arbitrary accounts in order to encode the vows over a series of bitcoin payments into a number of
blocks. With each block taking on average 10 minutes to clear the process of validating the vows would have taken longer than David and Joyce’s one of payment and
perhaps distributing one’s vows over multiple payments shows a longer lasting love.
The grooms in both marriages (David Mondrus and Oscar Darmawan) are well known
bitcoin investors and publicity stunts such as this are often engineered to serve their
inancial interests. In this sense both weddings were successful and circulated widely
on crypto-currency news sites and Oscar was awarded a certiicate for holding the irst
Indonesian bitcoin wedding.4 David Mondrus is the CEO of a bitcoin jewellery store,
so the wedding appears to be a staged opportunity to promote the QR Code rings he
had on sale at the time (unfortunately ‘red box jewels’ no longer seems to be online).5
Fig. 1. The BTC ring (http://thebtcring.com, 2015).
For these grooms the bitcoin wedding serves as a novel way to inlate the market price
of your favourite crypto-currency, however these symbolic acts also reveal personal
devotion towards bitcoin and turns the belief in blockchain’s permanence toward a
spiritual dimension. By turning ‘proof of work’, the cryptographic process for validating bitcoin transactions, into ‘proof of love’, what other feelings, relations and social
bonds can be re-conigured as blockchain transactions? The marriage is one of the
more popular civic arrangements to become cryptographically re-conigured and encrypting one’s vows is just the beginning of a series of experiments with programming
contracts, which will also include property rights and even automating divorce.
4
5
Rahmat and Ori, ‘Indonesian Record Museum (MURI) Bestowed a Special Award at CEO Bitcoin.
co.id’, Steemit, 5 July 2016, https://steemit.com/bitcoin/@rahmat/2gwcng-indonesian-recordmuseum-muri-bestowed-a-special-award-at-ceo-bitcoin-co-id.
http://www.redboxjewels.com.
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Fig. 2. Oscar & Yenni Wedding Invitation (http://bitcinwedding.com, 2015).
I have participated in the design of a blockchain based wedding application with The
Design Informatics department from University of Edinburgh where we designed prototypes based on a geo-locative crypto-currency called ‘GeoCoin’.6 ‘GeoCoin’ is a platform that connects GPS data to digital wallets for crypto-currencies, enabling users
to design inancial or economic arrangements based on location and movement. We
developed a smart contract that would enable people to create temporary shared bank
accounts between one another whose spending would be bound by their location data.
Like marriage, it joined individuals to share inances based on their physical proximity.
This application was named Handfastr after the informal practice of ‘handfasting’ in the
middle ages — a temporary marital arrangement that was valid without having to be
solemnized by a priest or the church.7 Handfastr uses GPS data to enforce a smart contract — a self-executing script stored on the blockchain — so that when two or more
people are together in the same physical space they can access and spend money
6
7
http://geocoin.site/.
‘History of Marriage in Great Britain and Ireland’, Wikipedia, https://en.wikipedia.org/wiki/History_
of_marriage_in_Great_Britain_and_Ireland.
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from the same digital wallet. The diference between blockchain based smart contracts
such as Handfastr and the bitcoin wedding ceremonies previously mentioned is that
while a bitcoin ceremony happens once with a inancial transaction (or series of transactions), a smart contract is a piece of code containing rules and conditions that can
be executed over a period of time. Think of a bitcoin wedding as a ceremony, and the
smart contract as the marriage that emerges, requiring laws to untangle and annul it.
Fig. 3. Handfastr (Corina Angheloiu, Max Dovey, James Stewart, 2016).
Programmers have also begun experimenting with how smart contracts could be used
to process — even anticipate — the conditions for a divorce or separation of couples.
The opportunity to code legal procedures that involve the splitting of property, ownership and access rights is a logical application of these tools for blockchain based
programmers’ eager to demonstrate the viable eiciency of networked governance. A
common attitude is that blockchain technology liberates individuals from the centralized powers such as the church and state, however, experiments in smart contract
systems such as this should be critically relected upon and we should ask what kind
of arrangements do we want to turn into autonomous governing system(s).
Weddings & divorces are just one of many civic and legal procedures that are being
engineered into blockchain contracts and it is interesting to consider this development
as part of a political trajectory that originated from an obscure cypherpunk mailing list.
In The Politics of Bitcoin: Software as Right-Wing Extremism David Golumbia highlights
the extreme libertarian free market attitudes that have driven cryptology and technology
to enable greater individual freedoms.8 The ambitions within this community no longer
merely lie within unregulated currencies, and the shift towards bitcoin weddings and
blockchain governance has given rise to a notion of ‘crypto-sovereignty’ where block-
8
David Golumbia, The Politics of Bitcoin: Software as Right-Wing Extremism, Minneapolis, MN:
University of Minnesota Press, 2016.
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chain software, protocol and encryption provide founding ideals with which to form and
experiment with exclusionary sovereign states. Blockchain platforms such as Ethereum
— a platform that allows people to write and develop code onto a custom blockchain
that can host and execute smart contracts and Decentralized Autonomous Organizations (DAOs) — encourages programmers to envision how decentralized ledgers can be
used to create consensus based systems and experiments in creating non-hierarchical
organizations. I would argue that while the libertarian crusade to undermine institutional
powers such as the state and church remains the dominant political ideology that motivates a large extent of blockchain culture, there is a committed devotion forming within
certain sub communities towards diferent software that informs ambitious visions of
crypto-sovereignty, borderless nationalism and blockchain fundamentalism.
My goal is to take_under government. Let them invite us in and do a few things.
Eventually government replaces itself on the blockchain.
—Comment from BirdsPointOfView in response to thread: ‘Using Ethereum to
create a digital political party?’9
Ethereum is a blockchain based platform that explicitly encourages developers to build
experiments in voting systems, legal applications and democratic organizations which
are broadly deined as ‘governance 2.0.’ applications. For example, Ethereum’s landing page displays a visual guide on how to ‘build a democracy on the blockchain’ and
many applications use the platform to demonstrate alternative governance structures
that use non-hierarchical voting to reach a consensus.10 The consequence of facilitating
the creation of ‘unstoppable applications’ has been that a large portion of the Ethereum community now harbours ambitious visions of how blockchain, DAOs and smart
contracts can replace traditional state governments.
Ethereum founder Vitalik Buterin maintains the belief that Ethereum will one day be
a ‘world computer’ that could potentially manage citizens through decentralized applications, or in turn via a combination of de facto coded law and self-executing software connected to Internet of Things (IoT) devices. While many experiments to ‘take
under’ government remain speculative thought experiments within the Ethereum reddit community, Bitnation has undertaken the most proliic experiment into cryptosovereignty with what it calls a ‘Decentralized Borderless Voluntary Nation’ through
situated embassies, bitcoin ID citizenships and a ‘blockchain powered jurisdiction’.11
In an attempt to transcode all existing law into coded self executing contracts, Bitnation have also tried their hand at smart contract weddings. Called Smart Love, the
contract turns the commitment of ‘legacy weddings’ into 3 deined protocols:
– Proof-of-Commitment to sustain an enduring relationship
– Proof-of-Acceptance of the union by friends and family, and the community at large
– Proof-of-Support of each other, including shared risks and shared rewards12
9
10
11
12
CuttieSark, ‘Using Ethereum to Create a Digital Political Party?’, Reddit, 1 October 2016, https://
www.reddit.com/r/ethereum/comments/55dxnq/using_ethereum_to_create_a_digital_political_
party/.
For an up-to-date list of the most recent check http://dapps.ethercasts.com/.
‘Governance 2.0’, Bitnation, 21 March 2017, https://bitnation.co/.
‘Smart Love’, Bitnation, 5 November 2016, https://blog.bitnation.co/smart-love/.
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The Smart Love experiment is yet another example of experimentation that questions the boundaries of how common and civic laws can be adapted into coded
smart contracts. The applications interface incorporates the deployment of smart
contracts within a chat messaging client that would allow for emoji and other symbols to activate coded contracts between diferent parties. The integration into
messaging applications obfuscates coded contracts into communication technology and hopes to turn messaging interactions and emoji into activations of ‘common law’. The authority of this ‘common law’ will only be created through the adoption of mass users and until then, even the developers admit that it remains purely
symbolic (for now).13 The question remains weather the current marketing strategy of ‘democratizing power’ will be efective in convincing others to participate
in ‘de-centralized borderless nations’ in favour of sovereign nation states. While
DIY experiments such as Bitnation are still in their infancy, there is very little that
deters the ambition within the blockchain community of the potential for cryptosovereignty and de-centralized governance.
The conidence within the blockchain community to eventually ‘take under’ government bodies combines both libertarian political sentiment with a spiritual belief in the
blockchain’s ungoverned autonomy. This belief came under scrutiny in June 2016
when over $50 million was leaked from a DAO with over 10,000 members. The Ethereum foundation found themselves in a diicult position — to intervene and hard fork
(rolling back all transactions to a point in time that preceded the alleged hack), or to
continue and permit the transactions associated to the hack and lose a lot of investors
and a lot of money. The majority of them voted to intervene, undermining the founding
philosophy of blockchain as an un-regulated autonomous entity, consequently splitting
the community based on difering blockchain ideas and philosophy. What emerged —
and what is important to the subject of this chapter — was a small alliance of die-hards
that expressed their devotion towards Ethereum’s roots as non-regulated — refusing
to acknowledge the new fork as it was the product of (human) intervention. This alliance continued to trade on the blocks that had been afected by the hack, forming a
devoted group of blockchain purists that divorced themselves from Ethereum and are
known as the ‘Ethereum Classic’ community:
Let it be known to the entire world that on July 20th, 2016, at block 1,920,000, we
as a community of sovereign individuals stood united by a common vision to continue the original Ethereum blockchain that is truly free from censorship, fraud or
third party interference. In realizing that the blockchain represents absolute truth, we
stand by it, supporting its immutability and its future. We do not make this declaration lightly, nor without forethought to the consequences of our actions.14
The Deceleration of Independence is interesting in many ways. Firstly, it reveals conlict between the communities’ difering crypto philosophies, and illustrates that when
things don’t go to plan, it is useful for someone to be able to step in and ix the ‘unstoppable application’. Secondly, it highlights the proto-patriotic language that represents
13
14
‘Smart Love’, Bitnation.
‘The Ethereum Classic Declaration of Independence’, The Ethereum Classic Community, 2017,
https://ethereumclassic.github.io/assets/ETC_Declaration_of_Independence.pdf.
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an emerging sovereignty within the blockchain community and an extreme devotion
with which some individuals make towards diferent blockchain legions.
At irst sight, bitcoin weddings may appear as novelty acts of public devotion but
as I have indicated, they pave the way for such further pseudo-religious and proto-patriotic acts such as the ‘statement of independence’. These language acts of
crypto-sovereignty do not occur in isolation and emerge at a time when blockchain
technology is not only being adopted by the inancial sector but NGOs and government bodies. Bitnation’s experiments into creating decentralized borderless nations
has resonated with the Estonian government to such an extent that they are now
working together on providing borderless citizenship with the e-residency program.15
This demonstrates how the initially novel, strange or more extreme fantasies within
the crypto-community emerge and get integrated within governments on an (inter)
national scale. In order to prevent, or even critically relect on such projects, it is important to articulate and engage with the political and spiritual motivations that drive
the proliferation of such applications to begin with. Failing to do so will end up with
us falling for blockchain’s ‘revolutionary potential’16 without engaging with some of
the radical sub cultures and extreme fundamental views that initiate and proliferate
projects such as e-citizenship, marriage contracts and statements of independence.
This will lead to the creative and imaginative potential getting captured and predetermined within a dominant crypto hegemony and it will become even harder to
experiment and design in this space without encountering a spiritual or extreme fundamentalism towards diferent crypto-cultures. How far away are we from blockchain
funerals, blockchain birth registries, blockchain medical records? It is already possible to encode your DNA genome onto the blockchain17 perhaps encouraging further experimentation into how bio immortality could lead to further spiritual relations
towards the permanence of blockchain and a ledger afterlife. Analyzing patriotic acts
of sovereignty, faith and wedlock should help us critique and counter the propositions made by some of the more extreme members within the blockchain community
and become aware of the spiritual beliefs that fundamentally drive the transition of
blockchain from banks and business to church and state.
References
‘Couple to use Blockchain to Contract Marriage. I'm Honored to be Oiciating’, Reddit, 25 September
2014, https://www.reddit.com/r/Bitcoin/comments/2hfwd/couple_to_use_blockchain_to_contract_marriage_im/.
CuttieSark. ‘Using Ethereum to Create a Digital Political Party?’, Reddit, 1 October 2016, https://www.
reddit.com/r/ethereum/comments/55dxnq/using_ethereum_to_create_a_digital_political_party/.
‘Estonia E-Residency Program & Bitnation DAO Public Notary Partnership’, Bitnation, 27 November
2015, https://bitnation.co/blog/pressrelease-estonia-bitnation-public-notary-partnership/.
Golumbia, David. The Politics of Bitcoin: Software as Right-Wing Extremism. Minneapolis, MN: University of Minnesota Press, 2016.
‘Governance 2.0’, Bitnation, 21 March 2017, https://bitnation.co/.
15
16
17
‘Estonia E-Residency Program & Bitnation DAO Public Notary Partnership’, Bitnation, 27
November 2015, https://bitnation.co/blog/pressrelease-estonia-bitnation-public-notarypartnership/.
Don Tapscott and Alex Tapscott, Blockchain Revolution: How the Technology Behind Bitcoin is
Changing Money, Business and the World, London: Portfolio Penguin, 2016.
‘Make a Backup of Yourself Using Bitcoin’, Genecoin, http://genecoin.me/index.html.
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‘History of Marriage in Great Britain and Ireland’, Wikipedia, https://en.wikipedia.org/wiki/History_of_
marriage_in_Great_Britain_and_Ireland.
‘How Humans Now Use the Blockchain to Declare Love and Marriage’, Blogchain.info, 14 February
2017, http://blogchain.info/post/how-humans-now-use-the-blockchain-to-declare-love-and-marriage.
‘Make a Backup of Yourself Using Bitcoin’, Genecoin, http://genecoin.me/index.html.
Rahmat and Ori, ‘Indonesian Record Museum (MURI) Bestowed a Special Award at CEO Bitcoin.co.id’,
Steemit, 5 July 2016, https://steemit.com/bitcoin/@rahmat/2gwcng-indonesian-record-museummuri-bestowed-a-special-award-at-ceo-bitcoin-co-id.
‘Smart Love’, Bitnation, 5 November 2016, https://blog.bitnation.co/smart-love/.
Tapscott, Don and Alex Tapscott, Blockchain Revolution: How the Technology Behind Bitcoin is Changing Money, Business and the World, London: Portfolio Penguin, 2016.
‘The Ethereum Classic Declaration of Independence’, The Ethereum Classic Community, 2017, https://
ethereumclassic.github.io/assets/ETC_Declaration_of_Independence.pdf.
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CONTEMPORARY
ART BETWEEN
ALGOMYSTICISM AND
FINTECH ACTIVISM
MARTIN ZEILINGER
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CONTEMPORARY ART BETWEEN
ALGOMYSTICISM AND FINTECH ACTIVISM
MARTIN ZEILINGER
Among recent artworks dealing with cryptocurrencies, the blockchain, and distributed
ledger technology (DLT), Simon Denny’s Blockchain Visionaries and Blockchain Future
States (both 2016) may be the most well-known. The works were prominently exhibited at the 2016 Berlin Biennale and at Petzel Gallery in New York City, where they
received a more than considerable amount of critical and popular attention. In tandem,
Blockchain Visionaries and Blockchain Future States form a sprawling arrangement
of sculptural pieces, display cases, canvas-based pieces, game culture paraphernalia, and A/V materials.1 All components are created in a playfully inlected documentary mode, designed to educate audiences about the technologies they concern. The
aspiration of the two works is to ‘capture the essence’ of ongoing developments in
blockchain-based computing and commerce;2 this is undoubtedly an important (and
ambitious) undertaking, considering that it is still far from obvious what the essence
of these developments might indeed be. One problem that has been identiied with
Denny’s approach3 is that the artist does little to elucidate the blockchain’s underlying
technologies in lay terms, choosing instead to focus on the narratives surrounding their
emergence and ongoing development. While technical details might invite discussion
and critiques of blockchain technology politics, a focus on blockchain narratives will
yield, at best, critiques of blockchain rhetoric, and, at worst, emulation of such rhetoric. Key aspects of the modes in which the technology in question operates may thus
be ignored, or remain obscured.
Within this vast and complicated subject matter, Denny’s works replace much-needed
critical commentary with a predominant focus on the ‘inspiring stories’4 of the companies and entrepreneurs developing blockchain-based services and applications. The
artist has frequently commented that ‘the story being told’ about these technologies is
what he felt most drawn to.5 This aligns Blockchain Visionaries and Blockchain Future
States with prevailing popular treatments of blockchain-related issues, namely a narrativization of inancial technologies that tends to mystify where it could ofer clariication
and critique, and that can come across as imprecise and uncritical.
1
2
3
4
5
A/V documentation of the works can be found at http://www.e-lux.com/architecture/
superhumanity/68703/blockchain-future-states/; http://www.petzel.com/exhibitions/2016-09-08_
simon-denny/; and http://bb9.berlinbiennale.de/participants/simon-denny/.
Isabella Kaminska, ‘Blockchain as Gosplan 2.0’, Berlin Biennale, http://bb9.berlinbiennale.de/
blockchain-as-gosplan-2-0/.
See for example Andrew Weiner, who ofers one of the more scathing reviews of Denny’s work.
Andrew Weiner, ‘Simon Denny’s “Blockchain Future States”’, Art Agenda, 25 October 2016, http://
www.art-agenda.com/reviews/simon-dennys-blockchain-future-states/.
See Kaminska, ‘Blockchain as Gosplan 2.0’.
See for example Sam Skinner, ‘Blockchain Future States – An Interview with Simon Denny’,
in Ruth Catlow, Marc Garrett, Nathan Jones, and Sam Skinner (eds), Artists Re:Thinking the
Blockchain, London: Torque Editions & Furtherield, 2017, pp. 141-155.
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Elsewhere, Denny has shown himself to be an astute and insightful critical observer
of the inner workings of digital capital (see, for example, his recent contribution to
Texte zur Kunst).6 This makes the relatively uncritical approach of Blockchain Visionaries and Blockchain Future States all the more noteworthy. Is the goal of such works to
critique shallow engagement with inancial technologies by amplifying this same kind
of engagement (perhaps in a parodic mode), thereby to draw attention to the kinds
of rhetoric that often saturate popular discussion of blockchain technologies? Or are
such works simply extensions of the same rhetoric, lost opportunities for properly critical engagement? In consideration of these questions, Denny’s work will here serve as
the backdrop for some remarks on the role of contemporary art in relation to emerging
inancial technologies. I will discuss creative approaches that border on what might
be called intech algomysticism — a substitution of technical, ideological, and socioeconomic discussion of inancial technologies for a foregrounding of their fantastic,
magical, unknowable qualities. Following such approaches, Bitcoin can easily appear
as ‘magical internet money’,7 and the complexity of distributed ledger technology can
easily render its computational foundations as superhuman. In view of this, however, it
becomes ever more important to counter algomysticism with intech activism.
Fig. 1. Magic Internet Money meme by Reddit user /u/mavensbot.
6
7
Simon Denny, ‘Face the Market on Your Own’, Texte Zur Kunst 106 (2017): pp. 124-133.
Paul Bars, ‘Magic Internet Money: How a Reddit Ad Made Bitcoin Hit $1000 and Inspired South
Park’s Art Department’, 18 February 2013, https://medium.com/@paulbars/magic-internet-moneyhow-a-reddit-ad-made-bitcoin-hit-1000-and-inspired-south-parks-art-b414ec7a5598.
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Summoning Nakamoto’s Magic
Blockchain-based cryptocurrencies and related decentralized computing were
shrouded in mystery from the very beginning. When, around 2008, the pseudonymous
‘Satoshi Nakamoto’ cast the computational spell that would go on to spawn Bitcoin
with the publication of a hugely inluential white paper, many aspects surrounding this
spell-casting were ideally positioned to forge and amplify the mysterious and mystical
qualities of cryptocurrencies and other blockchain-based applications. The real identity of the white paper’s author remains unconirmed to this day, feeding wide-ranging
conspiracy theories; the publication of the material followed closely in the footsteps
of the 2008 global inancial crisis (or was it a consolidation?), which had polarized
opinion about the state of the global economy; the ideas outlined in the white paper
emphasized faults and inequities of mind-boggling proportions underlying our dominant inancial systems, while simultaneously envisaging the creation of new wealth of
equally unbelievable proportions; and inally, the technologies engendered by Nakamoto’s white paper seemed to lack a clear ideological tack, and were therefore poised
to support radical projects ranging from the ultra-conservative to the ultra-progressive.
By emulating and mirroring popular accounts of the technology, Denny’s blockchainrelated work draws directly on many of the mystical qualities surrounding the blockchain. For example, a display case devoted to Nakamoto’s unknown identity is formally reminiscent of poster presentations at popular science exhibitions or academic
conferences, even though in terms of its content it plays directly to the conspiracy
theories surrounding this igure. Denny’s use of the popular kids’ game franchise Pokémon8 as an explanatory framework for the blockchain functions similarly, in that ultimately it serves primarily to play down the complexity of the subject matter, even in
the process of seemingly clarifying it. Overall, Denny’s mirroring of vague blockchainrelated rhetoric raises questions concerning the role of contemporary art in recognizing
and exposing the fabulations currently surrounding the blockchain. Do communities
of contemporary artists and art critics, many of them presumably critical of global
capital, share an obsession with narratives perpetuating the magic and mystery of
emerging inancial technologies (in an updated version of Marx’s riddle of the money
fetish?) How can contemporary art cut through prevailing intech mysticism so that,
rather than regurgitating befuddling narratives prevalent in popular accounts, art could
develop properly critical perspectives on the subject, to move from intech mysticism
to intech activism?
Roughly a decade after Nakamoto, cryptocurreny technology is now well-documented
and explained both in specialist and in lay contexts. There isn’t a need, it would seem,
to consider them as mythical entities descended from the digital heavens (or risen
from a digital hell). An abundance of examples nevertheless indicates that the mystical qualities of the technology continue to be purposefully perpetuated and even
ampliied. Take, for example, Bitcoin Golem, a recently founded (and already defunct)
cryptocurreny trading company that was positively otherworldly both in its name and in
8
For in-depth visual documentation of Denny’s use of Pokémon imagery, visit the Petzel Gallery
website at http://www.petzel.com/exhibitions/2016-09-08_simon-denny/.
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terms of its return-of-investment promises (e.g., ‘1% Hourly Forever’).9 For another example, take the distributed computing system Ethereum,10 which is built around transactions of value tokens bearing the mystically evocative name ‘Ether,’ uses as its logo
two loating, semi-translucent pyramids, and which has been deeply embroiled in a
looming algo-inancial day of reckoning (Ethereum’s superseding of Bitcoin) popularly
called ‘The Flippening’.11 Such language can only serve to cement the mystical status
of blockchain applications, rather than challenging it. Contemporary art, if it wants to
participate meaningfully in discourses on digital capital, has to recognize an obligation
to engage its subjects critically, whether it is performatively (i.e., through technological means) or through narrative inlection and subversion. Documentation and playful
adoption of obfuscating narratives is not enough.
Art, in particular experimental art and the avant-garde, has always played a key role
in investigating political and socio-economic developments that are diicult to register in more institutionalized frameworks, and in attempting a recuperation of the
radical in everyday life, as Peter Bürger has so memorably (if contentiously) formulated.12 What could this mean in the context of emerging inancial technologies, speciically related to the blockchain? As a irst example, we might think of Dutch artist
Femke Herregraven’s ongoing series Rogue Waves, begun in 2015.13 Rogue Waves
is a sculptural work that plays on the object of the tally stick, what might be called
a pre-print ledger. As analogue storage devices for inancial information, used by
ancient cultures to record transactions and holdings (this was done, for example, by
carving notches in bone), tally sticks strike a curious balance between fetish object
and inancial technology. In Herregraven’s sculptures, the sticks have become rectangular, carved aluminum poles that carry engravings of information about illegal
algorithmic stock-market manipulation through high-speed trading. The artist thus
visualizes computational inancial activities and data in physical form, and creates
aesthetic objects whose deceptively beautiful patterns trace the malevolence of digital capital. Notably, the artist chooses to do so in an ancient object-type which, like
money itself, carries totemic qualities that are here instrumentalized in a critique of
rogue trading practices.
Techno-Utopianism Begets Algomysticism
The initial appearance of blockchain-based cryptocurrency technology in the Nakamoto white paper was a punctilious, sharp stab in the side of existing inancial technology
and economic theory, a storm of utopian dimensions brewing on the horizons of digital
capital. The lood of experimentation and innovation it triggered quickly took on mystical dimensions. This should perhaps not be surprising — surely, to laypeople and even
many specialists, the core ingredients of blockchain applications, including algorith-
9
10
11
12
13
Bitcoin Golem (formerly located at https://bitcoingolem.com) ceased operation during the summer
of 2017, only a few months after its founding in March of that year. However, online image
searches for the company name still yield most of the site’s content.
See the Ethereum Project home website at https://ethereum.org/.
A good place to track this process is the Flippening Watch website, at https://www.lippening.
watch/.
See Peter Bürger, Theory of the Avant-Garde, Minneapolis, MN: University of Minnesota Press,
1984.
For documentation of Femke Herregraven’s work, visit her website at http://femkeherregraven.net/
rogue-waves-ii-scar-tissue/.
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mic encryption, trustless transaction, decentralized information storage, self-enforcing
contracts, and decentralized autonomous organizations, must appear as bewildering
conjurations emerging from the realms of the unreal and superhuman.
Consequently, examples of mainstream blockchain mysticism abound. Most of
them are richly varnished with slogans and imagery that invoke unthinkable wealth
forming somewhere in a chaotic, cosmic churn of informational bits, yielding riches
that loat through virtual, intergalactic space. In addition to already-mentioned internet memes portraying Bitcoin as magical internet money, here we might also
include the depiction of Ethereum’s founder as a wealth-conjuring sage (such illustrations, often found on ‘EthTrader’ and similar discussion threads, frequently
supplement interviews with Vitalik Buterin);14 the incessant framing of mainstream
intech ‘inancial analysis’ in the rhetoric of soothsaying (e.g., ‘A $2,000 Bitcoin (and
9 Other 2017 Blockchain Predictions)’;15 and frequent references to biblical imagery
in commentary on current developments in the cryptocurrency landscape.16 Denny’s work relects such rhetoric in the integration of intech-related information with
references to massively popular ictions of Western mainstream culture, such as
when Denny describes the Ethereum founder Vitalik Buterin as ‘the Luke Skywalker
of the cryptocurrency circuit’.17
To some extent, these examples are linked to techno-utopian ideas regarding the
radical changes that blockchain-based inancial services are supposed to bring.18
However, they add a signiicant dimension to traditional techno-utopianism, and represent an important rhetorical shift in focus. Techno-utopianism tends to be characterized by a language of revolutionary change, and thus carries important political
dimensions; it is linked to a (real or imagined) mastery of a given technology for a
common good. But when blockchain-based technologies are furnished with mystical qualities, when they are discussed as magical, otherworldly, or superhuman, the
techno-utopian belief that a technology can be put to good (radical) use will give way
to the algomystical assumption that, for better or worse, the technology in question
exists outside the reach of human control (incidentally, this is a major selling point
of supposedly ‘incorruptible’ blockchain-based systems), and that the technology is
quasi-unknowable in an almost godlike fashion.
14
15
16
17
18
See for example John Frost, ‘Interview With Vitalik Buterin About Next Generation For
Cryptocurrencies’, The Coin Telegraph, 8 December 2015, https://cointelegraph.com/news/
interview-with-vitalik-buterin-about-next-generation-for-cryptocurrencies; for a popular Ethtrader,
see https://www.reddit.com/r/ethtrader/comments/6tamgo/what_is_the_origin_of_the_vitalik_
jesus_lambo/.
Ajit Tripathi, ‘A $2,000 Bitcoin (and 9 Other 2017 Blockchain Predictions)’, Coin Desk, 4 January
2017, https://www.coindesk.com/2000-bitcoin-9-2017-blockchain-predictions/.
See for example http://i.imgur.com/QJcqH3A.jpg.
See Nadja Sayej, ‘Simon Denny: the artist explaining blockchain with Pokémon,’ The Guardian,
26 August 2016, https://www.theguardian.com/artanddesign/2016/aug/26/simon-denny-artistblockchain-pokemon.
Cf. Howard Segal, ‘The Technological Utopians’, in Joseph Corn (ed.), Imagining Tomorrow:
History, Technology and the American Future, Cambridge, MA: MIT Press, 1986.
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Fig. 2. Etherium Lambo meme portraying Vitalik Buterin by Reddit user /u/earthquakequestion.
There are many examples demonstrating how such qualities are reinforced rhetorically
and narratively, more or less overtly. Bitcoin Golem, the cryptocurrency trading company mentioned above, demonstrated this conceit extremely well. The now-defunct
company was recently exposed as a scam that promised its investors wildly unrealistic
proits that were supposed to be based simply on the totemic ownership of (a.k.a. ‘investment in’) cryptocurrency units. While operational, the company website, which had
been registered with a London business address in March 2017, was characteristically
opaque about the company’s corporate structure, and equally unclear about how its
investment schemes worked.19 For example, Bitcoin Golem’s ‘Gold Plan,’ supposedly
available to no more than 50 investors, promised a proit of 12,000% after 8 days,
based on a minimum deposit of 0.12 Bitcoins. A golem, as everyone with as little as
19
See footnote 9.
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a passing interest in the history of religion (or steampunk sci-i) will know, is a virtually
indestructible automaton, often constructed out of numerous amorphous pieces, that
is incorruptible in ideal conditions, but which can also go dangerously out of control.
As a kind of mystical robot, a golem appears nearly godlike and insurmountable, and
does the bidding only of those who can recode the encrypted trigger needed to turn
the automaton on and of (called the shem in Hebrew mysticism). This hardly sounds
like a secure (let alone fool-proof) inancial technology. When a cryptocurrency trading
operation is called Bitcoin Golem, and when the owners of the service invoke fantastical rhetoric of unimaginable wealth rather than ofering any explanation of how their
magical system functions, then the conditions for a shift from techno-utopianism to algomysticism are certainly met — indeed, any knowledge of and trust in the underlying
technology will rely on mystiied devotion. Arguably, a similar approach appears to be
embodied in some of Denny’s work, particularly where it depicts entrepreneurial, hyper-capitalistic distributed ledger technology applications through references to popular games. Using Pokémon to explicate the blockchain serves, by implication, to imbue
the technology in question with the fantastical qualities of the game world. In Pokémon
video games (as in the many narrative versions of the franchise, existing in the form
of graphic novels, TV shows, and collectibles) protagonists and players are constantly
on the hunt for the valuable supernatural beings from which the franchise derives its
name, which are religiously worshipped as powerful totems. In the extended metaphor
of Denny’s work, Pokémons become units of supernatural cryptocurrency, and cryptocurrency trading itself becomes a game. By implication, the underlying distributed
ledger technologies are depicted as an esoteric, fantastical phenomenon which, like
Pokémons (and like the Pokémon phenomenon itself), may be hard to grasp for the
uninitiated, despite its massive popularity. Here, the technology is infantilized, and
presumably game-like characteristics are foregrounded, while serious socio-economic
concerns are ignored.20
When the algomysticism of blockchain technology applications and products is less
overt than in examples such as the naming conventions of Ethereum, mainstream
advertisement strategies, or the game culture contextualization in some of Denny’s
work, then it frequently takes on pseudo-educational forms. The outcome has been
a multitude of cryptocurrency ‘academies,’ many of which advertise aggressively on
social media platforms, ofering for sale supposedly informative materials (in the form
of workshops, seminars, retreats, pamphlets, etc.) that are almost always framed as
enlightening, semi-religious doctrine promising epiphanies on cryptocurrency trading.
A current sampling of some of the oferings currently crowding my Facebook feed (the
platform’s algorithms are translating my research interests in truly mysterious ways) include the following: Remitano, a trading platform registered in the Seychelles, features
a banner ad with a gold-colored cryptocoin graphic emblazoned with the Bitcoin symbol and an ininity symbol, loating among the stars. The image taunts me to become
a multi-millionaire ‘CryptoPreneur!’ through subscription to a number of workshops. A
mouse-click away, the banner photo of an organization simply called ‘CryptoCurrency
Academy’ asks me, provocatively and in all caps, ‘WHO CONTROLS THE CREATION
20 See also Max Haiven, ‘Coming of Age in the Financialized Pokéconomy’, 12 July 2016, https://
maxhaiven.com/2016/07/12/pokeconomy/.
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OF MONEY?’,21 implying that it is entirely within the means of the academy to impart
this godlike power. This organization, in turn, is linked to OneCoin, a cryptocurrency
platform widely reported to be an elaborate scam (recently, authorities shut down a
major annual convention for OneCoin users and investors in Macau, which had been
advertised with images invoking Michelangelo’s The Creation of Adam fresco to suggest a holy union between cryptocurrencies and capitalist riches).22 Gibraltar-based
OneCoin is headed by the guru-like igure of ‘Dr. Ruja Ignatova,’ and operates primarily
by selling educational material in the form of digital pamphlets. These seem designed
to indoctrinate users to esoteric belief-systems sustaining the proprietary trading platform and currency system, which essentially functions like a pyramid scheme.
A main shared characteristic of many blockchain-related ‘academies’ is that they are
set up as temples rather than as educational institutions: they cultivate the assumption that users need to ‘learn’ about cryptocurrencies, a desire that is satisied through
various pagan catechisms of crypto-inance (usually paid-subscription informational
material promising the privilege of joining an inner circle of initiates to become true
disciplines). Importantly, this rarely includes detailed information about the underlying
technologies themselves. The blockchain, the technology around which transactions
revolve, is here posited as being so diicult to understand that it borders on the unknowable, again shifting blockchain-based applications towards the mystic. Just as
church-going is supposed to give me access to the word of God, but no guarantee that
I will ever really understand it, joining one of the many existing algomysticist cryptocoin
cults is a choice to believe in a technology, rather than a serious attempt to understand
it. It is in this sense that the text-based and visual rhetoric surrounding trading technologies and platforms reinforces and ampliies the lack of clarity, even where it is packaged in pseudo-explanations, and thus continues the algomysticism outlined above.
Some of Denny’s work picks up on this kind of rhetoric, which is here referenced in a
mock-documentary mode that emulates the mystifying and mystical attitudes already
discussed. A central component of Denny’s 2016 exhibition at Petzel Gallery was what
the gallery PR text described as ‘sculptural infographics’;23 while some of these infographics elevate Blockchain ‘visionaries’ like Ethereum founder Buterin into a mystical
realm, others pull elusive intech characters like Nakamoto into the real. Overall, this
approach serves to reshape speculative content as content that appears documentary
in nature, and the viewer’s attention is drawn to the mystical dimension of the technology under discussion. A short video included in the project is a good example of this.
The video summarizes technical features of the blockchain in a fashion that is reminiscent of TV infomercials. Against the visual background of a stylized globe of connected
informational nodes loating through the cosmos, a voice-over narrative is delivered
by a resonant male voice that might as well be talking about religion, the mysteries
of the deep sea, or outer space: ‘The blockchain is the truth. It is a system enabling
each and every one of us to take part in the real, vast, marvelous ever-changing pattern of human interaction governed only by ourselves, enabled by a code belonging to
21 See https://www.facebook.com/OneCoinCryptocurrencyNow/.
22 See ‘OneCoin Global Macau Event Prohibited by Chinese Authorities’, Behind MLM, 28 April 2017,
http://behindmlm.com/companies/onecoin/onecoin-global-macau-event-prohibited-by-chineseauthorities/.
23 See ‘Simon Denny’, Petzel, 8 September 2016, http://www.petzel.com/exhibitions/simon-denny3.
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all, relecting all.’24 According to Denny, the purpose of the video was to ‘explain the
technology at a very basic level, but also to contextualize the explanation by being
partly propaganda-like, including emphasizing some of the economic and ideological
assumptions [underlying the blockchain] as a given.’25 The result, however, much like
the oferings of the pseudo-educational cryptocurrency academies discussed above,
feels mantra-like rather than explanatory, catechistic rather than informative.
Non-Fintech intech and the critical role of contemporary art
In a review in The Guardian, Denny has been described as a ‘technology inance
groupie’ who makes ‘fan art,’ and who, in this project, uses the gallery as ‘an altar to
worship’ important blockchain igures.26 Denny has conirmed this perspective, for example by stating, ‘I am a fan of the culture of entrepreneurship. An artist is also a business… The values associated with entrepreneurship seem very close to me. Highly
motivated people with high-risk precarious ideas mixed with eiciency and metrics.
What could be more beautiful?’27 A question to volley back to the artist here might be
something like the following: What, given this viewpoint, distinguishes the artist’s perspective on the blockchain from the pseudo-educational scam pamphlets of OneCoin,
or from the fantastical promises of companies like Bitcoin Golem? According to Denny,
Blockchain Future States and Blockchain Visionaries are projects that want to inform
viewers. But, as I have suggested above, the artist’s approach of adopting reverential
and mythologizing stances do little more than to aestheticize the blockchain while
perpetuating vague narratives without producing critical insight around cryptocurrency
issues. Denny has stated that for him, assuming the speculative position of ‘what if’ –
‘what if we accept [technologies] on the terms they are publicized with, with the terms
of the community that is presenting the ideas and building the infrastructure, what
would the implications of that be?’ — represents a critical position.28 I am doubtful that
adopting such a position can amount to an efective rhetorical strategy for ‘opening
up questions and discussions’29 around blockchain-related technology and politics,
or that it can convey the skepticism and inspire the open-mindedness towards which
newcomers to emerging inancial technologies should be guided.
Blockchain discourse in an algomysticist vein tends to overlook or ignore the need to
engage the emerging technologies it is concerned with analytically, and with a critical
awareness of socio-economic implications. Algomysticism espouses the beneits that
we can supposedly derive from the technologies in question, and the harmony in which
we can supposedly co-exist with them, without accepting the need to understand
and critically interrogate these same technologies and the socio-political realities they
produce. In mainstream contexts that follow proit-seeking angles, and that aim to
exploit lacking knowledge of inancial technologies, the mysticism enshrouding the
blockchain is understandable. In these contexts, the rhetoric is strategic, designed
24 The video is embedded at http://www.e-lux.com/architecture/superhumanity/68703/blockchainfuture-states/.
25 See Skinner, ‘Blockchain Future States’, p. 142.
26 See footnote 11.
27 See ‘Artist SIMON DENNY is Shaping Berlin’s Disruptive Startup Culture’, 032c, 31 January 2014,
https://032c.com/2014/artist-simon-denny-is-shaping-berlins-disruptive-startup-culture/.
28 See Skinner, ‘Blockchain Future States’, p. 144.
29 Ibid.
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to ensnare users in unpredictable, high-risk ‘investment’ activities. By contrast, art
practices that engage emerging inancial technologies have an opportunity — and,
in my view, an obligation — to expose problems and explore alternatives. They must
proceed tactically, cutting through the mystifying rhetoric of for-proit scams instead
of emulating it. Experimental art practices have always functioned as laboratories in
which the meanings, contours, and limits of emerging technologies can be discovered
and challenged, and many intech examples are available, such as Femke Herregraven’s work referenced above.
In a non-DLT context, the much-discussed work of the Robin Hood Coop, with its custom-designed algorithm that mimics the behavior of successful investment operations,
comes to mind as a powerful (if contested) example of working through the critical
implications of inancial technologies.30 Yes, it can be hard to understand how precisely
the group’s ‘parasitical’ trading algorithm and ‘activist’ hedge fund can be framed as
an art project. The point is that the Robin Hood Coop simultaneously is and isn’t art,
and that the resulting contentions and contradictions open up extremely productive
sites of critical thinking and critical practice. Despite its name, the Robin Hood Coop
technically doesn’t steal anything, but beneits from the proitable, if ethically corrupt,
capitalist investment strategies it copies; if this diminishes the project as an artwork, it
certainly raises important and uncomfortable questions – on the one hand, about the
technologies used, and, on the other, about the nature of critique itself, about systemconformity of the art world, and about the limits of radical creative practice.
What might such practices look like in the context of blockchain technologies? Undoubtedly, blockchain-based digital art has a great potential for similarly contentious,
diicult, and efective critiques. Speciically, such art might be most powerfully poised
to engage with questions of the value and valuation, uniqueness, ownability, and tradability of artworks — issues that commercial blockchain applications are also designed
to tackle, openly and directly. The important thing is that such art practices must be
positioned outside the mystifying rhetoric that is found, as discussed, in so many places. One way to achieve this might be to create works that don’t document, narrativize,
or aestheticize the blockchain, but which, like the work of the Robin Hood Coop, produces subversive inlections and sites of critical debate through copying or mimicry.
This would mean artworks that engages DLT productively, and that might shape what
DLT can become because it is itself open to becoming DLT. In this sense, to use intech
does not necessarily mean to be intech (see, again, the Robin Hood Coop).
Some of the most interesting artistic projects using emerging inancial DLT do so in
order to explore how the technology used can undermine aspects of traditional ownership structures (e.g., the ownership of artistic artifacts; ownership of the modes of
production, circulation, and distribution of art; and control over the institution that (e-)
valuate artistic output). Ultimately, this might help us think about the reconiguration
(or abandonment?) of these structures — something that conceptual art, for example,
has attempted (and failed) to do for decades throughout the mid-20th century.31 If we
30 See http://www.robinhoodcoop.org/.
31 Cf. Martin Zeilinger, ‘Everything You’ve Always Wanted to Know About the Blockchain* (*But Were
Afraid to Ask Mel Ramsden)’, in Artists Re:Thinking the Blockchain, op. cit., pp. 287-296.
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take the blockchain seriously as a substrate for critical art-making, then this calls for
an art that engages with the technology rigorously and critically in order to explore and
expose its capabilities, limits, and potential dangers. One form this is already beginning to take is that of self-owning artworks, such as Plantoid (2015) and terra0 (2016),
both of which were featured in the recent Furtherield exhibition ‘New World Order’.32
Plantoid has been discussed extensively in critical and creative communities over the
past years; it is a blockchain-based sculpture capable of managing its own existence
by controlling its wealth as represented in Bitcoins, and using this capital to commission additional copies of itself, which are then again sold, allowing the artwork to expand and grow. Following a similar principle, terra0 is a self-owning and self-managing
forest designed to manage its own existence and growth in a sustainable fashion.
Both works are — and are not — intech. Engaging with these works is instructive
with regard to the functionality of the underlying technologies. But ultimately, they also
open up broader and more far-reaching avenues of inquiry. They help us rethink the
blockchain, and, more generally, force us to reconsider the nature of the work of art
in the age of DLT. A serious engagement of the issues raised by works such as terra0,
and its highly rigorous non-mythologizing engagement with DLT, will yield a new perspective on the role of the artist in relation to the work, and a new agency of art in the
world. This is not simply about decoupling art from its institutions and its markets (or
empowering it with regard to them). Rather, what could emerge out of this exploration
is a blockchain-based art that is — precisely thanks to its direct engagement with
inancial technologies — not merely a inancial technology. While the blockchain can
thus certainly serve to inancialize art,33 by contrast it might also serve to make it uninancializable. This might serve to cut the corruptible, biased, greedy, selish human out
of the transactional equation — after all, to eliminate inancial institutions as inevitable
middlemen was, we must remember, the original promise of the blockchain. Contemporary art that engages meaningfully with the blockchain, then, should be inevitably
orientated towards a radical emancipation of the artwork, and an exploration of a new
kind of agency that the artwork can have vis a vis the artist. With this, contemporary art
can perhaps return to operating in a utopian mode, shifting into activist work in numerous ways. As a kind of emergent non-intech intech, this is no doubt preferable to the
algomysticism discussed above.
References
‘Artist SIMON DENNY is Shaping Berlin’s Disruptive Startup Culture’, 032c, 31 January 2014,
https://032c.com/2014/artist-simon-denny-is-shaping-berlins-disruptive-startup-culture/.
Bars, Paul. ‘Magic Internet Money: How a Reddit Ad Made Bitcoin Hit $1000 and Inspired South Park’s
Art Department’, 18 February 2013, https://medium.com/@paulbars/magic-internet-money-how-areddit-ad-made-bitcoin-hit-1000-and-inspired-south-parks-art-b414ec7a5598.
Bürger, Peter. Theory of the Avant-Garde, Minneapolis, MN: Univ. of Minnesota Press, 1984.
Denny, Simon. ‘Face the Market on Your Own’, Texte Zur Kunst 106 (2017).
Frost, John. ‘Interview With Vitalik Buterin About Next Generation For Cryptocurrencies’, The Coin
Telegraph, 8 December 2015, https://cointelegraph.com/news/interview-with-vitalik-buterin-aboutnext-generation-for-cryptocurrencies.
Haiven, Max. ‘Coming of Age in the Financialized Pokéconomy’, 12 July 2016, https://maxhaiven.
32 See http://furtherield.org/programmes/exhibition/new-world-order.
33 Cf. Martin Zeilinger, ‘Digital Art as “Monetised Graphics”: Enforcing Intellectual Property on the
Blockchain’, Philosophy & Technology (2016), https://link.springer.com/article/10.1007/s13347016-0243-1.
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com/2016/07/12/pokeconomy/.
Kaminska, Isabella. ‘Blockchain as Gosplan 2.0’, Berlin Biennale, http://bb9.berlinbiennale.de/blockchain-as-gosplan-2-0/.
‘OneCoin Global Macau Event Prohibited by Chinese Authorities’, Behind MLM, 28 April 2017, http://
behindmlm.com/companies/onecoin/onecoin-global-macau-event-prohibited-by-chinese-authorities/.
Sayej, Nadja. ‘Simon Denny: The Artist Explaining Blockchain with Pokémon,’ The Guardian, 26 August
2016, https://www.theguardian.com/artanddesign/2016/aug/26/simon-denny-artist-blockchainpokemon.
Segal, Howard. ‘The Technological Utopians’, in Joseph Corn (ed.), Imagining Tomorrow: History, Technology and The American Future, Cambridge, MA: MIT Press, 1986.
‘Simon Denny’, Petzel, 8 September 2016, http://www.petzel.com/exhibitions/simon-denny3.
Skinner, Sam. ‘Blockchain Future States – An Interview with Simon Denny’, in Ruth Catlow, Marc
Garrett, Nathan Jones, and Sam Skinner (eds), Artists Re:Thinking the Blockchain, London: Torque
Editions & Furtherield, 2017.
Tripathi, Ajit. ‘A $2,000 Bitcoin (and 9 Other 2017 Blockchain Predictions)’, Coin Desk, 4 January 2017,
https://www.coindesk.com/2000-bitcoin-9-2017-blockchain-predictions/.
Weiner, Andrew. ‘Simon Denny’s “Blockchain Future States”’, Art Agenda, 25 October 2016, http://
www.art-agenda.com/reviews/simon-dennys-blockchain-future-states/.
Zeilinger, Martin. ‘Digital Art as “Monetised Graphics”: Enforcing Intellectual Property on the Blockchain’, Philosophy & Technology (2016), https://link.springer.com/article/10.1007/s13347-016-02431.
_____. ‘Everything You’ve Always Wanted to Know About the Blockchain* (*But Were Afraid to Ask Mel
Ramsden)’, in Ruth Catlow, Marc Garrett, Nathan Jones, and Sam Skinner (eds), Artists Re:Thinking
the Blockchain, London: Torque Editions & Furtherield, 2017.
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FINANCIALIZATION
AS A MEDIUM:
SPECULATIVE NOTES
ON POST-BLOCKCHAIN
ART
LAURA LOTTI
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FINANCIALIZATION AS A MEDIUM: SPECULATIVE NOTES
ON POST-BLOCKCHAIN ART
LAURA LOTTI
There are two art markets today. One is still regulated by a hierarchy of values,
even if these are already of a speculative kind. The other resembles nothing so
much as loating and uncontrollable capital in the inancial market: it is pure
speculation, movement for movement’s sake, with no apparent purpose other than
to defy the law of value. This second market has much in common with poker or
potlatch — it is a kind of space opera in the hyperspace of value. Should we be
scandalized? No. There is nothing immoral here. Just as present-day art is beyond
beautiful and ugly, the market, for its part, is beyond good and evil
—Jean Baudrillard.1
Art is produced as a commodity, it doesn’t become one when it is sold
—João Enxuto and Erica Love.2
Introduction
With the changing funding paradigm for the arts in neoliberal economies, which is
increasingly a prerogative of private institutions and corporations, the relation between
art and inance has acquired growing prominence within art discourses and practices.3
Beginning in the 1960s when the irst large professional investors entered the realm of
art investment, the inancialization of art is not a new phenomenon. However, in the last
decade it has displayed unprecedented levels of professionalization, standardization,
and ‘scientization of art investment’,4 aiming to turn art into a tool for portfolio diversiication and inlation hedging. In other words, inancialization has turned art into an
asset, commensurable to any other tradable commodity. This has encountered a mix
1
2
3
4
Jean Baudrillard, The Transparency of Evil: Essays on Extreme Phenomena, trans. James Benedict,
London: Verso, 1993, pp. 18–19.
João Enxuto and Erica Love, ‘Institute for Southern Contemporary Art,’ The Original Copy, 2016,
http://theoriginalcopy.net/isca/.
For instance, in May 2017, Donald Trump’s 2018 budget proposed to eliminate altogether the
National Endowment to the Arts, as part of a dramatic cut to federal funding. Eileen Kinsella,
‘Trump Budget Proposes to Eliminate the NEA’, Artnet News, 23 May 2017, https://news.artnet.
com/art-world/trump-budget-proposes-steep-cuts-to-arts-funding-969641. In Australia the
number of grants to individual artists has decreased by a stunning 70% since the 2013-14
inancial year – a trend, which has been maintained in the 2016-17 Federal Budget. Alison
Croggon, ‘The 70% Drop in Australia Council Grants for Individual Artists is Staggering’, The
Guardian, 18 May 2016, http://www.theguardian.com/culture/2016/may/19/the-70-drop-australiacouncil-grants-artists-funding-cuts. Suhail Malik and Andrea Phillips characterize this shift as
the passage from an ethos of ‘public care’ to one of private ‘love of art,’ which today drives the
dynamics in art market prices. Suhail Malik and Andrea Phillips, ‘Tainted Love: Art’s Ethos and
Capitalization’, in Maria Lind and Olav Velthuis (eds), Art and Its Commercial Markets: A Report on
Current Changes and with Scenarios for the Future, Berlin: Sternberg Press, 2012, pp. 209–40.
For a thorough overview of the historical progression of the inancialization of art, see Olav
Velthuis and Erica Coslor, ‘The Financialization of Art’, in Karin Knorr Cetina and Alex Preda (eds),
The Oxford Handbook of the Sociology of Finance, Oxford: Oxford University Press, 2012.
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of resistance and fascination by the art community and a new level of awareness with
regard to the extent to which market dynamics bleed into the fabrics of the art milieu.
This is because the art asset perfectly illustrates the tensions within the current logic
of inancialization in relation to the socio-cultural sphere. On the one hand, it exposes
the inner limits of market valuation methods that, through processes of quantiication,
standardization and commensuration, aim to latten the heterogeneity of cultural and
aesthetic values onto the metric of price — without, however, subsuming them entirely.5 On the other hand, it emphasizes the ‘derivative’ condition of contemporary art in
computationally mediated culture, which today is valued, both socially and economically, according to algorithmic rules that map well onto the logic of derivative markets.6
Acknowledging art’s entanglement with private inancial interests, artists and cultural
practitioners have begun exploring the new afordances7 provided by blockchain technology and crypto-tokens in order to propose alternatives to the current paradigm.
Tokens are an intrinsic component of the disintermediated logic of the blockchain architecture, enabling the creation and transmission of programmable units of value in
a peer-to-peer way. As I will explain in more depth below, in token-based networks
every blockchain-mediated interaction corresponds to a transaction that occurs outside of established inancial markets, portending a shift toward an even more ubiquitous inancialization of everything through blockchain. However, as recent art projects
make clear (such as the ones I will discuss below — BitchCoin and terra0), this also
ushers in new social and inancial possibilities for the art ield and, more broadly, for
any endeavor seeking autonomy from the contemporary inancial ecosystem through
creativity and invention.
Taking seriously the promise (and dangers) of tokenization, and envisioning a blockchain-based future in which inancialization through tokens becomes seamlessly integrated into the fabrics of everyday life, this essay asks: given the relevance of postinternet art in foregrounding the aesthetic and operational dimensions of the derivative
condition of contemporary art in current networked culture, what would a ‘post-blockchain’ future for art actually look like? By which I mean: what would it mean for art to
rely on blockchain technology (instead of the current internet stack) for its process of
5
6
7
This is due to the very nature of the art object – an illiquid and costly commodity (in terms of
storage and insurance expenses) in an unregulated and opaque inancial environment. See Clare
McAndrew (ed.), Fine Art and High Finance: Expert Advice on the Economics of Ownership, New
York, NY: Bloomberg Press, 2010.
I discussed this, through a slightly diferent approach, in Laura Lotti, ‘Contemporary Art,
Capitalization and the Blockchain: On the Autonomy and Automation of Art’s Value’, Finance and
Society 2.2 (19 December 2016): 96–110.
Afordance is a working term for me that relates to the propositional character of things and
objects and the potentials they yield for shaping new uses and behavioral patterns through their
forms and operations. It is a concept used in several disciplines such as psychology, humancomputer interaction, industrial design and anthropology. In Don Norman, The Design of Everyday
Things, New York, NY: Basic Books, 2002 [1988], p. 9, one of the seminal texts in interaction
design, Norman deines afordances as ‘the perceived and actual properties of the thing,
primarily those fundamental properties that determine just how the thing could possibly be used.’
Furthermore, he observes that the afordances of objects 'convey messages about their possible
uses, actions, and functions' (p. 82). In this case, I use the term to convey the new social and
economic possibilities introduced by digital objects such as blockchains and tokens through their
use and modes of operations, inlecting perceptions and behaviors.
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production and circulation? What tendencies would it harbor and how could they be
leveraged for art’s autonomy? Given the embryonic development of the crypto-ecosystem, this question may sound premature. However, as blockchain is increasingly
capturing the imagination of artists, technologists, and capitalists alike, it becomes
crucial for the art ield to start engaging, through the technology itself, with the possibility of a post-blockchain art. As BitchCoin and terra0 show, only by acknowledging
the inherently inancialized nature of the art asset and its embeddedness in a network
of social and inancial relations, art can be at the forefront of new modes of organizing
toward one possible future, as foreshadowed by these new technologies. As such,
these notes embrace the speculative nature of what they unashamedly propose: a vision for a future in which inancialization becomes an art form and a propelling force for
autonomous projects, thanks to the afordances introduced by blockchain technology.
Derivative Art and the Promise of Blockchain Technology
Lying at the junction between the new afordances provided by networked technology and inancialization, ‘post-internet art,’ as a now historicized style, corresponds
to the aesthetics that made explicit the new derivative condition of the art milieu. Arising in the aftermath of the Global Financial Crisis, post-internet art grappled with the
changing conditions of production and circulation of the art object — from material
and labor-intensive, to unabashedly dematerialized and luidiied — exposing the contradictions inherent in contemporary art’s ‘informational milieu’.8 Post-internet artists
acknowledged the increasing reliance by the ield on social media’s algorithmic mode
of parsing, ordering and matching data as indices of relations, to evaluate what is
considered art and how much it can be worth. Furthermore, they denounced the fact
that this automated mode of ordering neutralizes art’s critical thrust through homeostazising feedback loops, revealing the limits of representation as a mode of critique
in digital environments. Ben Vickers, in conversation with Brad Troemel and Artie Vierkant, poses the problem well in relation to Facebook’s newsfeed logic: ‘Hidden from
the sight of users, a generative system has been developed to mine the implicit and
explicit actions of millions of users globally […] condemning the user to experience all
social relations through the lens of Facebook’s inancially weighted algorithms’.9 Vickers’ observation well encapsulates post-internet art’s inherently ‘derivative’ condition:
analogously to a inancial instrument, it luctuates according to the relationality of its
own ield of operation without ever touching the ground of the underlying reality it is
supposed to be embedded in.10
This is because the reach of inancialization into the arts cannot be thought apart from
the digital networked platforms that provide the substrate and infrastructural reality
8
Curator Ceci Moss deines art's informational milieu as the ‘dynamic process of exchange among
artist, artwork, and network’ made possible by today’s networked culture, which encompasses
cultural and technical, but also institutional and inancial relations. Ceci Moss, ‘Expanded Internet
Art and the Informational Milieu’, Rhizome, 19 December 2013, http://rhizome.org/editorial/2013/
dec/19/expanded-internet-art-and-informational-milieu/.
9 Brad Troemel, Artie Vierkant, and Ben Vickers, ‘Club Kids: The Social Life of Artists on Facebook’,
DIS Magazine, 2012, http://dismagazine.com/discussion/29786/club-kids-the-social-life-ofartists-on-facebook/.
10 For a brilliant exposition of the relational nature of the derivative form see Melinda Cooper,
‘Turbulent Worlds: Financial Markets and Environmental Crisis’, Theory, Culture & Society 27.2–3
(2010): 167–90.
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upon which social, cultural and economic value is produced, distributed and harvested
in the current paradigm.11 This paradigm is coextensive with the World Wide Web infrastructure, in which value is generated through the freely available communicative
afordances of the protocol layer (such as TCP/IP, HTTP, SMTP). However, such value
is immediately captured and re-aggregated as tradable data at the application layer
through the centralized ownership of information by a few tech giants (e.g. Google,
Facebook, Amazon, etc.).12 In this context, what counts as art becomes evaluated
through the discretization, automation and commodiication of informational interactive processes (e.g., relations between artists-artworks-networks) at the application
layer. While standing for ‘appreciation’ (in the form of likes, retweets, tags, shares,
etc.), these informational processes also drive the valuation methods at the heart of the
art market, as they are also being monetized in the reputation and attention economy
– and from which it seems impossible to disentangle. This exposes the complexities of
the logic of inancialization and its inherently networked nature, based on speciic ways
in which notions of value, logic, meaning, and governance are woven in the computational architecture that creates and sustains the current system of power.
In order to break away from the entanglement with market logic, artists have started
exploring the possibilities of blockchain technology and its promise of peer-to-peer
disintermediated value creation and transmission as a way to move beyond the inancialization of art. While a technical discussion of the blockchain protocol is beyond
the scope of this essay, my goal here is to foreground the new kinds of inancial (but
also social and aesthetic) possibilities that this particular data structure opens up for
how value is generated and distributed in digital networks — foreshadowing ‘the dawn
of the decentralized business model’.13 This is made possible by so-called tokens.
Broadly speaking, tokens are peer-to-peer coded units of value that can not only represent cryptocurrency, but also any other kind of digital assets (that is, any digital representation of tradable commodities, from physical objects such as gold, to computing
power and cloud storage space) — and speciically those assets that back the value
of the tokens themselves. While Bitcoin’s tokens ended the taboo on money’14 by allowing for the irst time the disintermediated generation and transmission of value in
a peer-to-peer network, Ethereum’s tokens enable the transmission of speciic rights
11
12
13
14
On the relation between social and inancial dynamics, as they are mediated through current
networks, see also: Adam Arvidsson, ‘Facebook and Finance: On the Social Logic of the
Derivative’, Theory, Culture & Society 33.6 (1 November 2016): 3–23.
Joel Monégro, ‘Fat Protocols’, Union Square Ventures, 8 August 2016, http://www.usv.com/blog/
fat-protocols. Frank Pasquale has brilliantly illustrated the extent of the personal data market
and data brokerage for advertising, inancial, and surveillance purposes in: Frank Pasquale, The
Black Box Society: The Secret Algorithms That Control Money and Information, Cambridge, MA:
Harvard University Press, 2015; see also: Frank Pasquale, ‘The Dark Market for Personal Data’,
The New York Times, 16 October 2014, http://www.nytimes.com/2014/10/17/opinion/the-darkmarket-for-personal-data.html.
Fred Ehrsam, ‘Blockchain Tokens and the Dawn of the Decentralized Business Model’, The
Coinbase Blog, 1 August 2016, https://blog.coinbase.com/app-coins-and-the-dawn-of-thedecentralized-business-model-8b8c951e734f#.zd6jf0ut9.
Denis Roio, ‘Bitcoin, the End of the Taboo on Money’, 6 April 2013, http://www.dyndy.
net/2013/04/bitcoin-ends-the-taboo-on-money/.
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in peer-to-peer, programmable and automated ways thanks to smart contracts.15 Fundamentally diferent from legal contracts,16 smart contracts are coded protocols (also
called protocol tokens) whose logic and rules of self-execution are enforced through
the underlying blockchain, in a way that is entirely automated and independent from
the established inancial system. By contrast, decentralized applications (dApps) tokens represent assets that exist decoupled from a blockchain. These assets could be
iat currency, gold, internet of things devices, and, as will be made clear, new types of
assets such as art production itself, expressing the potential for appreciation inherent
in such endeavors. Protocol tokens and dApps tokens together are the foundational
tools for the construction of the new decentralized ecosystems on top of blockchain
technology.17 Given the high level of programmability aforded by Ethereum’s smart
contracts, each token’s properties and functionalities can be tuned in accordance to its
intended use (in terms of supply, issuance, inlation rate, economic logic, usage, etc.)
For instance, tokens can be used to access a network, as reward for contributions to
the said network, or as a means for decentralized governance within an organization.
Tokens are often issued to the public either through mining (that is, generated through
computational processes, as in the case of Bitcoin and Ethereum) or by participating
in new types of crowdsales — also called Initial Coin Oferings (ICOs). Similar to the
more mainstream Initial Public Oferings, in which private companies issue their own
stocks to the public market, Initial Coin Oferings are decentralized forms of equity
crowdfunding in which small-sized projects self-issue, or ofer, tokens on the market
as representations of the future utility and value provided by their project in potential,
in order to fund themselves by creating equity relationships with the participants in
the ofering. For these reasons, the ICO funding model has been deined by insiders
as a ‘Kickstarter on steroid’,18 exploding the range of social and inancial possibilities for small communities and individuals, and threatening to disrupt the traditional
funding paradigm in the startup ecosystem. This new possibility is evidenced by
the surge in high-proile Ethereum-based Initial Coin Oferings, recently surpassing
venture capitalists funding, and resulting in the market capitalization of all cryptocurrencies eclipsing $175 billion.19
15
16
17
18
19
This is because Ethereum is a ‘universal machine’, in that it is able to compute any problem that a
single Turing machine can process. In order to do so, Ethereum replaces Bitcoin’s blockchain with
its own infrastructure.
Josh Stark, ‘Making Sense of Blockchain Smart Contracts’, CoinDesk, 4 June 2016, http://www.
coindesk.com/making-sense-smart-contracts/.
Melon, ‘The Diference Between Protocol Tokens and Traditional Asset Tokens’, Medium, 20
April 2017, https://medium.com/melonport-blog/the-diference-between-protocol-tokens-andtraditional-asset-tokens-89e0a9dcf4d1; Albert Wenger, ‘Crypto Tokens and the Coming Age of
Protocol Innovation’, Continuations, 28 July 2016, http://continuations.com/post/148098927445/
crypto-tokens-and-the-coming-age-of-protocol.
Balaji S. Srinivasan, ‘Thoughts on Tokens’, news.21.co, 27 May 2017, https://news.21.co/
thoughts-on-tokens-436109aabcbe.
Josiah Wilmoth, ‘$175 Billion: Record Bitcoin Price Lifts Crypto Market Cap to New Heights’,
CryptoCoinsNews, 1 September 2017, https://www.cryptocoinsnews.com/175-billion-recordbitcoin-price-lifts-crypto-market-cap-new-heights/; Alex Sunnarborg, ‘ICO Investments Pass
VC Funding in Blockchain Market First,’ CoinDesk, 9 June 2017, http://www.coindesk.com/icoinvestments-pass-vc-funding-in-blockchain-market-irst/.
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As crypto-enthusiasts praise the new capabilities introduced by tokens, amidst the
pronounced volatility within the ecosystem,20 several voices from art and cultural theory have opposed the incipient tokenization of everything by means of blockchain,
since it exacerbates the logic of inancialization by assuming it as the very basis of token-based economies. For instance, media artist and technologist Salvatore Iaconesi
rightly observes that technologies such as blockchain and tokens are ‘powerful agents
towards the “transactionalization of life”’,21 and that their uncritical adoption risks dissolving the fabrics of society into the algorithmic mesh that will eventually sustain our
blockchained, inancialized existences. Rather than dismissing altogether the novelty
of blockchain technology and crypto-tokens, however, here I want to propose that
tokenization — as a new, peer-to-peer, socio-inancial practice — opens up important
new avenues for experimentation toward the autonomy of art, and the cultural sphere
at large, from the extractive logic of inancial markets; and, for this reason, it needs to
be reckoned with in concrete ways. In the next section I discuss two artworks, BitchCoin and terra0, that illustrate diferent strategies through which artists today can leverage art’s derivative condition, by cunningly reappropriating and reprogramming the
means of inancialization thanks to blockchain-based tokens. As post-internet became
the aesthetic of the new cultural-inancial coniguration for contemporary art — as
doubly derivative, of both economic and computational valuation processes underlying today’s art informational milieu — these projects gesture toward a post-blockchain
horizon, in which art embraces its inherently economic status and role and, in so doing,
inds novel ways to leverage it through decentralized modes of organization.
BitchCoin and terra0: Tokenization as an Art Form
Among the several art projects that currently engage with blockchain technology, two
stand out for the ways in which they cleverly experiment with the new socio-inancial
afordances that tokens open up for ‘self-inancialization,’ enabling artists to express
and harvest the value of their own work in unprecedented ways. These are Sarah
Meyohas’ BitchCoin (2016) and Paul Seidler, Paul Kolling, and Max Hampshire’s terra0
(2016): the irst highlights the peculiar nature of crypto-tokens, introducing new social,
inancial and aesthetic possibilities; the latter emphasizes the ecological — as in, the
relational or ecosystemic — dimension of token-based economies. In so doing, both
projects exemplify some of the new opportunities that tokens open up for artistic experiments with the medium of inance itself, expressing in a non-reductive way the
economic status of heterogeneous value forms such as art, which has to be accounted
on its own terms.
Loosely based on the model of Bitcoin, BitchCoin is a cryptocurrency backed by the
artist’s photography. Like Bitcoin, BitchCoin relies on a public blockchain. Like Bitcoin,
furthermore, BitchCoin is mined, though in the case of BitchCoin, the tokens have
been pre-mined in the gallery by the artist. Each coin costs $100 and gives access to
25 inches of photographic print by Meyohas, in perpetuity, including all her current and
20 Trent McConaghy, ‘Tokenize the Enterprise’, The BigchainDB Blog, 6 June 2017, https://blog.
bigchaindb.com/tokenize-the-enterprise-23d51bafb536; Fred Ehrsam, ‘Blockchain Tokens and
the Dawn of the Decentralized Business Model’; Albert Wenger, ‘Crypto Tokens and the Coming
Age of Protocol Innovation’.
21 Salvatore Iaconesi, ‘The Financialization of Life’, Startups & Venture Capital, 3 September 2017,
https://startupsventurecapital.com/the-inancialization-of-life-a90fe2cb839f.
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future works. Aptly launched in the context of an exhibition investigating prediction,
BitchCoin is a peculiar kind of token: it serves as an art-backed currency — that is, a
kind of commodity money that is backed by commodifying precisely the process of
art production itself. In this sense, BitchCoin emphasizes the least discussed aspect
of crypto-tokens — neither as a form of electronic cash as Bitcoin has originally been
deined by its inventor(s), nor ‘digital gold’ as the libertarian fringe thinks about them,
but as a form of liquid equity stakes in a common project. Importantly, here I understand equity not in strictly inancial terms, as stocks or shares, but more generally as
an economic relation based on mutual stakeholding, in which both parties share the
risks, but also the upside, of their cooperation.22 In this view, BitchCoin is a token that
gives access to the future value of the artist’s work, while also being freely exchangeable for its current market value.
Emphasizing the role of the artist as producer of cultural value and engaging with the
audience as investors, BitchCoin sets up a new model that enables collectors to invest
directly in the future success of the artist’s career, while also giving Meyohas ‘a stake
in the supply, demand, and price of her own work’.23 In this sense, BitchCoin is also
a speculative device on its own terms, allowing investors and collectors to become
stakeholders in the artist’s career, but also to bet on her future success. From this
standpoint, in contrast with the traditional view of the art object as a store of value,24
BitchCoin gestures toward the programmability that tokens aford, by allowing the artist to account for art as a ‘liquid commodity’ that is constantly generative of value – not
only in the moment in which it is transacted in inancial markets as a inite product but
from the moment in which it is produced. This realization is crucial to an understanding
of the inancialized character of contemporary art. Furthermore, it opens up new possibilities for artists to achieve autonomy from art’s underlying institutional-inancial milieu
by experimenting with the emergent afordances for disintermediated value transmission provided by blockchains.
By assuming art’s place in a socio-cultural milieu rife with economic interests, the project provides an unconventional yet immediately operative approach to the entanglement between art and markets. Acknowledging the inherently inancialized nature of
the art object, manifested in the commoditized (that is, tokenized) form of the art process of production, and airming the role of the artist as cultural producer, BitchCoin
embraces art’s derivative condition and leverages it, by taking control over the means
of inancialization through her own art. This is illustrated by the ritualized launch of
BitchCoin on the market during the opening of her exhibition, which resembles, and
even predates, the already mentioned Initial Coin Oferings. By enabling the artist to
‘self-issue’ her own tokens as indices of her artistic and cultural value, BitchCoin is
about Meyohas inancializing her own art process through the logic inherent in Bitcoin,
and in so doing, creating a new milieu comprised of equity stakeholding in her own
work — an emergent new space of possibilities for the artist and her supporters.
22 For a discussion of equity relations see: Robin Hood Cooperative, ‘Equity, Options, Assemblage:
Robin Hood 2.0’, Future Art Base, 1 May 2015, https://speculativematerialism.iles.wordpress.
com/2015/06/robin-hood-grey-paper-april-2015.pdf.
23 ‘Where 6: “Prediction,” with Sarah Meyohas’, Wherecam Tumblr, http://wherecontainer.tumblr.
com/post/110308568730/where-6-prediction-with-sarah-meyohas-bitch.
24 Velthuis and Coslor, ‘The Financialization of Art’.
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As BitchCoin experiments with the afordances of crypto-tokens for artists’ self-inancialization, terra0 takes this logic one step further and emphasizes the ecological
dimension of token-based economies that, thanks to the new possibilities for incentive alignments and automated coordination introduced by smart contracts, show potential for the bootstrapping of new ecosystems of value. Initiated by Paul Seidler,
Paul Kolling and Max Hampshire, terra0 is an augmented, self-owned forest in which
self-governance is powered through the capacity of the forest to issue its own tokens
based on the Ethereum blockchain. The project starts from an understanding of art as
an ‘autonomously acting, self-suicient economic unit’25 and aims to create an artwork
that is also a fully autonomous ‘piece of capital’.26 In so doing, it explicitly plays with
self-inancialization by enabling a forest to turn, from a passive object of economic
exploitation, to an active agent in the self-utilization of its own resources, for its own
beneit, so that it can eventually buy itself.
terra0 essentially consists of a decentralized application built on top of Ethereum.
Through smart contracts, the application automates the management of the forest’s
resources, enabling it to self-utilize its own value with a combination of sensors, open
data oracles, and AI bots. terra0 illustrates well the paradigmatic shift that blockchainbased token economies have introduced in terms of how networked value is generated
and circulated, enabling for the irst time a programmable inancial engine for decentralized projects. In the economic logic of the system, the forest obtains legal ownership over itself from its initial stakeholders, therefore it is autonomous, yet indebted to
the initiators of the project who purchased the land. In order to buy itself out, terra0
launches an Initial Coin Ofering on Ethereum, ofering tokens that represent the future
returns of the sales of its wood. Leveraging the decentralized stakeholding enabled by
the Ethereum blockchain, in terms of potential for governance and value distribution,
terra0 is a software application that, by accepting Ether to run its contract, directly
supports the development of the infrastructure, which in turn provides reliable services for the lourishing of the application layer, to the beneit of the whole ecosystem.
‘This is where the phenomenon goes beyond just a new way of raising money’ writes
Fred Ehrsam, co-founder of Coinbase, one of the most renowned wallet and exchange
platforms for cryptocurrencies. ‘It is projects creating their own economic ecosystems
to make the entire thing tick’.27 In other words, by adopting a tokenized — that is,
networked, decentralized, and inancialized — approach to its own management and
utilization, terra0 opens up a new funding paradigm for itself, as art, which belongs
neither to the public nor to the private institutional milieu. Instead this emerges through
participation in a common project – that is, through the network of tokenized stakeholding relationships that enable token holders to become invested in the value system
that backs the project’s ofer: the possibility of the realization of an autonomous (that
is, self-owning and self-managing) forest.
25 Paul Seidler, Paul Kolling, and Max Hampshire, ‘terra0’, GitBook, 2016, http://book.terra0.org/;
see also: Leila Ueberschlag, ‘Terra0: The Self-Owning Augmented Forest’, Institute of Network
Cultures, 29 September 2016, http://networkcultures.org/moneylab/2016/09/29/terra0-the-selfowning-augmented-forest/.
26 Ueberschlag, ‘Terra0’.
27 Ehrsam, ‘Blockchain Tokens and the Dawn of the Decentralized Business Model’, emphasis
added.
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Moreover, by exposing the multidimensionality of property rights as legal, economic,
and social operators of subjectivation and power relations, terra0 underscores the
challenges that peer-to-peer automated technologies pose to received notions of ownership, personhood and autonomy in a post-blockchain near future. It does so, not
only in the self-management of capital, but also in the very deinition of agency and autonomy — in both artistic and economic terms — hinting toward a post-human future
in which heterogeneous processes generative of value, such as ecosystemic services,
as well as art, can be tokenized, automatized and cross-bound in very concrete ways.
While the project stops at the case of the forest managing its own resources, in a not
too distant future, inancialization through programmable tokens may allow the forest
to trade itself on the market for natural capital, autonomously entertaining inancial,
social and legal relations with NGOs, governmental institutions, corporations and local communities. The forest may even be able to crowdsource the development and
maintenance of its software to open source communities through bounty ofers set up
by AI bots. Moving forward, the autonomous AI-powered forest could even short on
inancial markets the very corporations encroaching upon it and destroying its integrity
— ultimately collapsing the boundaries between art, ecology, economy, and politics.
*
Both works preigure the possibility for artists to harness inancial logic in order to concretely inlect dynamics in the contemporary art market at large. They do so by revealing and instrumentalizing the multifaceted and decentralized nature of cryptographic
tokens — part commodity money, part currency, part equity, part unit of distributed
governance — in order to create minimal, programmable protocols for interaction in
a peer-to-peer network on the basis of a mutually acknowledged value system. In the
cases discussed above, these value systems are an artist’s career and a forest’s selfmanagement, respectively. Speciically, BitchCoin allows for the disintermediation and
distribution of the process of valuation of Meyohas’ own current and future art production, which is issued directly to her audience in the form of tokens backed by said value
in potential. terra0 takes this logic to an ecosystemic level, by complementing selfissuance with the practice of self-utilization; in this way, the project gestures toward
new ways in which artists can automate and autonomize their art’s value by tokenizing
it — that is, by distributing their potential yield through programmable equity stakes,
enabling the ecosystemic circulation of art in autonomous ways. These two strategies
— self-issuance (the capability for artists to issue their own value) and self-utilization
(the possibility to automate and transparently manage the allocation and circulation
of the value of one’s art) — are crucial to a project of art’s bootstrapping from its underlying techno-inancial substrate, precisely by appropriating and reprogramming the
current logic of inancial derivatives.
Like derivatives, tokens are speculative instruments in that they are abstract protocols
that represent ‘a claim over event worlds that have yet to actualize in space and time’.28
At the same time, in virtue of their abstract nature, derivatives are inherently relational;
they operate, at a very concrete level, by way of a ‘power of potentiation through connection, the power to liquefy and freeze relations, to potentialize and depotentialize
28 Cooper, ‘Turbulent Worlds’, p. 179.
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connections, and thus to shape (and be shaped by) the possibilities of movement of
everyday life’.29 In contrast to the current derivative form, however, blockchain tokens
are efectively able to encode, and account for, singular kinds of value systems without
lattening them onto the only metric that drives contemporary inance: price. Tokens
do so by providing an index to express the value backing each particular kind of initial
ofering to the market, and inscribing it on the distributed ledger of the blockchain —
which is precisely what Meyohas’ BitchCoin does by providing a unit of expression
and distribution for the future value of the artist’s photography. Furthermore, tokens
extend the derivative’s networked, relational and event-making character by making
it peer-to-peer and open source. In so doing, they enable users (artists, startups, autonomists) to program the kinds of social and economic relations informing the emergence of an ecosystem, autonomously from the world of global inance. In this way,
tokens unleash derivatives’ future-building potential and organizational afordances
for the beneit of the inventors of, and participants in, such new socio-inancial forms.
By issuing the artist’s own value in the form of art-backed crypto-tokens, and by setting speciic economic protocols for the forest’s self-management, respectively, both
BitchCoin and terra0 are able to subject audience, collectors, and galleries to each’s
own economic logics, and not vice versa. In this way, both BitchCoin and terra0 seed
a post-blockchain future in which leveraging inancialization, through the issuance of
one’s own value system and encoding of one’s own economic logic for self-utilization,
opens up new horizons for the creation of autonomous milieus.
Toward a Post-Blockchain Art: From Money Making to Making Ofers
BitchCoin and terra0 potentiate the inancialized character of the art object and process — as luid and inherently networked — by disintermediating and reprogramming it
through blockchain technology and the new afordances provided by smart contracts.
Speciically, BitchCoin hints to the multidimensionality of tokens, as they are capable of
expressing heterogeneous forms of value and sharing them as such; terra0 illustrates the
full extent of the new decentralized ecosystem that artists — and any autonomist projects — can build (and participate in) through token-based economies. In so doing, they
provide a glimpse of a post-blockchain future perhaps not too far away, in which tokenization, and the new afordances it provides in terms of self-issuance and self-utilization,
becomes the condition for art’s autonomy through automated smart contracts. As postinternet became the aesthetics of the derivative condition of contemporary art, the postblockchain horizon for art has to assume its inherently economic status but also move
beyond the limitations of the current paradigm. As BitchCoin shows, tokens explode
the traditional money form by enabling it to account for a generative process such as
art. They do so by providing the means to open a temporal horizon that gives unlimited
access to the artist’s own appreciating value, thereby enabling the emergence of new
relational possibilities for her and her stakeholders. terra0 extends this logic by inscribing the practices of self-issuance and self-utilization within a network that enables the
crystallization of an ecosystem around the common project of allowing a forest to own itself. By experimenting with the design and logic of token-based economies, both works
exemplify how artists can use inance as a creative tool, leveraging the new afordances
of blockchain-based tokens, in order to distribute the kinds of social, cultural, aesthetic,
and ecological values that are not accounted for in the current inancial paradigm.
29 Cooper, ‘Turbulent Worlds’.
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As a crucial diference from the post-internet era of art, which limited itself to unveiling
the changing nature of the art object and its luid conditions of production and circulation, both BitchCoin and terra0 open onto a post-blockchain future. It is one that
reckons with the nature of the art object as a commodity that is tokenizable from the
process of production, which can then appreciate in value according to the networked
efort of artists, artworks and audiences in the art informational milieu. In other words,
both projects illustrate that the challenge for artists seeking autonomy from the current
extractive-computational paradigm has to be played at both the ‘derivative’ level (that
of self-issuance and valuation) and at the ‘infrastructural’ level (that of organizational
platform). In so doing, rather than simply exposing the derivative condition of the art
object and process under planetary computation, both projects assume it as a starting point from which to manipulate the deeper fabrics of the art milieu through the
programmability and openness of blockchain technology — using inancialization as
a medium to program, through tokens, new informational milieus and organizational
formations for themselves.
As such, the post-blockchain horizon for art is not just about expressing the art of
money making (by embracing the luidity of the art object as it circulates, like a currency, through networks and markets alike, as post-internet art did). More expansively,
it is about the art of making ofers, as the careful crafting and programming of tokens
— that is, decentralized inancial instruments (liquid equities) for mutual stakeholding
— to be ofered to the public for the creation of peer-to-peer ecosystems of value. As
both BitchCoin and terra0 exemplify through their own Initial Coin Oferings, the art
of crafting ofers corresponds to the capacity of blockchain tokens to set one's own
terms of circulation and protocols for interaction, to design one's own terms of selfutilization through the tools of inance, and to set these tools loose through distributed
units (of liquid equity and governance) that weave new ecosystems of value as they are
transacted and interacted with. This allows for the possibility to issue value in the world
and have it be acknowledged by peers according to programmable rules that enable
the autonomy of that said ecosystem of value. By allowing for the self-issuance and
automated control over the self-utilization of one’s own surplus value, these projects
play with the afordances of inancialization as their own expressive medium and, in so
doing, seed a future in which autonomy may be achieved through the self-harvesting
of one’s own value. Thus, the blockchain revolution and incipient tokenization of everything can open up new possibilities for the arts not only in terms of creating art works
but of generating art worlds — that is, ecosystems that operate according to logics and values produced autonomously by artists and communities themselves. This
means that, if contemporary art cannot be divorced from the socio-cultural logic of derivatives, artists can become active agents of their own inancialization by experimenting with blockchains, rather than passive objects of the inancialization of the art world
that we all know and recognize. This is to say that, as these art projects show, the way
to ight the inancialization of everything is to go through it, rather than try to resist it.
Of course, this proposition is fraught with danger, especially as we bear witness to the
fact that dynamics in these crowdsourcing environments seem to propose once again
old power asymmetries. This may be due, at least partially, to the technical limitations
of current blockchains, in terms of scalability (due to low consensus speed and high
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entrance costs, so that only big investors can enter the space)30 and interoperability
(that is, the problem with the impossibility to have on-chain solutions for large applications, which raises questions about the security of those of-chain transactions). Financializing everything through tokenization could entail extreme risks, such as providing
new surface areas and markets for capital accumulation and producing more virulent
and capillary forms of extraction in the attention economy, thereby reinforcing familiar
dynamics. As it is true that decentralized technologies do not automatically decentralize power,31 the road to the construction of a post-blockchain future, not only for art,
will have to take seriously the vertiginous wager this discussion has proposed — that
is, seizing the means of inancialization through blockchain for autonomous projects —
with all the perils that this may entail. This includes grappling with the limitations of current blockchain ofers and addressing how these may hinder the full-blown realization
of such visionary endeavors. As new promising projects are mushrooming, however, it
remains of the utmost importance for artists to keep exploring the potential of decentralized technologies and leverage them for their own good. As such the post-blockchain frontier of art also entails opening up questions in relation to the ethico-aesthetic
dimension of tokenization and the interoperability of value systems. Blockchain is not
a panacea; only a new weapon to be experimented with and wielded. While we are still
lacking the means for a deep interoperability for our decentralized future, BitchCoin
and terra0 are examples of the possibilities ushered in by cryptographic tokens for experimenting with inancialization in creative and speculative ways, toward the creation
not of mere art works but of many, possible, interoperating, art worlds.32
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IT SEES (NOTES TOWARD A CULTURAL
HISTORY OF FINANCIAL VISION)
EMILY ROSAMOND
In recent years, we have witnessed the emergence of a new phase of capitalism.
Thus argues Shoshana Zubof, who coined the term ‘surveillance capitalism’ to
describe a new regime of accumulation according to which entrepreneurs mobilize
new means of understanding online users, and directly intervene in their habits for
proit. New, ‘born-digital’ irms capitalize on users’ ‘data exhaust’ — information
unintentionally left behind that reveals something of their online habits.1 Early on,
for instance, Google — surveillance capitalism’s most prominent pioneer — reinvented its business model, after realizing that it could proit from the data exhaust
it was already collecting as a byproduct of its activities. By ofering ostensibly free
email services to users, it could analyze users’ data, in order to entice advertisers
with the promise of reaching highly specialized audiences. Users’ online interests
and behaviors — data-sets analyzed into ersatz subjectivities — were efectively
sold to Google’s advertisers, who would bid for prominent spots in online keyword
auctions through Google’s AdWords program. Gmail users could then click on keywords automatically matched to their interests — with the AdWords auction winners’ sites listed most prominently. As Zubof contends, surveillance capitalism’s
‘unexpected and often illegible mechanisms of extraction, commodiication, and
control… efectively exile persons from their own behavior while producing new
markets of behavioral prediction and modiication.’2 Zubof’s theory counters those
who would understand ‘big data’ as a purely technological construct.3 She insists
that data analysis instantiates a power relation, and that it must be understood as
part of a inancial regime.
As surveillance capitalism takes hold (at least for the moment), what can be made
of its aesthetic implications? The surveillance-capitalist regime instantiates new,
impersonal ways of seeing users’ real-time low of interests, and linking inancial
value to these acts of seeing — reconstituting and monetizing subjectivities through
data-sets. Inevitably, these new ways of envisioning and intervening in subjectivity
have shifted the cultural landscapes in which subjectivities take shape. In recent
years, artists have responded to these shifts, agitating the borderlines between
older and newer regimes through which habits come to matter, and through which
subjectivity comes to bear signiicance. For instance, Erica Scourti’s Life in AdWords (2012-2013) (which I have written about more extensively elsewhere4) stages
an extended interaction between two apparatuses through which the artist’s pat1
2
3
4
Shoshana Zubof, ‘Big Other: Surveillance capitalism and the prospects of an information
civilization’, Journal of Information Technology 30 (2015): 79.
Zubof, ‘Big Other’, p. 75.
Ibid.
Emily Rosamond, ‘Technologies of Attribution: Characterizing the Citizen-Consumer in
Surveillance Performance’, International Journal of Performance Arts and Digital Media 11.2
(2015): 148-164.
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terns of interest ind witness and value: the diary and the AdWords algorithm. For
nearly a year, Scourti emailed her diary to herself via her Gmail account, and performed to webcam the list of keywords that turned up in her inbox as a result.
(‘Lyrics lyrics. Feeling tired. Always feeling sad. Feeling depressed. Healthy eating
food. Music and lyrics.’5) Fragments of her interests and behaviours, refracted by
an algorithmic witness into keywords meant to prompt possible sales, paradigmatize the surveillance-capitalist moment. An automated analyst of Scourti’s subjectivity steps in, precisely in the place where she puts it into her own words: in the
seemingly private (but more accurately, privatized) space of the inbox. And yet,
while this piece experiments with the ways in which subjectivity has been newly
commodiied, it by no means assumes that the links between commodiication and
subjectivity are new. Rather, it draws attention to a continual clash of literary and
surveillance-capitalist technologies of selfhood; for the diary itself is also a tool for
producing complex interiority, and if theorists such as Deidre Shauna Lynch are to
be believed, literary constructs of complex, interior life are deeply tied to the expansion of commodity culture through international trade in the 18th century. Here,
embedded in the deeper histories of commodiication, we ind yet another moment
in which (in England, among other places) the capacity to see the world beyond the
horizon — to look into the far distance for patterns of activity and exchange — was
vastly expanded, through a newly international inlux of objects. In Lynch’s view,
the subjective correlates to these conditions were new sets of crises and questions
around what constituted private life — and how to render it truly private. The development of complex literary characters — exemplars of interior life — helped to reconcile the newly internationalized lows of commodities with conceptions of private
life.6 Scourti’s work emblematizes the surveillance-capitalist moment — precisely
by pointing to the deeper history of the continually-mutating ield of inancially-inlected ways of knowing the self. Her work shows how surveillance-capitalist ways
of understanding (and, thus, reshaping) subjectivity come into strange, conlicted
alignment with older technologies through which subjectivity was pulled into line
with commodiication.
Here, I would like to continue what I see as the historical project in Scourti’s work,
and look a bit further into the deep aesthetic histories of this new regime of inancial
surveillance. Rather than staying with the twenty-irst century moment that Zubof focuses on, I would like to begin by looking for the unexpected cultural prehistories of
surveillance capitalism. How have artworks and narratives, long before the age of big
data, questioned how inancial interests themselves ‘see’ the world? Below are a few
irst steps toward what could be a much larger project: what I might term a cultural
history of inancial vision. To begin to get a sense of how inancial vision might have
shifted over the centuries, I’ll isolate works from a few quite disparate cultural moments: Thomas Bridges’ The Adventures of a Bank-Note (1770-1771), Mark’s Narrative
Structures (late 1990s) and Amir Chasson’s painted diptychs of abject, slightly disproportionate businessmen, paired with abstract graphs and diagrams (2009-2010).
These works, I argue, might be understood as part of a history of impersonal, inancial
5
6
Erica Scourti, ‘Life in AdWords: March 2012’, https://vimeo.com/album/1944360/video/39677781.
See Deidre Shauna Lynch, The Economy of Character: Novels, Market Culture and the Business of
Inner Meaning, Chicago, IL: University of Chicago Press, 1998.
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vision. They are galvanized by the complex perceptual and conceptual tasks that accrue around a simple aesthetic/narratological conceit: ‘it sees’. If carefully analyzed
with an eye toward how they construct a inancial ‘it’ that ‘sees’, these works might
have the capacity to shift something in the way that we contextualize the new relations
between acts of seeing and acts of valuation taking shape in our own time.
Fig. 1. Erica Scourti, Life in Adwords (screenshot view), 2012-2013.7
What follows comes from a strong sense of the importance of Zubof’s theory, and
of the urgent need to expand on its aesthetic and cultural implications. Yet it also
necessitates a departure from Zubof’s theorization and aims. For Zubof, surveillance capitalism represents a fundamental departure from how the neoliberal-era
market was envisioned (by Hayek, for instance) as something ‘intrinsically inefable
7.
Image reprinted with permission from the artist.
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and unknowable’.8 For her, the ‘informating’ of the economy in the twentieth century
— rendering it information-rich through smart machines — makes for a fundamental
shift: for technologies of automation (say, scanner devices to automate supermarket
checkouts) also produce data that can be used to change the very systems in which
they function. Smart automation tools carry the capacity to ‘create a vast overview of
an organization’s operations,’ which can then feed back into the system, changing the
ways in which its various activities are coordinated and conceived as a whole.9 While
in many ways, surveillance capitalism is indeed a fundamental shift, here I would like
to consider an alternative to the above claim. Instead of assuming that the informating
of the economy is entirely new, what if we imagine that at every turn in their development — from the irst bank-notes to the irst derivatives — ever-more abstract inancial
products were newly informatic, in that their circulation and use produced new ways
of impersonally seeing the world, and creating views of systems as a whole? In the
history of which I’d like to put forward a few, tentative fragments, surveillance capitalism is part of a much older trajectory: of imagining how inance ‘sees.’ Below are a
few fragments of a legacy of narrative and visual techniques which experiment with
inance’s claim on impersonal vision.
Fig. 2. Mark Lombardi, George W. Bush, Harken Energy, and Jackson Stephens, ca. 197990 (5th Version), 1999.10
The Adventures of a Bank-Note
If we were to search for an early precursor to surveillance-capitalism, no better candidate could be found than Thomas Bridges’ serial novel The Adventures of a BankNote. Bridges published the Adventures in two volumes in 1770, with a subsequent
two volumes published in 1771.11 In this series, a bank-note, narrated in the irst person,
tells of its travels as it is passed from pocket to pocket. Bridges’ tale was one of the
8
9
Zubof, ‘Big Other’, p. 78.
Shoshana Zubof, In the Age of the Smart Machine: The Future of Work and Power, New York, NY:
Basic Books, 1988, p. 9.
10. This reprint is for educational use only. No copyright infringement intended.
11 Around this time in England, there were several popular stories which featured coins and banknotes occupying the irst person, including Helenus Scott’s The Adventures of a Rupee, Wherein
are Interspersed Various Anecdotes Asiatic and European (1772) and Charles Johnstone’s Chrysal,
or, The Adventures of a Guinea (published in 1760 with two subsequent volumes in 1765). There
are also a number of more recent examples of narratives that follow a single bank-note or coin
as it weaves between people, places and situations. These include Bresson’s last ilm L’Argent
(1983), which loosely adapts the irst part of Tolstoy’s novella The Forged Coupon (irst published
in 1910), and Marguerite Yourcenar’s novel A Coin in Nine Hands (1934).
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18th-century it-narratives: novels which featured irst-person objects as protagonists.
This work enacts both a desire to witness money’s social life, and a fascination with the
relationships between the circulation of money and the narrative form itself conceptualized as a kind of circulation. The Adventures of a Bank-Note and other stories like
it from the mid-18th century explore narrative possibilities that, arguably, have been
less accessible to writers since: both the depiction of money in the irst person, and
what could be seen from a contemporary perspective, at least, as a radical lattening
out of human characters as they are seen from the perspective of money. As Deidre
Shauna Lynch notes, the ability to think of bank-notes as having their own histories of
circulation was readily available to mid-18th century minds due to the physical form
of bank-notes at the time. Prior to 1797, when the Restriction Bill caused Britain to
adopt a uniform, anonymous paper currency, bills of exchange would be produced by
particular banks, and would require bearers to countersign them over to a third party,
who would then be required to countersign them to another party, and so on.12 Thus,
the form of the bills themselves bore witness to their previous activities through the list
of endorsements they accrued. Yet these narratives were also useful tools for ‘readers
and writers who found themselves dwelling in a new commercial world, one altered by
new trade routes and new forms of credit and full of strange commodities that invited
the gaze and emptied the pocketbook.’13 Money, Lynch notes, both acts as a vehicle
for the narrative form, and stands in for a social agreement on a standard of value in
this newly commoditized world.14 The irst-person bank-note humanizes the economic
system, even as it subordinates individual human actors to an impersonal circulation.
Bridges’ tale gives a light-hearted account of a series of interactions between a banknote and its owners, the tales they overhear, and the objects they encounter. In Volume
IV, for instance, the bank-note describes its time with a Mr. Derbyshire, whose heart
‘was as light as a feather’.15 As Mr. Derbyshire and a friend sit on a bench one evening,
they observe a fashionable, comely woman walking with an exceedingly strangely
dressed man; Mr. Derbyshire’s friend recounts the tale of how these oddly-matched
igures came to meet. The man, being captain of a large ship that trades slaves on the
African coast, had come to land on a rare occasion to pay a visit to his cousin, who
had recently married the fashionable woman. Trying to look respectable, but unfamiliar
with land customs, the sea captain had employed a tailor, a hatter, and a French barber
to suit him up; the latter concealed his black locks with a strange white wig that he
claimed was the height of fashion. When the captain called upon his cousins, he was
taken into the parlour to wait. There, amidst all the unfamiliar objects of domestic life,
he encountered a large mirror, which surprised him greatly, as he had not seen his own
relection before, and did not recognize himself in the new clothes and wig. Walking up
to the mirror to see who was this strange person staring at him, he bashed into it and
broke the glass, the surprise of which sent him barrelling backwards into an armchair,
lattening a guitar. This caused him to upset the dessert glasses, sending them to the
loor. On encountering this scene, the lady of the house admonished the servants for
letting a madman into the house; inally, her husband arrived and explained that this
12
13
14
15
Deidre Shauna Lynch, The Economy of Character, p. 97.
Ibid., p. 24.
Ibid., p. 96.
Thomas Bridges, The Adventures of a Bank-Note, Vol. IV, London: T. Davies, 1771 (reprinted by
Nabu Public Domain Reprints), p. 2.
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was, indeed, his seafaring cousin. Being a discerning woman, she saw the captain’s
honesty, sincerity and artlessness, and ever since relished her visits with him. Here,
the narrative form depicts a clash of commodities, customs and people brought together by exchange, and layered within three perceptual purviews (the friend’s, Mr.
Derbyshire’s, and the bank-note’s). These nested layers of recounted tales place certain actors, be they objects or humans, very ‘close up’ (even too close, as in the mirror
and the guitar), and certain others (such as the slave ship) in the extreme distance.
The bank-note’s impersonal vision picks out extreme foregrounds and backgrounds in
these overheard tales.
How might we further understand the relations, in this tale, between money’s way of
observing the world and the narrative form itself as a kind of circulation? Alex Woloch’s
narrative theory might help. Writing on 19th-century realist novels, Woloch describes
narrative spaces as competitions between many characters for limited narrative attention and import.16 Minor characters, he contends, relexively draw attention to the limits
of the narrative’s attention, and function as the proletariat of the novel. If we transpose
this thinking into the narrative spheres of The Adventures of a Bank-Note, we could
conclude that all the characters (other than the bank-note itself) are minor, in a certain
sense: none of them hold the plot’s attention for long. Together, they represent society
as a multitude of particularities strung together by exchange, and economic exchange,
in itself, as a chaos of encounter — always involving misunderstandings of objects and
appearances. The shape of the narrative space is determined by the interplay between
the bank-note’s passivity and activity. It cannot determine into whose hands it falls;
and often, it repeats the conceit that it would have liked to tell us more about a particular story, except that it was whisked away too soon. It passively perchances upon the
narrative thread it recounts, moved by the collective agency of circulation. However,
within this conceit of passivity, the bank-note clearly chooses which stories to focus
on, and develops dispositions toward the characters it portrays. Thus, it produces an
interplay between monetary exchange and moral ainity.
This interplay rests on the bank-note’s ‘perception’ and discernment of its owners’
characters. Layers of perception and discernment link the perceptions of the banknote with those of other characters, which are often nested within each other; for
instance, the bank-note observes Mr. Derbyshire’s conversation with his friend, in
which is encased the observations of the sea captain and his land-dwelling cousins.
The nested perceptual frameworks create a division of degrees of narrative containment between those who characterize and caricature others, and those who are caricatured. Roughly speaking, this diferentiation between the characters who perceive,
while having few features themselves (the bank-note, irst and foremost, and secondarily, Mr. Derbyshire), and the characters who are merely perceived or caricatured
within the novel’s narrative spaces expresses their relative proximity to the bank-note
– both perceptually and morally. The characters who make a purchase, thus acquiring
the note, also have a purchase on the narrative’s inlections, and are able to make a
claim on its neutrality. However, this narrative proximity between the note’s and its
possessors’ perspectives is not equally shared between owners; the bank-note takes
16
Alex Woloch, The One Vs. the Many: Minor Characters and the Space of the Novel, Princeton, NJ:
Princeton University Press, 2003.
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a much more distanced stance toward its owner John the Ratcatcher than it does
to Mr. Derbyshire (whom it ‘likes’ better), for instance. (John is a character alicted
with an un-Christian anger toward rats.) In addition to proximity to money diferentiating between the novel’s observers and observed, a moral and dispositional ainity
between the bank-note and some of its owners — i.e. the bank-note’s perception
of certain of them as good — creates a closer ainity of perspective. Thus, while
the novel portrays economic exchange as a comedic clash of characterizations and
encounters between disparate worldviews, it also portrays the economy as a relation
between the bank-note’s circulation and an economy of representation based on an
ainity with the good.
Within this comic clash of ainities, we ind a theory of inance as focalization. The
bank-note focalizes the story, outlines the range of its perceptual purview and moral
ainities. The narrative space expresses new ways of understanding a whole system
of exchange: from the extreme foregrounds of a bank-note’s companions, to the extreme backgrounds of slave ships — which are taken for granted, here, as part of the
background conditions through which commodity exchange takes place, and scantly
brought to attention by the sea captain’s travels, of which the bank-note overhears.
Contrary to Zubof’s claim that informated ecomomies are new in their production
of systemic information through data, if we look through the ‘eyes’ of money in The
Adventures of a Bank-Note, we ind a narrative expression of what was then a radically new way of understanding the world and its commodities, envisioned from the
very perspective of monetary exchange. The Adventures are part of the long cultural
prehistory of surveillance capitalism; they embody the conceit that money is a focalizer, that it produces new conigurations of knowing, that it sees. Thus, although
there are, of course, many novel informatic, economic and technological developments in the ield of inancial vision within our own surveillance-capitalist moment,
the diference between these and the kinds of new systemic knowledge accruing
around the early bank-notes is a diference of degree, and not one of kind. Further,
within this diagram of inancial vision emerges a set of questions around inance
and focalization relating to power. Who gets to claim ainity to money’s impersonal
gaze? With whose interests and perspectives is inancial vision aligned — and who
gets cast into the background?
Mark Lombardi’s Narrative Structures
Now, let us try to think about how these questions, accruing around the narratives of
inancial vision, have been reshaped much closer to the present. In the past several
decades, of course, the task of narrating international inance has become far more
complex than it was in Bridges’ time. There has been a fundamental economic shift,
away from the logic of exchange and toward logics of investment and credit. The development of derivatives – inancial products that bundle many investments to hedge
risk — are dizzyingly complex. As the Bank of England’s then Director of Financial
Stability, Andrew Haldane, quipped in 2009, the emergence of inancial innovations
such as structured credit (designed to diversify investment and thereby minimize
risk) result in a situation in which end investors are ‘no more likely to know the name
of the companies in their portfolios than the name of the cow or pig in their exotic
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hot dog.’17 Certain forms of structured credit, such as collateralized debt obligations
(CDOs), would require over one billion pages of research in order for an investor to
understand precisely where his or her money had been invested.18
Due to the complexity of international exchange, new forms of diiculty accrue
around the questions: who can claim to narrate global inance? How can global
inance be seen — and how does it see? Mark Lombardi’s drawings of global inancial networks attempt to intervene in these questions. If Bridges’ Bank-Note narrative constructs a irst-person, embedded economic viewpoint, focalizing economy
in the exchanged note’s range of abstract perceptions, Mark Lombardi’s drawings
do the exact opposite. They construct an omniscient perspective on an overwhelming range of inancial transactions, contacts and inluences. His diagrammatic
drawings (which he referred to as Narrative Structures) document complex inancial
scandals, international money laundering schemes and other nefarious machinations of power. They were based on extensive research into events such as the Harken Energy scandal (which involved alleged insider trading by George W. Bush after
his failing oil company was purchased by Harken, largely in order that it could make
Bush a board member and take advantage of his extensive political connections)
and the Savings and Loan scandal (in which several troubled American Savings
and Loan institutions — many with high proile board members and close connections with the CIA — turned themselves into Ponzi schemes during the 1980s and
1990s in the wake of deregulation). Lombardi used a legend consistent across his
mature work to indicate lows of money, inluence and power between individuals
and corporations. His drawings trace rhizomatic, difused networks.19 If the inancial transactions chronicled by Bridges’ bank-note represent an attempt to envision
society as a whole, then Lombardi’s drawings translate a similar concern into an era
in which it is not a quotidian clash of (inancially-inlected) encounters that might
seem remarkable to readers and writers newly experiencing an unprecedented level
of imported goods, but rather the emergence of complex transnational systems of
structured credit, and with these, a global elite of key players from a web of seemingly ‘open’, networked transactional structures. In their very difuseness, these
structures both conceal this elite, and help to replicate its privilege. These drawings
are attempts to make sense of the simultaneous dispersion and concentration of
power within globalized neoliberal capitalism, by producing a new way to see the
complex networks of global inance.
Andrew Haldane, ‘Speech: Rethinking the Financial Network’, Bank of England, 28 April 2009,
http://www.bankofengland.co.uk/archive/Documents/historicpubs/speeches/2009/speech386.pdf,
p. 16.
18 Ibid., p. 17.
19 These works closely relate to Hans Haacke’s earlier systems theory/institutional critique works
(most famously Shapolsky et. al Manhattan Real Estate Holdings, a Real-Time Social System, as
of May 1, 1971, 1971), which were a major inluence on Lombardi; however, here, the complexity
Haacke envisions is taken almost unfathomably farther. As Herbert Ross puts it, these drawings
‘update history painting in terms of theories of globalism and rhizomatic schematizations of power.
In these works, [Lombardi] replaces the taproot theory crucial to history painting — that great
individuals are the initiators of important events — with a new model based on less centralized,
more serendipitous channels of power’ (Ross, in Robert Hobbs (ed.), Mark Lombardi: Global
Networks, New York, NY: Independent Curators International, 2003, p. 13).
17
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This is a concern that Lombardi’s drawings explore through their experimentation with
the narrative form itself.20 They can be considered to be both realistic and abstract:
realistic in their use of names as static poles within the narrative, and abstract in that
the actions and events themselves are lacunae within the drawings, mostly replaced
by mere lines and arrows. Hobbs notes that the abstraction of events in these drawings account for many viewers’ frustration in trying to ‘read’ them, as they have been
given, as it were, an architecture of events but little explanation of them.21 Yet by abstracting narrative in this way, Lombardi produces the meta-event — a structure of
power and inluence — which is represented, here, as a character structure of sorts;
an associative play of recognizable individuals and institutions. By reducing events to
lines, he can also tackle multiple ‘plots’ within the same narrative structure. Lombardi’s
Narrative Structures grapple with inancial liquidity’s challenge to narrative structure,
which must be presented as a hybrid between literary and pictorial modes of experience. The arrows and lines in Lombardi’s drawings, which describe lows of exchange
and inluence, are roughly analogous to the narrative itself in Bridges’ Bank-Note. Yet,
responding to the demands of a highly complex international inancial world, Lombardi
produces a meta-transactional narrative. His Narrative Structures imagine a new kind
of impersonal gaze on inance — one that can make a synthetic claim on the totality of
complex transactional webs, and thus, perhaps, provide a perceptual ground on which
an activist stance can be founded. By ‘zooming out’ in the extreme, and synthesizing
transactions and inluences into diagrams of power, Lombardi constructs an impersonal other who takes in the entirety of a hidden inancial low. From this position —
and with this act of witnessing — comes the possibility to act against the centralization
of inancial power, hidden by so many gossamer strands of inluence and exchange.
Amir Chasson and Fractured Financial Vision
This cumulative impulse — this urge to totalize elements of the inancial sphere —
represents one way in which the impersonal claim to inancial vision has been mobilized within late capitalism (in Lombardi’s case, before the surveillance-capitalist turn
as such). Yet another possible approach is quite opposed to this totalizing aim: one
which posits a fracturing of inancial vision, and isolates a point of contact at which
the exigencies of human perception and the ways in which inancial apparatuses ‘see’
each undo the grounds on which the other stands. In Berlin-based Israeli artist Amir
Chasson’s paintings, we ind another form of analysis of the role of individuals within
the narratives of business and inance. His series of painted diptychs from 2009-2011
feature quasi-realistic portraits of slightly awkward looking men: presumably businessmen, most often against a plain background, as if posing at a portrait studio. Next to
the portraits are textured, layered canvases portraying abstract diagrams and charts,
which look as though they might convey inancial or sociological information — except
that there is no contextualizing information or legend with which to understand them.
These works operate by means of stark contrasts: between portrait and diagram; between the rough, painterly texture of the diagram canvases and their ‘cool’, preciselyrendered objects; and, more minutely, between the photorealistic conceit the portraits
entertain and their deliberately awkward handling upon close examination.
20 As Hobbs writes, ‘We might hypothesize that Lombardi’s narratives correlate well with the
enlarged scope of narrative studies and in fact expand them in a new direction, since his drawn
arcs replace the core element of stories, i.e. their action’ (Hobbs, Mark Lombardi, p. 47).
21 Ibid., p. 47.
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Fig. 3. Amir Chasson, Ten dimensional tetrahedron, oil and household paint on canvas,
2011.22
Awash with contrast, the eye seeks similarity. Darting back and forth between the
pairs of canvases, it formulates transitions (formal, narrative, conceptual) between
face and diagram. An arrow jutting out of a tetrahedron seems to answer to something of the upward tilt of a middle-aged man’s jaw; a topographical diagram, describing spiky irregularities emerging from a relatively lat surface, stands in for
an idea of the portrait as a spatial descriptor, a device that morphs a lat surface,
transforms a spatial plane into a facial plane by pulling out nose, cheek and brow.
The diagrams’ spatial cues pull on the portraits, as if applying a bit of makeup to
the latter’s spatial gestures.
The faces infuse the diagrams with possible narratives. Are these the faces of the
thinkers ‘behind’ the sociological, mathematical or inancial work presented in the
diagrams? Are they the repressed of the diagrammatic image — the abject, psychologised individuals who bear the privileges and burdens of such impersonal
exactitudes of information? The portraits in Chasson’s paintings carry out the aspirational tendencies that the form of the businessman’s portrait implies, which is
based, in part, on the projection of conidence (which, as Sianne Ngai puts it, is
the afective tonality of capital itself23). But conidence — or perhaps we could say
orbits of conidence, belonging to both face and diagram’s forms of assertiveness
— break down, here, as they play out on faces and surfaces overfull with ambivalence and distortion. Over-fullness — as it pulls apart faces or dances in diagrams
awkwardly forced onto pockmarked surfaces — disallows the unanimity of feeling
22. Image reprinted with permission from the artist.
23 Sianne Ngai, Ugly Feelings, Cambridge, MA: Harvard University Press, 2005, p. 62. As Ngai points
out, Melville’s story demonstrates that conidence can circulate within scenarios of capitalist
exchange as a feeling that nobody actually feels – as one agent falsely projects it to the next, and
so on.
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that the conident demeanour must display. These faces, so full, come in and out of
comprehensibility; at times, they come into focus as a face, and at other times, the
strange autonomy of features pulls them beyond recognition.
What happens to perception in Chasson’s portraits seems oddly akin to the perceptual
operations Oliver Sacks chronicles in his narratives about encounters with patients
sufering from rare neurological disorders. For instance, Sacks describes a patient
who, owing to a tumour or pronounced degenerative process localized to the visual
cortex of his brain, could see well, but was often completely unable to make the cognitive leap from seeing to recognition. He could distinguish features but could not get a
sense of a face as a whole, a persona or a picture.24 Sacks’ narratives pull apart socalled ‘normal’ perception, reveal something of the layers of complex relational and
cognitive procedures that must be in place in order for people to be able to take for
granted how they know about what they see.25 In undoing normal perception, these
narratives create fertile soil for thought experiments: what might it mean to subtract the
persona from the person, to perceive the world abstractly?
Do Chasson’s abstracted diagrams have a physiognomy? The portrait — a device that,
in the slow obstinacy of its features’ relations to the whole face, dismantles normal,
transparent perception — inlicts its abstraction on the diagram. It asks us to recognize
the tasks of understanding inance and other forms of informational power as physiognomic in ways in which we are not necessarily equipped to perceive. It asks anew what
kind of perception might naturalize the physiognomy of inance, might pull its ‘face’
into focus. In an era of information oversaturation, as Frederic Jameson describes
it, the task of understanding globalized inance is one of unprecedented magnitude:
‘to think a system so vast that it cannot be encompassed by the natural and historically developed categories of perception with which human beings normally orient
themselves.’26 In response to this complexity, Chasson’s works suggest that the task
of synthesizing complex information into some form of understanding can be likened
to the perceptual leap from information to its physiognomy. What might be required,
these paintings seem to suggest, is to construct partial objects of study that denaturalize perception, and in so doing, might themselves produce means for constructing,
dismantling and reconstructing physiognomies of inance, which ferry inance to the
edges of the knowable. Unlike Lombardi, who responds to the complexities of international inance by constructing a totalizing perspective — an omniscient ‘it’ who ‘sees’
— Chasson fractures inancial vision – inserting it into the act of looking at his diptychs
24 For instance, when handed a glove and asked what it might be, the musician describes it as a
‘continuous surface… infolded on itself’, that might be a container of some sort. When asked what,
precisely, this infolded surface might contain, Dr. P. exclaims, ‘it would contain its contents!’ with
a laugh — and then speculates that perhaps it could function as a coin purse for coins of ive
diferent sizes. As Sacks remarks, he ‘construed the world as a computer construes it, by means
of key features and schematic relationships.’ Oliver Sacks, The Man Who Mistook his Wife for a
Hat and Other Clinical Tales, New York, NY: Harper Perennial Library, 1990, p. 8.
25 Though his work, of course, points to the importance of neural activity, Sacks never ascribes
a purely neurological causality to his patient’s experiences; on the contrary, he insists on
house visits, pays close attention to the ways in which his patients navigate their worlds, their
relationships, their objects.
26 Frederic Jameson, The Geopolitical Aesthetic: Cinema and Space in the World System,
Indianapolis, IN: Indiana University Press, 1995, p. 2.
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in such a way that it undoes what is taken for granted in human perception. Thus, he
invites us to question how inancial vision goes beyond what some might tend to assume are naturalized human physiognomic capacities, and to think anew about what it
might mean to grapple with the diiculty in imagining how, exactly, inance sees.
Conclusion
In surveillance capitalism, we become, I think, more and more familiar with being subject to newly automated, impersonal, inancial forms of vision. In this regime, the surveillant gaze is deeply impersonal, even as it exacts its vision on individual users’ most
intimate habits, tendencies and interests. As Erica Scourti’s Life in AdWords (which
shares some similarities with Chasson’s approach above) posits, in order to understand how subjectivity is currently being reconigured in relation to these evaluating
apparatuses, there is a new sort of perceptual task coming to the fore: that of imagining the points of contact between various types of perception that have already come
to be understood as part of the ‘personal,’ and the ever-evolving inancial systems
which exercise their own forms of impersonal vision on personal lives. This task, I
argue, demands a theory of the deep histories of inancial vision. Such a theory must
continually keep in mind the recalcitrant impersonality of vision — the autonomy of the
inancial ‘it’ who ‘sees.’ Yet it must also keep in mind that narrative claims to be aligned
with inance’s autonomous ways of seeing are, in themselves, succinct expressions
of power. Who claims proximity to, or ainity with, the impersonal gaze of inance?
In order to understand how new forms of inancial power operate aesthetically, such
questions must be kept in mind.
The Adventures of a Bank-Note, Lombardi’s Narrative Structures, and Chasson’s diptychs represent three possible approaches to these questions surrounding inancial
vision: an embedded, irst-person view of money, personiied; narrative structures enveloping global inance in an omniscient perspective; and a calling into question of the
perceptual schisms between feature and physiognomy, and between two seemingly
distinct kinds of complex information: face and diagram. In Bridges’ narratives, the
economy possesses perception; in Lombardi’s, the economy is rendered perceptible.
Chasson’s paintings point to the inadequacies of human perception when it comes to
understanding inancial vision. By constructing inancial imaginaries that draw attention, in various ways, to the impersonality of inancial vision, these works challenge
many of the ways in which art has previously been understood to relate to political
economy: either, reductively, as a mere ‘relection’ or ‘expression’ of monetary interests; as expressive of a reiied set of signiiers and practices demarcating class positions through taste and conspicuous consumption; or, more broadly, as expressive of
a ‘pan-capitalist’ alienation. With surveillance capitalism comes the need to study in
far more detail the impersonal, inancial ‘it’ that ‘sees.’ Paying attention to the complex narrative and visual constructs according to which inancial vision has been understood draws much-needed attention to how regimes of accumulation themselves
identify their subjects.
In 2014, Trevor Paglen remarked that there is an urgent need for cultural practitioners
to rethink how we understand vision — and to consider what might be at stake in trying
to imagine how machines see:
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those of us who are interested in visual literacy will need to spend some time
learning and thinking about how machines see images through unhuman eyes,
and train ourselves to see like them. To do this, we will probably have to leave our
human eyes behind.27
As Zubof might add, we must also think carefully about how new regimes of accumulation accrue around these acts of mechanical seeing — or, as I might put it, to shift
the paradigm from mechanical to inancial vision. And further, we must remember that
impersonal, inancial vision is neither purely mechanical, nor purely inancial. By beginning to assemble some fragments toward a cultural history of inancial vision, I hope to
draw attention to the complexities of visual, subjective and narrative conceits that will
inevitably be intertwined in any attempt to understand how ‘it sees.’
References
Bridges, Thomas. The Adventures of a Bank-Note: Vol. IV, London: T. Davies, 1771 (reprinted by Nabu
Public Domain Reprints).
Haldane, Andrew. ‘Speech: Rethinking the Financial Network’, Bank of England, 28 April 2009, http://
www.bankofengland.co.uk/archive/Documents/historicpubs/speeches/2009/speech386.pdf.
Hobbs, Robert (ed.). Mark Lombardi: Global Networks, New York, NY: Independent Curators International, 2003.
Jameson, Frederic. The Geopolitical Aesthetic: Cinema and Space in the World System, Indianapolis,
IN: Indiana University Press, 1995.
Lynch, Deidre Shauna. The Economy of Character: Novels, Market Culture and the Business of Inner
Meaning, Chicago, IL: University of Chicago Press, 1998.
Ngai, Sianne. Ugly Feelings, Cambridge, MA: Harvard University Press, 2005.
Paglen, Trevor. In Jorg Heiser (ed.), ‘Safety in Numbers?’, Frieze, 12 March, 2014, https://frieze.com/
article/safety-numbers.
Rosamond, Emily. ‘Technologies of Attribution: Characterizing the Citizen-Consumer in Surveillance
Performance’, International Journal of Performance Arts and Digital Media 11.2 (2015), 148-164.
Sacks, Oliver. The Man Who Mistook his Wife for a Hat and Other Clinical Tales, New York: Harper
Perennial Library, 1990.
Scourti, Erica. ‘Life in AdWords: March 2012’, https://vimeo.com/album/1944360/video/39677781.
Woloch, Alex. The One Vs. the Many: Minor Characters and the Space of the Novel, Princeton, NJ:
Princeton University Press, 2003.
Zubof, Shoshana. In the Age of the Smart Machine: The Future of Work and Power, New York, NY:
Basic Books, 1988.
_____. ‘Big Other: Surveillance capitalism and the prospects of an information civilization’, Journal of
Information Technology 30 (2015).
27 Trevor Paglen, in Jorg Heiser (ed.), ‘Safety in Numbers?’, Frieze, 12 March, 2014, https://frieze.
com/article/safety-numbers.
PERFORMING FUTURE FINANCE
THE RECEPTION OF
THE FINANCIAL CRISIS
IN HOLLYWOOD
MOVIES
DAVID HOLLANDERS
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THE RECEPTION OF THE FINANCIAL CRISIS
IN HOLLYWOOD MOVIES
DAVID HOLLANDERS
Introduction
The Great Financial Crisis (GFC) has resulted in several Hollywood blockbuster movies
about the inancial sector. There are at least four big-budget post-2008 movies on the
GFC. If IMDB is any guide, the best is The Wolf of Wall Street1 (rating: 8.2), followed
by The Big short2 (7.8), Margin Call3 (7.1) and Wall Street: Money Never Sleeps4 (6.2).
If the criterion is whether the movie has something interesting to say about the GFC,
the order should actually be the exact opposite. Entertainment is not the same as
analysis, nor should it be a substitute. Indeed, all four movies are testimony to an intrinsic limitation that all (big-budget) movies face. Hollywood movies are generally plotdriven, event-rich, and suspenseful, featuring protagonists with whom audiences can
easily identify. When these movies dramatize a slowly and unevenly unfolding politicaleconomic conjuncture, consisting of events like the 2008-Lehman Brothers collapse,
they usually cannot readily be reduced to such events.
Be that as it may, three out of four of the movies do have something interesting to tell
about the biggest crack so far in the post-Bretton Woods order. The GFC is embedded in the outcome of the unravelling of the Keynesian Bretton Woods compromise,
and has as such been a long time in the making. In 1971-73 Nixon reneged on the
1944 Bretton Woods promise to peg the dollar to gold (and Western-European currencies to the dollar). The (inancially) costly Vietnam war had turned the USA from a
creditor-nation into a debtor-country. From then on, the USA had to borrow from the
rest of the world. The solution was the inancialization that unfolded from the seventies onwards. Wall Street ensured that foreign capital was invested in the USA, while
skimming a nice percentage in the process. Countries that didn’t play ball could always
be occupied, but oftentimes the International Monetary Fund (IMF) could convince
countries to privatize their public sectors, to behave investor-friendly and to invest
their savings on Wall Street. Of course, the incoming money didn’t reach the American majority: American wages have stagnated over the last three decades. The turn
towards inancial services and the simultaneous move away from production (which
was outsourced to low-wage zones in Mexico and China) mainly enriched Wall Street.
The only solution, albeit temporarily, for ordinary Americans was to borrow. Contrary to
wages, consumption in the USA didn’t stagnate, because of a private-debt bonanza in
which Wall Street banks lent money to people to inance houses, college degrees and
cars they had needed but ultimately couldn’t aford.
1
2
3
4
The Wolf of Wall Street (dir. Martin Scorsese, 2013).
The Big Short (dir. Adam McKay, 2015).
Margin Call (dir. J.C. Chandor, 2011).
Wall Street: Money Never Sleeps (dir. Oliver Stone, 2010).
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This post-1973 inancialization is a theme in three of the movies. An added advantage
is that they inform a wider public about the greatest robbery in recent history. First
and foremost, the GFC is a heist in which banks privatized the state, the state aided
and abetted banks and citizens had to pick up the tab. This cannot be made clear
often enough. All the same, the movies fall short of analysing why that came about
and how that is interwoven with the current political moment. What they don’t show
is therefore as relevant as what they do. But let’s irst take a closer look at the four
movies and their merits.
The Wolf of Wall Street (The WoWS)
The Wolf of Wall Street (2013) has the highest IMDB-rating. It is indeed the most
straightforward of the four, depicting a small swindler (played by Leonardo DiCaprio),
who hustles his way to a small fortune. He aggressively sells penny-stocks with a
combination of intimidation, seduction and outright fraud. Besides being a fraud, the
protagonist is decadent to the bone. He is a coke-sniing, sexist, selish man, and
the audience is invited to see his point of view. The identiication with the Leonardo
DiCaprio character does not last the entire length of the ilm, as towards the end of the
movie the main character derails and discredits himself completely, so viewers — most
of them at least — will stop short of fully identifying with him.
Be that as it may, you don’t need to be a Freudian to propose that the main character
acts out pretty much all the secret wishes of the WASP. He is a white, heterosexual
man who indulges in every cardinal sin — sex, drugs, lying, cheating, dominating —
and who does so with the charm that indeed sometimes comes with unchallenged
privilege. In the end, Leonardo DiCaprio’s character does not get away with it and ends
up in jail. The Wolf of Wall Street is thus essentially a morality tale situated in the inancial sector. Even a WASP-man can go too far, so be careful what you wish for (but wish
for it we will). Whether the spree of sex, drugs and extravaganza is amusing depends
on one’s taste; evidently many people think it is. Otherwise however, the movie does
not even come close to analysing the crisis, or morality for that matter.
The movie problematically reduces the inancial crisis to the biography of one man; a
man who moreover is just a small ish. He is so small that the SEC (‘the inancial FBI’)
acts against him. He is thus far removed from the majority of bankers who steal and
cheat with impunity. He is in all respects the outlier, the rotten apple, the guy you love
to despise, the exception. He is the rotten apple, but with some charm added (which
is the charm of someone breaking the rules). He is the guy you wish to be but are ultimately also relieved not to have become.
This is all analytically inadequate, as (rotten) apples are not a satisfactory unit of analysis: one has to look at the trees, indeed the forest. Of course, there is plenty of decadence, fornication, and lying in the inancial sector and I have no doubt that all these
vices are overrepresented in these districts. But these are symptoms rather than the
disease. Conversely, it would be very surprising if young males, earning lots of money,
taking lots of risk (albeit with other people’s money), operating without meaningful
oversight, cheered on by the media (until 2008 at least) and with bosses recruited from
WASP-fraternities, did not become decadent. Any adequate analysis has to be scaled
up one or two levels. How and why are bankers in a position to waste, speculate and
steal other people’s money in the irst place?
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The Big Short
Although The Big Short (2015) does not address this last question either, it is already
far more interesting than The Wolf of Wall Street. The Big Short presents three asset
managers (played by, among others, Christian Bale and Ryan Gosling) who in 2005
established that there was a gigantic housing bubble, with house-prices being higher
than (stagnating) wages could ultimately sustain. Investment banks were however still
massively trading inancial products (so-called mortgage-backed-securities or MBS’s),
the value of which was directly based on ever-rising house prices. So the asset managers decided to bet against the housing market by shorting the MBS’s that investment
banks trade so voluminously. If they were correct and house prices would indeed fall,
they will earn big time. Much of the movie revolves around the question of whether the
asset managers can pull it of. And of course, the protagonists in the end do and thus
walk away with a lot of money.
The movie exclusively depicts the perspective of the asset managers. They are the
heroes of the movie, or at least they are heroic. The resulting lonely heroes vs. big
villain story is far more interesting than WoWS, as the villains consist of a group of
investment banks. This set-up remains problematic nonetheless. For one thing, the asset managers are inancial sector guys; they are supposedly the good guys but act on
monetary motives only and thus conirm the capitalistic ethos. And, of course, they are
all guys, so the audience can easily perceive them as heroic. This is further facilitated
by them all being white, well-educated and urbanite (like virtually all bankers are). The
victims of the banks, who were tricked and seduced into debt, are absent. These deplorables, as Hillary Clinton called them, do not have a voice in the story and are thus
denied any political agency.
On the positive side, The Big Short tells the story from the perspective of people working against banks. Banks here are unambiguously on the wrong side. And so it should
be. The banks however, also remain anonymous. They are the big bad wolf and as
such also lack clear agency. They are just there and they are just bad. As such the Big
Short is a version of the bad apple-morale, but now the rotten apples are stored in
dozens on Wall Street and they are taken on by some brave (albeit proit-maximizing)
asset managers. Research output:
Margin Call
Voters on IMDB rank Margin Call (2011) lower than WoWS and The Big Short. I disagree. Margin Call goes where The Big Short does not thread. It looks the beast in the
eye. It looks inside investment banks and shows the anatomy of fraud, the systemic
nature of it. It shows organized crime. Margin Call dramatizes the predicaments of a
ictional bank (though inspired by the downfall of the investment banks Bear Stearns and Lehman Brothers). The board members of this hypothetical bank realize that
the inancial products, such as the aforementioned MBS’s, are seriously overvalued. If
they hold on to these worthless assets, the bank will go bankrupt. If they can sell them
to oblivious investors (like pension funds) before news of the worthless subprime mortgages breaks, they’ll come out unharmed. Of course, the bank decides to do the latter.
Margin Call shows this decision-making-process, including the appointment of
a fall guy (which, incidentally is a woman, played by Demi Moore). The fall guy
takes all the blame (of course in exchange for a golden parachute). The strength
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of Margin Call is that it shows how the crime of selling worthless securities (which
is not diferent from the misdemeanours portrayed in the WoWS) is committed.
The CEO, played by Jeremy Irons, understandably wants the irm to survive. The
middle man, played by Kevin Spacey, just does what he is told. The junior guys
don’t really know what is going on, and also do what they are told to do (for which
they are generously rewarded). And the only man who was sceptical about it all
has already been ired. It’s a system that an individual cannot take on (as The Big
Short suggests), and Margin Call shows that. It shows the criminogenic zone that
calls itself the inancial sector.
This is not to say that Margin Call is lawless. Again, the movie follows the motivations
of white, male banksters, once again reducing all victims to voiceless anonymity. What
is more, the movie depicts the predicaments of one bank. Although this bank can be
taken as a pars pro toto, it also echoes the rotten apple thesis, only scaled up a level.
The problem is not that this or that bank was fraudulent. The problem is the functioning of the political-economic system, including supervisors, journalists, academics and
politicians, in its entirety. Margin Call still suggests that a well-meaning CEO might
have made a diferent decision than the Jeremy Irons-played culprit and that things
would have turned out better then. But although investment banks are an important
(and proiting) part of the system, they don’t control it. In the end they too have to play
along (and of course they happily do so).
Wall Street: Money Never Sleeps (WS: MNS)
WS: MNS (2010) is a sequel to Wall Street (1987). It has the lowest rating. It is not
diicult to see why. The love story that makes up a substantial part of it is disconnected
from the main story, without being interesting in its own right. The master-apprentice
relationship between characters played by Shia Labeouf and Josh Brolin doesn’t come
close to the gripping admiration-turning-disgust-relationship of Charlie Sheen and
Michael Douglas in Wall Street. So yes, parts of the movie are boring.
Yet Oliver Stone would not be the great director he is if the movie did not also contain
several brilliant scenes. In the most important scenes, WS: MNS depicts the meetings
at the Federal Reserve (the American central bank) where the biggest political robbery
of all time was conducted. In 2008, 700 billion dollars (the so-called Troubled Asset
Relief Program of Goldman Sachs’ banker-turned-treasurer Paulson) was poured into
the inancial sector, no strings attached. These so called ‘bail-outs’ rescued all the
large banks, including Goldman Sachs, on which the investment bank in WS: MNS is
seemingly based.
Stone thus goes straight to the horse’s mouth, to the meeting of the capos di tutti
capi. In doing so, Stone shows what cannot be shown because it cannot be known
(as central bankers are unelected, unaccountable, unremovable and operate in secret, with minutes of meetings undisclosed). Stone ictionalizes. He shows that the
diference between bankers and the maia is that the former are a legitimate group.
Any reform of the system that keeps these bankers in place is no reform at all, just
a legitimation. Any reform that takes on small ish like the WoWS-hustler or even an
investment bank is just a variation on the saying that ‘for things to remain the same,
something will have to change.’
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Conclusion
Although WS: MNS is the most interesting movie of the set, it is not lawless. Besides
the aforementioned redundant scenes, the victims are once again anonymous, and
that is again problematic. That, however, is not the most problematic aspect of WS:
MNS or any of the other movies. In all four movies the straightjacket of plot-driven
storytelling is the gravest limitation. Movies and storytelling in general needs a plot. It
needs events. It needs protagonists. It needs action. But how to show a crisis which is
not an event, not even a series-of-events?
The crisis is the latest apotheosis of a crisis of democratic capitalism that has been
in the making for at least 50 years. The Vietnam War not only discredited the last
moral standing the USA might have had but also threw the post-war Keynesian, socialdemocratic consensus of its feet. The seventies subsequently saw the awakening
of a neoliberal project, which is liberal in its rejection of the welfare-state and is neo
in its determination to not limit state power but to instead use it for the build-up of a
crony Ersatz capitalism, characterized by inancialization. In 2008 the banks were not
nationalized. The state was privatized. Bankers didn’t so much plunder the treasury,
but turned out to outright own it. The American state threw 700 billion at the banks.
European banks were either bailed-out directly (the Dutch state for example bought
the shares of the insolvent bank ABN AMRO) or indirectly (teaming up as the so called
Troika, the European Central Bank, the IMF and the European Commission have operated since 2010 as debt collectors on behalf of French and German banks, enforcing
banks’ claims on the insolvent Greek state by throwing Greece in debtor’s prison to be
released at an unspeciied moment in the future after all Greek utilities have been sold
to German banks at ire sale prices, after wages and pensions have been decimated
and after all employment rights have been torn up).
The Big Short, Margin Call and Wall Street: Money Never Sleeps illustrate aspects of
the political predicament we are now in. The malpractices of banks that the movies
depict is unsettling in a way books and articles cannot get across. And they have the
potential to engage a wider public. But the movies do not get across the bigger picture. That is of course not the aim of most Hollywood directors, nor would ilm studios
allow that if it was. But critical and engaged directors such as Oliver Stone are also
confronted with intrinsic limitations. Particularly, here every director is confronted with
the general problem of dramatization: how to tell a tale in such a way that it doesn’t become a rounded just-so story with a happy, or at least not too unhappy, ending. And for
the majority of people — that much is clear — the GFC will not have a happy ending.
References
Margin Call (dir. J.C. Chandor, 2011).
The Big Short (dir. Adam McKay, 2015).
The Wolf of Wall Street (dir. Martin Scorsese, 2013).
Wall Street: Money Never Sleeps (dir. Oliver Stone, 2010).
PERFORMING FUTURE FINANCE
THE CRYPT OF ART,
THE DECRYPTION
OF MONEY,
THE ENCRYPTED
COMMON AND
THE PROBLEM WITH
CRYPTOCURRENCIES
MAX HAIVEN
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THE CRYPT OF ART, THE DECRYPTION OF MONEY,
THE ENCRYPTED COMMON AND
THE PROBLEM WITH CRYPTOCURRENCIES
MAX HAIVEN
As I have argued in the irst Moneylab Reader, money is a medium of the imagination.1 While it is often presumed to be a banal and basic substance marked by its
fungibility, ease of use, widespread acceptance and legal status, money also has a
dramatic impact on what and who we imagine is valuable. Conversely, money depends on individuals’ and society’s constant imaginative labors to reairm its power,
especially in an age of immaterial and iat currencies devoid of any possible usevalue outside of capitalist exchange. By extension, I argued that we need to reassess
and deepen our aspirations for currency reform: at some level all schemes for ‘ixing’
money, no matter how technocratic, have encrypted within them deep ideological
and philosophical assumptions which, if we fail to disinter them, usually lead us to
reproduce or re-inscribe the ills of the current system in our plans and protagonism
for a new one.
With that in mind I want to, here, return to these questions of value, the imagination,
currency and power by undertaking what might at irst seem like a curious question:
what can the fate of art today, in an age of its rapid and dramatic inancialization, teach
us about the pitfalls lying before those using the latest technological tools to develop
supposedly ‘autonomous’ crypto-currencies? At stake here is, once again, to question
the very relationship of value and imagination that so vexes anyone looking deeply
into today’s capitalist economic system with an eye to change (or abolish) it.2 To approach an answer, however, we will have to exit the complex, if seductive, cathedral of
monetary theory and philosophy for a moment and descend into the crypt, where the
bodies are buried.
*
Sequestered in the winding roads of an industrial park, next to the airport tarmac, a
mere block away from the garrison of the border police, the Singapore’s Le Freeport
stands isolated from its neighbors behind layers of razor-wire fences. This is a purpose-built, highly secured luxury warehouse for the storage of artworks. While dozens
of freeports of this nature exist around the world--mostly in Europe--Le Freeport is
unique in size, ambition and design.
1
2
Primavera de Filippi and Samer Hassan, ‘Measuring Value in the Commons-Based Ecosystem:
Bridging the Gap between the Commons and the Market’, in Moneylab Reader: An Intervention in
Digital Economy, Geert Lovink, Nathaniel Tkacz, and Patricia De Vries (Eds), Amsterdam: Institute
for Network Cultures, 2015, pp. 74–91, http://networkcultures.org/blog/publication/moneylabreader-an-intervention-in-digital-economy/.
Max Haiven, Cultures of Financialization: Fictitious Capital in Popular Culture and Everyday Life,
London and New York: Palgrave Macmillan, 2014.
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With an invitation, you might speak through an intercom to guards and be buzzed
through several state-of-the-art security gates before you enter the compound itself
and take in the black and red facility. Then you will pass through a battery of checkpoints more rigorous than any airport. You will hand your passport, through a two-way
drawer, to an invisible guard in an oice on the other side of one-way glass. Courteous
staf will instruct you to empty your pockets into a small box and place it, along with
your bags, in an x-ray machine while your body proceeds through the L3 full-body
scanner. The millions of dollars of state-of-the-art security, and the slick, chrome, grey
and red modernist style contribute to a feeling of weightless contemporariness, a sort
of weaponized neutrality: the aesthetic of inancial liquidity itself.
Security is only the secondary objective of all this infrastructure, the candid, curious,
debonair warden of the horde explained in January of 2017 as he led me into Le Freeport’s massive atrium, enmeshed in a huge specially commissioned sculpture and surrounded by identical security doors. The designers and architects worked as closely as
possible with the world’s leading insurance irms to guarantee that the building, mere
meters from the tarmac of one of the busiest airports in Asia, presented an almost
zero-risk environment. In any case, he joked: were a thief actually able to breach the
state-of-the-art security, where would they go? Singapore is a highly militarized island
connected to Malaysia by two bridges and otherwise surrounded by ocean.
The primary reason for the ‘extreme vetting’ of visitors, my guide conides, is the same
reason for the ‘starchitecture’ and massive atrium sculpture: it’s a kind of inancial
theater. It is not only to impress upon wealthy clients that their art treasures are safe in
the crypt, but that they are worthy and estimable subjects for owning objects worthy
of such concern, and for investing in their protection. Like Foucault's panopticon, this
hypersecuritized, ininitely surveilled dark-utopian apparatus not only controls space,
it creates subjects.3
Here, an impossible to ascertain number of cultural treasures lie encrypted, from delicate and one-of-a-kind ancient Chinese urns to conceptual artworks printed on A4
paper. ‘We don’t know and we don’t want to know what’s in the vaults’ the warden
tells me, a man who himself marvels at the ironies and contradictions of his vocation.
His job, he explains, is to ofer Le Freeport’s clients rooms (of variable dimensions, depending on need) that are and will forever be 22 degrees centigrade, 55% relative humidity (unless otherwise requested) and as close to risk-free as possible. What those
clients chose to encrypt in Le Freeport is their private business, with a tiny modicum of
state oversight. While technically objects stored in the luxury warehouse exist on Singaporean soil, until they leave the facility by the front door and enter Singapore-proper,
their owners pay no tax — it is as if they are still sitting on the airport tarmac, to which
Le Freeport has special access rights directly from its back gates. Backup generators
stand ready in the unlikely event of power disruption, and a waterless ire-suppression
system will suck out the oxygen from a room and replace it with nitrogen to ensure no
damage comes to the art hoard within.
3
Michel Foucault, Discipline and Punish: The Birth of the Prison, trans. Alan Sheridan, New York:
Vintage, 1979.
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The chain of accountability is nebulous, to say the least.4 The Swiss company that built
the facility also has spun of a management company to operate it, which in turn leases
space to clients like Christie’s and various other irms specializing in the delicate and
secretive world of ine art sales, storage, handling and restoration. These companies
might be hired by a museum of a collector or a gallery (or a shell company set up by
any of the above) to house an artwork. What precisely is inside the crypt is anyone’s
guess, though we can be reasonably sure that expensive works of art must be held
therein. The record of ownership, like the owners themselves, could be anywhere in
the world. What is certain is that Le Freeport exists in Singapore to take advantage of
the quasi-authoritarian capitalist city-state’s unique location (close, but not too close
to China), its notoriously strict laws, a militarized population of highly-educated native
English speakers, a transparent system of property law in accordance with neoliberal
international treaties, and, most importantly, proximity to booming Asian (especially
Chinese) art markets.
Presuming that there is indeed art within Le Freeport, then it is art’s crypt. I mean this
in three interwoven ways.
First, freeports are essentially is a hermetically sealed, risk-free zones where art objects can be placed to ensure that they retain their value purely as an investment
vehicle.5 While there are viewing rooms within Le Freeport its real purpose is to remove art from worldly circulation, while preserving it for purely inancial or speculative
circulation. An art object thus encrypted may never move an inch, but the rights to its
ownership may be sold or transferred thousands of times. So the freeport is a kind of
architecture of global inancialized capitalism that encrypts art within its walls. A crypt
is not simply a tomb: a crypt seals in the dead in order that they still might live, after
a fashion: we builds crypt around the dead to impress upon the living their value, to
haunt the imagination.
Second, freeports encrypts art as a kind of money: the art exists in the world as a kind
of inancial code, a digitally-manipulated asset to be transferred and parlayed. Like an
encoded word transmitted in a public broadcast, inancialized art still transmits meaning and value, but only to those who bear the keys of decryption, in this case those
with enough wealth to buy the work, ship it to elsewhere and uncrate it again as art.
Here art, that notoriously illiquid asset, that notoriously unruly child of capitalism, is
liqueied into a market substance. This is thanks, in large part, to the rise of transnational communications networks and computing power that have been turned towards
creating a globe-spanning inancial, logistical and legal infrastructure-ecology which
can translate anything, even a thing so unique and disobedient as art, into an indiferent commodity for speculation.6
Finally, due to the way freeports transforms art into a purely conceptual object on capital’s terms, under its own economy and order of value it in a way completes the task of
4
5
6
Sam Knight, ‘The Bouvier Afair’, The New Yorker, 8 February 2016, http://www.newyorker.com/
magazine/2016/02/08/the-bouvier-afair.
Hito Steyerl, ‘Duty-Free Art’, e-lux 63 (March 2015), http://www.e-lux.com/journal/duty-free-art/.
Randy Martin, Knowledge LTD: Towards a Social Logic of the Derivative, Philadelphia: Temple
University Press, 2015.
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the ‘death of art’ in a way the avant-garde was never able to. In Peter Bürger’s authoritative analysis, the objective of these art movements was to abolish the separation of
art and life as a form of political agitation that sought to liberate human creativity from
the gilded prison of artistic institutions and its chosen protagonists (those fortunate or
privileged enough to be deemed ‘artists’).7 In the latter part of the 20th century radical artists spearheaded the ‘dematerialization’ of art itself towards this end, developing practices of conceptual art, activist art, performance art, institutional critique and
participatory art.8 Le Freeport, and the inancialized order of which it is a part, seems
to have succeeded in part based on the radical labors of artists who insisted that art
needed no physical presence or trace to function as a socially transformative force.
But in the case of the Le Freeport, art has dissolved into a inancialized everyday, not
a horizon of liberation but of terrifying power and inequality. In this sense, the freeport
is the tomb or crypt of art’s dreams of liberation.
Indeed, the rise of freeports like this one in Singapore is part and parcel of a broader
tendency to transform art into a target of inancialized manipulation and generator of
speculative wealth. For as long as there has been a thing we call ‘art’ (since roughly the
17th century) it has been tied up with money: the tastes and demands of the wealthy
— often inanciers and speculators — shaped the development of Western art history
and, indeed, led to the manifestation of ‘art’ as a discrete area of human achievement,
activity and production (as contrasted to craft, ornament, or kitsch).9 Art was a key
vehicle for the reproduction of the capitalist class and art appreciation and collecting
proved a means to cultivate belonging, distinction and esteem within elite worlds.10 But
in previous times art proved a notoriously illiquid asset: it was diicult to ind a buyer
who shared one’s taste and who had ready money to pay. Further, the art market was
(and to a large extent remains) opaque, corrupt and confounding to all but insiders.
Over the past decade institutions like Le Freeport, responding to the proliferation of
inancially-enriched so-called ‘high net worth individuals’ (HNWIs) the world over, have
sought to increase the liquidity of art markets. These include all manner of ‘innovations’: price indexes like the Mei-Moses that purport to ofer a relection on art investment trends;11 new online art tracking and pricing applications and websites that
provide up-to-the-moment price information; developments in art insurance and collateralized lending to allow collectors to leverage the value of their art/investments;
increasing friendliness from banks and inancial institutions towards art as investment
and collateral; the concentration of art sales in the hands of a few branded global
mega-galleries; the multiplication of art fairs into inancial metropoles around the world
7
8
9
10
11
Peter Bürger, Theory of the Avant-Garde, Minneapolis, MN: University of Minnestoa Press, 1984.
Claire Bishop, Artiicial Hells: Participatory Art and the Politics of Spectatorship, London and New
York: Verso, 2012; Stevphen Shukaitis, The Composition of Movements to Come: Aesthetics and
Cultural Labor after the Avant-Garde, London and New York: Rowman & Littleield, 2016.
Janet Wolf, The Social Production of Art, New York: New York UP, 1984.
Pierre Bourdieu, Distinction: A Social Critique of the Judgement of Taste, Cambridge, MA: Harvard
University Press, 1984; Jean Baudrillard, For a Critique of the Political Economy of the Sign, St.
Louis, MO: Telos, 1981.
Noah Horowitz, Art of the Deal: Contemporary Art in a Global Financial Market, Princeton, NJ
and London: Princeton University Press, 2011; ‘Art and Finance Report 2016’, Luxembourg:
Deloitte, 2016, https://www2.deloitte.com/content/dam/Deloitte/lu/Documents/inancial-services/
artandinance/lu-en-artandinancereport-08092014.pdf.
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and their evolution from stufy trade shows into luxury mega-events; the dominance of
the auction market by essentially two ambitious corporations, but also the proliferation
of start-up online auction and sales platforms; even the (overhyped but signiicant)
development of art investment funds that essentially allow many investors to jointly
purchase pieces purely for their speculative value.12
*
Yet the umbrage we often take at the ‘inancialization of art’ should be tempered. First,
while inancialization is real, art is far from its most important victim, in spite of how
much its profaning might hurt our romantic feelings. Financialization, I have argued,
refers to an economic, political, sociological and cultural shift towards the dominance
and the inluence of inance; not only does the inancial sector of capitalism have
massive power over (other) corporations, the policies of nation-states and the prices
of things like food, land, housing and water, but inance’s ‘logics’, its codes, measurements, metaphors and methods begin to seep into and reconigure a wide variety of
social institutions (universities, charities, public sector services) and shape everyday
cultural life as well.13 Why should art be aforded a special exemption?
As Suhail Malik has argued, the inancialization of art is not the shocking exception
to the rule; it actually has a lot to tell us about the nature of today’s inancial markets
themselves.14 We assume that, unlike other more ‘useful’ commodities that at their
base have some material value, art’s price derives purely from its symbolic and relational value to collectors and art institutions. But Malik argues today ‘neoliberal inancialization’ (my term, not his) is marked by the proliferation and power of money well
beyond any referent to ‘real world value’: inancial objects like derivative contracts, as
Randy Martin notes, have real power over the economy but are seemingly completely
detached from any tangible ‘reality’ of use-values or labor power.15 This being the case,
Malik argues that the absurd shenanigans, occult practices and bad business of the
art market are not the exception but the exemplar of how inance works today: it is the
product of multiple interwoven, mutually dependent and institutionally reproduced acts
of symbolic evaluation and pricing. Like the value of contemporary art, the value of
On these trends, see Andrea Fraser, ‘L’1%, c’est Moi’, Texte Zur Kunst 83 (2011); Noah Horowitz,
Art of the Deal; Suhail Malik and Andrea Phillips, ‘Tainted Love: Art’s Ethos and Capitalization’,
in Contemporary Art and Its Commercial Markets. A Report on Current Conditions and Future
Scenarios, Maria Lind and Olav Velthuis (eds), Berlin: Sternberg, 2012, pp. 209–240; Emily
Rosamond, ‘Shared Stakes, Distributed Investment: Socially Engaged Art and the Financialization
of Social Impact’, Finance and Society 2.2 (19 December 2016): pp. 111–26; Hito Steyerl, ‘DutyFree Art’; Mark C. Taylor, ‘Financialization of Art’, Capitalism and Society 6.2 (9 January 2011);
Olav Velthuis, Talking Prices: Symbolic Meanings of Prices on the Market for Contemporary Art,
Princeton Studies in Cultural Sociology, Princeton, NJ: Princeton University Press, 2007; Olav
Velthuis, Cosmopolitan Canvases: The Globalization of Markets for Contemporary Art, New York,
NY: Oxford University Press, 2015; ‘Art and Finance Report 2016’.
13 Haiven, Cultures of Financialization.
14 Suhail Malik, ‘The Ontology of Finance: Price, Power, and the Arkhéderivative’, in Collapse Vol.
VIII: Casino Real, Falmouth, UK: Urbanomic, 2014, pp. 629–811; Suhail Malik and Andrea Phillips,
‘Tainted Love: Art’s Ethos and Capitalization’.
15 Randy Martin, Knowledge LTD: Towards a Social Logic of the Derivative; Dick Bryan and Michael
Raferty, Capitalism with Derivatives: A Political Economy of Financial Derivatives, Capital and
Class, London: Palgrave Macmillan, 2006.
12
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inancial products is (in spite of much pompous ballyhooing from insiders) the arbitrary
manifestation of competing claims to value based on representation, cunning illusion,
aesthetic manipulation and personal and professional relationships within interlocking
social and institutional circles.
I agree with this assessment for the most part, but I am not convinced today’s forms
of capitalist money, even in its highly inancialized and weaponized form, has given up
all relationship to an underlying ‘real’ form of value. Malik’s analysis draws upon the
theories of Jonathan Nitzan and Shimshon Bichler, who make a complex argument
summed up in the deceptively simple phrase ‘capital is power’.16 That is: the violent
torrents of money that lood and recede around the world do not ultimately stem from
any particular wellspring but churn endlessly. Money is the weapon of power, and
money’s power is the result of it being weaponized by the powerful.
This stands in contrast to two more common theories of money’s origins and power.
The irst is the classically liberal and conventional neoliberal idea that money is simply
a sophisticated evolution of the natural human act of bartering: producers come to the
marketplace with diferent commodities to exchange; for the sake of convenience they
consent to use one commodity as the universal referent to facilitate all trades, overcoming a whole range of problems. For neoliberals, this mythological original moment
of money deines its nature — today’s inancialized iat currencies are merely the more
complicated expression of this tendency.17
In contrast, Marx’s notion of money questioned the peace and tranquility of this vision of money’s origins and argues that, under capitalism, the commodities brought to
market are the result of the exploitation of workers.18 Money carries encrypted within
it the residue of this exploitation, and it functions in the world to enable more exploitation: it is the threat and reward that conscripts non-owning producers (the proletariat)
to the will of non-producing owners (the bourgeoisie). Money is also, for Marx, the
worldly manifestation or appearance of capital itself, the systemic presence behind the
economy of capitalist accumulation, the totality of capitalist social relations that makes
itself the means and the ends of almost all human activity.
For Nitzan and Bichler posing capital-as-power objects to both frames. On the one
hand, it rejects the classical liberal and now neoliberal idea that money is simply a
neutral tool. Rather, money is used and manipulated by the powerful (including imperialist nation-states and exploitative capitalists) to further entrench, reproduce or
expand their power. On the other, this approach rejects the Marxian notion that money
ultimately stems from the exploitation of workers and represents, in skewed form, their
stolen labor power. In contrast, for Nitzan and Bichler while capitalist exploitation still
occurs (and is enabled by and rewarded by money), money itself is not ultimately an
expression of oppressed or exploited labor.
16
17
18
Jonathan Nitzan and Shimshon Bichler, Capital as Power, London: Routledge, 2009.
For a radical anthropological critique of this position see David Graeber, Debt: The First 5000
Years, New York: Melville House, 2011.
Anita Nelson, Marx’s Concept of Money: The God of Commodities, London and New York:
Routledge, 1999; Costas Lapavitsas, Political Economy of Money and Finance, London and
Basingstoke: Macmillan, 1999.
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Certainly there is a great deal of merit to this claim, especially in an age of inancialization where the value of money seems more dependent on inancial currency speculation and inter-imperialist manipulations of exchange rates and iat money supplies. In
an age when the outstanding volume of derivatives contracts — which can essentially
function like money — exceeds the (already skewed measure of the) world’s GDP by
a factor of thousands, it’s hard to make a case that ‘money’ (whatever that is) is either
the ‘scaled-up’ expression of some basic human tendency to truck and barter (qua
neo-classical economics) or the magnitude of hijacked socially necessary labor time
invested in the creation of commodities (qua Marx).
Still, for both theoretical and political reasons, I retain a idelity to some dimension
of the labor theory of value and Marx’s insistence that we see labor as the source
of all wealth and there for encrypted within the money form.19 Theoretically, I am
wary of the idea that money is, today, merely the product of the play of arbitrary
power relations. I think we need to hold fast to the reality that money is the means
by which a global system of capitalism is orchestrated, regulated and organized,
even if that organization is chaotic, nonsensical and plagued by morbid crises.
Without discounting the very real power of the capitalist state (while not forgetting the adjective), no other force on earth other than capital has created a form
of money like the one we witness today, and certainly no other force has elevated
money to the alpha and omega of the world it creates. I agree that money is never
neutral, but under capitalism the power that reproduces money, and that is reproduced by money, is capitalism, and its particular characteristics and dependency
on the exploitation of labor is vital to keep in mind, even when we follow money into
its inancial extremis.
Second, I think we potentially make a dangerous political mistake when we think
of money outside of labor. As Harry Cleaver illustrates, Marx wrote Capital and, in
particular, the irst chapter of Capital on commodities and money, as a means to
put a conceptual weapon in the hands of the working class.20 It essentially argued,
against the classical liberal economists who gloriied wealth and power, that workers were the source of all the world’s wealth, that they therefore had power if they
acted together, and that they had the natural right to not only reclaim that wealth
but reimagine, on a mass scale, the nature of value. Workers had the duty to negate
their own negation, to overturn a system that made them miserable, exploited and
alienated. I break with classical Marxists in my understanding of labor and value
in broader terms. I see the term labor as in many ways a misnomer all too often
reserved for industrialized manufacturing, when it ought, I think, to be more productively thought of as imaginative cooperative energies which take place both within
formal workplaces and also in the realm of social reproduction (the bearing and
raising of children and maintenance of homes and communities), whether waged
I am here generally sympathetic to many of David Harvey’s eforts to likewise explain complex
inancial, monetary and economics shifts through this lens; see David Harvey, The Limits to
Capital, 2nd edition, London and New York: Verso, 2006; David Harvey, The Enigma of Capital,
Oxford and New York: Oxford University Press, 2010; David Harvey, Seventeen Contradictions
and the End of Capitalism, Oxford and New York: Oxford University Press, 2014.
20 Harry Cleaver, Reading Capital Politically, Edinburgh and San Francisco: AK Press, 2000.
19
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or unwaged.21 I see ‘value’, ultimately, not as a hard and fast thing to be measured
in labor hours but the way the capitalist accumulation harnesses, shapes and contorts the realm of values; that is to say, capitalism transforms and depends on the
transformation of what and who we imagine is valuable.22 There is a dialectical
relationship between how we imagine value (individually and collectively) and how
we cooperate together and to what ends. Capitalism ultimately seeks to shape this
cooperation towards its own reproduction.
For that reason, I see money as the crypt of the imaginative-cooperative dimension
of labor. Money, the worldly manifestation of capital, translates our cooperative energies into a solidiied (even if still dematerialized) form, which is ofered back to us as
the means to access the fruits of our cooperation. This was the ultimate meaning of
Marx’s notion of the commodity fetish, where we are so alienated from the thing we
(the proletariat, the cooperating creators) have created that it appears to us not as
our own creation but as if endowed with a kind of supernatural value.23 Money, the
ur-commodity, the ultimate manifestation and facilitator of this process is also the
ultimate manifestation and facilitator of commodity fetishism.24 As David Graeber
argues, weaving together Marx’s theories and the ideas of 19th Century anthropologist Marcel Mauss, when we hold money we actually hold the counterfeit of our own
dreams, a fragment of our own collective power ofered back to us as a magical object.25 As I argued in my contribution to the irst Moneylab Reader, this is why money
is a medium of the imagination, and why art involving money can be so potent. When
we decrypt the collective cooperative potential within money it is like splitting the
atom: untold power awaits.26
*
I have provided this all too brief theoretical explanation to make clear my further unpacking of the notion of encryption, on our way to a inal reconsideration of the politics
and potentials of cryptocurrencies.
21 In this perspective I take inspiration from texts including Massimo de Angelis, The Beginning of
History: Value Struggles and Global Capitalism, London and Ann Arbor, MI: Pluto, 2007; Massimo
De Angelis, Omnia Sunt Communia: On the Commons and the Transformation to Postcapitalism,
London: Zed, 2017; Silvia Federici, Revolution at Point Zero: Housework, Reproduction, and
Feminist Struggle, Brooklyn, NY and Oakland, CA: Common Notions (PM Press), 2012; George
Cafentzis, ‘On the Notion of a Crisis of Social Reproduction: A Theoretical Review’, in Giovanna
Franca Dalla Costa and Mariarosa Dalla Costa (eds), Women, Development, and Labor of
Reproduction: Struggles and Movements, Trenton, NJ, and Asmara, Eritrea: Africa World Press,
1999, pp. 153–88.
22 Max Haiven, Crises of Imagination, Crises of Power: Capitalism, Creativity and the Commons,
London and New York: Zed, 2014.
23 Stephen Duncombe, ‘It Stands on Its Head: Commodity Fetishism, Consumer Activism, and the
Strategic Use of Fantasy’, Culture and Organization 18.5 (2012): 359–375.
24 Nelson, Marx’s Concept of Money.
25 David Graeber, Toward and Anthropological Theory of Value: The False Coin of Our Own Dreams,
New York: Palgrave, 2001.
26 Brian Massumi, The Power at the End of the Economy, Durham: Duke University Press, 2015.
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I am drawing on the term’s psychoanalytic resonances as parsed by Jacques Derrida.27 Drawing on the re-reading of Freud presented by Nicholas Abraham and Maria
Torok, Derrida’s notion of encryption names a process where a constitutive and essential part of a system (language, philosophy, society) must be sealed in a structure,
a crypt, where its status as living or dead is unknown. For Abraham and Torok, both
practicing Freudian psychoanalysts working against the Lacanian turn, encryption
occurs in patients who have witnessed (not necessarily endured) trauma at the hands
of an idolized igure.28 In their re-reading of Freud’s analysis of the pseudonymous
Wolf-Man, the patient’s speech is encrypted because he witnessed the sexual abuse
of his beloved sister by his revered father at a sensitive moment of his development.29
In order to defend the idolized father-object as a central element of his unconsciousness, he encrypted it within his psyche, preserving the projection in a state of both
life and death. Symptomatically, the Wolf-Man exhibited an aversion to certain words
and phrases tangentially related to the internal crypt, rendering his testimony an encrypted message for him and Freud to decrypt in the course of analysis. Yet a key
feature of encryption is the mobilization of all psychic resources to avoid decryption,
for fear of revealing the underlying trauma and being forced to reconstruct the entire psyche without the encrypted object. Meanwhile, however, the Wolf-Man himself
became encrypted within his own crypt — because the psyche is built around the
preserved lost object in the crypt, it is actually the psyche itself that is in the crypt,
both dead and alive.
Without wishing to engage in a lengthy discussion (and problematization) of psychoanalytic methods and theories, the metaphor of the crypt can be highly useful, especially in the capacious sense Derrida gives the phrase: encryption is the process by
which a lost object of projection and attachment is secretly maintained in a state that
is both life and death. This act of inner encryption exhibits outwardly as encrypted
speech or utterance that evades or actively avoids decryption in order to preserve
the system or structure between life and death. For Derrida, as those familiar with his
work might well imagine, some sort of inal decryption and liberation from the crypt
is impossible. He uses the metaphor of the archway (a term that shares an etymology
with crypt in French) to illustrate how a crypt is, in fact, part of a system of mutual
supports. Thus for Derrida decryption does not aim to reveal or discover some ‘true’
inal meaning but, rather, to engage in a deconstructive process of revealing this architecture of mutual reliances.
Like a crypt we might see in a graveyard, both art and money are functional concepts
that, on the surface, appear stable, eternal, perhaps melancholy, but in any case
majestic. Like a mausoleum (a large, public crypt) at the heart of a city, both art and
money have pride of place in the ideological environment of late capitalism — they
are akin to public monuments by which we navigate collective conceptual space.
27 Jacques Derrida, ‘Foreword: Fors: The Anglish Words of Nicholas Abraham and Maria Torok’,
trans. Barbara Johnson, in Nicholas Abraham and Marie Torok, The Wolf Man’s Magic Word: A
Cryptonymy, trans. Nicholas Rand, Minneapolis and London: University of Minnesota Press, 1986.
28 Nicholas Abraham and Maria Torok, The Wolf Man’s Magic Word: A Cryptonymy, trans. Nicholas
Rand, Minneapolis and London: University of Minnesota Press, 1986.
29 Sigmund Freud, ‘From the History of an Infantile Neurosis’, in Peter Gay (ed.), The Freud Reader,
New York: Norton, 1995.
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They are usually completely taken for granted. To the extent they are examined, to
carry the metaphor forward, it is to comment on the architectural features of the
crypt itself: matters of aesthetics or of economics address art and money as if they
were stable categories. My approach, by contrast, is to question what lies encrypted
within, what is held, both living and dead, inside.
The Marxist answer, is, of course (always) labor, and indeed Marx provides us with a
neatly itting metaphor himself: living labor and dead labor. Briely, living labor is Marx’s
category to describe the forms of vital, cooperative human energies that capitalism
seeks to harness and transform into commodities to be exchanged for capital;30 dead
labor is the result: commodities created by the violent harnessing of living labor, the
solidiied essence of human cooperation into a coerced form. Such commodities, this
dead labor, in turn, becomes part of the capitalist apparatus for exploitation of living
labor: it becomes the commodities workers must buy to survive, the alienated infrastructure of capitalist accumulation (factories, machines, housing stock, roads) and,
ultimately, capital itself, including (especially) capital’s ultimate manifestation, money.
Capital itself is the horriic undead rule of labor within and by systems and structures
of its own creation. Money is the ultimate residual expression and reproductive vehicle
of this exploitation and alienation.
In this sense, money might be understood as ‘the common’ in encrypted form. Eli
Meyerhof, parsing the work of Autonomist Marxist theorist Cesare Casarino, draws
out a distinction between ‘the common’ and the ‘the commons’, also present (but not
deined) in the work of Antonio Negri and Michael Hardt.31 The commons, of course,
refers historically to those lands in England reserved for the use of peasants for the
purposes of self-suiciency, whose destruction and enclosure was key to the birth of
capitalism and the rise of a proletarian class dependent on wages and commodities
(rather than common land and self-suiciency) for survival.32 Since that time, the commons has come to name a whole range of ‘resources’ managed collectively, democratically and in an egalitarian way.33 For Nobel Memorial Prize in Economics laureate
Elinor Ostrom, the commons represent a third option, besides the state and markets,
30 Jason Read, The Micro-Politics of Capital, Albany, NY: State University of New York Press, 2003,
pp. 61–102.
31 Eli Meyerhof, Political Theory for an Alter-University Movement: Decolonial, Abolitionist Study
Within, Against, and Beyond the Education Regime, Minneapolis, MN: University of Minnesota,
2013, http://conservancy.umn.edu/bitstream/handle/11299/175513/Meyerhof_umn_0130E_14401.
pdf?sequence=1&isAllowed=y; Cesare Casarino, ‘Surplus Common’, in Cesare Casarino and
Antonio Negri, In Praise of the Common: A Conversation on Philosophy and Politics, Minneapolis,
MN: University of Minnesota Press, 2008, pp. 1–40; Michael Hardt and Antonio Negri, Empire,
Cambridge, MA: Harvard University Press, 2000; Michael Hardt and Antonio Negri, Multitude: War
and Democracy in the Age of Empire, New York: Penguin, 2004.
32 E. P. Thompson, The Making of the English Working Class, New York: Pantheon Books, 1968; J.
M. Neeson, Commoners: Common Right, Enclosure and Social Change in England, 1700-1820,
Cambridge and New York: Cambridge University Press, 1993.
33 Peter Linebaugh, Stop, Thief!: The Commons, Enclosures, and Resistance, Oakland, CA: PM
Press, 2014; David Bollier and Silke Helfrich (eds), The Wealth of the Commons: A World Beyond
Market and State, Amherst, MA: Levellers Press, 2012; David Bollier and Silke Helfrich (eds),
Patterns of Commoning, Commons Strategies Group, 2015.
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for governing the use of and access to resources.34 For many Feminist and Marxist
critics and activists, the commons represent both the method and the horizon of social
change: building and reclaiming common resources (housing, schooling, health, land)
in the present presages and helps set the stage for a more profound system-wide
transformation in the future.35
The common is the virtual conjugation of the actuality of the commons, the force or potential that stands behind every experiment in or instance of the actual commons. The
common, for Cassarino and Meyerhof, represents the potential for commons-oriented
activity pregnant throughout society. Indeed, the common is precisely what capitalism
seeks to organize, coopt and control for its own reproduction and in the name of the
accumulation of private proit. It is the raw force put to work in the capitalist economy,
but rather than reproducing autonomous, democratic social life it is made to reproduce
commodities for the market. Money, as the supreme commodity and the medium of
commodity exchange, is in some sense, then, the representative of the alienation of
the common: it is the crypt of the common, where the common is kept alive (as ‘living
labor’ for the production of commodities) and dead (as in the ‘dead labor’ in the form
of commodities, machines).
*
How then to decrypt the common from the cypher of money? How to escape or avoid
inancialization’s grasp? One technique that has been vigorously proposed and experimented with is the development of cryptocurrencies, which other chapters in this book
address in great detail and with varying levels of enthusiasm.
The optimism behind these currencies is that technological emergence of a method
for organizing a currency without the need for either a physical value-bearing object
(like gold or salt or cigarettes) or a centralized authority to oversee the ledger where
transactions and savings are recorded.36 There are a range of useful applications for
such innovations such as international currency transfers (today monopolized by colonial-era companies like Western Union) or the ability to ofer international solidarity
resources to groups that struggle under oppressive regimes. Such developments have
34 Elinor Ostrom, Governing the Commons: The Evolution of Institutions for Collective Action,
Camridge and New York: Cambridge University Press, 1990; Max Haiven, ‘The Commons Against
Neoliberalism, the Commons of Neoliberalism, the Commons Beyond Neoliberalism’, in Simon
Springer, Kean Birch, and Julie MacLeavy (eds), The Handbook of Neoliberalism, London and New
York: Routledge, 2016.
35 Sivlia Federici, Revolution at Point Zero: Housework, Reproduction, and Feminist Struggle,
Brooklyn, NY, and Oakland, CA: Common Notions (PM Press), 2012; Massimo De Angelis,
The Beginning of History: Value Struggles and Global Capitalism, London and Ann Arbor, MI:
Pluto, 2007; De Angelis, Omnia Sunt Communia: On the Commons and the Transformation to
Postcapitalism, London: Zed, 2017.
36 A few insightful and (refreshingly) critical approaches to Bitcoin and cryptocurrencies include
Ole Bjerg, ‘How Is Bitcoin Money?’, Theory, Culture & Society 33.1 (January 2016): 53–72; Bill
Maurer, Taylor C. Nelms, and Lana Swartz, ‘‘When Perhaps the Real Problem Is Money Itself!’: The
Practical Materiality of Bitcoin’, Social Semiotics 23.2 (April 2013): 261–77; Brett Scott, ‘How Can
Cryptocurrency and Blockchain Technology Play a Role in Building Social and Solidarity Finance?’,
Geneva: United Nations Research Institute on Social Development, 2016, http://www.unrisd.org/
brett-scott.
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also proven useful in attempts to (partially) detach communities from the exploitative
global economy, allowing them to set up reliable systems of local exchange and microeconomies that support solidarity economies.37 The Cooperativa Integral Catalana is
perhaps one of the most successful examples, although their digital currency does not
use high-caliber cryptographic techniques and is very rudimentary (and, note, functions just ine in spite of that).38
Yet in spite of these more practical applications of cryptocurrency technologies the
vast majority of enthusiasts seem ixated on it portending a seemingly revolutionary
and epochal transformation.39 Part of this is due simply to the fact that today cryptocurrencies are the objects of intense speculation (though generally by a very small
faction of people or investors). As in the art world, a speculative economy depends in
no small part on ill-deserved hype, and there are numerous true believers, snake-oil
salesmen and hangers-on eager to provide it. Unfortunately, as David Golumbia illustrates (focusing on Bitcoin), all too often what underlies that hype is a far-right and
free-market libertarian notion of money and society, one that largely sees the state and
those ‘dependent’ on it as the reason why capitalism doesn’t function as it ought.40 For
adherents to this paradigm (most of whom have little idea that their ideology has a dark
and racist provenance), a decentred ‘autonomous’ currency will remove the state from
the equation, allowing markets to function ‘naturally’ and delivering us to the peace
of a fabled meritocracy wherein those with talent and determination will be rewarded,
with better results for everyone.41
From this dominant approach, cryptocurrencies aim to decrypt money. According to
this logic, money is, in essence, a pure and neutral tool, evolving out of humanity’s
natural tendency to labor specialization and barter exchange. Along the way, between
the mythic ‘then’ and the sordid ‘now’, money’s neutrality has been compromised or
encrypted: its codes and values have been layered-over by a new set of codes and
values. For some, money has been encrypted by the state: the right to create and
manipulate money is jealously hoarded and monopolized by governments that use
this power to reproduce their own power. For others, this encryption of money has
emerged from the power of large banks and inancial corporations that use their inlu-
37 See Primavera de Filippi and Samer Hassan, ‘Measuring Value in the Commons-Based
Ecosystem: Bridging the Gap between the Commons and the Market’, in Geert Lovink, Nathaniel
Tkacz, and Patricia De Vries (eds), Moneylab Reader: An Intervention in Digital Economy,
Amsterdam: Institute for Network Cultures, 2015, pp. 74–91, http://networkcultures.org/blog/
publication/moneylab-reader-an-intervention-in-digital-economy/.
38 Claudio Cattaneo and Aaron Vansintjan, ‘A Wealth of Possibilities: Alternatives to Growth’,
Brussels: Green European Foundation, 2016, http://gef.eu/wp-content/uploads/2017/02/
GEF_BackgroundStudy-screen-ok.pdf; Hirota Yasuyuki, ‘Monedes Socials i Complementàries’,
Oikonomics 6 (2016), http://oikonomics.uoc.edu/divulgacio/oikonomics/ca/numero06/dossier/
yhirota.html.
39 Nigel Dodd, ‘The Social Life of Bitcoin’, Theory, Culture & Society, Forthcoming (2017), http://
eprints.lse.ac.uk/69229/1/Dodd_The%20social%20life%20of%20Bitcoin_author_2017%20
LSERO.pdf.
40 David Golumbia, The Politics of Bitcoin: Software as Right-Wing Extremism, Minneapolis:
University of Minnesota Press, 2016.
41 A. Maddox, S. Singh, H. Horst, and G. Adamson, ‘An Ethnography of Bitcoin: Towards a Future
Research Agenda’, Australian Journal of Telecommunications and the Digital Economy 4.1 (2016),
http://wombilical.net/ajtde/2016-03-v4-n1/a49.
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ence in markets and over governments to stymie competition. So even though they are
based on the latest cryptographic developments, ideologically and practically cryptocurrencies promise to decrypt money and return it to its original source code.
By contrast, the notion of money I have provided here would centre on the way money
is not and has never been a neutral or pure tendency. It’s not just that, as Nitzan and
Bichler insist, money is always a weapon of power. It is also that, as I have argued,
money takes on very particular characteristics under capitalism, characteristics that
remain present (indeed, intensify and complicate) under inancialization. To summarize:
money is the false coin of our own dreams, our own imaginative-cooperative potential
ofered back to us in skewed and abusive form. It is both the lifeblood of capitalism
and also the means by which capitalism disciplines, alienates and exploits us. Under
capitalism money becomes the unquestionable and ruling force, the means and the
ends of social relations. Financialization is not only the acceleration of the cycles of
accumulation, it also represents the iniltration of this logic into all realms of social life.
The inancialization of art is a bellwether of this tendency: even the realm of allegedly
non-purposeful or non-instrumental artistic action is turned into a generator of proit
and an object of speculation.
From this perspective, what would decrypting money mean? It would mean to take
collective actions that allow us to act, cooperate and produce value within, against and
beyond capitalism. It would mean the decryption of the common that is today sealed
within money through the creation and sustenance of particular commons or processes of commoning, as Massimo De Angelis frames them.42 It would mean the creation
of alternative, non-capitalist solidarity economies. It would mean sabotage, subversion
and theft from reigning capitalist institutions. All this in the name of creating more and
more opportunities for people to exit their dependency on capitalism and create new
relationships and communities, new autonomous socio-political formations, and new
methodologies of social reproduction and care.
Cryptocurrencies and the underlying blockchain technologies could potentially help us
achieve these ends. They can become means to manage, in transparent and eicient
ways, the coordination of our cooperative energies in local and small-scale initiatives,
though I’m not convinced that this requires the magnitude of cryptographic security
most such currencies insist upon.
Further, these technologies could, if combined with developments in visualization and
narrativization, help us imagine and make democratic and equitable decisions about
the big-picture problems that face communities. They can also help us imagine and
create networks between such initiatives that will allow for the complex coordination
of cooperation in a world beyond capitalist money. For instance, how could these
technologies help us imagine and implement a global (or at least translocal) system
for managing and distributing highly specialized or fragile commodities (like computers or perishable medicines) beyond the current global assembly line and logistics
mainframes which are hideously exploitative to workers, consumers and the planet?
42
De Angelis, Omnia Sunt Communia.
PERFORMING FUTURE FINANCE
135
There are numerous applications when we focus on the question of the common and
the commons. What is key is to understand is that such applications will need to
emerge from the material terrain of solidarity and struggle, not from the fantastical conjectures of enthusiasts. The reality is that we don’t actually need more ‘innovation’; we
need developers to do the relatively unromantic work of training and facilitating nontechnical people’s use of these technologies, improving user interfaces and adapting
and popularizing already-existing technologies. Moreover, we need more people to
simply be involved with grassroots struggles for collective liberation, not wasting their
time (and our resources) trying to come up with technologically-driven ‘solutions’ to
social problems no one asked them to solve, or ‘disrupting’ things in ways that in no
way challenge or change the existing power structures.
Those who would bear the cryptocurrency standard should take some time to examine
the fate of the artistic avant-gardes addressed all too briely above, whose renegade
and hopeful artworks, each informed by admirable theoretical and political sophistication, lie encrypted in Le Freeport, a kind of grim monument to inancialized capitalism’s
powers of adaptation and cooptation.43 Brilliant individualistic acts of resistance or
innovation, no matter how cunning, are easily enfolded back into that system: this is
precisely how it evolves and survives. To challenge the system it is necessary instead
to join the work of decrypting the common, allowing us to cooperate on the basis of
non-capitalist values and, in so doing, produce non-capitalist value.
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_____. Omnia Sunt Communia: On the Commons and the Transformation to Postcapitalism, London:
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43
On the sophisticated ways inancialized capitalism emerges, in part, from the capture of avantgarde energies, see Stevphen Shukaitis, The Composition of Movements to Come: Aesthetics
and Cultural Labor After the Avant Garde, London Rowman & Littleield International, 2016; Luc
Boltanski and Eve Chiapello, The New Spirit of Capitalism, trans. Gregory Elliot, London and New
York: Verso, 2005.
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Cafentzis, George. ‘On the Notion of a Crisis of Social Reproduction: A Theoretical Review’, in
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Casarino, Cesare. ‘Surplus Common’, in In Praise of the Common: A Conversation on Philosophy and
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Cleaver, Harry. Reading Capital Politically, Edinburgh and San Francisco: AK Press, 2000.
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Dodd, Nigel. ‘The Social Life of Bitcoin’, Theory, Culture & Society, Forthcoming (2017), http://eprints.
lse.ac.uk/69229/1/Dodd_The%20social%20life%20of%20Bitcoin_author_2017%20LSERO.pdf.
Duncombe, Stephen. ‘It Stands on Its Head: Commodity Fetishism, Consumer Activism, and the Strategic Use of Fantasy’, Culture and Organization 18.5 (2012).
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Filippi, Primavera de, and Samer Hassan. ‘Measuring Value in the Commons-Based Ecosystem: Bridging the Gap between the Commons and the Market’, in Geert Lovink, Nathaniel Tkacz, and Patricia
De Vries (eds), Moneylab Reader: An Intervention in Digital Economy, Amsterdam: Institute for
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Fraser, Andrea. ‘L’1%, c’est Moi’, Texte Zur Kunst 83 (2011).
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Graeber, David. Toward and Anthropological Theory of Value: The False Coin of Our Own Dreams, New
York: Palgrave, 2001.
_____. Debt: The First 5000 Years, New York: Melville House, 2011.
Haiven, Max. Cultures of Financialization: Fictitious Capital in Popular Culture and Everyday Life, London and New York: Palgrave Macmillan, 2014.
_____. Crises of Imagination, Crises of Power: Capitalism, Creativity and the Commons, London and
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_____. ‘The Commons Against Neoliberalism, the Commons of Neoliberalism, the Commons Beyond
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_____. Seventeen Contradictions and the End of Capitalism, Oxford and New York: Oxford University
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Avant Garde, London Rowman & Littleield International, 2016.
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Velthuis, Olav. Talking Prices: Symbolic Meanings of Prices on the Market for Contemporary Art, Princeton Studies in Cultural Sociology, Princeton, N.J.: Princeton University Press, 2007.
_____. Cosmopolitan Canvases: The Globalization of Markets for Contemporary Art, New York, NY:
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THINGS THAT
TRANSACT: HOW THE
INTERNET OF THINGS
IS TRANSFORMING
PAYMENTS
RACHEL O'DWYER
CRITIQUES OF THE GRAND SCHEMES
139
THINGS THAT TRANSACT: HOW THE INTERNET OF
THINGS IS TRANSFORMING PAYMENTS
RACHEL O’DWYER
When my wallet is connected to your wallet, something in its nature must change.
[...] In 10 years’ time, my smart wallet and your smart wallet are going to be talking
to each other and we won’t be in the loop so much, we won’t be bothered.
—David Birch1
Eighteenth century literature was rife with stories of dumb, inanimate things: the inner
life of a corkscrew, the hidden desires of a top hat, a day in the life of a watch, what
the kite saw or the pin overheard. A subset of these ‘it narratives’, as they were called,
concerned the secret lives of monetary tokens, with ictions tracing the circuitous journeys of paper banknotes and the people they encountered. Mary Poovey observes
how the ‘talking note’ illuminated the various social contracts and encounters that took
place in economic exchanges at the time.2 Popular accounts were Thomas Bridge’s
Adventures of a Bank Note (1759-1775),3 and Charles Jonhstone’s Chrysal; or, the
Adventures of a Guinea (1760-1765).4 Chrysal tells his reader of the moment he was
forged in a mine in Peru and the stories of who and what he encountered as he was
passed from hand to hand. Talking notes betray the idea that the stuf of transactions
was animate or sentient, more than a ‘dumb, lifeless prop’ in exchange. These things
didn’t just serve the wishes of their immediate possessors: they were agents in their
own right, they had wants and desires; they spurred action as they met and interacted
with other stuf; they observed and recorded everything they came into contact with;
and they might just as easily betray or ‘tattle’ on their owners.
Things have always intervened in the construction of markets. They transact, trade,
intervene, monitor, calculate, circulate and abstract. As Viviana Zelizer5 and more recently Bill Maurer and Lana Swartz have explored,6 economic mediation is composed
of tons of diferent stuf, from paper tokens and coins, to checks, promissory notes,
tallies, dongles, plastic, and electrical impulses. Things are always already ‘market
devices’, part and parcel of the material-discursive assemblages that shape the economy.7 But today our things are really taking a front seat in economic exchange. The
1
2
3.
4.
5
6
7
David Birch, cited in Bill Maurer, ‘Late to the Party: Debt and Data’, Social anthropology 20.4
(2012): 474-481.
Mary Poovey, Genres of the Credit Economy, London: University of Chicago, 2008, p. 148.
Thomas Bridge, Adventures of a Bank Note, New York, NY: Garland Pub., 1759-1775.
Charles Johnstone, Chysal; or, the Adventures of a Guinea, London: Printed for T. Becket, 17601765.
Viviana A. Rotman Zelizer, The Social Meaning of Money, London: Princeton University Press,
1997.
Bill Maurer and Lana Swartz (eds), Paid, Tales of Dongles, Checks and Other Money Stuf, Boston,
MA: MIT Press, 2017.
Fabian Muniesa, Yuval Millo, and Michel Callon, ‘An Introduction to Market Devices’. The
Sociological Review 55.2 (2007): 1-12.
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OECD currently estimates some 25 billion connected things will be online by 2020.8
One application of these devices is for mobile or ‘ambient’ payments, with the option to pay for things using things beyond the usual credit card or checkbook — with
iPhones and FitBits, cars, fridges, cameras and shoes coming to the register.
This short piece is a call to recognize connected things not only as politically animate,
participating in the shaping of discourses and action, as new materialists have been
arguing for a while, but also to think of these connected things as economic actors that
play a role in the shaping of market elements such as exchange, price, the production and circulation of goods, and relations of debt and credit. With the proliferation of
the ‘its that transact’, we can begin to ask: How will markets transform as connected
things proliferate and come to the fore of exchange? What does it mean for things,
not just humans, to exchange and transact? How does their appearance in the marketplace intensify trends towards algorithmic and data-driven market decisions? For
example, how will things negotiate the construction of credit, risk and price? Or will
people trust their personal objects to perform transactions on their behalf?
Our Objects are Playing a Greater Role in Exchange and Will Continue to Do So
in the Future.
Much like the rise of ubiquitous computing and promised invisible computation,9 talk
today of ‘seamless’, friction-free, and ambient commerce promises that, with the rise
of an Internet of Things (IoT), the messiness of exchange will fade into the background.
No more fumbling in your pocket for the right coins as your car approaches the tollbooth, or standing in-line to make inane chitchat with the cashier about how well that
dress will suit you. Intelligent things will come to the fore of the market, transacting,
abstracting and calculating on behalf or even independently of human users. This intervention doesn’t only occur at the point of sale, with the wrist tap, or an authoritative
nod from an RFID or Bluetooth enabled device, but all throughout the market.
Connected things increasingly mediate transactions, either on behalf of their users or
of their own bat in what are sometimes called machine-to-machine (M2M) payments.
We are probably already familiar with instances of these — the growth of contactless
payments, e-tolls that automatically pay for motorway use and the development of
Amazon Dash buttons being a few examples. Phones, watches and FitBits also authorize in-store purchases; household utensils and white goods stock up on everyday
essentials; vehicles invisibly transact in fuel, parking spaces and repairs; smart grids
and infrastructures purchase and exchange energy resources and data or engage
in carbon trading.10 When things come to the fore of the market they produce new
kinds of money and new payment infrastructures, but also potentially a whole new
understanding of the sociality of exchange — how ‘its’ transact, negotiate, barter and
8
9
10
Organisation for Economic Co-operation and Development, Working Party On Communication
Infrastructures And Services Policy, ‘The Internet Of Things: Seizing The Beneits And
Addressing The Challenges’, Background Report For Ministerial Panel 2.2, http://www.
oecd.org/oicialdocuments/publicdisplaydocumentpdf/?cote=DSTI/ICCP/CISP(2015)3/
FINAL&docLanguage=En.
See for example, Mark Weiser’s ‘The Computer for the 21st Century’, Scientiic American 265.3
(1991): 94-104.
Initiatives such as the Visa Ready Program exist to integrate tokenised/secure payments into a
range of everyday wireless objects in collaboration with hardware manufacturers and retailers.
CRITIQUES OF THE GRAND SCHEMES
141
settle, and the norms, practices and protocols that develop around these activities.
What does the kettle desire? What did the fridge buy from the breast pump? What is
your toaster saying about your credit worthiness?
Most human-to-human transactions are structured by legal and social norms (such as
those around bargaining, haggling, and the construction of price), mediated by tokens
like paper money and credit cards, and supported by age-old institutions such as
banks that allow the rest of us to cooperate and transact with people we don’t know.
In the future, transactions between humans and things and between things and other
things may largely be structured by software-deined rules. Many technologists already
propose the use of smart contracts,11 not only as a way of securing data produced by
so many connected devices against hacking or government surveillance,12 but also as
a means to automate trades and transactions between things and other things. Smart
contracts recorded on the blockchain and designed to automatically execute conditions for the use and transfer of property rights would allow objects connected to the
Internet of Things (cars, houses, energy infrastructures and so on) to be sold or leased
in pre-deined ways, or so the argument goes. Imagine a self-driving car that can be
rented, paid for with personal data from a phone or wearable, opened with a smart key,
and which stores some of its proits away in order to pay for fuel, repairs and parking
spaces, all according to pre-ordained rules.
Autonomous machine-to-machine transactions raise questions not only about security, as seen with the recent DDoS attacks mobilized by printers and baby monitors,13
but also about cultures of exchange: Who wants transactions to be invisible or just
‘fade into the background’? And how might the material or psychosocial attachments
people have with their possessions shape the nature of these transactions? Does your
weighing scales or your wardrobe mirror put you in the mood to shop? Are you more
likely to trust your fridge to authorize a transaction over your necklace, or your car?
Things Will Transform and Produce New Markets
Another recent trend has been for material things to trade in the leftover capacities
they produce, such as energy, excess computer processing units, spare bandwidth,
or access to whatever utility or service they produce. In 2016, the Industry conference
Money 2020 placed emphasis on how the Internet of Things might facilitate markets
in this material latency a trend already rife in the sharing economy, where owners can
trade the leftover capacities in their cars with taxi services, spare rooms in their hous-
11
12
13
Smart contracts are contracts that are recorded on the blockchain and designed to automatically
execute predeined rules for the use and transfer of property.
Paul Brody and Pureswaran Veena. ‘Device Democracy: Saving the Future of the Internet of
Things’, IBM, (September 2014).
On 21 October 2016, the Mirai botnet was used to coordinate a global DDoS attack on Dyn, a
cloud based internet performance management company, resulting in outages for Airbnb, HPQ,
the Guardian, Visa, Xbox Live, Twitter, Amazon and many more. What was signiicant about this
attack was that the hackers targeted not personal computers in the sense many of us would
understand it, but a host of seemingly innocuous devices – printers, baby monitors, IP cameras
and digital video recorders. The botnet targeted IoT devices that were protected by little more
than factory-default passwords, gained access and enlisted these objects in coordinated attacks
on major internet platforms. It felt like Revenge of the Domestic Devices. This brings to the fore
questions about the dangers of IoT infrastructure, namely regarding security and encryption,
questions that become even more signiicant where transactional data is involved.
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es, or even their spare time. But with many networked devices transacting, as the new
imaginary goes, a thing might trade equity in just about any ‘thing’ for anything else.
Imagine, for example, an umbrella that sold shares itself whenever it rained — not too
farfetched in China, where umbrella rental is already up and running — or an Airbnb
style property with a luctuating rental price that in turn speculated and purchased
shares in proitable start-up companies nearby. ‘Its that transact’ imagines a kind of
luidity to connected things, that our leftover stuf might shake of their material casings and whatever makes them unwieldy or ‘lumpy’, as Yochai Benkler puts it (2004),
and become instead pure value or information — the ingredients of an on-demand
economy with a place for everything and everything in its place.
Money-like things, as Chrysal the guinea observed, have the peculiar ‘power of entering into the hearts of their immediate possessors and there reading all the secrets of
their lives’.14 ‘It narratives’ were constructed around the idea that if only the coin could
speak, oh, the stories it might tell! With connected devices, things now trade in what
they’ve seen and where they’ve been. As well as transacting in and with other stuf,
connected devices are developing techniques for negotiating the sale or barter of the
data that they gather about their use, their users, and their broader environments.
These see complex ‘data markets’ assembling around connected devices, as networked objects develop new protocols and practices to appraise and autonomously
exchange the material they gather from relational entanglements. Data becomes a
currency that can be exchanged for goods and services or for other kinds of data sets.
Complex matching systems have to be developed to evaluate and price this data and
make it transferrable. Sometimes this data is traded, or it is sold or it gets turned into
other kinds of value such as iat money, airtime, or loyalty points. A washing machine,
a water meter and a iltration system might enter into a market relationship about the
exchange of water consumption data, for example. A self-tracking itness wearable, a
fridge, 0% fat yoghurt and an online retailer might transact in relevant behavioral and
transactional data in exchange for rewards such as loyalty points or coupons. If we
are already familiar with the ‘fridge-buys-milk’ vignette of the Internet of Things, here a
connected fridge might trade data about its user’s grocery consumption with a retailer
in exchange for discounts on future food purchases.
Connected Objects Also Intervene in Calculation and Abstraction.
Smart devices will deine and intervene in the formation of prices and in the construction of inancial instruments such as credit and risk. Our things are learning
to keep account. We are probably already familiar with the ways in which algorithmic devices such as high-frequency trading and pricing algorithms are reshaping
markets, as well as the ways in which this can go very wrong (see, for example
the Flash Crash of 2010 and the inconsistencies with Berkshire Hathaway stock),
but now our smart things and their datasets, will also intervene. Though still very
much a prospective practice,15 data gleaned from connected things, particularly
self-tracking data from wearables and household devices, might soon play a role in
the pricing of health insurance premiums. The use of wearables for personalized in-
14
15
Johnstone, op.cit, (1760), p. 3.
Liz McFall, ‘The Politics of Personalised Insurance Pricing in the Age of Wearable Devices’, Draft
Paper, 2017.
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surance not only produces data that can precision risk but it also has the recursive
efect of shaping its owners’ behavior, enabling these companies to optimize the
ways humans exercise or eat, have sex and shop.
An Internet of connected Things will also contribute to the calculation of credit. The
secret patterns and social life of our things may now determine our eligibility for a
mortgage or loan. Mobile phone, transactional and social network data already play a
signiicant role in credit for the ‘underbanked’, with companies such as Zest Finance
and Kreditech ofering loans based on multiple networked data points gleaned from
mobile payments, device usage and social media. Connected things such as cars,
wearables and household devices now also provide a greater degree of data monitoring that can be used to produce credit oferings based on social graphs, biometric data
or on logistical data provided by an Internet of Things. Kabbage, one such company
that specializes in small loans for SMEs, makes use of over 5,000 data points from
each loan applicant, including their existing credit data and mobile phone data, but
also data gleaned from commercial vehicles, GPS logs, the manufacturing of goods,
return rates, and supply chains, to determine the conditions of a loan.
How Might Things Fight Back?
Today connected things play a role in the transfer and circulation of property, in the
construction of prices and evaluation, and in how credit and risk are calculated and
apportioned. When things begin to transact with one another, when they become economic actors, we should think about the implications this has for the future of markets.
Arguably what’s new here is the peculiar materiality of these things and their intimate
connections with people, not just that they represent an intensiication of algorithmic
governance in market processes.
As things get more lively, and as a vast range of data-gathering things proliferate
around everyday users and their transactions, markets are becoming more dynamic
but also harder to read and unpick. This is a question not only of how algorithmic
governance and big data will shape the future of markets, but also how various material cultures will play a role in shaping the economy going forward. Things are not just
more of the stuf of software or data repositories; they are also lively objects with their
own psychosocial narratives.16 In other words, it’s not only the status of the thing as
a market device with computational and networked capacity that might be signiicant
in the future, but also its own peculiar material culture and people’s relationship and
attachment to it.
If the Internet of Things becomes central to payments we will also become more
entangled with our things and entangled with markets. Much like other algorithmic
market devices such as high-frequency trading algorithms and online pricing mechanisms, things are now ‘designed to detect and respond [not only to the rhythms
of their users and their everyday interactions, but also] to market rhythms’.17 The
sociality of exchange now includes the social lives of many non-human things and
16
17
Anthony Dunne, Hertzian Tales, London: MIT Press, 1999.
Christian Borch, Kristian Bondo Hansen, and Ann-Christina Lange, ‘Markets, Bodies, and
Rhythms: A Rhythmanalysis of Financial Markets from Open-Outcry Trading to High-Frequency
Trading’, Environment and Planning D: Society and Space 33.6 (2015): 1080-1097.
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their protocols and proclivities. Arguably this makes it very diicult for humans or
users embedded in these systems to disentangle themselves or ‘opt out’ of a inancial system, if such a thing were ever possible.
Mackenzie et al. call for us to consider the materiality of markets: their physical, technological and corporeal nature.18 In Mackenzie’s case this concerns how physical geography, distance and the materiality of wired signals help to construct prices. With
the growth of things that transact, we should consider how the material speciicity of
our connected devices might come to shape and intervene in markets. We need to
think about the socio-economic life of these actors as they enact exchanges, as they
‘detach things from other things and attach them to other things’.19 How might luctuations in temperature and bacterial organisms shape the ways in which fridges transact,
or environmental conditions transform the speciics of rental markets? How might our
smart cars drive speculation over fuel up or down? How do objects work alongside
humans, exerting inluence on our moods, decisions and dispositions?
How might things begin to ight back? Equally important, we might start to think about
how objects might frustrate or resist commodiication in a market. Tales of IoT hacks,
as well as playful indings like @internetofshit, open up an imaginary for a kind of economic resistance that might be speciically non-human in nature. Like the household
devices that double-crossed their owners in the Mirai Botnet attack, objects might
ight back, changing cultures of exchange or resisting altogether. We should consider
the ways in which objects — commodities, minerals, metals, plastics, sensors and
actuators — might not only impede the will of homo economicus but act out economic
trajectories, behaviors and ‘desires’ of their own.
References
Borch, Christian, Kristian Bondo Hansen, and Ann-Christina Lange, ‘Markets, Bodies, and Rhythms: A
Rhythmanalysis of Financial Markets from Open-Outcry Trading to High-Frequency Trading’. Environment and Planning D: Society and Space 33.6 (2015).
Brody, Paul, and Pureswaran Veena. ‘Device Democracy: Saving the Future of the Internet of Things’,
IBM, (September 2014).
Bridge, Thomas. Adventures of a Bank Note, New York, NY: Garland Pub., 1759-1775.
Dunne, Anthony. Hertzian Tales, London: MIT Press, 1999.
Johnstone, Charles. Chysal; or, the Adventures of a Guinea, London: Printed for T. Becket, 1760-1765.
Maurer, Bill. ‘Late to the Party: Debt and Data’, Social anthropology 20.4 (2012).
Maurer, Bill, and Lana Swartz (eds), Paid, Tales of Dongles, Checks and Other Money Stuf, Boston,
MA: MIT Press, 2017.
MacKenzie, Donald, Daniel Beunza, Yuval Millo, and Juan Pablo Pardo-Guerra. ‘Drilling Through
the Allegheny Mountains: Liquidity, Materiality and High-Frequency Trading.’ Journal of Cultural
Economy 5.3 (2012).
McFall, Liz. ‘The Politics of Personalised Insurance Pricing in the Age of Wearable Devices’, Draft
Paper, 2017.
Muniesa, Fabian, Yuval Millo, and Michel Callon, ‘An Introduction to Market Devices’, The Sociological
Review 55.2 (2007).
18
19
Donald MacKenzie, Daniel Beunza, Yuval Millo, and Juan Pablo Pardo-Guerra. ‘Drilling Through
the Allegheny Mountains: Liquidity, Materiality and High-Frequency Trading.’ Journal of Cultural
Economy 5.3 (2012): 279-296.
Fabian Muniesa, Yuval Millo, and Michel Callon, ‘An Introduction to Market Devices’, The
Sociological Review 55.2 (2007): 1-12.
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Organisation for Economic Co-operation and Development, Working Party On Communication Infrastructures And Services Policy, ‘The Internet Of Things: Seizing The Beneits And Addressing The
Challenges’, Background Report For Ministerial Panel 2.2, http://www.oecd.org/oicialdocuments/
publicdisplaydocumentpdf/?cote=DSTI/ICCP/CISP(2015)3/FINAL&docLanguage=En.
Poovey, Mary. Genres of the Credit Economy, London: University of Chicago, 2008, p. 148.
Rotman Zelizer, Viviana A. The Social Meaning of Money, London: Princeton University Press, 1997.
Weiser, Mark. ‘The Computer for the 21st Century’, Scientiic American 265.3 (1991).
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CASH IN THE ERA OF
THE DIGITAL PAYMENTS
PANOPTICON
BRETT SCOTT
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CASH IN THE ERA OF THE DIGITAL
PAYMENTS PANOPTICON
BRETT SCOTT
You cannot burn digital money. Not unless you are prepared to engage in arson. To
burn digital iat would require undertaking a mission to an industrial park to burn
down the fortiied datacentre of a large bank like Barclays. But even then, they
would have backups, and to fully burn the digital money supply you would have
to destroy all bank and central bank datacentres. Our everyday digital pounds,
dollars and euros do not reside in your computer or on your phone. They reside as
records imprinted on huge bank-controlled computer arrays, attended to by cooling
systems and power generators. Your laptop or smartphone is just there to interact
with those central hubs.
Cash, though, you can burn. In the 2008 Batman ilm The Dark Knight, Heath Ledger’s
Joker burns a small mountain of it to demonstrate just how little he cares for the petty
grasping of ordinary criminals who seek out the physical surety of paper dollars in
hand. The desire to hoard cash — like Scrooge McDuck swimming in his money bin
— is a defensive sign of fear, an attempt to build a direct bufer of control over other
people and your environment.
The ability to burn, though, reveals a crucial distinction between cash and digital money. Destruction requires personal autonomy over the thing being destroyed. You cannot burn digital money for the simple reason that you do not directly control it.
Cash Versus Money
The irst time I ritualistically sacriiced cash was at a music festival in the California
desert. It burned with a green-blue lame, my claim upon the products of society reduced to smoke traces. These burning rituals can help to illuminate hidden dark arts
of monetary policy. Money is not a store of value. Rather, it is a tokenized claim that
enables you to access, control, or mobilize value that resides in goods and services.
Burning money does not destroy value. Rather, it burns up your ability to control the
value embedded in the products of other’s labor.
At the heart of modern economies is a two-part play. Real goods and services are produced by real people using real materials, aided by technology. This real value, though,
is not directly exchanged in markets. Rather, one party — the ‘seller’ — gives a speciic
real good or service in exchange for tokens dispensed from a ‘buyer’ that grants the
seller access to a general pool of potential goods and services from others in future.
In other words, current and speciic value is exchanged for claims upon potential and
general value. The entire capitalist system is built upon this basic social algorithm. It
forms a sprawling, interconnected web of enmeshed transactions, a myriad of real
things lowing in response to movements of money tokens that grant access to a pool
of potentially real things.
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In this context, the power to intervene in the money system is a means to exert control
over the low of underlying value and the labor that produces it. Central banks’ attempts to expand or contract the money supply — via the commercial banks — are attempts to exert indirect control over people’s bodies, minds, and emotions, mobilizing
them to produce value, or slowing them down.
We live, however, with two modes of money. Cash is our system of physical tokens —
the type you can burn — that are manually transferred to complete transactions. Then
we have the bank datacentres. Here our money tokens take the form of ‘data objects’,
inscriptions recorded onto a ledger by an authority granted power to record-into-existence and ‘keep score’ of money units for you. This is your bank account. Rather than
physically transporting this money, we ‘move’ it by sending messages to our banks —
for example, via our mobile phone — and asking them to edit the data. Money ‘moves’
to your landlord if your two respective banks can agree to edit accounts, reducing your
score and increasing your landlord’s score.
This latter form of privately-issued digital bank money is much more dominant than
cash, forming over 90% of the UK money supply.1 Nevertheless, the way we think
about money always suggests physicality. We talk of money ‘moving’ or ‘lowing’,
about ‘depositing’ and ‘storing’ it, and about ‘lending it out’, as if it were some kind of
grain. Many economics textbooks still insist that a core feature of money is ‘portability’.
Type ‘money’ into a Google image search, and you’ll ind a mass of images of physical cash. Type ‘digital money’ in, and you’ll get pictures of cash dissolving into data,
or cash lying through wires. Even in the digital realm, we ixate upon the cash form.
A mental and linguistic slip occurs. The term ‘money’ and the term ‘cash’ get blended.
David Wolman’s 2012 book about the ‘coming cashless society’ was titled The End of
Money, as if the end of cash meant the end of money itself, rather than the end of but
one form of money. The term ‘demonetisation’ was used to refer to the Indian government’s 2016 retraction of banknotes, rather than the term ‘de-cashiication’.
This confusion seeps into the media. The Panama Papers were leaked in 2016, the
website claiming to show tax-dodging ‘Politicians, criminals and the rogue industry
that hides their cash’.2 It should have read ‘the rogue industry that hides their digital
bank deposits’. Articles accompanying it showed men passing dule-bags of dollar
bills, rather than automated systems altering data entries in ofshore bank accounts.
This ixation upon ‘cash-as-money’, therefore, doubles as a blindness towards the
custodians of digital money. People imagine digital money as an emergent ‘update’
to cash, rather than an entirely parallel system run by banks. Digital money isn’t an
update to cash. It’s an update to the old account books that old bankers used to write
in with quill pens. Few people recognize that cash is one of the last bulwarks we have
against a completely commercial bank-dominated money system.
1
2
See ‘Where Does Money Come From? A guide to the UK monetary and banking system’, New
Economics Foundation, 12 December 2012, http://neweconomics.org/2012/12/where-doesmoney-come-from/.
See ‘The Panama Papers: Politicians, Criminals and the Rogue Industry that Hides their Cash’,
International Consortium of Investigative Journalists (ICIJ), https://panamapapers.icij.org/.
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The War on Cash
Against this backdrop of confusion, we see a concerted corporate and political efort
to remove that bulwark. The emerging ‘cashless society’ looms — according to evangelists — like a futuristic sunrise, cleansing us of these ilthy notes with rays of hygienic
digital salvation. And, it was in response to this lawed and disorientating public narrative that I published two popular essays: The War on Cash3 and In Praise of Cash.4
A central point I tried to convey in both was that the phrase ‘cashless society’ is essentially a euphemistic way of framing the ‘bank payments society’, a society in which you
will have to rely upon the banking sector to move money around. Calling a bank digital
money system ‘cashless’ is like calling an all-cash economy ‘the bankless society’. By
drawing attention to what is not present, you distract from what actually is present.
There are three commercial interest groups who stand to beneit from such a society.
The irst is the banking sector itself, which controls the underlying bank account infrastructure that people will have to use in a cashless society. The second is big payments
companies like Visa and Mastercard, who facilitate the transfer — or, more accurately,
editing — of money between those bank accounts. The third is the broader inancial
technology — or intech — industry that builds services on top of this, like phone apps
and payments gadgets that are plugged into this infrastructure.
While there have long been predictions of a cashless society, the intech industry has
in recent years become increasingly powerful in economic clout and political inluence. They, alongside the established oligopoly players like Visa, are on the ofensive
against cash for purely self-interested reasons. This growing lobby attempt to use
their media and advertising power to slowly erode the public’s attachment to cash,
but their ofensive is also conditioning elite political attitudes. In 2017, for example,
the EU Commission suddenly saw it it to investigate the implementation of cash
thresholds5 — limits on the amount of cash that can be used. The EU has promoted legislation like the Revised Payments Services Directive (PSD2) that encourages
more integration between banks and intech companies, a move that supericially
appears to threaten individual banks but on net seeks to strengthen the overall digital
inance ecosystem that is built upon the banking system. This innovative momentum
is juxtaposed against older systems like cash. The digital payments industry presents
itself as waiting in the wings to take over, making these types of political pushes more
feasible than they were previously.
The political push for cashlessness, however, is not merely due to the capture of state
authorities by inancial corporations. Government oicials have their own reasons too.
In forcing people to use the banking system for all monetary transfers, the bank payments society allows far greater monitoring of people’s transactions. This is deemed a
positive step forward in the battle against crime and terrorist inancing, but the pros-
3
4
5
See Brett Scott, ‘The War on Cash’, TheLong+Short, 19 August 2016, http://thelongandshort.org/
society/war-on-cash.
See Brett Scott, ‘In Praise of Cash’, Aeon, 1 March 2017, https://aeon.co/essays/if-plasticreplaces-cash-much-that-is-good-will-be-lost.
See ‘EU Initiative on Restrictions on Payments in Cash’, European Commission, 2017, https://
ec.europa.eu/info/consultations/eu-initiative-restrictions-payments-cash_en.
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pect of monitoring political subversion and opposition looms large in certain countries.
And then there’s tax. A senior state tax oicial casually told me over drinks that the
reason they’re pushing cashlessness is to better monitor the income and expenses of
small businesses and individuals. Finally, there is the monetary policy angle. Central
banks would like greater power to implement forms of monetary policy that cash hampers, in particular the ability to remotely erode people’s bank balances through negative interest rates to get them to spend.
We see an emergent alliance between digital payments companies, banks, central
banks and governments, and the far-reaching voice of such powerful interest groups
calmly asserting the inevitability of cashlessness impacts public attitudes. The overt
propaganda campaigns that lood people with positive messages about digital payments are but one element of this voice. Subtler forms of cultural hegemony — the
mainstream newspaper reporting on the Bank of England cash study, or the respectable CEO talking about the EU cash thresholds debate on BBC — repeat and reinforce
negative narratives about cash as a dangerous and outdated form.
Many people going about their everyday business do not have strong opinions or concerns about cash — and are certainly not out there campaigning for its demise — but
often in my conversations about this issue people repeat the mainstream mantra that
cashlessness is inevitable. When asked why it is inevitable, they often vaguely allude
to a kind of ‘natural progress’ towards digital payment. When asked what the driving
force of this ‘progress’ is, they say things like ‘people just like technology’, or alternatively, ‘digital payment is pretty convenient’.
The convenience narrative is very common, and yet it is problematic on two accounts.
Firstly, it is not actually obvious that cash is inconvenient. I have experienced contexts in which the cash system has failed — in Mozambique in the early 2000s where
certain remote towns sufered from acute shortages of cash, and in Zimbabwe — but
those societies sufered from serious problems in non-cash payments too. In many
economies it is extremely easy to use cash, and requires no prior setting up of bank
accounts, waiting for cards, minimum payment amounts, and so on.
Secondly, inconvenience is not an inherent property of cash, but rather a contextual
property that emerges when the cash-supporting infrastructure is neglected or withdrawn. In other words, it is possible to engineer inconvenience and irritation by deliberately making cash harder to use. For example, banks in various European countries
are cutting down on the number of ATMs and branches they provide,6 which in turn
frustrates people trying to get cash, and which in turn makes digital payment look
comparatively easy. They then showcase the inconvenience — that they themselves
have engineered — as a reason for why digital payment is superior. On the back of
India’s ‘demonetisation’ debacle, Visa launched its #KindnessIsCashless campaign
6
See International Monetary Fund, ‘Automated Teller Machines (ATMs) (per 100,000 Adults)’, The
World Bank, https://data.worldbank.org/indicator/FB.ATM.TOTL.P5. The statistics show ATMs
per 100,000 adults. Declines — some very signiicant — are noted for Denmark, Estonia, Finland,
Netherlands, Norway, Spain, Sweden, Iceland, Ireland, Latvia, Lithuania, Austria, Belgium, Greece
and France. The statistics show that the Euro area as a whole has seen a signiicant decline in
ATMs per 100,000 adults since 2010.
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in the country. They produced a video7 showing a frustrated elderly teacher standing
in a long queue for cash who is then rescued by his students who show him how to
use a digital payments app on his phone. The campaign carefully avoids mention of
the fact that the ineiciency of the Indian cash system has been orchestrated by the
Indian government itself.
Breaking the All-or-Nothing Narrative
If I stand in front of an audience and say ‘Raise your hands if you’d like access to digital
payment’, most would raise their hands. People ind digital payment useful. But if I say
‘raise your hands if you want to have the option to use cash removed’, people are more
hesitant. While we may enjoy the beneits of digital payment in various circumstances
— for example, in the context of internet purchases — many people have no inherent
problem with using cash for everyday in-person purchases, and, given the choice,
would prefer for it to remain an option.
Cashless society proponents, however, are crafting their narrative in such a way as to
fuse the idea of ‘digital payment’ with the idea of ‘no cash’, framing it as a dualistic
either-or choice. They present an all-cash world and pit it against an all-digital world,
and then conclude that an all-digital world is superior. In reality, the best option would
be a hybrid payments system where both are available.
An analogy will help here. Automobile evangelists in the early 1900s might have made
grand claims like ‘cars are the future!’ and predicted the demise of all other forms of
transport, such as the horse-drawn carriage. Indeed, the world’s irst automobile advertisement in 1898 came from the Winton Motor Carriage Company with the tagline
‘Dispense with a horse’.8 The digital payments lobby is doing that right now for cash,
presenting it as the horse-drawn cart of the payments world, outmatched by digital in
all possible respects.
But if we reframe the analogy, we can turn the story on its head. Enter the bicycle.
Bicycles existed prior to cars, and yet in modern society we still use them both. We
recognise them as having pros and cons in diferent situations, and we value having
both available. But it’s deeper than that. In the subsequent history of transport, cars
have led to big problems of congestion, road accidents, pollution, and urban sprawl.
Bicycles, in this context, actually have come to represent a solution to the problems
caused by the car. To bring the analogy back to money, cash is not the horse-cart of
payments but the bicycle. Digital payment is being framed in a futuristic light right
now, but it opens up some extremely negative possibilities that we may have to use
cash to solve.
So what are those potentialities? Three problems need immediate mention. Firstly, the
end of cash will probably mean the beginning of an all-encompassing inancial panopticon that can be used for widespread surveillance, tracking and manipulation of individuals by both states and corporations. Secondly, going all-digital exposes us to far
7
8
See Visa India, ‘A Teacher and Student’s #KindnessIsCashless Story - Visa’, YouTube, 23 February
2017, https://www.youtube.com/watch?v=ISpAtMgKdPw.
See Borroz, Tony. ‘July 30, 1898: Car Ads get Rolling’, Wired, 30 July 2009, https://www.wired.
com/2009/07/dayintech_0730/.
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greater risks of devastating inancial cyberattacks and digital crime. Thirdly, cashlessness brings new forms of digital inancial exclusion, the screening out of anyone who
lacks the ability to interact with the digital bureaucracies of privately-run commercial
institutions that control the money system.
Very few people seem to understand this right now, and the cashless lobby has very
little interest in telling you about these dark sides. Ironically, they are actually trying to
argue the opposite. Take, for example, The Better than Cash Alliance, a lobby-organisation ostensibly run by the UN Capital Development Fund but started and funded by,
among others, Citibank, Visa and Mastercard.9 The primary argument they put forward
is that digital payment can be useful to people in situations of poverty. This in itself
isn’t problematic: of course, if I live in an all-cash economy I may indeed beneit from
the introduction of a new digital option. Their decision, though, to call themselves the
‘Better than Cash Alliance’, rather than, say, the ‘Building Digital Payments Alliance’ is
a bit like a bus transport initiative calling itself ‘The Better Than Bicycles Alliance’. Why
the headline focus on attacking cash rather than showcasing how the digital might be
a useful addition to a rural cash economy?
A cynical observer browsing through their website might conclude that it is a frontgroup representing the interests of the payments industry under the guise of a humanitarian project. They have little to no transparency about who actually sits on their Executive Committee, and investigation reveals a range of current and former payments
industry personnel — from companies like Paypal, Ripple and Square — who advise
them. Among their target audiences are national governments, NGOs and multinational
corporations with staf in developing countries. They see corporates — such as large
clothing brands with outsourced production in poorer countries that pay their low-level
employees in cash — as a leverage point to push digital payments. I met a textiles
entrepreneur from Bangladesh who told me that a corporate member of the Alliance
pressures its suppliers into paying staf digitally.
We need not see this as some kind of conspiracy: It makes sense that an organisation promoting digital payment would recruit the expert services of people working
at digital payment companies, and people who work at digital payment companies
are more likely than most to be convinced of the virtues of digital payment. Nevertheless, it is obvious that they specialize in presenting a one-sided gloriication of the
potential beneits of the digital, whilst ignoring its potential negative consequences,
and then setting this against a negative interpretation of cash as a ‘burden’ upon
poorer people. All of this despite the fact that cash is the one form of money that
currently forms a lifeline to people excluded from services from banks. Every element of their presentation is designed to associate the idea of digital payment with
the idea of cashlessness, rather than presenting digital payment as being potentially
complementary to cash.
Most perplexing, though, is that the Better Than Cash Alliance manages to do this
all without ever really explicitly laying out an argument for why cash is negative. The
9
See ‘Resource Partners’, Better than Cash Alliance, https://www.betterthancash.org/join-us/
resource-partners.
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malice of cash is merely implied, hinted at, and left to the reader to infer, as if it is so
obvious as to not even be worth mentioning. Their lagship line of ‘digital is great’ is
illuminated in such a to way as to cast a shadow of ‘cash is dangerous’.
This may seem pedestrian and benign to an aluent city-dweller in the Western world,
but the message is insidious because it hides an implicit value judgement about formality. It carries an assumption that getting drawn into the mainstream world dominated by large-scale corporations and state authorities is obviously superior, and that
parts of society that do not exist in that world should not rightfully exist at all. The cash
economy is — apparently — a realm of uncontrolled darkness that people must be liberated from, and if they cannot be liberated from it, they must be undesirables. This is a
viewpoint that can lourish among people deeply steeped in privileged institutions, with
economic interests in the ongoing success of those institutions and respectable positions within them. There is no place for the vast grey areas of marginality that includes
people excluded from formal economies, people on the wrong side of oicial law, and
people who thrive on small-scale non-institutional activities, like the busker on a street.
Defending the Grey Areas of Social Progress
The irony is that social progress — if we believe in such a thing — requires grey areas.
In August 2017 I gave a talk at the Crypto-Cannabis Salon in Alameda, California,
an event bringing together the cryptocurrency industry with the cannabis industry.
Marijuana is in the process of being legalized in California and growers are cautiously
stepping into the world of legal, respectable business. For many years, cash has kept
the cannabis industry alive, allowing it to thrive while political activists pushed for its
legalization. For many of those activists the ‘War on Drugs’ is more than just futile. It is
an injustice, an attempt by states to quash ancient plant substances that have beneits
to humanity, whilst arbitrarily accepting tobacco and alcohol corporations that push
products far more damaging. The legalization of marijuana is seen by the activists as a
progressive step forward in humanity.
Seen from this perspective, cash has not merely facilitated ‘drug crime’ — as pre-legalization cannabis growing was categorized — but also simultaneously kept an industry
alive for long enough for laws to be updated. Had cash not been around, the industry
might not have developed, and there would be little to legalize. The strictures of the
digital payments cage would have killed it before it had a chance to showcase its beneits. In a sense, cash nurtured a practice that has now been legitimized.
The problem, however, is that US banks and payments companies are subject to US
federal regulation, and this overrides individual US state regulations. Legal cannabis industry businesses in California, therefore, struggle to get bank accounts or services from
payments companies. In this context, they now see themselves as being ‘forced’ to use
cash, and denied the opportunity to gain the beneits that digital payments ofer. The large
amounts of cash they deal with presents a security problem, and now that they have to
pay taxes, they are forced to physically present bundles of cash at the tax oice. The
money form that has kept them alive for decades is now being perceived as a ‘burden’.
This illustrates an important point, though. Cash is the money form of the underdog, of
the excluded. If you are a new member of respectable elite society, and you are forced
to use it, you feel like you are missing out on a more advanced form. To return to our
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analogy, it is like being forced to ride a bicycle when other members of your class all
have cars. Rather than the bicycle appearing as your friend, and as ‘better than nothing’, it is characterized as ‘slow’ and ‘crude’ and you shout, ‘Why can’t I have a car!’
When, however, you get used to having a car, you may begin to see the bicycle in a
new light. In combination with the car’s long-distance capabilities and speed, your
bicycle appears nimble, eicient for short trips, requiring low maintenance, and so on.
The perspective really depends on your context. Not wishing to rely upon a bicycle is
diferent to saying that bicycles should not exist. Indeed, without bicycles the car might
appear increasingly oppressive.
Third party malware in the capitalist market algorithm
In the cashless bank payments society there is never just a buyer of a product, and a
seller. There is always a third party, a middleman who is required to pass the money between the buyer and the seller. This grants the middleman — banks and payments networks like Visa and Mastercard — a lot of power. They can see your transactions, when
you do them, and where you do them. Furthermore, if they don’t like what you’re transacting, they have the power to prevent it. We thus have the potential for both inancial
surveillance and inancial censorship. When Visa, Mastercard and Paypal decided they
didn’t want people to be able to donate money to Wikileaks,10 they censored not only
Wikileaks but also all the people who felt a moral call to support the organisation.
It’s comparatively easy to alarm people by pointing to overt instances of aggressive
payments gatekeeping and surveillance. The more insidious issue, however, may not
actually be whether some Big Brother is really watching you or not. The cashless society stands to create a widespread feeling of potentially being watched. This is the
essence of a panopticon. The point of a panopticon is not to watch you, but rather to
make you internalize the belief that you’re being watched, and to self-regulate your
behaviour in response. No need to hire armies of watchers, when you can make people
watchers of themselves.
Those who argue for the beneits of such surveillance efects always say ‘if you have
nothing to hide you have nothing to fear’, but we value privacy for reasons beyond trying to hide. Many of us like feeling that we have autonomy and that we can engage in
private economic decisions without an authority looking over our shoulder all the time.
The surveillance society is one in which adults are made to feel like small children who
cannot be trusted.
This surveillance concern is one avenue by which the War on Cash is exposing rifts in
market libertarian philosophy. Isn’t it ironic that our individual privacy may be protected
by the old state cash? Isn’t it ironic that privatized payments systems allow for far
greater state monitoring of transactions?
But the War on Cash presents a second uncomfortable issue for libertarian theorists.
How will overall markets function when every general market transaction has to be
passed through a speciic market of private payments companies that may not have
10
See ‘WikiLeaks: Banking Blockade and Donations Campaign’, WikiLeaks, https://wikileaks.org/
IMG/pdf/WikiLeaks-Banking-Blockade-Information-Pack.pdf.
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incentives to let all players trade? The treasured intellectual ediice of ‘state vs. market’
starts to creak as it becomes more apparent that states support markets by upholding
the base infrastructure that enables them to work. One half of modern capitalist exchange — the money — has a public component. Cash is M0 money, the base money,
the fall-back money, the state money of last resort. It’s the money you use when the
shop’s debit card system crashes. It’s the money you use when you’re a stranger in a
foreign country. Its replacement with the ickle digital promises issued by private commercial banks is risky for good ole capitalism.
And thus, in the context of the cashless society hype, we ind a parallel rise in speculations about ‘state digital money’.11 If we indeed are going to become cashless, and if
private digital payments intermediaries cannot be trusted to keep a market system running for all, there will be pressure to create a public digital payments infrastructure to
guarantee everyone’s ability to transact. Right now, the choice is between commercial
bank digital and state cash, but the imagined future battle is one between bank digital
and state digital.
But, unlike state cash, state digital money is also a potential vector of surveillance
and monitoring. This concern of getting trapped in a prison of watchable payments
inspired the original attempts at building non-state, non-bank digital currencies. David
Chaum — founder of the early privacy currency initiative Digicash — noted this in his
1983 paper ‘Blind signatures for untraceable payments’:
On the one hand, knowledge by a third party of the payee, amount, and time of
payment for every transaction made by an individual can reveal a great deal about
the individual’s whereabouts, associations and lifestyle. For example, consider payments for such things as transportation, hotels, restaurants, movies, theater, lectures, food, pharmaceuticals, alcohol, books, periodicals, dues, religious and political contributions.12
Cypherpunks like Chaum were acutely aware of the potential for state abuse of this
data, but also of corporate abuse. The increased data allows ine-tuned proiling of
individuals, opening up ever-more subtle and advanced forms of manipulation. This
push has continued apace, with large tech irms entering into collaborations with large
inancial irms to create hybrid digital payments systems. Companies like Google already have location and search data and to add payments data would deepen their
knowledge of individuals greatly. With the rise of machine-learning and predictive analytics, these combined data sets are used as the fuel to produce oferings and nudges
that steer you onto future paths. This is a source of that growing feeling — creeping
into the back of our minds — that we are being ‘helped’ and guided by seeminglybenevolent yet eerily overbearing corporate butlers that are always present. It may
appear convenient, but may also carry with it the slow erosion of our personal agency
and clear independent thought.
11
12
See, for example, John Barrdear and Michael Kumhof. ‘The Macroeconomics of Central Bank
Issued Digital Currencies’, Bank of England, July 2016, http://www.bankofengland.co.uk/research/
Documents/workingpapers/2016/swp605.pdf.
See David Chaum, ‘Blind Signatures for Untraceable Payments’, Taxable Anonymous Libre
Electronic Reserves (TALER), https://taler.net/papers/chaum-blind-signatures.pdf.
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Against Autocorrect: Defending a Right to Criminality
The tradition of Digicash is now being carried forward by the likes of Bitcoin, Monero
and Zcash that stand as alternatives to both bank and state digital payment systems.
This places them in the somewhat surprising position of being aligned to state cash,
mimicking its lexibility, anonymity and with that, an association to the criminal underworld where cash is presumed to be king.
The assertion that cash is the realm of criminality remains one of the most pervasive
lines in the War on Cash. To counter it, one could attempt to argue that cash is used
for many things beyond crime, that the crime igures are overstated, or that, even if it
is a crime-facilitator, its beneits justify that.
There is, however, an even deeper problem to the cash-as-crime narrative, something
bigger at stake. As the digital realm expands and seeps into every aspect of our existence, avenues for deviance are being shut down, and this threatens the very basis of
our legal morality. In Ursula Le Guin’s science iction classic The Dispossessed, teenagers on the anarchist planet Anarres condemn the state-corporate hierarchies of the
rival capitalist planet Urras. One asks:
Would you really like to live in a society where you had no responsibility and no freedom, no choice, only the option of obedience to the law, or disobedience followed
by punishment? Would you really want to go live in a prison?
Their point is that living in a society where failure to obey the law automatically results
in punishment is essentially the same as living in a prison. The reason we do not feel
this in our current society is that failure to obey the law does not automatically lead
to punishment. There is a bufer zone of variable probability in which we can take a
chance and maybe get away with it. The speeder on the highway doesn’t always get
caught. The cat-and-mouse game between law-breakers and law enforcement is what
makes law-abiders feel virtuous for having decided to obey the law. If you cannot
break the law — or if its breaking automatically condemns you — you cannot feel virtuous for not breaking it. A world where there is no cat-and-mouse game is one where
the law is a hardcoded auto-enforced electric fence that leaves no room for personal
responsibility in upholding it.
It’s for this reason that we need to protect and uphold a Right to Criminality. A world
without it is a world of Behavioural Autocorrect, and corporate digital payments systems are vectors via which such autocorrect will assert itself. The automatic lagging
of tax infringements, the automatic ining of the traic ofender, the automatic banning
of the political dissident.
The Internet of Fully-Automated Capitalism
The emergent concerns about cashless surveillance and inancial exclusion have led
anti-cash cheerleaders like Kenneth Rogof — author of The Curse of Cash — to preface his speaker tours of the world’s intellectual salons with pre-emptive marketing
CRITIQUES OF THE GRAND SCHEMES
157
material. An advert for his talk at London School of Economics promised that the professor would address issues the removal of cash will pose, ‘ranging from fears about
privacy and price stability to the need to provide subsidized debit cards for the poor’.13
Let’s say Kenneth is right. It is not inconceivable that we could adequately resolve or
reduce problems that accompany the privatization and digitization of all money movement, and put in place protections.
But cast your eyes into the far future. Cash is standing in the way of fully automated
capitalism. We’ve seen our economic system increasingly automated at the production
level, with businesses using robots and conveyer belts. Then we’ve seen it get automated at the management and co-ordination level, the algorithms of work lows and
logistics, and the huge digital platform corporations that hover above smaller players,
matchmaking them. But at the exchange level many transactions remain manual, or
organic. We still have to go through a cognitive decision-making process and — sometimes — a social interaction in order to exchange. It is here that traditional economists
imagine their ‘rational agent’, considering a product in light of their money budget,
deciding whether it is good value, and perhaps bargaining.
To fully automate capitalism — to make it a truly inhuman, machinic system — would
involve not only the automation of production, management and co-ordination, but
also the full automation of exchange. This requires the automation of the seller, the
buyer and the payment process. This is the Internet-of-Things utopia of fridges buying milk from passing drones. This is the world of toll-road payments automatically
triggered by facial recognition as you silently drive by. The further you push this, the
more alienated the individual becomes, a passive participant watching markets unfold around them.
Perhaps we’ll see a cyberpunk dual economy, with cash eking out an underground
existence as a currency for those seeking to preserve the last remnants of human
emotional connection within markets. Perhaps we’ll tell romantic tales of an imagined
past in which red-blooded debates over value were found in marketplaces.
But perhaps it will not reach this stage. You see, while you cannot burn digital money,
you can certainly turn it of. We like to think we’re electro-digital technological gods,
but if our fossil-fuel power transmission lines go down, our cashless economy quickly
chokes to death. Maybe cashless society is a dirty radical conspiracy, the ultimate
Trojan Horse. Make everyone dependent on digital payment, then break the electrical
grid, and watch the system fall like never before.
References
Barrdear, John, and Michael Kumhof. ‘The Macroeconomics of Central Bank Issued Digital Currencies’,
Bank of England, July 2016, http://www.bankofengland.co.uk/research/Documents/workingpapers/2016/swp605.pdf.
Borroz, Tony. ‘July 30, 1898: Car Ads get Rolling’, Wired, 30 July 2009, https://www.wired.
com/2009/07/dayintech_0730/.
13
‘The Curse of Cash’, The London School of Economics and Political Science, http://www.lse.
ac.uk/Events/2016/11/20161123t1830vOT/The-Curse-of-Cash.
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‘Building a New Economy Where People Really Take Control: Our Agenda for Change’, New Economic
Foundation, http://neweconomics.org/about-us/.
Chaum, David. ‘Blind Signatures for Untraceable Payments’, Taxable Anonymous Libre Electronic
Reserves (TALER), https://taler.net/papers/chaum-blind-signatures.pdf.
‘EU Initiative on Restrictions on Payments in Cash’, European Commission, 2017, https://ec.europa.eu/
info/consultations/eu-initiative-restrictions-payments-cash_en.
International Monetary Fund. ‘Automated Teller Machines (ATMs) (per 100,000 Adults)’, The World
Bank, https://data.worldbank.org/indicator/FB.ATM.TOTL.P5.
‘The Curse of Cash’, The London School of Economics and Political Science, http://www.lse.ac.uk/
Events/2016/11/20161123t1830vOT/The-Curse-of-Cash.
‘The Panama Papers: Politicians, Criminals and the Rogue Industry that Hides their Cash’, International
Consortium of Investigative Journalists (ICIJ), https://panamapapers.icij.org/.
‘Resource Partners’, Better than Cash Alliance, https://www.betterthancash.org/join-us/resourcepartners.
Scott, Brett. ‘The War on Cash’, TheLong+Short, 19 August 2016, http://thelongandshort.org/society/
war-on-cash.
---. ‘In Praise of Cash’, Aeon, 1 March 2017, https://aeon.co/essays/if-plastic-replaces-cash-muchthat-is-good-will-be-lost.
Visa India. ‘A Teacher and Student’s #KindnessIsCashless Story - Visa’, YouTube, 23 February 2017,
https://www.youtube.com/watch?v=ISpAtMgKdPw.
‘Where Does Money Come From? A guide to the UK monetary and banking system’, New Economics
Foundation, 12 December 2012, http://neweconomics.org/2012/12/where-does-money-come-from/.
‘WikiLeaks: Banking Blockade and Donations Campaign’, WikiLeaks, https://wikileaks.org/IMG/pdf/
WikiLeaks-Banking-Blockade-Information-Pack.pdf.
CRITIQUES OF THE GRAND SCHEMES
THE DEMONS OF
DEMONETIZATION:
DEVALUING ‘TRUST’
AS A CURRENCY
IN INFORMAL
ECONOMIES,
AN ETHNOGRAPHIC
ACCOUNT
TRIPTA CHANDOLA
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THE DEMONS OF DEMONETIZATION: DEVALUING
‘TRUST’ AS A CURRENCY IN INFORMAL ECONOMIES,
AN ETHNOGRAPHIC ACCOUNT
TRIPTA CHANDOLA
In our business, there is no scope of conducting it on credit or barter. Our bodies
were our ATMs, and now like all others in the city, it has no currency.
—Pooja, a sex-worker and resident of Govindpuri, commenting on the impact of
demonetization.
Pooja and Akki are residents of the lane no. 15 of Govindpuri, a resettlement colony in
South Delhi. They are erstwhile residents of one of the three camps which collectively
constitute, and are colloquially referred to as, the slums of Govindpuri (hereafter, GP),
evoking the spatial proximity with the legal colony as a marker. One of the irst camps
to be settled is across the road from Pooja and Akki’s house. All their oicial documentation still bears that address. The identiication as slum-dwellers allows them to avail
subsidies under diferent schemes, especially for their children’s education. It is on the
account of their professional engagement as sex-workers that they decided to rent a
house in this side of the locality. It gives them freedom outside of constant social scrutiny and judgement, but also a sense of ‘security, ease and trust’ to their clients. Whilst
both of them have partners who live with them, they are the breadwinners of the family.
When I irst got to know them, they were young girls of under 20. I was pursuing my
doctoral research in GP, highly keen and motivated by its soundscapes, but not always
conident about articulating either the research questions or agenda, and was intensely
humbled by the time given by the inhabitants to these ramblings. My acquaintance
with Pooja and Akki was one such encounter, and our relationship, mutual interest and
tenderness in each other’s lives has continued steadfastly ever since. Their age diference is of a couple of years, though it is hard to tell either the diference or their exact
age. Whilst their histories, geographies and negotiations as sex-workers is a demanding (and necessary) narrative to engage and understand the modalities of living on the
margins, in the context of this present discussion the focus is on the intersection of
their bodies, as precarious commodities, and credit-interest enterprises, the mainstay
of their inancial investments and future securities, as precarious networks.
The credit-interest enterprise, or byaaz ka business, as it is colloquially and in its literal
translation referred to, operates on the principle of lending money to the interested
parties on a negotiable interest rate and time period. These loan businesses form a
patchwork of credit and debt connections throughout the community sewn together
with its particular, peculiar practices; negotiating skills and fantastical tales of either
meteoritic gains or colossal failures.
In both these networks, credit and debt, trust as a currency, and the extent to which it
can be accrued, circulated and appropriated, determines the respective position and
beneits that can be accrued.
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From the early days, when the conversations and interactions with Pooja and Akki
were not determined by any speciic research agenda, the importance of ‘trust’ in their
professional lives was constantly insisted on:
Didi, our dhanda (colloquially referring to any business practice, but in popular, cultural reference often evoked to refer to the sex-work) seems to be all random, there
are people who still think we stand by the roads and call out to the customers. We
have never done it. One of the irst things we learn and have to rely on this when we
enter this dhanda is to be part of a trustworthy network. Usually we have to travel to
other cities and engage with men of all kinds of backgrounds — politicians, goons,
muscle-men, etc., in strange hotels and houses, if we are not with people we can
trust we put ourselves in great risk. And in Delhi, most of our clients are either regular or through recommendations. Even they need to be able to ‘trust’ to become
regulars, otherwise as has instances some of them are blackmailed or threatened to
be charged with 376... and sometimes we have to pull out these cards to keep the
customers in tow.
During the last decade, I have closely witnessed the many turmoils the two of them
have to undergo on account of their profession. These have included, but are not
limited to, one of them being threatened at gun point in a hill resort away from Delhi;
a raid in a hotel in Jaipur where they were stationed; and, coming under the cops-onduty’s radar. But whilst negotiating all these hurdles, Pooja and Akki have consistently
worked to improve their lives in ways which the opportunities available to them as
illiterate, young women from the slums would not have allowed. The intent here — in
the capacity of a researcher and as their interlocutor — is not to normalize the violence
which the sex-workers have to undergo, but to insist that the reality and experience
of earning a living as a sex-worker cannot be collapsed into one singular narrative of
oppression and exploitation.
The byaaz ka business operates on the principle of lending money to the interested
parties on a negotiable interest rate and time-period. Both the interest rate and timeperiod are not arbitrarily arrived at but correspond to the present ‘going rate’ in the
credit-interest network. And the backbone of these transactions is the currency of
‘trust’ which both the creditor, but especially, the party seeking a loan can establish. I
will return to the signiicance of ‘trust’ as currency in sustaining these networks, and
the impact of demonitization on disrupting the processes which institute it and thus
causing long-term ruptures (and perhaps need for innovation and invention) in these
networks. However, at the juncture, it is important to acknowledge that the byaaz ka
business operates within the informal practices and networks which are identiied as
a ‘set of activities that lies largely outside of the government regulation and supports’.
Though being outside of the ‘institutional’ purview does not render either the networks
or the transactions lacking regulations in themselves.
But for the moment, I return to Pooja and Akki’s narrative. It is not a matter of mere
coincidence (or convenience) that both Pooja and Akki (and many others in their
network) ind investment in byaaz ka business as a logical continuation of their
professional engagements and inancial investments. Both these involvements accommodate the precarity which becomes of the lives of Pooja and Akki for being
outside the ‘institutional and state regulations’. The former, sex-work, being illegal
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and posing a threat of persecution for its practitioners, whilst the latter, byaaz ka
business, though not strictly illegal, invites scrutiny for the same on account of purporting black money, and illicit activities.
In the last decade, Pooja and Akki through astute and timely investments in the byaaz
ka business managed to accumulate enough money to buy gold, send their children to
private schools and maintain a ‘respectable’ lifestyle. Even their extended families, still
living in the slums, accept them by maintaining a stoic silence and distance from their
choice of profession, especially since Pooja and Akki ofer inancial support to them.
Until 8 November 2016, even though aware of the precarious nature of the transactions
— both as sex-workers and money in the informal networks — both Pooja and Akki not
only felt secured inancially and socially, but also were planning to inally take the ‘big’
plunge of investing in property.
That manfoos raat (fateful night), which at irst was reckoned to be a mazaak (joke)
of sorts by Pooja, Akki and many others, and whose impact as it has been unfolding
since, has in Pooja’s words ‘shifted the ground beneath their feet. Never before, even
with all the problems — cops, raids and everything — have we felt so helpless. Neither
are we in control of our business nor our monies. What has most signiicantly been
compromised is vishwaas (trust) and not to mention the humiliation we have to endure’.
On that ‘fateful’ night, demonitization (notebandi) was announced by the Prime Minister, Narender Modi, in an address to the country on national media in his now characteristic highly performative, hyperbolic style:
The evil of corruption has been spread by certain sections of society for their selish
interest. They have ignored the poor and cornered beneits. [...]
There comes a time in the history of a country's development when a need is felt
for a strong and decisive step. For years, this country has felt that corruption, black
money and terrorism are festering sores, holding us back in the race towards development. [...]
Brothers and sisters,
To break the grip of corruption and black money, we have decided that the ive
hundred rupee and thousand rupee currency notes presently in use will no longer
be legal tender from midnight tonight, that is 8th November 2016. This means that
these notes will not be acceptable for transactions from midnight onwards. The ive
hundred and thousand rupee notes hoarded by anti-national and anti-social elements will become just worthless pieces of paper. The rights and the interests of
honest, hard-working people will be fully protected. Let me assure you that notes of
one hundred, ifty, twenty, ten, ive, two and one rupee and all coins will remain legal
tender and will not be afected. [...]
Time and again, I have seen that when the average citizen has to choose between
accepting dishonesty and bearing inconvenience, they always choose to put up with
inconvenience. They will not support dishonesty.
CRITIQUES OF THE GRAND SCHEMES
163
Once again, let me invite you to make your contribution to this grand sacriice for
cleansing our country, just as you cleaned up your surroundings during Diwali.
Let us ignore the temporary hardship
Let us join this festival of integrity and credibility
Let us enable coming generations to live their lives with dignity
Let us ight corruption and black money
Let us ensure that the nation's wealth beneits the poor
Let us enable law-abiding citizens to get their due share.
I am conident in the 125 crore people of India and I am sure country will get
success.
Thank you very much. Thanks a lot.1
Decoding the Byaaz Ka Business
The biyaaz ka business, which is the practice of raising and loaning cash at and for an
interest (literally translated, business of interest), forms the backbone of the informal
modalities of monetary exchange in the slums of Govindpuri. Most residents of the
three camps have in one way or another been involved in these networks, mostly in the
capacity of raising loans ranging from a few hundreds to more substantial amounts.
The reasons for the residents of the slums to rely on these informal credit networks
are complex and unfold within the particular materiality of negotiating diferent institutions and agencies — here, banks — as slum-dwellers, illiterate and more often
than not lacking cash, credit history, and collaterals. One of the reasons for the panic
that was unleashed — owing to the lack of circulating and available cash among the
urban poor — immediately following demonitization was accorded to the poor not
being part of the formal networks, particularly banking institutions. But the reality
within which the urban poor claims and takes charge of their inancial destiny is far
more complex and complicated.
The ‘trust’ in these informal networks, the access to the agents lending money and the
convenient availability of cash — amount, time and urgency notwithstanding — are
some of the signiicant reasons quoted by the residents of the slums for their reliance
on these networks.
However, the informal nature of these monetary exchanges does not imply an informality of the social structures and networks within which they unfold. In fact, these informal monetary exchanges have a history in the slums, which in turn accords them their
longevity and robustness as a viable and reliable economic practice, as also accruing
the ‘trust’ both amongst the borrowers and the lenders.
One of the many agendas of the demonitization project was to include a signiicant
section of the population — namely, urban and rural poor — in the formal networks,
sectors and practices of banking. In pursuing this rhetoric and agenda with a high de-
1
For the full text of the speech, see: ‘Here's the Full Text of Modi's Speech on the Discontinuation
of ₹500 and ₹1,000 Bank Notes’, Huington Post, 9 November 2016, http://www.huingtonpost.
in/2016/11/08/heres-the-full-text-of-modis-speech-on-the-discontinuation-of_a_21601525/.
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gree of coercion — the analyses in support of the project demonitization lend towards
demonizing informal networks. Within this imagination, of including the urban poor
in formal networks of banking, the social structures and practices within which they
unfold — here, in the materiality of the slums, are identiied to have a lack of social,
cultural and political cohesiveness and solidity. The practices of informal monetary
exchanges in the slums are thus reckoned to have symbiotic relationship to the social
order within which they can thrive, the impetus being to formalize both these at once
towards as a discipling agenda to transform these spaces, and their residents, into
complicit, responsible citizens.
And thus, the identiication of the practices of informal monetary exchanges in the
slums — as a constituency representing the urban poor — with the informality of social order is not without its deliberation to deny the well-consolidated and constituted
social structures, with their conlicts and politics, legitimacy in marginalized spaces.
The networks of informal monetary exchange abound in Govindpuri in that, indeed
to the members of the 'collective' (residents of Govindpuri), cash is readily available
outside of both state regulatory norms and structures. However, the access into these
networks, the available credit limit, the interest rates ofered and the default period
available, are determined by the borrower's social position (caste, religious, political
ailiations), credibility (the connectedness and embeddedness of the borrower in the
broader networks) and collateral (these are not 'mortgaged' but a rented tenement will
mean imposition of a higher credit interest and lower credit limit compared to someone
who owns a two-room tenement) in value. Moreover, not anyone with available and
extra cash can casually start lending it to others.
One of the factors, when inquired of the members of the community who are directly
or indirectly involved in the biyaaz ka business — creditors, investors and borrowers
— signiicant in getting the loans sanctioned and negotiating the desired interestrates, is the trust and position the interested debtor has amongst the community.
I inquired of the creditors, many of whom I have long-standing engagements with,
their ways of monetizing trust to deliberate on the amount of the loan and its interest rate. The usual manner in which trust circulates, and is accrued, in marginalized
spaces is on account of a sense of community, religious ailiations and the shared
predicaments of being slum-dwellers. Position in the community is also signiicant to
determine the negotiations between the creditor and debtor, this is not established
on account of collective ailiation and shared predicaments. Position is evaluated
on account of the duration of the individual's or family's stay in the community; their
social networks and their credit history.
Besides these considerations it is the collaterals which determine the amount of the
loan extended and the interest rates ofered. These collaterals include the validity
of the ration card, the ownership of the jhughi, the number of rooms and whether
there are spare rooms which are rented out along with an account payee cheque
written in the name of the lender. For example, an individual who owns a jhughi and
has a valid ration card to establish it will be able to raise a loan of not only a higher
amount but also on a lower interest rate, and can also negotiate not handing over
an account payee cheque.
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165
The repayment of the loan is not undertaken via bank transfers, but the demand of
the account payee cheque is to levy the extra pressure, as this tender being dishonored can lead to criminal persecution against the issuing party. Once the entire credit
amount is returned, these collaterals are returned to the borrower.
A new migrant renting a room in one of the camps in Govindpuri and desiring a
loan will not be able to raise one beyond a certain amount but will have to bear
highly exorbitant interest-rates, often touching 22% payable on a daily or weekly
basis. More often than not, the migrants cannot give an account payee cheque to
the creditor, and in this situation either the tenant in question has to present the
security of a permanent resident as a collateral or repay the calculated interest rate
on a daily basis.
However, in the last few years these collaterals, especially with the tenants and migrants (who are often the ones in need of urgent cash and can be demanded any interest rate), are not considered suicient. And thus, in the present, those seeking loans
have to deposit their ration cards and/or voter identity cards in the original. In the last
few years of following the byaaz ka business I have only twice come across instances
of default when the borrowing party has ‘left’ without paying the dues. In the irst case,
it was a young girl of 19 who eloped with her lover, and in the second instance, it was
a migrant worker from Nepal who never came back. And in both instances, the amount
was less than 5,000 INR.
The ‘trust’ in the informal networks that is accrued is then a delicately calibrated project of social, cultural and inancial histories. Whilst the creditors, depending on the
scale they operate on, have their ‘boys’ who act in the capacity of loan-sharks, the
visits are ‘gentle reminders’ and never lend to humiliating the borrowers/clients. Shakeel, a prominent creditor in Govindpuri, contextualized this approach, ‘we will get the
monies, one way or another. Everyone knows if they default or run away, they will never
really be able to ind a standing again in the community here. But we also know the
compulsions people living here work within, and belonging to the same place, it will
be just bad for the business, along with being completely merciless, to extort money
from them under duress’.
Losing ‘Trust’: In Between Visits to the Bank and Notebandi
In the third week of the demonetization drive, an afternoon was spent with the few
women from the Navjeevan camp deliberating its impact but more importantly trying to
make sense of what it – notebandi - means. ‘I really thought it was a joke’, said an old,
wizened lady. Another added, ‘what will happen to all the old notes? I never thought
about notes having a lifetime, they also die’ to be supported by the reckoning that,
‘never really thought that having loose change would make you feel rich’. Such was
the tenor of these discussions. It was in part seriously jocular, but that did not mean
the gravity of the situation was lost to any one of us.
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The discussions soon steered toward the visits to the banks2 and the act of queuing
the demonetization drive had necessitated. All the women present in the company
had bank accounts, most of them opened prior to the Jan Dhan Yojna,3 however their
visits to the banks were few and far between and mostly undertaken in the company
of others as a group. In the last few years, I have discussed at length the engagement
and experience of residents, and more speciically the women in present company,
with (and of) ‘formal banking practices’. And, more often than not, these would focus
on their visits to the bank.
From evoking anxiety, ‘bayaankar sar dard’ (splitting headache) to a sense of helplessness ‘kutch samaaj mein hi nahin aata hai’ (don’t fathom anything) and anger, ‘saale,
humse aise baat karte hain ki hum insaan hi na hon’ (they talk to us as if we are not
humans), the visit to the banks for the women from Govindpuri, even in the pre-demonetization era, was fraught with uneasiness, constantly reminding them of their position
as slum-dwellers. These women carry, and are contained within, the slumming bodies;
illiterate as they are, the lives they live on the margins are etched on their bodies with
seemingly an indelible ink. Of all the State institutions, banks4 as spaces of interactions
between the slum-dwellers and the mainstream networks evoke the most immediate
and violent sense of disenfranchisement amongst the residents of the slums. ‘We are
not valued here, the poor are not given any respect’ is one of the most-often evoked
sentiments in regard to the visit to the banks articulated by the urban poor.
The announcement of demonetization necessitated visits to the banks by some, if not
all, of these women. Most of them are beneiciaries of one of the many state-pensions,
in this situation either old-aged or widowed. However, the main reason for the visit to
the bank was not withdrawal, but to exchange the thus announced illegal tenders of
500 and 1000 either for themselves or their family members and others in their extended networks. When recounting their experiences of the visits to the bank, interlinked
as they were with the demonetization drive, what irked the women was not as much
the waiting, standing in the queues or even compromising on their daily schedules, as
much as having to seek ‘bheek’, alms, of their own money from the State. ‘Ek tho saala
paisa nahin, us par bhi jo thoda bahut hai uske ke liye bhi maara-maari’ (this money is
ours, and then we have to sufer to claim it), is the usual refrain.
2
3
4
The media coverage of the demonitization as a ‘disaster’ and its focus on the queues captured
the imagination of the masses, and allowed a common vocabulary to insert themselves into the
narrative by sharing their experiences.
Pradhan Mantri Jan-Dhan Yojana (P.M.J.D.Y), Prime Minister's People Money Scheme is India's
National Mission for Financial Inclusion to ensure access to inancial services, namely Banking
Savings & Deposit Accounts, Remittance, Credit, Insurance, Pension in an afordable manner. This
inancial inclusion campaign was launched by the Prime Minister of India Narendra Modi on 28
August 2014 (‘Prime Minister to Launch Pradhan Mantri Jan Dhan Yojana Tomorrow: To Dedicate
Mobile Banking Facility on Basic Mobile Phones to the Nation’, Press Information Bureau,
Government of India, 27 August 2014, http://pib.nic.in/newsite/erelease.aspx?relid=109113). He
had announced this scheme on his irst Independence Day speech on 15 August 2014; (‘Pradhan
Mantri Jan Dhan Yojana’, Wikipedia, https://en.wikipedia.org/wiki/Pradhan_Mantri_Jan_Dhan_
Yojana. For more information, see ‘Pradhan Mantri Jan Dhan Yojana (PMJDY)’, Pradhan Mantri Jan
Dhan Yojana, https://www.pmjdy.gov.in/scheme.
State hospitals and educational institutions are also uncomfortable spaces of interactions, but
here the sense of disenfranchisement is not so acute as in these spaces the middle-class
presence is not so pronounced.
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167
‘Being there means not being somewhere else’ is how Lela Aunty, the one with a slight
limp, spoke about waiting, here in particular reference to queuing at the banks immediately following notebandi. The manner in which 'not being there' — evoked in the sense
of routines of the everyday being disrupted — was negotiated by relying on social
networks (mostly in the immediate materiality of the lane, comprising of a few families)
to take shifts in ensuring the smooth operations of diferent chores, errands, especially
towards tending to the children.
The waiting at the banks evoked reminiscence of the days when the women from the
Navjeevan camp had to queue to fetch water, almost a decade back. In the conversations that followed parallels were drawn: from the need to collect the wares (plastic
bottles/containers and here plastic cards — Aadhar cards, Voters IDs); the anticipation
of how much could be expected depending on the spot in the queue and the ights that
happened whilst standing in the queues.
The preparations, queuing and waiting for water, as I have elaborated in my thesis,
have a sociality which cannot be singularly viewed from the lens of lacks. Here, social,
cultural and political identities and spaces were claimed and recalibrated, which had
resonances in the manner that the everyday was negotiated among the residents. In
a similar vein, the spatial-temporal ‘ruptures’ of queuing for the banks in the wake of
demonetization thus have to be situated in the context of the continuation of everyday
negotiations which those living in the margins have to negotiate with.
The deliberations of the residents of Govindpuri then compel a far more engaged, indepth understanding of how poverty is sustained (structurally, socially, politically) but
also more importantly the manner the poor articulate this predicament. A very strong
sense of one’s self was evidenced in the categorical manner in which the diference between queuing for water and banks was identiied as ‘zaroorat’ (need) and ‘haq’ (right),
respectively: ‘to stand in the queues for water was our need, compulsion, but to stand
in front of the banks to what is rightfully ours is humiliating, this is only exaggerated by
the manner in which they treat the poor’.
Cashless Bodies, Bouncing Cheques:
In the irst couple of weeks of demonetization Pooja and Akki’s business sufered signiicant cut-backs. Their regular clients, mostly men from business and middle-class
households, were equally afected by the cash crunch which brought a halt to their visits to Pooja and Akki’s. They contextualised the situation thus: ‘Earlier they could easily
account for the missing few thousands, especially to their wives, but now with each
penny being guarded over, how do they explain? They call us, and are sympathetic,
some rather worried as well, but what can even they do?’ Some of the clients ofered
to pay for their services in old currency notes of 500 and 1000, but the ofer was not
amenable to Pooja and Akki.
As soon as demonetization was announced, in the local markets it was possible to
‘change’ the old currency notes for still-legal tender of 100-rupee notes for a ‘cut’.
And thus, to change 500 currency notes for legal tender, 100 rupees was charged.
Whilst most daily-wage laborers, more often than not migrants, illiterate and not
having a bank account (or at least in any of city’s local banks), had little or no choice
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but to make do with the loss. Moreover, they could not aford to lose out on a day’s
wages to queue outside the banks to change the currencies.
Pooja and Akki’s household is run on a day-to-day basis of procuring the necessary
items, rice, lentils, vegetables and milk. Considering both have been residents of the
local neighbourhood for a few years, in the initial phase of cash-crunch they could rely
on good-will and their position here to acquire the necessary items on credit. During
this phase, I found myself spending a lot of time with the two of them, but also others in the extended networks whom I have known for a few years. Whilst the sense of
something going wrong was palpable, the gloom and doom of demonetization has still
not settled in. And most of these women were treating this slow-time in their business
as well-deserved holiday.
The gravity of the situation drew closer to home with the demonetization severely impacting the byaaz ka business, destabilizing the until then secured social and inancial
position and investments. Here, Pooja and Akki encountered the double-whammy of
not receiving the monthly interests on the money they had lent out but also in being
harassed by the loan-sharks whom they had in return borrowed from. Pooja and Akki’s
involvement (and investments) in the byaaz ka business were an astute, ingenious and
innovative negotiation between their role as ‘creditors’ and borrowers. In efect, Pooja
and Akki would raise a signiicant amount (usually up to 100,000 INR) from the ‘big
guys’, the creditors, at a negotiable interest rate of 8-10%. This money they would
then further re-introduce into the byaaz ka business by lending them out piecemeal, in
smaller amounts, for a shorter period of time on an interest rate signiicantly higher to
what they pay.
The rate, depending on the need of the borrower, time-period and collateral provided,
can be as high as 22% per month. In the last decade, Pooja and Akki managed to
signiicantly improve their inancial situation, and thus also alleviating the opportunities
available to them, by their ingenious investments in these intersecting and overlapping
credit networks.
Both have had bank accounts since the last decade, but these are rarely used to conduct inancial transactions. They do not receive payments for their services through
these accounts, and their investments are primarily in the byaaz ka business. The most
signiicant use of having a bank account in the last few years, since they have made serious investments in the byaaz ka business, for them is in issuing cheques whilst seeking loans, and in turn demanding from borrowers who can issue them as collaterals.
As mentioned earlier, the threat of criminal persecution in case of the issued cheque
being dishonoured was evoked merely as that, a threat as everyone involved knows
that the proceedings are long and tedious, and more often than not the sum is not as
signiicant to pursue it legally. It is the combined loss of valid identiication, threat of
criminal persecution but most importantly losing the ‘trust’ of the creditors that lends
these informal networks their tenacity and robustness.
With the announcement of notebandi on the night of 8 November, the sustenance of
the informal networks of monetary exchange in Govindpuri sufered a serious blow,
and this was not solely on account of the lack of circulating currencies but more sig-
CRITIQUES OF THE GRAND SCHEMES
169
niicantly on the challenging of the delicately calibrated project of ensuring ‘trust’. In
the weeks following demonetization, an announcement was made to the efect of the
government considering taking sterner actions against default and dishonouring of the
cheques issued (i.e. bouncing of cheques). These included the threat of arrest after a
month’s notice-period to the issuing party, even if the case is not yet settled.
By the second-week of demonetization, Pooja and Akki’s professional engagements
were still limited, and the task of running their household on a daily basis was posing
serious concerns. The shopkeepers were refusing credit beyond a limit, and whatever
few thousand cash they had in old currencies had been changed, even at the cost of
the change commission. The byaaz ka business was not yielding any returns. The borrowers were unable to return either the principal amount or the interest accrued, and
whilst Pooja and Akki took turns to visit them on an almost daily basis, even their hopeless situation was not lost to them to exert any undue pressure.
As Akki put it, ‘of course we would go there, and often abusive arguments would ensue, but what else to be done? They did not have the money, period. We were only so
insistent because we had the creditors breathing down our necks, but what could have
been done? We have been in this business together for so long, but never has it been
this bad. We have lost monies, trust and respect. The creditors have started sending
their ‘boys’ as regularly as we were visiting those who borrowed money from us. We
have never felt so humiliated and helpless in all these years’.
Pooja tried to raise a loan against her gold jewellery, which is another common practice
of those who can aford it in the slums, from irms operating locally. However, she was
informed that not only are the credit-interest rates as high as 24% but also that the
money will be transferred in the bank accounts and handed to them in cash. This was
not a viable option on both the accounts; the high interest rate (and the subsequent
inability to repay it and thus loss of the jewellery) but also the transfer into their bank
account did not ofer them any respite as the withdrawals were still limited to a daily
amount of only 2,500, if indeed cash was available in the banks.
Unable to manage the serious and severe inancial crisis, Akki decided to take on
an assignment for two weeks in Jaipur whilst Pooja agreed to stay back to hold the
fort in Delhi. It was thought that Akki’s visit would yield earnings up to 80,000 INR
of which they would pay half to the creditors, thus placating them until the situation
was stabilised.
On one of the days whilst Akki was away, and Pooja was not at home running some
errands, two of the ‘boys’ paid a visit to ‘yet again remind them’ about their due payments. At their house, the ‘boys’ have visited when I have been there, both before
and during demonetization. Even when Pooja and Akki’s respective partners would be
present (both of them are unemployed), it would be the women of the house who would
engage with them. These interactions even though meant to be showing of strength are
marked by friendly banter and gentle reminders of the payments due.
However, on this occasion with both Akki and Pooja absent, their payment overdue
by almost two-months and a cold, reticent welcome by the latter’s partner refusing
to give any reassurance irked the creditors. They tried to reach Akki, but she was
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unavailable, and dreading that they might have done a runner, the creditor deposited the post-dated, account payee cheque issued by Akki in his bank.
Discussion
In the immediate, everyday materiality it was not so much the lack of the money to
transact with — the loose change, so to say — which was being lamented upon, but
its impact on networks of monetary exchanges which form the lifeline of sustenance in
the slums, especially for the women with no regular jobs (steady employment). These
included the manner that the chit-fund groups would conduct their business; the investments (or the money) circulating in the informal, credit interest networks (byaaz ka
business) and how it would afect the ‘side-businesses’. The last included, but were
not limited to, taking up sowing assignments from nearby ‘import-export’ factories,
casual sex-work and such ‘beech ka kaam’, which remains an indeterminate but important form of employment and revenue generation for the women.
In that, the demons that the machinations of demonization had (and are still continually) unleashing were compelling women to not relect on new strategies to negotiate
the ‘disaster’, but instead accessing the accrued lived, experiential knowledge(s) and
strategies of living in poverty as a series of continual, concomitant disastrous events.
Once the realization and the reality that the currency notes of 500 and 1000 were no
longer legal, but to indeed actualize its worth, the residents of Govindpuri had to go
through a long, arduous and ‘humiliating’ experience, the initial ‘euphoria’ about demonetization as ‘surgical strike’ began to be treated with certain circumspection. In the
irst week of the drive, the residents’ response to it resounded the ‘popular’ sentiment:
‘of course, it is a good move, inally all the black monies in the county will be dealt with;
there will be no corruption; for the good of the Nation, we can endure some pains’.
In the initial-euphoric phase, the ‘ruptures’ the demonetization drive necessitated –
namely, being cashless and standing in the queues – did not pose a threat to the fabric
of everyday life in Govindpuri. These predicaments are not ‘new’ to the residents, and it
was reckoned ‘jo thoda bahut saheyega woh sambaal lega’, those who persevere, they
will wade through the tide.
However, the everyday, especially for those living in conditions of precarity, is not a
neatly folded negotiation between individuals, situations, structures, interruptions
and eventualities. The co-and-inter-dependence between the diferent factors/actors/
events which lend to the everyday of the poor the tenacity — often (problematically)
celebrated as ‘juggad’ — to ‘innovate, improvise and eventually overcome’ the ‘ruptures’ also operate in the same or similar realm of precarity which becomes of the poor.
The precariousness of the networks within which the poor have to negotiate their
everyday lives however should not be confused with a lack of tenacity of these networks. The tenacity of these networks (and thus the lives of the poor) is a delicately
balanced and negotiated act of ‘trust’, accrued on account of long-term, sustained
and shared experiences of poverty; a compulsion to constantly negotiate structures
of power for often basic access of resources; and a collective experiencing of marginality insidiously and extensively afected in their immediate, extended, imagined
and aspirational sites of selves which lends to further accentuating their distance
from the sites of the structures of power.
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171
Whilst it is tempting, and the general tendency is, to situate the value of trust as a
currency in the lives of those living in conditions of precarity and on the margins, an
arbitrariness outside of the realm of formal logic and reasoning, this is a deliberately
(systemically and systematically) perpetuated reckoning solely on the account that
poverty is a diicult text to read, and its committed readers few and far between.
References
‘Here's the Full Text of Modi's Speech on the Discontinuation of ₹500 and ₹1,000 Bank Notes’, Huington Post, 9 November 2016, http://www.huingtonpost.in/2016/11/08/heres-the-full-text-of-modisspeech-on-the-discontinuation-of_a_21601525/.
‘Pradhan Mantri Jan Dhan Yojana (PMJDY)’, Pradhan Mantri Jan Dhan Yojana, https://www.pmjdy.gov.
in/scheme.
‘Pradhan Mantri Jan Dhan Yojana’, Wikipedia, https://en.wikipedia.org/wiki/Pradhan_Mantri_Jan_Dhan_
Yojana.
‘Prime Minister to Launch Pradhan Mantri Jan Dhan Yojana Tomorrow: To Dedicate Mobile Banking
Facility on Basic Mobile Phones to the Nation’, Press Information Bureau, Government of India, 27
August 2014, http://pib.nic.in/newsite/erelease.aspx?relid=109113.
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FIRST AS ARTS, THEN
AS TRAGEDY — TWO
CENTS ON PERSONAL
CROWDFUNDING
AND CREATIVE
ENTREPRENEURIALISM
SILVIO LORUSSO
CRITIQUES OF THE GRAND SCHEMES
173
FIRST AS ARTS, THEN AS TRAGEDY — TWO CENTS
ON PERSONAL CROWDFUNDING AND CREATIVE
ENTREPRENEURIALISM
SILVIO LORUSSO
Crowdfund Everything
What is crowdfunding for? One could assume that, if asked such a question, most of
the people that know this word (according to a study by the Pew Research Center,
61% of Americans have never heard of it1) would refer to innovative products or services, album releases, documentaries, books, videogames, or comics. In other words,
they will be inclined to associate crowdfunding with the endeavors of tech startups and
the creative industries.
This assumption is partly conirmed by the data available on the highest funded crowdfunding projects.2 Besides the great number of cryptocurrency-related campaigns run
independently or through Ethereum in the top ten, most of the projects were hosted
by either Kickstarter or Indiegogo, both platforms generally used to inance creative or
innovative undertakings. Of course, the sheer amount of money raised lures a comparable magnitude of media attention, thus establishing a feedback loop between the aggregation of a large public through big news outlets and inancial success. This is the
case of Pebble, a smartwatch idea which collected more than 40 million dollars during
three separate Kickstarter campaigns. This massive crowdfunding achievement didn't
prevent the company from shutting down after four years of activity.
Another reason why crowdfunding is generally associated with creativity and innovation has to do with its origins. The practice of collecting monetary contributions from
internet users emerged primarily as a means of inancing artistic ventures. One of these
was the U.S. tour of the British rock band Marillion, made possible in 1997 by the
$60,000 of their fans' online donations.3 This early instance, in which online fundraising wasn't yet a streamlined process, reminds us that crowdfunding itself is an entrepreneurial idea irst implemented in the context of the arts. Thanks to crowdfunding,
what was an informal exchange with an audience was turned into a business model.
Now, two decades later, nurturing a community is considered one of the fundamental
features of crowdfunding.4
1
2
3
4
Aaron Smith, ‘Shared, Collaborative and On Demand: The New Digital Economy’, Pew Research
Center: Internet, Science & Tech, 19 May 2016, http://www.pewinternet.org/2016/05/19/the-newdigital-economy/.
‘List of Highest Funded Crowdfunding Projects.’ Wikipedia, 12 May 2017, https://en.wikipedia.
org/w/index.php?title=List_of_highest_funded_crowdfunding_projects&oldid=780102024.
Jack Preston, ‘How Marillion Pioneered Crowdfunding in Music’, Virgin Blog, 20 October 2014,
https://www.virgin.com/music/how-marillion-pioneered-crowdfunding-in-music.
Ethan Mollick, ‘The Unique Value of Crowdfunding Is Not Money — It’s Community’, Harvard
Business Review, 21 April 2016, https://hbr.org/2016/04/the-unique-value-of-crowdfunding-is-notmoney-its-community.
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The managerial impetus of these musicians adds a new layer of meaning to the notion
of creative destruction formulated by Viennese economist Joseph Schumpeter, where
a new commodity, technology, type of organization, etc. erodes preexisting economic
structures and creates new ones.5 Since the relationship with fans is part of an artist's
practice, using it to gather donations is a inancial invention where the artistic, creative
component is fundamental. Crowdfunding originates as an idea that creatively deteriorates the role and position of middlemen and evolves as an expression of creative
entrepreneurialism, where there is no clear boundary between the ‘creative’ and the
‘entrepreneurial’. More speciically, the former becomes a function of the latter and
vice-versa. As the band recounts:
We then sacked the manager. We emailed the 6000 fans on our database to ask,
‘Would you buy the album in advance?’ most replied ‘yes.’ [...] That was the crowdfunding model that has been so successfully imitated by many others including the
most successful, KickStarter.
Surprisingly, despite the artistic legacy of crowdfunding and the recurrent media coverage
of innovation, the primary destination of online contributions is neither edgy technology
nor artistic work, but personal fundraising. While 68% of U.S. donors have contributed
to campaigns launched to help a person in need, only 34% funded a new product and
30% decided to support musicians and other kind of artists.6 Furthermore, GoFundMe,
a platform focused on social and personal campaigns, surpassed the bar of $3 billion
dollar raised in 2016 while Kickstarter reached that goal only one year afterwards.7
GoFundMe is not the only platform mainly devoted to personal crowdfunding. There is
also YouCaring, GiveForward, and even Indiegogo has its own parallel charity crowdfunding platform called Generosity. Does their core business make them diferent from,
say, Kickstarter? Do they incarnate a fundraising logic diferent from the one of crowdfunding sites focused on art and invention? In other words, is there a fundamental
diference between asking money for a medical emergency and an Internet of Things
gadget? In the following sections I describe a series of campaigns that reveal the way
in which personal crowdfunding encourages, and to some extent requires, creative
entrepreneurialism. The reason why I am speciically interested in the campaigns initiated by these ‘entrepreneurs of the self’ is that while undergoing the dynamics of
crowdfunding, they expand its scope in diferent ways.
The Unpaid Intern as Media Company
Nowadays, internships represent one of the few viable paths to initiate a career in the
most diverse professional sectors. The internship, which is originally meant to be a
learning experience, is therefore reframed as an opportunity to eventually land a job.
5
6
7
Joseph Schumpeter, Capitalism, Socialism and Democracy, London and New York, NY: Routledge,
2013, pp. 83, 84.
Aaron Smith, ‘Shared, Collaborative and On Demand’.
Ingrid Lunden, ‘Gofundme Passes $3b Raised on Its Platform, Adding $1b in Only the Last 5
Months’, TechCrunch, 18 October 2016, https://techcrunch.com/2016/10/18/gofundme-raises3b-on-its-platform-raising-1b-in-only-the-last-5-months/. Justin Kazmark, ‘$3 Billion Pledged
to Independent Creators on Kickstarter.’ Kickstarter Blog, 26 April 2017, https://www.kickstarter.
com/blog/3-billion-pledged-to-independent-creators-on-kickstarter.
CRITIQUES OF THE GRAND SCHEMES
175
Because of high demand, companies and institutions — even well-established ones —
can easily ofer internships that are paid little money or not paid at all. In other words,
the internship is understood as a required investment to enter the labor market. It isn't
hard to appreciate the way in which these unpaid internships contribute to exacerbate
class advantage, since only the individuals who have enough inancial stamina are able
to aford this point of access to professional life.8
Fig. 1. Unpaid internship campaigns on GoFundMe.
What about all the others? They need to come up with creative solutions. Crowdfunding is one of those. At the time of writing, a search for ‘unpaid internship’ on GoFundMe generates almost ive hundred results, while the campaigns generically related to
internships are more than ten thousand. These campaigns feature young graduates
smiling at the camera, passionately describing their interests and academic achievements while detailing their speciic inancial needs. The descriptions, which luctuate
between very elaborate pitches and extremely concise blurbs, are characterized by a
mongrel literary genre in which the diary, the résumé and the business plan converge.
This new literature already has its own manuals, like a GoFundMe guide for a successful education-related campaign.9
Fig. 2. Still from Clement Nocos’ video pitch.
8
9
Cfr. Precarious Workers Brigade, Training for Exploitation?, London/Leipzig/Los Angeles: Journal
of Aesthetics and Protest, 2017, pp. 12-3; Ross Perlin, Intern Nation: How to Earn Nothing and
Learn Little in the Brave New Economy, London: Verso, 2014.
‘How to Run a Successful GoFundMe Campaign for College Expenses.’ GoFundMe Tutorials,
https://pages.gofundme.com/fundraiser-success-tips/college-fundraising-tips/.
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The story of Clement Nocos is at the same time an exemplary case of crowdfunding
an unpaid internship and an exceptional one. In 2016, Nocos, a Master of Public Policy
graduate and activist from Canada, got accepted for a prestigious internship at the
United Nations, a ‘one-time-only’ opportunity, as he somehow ironically deines it.10
There was only one drawback: the internship was unpaid, a decisive problem given the
steep cost of living in a city like New York.
For his campaign, Nocos chose Generosity, Indiegogo's side-platform ‘for human
goodness’, because of the absence of an expiry date, the possibility of adding ‘perks’
and the regular disbursement of funds. In order to gather attention, he produced a
four-minute-long videoclip explaining why people should donate to his campaign. To
make the video efective, Nocos, a political scientist, crafted his message with the aim
of entertaining his audience: he included some photoshopped images of himself and
a few ironic intermezzos accompanied by an old school hip-hop soundtrack. Furthermore, Nocos took advantage of some promotional strategies, such as asking only half
of the money he needed or ofering a United Nations mug (‘not for sale!’) to particularly
generous donors. The campaign's description resembles the FAQ section of a website,
including such questions as ‘Why should I help you?’ and ‘What do you need?’ At the
bottom of the page, Nocos ofers a breakdown of his expenses (250$ per month are for
food). His eforts included a ‘crafty social media campaign’, deemed almost indispensable by the platform which constantly insists on sharing public updates.
Fig. 3. Detail from Nocos' video pitch.
In a post on Medium, Nocos explains the reasons and the results of his campaign in
detail.11 As he puts it,
it seems like getting on the internship grind was the only way to get that work experience that has apparently become necessary for securing at least precarious,
entry-level employment.
10
11
Clement Nocos’ crowdfunding campaign on Indiegogo’s Generosity, https://www.generosity.com/
education-fundraising/clem-s-united-nations-internship-blog-podcast/.
Clement Nocos, ‘The Crowdfunding Grind: Why It’s Not Paying for an Unpaid Internship’, Medium,
1 August 2016, https://medium.com/@amaturhistorian/the-crowdfunding-grind-why-its-notpaying-for-an-unpaid-internship-96a3d82c0d22#.j3vs4pw2j.
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He describes crowdfunding as his only viable choice for inancing the internship,
while still having to deal with student debt (‘Why Crowdfunding? What else do I
got?’). In preparation of his campaign, Nocos realized that he wasn't the only one
trying to inance his internship through crowdfunding, and this is why he ‘felt the
need to diferentiate’. So, he started a blog and a podcast about the grinds of internship at the United Nations (12 episodes to date). Out of the $6,000 he aimed
to raise, he was able to gather less than $2,000 over a year. Relecting back on
his experience, Nocos, who was skeptical of crowdfunding in the irst place, could
only conirm his original feelings. He speaks of social media fatigue, he mentions
the uneasiness of having to ask money to a circle of friends who are often going
through a tough situation, and he concludes that ‘the crowdfunding market has literally crowded itself out when it comes to people asking for money to replace labour
income for their unpaid internships.’
Despite the meager loot he gained, Nocos’ eforts produced an additional result. It
didn’t take long before self-promotion turned into a critique addressing the very issue of unpaid internships. In his podcast ‘The Internship Grind’, he discussed the Fair
Internship Initiative, the book Intern Nation by Ross Perlin, and he interviewed Nathalie Berger and David Leo Hyde, currently shooting An Unpaid Act, a documentary
on unpaid internships and precarity. Nonetheless, looking back at this activity, Nocos
humbly acknowledges the ambivalence of ‘selishly’ lobbying for a personal cause and
addressing a structural condition:
But to be frank, the podcast isn’t all just about documenting this kind of crappy
quirk of the modern labour market. It was intentionally self-serving, in a way, to
draw attention to my own crowdfunding campaign and make it more visible for
potential donors.
What role did Nocos play in his own campaign? As he was aware that crowdfunding success is strictly related to the user's ability to operate as a media company,
he acted simultaneously as a copywriter, a video-maker, a social media manager,
and an accountant.
Call to Action Meets Activism
On personal crowdfunding platforms, it is not uncommon to read about a broken arm,
a heart transplant, or a rare disease. In these cases the campaign goals range from a
few thousand dollars to more than half a million. $60,000 was the amount asked by Kati
McFarland, a 25 year-old photographer from Arkansas sufering from Ehlers-Danlos
Syndrome, a genetic disorder causing many diferent complications like fainting, fatigue and stomach paralysis. She sums up her condition by saying that she ‘can barely
walk /stand / eat w/o severe pain/ dislocations / vomiting / blackout’.12
12
Kati McFarland’s campaign on YouCaring: https://www.youcaring.com/kati-mcfarland-588646.
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Fig. 4. Detail from the image gallery on McFarland's campaign.
After her father suddenly passed away, McFarland found herself alone struggling to
manage her medical expenses that exceed by far the beneits provided by the State.
This is why she started a fundraiser on YouCaring, a platform that unlike GoFundMe
doesn't take any fee on the donations.13 McFarland's campaign doesn't look as carefully crafted as Nocos’ one. She doesn't have a video on her page, only a few images
showing her while being under medical treatments and some screenshots of the related costs. The irst part of the description follows the usual script of personal storytelling while the second part is an extremely detailed cost breakdown illed with medical
technicalities. Given the short attention spans internet users have grown accustomed
to, it isn't hard to understand why it took her more than 7,000 re-blogs and shares to
reach a preliminary goal of 1,200 dollars.
Fig. 5. Detail from the interface of Generosity.
Things changed for McFarland when she attended a talk by congressman Tom Cotton, an ardent opponent of Obamacare, the healthcare act that the new Trump administration is trying to repeal. During the event, she took the loor and explained to
the congressman that without the coverage provided by the Afordable Care Act she
13
YouCaring and Generosity don’t charge any fee. However, a 2.9% is deducted by credit card
processors like Paypal, We Pay, or Stripe: ‘Free Fundraising’, YouCaring, https://www.youcaring.
com/c/free-fundraising.
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would lose her life (‘I will die. That is not hyperbole.’). McFarland asked him whether
he would commit not only to the repeal of the act, but also to building a proper substitute. This is when the audience exploded in a big round of applause. After Cotton
tried to skirt the issue, the crowd vocally expressed its disapproval by repeatedly
shouting ‘do your job’.14
After being published on the internet, Kati McFarland’s intervention gained some degree of virality. Then, she started to see her fundraiser grow at a surprisingly increased
rate. In the meantime, McFarland had been invited to talk about what happened on
several TV news programs, where she asserted the need to give a face to the collective
demand for accessible healthcare. However, this efort wasn’t disconnected from the
promotion of the campaign, a matter of life and death for her:
there are many things I wish I could have said [...] but unfortunately I just had to focus on shoehorning in the link to this fundraiser (probably to Don Lemon’s chagrin),
but you gotta do what you gotta do when medical bills are involved.15
Of course, the media attention that McFarland got thanks to her intervention had a
positive efect on the donations to her campaign. But at the same time, her story became symbolic of all the patients endangered by ill-advised policy making. In a similar
way to Nocos, Kati McFarland had to deal with the highly ambiguous space where personal promotion goes hand in hand with the attempt to shed light on a structural deicit.
First as Arts, Then as Tragedy
Around 2007 a meme started to circulate on the internet. It was the picture of a kid on
a beach holding a ist full of sand, with an expression of pride on his face. The picture
became known as ‘Success Kid’ and it is still used nowadays to either express frustration or describe situations in which one is ‘winning’.16 In 2015, Sam Griner, the boy
impersonating the ‘Success Kid’ meme, now 8 years old, availed himself of his online
popularity to fund the transplant of his father’s kidney. A campaign was launched on
GofundMe including only one family picture with Sam in the middle and a concise
account of the calamity. The campaign raised more than $100,000, thanks to which
the transplant was eventually possible. Signiicantly, on The Verge, the news was published under the category of entertainment.17
Despite its happy ending, this vicissitude can be read as a cautionary tale about the
role played by social and news media attention when it comes to personal crowdfunding. Here, a series of more or less arbitrary criteria increase the chances of a
campaign's success, although without guaranteeing it. After all, there is still no such
thing as a science of virality. Such vagueness is conirmed by the overly generic tips
14
15
16
17
Adi Cohen, ‘Donations Pour In For Woman Who Yelled At Her Senator’, Vocativ, 23 February 2017,
http://www.vocativ.com/405313/donations-woman-yelled-senator-town-hall/.
McFarland, ibid.
‘Success Kid / I Hate Sandcastles’, Know Your Meme, http://knowyourmeme.com/memes/
success-kid-i-hate-sandcastles.
Amar Toor, ‘The Internet Just Helped ‘Success Kid’ Raise Money for His Dad’s Kidney Transplant’,
The Verge, 17 April 2015, https://www.theverge.com/2015/4/17/8439483/success-kid-fatherkidney-transplant-crowdfunding.
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ofered by GoFundMe itself: ‘avoid blurry pictures [...] Write a catchy and descriptive
title. Which title sounds better? ‘I Need Money!’ or ‘Julie’s Rally Against Cancer’... the
second one, right?’18 A title needs to be ‘catchy’ in order to stand out from the plethora
of running campaigns. In this scenario, the access to an informal means of protection
against emergencies turns into a race where online media literacy is a valuable competitive advantage.
Fig. 6. Message from a donor to the ‘Success Kid’’s father.
As writer Alana Massey points out, crowdfunding for medical care represents the most
radical transformation of fundraising since the 80s. At that time, another crucial shift
was taking place: charities were converting their model into an individual-based sponsorship. Instead of being asked to ‘sponsor children in need’, donors would be now
invited to ‘sponsor a child in need’.19 The singularization of solidarity which is also
embedded in crowdfunding sites is often understood as a positive feature, because it
ofers ‘the opportunity to help one speciic person and help change one person’s life’.20
Furthermore, the individual-based relationship between the donor and the beneiciary
is reinforced by the direct contact between them ofered by crowdfunding platforms.
Considering the telegraphic style of several campaigns, one could assume that many
of those are only meant to address family members and friends who are already aware
of the issue at stake. In this case, crowdfunding ofers a convenient interface that facilitates the coordination of fundraising. But frequently the hope is to reach a crowd of
strangers and therefore compete for their attention. A crowd whose choices are likely
relective of several biases.21 Among them, there is one that sounds particularly gloomy
‘GoFundMe Guide: Six Steps to a Successful Campaign.’ GoFundMe Help Center, http://support.
gofundme.com/hc/en-us/articles/203604494-GoFundMe-Guide-Six-Steps-to-a-SuccessfulCampaign.
19 Alana Massey, ‘Mercy Markets’, Real Life, 11 April 2017, http://reallifemag.com/mercy-markets/.
20 Amanda Mikelberg, ‘Gofundme Is a Tuition Money Machine in New York City’, Metro, 15 February
2017, http://www.metro.us/new-york/gofundme-is-a-tuition-money-machine-in-new-york-city/
zsJqbo---bbddbvpGbRm6.
21 A 2016 study shows that Kickstarter crowdfunding projects including photos of black subjects
have a signiicantly lower success rate. Cfr. Lauren Rhue and Jessica Clark. ‘Who Gets Started on
Kickstarter? Racial Disparities in Crowdfunding Success’, SSRN Scholarly Paper, Rochester, NY:
Social Science Research Network, 9 September 2016, https://papers.ssrn.com/abstract=2837042.
18
CRITIQUES OF THE GRAND SCHEMES
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when associated with personal crowdfunding: survivorship bias, the habit of focusing
on successful past experiences while ignoring the others.22 As writer Anne Helen Petersen puts it, ‘crowdfunding is fantastic at addressing need — but only certain types,
and for certain people.’23
Crowdfunding success is bolstered by online media dexterity. Journalist Luke O'Neil
emphasizes this aspect: ‘I often joke lately that I used to think I've wasted my life on
Twitter, but it might actually come in handy when I inevitably need to crowdfund an operation. You have to hustle. You have to market. You have to build your brand.’ O’Neil
also draws a direct parallel between medical crowdfunding and the ecosystem of tech
entrepreneurship. He sarcastically associates the presentation of GoFundMe users’
medical history to the stereotypical narrative of startups, implicitly revealing a similarity
between an appeal to charitable spirits and a pitch to a venture capital irm: ‘Think of
your cancer as the origin story a tech startup tells about itself on the About section of
its website’, he suggests.24
Emerging from O’Neil’s remarks is the alleged content neutrality of crowdfunding, no
matter whether it is employed to inance the ‘Coolest Cooler’ or used as a means to
alleviate the hardships looming throughout the whole spectrum of a lifetime.25 The way
in which Indiegogo introduces Generosity reveals the way in which crowdfunding is
generalized by a mere extension of its target group:
We started Indiegogo in 2008 with a simple idea: Give people the power and
resources to bring their ideas to life. Over the years we’ve watched in delight
as inventors, musicians, storytellers, and activists pushed the boundaries of our
original vision. [...] Inspired by the seemingly boundless compassion and creative
spirit of our users, we challenged ourselves to do more — this time for the very
people and causes that often need help the most. The ones that fall through the
cracks. The ones that need a second chance. The ones on the brink. Generosity helps cancer patients with bills and students with tuition. Generosity boosts
humanitarian eforts into new countries and helps nonproits move quickly with
their causes. Generosity ills the gap at the end of a tough month and supports
the village after the storm.26
In other words, crowdfunding repeats itself, irst as arts, then as tragedy. But while
doing so, it preserves the promotional language and entrepreneurial dynamics that
characterize fundraising for art or innovation: things like ‘perks’, enforced social
media bombardment, strategies borrowed from advertising, and, as Ian Bogost
22 In 2014, I created Kickended.com, an archive of Kickstarter’s $0-pledged campaigns, to be able
to navigate and bring attention to campaigns unable to raise any money, thus opposing the
survivorship bias embedded in both news media and the interfaces of crowdfunding platforms.
23 Anne Helen Petersen, ‘The Real Peril of Crowdfunding Health Care’, BuzzFeed, 10 March 2017,
https://www.buzzfeed.com/annehelenpetersen/real-peril-of-crowdfunding-healthcare.
24 Luke O’Neil, ‘Go Viral or Die Trying.’ Esquire, 28 March 2017, http://www.esquire.com/newspolitics/a54132/go-viral-or-die-trying/.
25 The ‘Coolest Cooler’ is a cooler equipped with a blender and speakers that raised more than 13
million dollars on Kickstarter.
26 Generosity's mission statement: https://www.generosity.com/.
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maintains, a semblance of the reality show.27 All of these aspects, critically addressed by artist and activist Josh MacPhee, survive in campaigns about survival:
Our goal — our imperative — is to harden ourselves and our projects into cohesive,
likable, and salable commodities. We wake up as brands, joyously exulting in these
lattened, logo-like versions of ourselves. Clean and eicient with soft, smooth corners and antiseptic Helvetica expressions. What is not to love about these new forms,
so sleek and attractive on the outside, with the promise of aiding us in the fulillment
of the last remaining human right in our society: the right to be an entrepreneur?28
Sadtrepreneurs
During the MyCreativity Sweatshop event, American novelist Bruce Sterling gave a
talk entitled ‘Whatever Happens to Musicians, Happens to Everybody’. He portrayed
musicians as ‘patient zero in the critical injury clinic of the creative sweatshop’. Sterling
referred to them as an avant-garde of the precarity experienced by creative workers.
He also relected on crowdfunding as a means to sustain their practice, concluding
that wouldn't be a good idea since ‘the crowd lacks imagination’.29 According to Brett
Neilson and Ned Rossiter, the creative worker is considered by many the precarious
subject par excellence.30 Now that creative solutions are becoming a crucial means of
addressing various forms of precariousness, we might read Sterling’s portrait of musicians as canaries in the coal mine as an alarmingly vivid prediction. The people running
campaigns on sites like GoFundMe can be seen as creative workers whose very medium is their own adversities, carrying out a practice sustained by an entrepreneurial
attitude that includes management and promotion.
The Web is full of labels referring to speciic types of entrepreneurs. Online, we read of
kidtrepreneurs, solopreneurs, or even botrepreneurs. Looking at these campaigns, it
seems that the more precariousness is present, the less entrepreneurialism becomes
voluntary.31 So, we might introduce yet another blend-word to identify the users of
personal crowdfunding sites. Many of those are ‘sadtrepreneurs’, subjects that unwillingly, or at least ambivalently, behave as entrepreneurs. To them, the creativity needed
to run a successful campaign is not a liberating force, but a strategic necessity linked
to subsistence or even survival.
Far from being uniquely the result of one’s own passion, entrepreneurially performed
‘creative’ undertakings are increasingly becoming an obligation. More and more people reluctantly join the ranks of a novel kind of creative underclass whose very medium
27 Ian Bogost, ‘Kickstarter: Crowdfunding Platform Or Reality Show?’, Fast Company, 18 July 2012,
https://www.fastcompany.com/1843007/kickstarter-crowdfunding-platform-or-reality-show.
28 Josh MacPhee. ‘Who’s the Shop Steward on Your Kickstarter?’, The Baler, 4 March 2014,
https://thebaler.com/salvos/whos-the-shop-steward-on-your-kickstarter.
29 Bruce Sterling, ‘Whatever Happens to Musicians, Happens to Everybody’, MyCreativity
Sweatshop, Amsterdam, 20 November 2014, https://vimeo.com/114217888.
30 Brett Nielson and Ned Rossiter, ‘From Precarity to Precariousness and Back Again: Labour, Life
and Unstable Networks’, Fibreculture 5 (2005), http://ive.ibreculturejournal.org/fcj-022-fromprecarity-to-precariousness-and-back-again-labour-life-and-unstable-networks/.
31 I call ‘entreprecariat’ the mutual relationship between entrepreneurialism and precarity. Cfr.
Silvio Lorusso, ‘What Is the Entreprecariat?’, The Entreprecariat, 27 November 2016, http://
networkcultures.org/entreprecariat/what-is-the-entreprecariat/.
CRITIQUES OF THE GRAND SCHEMES
183
is constituted by its members’ personal necessities. Is there a possibility to combine
compulsory creative entrepreneurialism with genuine expressions of discomfort? Is
it possible to do PR through precarity and against precarization? In this grim scenario, the stories of Clement Nocos and Kati McFarland relect the urge to divert attention solely from individual miseries to the broader structural conditions causing them.
Would this efort be worth a monumental crowdfunding campaign?
References
Bogost, Ian. ‘Kickstarter: Crowdfunding Platform Or Reality Show?’, Fast Company, 18 July 2012,
https://www.fastcompany.com/1843007/kickstarter-crowdfunding-platform-or-reality-show.
Cohen, Adi. ‘Donations Pour In For Woman Who Yelled At Her Senator’, Vocativ, 23 February 2017,
http://www.vocativ.com/405313/donations-woman-yelled-senator-town-hall/.
‘Free Fundraising’, YouCaring, https://www.youcaring.com/c/free-fundraising.
‘GoFundMe Guide: Six Steps to a Successful Campaign’, GoFundMe Help Center, http://support.gofundme.com/hc/en-us/articles/203604494-GoFundMe-Guide-Six-Steps-to-a-Successful-Campaign.
‘How to Run a Successful GoFundMe Campaign for College Expenses’, GoFundMe Tutorials. https://
pages.gofundme.com/fundraiser-success-tips/college-fundraising-tips/.
Kazmark, Justin. ‘$3 Billion Pledged to Independent Creators on Kickstarter’, Kickstarter Blog, 26 April
2017, https://www.kickstarter.com/blog/3-billion-pledged-to-independent-creators-on-kickstarter.
‘List of Highest Funded Crowdfunding Projects’, Wikipedia, 12 May 2017. https://en.wikipedia.org/w/
index.php?title=List_of_highest_funded_crowdfunding_projects&oldid=780102024.
Lorusso, Silvio. ‘What Is the Entreprecariat?’, The Entreprecariat, 27 November 2016, http://networkcultures.org/entreprecariat/what-is-the-entreprecariat/.
Lunden, Ingrid. ‘Gofundme Passes $3b Raised on Its Platform, Adding $1b in Only the Last 5 Months’,
TechCrunch, 18 October 2016, https://techcrunch.com/2016/10/18/gofundme-raises-3b-on-itsplatform-raising-1b-in-only-the-last-5-months/.
MacPhee, Josh. ‘Who’s the Shop Steward on Your Kickstarter?’ The Baler, 4 March 2014, https://
thebaler.com/salvos/whos-the-shop-steward-on-your-kickstarter.
Massey, Alana. ‘Mercy Markets’, Real Life, 11 April 2017, http://reallifemag.com/mercy-markets/.
Mikelberg, Amanda. ‘Gofundme Is a Tuition Money Machine in New York City’, Metro, 15 February
2017, http://www.metro.us/new-york/gofundme-is-a-tuition-money-machine-in-new-york-city/
zsJqbo---bbddbvpGbRm6.
Mollick, Ethan. ‘The Unique Value of Crowdfunding Is Not Money — It’s Community’, Harvard Business
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Review, April 21, 2016. https://hbr.org/2016/04/the-unique-value-of-crowdfunding-is-not-money-itscommunity.
Nielson, Brett and Ned Rossiter, ‘From Precarity to Precariousness and Back Again: Labour, Life and
Unstable Networks’, Fibreculture, no. 5 (2005), http://ive.ibreculturejournal.org/fcj-022-from-precarity-to-precariousness-and-back-again-labour-life-and-unstable-networks/.
Nocos, Clement. ‘The Crowdfunding Grind: Why It’s Not Paying for an Unpaid Internship’, Medium, 1
August 2016. https://medium.com/@amaturhistorian/the-crowdfunding-grind-why-its-not-payingfor-an-unpaid-internship-96a3d82c0d22#.j3vs4pw2j.
O’Neil, Luke. ‘Go Viral or Die Trying’, Esquire, 28 March 2017, http://www.esquire.com/news-politics/
a54132/go-viral-or-die-trying/.
Perlin, Ross. Intern Nation: How to Earn Nothing and Learn Little in the Brave New Economy, London:
Verso, 2014.
Petersen, Anne Helen. ‘The Real Peril of Crowdfunding Health Care’, BuzzFeed, 10 March 2017,
https://www.buzzfeed.com/annehelenpetersen/real-peril-of-crowdfunding-healthcare.
Precarious Workers Brigade, Training for Exploitation?, London/Leipzig/Los Angeles: Journal of Aesthetics and Protest, 2017.
Preston, Jack. ‘How Marillion Pioneered Crowdfunding in Music’, Virgin Blog, 20 October 2014, https://
www.virgin.com/music/how-marillion-pioneered-crowdfunding-in-music.
Rhue, Lauren and Jessica Clark. ‘Who Gets Started on Kickstarter? Racial Disparities in Crowdfunding
Success’, SSRN Scholarly Paper. Rochester, NY: Social Science Research Network, 9 September
2016, https://papers.ssrn.com/abstract=2837042.
Schumpeter, Joseph. Capitalism, Socialism and Democracy, London and New York, NY: Routledge,
2013.
Smith, Aaron. ‘Shared, Collaborative and On Demand: The New Digital Economy’, Pew Research
Center: Internet, Science & Tech, 19 May 2016, http://www.pewinternet.org/2016/05/19/the-newdigital-economy/.
‘Success Kid / I Hate Sandcastles’, Know Your Meme, http://knowyourmeme.com/memes/success-kidi-hate-sandcastles.
Sterling, Bruce. ‘Whatever Happens to Musicians, Happens to Everybody’, MyCreativity Sweatshop,
Amsterdam, 20 November 2014, https://vimeo.com/114217888.
Toor, Amar. ‘The Internet Just Helped ‘Success Kid’ Raise Money for His Dad’s Kidney Transplant’, The
Verge, 17 April 2015, https://www.theverge.com/2015/4/17/8439483/success-kid-father-kidneytransplant-crowdfunding.
CRITIQUES OF THE GRAND SCHEMES
THE DATA PARADOX:
HOW THE WAR ON
POVERTY BECAME A
WAR ON THE POOR
NATHALIE MARÉCHAL
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THE DATA PARADOX: HOW THE WAR ON POVERTY
BECAME A WAR ON THE POOR
NATHALIE MARÉCHAL
This essay is adapted in part from Nathalie Maréchal, ‘First They Came for the Poor:
Surveillance of Welfare Recipients as an Uncontested Practice’, Media and Communication 3.3 (20 October 2015).
Introduction
One of the main functions of government is to provide certain beneits (cash, goods,
or services) to the people who need them. We call this ‘the welfare state’. Some needs
are universal (clean running water, national security) while others only apply to certain
categories of people (only children go to public schools; only homeowners get homeowner tax credits). The state collects data on people in order to know what categories
they fall in, and consequently what kinds of beneits they should receive. At times it
may collect additional data to learn how well a program is working and how it might be
improved. Ideally, the point of this surveillance is to direct resources to the right places
to maximize human wellbeing and minimize waste. Unfortunately, it doesn’t always
work that way. The system of poverty relief (‘welfare’) in the United States exempliies
how surveillance systems can reinforce social structures of oppression by measuring
what elites care about (welfare fraud) and ignoring the things that common sense and
human decency might emphasize (alleviating poverty).
The Surveillance Society
We are now living in a pervasive surveillance society, and most of us either don’t know it
or don’t care. There are at least three interlinked yet distinct ‘surveillant assemblages’:
the remnants of the welfare state, the national security state, and surveillance capitalism. While some people are uncomfortable with any data being collected about them
at all, others argue that some degree of surveillance is necessary for governments and
businesses to function. States need to know how many children live in a given city to
ensure there are enough teachers, and law enforcement agencies have a legitimate
interest in (for example) lawfully wiretapping suspected criminals in order to prosecute
them. Meanwhile, businesses can often provide better service when they know who
their customers are, what they want, and how much they are willing to pay for it.
There are a lot of good reasons to resent and resist surveillance. One of those reasons
is that surveillance systems are designed with particular goals in mind that aren’t necessarily clear to the people being surveilled, that they may not share, and that may not
be to their beneit. Once the system is in place it takes on a life of its own, ruthlessly
replicating its own logic even if that logic deies common sense. In this essay, I use
the example of poverty relief programs in the United States, also known as ‘welfare’,
to show how a mass surveillance system built on faulty premises — key among them,
the notion that preventing fraud is more important than ending poverty — actually perpetuates poverty and prevents itself from learning how to end it. Even as the system
relentlessly seeks out every scrap of information about the poor to verify their deserv-
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ingness, it deliberately fails to provide data that would help administer programs more
efectively. This is a stunning paradox: a system whose guiding principle is the collection of information yields virtually no data that could meaningfully inform public policy.
What I Mean by ‘Surveillance’
By surveillance, I mean the routinized collection of data and monitoring of populations
in their daily lives and routines through the use of networked databases — what Roger
Clarke calls ‘dataveillance’.1 Many individual data collection events — a web search,
a car rental, a ingerprint — are fairly trivial on their own. When people say they have
‘nothing to hide’, what they often mean is that they can’t imagine the mundane data
points of their daily lives being interesting to someone else. And that’s often true of
individual data points taken in isolation. They acquire their value when billions of them
are combined in vast networked databases. Data sitting quietly in vast repositories
isn’t the main issue either. It’s what people do with the data that matters. Big data analytics, data science and data mining all refer to the complex operations of discovery
that allow surveillant organizations to piece together disparate pieces of information
in order to generate insight and act on it. That action can take many forms: to grant a
government beneit, to order a drone strike against a suspected terrorist target, or to
display a ‘more relevant’ piece of advertising.
Government surveillance conducted for law enforcement, intelligence or national security
reasons has gotten a lot of attention since Edward Snowden’s 2013 revelations about
US government surveillance of the internet. As the Snowden documents showed, this
surveillance often piggybacks on corporate data collection through covert programs like
PRISM, overt law enforcement requests for user information, and brazen demands for
access to certain travelers’ social media accounts. Unconstitutional government programs should be resisted on their own merits, yet it is important to remember that government agencies’ appetite for unlimited data access is enabled by the private sector.
Indeed, the past quarter-century has seen the emergence and growth of surveillance
capitalism, ‘a deeply intentional and highly consequential new logic of accumulation’
built on ‘big data’, which ‘aims to predict and modify human behavior as a means to
produce revenue and market control’.2 Google was among the irst major companies
to monetize internet users’ data, and before long, advertising became the default business model for new technology companies.3 Surveillance capitalism has consequences for social institutions, and even for democracy itself. Claims of voter manipulation
perpetrated by private and/or foreign interests during the 2016 ‘Brexit’ vote and US
presidential election via social media platforms have spurred renewed interest in the
power of internet giants like Facebook, Google and Twitter.
The third type of routinized mass surveillance involves government agencies outside of
the national security sphere, notably the ones tasked with providing social welfare —
what I call ‘governance surveillance’. At its best, governance surveillance aims to be
1
2
3
Roger A. Clarke, ‘Information Technology and Dataveillance’, Communications of the ACM 31
(1988): 498–511.
Shoshana Zubof, ‘Big Other: Surveillance Capitalism and the Prospects of an Information
Civilization’, Journal of Information Technology 30 (2015): 75–89.
Zubof, ‘Big Other’, p. 77.
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responsive to the needs of the population, and public servants put safeguards in place
to protect citizens from privacy violations and human rights harms. Population registries and identiication systems in both rich and developing countries are the cornerstone of this ‘surveillant assemblage’. Beyond that, the types of data that is collected
and the uses of that data are highly context-speciic. Some countries consider certain
types of information too dangerous to be collected at all. For example, after population
registries containing information about religious ailiation were used to murder over
6 million Jews during World War II, a number of European countries banned the collection of data about religion, race or ethnicity. This raises challenges for monitoring
various kinds of disparities between ethnic groups, and is powerless to prevent many
forms of discrimination, but the experience of the Holocaust taught many Europeans
that the risks of collecting this data outweighed the potential beneits.
As societies become more connected, it becomes more and more rare for people to
take even mundane actions without leaving a digital trace of that activity. Most of this
activity is recorded in some database, somewhere. The ‘digital exhaust’ produced by
the everyday activities of millions of internet users is mined by internet companies,
whose databases are in turn targeted by national governments eager to use this data
for their own purposes, using both legal and extralegal means.4 Companies outside of
the internet sector are also amassing data on users, customers, and other humans,
and leveraging this data for inancial proit. The data brokerage system is so complex
and so opaque, it is impossible to know for certain what the cybernetic machine of the
surveillance society knows about any of us.5
Together, the parallel logics of governance surveillance, national security surveillance,
and surveillance capitalism point to a near-future where all human activity is recorded
and monitored, and where people are sorted into categories based on what the databases know about them. People then receive diferential treatment based on their
assigned categories, such as extra screening at airports, public subsidies, and targeted advertising. This is what French philosopher Gilles Deleuze called the ‘control
society’,6 and what Kevin Haggerty and Richard Ericson7 call the ‘surveillant assemblage’: an ‘only partially coordinated coming together of many and varied contemporary practices and processes that record, monitor, locate, track, observe and, yes,
identify individuals so that they can be proiled and their personal data can be mined
for further analysis’.8
In this context, the use of the term ‘surveillance’ isn’t necessarily a moral judgment.
The word can have positive, negative, or neutral connotations depending on the context. For example, public health surveillance (as understood by epidemiologists, for
instance) is decidedly beneicial, while wiretapping leaders of an opposition political
4
5
6
7
8
Glenn Greenwald, No Place to Hide: Edward Snowden, the NSA, and the US Surveillance State,
New York, NY: Henry Holt and Co, 2014.
Norbert Wiener, The Human Use of Human Beings: Cybernetics and Society, New York, N.Y: Da
Capo Press, 1988.
Gilles Deleuze, ‘Postscript on the Societies of Control’, October (Winter 1992): 3–7.
Richard V. Ericson and Kevin D. Haggerty (eds), The New Politics of Surveillance and Visibility,
Toronto: University of Toronto Press, 2006.
David Lyon, Identifying Citizens: ID Cards as Surveillance, Cambridge, UK and Malden, MA: Polity,
2009, p. 55.
CRITIQUES OF THE GRAND SCHEMES
189
party is more negative. A surveillance camera in a parking garage can be used for
good (preventing or solving crimes) or for bad (surreptitiously recording the comings
and goings of one’s spouse). Indeed, many kinds of surveillance and ‘dataveillance’
are requirements for modern societies to function. In many cases the phrase ‘monitoring and evaluation’ is an accurate stand-in for ‘surveillance’. The people who run both
public and private programs or projects use data to check whether they are meeting
their goals, or to look for ways to make programs more eicient. Few people would
disagree with this strategy in principle. The problem emerges when people in positions
of power decide to measure the things that are important to them — and nothing else.
The American social welfare system provides a poignant — if dispiriting — example of
what happens when a system measures what elites care about (in this case, welfare
fraud) and ignores the things that common sense and human decency might emphasize (in this case, alleviating poverty).
Surveilling the Poor: The US Welfare State
It’s important to understand that the history of US social welfare diverges from the history of comparable programs in other rich countries. While European countries began
providing state-run and tax-funded social safety nets and labor protections starting
in the late 19th century, in the US the prevailing view of the elites was that assistance to the needy would only encourage idleness and other undesirable behavior,
and that social Darwinism would ensure that only the individuals with the best work
ethic and moral character would prosper and reproduce. Franklin Delanoe Roosevelt’s
New Deal, in the wake of the Great Depression, represented a departure from the
past through programs such as the Works Progress Administration, later renamed the
Works Projects Administration (WPA), which created employment through great work
projects; Social Security, a retirement program for old age and the disabled; and many
other poverty-relief programs collectively referred to as ‘welfare’.9
In addition to Social Security, intended to care for those relatively few (compared to
today) individuals who made it to old age, New Deal welfare programs were designed
to replace the earnings of an absent, deceased or otherwise incapacitated father igure, thereby allowing mothers to continue in their roles as homemakers and primary
caregivers for their children. It is important to note that women of color were largely
excluded from receiving beneits through both structural and individual-level racism on
the part of program administrators.10
Decades later, Lyndon Johnson’s Great Society, which included both the War on Poverty and civil rights legislation, went a long way toward easing the structural barriers preventing poor blacks from receiving aid as well as institutionalizing the welfare
system. The welfare assistance program was further expanded in the 60s as part of
Lyndon Johnson’s Great Society initiative, intended to eradicate poverty and correct
structural racial injustice. The War on Poverty was thus intertwined with government
eforts to enact the demands of the civil rights movement. By the end of the Johnson
Administration, the US appeared to be on its way to easing, if not eradicating, poverty.11
9
10
11
Brendon O’Connor, A Political History of the American Welfare System: When Ideas Have
Consequences, Lanham, Md: Rowman & Littleield, 2003.
Ibid.
Ibid.
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However, as black Americans fought to access welfare programs,12 public perception
of the average welfare recipient shifted from the virtuous white widow heroically raising
her children alone to the lazy, promiscuous, deviant (and wholly imaginary) black ‘welfare queen’ mythologized by Ronald Reagan.13 In the context of the Republican Party’s
Nixon-era Southern Strategy, conservative attacks on poverty relief programs are to be
understood as part of the ideology of white supremacy.
The 70s, 80s and early 90s saw two broad social changes that would prove crucial to
the welfare system: changes to the family structure and demographic composition of
welfare rolls, and technological advances in information management.14 Divorce and
single parenthood became more prevalent, some of the structural barriers preventing
poor people of color from accessing aid were dismantled, and the availability of birth
control made single motherhood seem more and more like a choice, and less like an
unavoidable tragedy. As a result, the American public (and legislators) became less
willing to provide support to the poor, and especially to poor, black, single mothers
who were increasingly stigmatized as lazy, promiscuous and undeserving. The ‘welfare
queen’ rhetoric espoused by Reagan and others also contributed to increased prejudice and stigmatization of poor Americans.15
At the same time, networked databases made it possible to classify and surveil large
populations, and to do so across administrative boundaries of city, county and state
human services oices. The combination of increased motivation to reduce welfare
spending and increased technical ability to monitor welfare recipients could only lead
to increased surveillance. In the run-up to the 1996 election, Bill Clinton made a deal
with the Gingrich Republicans to ‘end welfare as we know it’. The War on Poverty gave
way to a war on the poor.
The 1996 welfare reform bill, formally (and tellingly) titled the Personal Responsibility and
Work Opportunity Reconciliation Act (PRWORA), was more concerned with sending a
message to the poor (especially women of color) about personal morality than about
designing evidence-based interventions to provide Americans with a basic minimum
standard of living, much less durably lifting families out of poverty. As Brendon O’Connor
notes, ‘the preamble to the PRWORA openly describes it as being principally concerned
with overcoming the problems caused by out-of-wedlock births and welfare dependency.
Further, the act claims that its purpose is to strengthen marriage, personal responsibility,
and the work ethic’.16 Actually reducing poverty is nowhere on the agenda; the guiding
principle is not meeting the basic needs of poor Americans, but fraud prevention.17
The Clinton welfare reform was based on the premise that nearly all parents should
work outside the home to support their children, even if the wages they could com-
12
13
14
15
16
17
Frances Fox Piven and Richard A. Cloward. Poor People's Movements: Why they Succeed, How
they Fail. Vintage, 1979.
Ibid.
John Gilliom, Overseers of the Poor: Surveillance, Resistance, and the Limits of Privacy, Chicago:
University of Chicago Press, 2001.
Kaaryn S. Gustafson, Cheating Welfare: Public Assistance and the Criminalization of Poverty, New
York, NY: New York University Press, 2011.
O’Connor, A Political History of the American Welfare System.
Gustafson, Cheating Welfare.
CRITIQUES OF THE GRAND SCHEMES
191
mand in the labor market were less than the cost of childcare. By the 90s, women’s
participation in the workforce was already well-entrenched, and that the idea that
welfare ought to provide an income to poor, husbandless mothers, so that they might
stay at home raising their children, was no longer acceptable to the American public.
For many, the diiculties of raising children alone while working outside the home
were simply the natural consequence of the ‘irresponsible choice’ to have children
without a husband’s practical and inancial support. As we will see, restricting poor
women’s options with respect to their sexual and reproductive lives — arguably the
most personal, private realms of human existence — is a feature, not a bug, of the
American welfare system.
As a result, the welfare system’s priority isn’t relieving poverty, but making sure that no
one who could be working receives public assistance — regardless of whether they are
in school or caring for small children. The system prioritizes short-term self-suiciency
over giving people the tools to lift themselves out of poverty in the long run. Beneit levels are woefully inadequate,18 and families must resort to alternative sources of income
to make ends meet. The result is both endemic fraud and widespread underutilization
of beneits to which individuals and families are legally entitled.19
The 1996 Act set time limits on how long individuals could receive beneits, imposed
work requirements, and drastically tightened eligibility rules. The federally-run Assistance for Families with Dependent Children (AFDC) was replaced by Temporary Assistance for Needy Families (TANF), which is implemented by the states. Under PRWORA
the states are given clear incentives from the federal government to get as many of
their welfare population working as possible. States are also free to impose even tighter eligibility rules and shorter time limits than those envisioned by the PRWORA.20
The Act also empowered state governments to delve into women’s personal and
sexual lives by requiring single mothers to identify the biological fathers of their ofspring and by capping TANF payments to families, meaning that ‘recipients do not
receive any further money if they have more children while on the TANF program’.
These ‘family size caps’ are meant to dissuade women from having additional children while on welfare by barring newly born children from being included in beneit
calculations. The implication is that the only ‘legitimate’ children are those born to
a married mother and father, and that, by deinition, the child of a mother on welfare
18
Any good faith discussion of welfare fraud must begin by acknowledging the inadequacy of
beneits. To use California as an example, as of 2011, the minimum basic standard of adequate
care, as determined by the federal government, for a family of three was $1,135 per month. The
Maximum Income for Initial Eligibility for a Family of Three was $1,224, meaning that families
earning more than that amount are ineligible for aid. Families needed to already be signiicantly
below the poverty line before they could even apply for aid. The asset limit was $2,000 ($3,000
for households including an elderly person), plus one automobile per licensed driver — requiring
families to have sold of virtually all their assets. The Maximum Monthly Beneit for a Family of
Three with No Income was $638 (non-exempt) or $714 (exempt) — slightly more than half of what
the government considers necessary for survival. By contrast, the MIT Living Wage Calculator
project estimates that such a family needs $54,764 per year, or $4,564 per month, to make ends
meet in California. See Amy K. Glasmeier and Eric Schulteis. ‘Poverty in America: Living Wage
Calculator (California)’, MIT, 2015, http://livingwage.mit.edu/states/06.
19 Gustafson, Cheating Welfare.
20 O’Connor, A Political History of the American Welfare System.
192
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is not ‘legitimate’. During the PRWORA negotiations, ‘much of the debate cast ‘illegitimacy’ as America’s most pressing social problem, and quickly blamed ‘welfare’
as its root cause’.21
While the Act’s authors preferred co-parents to be married to each other, in the absence
of marriage they were determined to more strictly enforce child support requirements.
The implementation of a national computer tracking system made it easier to locate
non-resident parents across state lines and garnish their wages. Mothers who can’t or
won’t identify their children’s biological father risk losing their TANF eligibility. Money
recouped from so-called ‘dead-beat dads’ goes not to the children or their mother,
but to the state as a reimbursement for the cost of support that the father should have
been providing in the irst place, with the exception of a $50 pass-through. Mothers
thus have every economic incentive to resist identifying their children’s father.22
States also ‘have the discretion to deny beneits to unmarried teenage mothers’, ‘can
mandate teenage mothers attend school’, and ‘require unwed minors to live with a parent or guardian’ to receive aid23 — regardless of whether that is in the best interest of the
young mother or her child. Meanwhile, ‘the act required the federal government to spend
$50 million per year on a new abstinence education program in American schools’24 and
provided ‘inancial rewards to states that reduce the number of out-of-wedlock births
as long as there is not a corresponding increase in the number of abortions performed
in that state’.25 Yet for all the emphasis on preventing child-bearing by unmarried poor
women, PRWORA did nothing to promote use or afordability of methods of birth control other than sexual abstinence. The real problem that PRWORA sought to eradicate
wasn’t child poverty or even fatherlessness, but sexual activity by poor women (and
especially poor women of color) outside the bounds of holy matrimony.
The Data That isn’t Collected
Welfare oices at every level of government spend exorbitant sums cross-referencing
databases, following up on tips from welfare fraud hotlines, drug-testing, physically
surveilling, and legally prosecuting the poor, ostensibly to save the taxpayer money by
cutting of welfare frauds and cheaters. Yet there is next to no efort to measure how
good these welfare programs are at actually relieving poverty.
The decentralized structure of welfare administration since 1996 makes it all but impossible to come by nationally comparable datasets on the welfare population or beneit levels (or how much fraud prevention and eligibility enforcement costs). Because
welfare programs are administered by the states on a county-by-county basis, the federal government has little to no authority to oversee or critically assess the adequacy of
beneit levels, bureaucratic processes, or the return on investment in terms of assuring
a decent quality of life for the poorest among us, much less helping people durably lift
themselves out of poverty. For example, the statistics maintained by the Department of
Health and Human Services (HHS) measure expenditures and the number of beneicia-
21
22
23.
24.
25
Ibid.
Ibid.
Ibid., p. 230.
Ibid., p. 231.
Ibid.
CRITIQUES OF THE GRAND SCHEMES
193
ries; no efort is made to account for how well welfare programs meet recipients’ basic
needs, or how well the programs are administered. In fact, states measure the success
of their welfare programs by the number of needy Americans they can remove from the
welfare rolls, regardless of what happens to these families afterward. Many simply lose
eligibility and stop receiving aid.
The oicial statistics on welfare and poverty measure the wrong things in the wrong
way, thereby creating non-factual ‘knowledge’ that hides genuine problems (hunger,
poverty) while surfacing imaginary ones (illegitimacy, drug abuse, fraud, etc.). Rather
than measuring the prevalence of poverty and its human costs, federal statistics focus
on the administration of the programs. For example, the Tenth TANF Annual Report to
Congress noted that in 2011, the Federal poverty threshold for a family of four (two
adults plus two children) was $22,811, that 21.9% of children were living in poverty
that year (16.1 million), and that the child poverty rate in 2011 was 5.7 percentage
points higher than in 2000. However, the report does not mention whether TANF (or
other welfare programs) was successful in reducing the number of American children
(much less adults) living in poverty, or the percentage of need that is met. Even the
report’s authors seem to be aware of the limitations of their data, noting that only a
minority of poor families actually received the aid to which they were entitled:
Participation of Eligible Families
While many see TANF’s caseload decline as a measure of the success of welfare reform, the sharp decline in participation among eligible families also raises concerns
about its efectiveness as a safety net program. HHS uses an Urban Institute model
to estimate the percentage of families eligible for assistance under state rules that
are actually receiving TANF assistance.
As shown in Figure 2-E, and Appendix Table 2:3, this participation rate data shows
that the share of eligible families receiving TANF declined from 84 percent in 1995
to 32 percent in 2009.26
From these igures, it should be possible to compare beneits awarded against the
need they are intended to ameliorate, yet this is not done. The closest that the report
comes is Figure 9B, ‘Income Poverty Gap for All Families with Children 1997−2011’.
The poverty gap refers to the amount of money that would be required to raise all poor
families to the poverty line. However, the igures are only provided with respect to families with children — demonstrating a lack of concern for adults living in poverty — and
are not broken down by state or by any other category. The igures convey the fact that
in 2011, it would have cost $76.5 billion to raise all American children out of poverty, but
stops short of providing any information that would help achieve this.
The example of federal statistics concerning TANF illustrates the broader reality that
assessments of welfare programs emphasize inputs such as expenditures, ignoring pro-
26 ‘Temporary Assistance for Needy Families Program (TANF): Tenth Report to Congress’, US
Department of Health and Human Services, 12 December 2013, http://www.acf.hhs.gov/
programs/ofa/resource/tenth-report-to-congress.
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gram outputs and other measures of human wellbeing. From a public administration
perspective this makes sense: the Department of Health and Human Services is legally
mandated to collect and report these statistics. The question remains why it does not
also provide measures of human wellbeing. Moreover, the fact that a practice is legally
mandated provides an explanation for why it exists, but does not constitute a moral or
ethical justiication. As with many other situations (legal protections for whistleblowers
come to mind), the United States and post-modern societies more broadly lack a mechanism for reconciling the gap between what is legal and what is ethically or morally just.
The information that is most crucially lacking in the current data lows concerning welfare fall under three categories: the extent of need, how much of that need is met by the
social safety net, and cost/beneit analyses of fraud prevention. The fact that so many
members of the wealthiest society in human history are needy is reprehensible, and
welfare programs ought to be evaluated by their success in meeting that need. Granular
datasets and tables that examine these two types of measures by state, county, and
various demographic dimensions would shed light on outcome disparities between different groups, thus allowing for targeted remedies. Finally, the efectiveness of fraudprevention schemes should be methodically assessed. Schemes that cost more than the
amount saved should be eliminated, and the funding reinvested into beneit payments.
For example, in 2009 the California State Auditor found that ‘the measurable savings
resulting from early fraud detection activities exceed the costs of such eforts for CalWORKs and approach cost neutrality for the food stamp program’.27 By this logic, then,
early fraud detection was a valuable investment for CalWORKS, but not for food stamps.
More state and local level auditors and Inspectors General should pursue this kind of
analysis and pressure the agencies that administer welfare programs to do the same.
Conclusion
This brief case study on the American welfare system has demonstrated how a cybernetic surveillance system can perpetuate existing social inequality by measuring the
wrong things in the wrong way, thereby creating non-factual ‘knowledge’ that hides
genuine problems (hunger, poverty) while surfacing imaginary ones (illegitimacy, drug
abuse, fraud, etc.).
Surveillance of welfare recipients is overwhelmingly concerned with the sexual and
reproductive lives of poor women, as relected by practices such as bed checks,
family size caps, and home visits designed to catch women living with an unrelated
male. Additionally, poor women — and increasingly, working class women — are
denied access to birth control, then shamed and punished for becoming pregnant.
As abortion care becomes increasingly restricted, the message sent to poor women
is a simple choice: marriage or abstinence. Meanwhile, poor men are largely excluded from receiving aid since most welfare programs are designed to support
children (and by association their caregivers, albeit begrudgingly). The main mechanism through which poor men are expected to interact with the welfare system is
through child support collections.
27 Elain M. Howle, ‘Department of Social Services: For the CalWORKs and Food Stamp Programs,
It Lacks Assessments of Cost-Efectiveness and Misses Opportunities to Improve Counties’
Antifraud Eforts’, California State Auditor, November 2009, https://www.bsa.ca.gov/pdfs/
reports/2009-101.pdf.
CRITIQUES OF THE GRAND SCHEMES
195
Paradoxically, the reality is that welfare fraud is indeed endemic (both because beneits
are inadequate and because compliance with the Kafkaesque welfare rules is nearly
impossible), but so is underutilization of beneits to which individuals and families are
legally entitled.28 The guiding principle of the welfare system, and of the Temporary
Aid to Needy Families (TANF) program in particular, is not ensuring that people’s basic
needs are met but preventing fraud through labyrinthine means tests and reporting
requirements.29 States measure the success of their welfare programs by the number
of needy Americans they can remove from the welfare rolls, regardless of what happens to these families afterward. A large body of social science research suggests that
the guiding logic of the US welfare system is not the actual wellbeing of poor families,
but punishing the poor for being poor and setting them up as cautionary examples to
discourage others from being poor as well.30
American welfare policy is plagued by the inaccurate beliefs that many Americans hold
about people who receive public assistance. Popular opposition to welfare is deeply
rooted in the historical legacy of racism.31 Indeed, opposition to the social safety net is
connected to the (inaccurate) belief that welfare recipients are overwhelmingly black.32
In turn, correcting these misperceptions is hindered by the information and data lows
concerning welfare and its beneiciaries. Even as the system relentlessly seeks out every scrap of information about the poor to verify their deservingness, it deliberately fails
to provide systemic data that would help administer programs more efectively. This is
a stunning paradox: a system whose guiding principle is the collection of information
yields virtually no data that could meaningfully inform public policy.
The administration of welfare in the United States is a vicious cycle that must be broken.
Only when the state, and the bureaucrats who comprise it, start measuring success by
human impact factors rather than economic measures of thrift will meaningful policy
change be possible. In light of the political situation in the US, civil society should lead
the way by producing these datasets to the extent possible, perhaps by focusing on a
speciic state or local jurisdiction, then confronting relevant public sector actors about
the relative inadequacy of their own data. Legislative and regulatory changes will be
necessary as well. Once county, state, and federal agencies start evaluating welfare
28 Gustafson, Cheating Welfare.
29 Ibid.
30 Elizabeth Bussiere, (Dis)entitling the Poor: The Warren Court, Welfare Rights, and the American
Political Tradition, University Park, PA: Pennsylvania State University Press, 1997; Virginia
Eubanks, Digital Dead End: Fighting for Social Justice in the Information Age. Cambridge, MA
and London: MIT Press, 2012; John Gilliom, Overseers of the Poor: Surveillance, Resistance, and
the Limits of Privacy, Chicago: University of Chicago Press, 2001; Gustafson, Cheating Welfare;
O’Connor, A Political History of the American Welfare System; Piven and Cloward, Regulating the
Poor; Karen Seccombe, ‘So You Think I Drive a Cadillac?’ Welfare Recipients’ Perspectives on
the System and Its Reform, 3rd edition, Boston, MA: Allyn & Bacon, 2011; Joe Soss, Unwanted
Claims: The Politics of Participation in the US Welfare System, Ann Arbor: University of Michigan
Press, 2002.
31. Linda Gordon, Pitied but Not Entitled: Single Mothers and the History of Welfare, Cambridge, MA:
Harvard University Press, 1994; Jill Quadagno, The Color of Welfare: How Racism Undermined the
War on Poverty, Oxford: Oxford University Press, 1994.
32. Martin Gilens, Why Americans Hate Welfare: Race, Media, and the Politics of Antipoverty Policy,
Chicago, IL: University of Chicago Press, 1999.
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programs not on the basis of how little they cost and how few people receive support,
but according to human needs being met and families becoming economically selfsuicient in the long term, we can start building a cybernetic surveillance machine that
can perpetuate a virtuous cycle of data collection, action, and adjustment.
References
Bussiere, Elizabeth. (Dis)entitling the Poor: The Warren Court, Welfare Rights, and the American Political Tradition, University Park, Pa: Pennsylvania State University Press, 1997.
Clarke, Roger A. ‘Information Technology and Dataveillance’, Communications of the ACM 31 (1988),
498–511.
Deleuze, Gilles. ‘Postscript on the Societies of Control’, October (Winter 1992), 3–7.
Ericson, Richard V. and Kevin D. Haggerty (eds), The New Politics of Surveillance and Visibility, Toronto:
University of Toronto Press, 2006.
Eubanks, Virginia. Digital Dead End: Fighting for Social Justice in the Information Age. Cambridge, MA;
London: MIT Press, 2012.
Gilens, Martin. Why Americans Hate Welfare: Race, Media, and the Politics of Antipoverty Policy, Chicago, IL: University of Chicago Press, 1999.
Gilliom, John. Overseers of the Poor: Surveillance, Resistance, and the Limits of Privacy, Chicago:
University of Chicago Press, 2001.
Glasmeier, Amy K., and Eric Schulteis. ‘Poverty in America: Living Wage Calculator (California)’, MIT,
2015, http://livingwage.mit.edu/states/06.
Gordon, Linda. Pitied but Not Entitled: Single Mothers and the History of Welfare, Cambridge, MA:
Harvard University Press, 1994.
Greenwald, Glenn. No Place to Hide: Edward Snowden, the NSA, and the US Surveillance State, New
York, NY: Henry Holt and Co, 2014.
Gustafson, Kaaryn S. Cheating Welfare: Public Assistance and the Criminalization of Poverty, New York,
NY: New York University Press, 2011.
Howle, Elain M. ‘Department of Social Services: For the CalWORKs and Food Stamp Programs, It
Lacks Assessments of Cost-Efectiveness and Misses Opportunities to Improve Counties’ Antifraud
Eforts’, California State Auditor, November 2009, https://www.bsa.ca.gov/pdfs/reports/2009-101.
pdf.
Lyon, David. Identifying Citizens: ID Cards as Surveillance, Cambridge, UK and Malden, MA: Polity,
2009, p. 55.
O’Connor, Brendon. A Political History of the American Welfare System: When Ideas Have Consequences, Lanham, Md: Rowman & Littleield, 2003.
Quadagno, Jill. The Color of Welfare: How Racism Undermined the War on Poverty, Oxford: Oxford
University Press, 1994.
Piven, Frances Fox, and Richard A. Cloward. Poor People's Movements: Why they Succeed, How they
Fail. Vintage, 1979.
Seccombe, Karen. ‘So You Think I Drive a Cadillac?’ Welfare Recipients’ Perspectives on the System
and Its Reform, 3rd edition, Boston, MA: Allyn & Bacon, 2011.
Soss, Joe. Unwanted Claims: The Politics of Participation in the US Welfare System, Ann Arbor: University of Michigan Press, 2002.
‘Temporary Assistance for Needy Families Program (TANF): Tenth Report to Congress’, US Department
of Health and Human Services, 12 December 2013, http://www.acf.hhs.gov/programs/ofa/resource/
tenth-report-to-congress.
Wiener, Norbert. The Human Use of Human Beings: Cybernetics and Society, New York, N.Y: Da Capo
Press, 1988.
Zubof, Shoshana. ‘Big Other: Surveillance Capitalism and the Prospects of an Information Civilization’,
Journal of Information Technology 30 (2015), 75–89.
ALTERNATIVES IN FINANCIAL IMAGINATION
HOW TO COOP THE
DIGITAL ECONOMY
TREBOR SCHOLZ
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HOW TO COOP THE DIGITAL ECONOMY
TREBOR SCHOLZ
Over the past few years, investor-funded internet irms have continued to push unabated into market sectors such as food delivery, home health care, house cleaning, and data entry, ofering customers much-appreciated, immediate convenience.
Just take the geo-location-driven ride-ordering capabilities that Uber’s app ofers,
with all its fare splitting between friends and automatic carpooling. These technological features are a meaningful improvement over the low-tech cab riding that
was brought to you by way of hand waves, phone calls, and whistles. The potential beneits for an Uber driver are also clear: she can work when she wants, and
it is easy for her to be reached via the app. The company subjects drivers to the
same ive-star rating system as customers, potentially shielding them from abuse.
Fares and fees are charged automatically, avoiding the need for awkward exchanges of loose change. For one thing, Uber’s model is reasonably beneicial, providing
the opportunity to earn a supplemental income for people in between jobs and others in need of immediate and somewhat lexible work. For another, there is now a
subgenre of books, news articles, blog essays, and research papers that have provided ample evidence of the harm caused by the extractive platform economy.1
The list of wrongs is long. It includes meager pay, predatory market practices, unlawful
operations such as gray balling,2 and a misogynistic work culture (think: #susanfowler).
There have been lawsuits by workers demanding their reclassiication from independent contractors to full-ledged employees, as well as the strikes of thousands of Uber
and Ola drivers in India. In Capetown, South Africa, Uber drivers sued the company,
and are likely to set up a cooperatively owned platform.3 With the notable exception
of a handful of cities and a ruling by the EU court, municipalities and governments
have been eager to embrace the extractive platform economy.4 Though Austin, Texas
stood its ground against Uber and Lyft, and Barcelona has repeatedly ined Airbnb
while crafting policy in favor of a more just sharing economy, these eforts still have to
develop into coordinated global dissent.
The Economy is not Working for Most People
Why do we need platform coops? A discussion about platform capitalism that only
considers platforms is as inadequate as a narrow study of the mechanics of the assembly line meant to explain Fordism. The platform economy is inseparable from the
condition of labor and the market failures and broader challenges of capitalism that
platform coops challenge.
1
2
3
4
https://platform.coop/resources/tags/platform-capitalism.
‘Gray balling’ is based on Uber’s algorithmic blacklisting of municipal policy makers.
The Platform Cooperativism Consortium is supporting the eforts of local activists and a union to
form a platform coop.
‘Collaborative Economy’, European Commission on Growth, 22 May 2017, http://ec.europa.eu/
growth/single-market/services/collaborative-economy_en.
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Income inequality. Unsurprisingly, the sharing economy emerged against the background of deliberate shockwaves of austerity that followed the global inlation of
the 70s, the explosion of public debt in the 80s, and the 2008 inancial crash.
Income inequality has continued to grow as capital gains have outpaced those
of labor.5 In 2015, sixty-two people controlled the combined wealth of 3.5 billion
people.6 Women are overrepresented in the bottom half of the economy in most
countries. In addition, the lowest paid workers dominate the service sector, bringing about a neo-feudal servant culture. In 2014 in the United States, the median
adjusted income for households headed by blacks was $43,300, and for whites it
was $71,300.7
Platform monopolies and the monetization of surveillance. The Web has hit rock
bottom; the concentration of power and surveillance are at odds with how Tim
Berners-Lee had envisioned the World Wide Web in 1989. The concerning power
of platform companies enabled through network efects, and data concentration
weakens competition and creates vast power asymmetries. Why should a small
number of owners and investors be the main benefactors of the riches of the Web?
And this question not only concerns those who are toiling in the digital economy
to make a living but it also applies to the users of Google, Facebook, Twitter, or
Microsoft who don’t have control over the very platforms that organize their lives.
Workers and internet users toil under conditions they do not choose, for CEOs they
cannot ouster.
A lack of digital workplace democracy. Democracy is at the core of the rhetoric of
Silicon Valley, and yet it is a far cry from being a reality on the Net. While the project
of political democracy made inroads in many countries in the 20th century, the idea of
workplace democracy has skipped the digital workplace. In fact, insofar as workers
on app-mediated factory loors fall outside of the National Labor Relations Board’s
deinition of ‘employees’, workers in the sharing economy have lost the ability to
unionize and collectively bargain — a step backward from the democratic gains of
the labor movement.8
Stalled rights. Those working on digital labor brokerages like TaskRabbit pay brokerage fees of 30% on each transaction, yet as independent contractors they do not beneit from workers comp, unemployment beneits, health insurance, or minimum wage
protections under the Fair Labor Standards Act.9
5
6
7
8
9
Trebor Scholz, ‘Platform Cooperativism vs. the Sharing Economy’, Medium, 5 December 2014,
https://medium.com/@trebors/platform-cooperativism-vs-the-sharing-economy-2ea737f1b5ad.
Oxfam, ‘62 People Own Same as Half World’, Oxfam, http://www.oxfam.org.uk/media-centre/
press-releases/206/01/62-people-own-same-as-half-world-says-oxfam-inequality-report-davosworld-economic-forum.
‘On Views of Race and Inequality, Blacks and Whites Are Worlds Apart’, Pew Research Center, 27
June 2016, http://www.pewsocialtrends.org/2016/06/27/on-views-of-race-and-inequality-blacksand-whites-are-worlds-apart/.
Chris Opfer, ‘Gig Worker Organizers Still Looking for Road Map’, Bloomberg BNA, 26 May 2017,
https://www.bna.com/gig-worker-organizers-n73014451571/.
Taskrabbit, ‘What is the TaskRabbit Service Fee?’, TaskRabbit, https://support.taskrabbit.com/hc/
en-us/articles/204411610-What-is-the-TaskRabbit-Service-Fee-.
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Stagnating wages. Over the last forty years, real wages of most American workers
have stagnated and there is a growing sense that capitalism is not good for most
people. The expansion of demands by the #FightFor15 campaign, which began
with a focus on fast-food workers and expanded to a push for a more than 100%
increase in the federal minimum wage, is evidence that the rate of seven dollars
and twenty-ive cents an hour, instituted in 1991, is not viable. Models of digitallymediated work which evade even this meager existing protection further exacerbate the problem.
Systemic racism. Consumers have found themselves equally in the wild, with AfricanAmerican Airbnb guests expressing their frustrations on Twitter through the hashtag
#AirbnbWhileBlack.10 One study found that booking requests by African-American users are 16% less likely to be accepted than their white counterparts.11 Another study
showed that the problem of catching a cab as a person of color persists on ride-hailing
platforms, with increased acceptance times on Lyft and twice as many canceled rides
on Uber for users with ‘African-American sounding’ names.12
The myth of choice. ‘Flexible workers’ not only include Uber drivers but also baristas,
crowd workers, fast-food cooks, models, and adjunct professors. Workers in the platform economy can decide when to work but the choice of which fourteen-hours in a
day to work, and on which low-paying, platform is little choice at all.
Shift away from direct employment. Over the past decades in the United States, labor
markets have increasingly shifted to the internet. In 2016, an estimated ifty-ive million
Americans were freelancers, representing a steady shift away from direct employment
toward an economy dominated by independent contractors. In the same year, 24%
of Americans reported earning money from the digital platform economy, which is increasingly dominated by the Big Five.13
Invisible labor. ‘486,679 loors made lawless in Manhattan’, the ad by a cleaning service platform boasts in the New York City subway. The cleaning professionals who
power the app are not mentioned — your apartment will simply be clean after a swipe
on your on your mobile phone. Law professor Marion Crain emphasizes that, ‘invisibility has physical efects on workers and their bodies. If workers are symbolically
invisible, then no one sees their health conditions.’14
10
11
12
13
14
Maggie Penman and Shankar Vedantam, ‘#AirbnbWhileBlack: How Hidden Bias Shapes The
Sharing Economy’, NPR, 26 April 2016; learn more about racial discrimination at Airbnb in
Benjamin Edelman and Michael Luca, ‘Digital Discrimination: The Case of Airbnb.com’, Harvard
Business School Working Paper 14.054 (January 2014).
Benjamin Edelman, Michael Luca, and Dan Svirsky, ‘Racial Discrimination in the Sharing
Economy: Evidence from a Field Experiment’, American Economic Journal: Applied Economics,
2016, http://www.benedelman.org/publications/airbnb-guest-discrimination-2016-09-16.pdf.
Eric Newcomer, ‘Study Finds Racial Discrimination by Uber and Lyft Drivers’, Bloomberg, 31
October 2016, https://www.bloomberg.com/news/articles/2016-10-31/study-inds-racialdiscrimination-by-uber-and-lyft-drivers.
Aaron Smith, ‘Gig Work, Online Selling and Home Sharing’, Pew Research Center, 17 November
2016, http://www.pewinternet.org/2016/11/17/gig-work-online-selling-and-home-sharing/.
Marion G. Crain, Winifred Poster, and Miriam A. Cherry, Invisible labor: Hidden Work in the
Contemporary World, Oakland, CA: University of California Press, 2016, p. 284.
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Risks are shifted onto workers. Airbnb is the largest hotelier and yet, it owns no hotels;
Uber is the largest taxi company and owns no cars. Drivers for Uber do not ‘share’
their cars with passengers: it is the assets these workers own which are rented out
through these irms. The costs of ixed-capital depreciation have been outsourced
onto the workers. Sharing economy irms have been running on your car, apartment,
labor, and importantly, time. Uber and Airbnb are logistics companies where all participants pay up the middleman.
Rights for the disabled. Americans with disabilities have also been victimized by the
platform economy. As it scaled up, Uber maintained that, as a technology company,
the onus of fulilling the requirements of the Americans with Disabilities Act lay squarely
on its contracted workforce. Lawsuits in California, Texas, Arizona, and Illinois have led
to the creation of services like UberASSIST, but the number of accessible vehicles on
the road is nowhere near those required of licensed taxi companies.15 Using the slogan
‘Nothing About Us Without Us!’, disabled people ight back.
Market appropriation of social reciprocity. Social practices that were once outside of
the realm of market transactions have become subject to capital. Canadian technologist Tom Slee observes that ‘the sharing economy is extending a harsh and deregulated free market into previously protected areas of our lives’.16 The sharing economy
could be a boon to the communities and individuals who constitute it, but extractive
speculation has led to outcomes quite diferent than those originally proposed by the
likes of BlaBlaCar and Couchsuring.
The smokescreen of counterculture. The gig economy is morphing into a dangerous
fantasy; the television show Silicon Valley is frightfully accurate in its satire. By now,
only few people still fall for the sharing theater of the extractive platform economy and
its deceptive ‘peer’ rhetoric. Sharing economy monopolies promote their companies as
a #woke friend, with their CEOs delivering a ‘we are all connected’ voiceover, ending
with mystifying references to environmental sustainability or Occupy Wall Street. Their
community managers highjack the values and social capital not only of open source
and peer-to-peer projects but also the cooperative movement. The language of innovation is equal part of this linguistic obfuscation. How is a irm innovative when its main
focus is the creation of short-term beneits for shareholders? We need to downplay this
kind of innovation and instead promote a focus on broader, long-term impact, actual
needs, and a people-centered economy.
All too often it seems that all of these challenges — from inequality to exploitation —
point to an inevitable future of work in which inequality has signiicantly sharpened,
and the digital economy is in the hand of just four or ive players. In his book Average is Over, the conservative economist Tyler Cowen introduces us to one possible
endgame for this trend. Soon, he predicts, there will be a superclass of 10 to 15% of
the population that will make over $1 million per year. For the bottom 85%, he envi-
15
16
There have been new developments like the ‘Toronto model’, where Uber has essentially been
mandated by the city to subsidize rides for the disabled, but they are far and few between.
Tom Slee, What’s Yours Is Mine: Against the Sharing Economy, New York City: OR Books, 2015, p.
11.
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sions an annual income along the lines of $5,000–10,00017 In Cowen’s vision, there’s
nothing that we can do to avert a future in which a tiny ‘hyper-meritocracy’ of Americans enjoy fantastically interesting lives while the rest slog along, tranquilized by free
internet and low-paying gigs.
But the future of work is by no means uncontested. As this economy is not working for
most people, the need for alternative economic models is as pressing as it is apparent.
It is time for cooperatives to speak truth to platform capitalists. They can re-envision
the internet–mediated economy as something that can work for the beneit of all its
stakeholders, not just shareholders.
Humane Alternatives to the Winner-Takes-All Economy
Platform cooperativism is about economics by other means. It is a nascent but
growing political and economical movement that builds a fairer future of work by
joining the values of the cooperative movement with internet technologies — apps,
platforms, and protocols. Building on the successes of the free software movement, coop members, technologists, unionists, and freelancers create a concrete
near-future alternative to the extractive sharing economy that is rooted in democratic ownership.
By decentralizing the power of apps, protocols, or websites, platform coops allow
low and volatile income households to beneit from the shift of labor markets to the
internet. Steering clear of the belief in one-click ixes of social problems, the model is
poised to vitalize genuine innovation by joining the rich heritage and values of coops
with emerging internet technologies.
Platform cooperatives are owned and governed by those who depend on them most
— workers, users, and other relevant stakeholders. In their most common form, platform cooperatives are operated through websites or mobile apps that facilitate the
sale of goods or services, not unlike other businesses in the platform economy. Platform coops are based on values of pluralistic, egalitarian ownership and worker selfgovernance, seeking to create a digniied and sustainable digital economy. By returning control of platforms to those whose lives and livelihoods they impact, platform
coops make good on the democratizing aspirations of the early internet.
Platform Coops Build on an Economic Model that Works — It’s Hidden Around Us in
Plain Sight
Platform coops build on the cooperative business model. Coops ofer a clear and
successful alternative to the extractive economy, with a history that dates back to the
Society of Equitable Pioneers, a consumer cooperative of weavers founded in Rochdale in 1844. Today, coops understand the need for businesses to be responsive to
all their stakeholders, which include not only the men and women who work for them
but also the consumers who depend on them and the communities in which they
live. Coops aim to be sustainable, proving by example that alternatives to predatory
markets are feasible.
17
Tyler Cowen, Average Is Over: Powering America Beyond the Age of the Great Stagnation, New
York: E P Dutton & Co, 2013.
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In the U.S. to date, coops have created close to one million jobs with $25 billion in
wages and beneits. One in three Americans is a coop member.18 233 million Americans
are served by coop owned and ailiated insurance companies.19 Worldwide, AC Hardware, REI Coop, Ocean Spray, Mondragon, Associated Press, and FC Barcelona are
well known, but because they project few of their cooperative values outward, there is
little public awareness of them being coops.
Cooperative businesses worldwide employ 250 million people.20 Mondragon, an
often-cited example of a thriving coop in a competitive market, is a federation of
worker cooperatives that was founded in 1956 in the Basque region of Spain. It is
worker-owned but not worker-managed.21 At the end of 2013, it employed 74,061
people in inance, retail, and education. Mondragon cooperatives are united by a
humanist concept of business, with the general manager in a Mondragon coop
making no more than ive times the minimum wage paid in his or her cooperative.
Compare that to Walmart’s CEO who is paid 1,034 times more than the median
Walmart worker.22
Existing platform coops and the larger ecosystem. Can platform coops overcome the
challenges of inequality, crowd leecing, systemic racism, and invisible labor? A few
examples will sketch an overview of the platform cooperative ecosystem.
The labor-brokerage Up & Go is a platform that connects users with professional house
cleaning services provided by low-income immigrant women who organized in local
cooperatives.23 The platform is cooperatively owned and governed by the women who
use it. As owners, they decide how they want to provide their services to clients. 95%
of Up & Go’s proits go to the workers in a market where corporate platforms take 25 to
50%. Up & Go provides access to digniied work for low-income communities and offers a living wage in an industry of predominantly Latino and African-American women,
to the beneit of their families and children.
The music-streaming site Resonate ofers a stream-to-own model driven by blockchain technology.24 Resonate is a multi-stakeholder cooperative that gives stakeholders democratic control: artists (45%), listeners (35%), employees (20%). The coop pays
musicians 200% more on 100,000 plays than Spotify.
Fairmondo is a cooperative online marketplace for ethical goods and services serving Germany and the UK. It is owned by a diverse group of stakeholders — buyers, sellers, workers, and investors — who exercise democratic control over the
platform through the one-member-one-vote principle.25 Contentiously, Fairmondo
18 National Cooperative Business Association, ‘Building a Cooperative Future,’ NCBA, 2014.
19 Ibid.
20 ‘Facts and Figures’, International Co-operative Alliance, http://ica.coop/en/facts-and-igures.
21 George Cheney, Values at Work: Employee Participation Meets Market Pressure at Mondragon,
Ithaca, NY: Cornell University Press, 1999.
22 ‘CEO Pay in Perspective: Infographic’, Payscale, http://www.payscale.com/career-news/2013/03/
ceo-pay-in-perspective-infographic.
23 https://www.upandgo.coop/.
24 http://resonate.is.
25 http://fairmondo.de.
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describes itself a cooperative alternative to Amazon and eBay, with the goal of defying such ‘winner takes all’ marketplaces.
MIDATA is a cooperatively owned, Zurich-based, online platform that seeks to serve
as an exchange for members’ medical data. Using an open-source application, members can selectively and securely share their medical data with doctors, friends, and
researchers. For-proit researchers are charged a fee, negotiated by the cooperative,
for the opt-in use of users’ data. These funds are used for the development and administration of the cooperative, with all surplus funds directed to public-good projects
selected by the cooperative. The cooperative aspires to use medical data as a proofof-concept for how cooperative data-aggregation can provide a safe way of monetizing
user-data for social beneit.
Green Taxi Coop, launched in 2015, is a cooperative taxi service that uses a mobile
phone app.26 It has 800 members among which are immigrants from thirty-seven countries.27 The Communication Workers of America Local 7777 helped clear regulatory
hurdles for them and leased Green Taxi Coop a basement oice. The coop received
$2,000 from each driver for startup costs and today, it holds a third of the ride-hailing
market in Denver, Colorado.
These ive examples can give you a sense of the various forms of platform coops. But
there is more. For me, 2014 was an intellectual turning point; I developed the concept
of platform cooperativism but a directory of this ecosystem did not yet exist. But it was
immediately clear that as an ecosystem, the organizations that supported platform
cooperatives were equally important actors. They provided them with, for instance,
payment systems (think: GratiPay28) or democratic decision-making tools like Loomio.29 Thanks to the work by the team at Internet of Ownership, close to 200 platform
cooperatives and related organizations worldwide have now been counted.30 These
businesses operate in sectors like short-term rental, transportation, data, inance, food,
governance, home services, music, and news. Platform coops are part of the scafolding on which a fairer future of work will be built.
Stocksy United
Let’s have a closer look at Stocksy. In early 2000, Bruce Livingstone founded the stock
photography company iStockphoto, which reached near-immediate proitability.31 iStock was the irst website of its kind and grew to support a vibrant community of freelance photographers. In 2006, Livingstone sold the company to Getty Images, one of
the largest American stock photography agencies, for ifty million dollars. Livingstone
resigned just three years later.32
26
27
28
29
30
31
32
http://greentaxico-op.com.
Out of the 800 members, only about 280 were active in 2017.
https://gratipay.com/about/.
https://www.loomio.org/.
http://ioo.coop.
https://web.archive.org/web/20000501000000*/iStockphoto.com.
Stephen Shankland, ‘iStockphoto founder, CEO leaves Getty’, CNET, 23 March 2009, https://www.
cnet.com/news/istockphoto-founder-ceo-leaves-getty/.
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Though Getty had paid 29% of revenues to photographers in the irst year after its purchase, the average rate for stock photographers at the time, the proportion of revenues
it paid out would eventually fall to just fourteen.33 As the reason for his forced resignation, Livingstone would later cite his refusal to enact policies of proit-maximization, to
the detriment of iStockphoto’s community.34 Tensions in the community grew, with calls
by iStockphoto contributors for the representation of photographers in the company
but Getty Images refused.35 Brianna Wettlaufer, the number four employee at iStockphoto, said of that period, ‘Everyone had the same story. They were feeling disenfranchised. They weren’t creatively inspired anymore. The magic was gone.’36
In March 2013, Livingstone and Wettlaufer founded a new stock photography website,
Stocksy United, with the funds from the sale of iStockphoto. For Livingstone and Wettlaufer, Stocksy United was a chance to make a better platform, informed by their experiences at iStockPhoto. The duo chose a cooperative model as a way of protecting
photographers’ interests and ensuring that a repeat of the Getty Images buyout could
not occur without the majority support of the cooperative’s members.37 Wettlaufer: ‘We
realized we could do it diferently this time. We could enter the market with a model
that ensured artists were treated fairly and ethically.’38
How it Works. Stocksy United is registered in British Columbia, Canada, as laws in the
United States are too restrictive to eiciently manage the payment of photographers
in countries across the globe.39 As Stocksy United’s more than 960 members reside in
sixty-ive countries, laws amenable to global operations are a prerequisite.40 If global
platform cooperatives are to become a more common challenge to investor-backed
irms that incorporate in each national market they enter, there is a an urgency to work
with local policymakers to secure regulatory frameworks which can support them.
Stocksy United’s low membership is a strategic decision the cooperative has made
in an attempt to sustainably scale itself. It began with 500 photographers and only
later opened applications for 500 more, but they still receive around 5,000 applications a year.
33 Roger Mexico, ‘Front Page Blog: A H*ck of a Lot! iStock contributors make $21 Million in 2007’,
iStock, 1 April 2008, http://www.istockphoto.com/forum_messages.php?threadid=67521; Brianna
Wettlaufer, presentation on Stocksy United, notes made by author in attendance, 23 May 2017.
34 Ashleigh Macro, ‘iStock Founder Reveals Real Reason He Left & Why He’s Started a New Stock
Company’, Digital Arts, 10 October 2013, http://www.digitalartsonline.co.uk/news/creativebusiness/founder-of-istockphoto-reveals-real-reason-he-left-why-hes-started-new-stock-photocompany/.
35 Sean Locke, ‘Steering the Ship’, Sean Locke Photography, 15 October 2013, http://www.
seanlockephotography.com/2013/10/15/steering-the-ship/.
36 Amy Cortese, ‘A New Wrinkle in the Gig Economy: Workers Get Most of the Money’, The New
York Times, 20 July 2016, https://www.nytimes.com/2016/07/21/business/smallbusiness/a-newwrinkle-in-the-gig-economy-workers-get-most-of-the-money.html.
37 Brianna Wettlaufer, ‘No More Bad Stock Photos: How a Great Image Inspired Me to Launch
Stocksy’, Success, 13 May 2015, http://www.success.com/mobile/blog/no-more-bad-stockphotos-how-a-great-image-helped-inspire-me-to-launch-stocksy.
38 Cortese, ‘A New Wrinkle in the Gig Economy’.
39 Brianna Wettlaufer, presentation on Stocksy United, notes made by author in attendance, 23 May
2017.
40 Nuno Silva, presentation on Stocksy United in Sydney, notes made by author in attendance, 23
May 2017.
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A lot of the other agencies have upwards of a million contributors, and at that point
everybody’s uploading the same thing shot in ten diferent ways, and people are
ighting over that one sale because the proit is so dispersed. We wanted to keep
the numbers low enough that people’s portfolios could sustainably grow, and their
income could similarly grow.41
According to Livingstone, this slow growth has allowed cooperative members to get
to know each other on a personal basis, writing to each other on forums hosted by
Stocksy United and helping to create a tightknit community. When photographers stop
participating in discussions or begin to submit fewer photographs, these interpersonal
relationships allow management to reach out and resolve the issue. To ensure there is
no rupture in these bonds, prospective applicants are judged speciically on their difference from the already contributing photographers. Livingstone noted that, ‘If someone’s shooting particular content in a particular style, and then we bring in someone
who’s doing the same thing, that’s no longer going to be a collaborative relationship
— it’s going to get very competitive.’42
In 2015 Stocksy United brought in $7.9 million in revenue, doubling its 2014 revenues,
and paid more than half of that — $4.3 million — in royalties.43 While most stock photography irms pay 15 to 45% of sales, Stocksy United pays photographers 50% of
revenue from non-exclusive licenses and 75% from exclusives.44 2015 was also the
irst year the platform brought in surplus revenue, which allowed it to pay $200,000
to the cooperative’s membership as dividends.45 The trend continued into 2016, with
the cooperative generating $10.7 million in sales, allowing it to pay $300,000 in dividends.46 As a multi-stakeholder cooperative, there are three diferent categories of
members which are aforded diferent proportions of this surplus under Stocksy United’s bylaws: the founders and full-time staf each receive 5% and contributing photographers receive 90% divided in proportion to individual photographers’ earnings on
the platform.47
As the Stocksy team is not planning to increase the number of photographers beyond
the 1,000 mark, it is reliant on the output of that relatively small group. They have to deliver a product that holds up to Stocksy’s criteria. To achieve that, the cooperative runs
online training that aims at showing photographers the way to take photographs that will
be accepted, a process which develops the talent of the photographers and increases
the value of the product. Rather than a race to the bottom with countless photographers
competing with ever lower price oferings and huge quantities of images, Stocksy United
invests in their photographers. Continuing education, one of the rules that I had deined
for good digital work in 2014, is part of Stocksy United’s business model.
41
42
43
44
45
46
47
Anna Bergren Miller, ‘Interviewed: Stocksy’s Brianna Wettlaufer and Nuno Silva on Building a
Cooperative Stock Photo Platform’, Shareable, 31 May 2016, http://www.shareable.net/blog/
interviewed-stocksys-brianna-wettlaufer-and-nuno-silva-on-building-a-cooperative-stock-photo.
Ibid.
Cortese, ‘A New Wrinkle in the Gig Economy’.
Ibid.
Ibid.
Email exchange with the author. June 2017.
Brianna Wettlaufer, presentation on Stocksy United, notes made by author in attendance, 23 May
2017.
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Ownership. Stocksy United is a producer cooperative which is a form similar to but
distinct from ‘worker-owned’ cooperatives. While worker-owned cooperatives take the
individual as their base unit of membership, classifying members as employees of the
cooperative, producer cooperatives are typically comprised of individual businesses
that share cooperatively owned infrastructure to gain advantages from economies of
scale.48 For example, farmers who belong to the producer cooperative Land of Lakes
share the costs of processing and distribution facilities, as well as a brand name under
which to market their goods, but still function as independent businesses with mostly
independent paths to market.49
Similarly, photographers who are members of Stocksy United are not employees, but
rather independent producers who cooperatively own the platform which markets and
sells their work. According to Wettlaufer, this producer-cooperative model was chosen
because though photographers are interested in having an outlet for their work that treats
them fairly and ethically, they tend to not be interested in the demands of the coop model
itself.50 Stocksy leadership is learning how to engage members to teach them about the
coop model and to give member-owners more of a sense of co-governance.
To become a member of the cooperative, applicants must submit a portfolio of their
work for review through Stocksy’s website. The artists selected from that pool are contacted for a more complete submission of full-resolution sample images.51 The cap on
cooperative membership to one thousand photographers allows for close observation
of members’ contributions, part of Stocksy’s goal of supporting career photographers,
not just people churning out cheap, ‘stocky stock’ product.52
Governance. Stocksy United’s governance structure is broken down into three
groups, with each group having a diferent level of involvement in the scale of the
cooperative’s operations. Class A is composed of the founders and senior advisors.
Class B is staf: the people who run the day-to-day. Class C is the photographers.
Major decisions — such as changing the terms of proit sharing, or business strategy
— are presented to the members for a vote in annual general meetings where any
member can propose a resolution.53
A resolution model based on member votes not only demands organizational transparency, it also gives members tangible voice in the big-picture operations. The pragmatic potential of the resolution process was made remarkably evident when the
48
49
50
51
52
53
John R. Whitman, ‘Types of Cooperatives’, Cooperative-Curriculum, 7 March 2011, https://
cooperative-curriculum.wikispaces.com/ile/view/Types+of+Cooperatives-Whitman.pdf.
Andrew McLeod, ‘Types of Cooperatives’, Cooperative Starter Series, December 2006, http://
cets.coop/moodle/pluginile.php/75/mod_folder/content/0/Types%20of%20Co-operative.
pdf?forcedownload=1.
Brianna Wettlaufer, presentation on Stocksy United, notes made by author in attendance, 23 May
2017.
‘About Becoming A Stocksy Contributor’, Stocksy.com, https://www.stocksy.com/contributor.
Lee Torrens, ‘Stocksy United’, Microstock Diaries, 13 July 2015, http://www.microstockdiaries.
com/stocksy.html.
Trebor Scholz and Nathan Schneider (eds), Ours to Hack and to Own: The Rise of Platform
Cooperativism, a New Vision for the Future of Work and a Fairer Internet, New York City: OR
Books, 2016.
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members — by a margin of 400 votes to four — voted to change the proit sharing
of extended licenses, accepting a decrease in payment to 75% from 100% proit
margin.54 The member-approved decision to reinvest value into the coop, instead of
retaining it as individual members, was, according to Wettlaufer, ‘a really proud moment — of everyone being truly committed to what was best for the company, and
what was best for them.’55
While the prospect of upwards of a thousand people meeting to discuss strategic planning may sound daunting, Stocksy United’s track record demonstrates that the method of member-based resolution is feasible. Cooperatives aren’t always more work,
as some critics have leveled. (Or, as Oscar Wilde put it, ‘The trouble with Socialism
is that it takes too many evenings.’) Wettlaufer: ‘It’s a matter of where you invest your
eforts, because at the end of the day if you’re a business, you’re always accountable
to somebody, and if you can choose who you’re accountable to, I would always want
to choose members.’56
What diferentiates Stocksy United from traditional stock photography websites is its
focus on quality over quantity. Wettlaufer says that the cooperative’s members are
proud to host only 700,000 photos, an exceptionally low number in an industry where
the volume of photos on ofer is considered a key to success.57 Cooperative members
use a private channel to examine new submissions, up and down voting them to determine which are appropriate for the site.58 Content curators reject about 50% of photo
submissions and an even higher percentage of video content.59
The goal is to avoid the quantity trap of the micro stock industry which iStockphoto
invented. Stocksy United claims a certain prestige position in the stock photography
industry. It has sold photos to 124 of Fortune 500 irms60 and its photos have appeared
in magazines like Elle and Glamour.61 By paying its photographers fairly and giving
them voice in the cooperative’s operations, the cooperative has been able to avoid a
race to the bottom and produce what it calls ‘sustainable stock’ that will not be diluted
as the platform’s catalog grows.62
Making Good
Platform cooperativism is only a few years old; it’s still an unproven economic model
but its cultural inluence is hard to ignore. Cooperativists are working on the ground
54 Anna Bergren Miller, ‘Interviewed’.
55 Ibid.
56 Brianna Wettlaufer, ‘Power and Ethics in Online Communities with Stocksy United’, Lecture,
University of Colorado Boulder, Boulder, CO, 15 September 2016, https://livestream.com/
accounts/983593/events/6351458/videos/135862964.
57 Nuno de Silva, presentation on Stocksy United, notes made by author in attendance, 23 May
2017.
58 Ibid.
59 Ibid.
60 ‘Platform Co-Op, Stocksy United, Doubles Revenue to $7.9M’, Business Wire, 8 June 2016, http://
www.businesswire.com/news/home/20160608005340/en/Platform-Co-Op-Stocksy-UnitedDoubles-Revenue-7.9M.
61 Amy Cortese, ‘A New Wrinkle in the Gig Economy’.
62 Brianna Wettlaufer, presentation on Stocksy United, notes made by author in attendance, 23 May
2017.
ALTERNATIVES IN FINANCIAL IMAGINATION
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and scholars, going beyond advocacy and inspiring articles, founded a new subield of
academic research focusing on platform cooperativism: what works and what does not
in terms of novel organizational forms and startup methodologies.63
With the fast-approaching baby boomer retirement wave, where business owners
may be amenable to buyouts by workers, the conversion of dated infrastructures
into platform coops also becomes a viable strategy to expand the model. Similarly,
the taking over of failing venture capitalist–funded platforms has become a possible
avenue of conversion.
The #WeAreTwitter64 campaign inspired scores of journalists, geeks, coop leaders to
think about ownership and governance of the platforms that we rely on most. It made a
name for itself. As a practical proposal, the campaign had only modest success when,
in May 2017, Twitter’s shareholders voted on whether to discuss the transformation
the platform into a user-owned cooperative. Over 4% of Twitter’s shareholders voted
in favor of discussing the proposal and it is now eligible to be debated again at next
year’s board meeting.
The Beneits of the Platform Coop Model
Platform cooperatives have numerous advantages over the traditional start-up model,
both in terms of market competition and societal beneit.
Protection from exploitation. Workers are protected from exploitation because they
co-own and steer the cooperative. Budgets and other inancial data are transparent to
members in platform coops like Fairmondo.
Lower retention costs. Retention is less of an issue on a platform where ownership,
transparency, and control protect workers from exploitation. It should surprise no one
that, given the extractive practices of Uber, 50% of drivers quit the platform after six
months, and only 4% of drivers make it a full year.65 Stocksy showed that photographers who are well compensated, being trained, and who have a say in what happens
on the platform, will stick with it.
Surplus revenues are transferred to members. Surplus revenue is seen by extractive
platforms as capital to be used for reinvestment or to be doled out as dividends to
investors. In contrast, numerous platform cooperatives return surplus revenue to
member-owners at the end of the year. Stocksy, which paid dividends of $200,000
to its members in 2015, uses this model but also Fairmondo, which returned 25%
of its yearly surplus to members.
63 Fewer millenials tolerate burnout in traditional structures. Top-down irms increasingly fail to hire
talent. How can platform coops structure themselves to welcome such young professionals? How
can they attract corporate dropouts?
64 http://buytwitter.org.
65 Chantel McGee, ‘Only 4% of Uber Drivers Remain on the Platform a Year Later, Says Report’,
CNBC, 20 April 2017, http://www.cnbc.com/2017/04/20/only-4-percent-of-uber-drivers-remainafter-a-year-says-report.html; Chris Tomlinson, ‘The Problem is with Uber and Lyft, Not City
Rules’, Huston Chronicle, 10 May 2016, http://www.houstonchronicle.com/business/columnists/
tomlinson/article/The-problem-is-with-Uber-and-Lyft-not-city-rules-7450937.php.
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Lower failure rate. 80% of cooperatives survive their irst ive years in business, as
compared to 41% of other business ownership models.66 On the one hand, this may
be because worker cooperatives are themselves more productive than conventional
businesses, ‘with staf working ‘better and smarter’ and production [being] organized
more eiciently’.67 On the other, the belief in a cooperative’s mission, can keep the business aloat long enough to achieve success. While Fairmondo is now self-sustaining,
its communications-lead, Christian Peters, describes that up to now, Fairmondo was
‘mainly carried by the ideology of the people who work’ there.68
Money lows within local communities. Corporate platforms use their intermediary
status to exact high rents on workers’ earnings. This means that a large portion of
money, which would have passed between the local participants of each transaction is
siphoned out of the community.
Against short-termism and the growth imperative . The Silicon Valley model motivated
by ‘exit’ rather than sustainable business has been perfected: 1) invest in a startup,
2) develop its technology just enough to grow a user base, 3) sell to a larger company
for a golden payday. This mode of thinking breeds apostles of short-termism and
growth at all costs.
Prospect of a cooperative data commons. For-proit companies that rely on the monetization of users’ data, such as Facebook, FitBit, and personal-genoming service
23andMe, do not pay users for the valuable data that they generate. Essentially, people are performing uncompensated data labor. Unlike corporations, the advantage of
coops is that they are explicitly designed to beneit each other. The health data cooperative MIDATA aims to allow users to come together and monetize the health-related
data, which they generate, particularly the genetic data of which we all have an equal
amount. While MIDATA will donate all its surplus revenue to public-beneit projects,
co-founder Ernst Hafen has noted that data cooperatives in developing countries
could generate a meaningful revenues for their populations. Amidst a broader discussion about privacy as a right versus privacy as a commodity, a cooperative data
commons is in reach.
Advantages Despite Obstacles
While several key obstacles to the proliferation of platform cooperatives pose diiculties to the model’s expansion, they are in no way insurmountable.
Funding. The greatest challenge faced by platform cooperatives is the acquisition
of funding in the absence of venture capital investment. So far, member-founders,
members of multi-stakeholder coops, and foundation capital have often borne the
brunt of startup costs. The Platform Cooperativism Consortium and Outlierventures.
io are experimenting with a platform coop crypto token that could pay FLOSS pro-
66 ‘The Co-operative Economy 2015: An Ownership Agenda for Britain’, Co-operatives UK, http://
www.uk.coop/sites/default/iles/uploads/attachments/co-op_economy_2015.pdf.
67 Virginie Perotin cited in Odin, ‘Worker Cooperatives are More Productive than Normal Companies’,
Generational Theory Forum, 13 May 2016, http://generational-theory.com/forum/thread-68post-416.html.
68 Felix Weth, Christian Peters, Merlint, and Fairmondo staf in discussion with the author, 2015.
ALTERNATIVES IN FINANCIAL IMAGINATION
211
grammers. Redundant costs could be greatly reduced if the code bases of platform
coops would be made freely licensable for other coops.
Governance. The problem of governance of distributed workers is unresolved. Platform cooperatives, however, explore new models of worker representation following
the one-worker, one-vote model, but no dominant form has emerged so far. Governance models focus on tools like Loomio and the democratic representation of diferent stakeholders via the election of board members.
Marketing. The marketing resources available to platform cooperatives are dwarfed
by those of incumbents like Uber and Airbnb who spend millions of dollars to seed
network efects in individual cities. Guerilla marketing projects like Crowdacting should
also leverage the vast social networks of conventional cooperatives.69
Value proposition. Platform cooperatives must keep their eyes on a strong value
proposition. They need to build digniied workplace practices that are also a suficient draw for consumers.
Network efects. As user bases grow, the value of a platform increases exponentially.
As platforms accumulate data, the eiciency of their algorithms rapidly increases. One
solution for this may be to create federations of local cooperatives, which can scale
locally while still beneiting from their participation in larger networks. Alternatively,
platform cooperatives may ind their greatest success when they are able to enter
untapped markets too small to hold interest for the Big Five.
Regulation. Finally, the regulatory inroads of incumbent platforms serve as something of a double-edged sword; while, for example, Uber’s challenges to local regulations prohibiting non-licensed ride-hailing services opens up space for ride-hail
platform cooperatives, they are also able to lobby to eliminate regulations that favor
platform cooperatives.
Broader questions still remain. Will any of the historical disadvantages of coops be
ofset by the technological afordances of platform cooperatives? What models for
democratic governance efectively account for the reality of dispersed gig-workers? What is the reason that relatively few coops have decided to enter the digital
economy? Is voting for a board of directors suicient? Are there existing funding
solutions that have been overlooked, such as blockchain-driven social currencies
and crypto-tokens? What interface design models can counteract the harmful racial dynamics of online labor markets such as TaskRabbit? What sectors are most
promising for the growth of this model? How can the principles of economic democracy — which drove the 20th century cooperative movement — be brought
into, and accelerated, in today’s emerging digital economy? How can investors in
the digital economy make a fair return while these types of platforms achieve sustainability? How can we ind a framework of analysis that goes beyond the success
or failure dichotomy given the diverging forms of value creation that may play out
over the long- rather than the short term?
69 https://www.youtube.com/watch?v=u6tqZqoh8DY.
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Platform cooperativism can serve as a remedy for some of the corrosive efects of
capitalism, serving as a reminder that work can be dignifying rather than diminishing
for the human experience. Platform cooperatives are not a panacea for all the wrongs
of platform capitalism. They will have to tie in with the diverse eforts of the solidarity
economy, the pro-commons movement, b-corps, green activists, localist movements,
and others. There is a common ight and platform cooperativism can do its part against
the shared enemy of exploitation. It’s time to weave some ethical threads into the fabric
of 21st-century work.
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UNIVERSAL BASIC
INCOME IS
A NEOLIBERAL PLOT
TO MAKE YOU POORER
DMYTRI KLEINER
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UNIVERSAL BASIC INCOME IS
A NEOLIBERAL PLOT TO MAKE YOU POORER
DMYTRI KLEINER
This article was irst published by Furtherield.1
Basic income is often promoted as an idea that will solve inequality and make people
less dependent on capitalist employment. However, it will instead aggravate inequality
and reduce social programs that beneit the majority of people.
At its Winnipeg 2016 Biennial Convention, the Canadian Liberal Party passed a resolution in support of ‘Basic Income’. The resolution, called ‘Poverty Reduction: Minimum
Income,’ contains the following rationale: ‘The ever growing gap between the wealthy
and the poor in Canada will lead to social unrest, increased crime rates and violence.
[...] Savings in health, justice, education and social welfare as well as the building of
self-reliant, taxpaying citizens more than ofset the investment.’2
The reason many people on the left are excited about proposals such as universal
basic income is that they acknowledge economic inequality and its social consequences. However, a closer look at how universal basic income (UBI) is expected to
work reveals that it is intended to provide political cover for the elimination of social
programs and the privatization of social services. The Liberal Party’s resolution is
no exception. Calling for ‘Savings in health, justice, education and social welfare
as well as the building of self-reliant, taxpaying citizen’,3 clearly means social cuts
and privatization.
UBI has been endorsed by neoliberal economists for a long time. One of its early champions was the patron saint of neoliberalism, Milton Friedman. In his book Capitalism
and Freedom,4 Friedman argues for a ‘negative income tax’ as a means to deliver a
basic income. After arguing that private charity is the best way to alleviate poverty,
and praising the ‘private […] organizations and institutions’ that delivered charity for
the poor in the capitalist heyday of the nineteenth century, Friedman blames social
programs for the disappearance of private charities: ‘One of the major costs of the
extension of governmental welfare activities has been the corresponding decline in
private charitable activities.’
To Friedman and his many powerful followers, the cause of poverty is not enough
capitalism. Thus, their solution is to provide a ‘basic income’ as a means to eliminate
social programs and replace them with private organizations. Friedman speciically
1.
2
3
4
https://www.furtherield.org/universal-basic-income-is-a-neoliberal-plot-to-make-you-poorer/.
‘Poverty Reduction: Minimum Income’, Liberal Party of Canada, https://winnipeg2016.liberal.ca/
policy/poverty-reduction-minimum-income/.
Ibid.
Milton Friedman, Capitalism and Freedom, Chicago: University of Chicago Press, 1962.
ALTERNATIVES IN FINANCIAL IMAGINATION
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argues that ‘if enacted as a substitute for the present rag bag of measures directed at
the same end, the total administrative burden would surely be reduced’.5
Friedman goes on to list some the ‘rag bag’ of measures he would hope to eliminate:
direct welfare payments and programs of all kinds, old age assistance, social security,
aid to dependent children, public housing, veterans’ beneits, minimum-wage laws,
and public health programs, hospitals and mental institutions.
Friedman also spends a few paragraphs worrying whether people who depend on
‘Basic Income’ should have the right to vote, since politically enfranchised dependents
could vote for more money and services at the expense of those who do not depend
on these. Using the example of pension recipients in the United Kingdom, he concludes that they ‘have not destroyed, at least as yet, Britain’s liberties or its predominantly capitalistic system’.6
Charles Murray, another prominent libertarian promoter of UBI, shares Friedman’s
views. In an interview with PBS, he said: ‘America’s always been very good at providing help to people in need. It hasn’t been perfect, but they’ve been very good at it.
Those relationships have been undercut in recent years by a welfare state that has, in
my view, denuded the civic culture’.7 Like Friedman, Murray blames the welfare state
for the loss of apparently efective private charity.
Murray adds: ‘The irst rule is that the basic guaranteed income has to replace everything else — it’s not an add-on. So there’s no more food stamps; there’s no more
Medicaid; you just go down the whole list. None of that’s left. The government gives
money; other human needs are dealt with by other human beings in the neighborhood,
in the community, in the organizations. I think that’s great.’8
To the Cato Institute, the elimination of social programs is a part of the meaning of Universal Income. In an article about the Finish pilot project, the Institute deines UBI as
‘scrapping the existing welfare system and distributing the same cash beneit to every
adult citizen without additional strings or eligibility criteria’.9 And in fact, the options
being considered by Finland are constrained to limiting the amount of the basic income
to the savings from the programs it would replace.
‘Basic Income’ Won’t Alleviate Poverty
From a social welfare point of view, the substitution of social programs with marketbased and charitable provision of everything from health to housing, from child support
to old-age assistance, clearly creates a multi-tier system in which the poorest may be
5
6
7
8
9
Ibid., p. 158.
Ibid., p. 160.
Charles Murray, ‘Libertarian Charles Murray: The Welfare State has Denuded our Civic Culture’,
PBS News Hour, 10 April 2014, https://www.pbs.org/newshour/nation/libertarian-charles-murraythe-welfare-state-has-denuded-our-civic-culture.
Ibid.
Charles Hughes, ‘Finland to Break New Ground with Basic Income Experiment’, CATO Institute,
9 December 2015, https://www.cato.org/blog/inland-break-new-ground-basic-incomeexperiment?utm_content=bufer3f10a&utm_medium=social&utm_source=twitter.com&utm_
campaign=bufer.
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able to aford some housing and health care, but clearly much less than the rich —
most importantly, with no guarantee that the income will be suicient for their actual
need for health care, child care, education, housing, and other needs, which would be
available only by way of for-proit markets and private charities.
Looking speciically at the question of whether Friedman’s proposal would actually improve the conditions of the poor, Hyman A. Minsky, himself a renowned and
highly regarded economist, wrote the The Macroeconomics of a Negative Income
Tax.10 Minsky looks at the outcome of a ‘social dividend,’ which ‘transfers to every
person alive, rich or poor, working or unemployed, young or old, a designated money
income by right’.11 Minsky conclusively shows that such a program would ‘be inlationary even if budgets are balanced’12 and that the ‘rise in prices will erode the real
value of beneits to the poor […] and may impose unintended real costs upon families with modest incomes’.13 This means that any improved spending power aforded
to citizens through an instrument such as UBI will be completely absorbed by higher
prices for necessities.
Rather than alleviating poverty, UBI will most likely exacerbate it. The core reasoning is quite simple: the prices that people pay for housing and other necessities are
derived from how much they can aford to pay in the irst place. If you imagine the
way housing is distributed in a modern capitalist society, the poorest get the worst
housing, and the richest get the best. Giving everyone in the community, rich and
poor alike, more money, would not allow the poorest to get better housing, it would
just raise the price of housing.
If UBI came at the expense of other social programs, such as health care or child care,
as Friedman intended, then the rising cost of housing would draw money away from
other previously socially provisioned services, forcing families with modest incomes to
improve their substandard housing by accepting worse or less childcare or healthcare,
or vice versa. A disabled person whose mobility needs requires additional expenditure
on accessible housing may not have enough of the basic income left for any additional
health care they also require. Yet replacing means testing and special programs that
address speciic needs is the big idea of UBI.
The notion that we can solve inequality within capitalism by indiscriminately giving
people money and leaving the provisioning of all social needs to corporations is extremely dubious. While this view is to be expected among those, like Murray and Friedman, who promote capitalism, it is not compatible with anticapitalism. UBI will end
up in the hands of capitalists. We will be dependent on these same capitalists for
everything we need. But to truly alleviate poverty, productive capacity must be directed
toward creating real value for society and not toward maximizing shareholder value of
proit-seeking investors.
10
11
12
13
Hyman P. Minsky, ‘The Macroeconomics of a Negative Income Tax’, Hyman O, Minsky Archive, 16
May 1969, digitalcommons.bard.edu/cgi/viewcontent.cgi?article=1428&context=hm_archive.
Ibid., p. 1.
Ibid., p. 4.
Ibid., p. 5.
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There is No Possibility of Another Kind of Basic Income
Many people don’t dispute the fact that establishment promoters of UBI are only doing it in order to eliminate social programs, but they imagine that another kind of basic
income is possible. They call for a basic income that disregards the deal that Charles
Murray advocates, but want UBI in addition to other social program, including meanstested beneits, protections for housing, guarantees of education and child care, and
so on. This view ignores the political dimension of the question. Proposing UBI in addition to existing program mistakes a general consensus for replacing social programs
with a guaranteed income for a broad base of support for increasing social programs.
But, no such broad base exists.
Writing in 1943, with the wartime policies of ‘full employment’ enjoying wide support, Michal Kalecki wrote a remarkable essay entitled ‘Political Aspects of Full
Employment.’14 Kalecki opens by writing, ‘a solid majority of economists is now of
the opinion that, even in a capitalist system, full employment may be secured by a
government spending programme’.15 Though he is talking about full employment,
which means an ‘adequate plan to employ all existing labour power’,16 the same
is true of UBI. The majority of economists would agree that a plan to guarantee an
income for all is possible.
However, Kalecki ultimately argues that full employment policies will be abandoned: ‘The maintenance of full employment would cause social and political
changes which would give a new impetus to the opposition of the business leaders. Indeed, under a regime of permanent full employment, the “sack” would cease
to play its role as a disciplinary measure. The social position of the boss would be
undermined, and the self-assurance and class-consciousness of the working class
would grow.’17
The conlict between the worker and the capitalist, or between the rich and the poor,
can not be sidestepped simply by giving people money, if capitalists are allowed to
continue to monopolize the supply of goods. Such a notion ignores the political struggle between the workers to maintain (or extend) the ‘basic income’ and the capitalists
to lower or eliminate it in order to strengthen their social position over the worker and
to protect the power of ‘the sack’.
Business leaders ight tooth and nail against any increase of social beneits for workers. Under their dominion, only one kind of UBI is possible: the one supported by
Friedman and Murray, the Canadian Liberal Party, and all others who want to subject workers to bosses. The UBI will be under constant attack, and unlike established
social programs with planned outcomes that are socially entrenched and diicult to
eliminate, UBI is just a number, one that can be reduced, eliminated, or simply allowed
to fall behind inlation.
14
15
16
17
Michael Kalecki, ‘Political Aspects of Full Employment’, Political Quarterly (October 1943): 322330.
Ibid., p. 322.
Ibid., p. 322.
Ibid., p. 326.
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UBI does not alleviate poverty and turns social necessities into products for proit. To
truly address inequality we need adequate social provisioning. If we want to reduce
means testing and dependency on capitalist employment, we can do so with capacity
planning. Our political demands should mandate suicient housing, healthcare, education, childcare and all basic human necessities for all. Rather than a basic income,
we need to demand and ight for a basic outcome — for the right to life and justice,
not just the right to spend.
References
Friedman, Milton. Capitalism and Freedom, Chicago: University of Chicago Press, 1962.
Hughes, Charles. ‘Finland to Break New Ground with Basic Income Experiment’, CATO Institute, 9 December 2015, https://www.cato.org/blog/inland-break-new-ground-basic-income-experiment?utm_
content=bufer3f10a&utm_medium=social&utm_source=twitter.com&utm_campaign=bufer.
Kalecki, Michael. ‘Political Aspects of Full Employment’, Political Quarterly (October 1943).
Minsky, Hyman P. ‘The Macroeconomics of a Negative Income Tax’, Hyman O, Minsky Archive, 16 May
1969, digitalcommons.bard.edu/cgi/viewcontent.cgi?article=1428&context=hm_archive.
Murray, Charles. ‘Libertarian Charles Murray: The Welfare State has Denuded our Civic Culture’, PBS
News Hour, 10 April 2014, https://www.pbs.org/newshour/nation/libertarian-charles-murray-thewelfare-state-has-denuded-our-civic-culture.
‘Poverty Reduction: Minimum Income’, Liberal Party of Canada, https://winnipeg2016.liberal.ca/policy/
poverty-reduction-minimum-income/.
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PRECARITY IS
THE PRESENT,
UNIVERSAL BASIC
INCOME THE FUTURE
PATRICE RIEMENS
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PRECARITY IS THE PRESENT,
UNIVERSAL BASIC INCOME THE FUTURE
PATRICE RIEMENS
Il n’y qu’à une population parfaitement sous contrôle
que l’on peut songer ofrir un revenu universel.
—Comité Invisible, Maintenant
UBI — universal, unconditional basic income — is popular talk regarding both the
economic future of the majority, and the ‘labour market’. Amazingly, UBI’s inevitability
is taken for granted, but opinions on its format and modalities are so iercely debated
as to result in confusion about what UBI (should) represent(s). This essay attempts to
outline common opposing viewpoints and propose a simple resolution to reach consensus on the matter.
Precarity is deined here as crippling uncertainty about one’s economic and/or social
future. If precarity is the problem then UBI is, to some extent, the answer.
The increasingly precarious conditions of an increasingly large number of people,
in both the Global South and North, is the most urgent socioeconomic and political
problem of the moment. Poverty and inequality are both its result and its most visible
symptoms. This translates to hardships including want, homelessness, poor mental
and physical health, hitting a substantial, and ever growing number of people. It is also
seen in even more widespread long-term economic uncertainty and vulnerability. Furthermore, it afects negatively the overall well-being of society, making it ‘meaner and
leaner’, less benevolent and uniied. Last but not least: it ultimately hurts the economy,
and in no small measure.
Precarity now afects the population at large, directly or indirectly. It evidently afects
the under-privileged, but also hurts large swathes of the better-of. Middle class people live increasingly in fear of becoming victims of economic melt-down and social
status downgrade. Their often highly educated ofspring are confronted by a labor
market where steady job openings are vanishing. There is great anxiety regarding a
future that appears devoid of any prospect of a better life, even one as good as their
parents had enjoyed.
The provision of a universal, unconditional income is the sole reasonable and realistic
answer. Yet one should realize that, if ever, and properly, implemented, UBI will in no
way resolve all at once society’s many socioeconomic problems; pockets of poverty
will remain, and inequality will decrease, but not disappear. Far more importantly,
humanity still will have to resolutely address an unprecedented convergence of crises, foremost environmental. But the odds of this endeavor succeeding will surely be
enhanced with UBI.
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On the Shifting Nature, and Valuation, of Work, and its Consequences
A largely shared premise is that regular, secure, long term salaried employment as we
know it will greatly disappear thanks to robots and algorithms. Observers of current
trends talk of a major disruption, predicting that artiicial intelligence of all kinds will
destroy not only low-skilled work (e.g. cleaning), but also those more highly-skilled
occupations (e.g. accounting), leaving only a minority of especially creative and innovative tasks for humans. This assumption, reasonable as it appears, is not totally
warranted. It depends on the evolution of what Marxists call the ‘social relations of
production’. Under speciic, unwelcome socio-political dispensations, large-scale automation could just as well result in a plethora of ‘coolie labor’, provided its costs are
low enough. However, we can be sure about the disappearance of work-as-we-know
it, something already experienced by the younger generations.
This scenario will obtain whether through outright job destruction, or rather large-scale
job displacement. This is also the consequence of another, unfortunate development:
the waging of essential work like ‘care’ as traditional community and household bonds
dissolve. Yet such newly waged work is not translated into secure employment at a
fair rate of pay, but instead into a variety of lexible, exploitative contractual or informal
arrangements. This has in turn spawned the notion that all work should be viewed and
remunerated in this way. Business and its right-wing advocates have demanding this
for a long time, and they increasingly succeed in imposing this ‘new normal’ as the
template for employment in general, transferring previously salaried work into unpredictable jobs without guarantees and rights and with lower remunerations, worsening
working conditions and diminishing beneits.
Society, as it moves away from the ‘abusive, historic, identiication of work with salaried work’ (Carlo Vercellone), appears to jettison salary instead of work. UBI, properly
understood and implemented, should foster security of income entirely independent of
work, whether waged or not.
The ongoing disappearance of salaried work has engendered the perverse belief,
widely shared in libertarian and neoliberal circles, that traditional, collective work has
no merit, and should be spurned. Merit (and value) should solely accrue to individual
entrepreneurship, and the labor that underwrites it should ruthlessly be lexibilized
for proitability. Labor, like all other ‘factors of production’, is deemed to carry a zerobase price, meaning that every increment should be viewed as a cost and pruned as
much as possible.
The withering of a stable link between work and a secure wage has been well-theorized. ‘Gig economy’ and ‘Uberization’ typify economic relationships praised by the
libertarian elite, but hardly by those forced by circumstances to engage in them. Where
work is remunerated it is for the outcome of the actual work, at an often much lower
rate. I will illustrate the point through the example of the ‘intermittents du spectacle’
in France (portrayed, a.o. by Bernard Stiegler). The ‘intermittents’ are people working
during the cultural season, and hence only part of the year, in the technical side of
cultural events and productions. Theirs is a condition of part-time employment (hence
‘intermittent’), but of full-time work, spending the cultural season’s ‘slack time’ (roughly
7-8 months) in quasi-permanent education and training, honing the skills they need
to perform the array of tasks assigned during the summer’s events. The later work is
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perceived as merely technical, routine-like, and paid accordingly, but the real work in
the ‘slack’ times is not waged, while the waged job, in season, only consists in putting
the outcomes of this work into practice — at devalued rates. Workers are paid, part of
the year, low-skilled wages for their eforts at maintaining high-skilled competence, the
time spent on which is only retributed in the form of unemployment beneit. Needless
to add, this is itself under vociferous attack by employers, since the ‘intermittents’ do
not perform visible, and hence quantiiable work during that time.
This pattern, which arose in the realm of ‘cultural production’, is now becoming the
‘new normal’ in more professions. That it took root in the traditionally underfunded and
looked-down-on spheres of the arts and culture is not an unfortunate coincidence. It
reverberates the increasingly ‘dematerialized’ quality of work in many sectors of the
economy (e.g. ‘services’ instead of ‘industrial production’), where erratic relationships
between work and pay are easier to implement. This is why teachers with short-term
and part-time contracts are no longer paid for the time they spend preparing lessons
and refresh courses.
Thus all forms of work tend to be downgraded in monetary terms and security of
employment, while working conditions go down almost faster than the pay. This follows from the deleterious economic discourse described above, which should be understood as profoundly ideological. Where only entrepreneurship is valued, ‘ordinary’
work and the human being performing it, becomes an inconvenience, a maximally
compressible cost factor. No wonder this attitude often goes together with wet dreams
about full automation, where illusions of zero labor costs are only outmatched by delusions about the direct and indirect costs of ‘hiring’ robots.
This is further fueled by widely adopted, pernicious algorithm-based management
tools, appropriately dubbed ‘weapons of math destruction’ by Cathy O’Neil in her
book of the same name. Make no mistake, such ideas about managing the corporate
economy are not merely business-as-usual; they are also detrimental to sound and
sustainable business in the long term. Since the efects of short-termism are perfectly
well known, it simply comes down to lining one’s pockets at the helm.
UBI disrupts the commonly held belief that earning money through work is essential
for survival, something society apparently inherited from the Judeo-Christian tradition
(‘in the sweat of thy brows thou shall eat bread ...’). UBI, by providing the guarantee of
an acceptable standard of living to all, prevents the foreseeable race to the bottom in
terms of wages, working conditions, and security of income for the majority. It enables
the 99% to invoke and enforce the power to say no. Conversely, in the absence of UBI,
increasingly scarcely remunerated slots of the future global workplace will continue
under increasingly abusive conditions. Society at large will revert to something close
to a Hobbesian state: solitary, poor, nasty, brutish, and short. Such a scenario would
hopefully be unpalatable even to the 1%. Therefore we may conclude that UBI is both
necessary and unavoidable.
What UBI Should Be — or Not Be
Having looked at the material aspects which point to the implementation of UBI, it is
also essential to look at the immaterial ones.
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If UBI is conceived as not only a mere prop to personal incomes but also an essential
building block towards a fairer society, it becomes impossible to implement if looked
at only from a strictly individual security point of view. A purely economic approach to
UBI risks becoming an argument about ‘reforming’ the welfare state, replacing not only
individual, but also collective beneits. This is the hardly concealed design of the right,
bent on abolishing welfare altogether, releasing huge savings on the state budget to
immediately transform these in tax cuts for the rich.
It is therefore essential that UBI be not only a guaranteed income, but also an assurance regarding one’s opportunities as a fully participating member of society. What the
latter makes possible is freedom, both negatively — e.g. freedom of fear — but also
positively, as the enhanced possibility to act at one’s own liking. UBI is therefore the
harbinger and the pre-condition to bring about a just and more convivial society.
We can also look at UBI as the rightful retribution for what one does for society, merely
by virtue of one’s existence — by simply being there. That may seem abstruse at irst
sight, but it is not diferent from the rights granted to any person on the constitutional
level. It only extends such rights in the material sphere, which are already enshrined in
most constitutions where it is the irst and inal duty of society to ensure the well-being
of each of its members.
We can conclude that UBI should be and cannot be anything else but a contributory
beneit, representing a universal and unconditional right to the material means of a
decent life. It presents an all-inclusive opportunity to participate actively and fully in
societal life. We understand by this the freedom to engage in activities which are both
beneicial to the community and gratifying to the person performing them, something
sorely lacking under present conditions. If UBI were to come about, there is no doubt
that a diferent type of human society would slowly emerge, which would take up seriously, at the very least, the development of so-called ‘green capitalism’. One may of
course hope, campaign and militate for more, for a vast and genuine transformation of
society towards the sustainable future we all crave.
We can now turn to a few practical questions which have bedeviled the debate
about UBI.
On 3 Practical Questions Commonly Voiced About UBI
1. Can UBI be Financed?
The answer is an unqualiied yes — the money is there. But only if there is the political
will strong enough to take the necessary economic measures, speciically in the sphere
of taxation. This requires a relatively easy (if politically daunting) realignment of the
share of the iscal burden between categories of contributors, and this means between
households and irms. It would also require a substantial ‘de-inancialization’ of the
economy on a somewhat longer term, that is a near-reversion of the ratio between ‘immaterial’ (aka ‘virtual’) and ‘material (aka ‘real’) money in society’s iduciary balances.
Indeed, the amounts rolling over in the global inancial sphere exceed the sum total of
actual on the ground economic activities by a factor 10 — or higher. Once introduced,
UBI may well accelerate this shift even further since, at present, the inancial behemoth
largely feeds on debt, a lot of which consists of consumptive credit.
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Taxation-wise, after careful study of its consequences on the distribution of wealth and
incomes, (speciically, on its impact on the incomes of the poorer parts of the population) one could think of fully streamlining taxation into one single measure: a tax on all
monetary and inancial transactions, that is, on all formal movements of money.
2. Will the Introduction of UBI Depress Work-Related Incomes, Wages and Other Remunerations?
Here the answer is a slightly more qualiied no, as very much hinges on the modalities
of UBI as implemented. However, a genuine UBI sets the loor of individual income
at a level that secures all a person’s basic needs. Obviously, the problem here lies
with the deinition of basic needs. The higher the standard is set, the more diicult
it becomes to fund. But conversely, too low a standard would obliterate the very
opportunities UBI is intended to provide. And on the marketplace of labor the most
important one for a job seeker is the efective right to say ‘no’. This is the trickiest
issue regarding the implementation of a sustainable and efective UBI policy. Yet in
any case, having to pay good money for work which by its nature cannot fall within
the voluntary sphere, and for which there still is a demand, will remain a fact of life in
the commercial sphere. Thus businesses will have to propose appropriate earnings if
they wish to recruit motivated collaborators.
Therefore, once a reasonable standard of UBI is established, there is little reason to believe that ‘the going rate for labor’ would fall substantially below the currently prevailing
one. Wages might even turn out to increase, since businesses will have to compete
with the non-commercial, non-proit sector of the economy, opening up many rewarding activities in the ‘commons’ sphere, given the existence of UBI.
This is the also the principal argument to reject any declination of UBI implemented
along lines proposed by some right-wing/ libertarian opinion leaders: slashing or abolishing outright social/public services as a quid pro quo for its introduction under the
false pretense of budget neutrality. Such a fraudulent neo-liberal/ libertarian interpretation would not only keep the scourge of precarity going, but indeed quickly transform
UBI into not a minimum but a maximum income for the ‘99%’.
3. What of the Place of Welfare (as We Know it) After UBI?
The answer is that it should largely stay in place — if thoroughly reformed. Neo-liberal/
libertarian economic doctrine, having, reluctantly, accepted the inevitability of UBI,
demands it be traded against a massive reduction, or even total abolition, of welfare
as we know it. Yet, cuts in social beneits and subsidies on public service provisions
like housing, health or education, translates in immediate additional expenditures for
recipients of UBI, nullifying all the advances it represents. Slashing subsidies and making public services more expensive would defeat UBI’s other crucial purpose: buying
social peace in economically unsettled times for the majority.
Hence, maintaining a welfare state — minus direct monetary transfers — that is consistent with providing access of essential services to all is not only a corollary condition, it is a sine qua non of an authentic UBI. In the end, UBI, the maintaining of such
subsidies and the provision of public services at a budget neutral level will have to be
funded by mobilizing existing resources in society, meaning an increase in taxation.
Many economists have done the math already and concluded that the overall level of
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taxation would indeed rise after UBI, but far less than argued by detractors. Furthermore, shifts in the modalities of taxation, as already alluded to, will enhance the income
position of the poorer households, and would make little or no diference to the average taxpayer (though wealthier classes will be hit harder than at present).
We may look now at some other important issues pertaining to, or impairing, the debate around UBI.
On the Political Outcomes and Consequences of UBI
A growing perception of economic and other forms of insecurity among an increasing
part of the population — well-illustrated by the popularity of the precarity moniker —
has made those individuals disgruntled with the existing political dispensation.
This has fostered, in the Global North, the appearance and stark expansion of extreme
political movements, especially at the right side of the spectrum. These are threatening
democracy, the rule of law, the arts and culture, and human rights and fundamental
liberties in general. Unlike those of the political left, the right’s arguments are, not so
slowly and stealthily, being adopted by established (center-)right parties.
One should never forget the rise of European Fascisms in the 30s. However uncomfortable the fact, these were truly popular movements, and their rise was greatly helped
by the previous powers being unable or unwilling to stem the general impoverishment
caused by capitalism’s crisis and the ensuing Great Depression. We are at the threshold of a crisis of the same, if not perhaps even greater, magnitude.
That lesson should be clear and UBI is evidently the sole alternative to this disaster
happening repeatedly. Decision makers failing to confront this, be it by design or by default, can be sure to pay sooner rather than later for the price of their shortsightedness.
The Risk of a ‘Pull Efect’ of UBI on Immigration
This issue is indeed a big elephant in the room when discussing the likely outcomes
of UBI. The opinion that granting UBI to everyone in a given territory would attract
masses of (poor) outsiders and make the system unsustainable is widely shared in
some circles, and is just as widely being suppressed among their opponents. Both
extremes are unfortunate and prevent cool-headed reasoning.
The likelihood of a pull efect is real. But it should be seen in present and future contexts. Granting unrestricted UBI to immigrants delivers a diferent outcome compared
with the settled population because immigrants wish, in general, to earn money not
only for themselves, but also for their kin at home. They are thus resolute savers and
remitters, and this practice undermines an unstated but not unimportant purpose of
UBI: pushing local demand for goods and services.
There are several possible answers to this situation short of preventing immigration,
which is as impractical as it insults basic morality.
To start with, the imbalances caused within society at large — speciically by excessive
marketisation and inancialization — should be addressed. Regarding UBI, part of it
could be ‘demonitized’ by making a basket of social goods and public services avail-
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able for free, e.g. health, and education, or at a very nominal cost, e.g. housing, utilities,
transport. This would be to retain part of UBI in the economy that funds it. Formalizing
and expanding the use of local currencies, possibly ones carrying a demurrage charge
(cf Silvio Gesell), is another option. Making UBI partly payable on electronic instruments (e.g. chipcards) with a limited geographical validity is feasible, but goes with a
contraction of a recipient’s freely disposable income. Even non-iat crypto-currencies
have popped up in some UBI blueprints, but then, among other things, stark issues of
general usability arise.
Finally, one could trade an initial UBI disqualiication of immigrants, against allowing
them free movement in and out of a particular UBI-allocating jurisdiction. Immigrants
could then gradually gain access to UBI, say after several years, as is the case with
naturalizations. This would also alleviate fears of an ‘alien tsunami’.
‘Legions of Couch Potatoes’ as a Consequence of UBI
Morally (turbo-)charged opponents of UBI often allege that, among many other evils,
UBI would efectively amount to a premium on laziness and lull its beneiciaries into
a terminal coma of gawking in front of screens 24/7/365. Some corroboration to this
might come from surveys in the U.S. among recipients of social beneits, especially
MedicAid. They also point out the addictive efects of almost permanent ‘social’ media
usage within our thoroughly fragmented and individualized society, especially among
those with limited schooling and skills
This, however, appears to be an exaggerated scenario. One can expect UBI, once
implemented, to trigger an at least partial reformation of society towards more voluntary work openings, more conviviality and more co-operative and relaxed lifestyles in general. This would provide both the opportunity and the drive to participate in ‘the commons’ in one way or another. There for sure will be a minority of
people preferring to enjoy what others may see as totally empty idleness, but that
will be a very tolerably small one (one recipient in 10? One in 8?). This is not a valid
reason to ditch UBI.
Taxation and the ’Poverty Trap’
We have briely discussed that, given reform in the current system of taxation, UBI is
afordable, even if it would constitute a major component of public expenditure. But
this is no way unworkable, or even unprecedented. The French social security system,
for instance, swallows up 30% of current GDP (100% when it began after WWII!), and
yet nobody seriously suggests abolishing it.
Some tricky issues will remain unresolved, however, and might derail UBI implementation unless carefully attended to:
1. Direct (Income) Taxation After UBI
Some have suggested income-taxing from the very irst unit earned after and above
UBI, preferably in conjunction with a (low) lat tax — the evergreen dream of the political right. This suggestion should be resisted; like the curtailing of social and public
services, this would intolerably reduce recipients’ actual disposable income, as well as
reduce the total amount of tax leviable.
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There should be a tax credit/rescission extending quite some way after UBI (my
hunch is: up to the amount of another UBI) to ofer maximum incentive to participate, in some way, in economic life. After that, income tax rate should not be lat but
instead progressive, and steeply so, both to fund UBI, and also to decrease income
inequality. Concurrently, punitive taxation should apply to (very) high incomes, to
achieve a further reduction in (material) inequality. This would be merely a reversal to
the situation prevailing for two or three decades after WWII in the Global North, where
in some countries the highest marginal rate of tax was surprisingly close to 100% (as
in the USA!).
2. Indirect Taxation and UBI
The idea of substantially funding UBI, and state expenditures in general, by way
of steep levies on consumption, particularly sales and value added taxes (VAT),
has proved invidiously popular, especially on the right. This only conirms what is
economically acknowledged, and politically ignored: that indirect taxation is highly
regressive and favors the wealthier segments of society. In fact, the tweaking of
VAT upwards functions as a proxy for unrealizable lat tax on incomes, and should
be rejected on the same grounds. Levies on consumption afect people with low
incomes much more than they burden the rich, whose larger outlays in investments,
savings etc. are taxed less if at all. High levels of indirect taxation hence inevitably
cancel out some of the desired income efects of UBI, even though high demerit
taxes on environmentally or otherwise socially objectionable elements of consumption should be admissible.
3. (Social) Beneits After UBI, and the Scourge of the ‘Poverty Trap’
We have already argued that a curtailment of social beneits after UBI is a total no-go.
However, maintaining them as they are administered in many jurisdictions is also a
dead-end. Under the current dispensation, beneit recipients are gradually weaned
of them as their income increase. Unfortunately, this ‘decrement by increment’ policy
results in practice in a tax on the additional income approaching 100% — sometimes
even exceeding it — something that would of course be utterly unacceptable if it hit
wealthier citizens. This state of afairs now constitutes a potent disincentive to accept
any form of work not very highly paid, and that would not change under a UBI regime.
Hence, phasing out of income supporting subsidies, while acceptable in itself, should
be done very gradually like slabs in a progressive income tax, and so not result in an
unfair loss of incremental income.
It should be clear by now that UBI demands a new approach to taxation and all its
income-related corollaries afecting households. But it should be equally clear that this
approach requires caution, lest the appearance of perverse, negative efects. A pragmatic, if politically tricky, approach would simply be shifting away the main burden of
taxation from the personal (‘households’) to the corporate (‘irms’), as mentioned earlier. A more radical but preferable approach, in my view, would be to do away with the
whole concept of taxation and move towards a single, universal levy on the movement
of scriptural money — the money of the rich and the corporates — while leaving cash,
and/or its (yet to be developed), electronic stand-ins of the hook. This is undoubtedly
heady stuf, which clearly needs further research. But it might be our only way towards
a better society in the long run.
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The ‘Problem’ of Funding UBI
The absurdly simple — if diicult to comprehend in a politically productive manner —
answer to any ‘TINA’-styled objection to UBI merely lies in an elementary modiication
of the choice of two out of three options made by a government, options which, if
taken together, are incompatible.
These options are: (i) maintaining/increasing the standards of living of the national
population as a whole; (ii) allowing for the free movement of capital between unequally
governed jurisdictions with regard to taxes, labor laws, etc. and (iii) stabilizing monetary values, i.e. the exchange rate of the national units of account against those of
other countries.
Under transnational capitalism, ired by a neo-liberal, and now increasingly libertarian,
ideology, this choice has systematically favored the last two elements. This at the detriment of the irst, even though it embodies the vast majority of the people.
Undoing this choice is a primal condition, yet also an inescapable outcome of introducing UBI on a large scale. It will also have the positive efect of cutting deeply into
the rent incomes of the 1%.
Basic or Minimum Income, Disposable Income, and UBI: Welcome to Obfuscation Central
Under our current dispensation the common attribute and trend of all lower incomes,
indiferent to whether they are waged or obtained through social beneits, is an everdiminishing proportion of freely disposable household income left after all necessary,
incompressible expenses (e.g. rent, insurances, taxes, etc.) have been paid. This is
even the case when the income obtained is itself not declining or even moderately
increasing. This is the irst thing that needs to be considered, and reverted, before and
when implementing UBI. Therefore, a healthy margin of freely disposable income must
be ensured for UBI recipients, because it forms a basic requirement to alleviate the
feeling of precarity and encourage initiatives.
The question of at which amount UBI should be set is a vexed one. Here opinions
vary greatly, and aside from real or perceived funding issues this is caused by confusing UBI with a minimum or ‘basic’ income. A better point of departure would be a
living income (as in ‘living wage’ demanded by labor unions), ensuring one lives not
on the edge of poverty but with dignity. That need not require an extravagant sum,
but is surely something signiicantly above the absolute poverty line. Amounts of
CHF 2550 or €1200 a month for a single person in Switzerland and the Netherlands
respectively have been suggested, and appear realistic to ensure a decent, if sober, living standard. Conversely, any amount dished out to citizens (a.k.a. ‘helicopter
money’) is welcome and will some way go towards fulilling the purpose of UBI. But
it should not be called UBI.
Finally, it is unavoidable to stress and repeat that UBI should be unconditionally universal. Ridiculing the prospect of zillionaires receiving UBI is damnably disingenuous,
since progressive income tax will recoup those monies, and then some. Playing ball
with unconditional universality is a blueprint for the kind of red tape and meddlesomeness that has disqualiied for good ‘nanny state’ welfare.
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Introducing UBI at a fair level of allowance will largely, if not entirely, eradicate precarity,
precarity understood as economic uncertainty and/or vulnerability. After receiving UBI
it will remain each individual’s responsibility to deploy the necessary initiatives to move
up the ladder of material achievement, if so wished.
Poverty, especially relative poverty, will be substantially lessened, although not totally
obliterated. At the bottom tier of the social order, UBI payments will ensure a decent,
if sober, living standard. At the top of the income and wealth pyramid, steeply progressive taxes should reduce incentives to demand and obtain unbecoming levels of
remuneration. Furthermore, outlandish displays of wealth and luxury, which are all too
common in our times, will carry, if not moral rejection, then a hefty tarif. Outlandish
levels of conspicuous consumption are a powerful social destabilizer, and should be
challenged.
Inequality, to conclude, will be partially tackled but certainly not overturned, with the
introduction of UBI. One should dare to argue that its elimination does not, and should
not, rank very high in the aims of UBI. Social engineering has limits which should be
acknowledged and respected, and experience shows that inequality is not much resented if kept within reasonable bounds. Meanwhile, a general ‘softening’ of society,
which one may expect from implementing UBI, should go a long way to latten the distribution of what former Dutch PM Joop den Uyl famously, if problematically, described
as the hallowed trinity of ‘knowledge, power, and income’.
References
The ultimate resource on UBI is the BIEN site, for Basic Income Earth Network:
http://basicincome.org/.
The Precariat, the social category the most talked about when it comes to UBI has it
own singular store of expertise, clustered in one individual: Guy Standing. He is basically a one-man resource to next to everything that needs to known and said about
UBI: http://www.guystanding.com/.
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ON INTENSIVE
SELF-ISSUANCE:
ECONOMIC SPACE
AGENCY AND THE
SPACE PLATFORM
ECONOMIC SPACE AGENCY
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ON INTENSIVE SELF-ISSUANCE: ECONOMIC SPACE
AGENCY AND THE SPACE PLATFORM
ECONOMIC SPACE AGENCY
Preamble in the shape of an ofering
The power of inance in our hands doesn’t need to be just about raising funds or making money. It can be an invitation to risk and speculate together to open up new possibilities and modes of coming together.
For most of us, inance is a predatory and extractive practice that takes more than it
gives. But what if at the heart of inance we found a logic of active ofering? A ritual
ofering gesture — the creation of a time interval in the derivative form of a gift1 — that
both opens up and holds open new economic spaces?
Economic Space Agency is crafting a new platform, Space, to take up a unique
economic, ethical, aesthetical and political challenge: reinventing inance as a collective practice of crafting futures and rethinking value at the end of the economy as
we know it.
For we are always already at stake with each other, partnered all the way down. Inhabitants of the world, earthlings and earthbounds, creatures of all kinds, human and
non-human, we are entangled in a series of interlaced trails and creative feedback
loops, holding open life for one another. In the economic spaces to come — the world
we want — everyone holds pieces of each other’s life, socially and inancially. We are
entre-preneurs and entre-donneurs — inter-holders and inter-givers — networked together to collectively distribute the risks and opportunities of living.
From Robin Hood Asset Management to Economic Space Agency
Back in the day we were a group of hard core researchers of the coming forms of
economy and organization. We knew that it would not be a picnic when we started using thinkers from the French post-structuralist tradition like Michel Foucault,
Jacques Derrida, Gilles Deleuze, Felix Guattari, and the then Italian autonomist writers, Toni Negri, Christian Marazzi, Paolo Virno, Maurizio Lazzarato, Franco Berardi,
1
The Wealth of Societies project has developed a compelling reading of the derivative form as gift.
Instead of rehearsing the usual critique about the extent to which markets are colonizing our lives
and institutions, they instead wonder if derivative inance ofers anything new to the old debate
over what money can or can’t buy. Their answer articulates as a multi-faceted inquiry about how
the gift economy foreshadows contemporary derivative form: ‘The gift and the derivative share
the property that both take the volatilities and uncertainties of social life and transform them into
manageable risks by equating things that are diferent. […] It is the play of the interval (unlike
stocks, options have expiration dates) that produces the wealth that derivatives are capable of
producing (what’s known technically as “convexity”). Gift exchanges take diferent inherently risky
“social lows” and commensurate them via ritualized performances. The interval of time between
gift and countergift produces the “social convexity” that creates wealth in the form of new social
claims and obligations.’ Benjamin Lee and Randy Martin (eds), Derivatives and the Wealth of
Societies, Chicago, IL: The University of Chicago Press, 2016, p.2.
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and others to study and understand economy, inance and organization. But we knew
that this was the way to do it if we were to really grasp how post-Fordist economy,
semiocapitalism, immaterial and afective labor, and the inancial technologies work
and intertwine with our destiny.
With these thinkers, we were able to discern a couple of interesting things:
– how signs and meanings are part of real production and not only some kind of
ideology or superstructure of production;
– how the dynamic of the production of value lies in the coming together of
heterogeneous forces, and not only in the relationship between capital and labor;
– how information overlow and semiotic inlation lead to imitation;
– how inance can curb time, how it is essentially a technology to afect the future
from the present;
– how economy is essentially about organization, not of action but its potentiality;
– how the meaning of autonomy is in internal displacements, shiftings, iterations,
settlings and dissolutions that are the processes of the self-composition; autonomy
means to be able to set the attractors of one’s own behavior.
The paradoxes of immaterial production and precarious work, and the blurring of the
boundaries between economy and politics, disrupt the approaches and distinctions
of industrial economy and its institutions. We think that the common ground of art
and politics is in the collapse of old forms of society, economy and subjectivity and
in the creation of these new forms. This is where they meet, and this is where we ind
ourselves in work. We need to start creating new concepts and imagining new social
and inancial forms.
What can these new forms be today? How can they be created?
Our pilot in hacking inance to create new social and inancial forms was Robin Hood
Asset Management — a hedge fund with a twist. In fact, three twists. First, it is a cooperative. Individuals who buy shares become members and decide how the coop is run.
One member, one vote. Second, part of the proit generated by the fund is invested
into projects building the commons. Third, the money put into the fund is managed by
an algorithm called ‘the Parasite’. She logs into the brains of the bankers at Wall Street,
deconstructs them into databanks, and uses big data analysis and structured inance
to share their most important means of production to everyone.
The next step takes the logic further: not only stealing from the rich and giving to the
poor (like Robin Hood did), but exploring, building new ecologies, new ecosystems,
new universes, new possibilities, new worlds of value. For this purpose the Robin
Hood hydra grew a new head: a start-up company called Economic Space Agency
(ECSA). Here is what we propose to remake the DNA of the economy as we know it.
The Space Platform: Toward Programmable and Non-Linear Economic Spaces
This is a historic moment. Following the emergence of blockchain and decentralized
digital technology, social, economic and inancial forms are becoming for the irst time
integrally programmable.
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The Space platform initiated by Economic Space Agency is an open, collaborative
smart contract ecosystem based on the fourth generation (post)blockchain technology,
Gravity.2 The Space platform enables the creation of fully modular and interoperable
economic spaces. Economic spaces are protocols of economic, inancial and social
interaction, of value and risk creation, of sharing and distribution of resources. They are
self-governed, peer-to-peer programmable organizations that can operate together in
an emergent network, formed dynamically through the relations they establish between each other. Rather than conceiving one totalizing economy, Space envisions the
interoperation of a plurality of micro-economies, each with its own governance model,
value creation logic and capacity for tokenized self-issuance. These micro-economies
will be structurally interoperable to the extent they desire, and they will be able to utilize
the structures created by others as a basis of their own operations.
The Space platform responds to the necessity of envisaging and concretizing emergent and non-linear ways of coming together. These new modes of event-based collective self-organization are better attuned to the value creation processes that are
already happening in our midst and to which our current economic system is mostly
blind. The limitedness of the current monetary and economic system does not provide
an adequate metric to assess all other kinds of values that do not it economic quantiication and outcome-based evaluation models — such as psychological, social, aesthetic, and ecologic ‘proitability’, lattening the heterogeneity of collective initiatives
and neutralizing their potential to generate and distribute values in our milieus.
Every digital platform, from goliaths like Facebook to the fringest of forums, creates
a space of encounter and gathering generating values of diferent types. We use the
term economic space to designate the immaterial and material system of coordinates
and attractors that gives shape to how people create and interact with resources, assets, values and their diferent modes of expression and representation. We conceive
of these economic spaces as non-Euclidean. The term may sound strange or even
extravagant, but non-Euclidean economic space has a speciic meaning. A Euclidean economic space is deined by the competition of economic agents over scarce
resources. The individual agents are deemed to have clear and persistent boundaries,
and relate to each other via linear transactions. In a Euclidean economic space, something pre-produced is divided. This is the space the politicians and economic experts
talk about when they say there is no alternative to the current economic system and
ask us to blindly abide to austere monetary policies.
In contrast, non-Euclidean economic spaces move beyond the imaginary of limitations, austerity, scarcity and powerlessness, foregrounding a continuous unfolding of
possibilities, options, connections and creativity. When resources and afordances get
shared on a distributed platform, they become nomadic and start to mutate. NonEuclidean economic spaces call for a non-linear distribution where nothing pertains or
belongs only to one person, but all persons are arrayed here and there in such a manner as to make possible a greater range of interactions. Nomadic economic spaces
are the associated milieu of the networked tribes of the 21st century. They are the
2
For more detailed information about both Space and Gravity, check the respective White papers
on our website: www.economicspace.agency.
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spaces of continuous innovation and metamorphosis. Think of them as n-dimensional
programmable and vibratory organizations that allow for the creation and circulation
of new types of value. Econauts will navigate these inancial and futurial borderspaces
that are not hard and bounded — liminal spaces that allow you to fold yourself within
and without.
The general purpose of the Space platform consists in open sourcing inance: to become an easily usable launch pad for rapid creation, deployment, sharing, customizing,
copying and remixing of modular, interoperable and self-governing economic spaces.
The platform enables communities and individuals to make their own ofers, issue their
own programmable tokens and set their own value systems. As such, the design of
economic space becomes a means of collective self-expression; that is: an occasion
to enunciate and manifest inancial values that escape the disiguring market logic of
generalized equivalence. Through the platform’s template approach, users have access
to lexible tools to invent and construct new (or simply reproduce existing) modes of
organization to leverage the unrealized value of socially networked production.
Currently, every process of value creation is forced to plug into an exploitative monoeconomy3 core system that lattens out all other forms of value. The resulting inancialization of the social has fostered spiraling indebtedness, the decreasing price of
labor, and erosion of the welfare state. Yet, from households to cities, from software
to trade, the work and very being of people are what back the underlying value of inance. Simultaneous to this unrecognized backing, we are tethered to the instruments
of inance to access new value.
We are only seeing the beginning of an intensive and multi-faceted process of decentralization and redeinition of socio-inancial relations towards greater multiplicity and
autonomy. One way of critically engaging with this nomadic re-engineering of inance
is to envisage it as an expressive medium. In essence, inance is not primarily about
money: it is a mode of coordinating the future and its emerging possibilities through
the collective design of attractors and the distribution of lows of desire. Finance thus
appears as the opening of a shared temporal interval in which new things can happen
by risking and speculating together.
Finance concerns the capacity to bring future potential into the present through monetization, enabling future investments in the present by making them liquid. The possibility for inancial actors to manufacture inancial instruments out of debt and equity,
thereby impacting volatility and liquidity in markets, has become a political weapon
to orient and organize the masses. In response, Economic Space Agency makes it
possible to approach inance with a hacker attitude and a poetics of experimentation.
This is our wager: we want everyone to be able to harness the power of inance as a
technology for coordinating and sharing the future in which we want to live.
3
We use ‘monoeconomy’ in analogy with the term monoculture (monocropping etc.), in which one
species (out of a whole spectrum of possible species) dominates the ecosystem, and not in the
precise technical sense the term monoeconomy is used in development economics. ‘Monotheistic
economy’ might be another term, connoting the theistic elements discernible in current economic
dogma.
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Short Technical Overview
The Hyper Text Transfer Protocol (HTTP) that deines how information is transmitted
over the web is ‘stateless’ and it needed a data layer on top of it for any application
functionality. This data layer was provided by the winners of yesterday: Google/search,
Facebook/social, eBay/commerce. It allowed them to capture the data and the value
and drove the centralization of the web.
Bitcoin introduced blockchain technology and cryptocurrency to the world, creating a
decentralized network of trust optimized for resiliency, veriiability and anonymity. Blockchain allows data to be maintained in a decentralized way, thus challenging value capture models based on centralized control. Ethereum then built upon the consensusbased decentralized architecture of Bitcoin, adding a Turing complete scripting language
with which to build applications. P2P crypto-currencies, smart contracts and secondgeneration blockchain tokens are introducing new ways of coordinating vast networks,
as well as new ownership models based on mutual stakeholding in the protocol layer.
While crowdfunding and P2P lending are the irst steps toward the disintermediation
and personalization of inancial relations, the next phase in technological and inancial
development must involve the possibility for everyone to gain concrete access to the
design of their own economic agency. As a truly distributed smart contract ecosystem
that enables a new way of designing and powering event-based and other forms of
programmable organizations, the Gravity + Space platforms are overcoming the limitations of logically centralized blockchains such as Bitcoin and Ethereum. Both of these
models are fundamentally based on the same computing platform: a shared distributed ledger in case of Bitcoin, and a shared world computer in the case of Ethereum, run
by every node on the network, processing every line of application code run by every
application in the system. This replication has tremendous beneits in terms of transparency and fault tolerance. However, the World Computer architecture introduces redundancies and limitations that are inconvenient and ineicient for many applications.
Smart contract-based applications have become varied enough so as to beneit from
more lexibility than the World Computer architecture typically ofers.
Instead of a World Computer implementation, Gravity ofers a platform for building
interoperating networks of decentralized computers — a World Computing Fabric architecture. A World Computing Fabric is a modular, object capability-oriented architecture for building resilient, veriiable networks of virtual machines. This enables a
new approach for creating systems and protocols for the digital economy made of
natively scalable, interoperable smart contract and smart organization networks. Gravity is smart contracts and smart organizations unchained.
Beyond Extractive Finance: Toward Mutual Stakeholding
While inancial institutions and corporations are seeking to take advantage of blockchain
afordances, they merely reproduce old familiar models and logics on these emerging
technologies. But the new smart contract platforms have not yet been irretrievably colonized by existing inancial interests. We have a small (and closing) temporal window to
create something else. As the history of the Internet shows, the early adopters will play
a profound role in shaping the sense and direction of the novel, emergent economic and
organizational forms that might, one day, be as commonplace as social media today.
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The current inancial system is essentially based on relations of debt and equity — the
former concentrated in the hands of the many and the latter controlled by the elite few.
The increasing supply of government bonds (safe means for capital preservation) is
possible only through deicit cuts and excluding all inlationary spending. Presently,
expansion in the forms of indebtedness is the condition for capital accumulation, just
like the growth of labor force participation was for expanding commodity production.
ECSA wants to change this state of afairs by promoting relations of equity between
the diferent economic spaces. By doing so, ECSA conceives of the economic spaces
built on top of its platform as partners, rather than subjecting them to the extractive relations that characterize the contemporary inancial paradigm. Equity acts as the horizontalizing force through which all econauts have access to, share in, and harvest the
derivative value made available through the interoperability of heterogeneous abstract
metrics. By ofering the possibility to participate (i.e. have actual stakes) in occasions
for inancialization through equity relations, ECSA enables the collective steering of
inancial dynamics and mechanisms for the purpose of collective redistribution and the
overspilling of heterogeneous values. It does so by concretely giving econauts the ability to issue their own ofers, organizations and tokens (and other kind of instruments)
— that is, providing the capacity to index those values they want to share and sustain
according to metrics they determine. This unprecedented move furnishes liquidity to
the social and relational insensible production of value, and allows for the circulation/
distribution of that liquidity in an ecosystem that collectively acknowledges those values — for the collective livelihood of that ecosystem.
By activating our mutual stakeholding with equity relations, we ofer people production
power, inance’s future-wielding capacity, rather than merely empty consumption power. As a technology for the de-diferentiation of risk and value lows, synthetic inance
becomes a powerful instrument for the dynamical creation and distribution of common
equity, as the lifeblood circulating through and interconnecting the ECSA ecosystem.
Following a crucial insight developed by Randy Martin and further extended by the Volatility Group, we think of the inancial derivative as a technology to amplify the power of
autonomous organizations, once it is used in the context of self-created economic space
and made accessible through easy user interfaces and ready-made templates. These
inancial instruments organize — weave together, distribute, branch — economic lows,
and thereby create new modes of relation — modes which were previously unavailable,
impossible, or even nonexistent. By operating the instruments of synthetic inance, one
gets to arrange the attractors of one’s own behavior, to shape the rhythms and patterns
of the economic spacetime where behaviour expresses itself. With the Space platform,
it becomes possible to express ‘the way we are social with each other’, the mutual indebtedness and collective stakeholding that compose our common wealth.4
4
‘Such would be the political promise of a politics for derivatives, namely that it treated the
immanent mutual indebtedness of populations as a means for them to gather and enact what the
social could mean and embody. [...] recognizing the world crafted through the operations of the
derivatives leads toward the entangled constitution of mutual indebtedness, of the ways that we
are social together, even if we never fuse as one.’ Randy Martin, ‘From the Critique of Political
Economy to the Critique of Finance’, in Benjamin Lee & Randy Martin (eds), Derivatives and the
Wealth of Societies, p. 190.
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ECSA wishes to provide a new array of inancial tools to those of us who are not
bankers, traders or state-actors, such that a new generation of non-exploitative inancial arrangements may emerge. With the Space platform, you will be able to leverage
the power of inance — the power of risking and speculating together — allowing
participation in a multi-dimensional ecosystem of economic spaces relying on equity
relations and all sorts of optionalities. The time has come for people to take inance
back into their own hands so as to make a claim on the enormous amount of wealth
surrounding us. In the end, ECSA is committed to supporting a collective shift from inance as a technology of capital, based in debt and primitive accumulation, to inance
as a form of production of new kinds of equity relations and commonfare production.
Responding to the inancialization of the social, the inherent laws of the sharing
economy, the tendency toward the automation of work, and the limitations of current blockchain solutions, ECSA's mission is to provide an open yet safe platform
for the interoperability of heterogeneous value and risk systems and the scalability
of token-based economies to create new social, economic and inancial relations.
Just as the internet fundamentally changed communication by transforming the role
of author, publisher, photographer, and media maker, ECSA will transform inance,
potentially enabling hundreds of millions of people to author economic spaces and
control their inancial relations.
In sum, ECSA’s Gravity + Space platform ofers:
1.
2.
3.
4.
an operating system for the crypto-economy based on World Computing Fabric;
modular, copy-able, interoperable tools for the design of new economic spaces;
a repository of smart programmable organization templates;
a unique occasion to unleash the power of collaborative inance.
We Don’t Know Yet What a Token Can Do: Notes on Intensive Self-Issuance
The Re-Engineering of Money
Money isn’t simply something that serves as an intermediary for exchanges: it informs
the very way we come together as large-scale collectivities. The complexity of inancial
instruments (money-forms) has developed to hedge the risk of interdependence: gold,
paper, systems of account, debt, credit, stocks, options, derivatives all indicate an advancing complexity in the functionality of quantitative metrics. Money is, for all practical purposes, the medium for social synthesis in capitalist commodiied societies. It is
the elementary technology for psycho-collective individuation in the techno-social and
economic ensemble known as capitalism. Therefore, we need to conceive of money
as a technical object of social design, that is, something that can and needs to be reengineered to serve our collective aspirations.
The invention of Bitcoin urged us to rethink fundamental assumptions about the functional organization of the contemporary monetary architecture and its impact on the
operative logic of inance. Bitcoin and subsequent alt-coins remind us that money is
not a natural given, but an artiicial medium — precisely, a technology. This doesn’t
mean that money is simply ‘arbitrary’; it is rather a real abstraction that has developed
in complexity with the increasing complexity of society. As such, we should start taking control of its constitution, design, and functioning for our own communities of
exchange, instead of letting it be designed by and for the wealthy.
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The excitement around blockchain is an excitement around a new means of encryption
that takes one huge step towards the democratization of inance through techniques
of decentralization. Hold a dollar and you have no idea of its history or of the history of
its production. Beyond your immediate moment, you don’t know who sweated for that
dollar, or for that matter, who died for it. Money has always been a kind of encryption
process, but the code and thus the controls have been hidden away — sequestered
in the hands of the most powerful: central banks, inanciers and their militaries and
states. With the domination imposed by imperial inance ordinary people were incapable of engineering their own inancial spaces or of proposing the rules of their own
systems of valuation in the inancial register.
Today’s extractive logic of inance is intimately linked to monetization as the mechanism by which social, cultural, economic, ecologic values are rendered commensurable with each other, lattening heterogeneous values-in-formation onto the only unit of
account we know of (so far) — iat money — according to the principle of scarcity embedded in it. In contrast, the Space platform ofers the opportunity to any individual or
collective to issue fully programmable tokens and organizations. These crypto-based
tokens and organizations allow anyone to design metrics of value that will function as
attractors around which to orient the creation of their own economic spaces or economic constellation. Self-issuance signiies that any agent can issue value, proposing
it to other agents — its valuation is therefore a general question for the society at large
and a practical question for each individual agent, whenever they face an ofer for it.
In current inance, value masquerades as objective, actively suppressing the highly
protean emergence of value and the variegated forms it takes. But valuation, we argue,
is ultimately a matter of collective expression. Instead of imposing a uniform system of
value upon us, like iat currencies enforce, ECSA's key goal is to create a platform for
rendering the rich, heterogeneous multiverse of values socially and inancially liquid.
Ultimately, ECSA envisages self-issued tokens not just as currency or equity, but also
as speculative prions that begin to propagate new forms of exchange and new decentralized organizational models.
Anarchiving Finance?
Let’s venture one step further into what the collectively expressed multiverse of values
could entail. One of the challenges we have been facing concerns the economic imperative of conservation-through-exchange, that is, the function of money as store of
value. Schematically put, the problem with the traditional economic form of exchange
is two-fold. On the objective end, the capitalist form of exchange obviously enables a
deleterious logic of ininite accumulation. It conditions the lattening regime of generalized equivalence and the thoroughgoing quantiication of our life-world. On the subjective end, it creates a practical solipsism that engenders the reciprocal exclusion of
ownership. Social value is always intimated at some level, but it is muted by the storevalue capacity of money which establishes and re-establishes the individual with every
transaction. The economical subject of interest is essentially a conservative subject:
it is a terminal at the end of the economy stuck within a proprietary subjective form.
The key question at the core of new economic space design relates to the anarchiving
of the value stored in the traditional money-form. How do we anarchive the surplusvalue of life in order to distribute it anew? From the processual perspective of the anar-
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chive, something always escapes. The notion of the anarchive foregrounds the qualitative eventfulness that exceeds any computational and systemic capture. For example,
an economic exchange is never only a binary relation between two pre-existing parties.
It is always-also a generative event with its own forward-momentum, a singular spacetime created by the encounter of heterogeneous forces at a given moment. What other
measures of magnitudes could be used to modulate the dissipation of value throughout
the network against the logic of capture and storage inherent in the traditional process
of exchange? How do we distribute value so that it is virtually and immediately felt as
free-lowing abundance instead of triggering patterns of restrictive accumulation? How
do we design a token that does not simply store value but dissipates it throughout the
ecosystems through which it circulates? This is fundamentally an ecological problem,
one that requires assuming new monetary perspectives folding and unfolding of ndimensional relationships that distribute value in impersonal, generative ways.
Think of the token as a propositional force, a sparkle of potentiality. It is a multi-dimensional docking port that can germinate new forms of relations and value sharing. The
token here is an occurrence, a virtual time-crystal expecting its transductive associated milieu in which to catalyze new relational constellations. It is an instance of value
capture, but only insofar as it acts, simultaneously, as, a fugitive relay collectively modulating and amplifying values. Conceiving of tokens as speculative pragmatic relays of
anarchic shares is a way of entertaining them as generator of collective efervescence
that escapes usual forms of capture and containment.
An intensive and eventful issuance of the kind we are envisioning here needs to interact with other self-issuances in order to express, sustain and appreciate its qualitative
value diference in time. As anything truly social and valuable, the propositional force of
each token is both joyful and precarious — in a word: adventuresque. Self-issuance is
about exposure to an outside, but it doesn’t necessarily mean a full-ledged exposure
to the ‘great outside’ of the market. Self-issuance can be modulated at will, following
the afordances of a given ecosystem and in response to the inter-species web of entanglements in which it is embedded. Finance as an expressive medium commands a
logic of implication. The anarchiving power of the self-designed crypto-token, in contrast with the traditional money-form, could look for that which overspills as the necessary condition for what has occurred and may yet occur, through forms of retrospective
valuations. In any economic space in-formation, ields of relation are in operation, not
just exchanges between individuals. The anarchive is the awareness of the inter-touch
concurring with/in an environment spreading ecologically.5
To Value or Not to Value? Abstraction Without Extraction
Trotsky, somehow anticipating Hayek, believed that the transition to communism still
required a metrics of value. One could not dispense with the notion of ‘abstract universal labor time’ or the money-form prematurely. The emergence of ever more supple
forms of computation/communication seems to indicate that it may be possible to abstract and self-capture our (immaterial) production without submitting to exploitation.
5
For further considerations about the anarchiving power of self-issuance, see Anarchiving inance:
A Free Indirect Deck About the Ee-engineering of Money, a document realized onsite during the
SenseLab event ‘Distributing the Insensible: Performing the Anarchive’, Montreal, December 2016.
https://www.youtube.com/watch?v=qeClrxHrg98.
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Abstraction without extraction: we need to imagine new economic spaces that would
preserve the qualitative dimension of our modes of relationality, but could also produce
quantiied and interoperable value-units; that is, potentially exchangeable with other
emergent commons and micro-economies.
Our hope is that if we allow for the construction of economic spaces of open, at will
participation that simultaneously produce horizontal wealth, these cooperative commons will interact not only among themselves but with one another, as to ultimately
attract all who are exploited into a more nurturing economy — one where the price of
entry is not selling your proverbial soul.
Postlude: Félix Guattari Foreseeing ECSA and the Space Platform
It is less and less legitimate that only a proit-based market should regulate inancial
and prestige-based rewards for human social activities, for there is a range of other
value systems that ought to be considered, including social and aesthetic ‘proitability’ and the values of desire. Until now, these non-capitalist domains of value
have only been regulated by the State; hence, for example, the esteem in which
national heritage is held. […] Beyond recognizing a universal basic income — as a
right rather than as some kind of ‘New Deal’ – the question becomes one of how to
encourage the organization of individual and collective ventures, and how to direct
them towards an ecology of resingularization. […]
What condemns the capitalist value system is that it is characterized by general
equivalence, which lattens out all other forms of value, alienating them in its hegemony. On this basis we must if not oppose, at least superimpose instruments of
valorization founded on existential productions that cannot be determined simply
in terms of abstract labour-time or by an expected capitalist proit. The information
and telematic revolutions are supporting new 'stock exchanges' of value and new
collective debate, providing opportunities for the most individual, most singular and
most dissensual enterprises. […]
It must also be stressed that this promotion of existential values and the values of
desire will not present itself as a fully-ledged global alternative. It will result from
widespread shifts in current value systems and from the appearance of new poles
of valorization.6 (our emphasis)
References
Guattari, Félix. The Three Ecologies, trans. Ian Pindar and Paul Sutton, London: The Athlone Press,
2000 (1989).
Lee, Benjamin, and Randy Martin (Eds). Derivatives and the Wealth of Societies, Chicago: The University of Chicago Press, 2016.
Martin, Randy. ‘From the Critique of Political Economy to the Critique of Finance’, in Benjamin Lee
and Randy Martin (Eds), Derivatives and the Wealth of Societies, Chicago: The Universty of Chicago
Press, 2016.
6
Félix Guattari, The Three Ecologies, trans. Ian Pindar and Paul Sutton, London: The Athlone Press,
2000 [1989], pp. 64-66.
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COMMONFARE OR
THE WELFARE OF
THE COMMONWEALTH
GENERAL INTELLECT
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COMMONFARE OR THE WELFARE
OF THE COMMONWEALTH
GENERAL INTELLECT
In contemporary capitalism, both labor and social policies are indissolubly linked. The
separation between labor-time and lifetime disappears with the prevarication of labor.
Bio-capitalism1 abstracts the time of life into a relational commodity. Neoliberal governance ensures all value is drained from whatever potency lingers in the struggle of existence. Any residue of welfare, as has been handed down in Europe by hard fought political gains and for a time upheld by the state, is completely overwhelmed by technics
of extraction. Now is the time to update the concept of welfare. It must be adequate
to the current situation, respectful of gender, ethnic and educational diferences, and it
must guarantee the wellbeing of the community; the welfare of commonwealth2 must
replenish life with quality and a right to joy.
The compensative expansion that characterized Fordism, simultaneous growth of
wages and proits, has now been exhausted. Today public welfare is perceived as a
cost whose funding depends on the iscal deduction of value produced by the capitalist market economy: a deduction that jeopardizes market competitiveness. In this
logic, public welfare is no longer afordable.
With the spread of neoliberal policies, welfare institutions are increasingly ‘capitalizing’. Above all, they become directly manageable by the private market hierarchy.
Keynesian public welfare, no longer governable with the constraints imposed on the
public budget, is gradually replaced by an exclusionary form of workfare. Workfare is
a not a welfare system: it is guaranteed only to those who have the inancial means to
pay for it (such as private pension). It is a self-inanced welfare system, as in most of
today’s European retirement system, comparable to the privatization policy of health
and education. Therefore, workfare is complementary to the so-called ‘principle of
subsidiary’ according to which a state may take action only if, and in so far as, the
objectives cannot be satisfactorily achieved in a private way.
The concept of social re/production is paradigmatic of cognitive bio-capitalism. It includes the main novelties of the accumulation and valorization paradigm, by considering a wide range of activities, from care, health, education to knowledge and culture.
1
2
Bio-capitalism (or bio-cognitive capitalism) is deined as an accumulation and valorization process
based on the exploitation of knowledge and the commodiication of life. Learning and network
processes are at the core of value creation, as well the diferent daily acts of life, more and more
inserted in a productive cycle, often without being aware of that (e.g. education, consumption,
leisure time, care, and so on).
The term commonwealth, as used in this text, refers to its original meaning of ‘wealth of the
common’. In its etymological origin, commonwealth means the wealth created more by the
common (the human capacity to share relations, skills, experiences, attention, etc. inside a social
cooperation) then by common goods (the governance of tangible and intangible goods which are
the basis of human existence and survive).
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With social re/production we mean the complex of interactions and exchanges that
are generated, in life, within the social environment. The content and the form of social
reproduction, more clearly than in the past, deals with the material body, processed by
bio-capitalism, and is inextricably linked to the time and the needs of life.3
Welfare institutions today have become directly productive activities (as opposed to
supportive reproductive activities). The share of capital understood as supportive of
immaterial wealth (R&D, education, training and health) has exceeded the share of
material capital as once accumulated in the traditional spaces such as factories and
oices. This became visible in the beginning of the 80s in the US, and later in Europe.
Nowadays, inancial capital has become the determining factor in growth and competitiveness. Material capital tends to turn into human capital (the stock of knowledge,
habits, social and personality attributes, including creativity, embodied in the ability
to perform labor so as to produce economic value). Thus, welfare, after it has been
privatized and inancialized, starts to serve inside the accumulation process as the primary productive factor. Market actors substitute states and public actors, resulting in
a process of segmentation among the population. As a result, universality has become
an empty word.
Traditionally, care work has been considered ancillary to the factory’s production work.
Now, in contemporary capitalism, it has become a direct source of value, partially
waged and partially unpaid.
Given the new phase of bio-capitalism, we propose to direct critical discourse in the
following ways:
1. we need to become aware of the forms of direct exploitation of both the human
body (organ transplants, surrogacy, …) and the earth, which increases the degree to which the biosphere can be commodiied (in part, thanks to innovations
in bio-technology);
2. we need to think about the consequences of ‘emotional’ care and afect as
productive labor, an aspect crucial to many professions in the service sector
(not only the teacher and the nurse but also the PR and the fashion/TV professional worker);
3. we need to relect on how social life, induced by cooperative forms of social
networks (Facebook, Twitter, YouTube), is also becoming productive labor;
4. we need to think about how water and health have become privatized. Social
reproduction is at the same time a collective and individual activity, since it
simultaneously deals with individual learning and social relations. Promoting oneself on LinkedIn, using Google and smartphone apps, participating in
Duolingo as life-long learning, liking on Facebook... The issue of exploitation
of re/production, and the becoming-invisible of domestic labor and care, is the
3.
For more details, see Morini Cristina, ‘Social Reproduction as a Paradigm of the Common.
Reproduction Antagonism, Production Crisis’, in O. Augustin, C. Ydesen (eds), Post-Crisis
Perspectives, Peter Lang, Frankfurt-New York, 2013, pp. 83-98
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contemporary mechanisms of reproduction and production that have dramatically expanded within the horizons voluntary work under neo-liberalism. The
expropriation of the value of social reproduction today represents the core of
accumulation in a capitalist production context. The governance of social reproduction, outside and beyond the commodiied logic of proit accumulation,
is the core of what the commonfare project addresses.4
The transformation of the labor market over the past two decades in Europe has
made increasingly urgent the need to redeine welfare policies. Therefore, it is necessary to introduce a new idea of welfare, what we call the commonfare (welfare of the
commonwealth). Through the commonfare concept we will be able to deal with two
elements that characterize the current phase of bio-cognitive capitalism, especially
in so-called Western countries:
– precarity and the debt condition as dispositive of social control and dominance;
– the generation of wealth that arises from social reproduction, cooperation and
general intellect.5
Labor is becoming more fragmented, not only from a legal point of view, but more
commonly from the qualitative and subjective point of view. There is a growing
multitude of atypical and precarious para-subordinate and autonomous workers.
The primacy of individual over collective bargaining empties the capacity for trade
unions to represent in the traditional way. Furthermore, in times of crisis, the pre-
4
5
The concept of commonfare originates from a debate in Italy during the struggle against
precarious conditions. The irst time the claim for commonfare appeared in a political document
was in Mayday Network Milano, ‘Charter of knowledge-workers rights’, European Institute for
Progressive Cultural Policies, May 2009, http://eipcp.net/n/124117049. From a theoretical point,
as stated by Tiziana Terranova, Carlo Vercellone, and Andrea Fumagalli, see Tiziana Terranova,
‘Red Stack Attack! Algorithms, Capital and the Automation of the Common’, Eimera, 12 February
2014, http://eimera.org/red-stack-attack-algorithms-capital-and-the-automation-of-thecommon-di-tiziana-terranova/; Andrea Fumagalli, ‘Trasformazione del Lavoro e Trasformazioni
del Welfare: Precarietà e Welfare del Comune (Commonfare) in Europa’, in Paolo Leon, Riccardo
Realfonso (eds), L’Economia della precarietà, Roma: Manifestolibri, 2008, pp. 159-174; Andrea
Fumagalli, ‘Commonfare: Per la Riappropriazione del Libero Accesso ai Beni Comuni’, Doppio
Zero, 14 January 2014, http://www.doppiozero.com/materiali/quinto-stato/commonfare; Carlo
Vercellone, Il comune come modo di produzione, Ombre Corte: Verona, 2017.
General intellect is a term that originates from Karl Marx. In his Grundrisse, General intellect
represents a crucial force of production, as a combination of technological expertise and social
intellect, or general social knowledge: ‘Nature builds no machines, no locomotives, railways,
electric telegraphs, self-acting mules etc. These are products of human industry; natural material
transformed into organs of the human will over nature, or of human participation in nature. They
are organs of the human brain, created by the human hand; the power of knowledge, objectiied.
The development of ixed capital indicates to what degree general social knowledge has become
a direct force of production, and to what degree, hence, the conditions of the process of social
life itself have come under the control of the general intellect and been transformed in accordance
with it; to what degree the powers of social production have been produced, not only in the
form of knowledge, but also as immediate organs of social practice, of the real life process’ (Karl
Marx, The Grundrisse: Notebook VII, 1858, https://www.marxists.org/archive/marx/works/1857/
grundrisse/ch14.htm). See also: Carlo Vercellone, ‘From Formal Subsumption to General Intellect:
Elements for a Marxist Reading of the Thesis of Cognitive Capitalism’, Historical Materialism, 15.1
(2007): 13–36.
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carious condition is strengthened by the increasing of the debt condition, in a vicious circle. The result is the ‘precarity trap’, which nowadays tends to substitute
the ‘poverty trap’.
As we stated before, the production of wealth is no longer based solely on material production. The existence of learning economies (which generate knowledge) and
network economies (which allow its difusion, at diferent levels) now represent the
key variables that are at the origin of the increases in productivity: a productivity that
comes from the exploitation of both common goods and the commonwealth, arising from the social cooperation of humans (such as in education, health, knowledge,
space, social relations, etc).
A redeinition of welfare policy should be able to respond to the unstable trade-of
inside the accumulation process of bio-cognitive capitalism: the negative relationship
between precarity and social cooperation under platform capitalism (such as Peerby,
Airbnb etc.). It is necessary to remunerate social cooperation, from one side, and favor
forms of social production, from the other.
Our commonfare proposal is based on four pillars:
First Pillar: Unconditional Basic Income
Basic income should be available for everyone who lives in the territory, regardless
of his/her professional and civil status, and should begin with the people under the
relative poverty threshold. Basic income should be understood as a kind of monetary
compensation (remuneration) of social productivity and of productive time which is
not certiied by the existing labor contracts. It occurs at the primary level of income
distribution (it’s a primary income), hence it cannot be considered merely as a welfare
intervention, according both to workfare and Keynesian logic. This measure must be
accompanied by the introduction of a minimum wage both for employees and freelancers, in order to avoid a substitution efect (dumping) between basic income and
the same wages in favor of irms and to the detriment of the employees. Basic income
together with minimum wage makes possible an expansion of the range of choices in
the labor market, i.e. to refuse a ‘bad’ job and then modify the same labor conditions.
The unconditional possibility of the refusal of labor opens up perspectives of liberation that go far beyond the simple distributive measure. Minimum wage for freelancers
should be introduced. The group of people doing freelance work is increasing rapidly.
For these people it is hard, if not impossible to join a union to ight for their rights. Individual bargaining leads often to too low wages for freelancers, which in their place will
lead to reduced wages for employees.
Conversely, traditional welfare is based on the fact that people get back to work regardless of the uselessness of the task performed. ‘Getting back on the horse’ (of
work) by doing obsolete or superluous work seems more important than staying at
home and maintaining the family. This is despite the fact that a well-cared for family reduces (future) costs of criminality, healthcare and poverty support, due to more space
for education and upbringing, more so than the current costs of poverty support. The
state of care has become a state of control. The fear of the state that people will stop
working when receiving an unconditional basic income is partly well founded in the
sense that people will stop doing unnecessary and meaningless jobs. Instead, many
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will get more education, before returning to do meaningful work. Others will spend
(part of their) time doing social work or other highly underrated, often voluntary, work
such as care for the elderly or needy.
Second Pillar: Managing Both Common Goods and Commonwealth
The idea of commonfare implies, as a prerequisite, the social re-appropriation of the
gains arising from the exploitation of common goods that are the basis of accumulation today. This re-appropriation does not necessarily lead to the transition from private
to public ownership. As far as basic services such as health care, education or mobility are concerned, the goal is to install public management of the use-value supply in
order to protect it against any attempt of commodiication and extraction.
But if we refer to the commonwealth, the framework is diferent, since the fruits of
social cooperation and general intellect are neither private nor public goods. The only
way to manage the commonwealth is through self-organization, by imagining a diferent régime of valorization.
Concerning common goods, the proposal of commonfare entails that:
– as far as the cognitive commonwealth (general intellect) is concerned, it is
able to reduce intellectual property rights and patent laws in favor of greater
freedom of the circulation of knowledge and the ability to acquire free information infrastructures; simultaneously, it should dismantle all social and monetary
barriers to a free, autonomous and universal education (access to immaterial
common goods);
– as far as social re-production is concerned, it is able to provide free basic conditions of health, housing, mobility, transport and sociality, by improving good
practices to experiment in new forms of self-organized welfare from below (access
to the self-organization of life);
– it is able to be free from the hierarchy imposed by economic oligarchy, commodities and utilities. Over the past 20 years, these have been subject to extensive
privatization as a consequence of the Cardif process6 on the regulation of the
market for goods and services (access to material common goods);
– it is able to provide institutions of the common, at the local level, regarding essential goods such as water, energy, housing stock, and environmental sustainability,
through forms of ‘municipalism’ from below (democratic principle).
Third Pillar: Alternative Sharing Economy
We need to ofer accessible alternatives against the negative externalities of the
capitalist sharing economy, which include: (1) the generation of relations between
users as the cornerstone of digital sharing platforms, and (2) the ownership of whatever physical asset is being shared. The second point even has scarier implications
than the irst if we start to imagine a full-ledged capitalist sharing economy. This
6
The Cardif process is a reference to the 1996 European Treaty about the liberalization of public
utilities inside the European Union in order to ease the constitution of Monetary European Union.
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would be an economy in which ‘everything is shared and nothing is owned’. This
is already a nerd dream in which there is a hope for ‘sharing power tools’. What a
poor, nurtured dream! We can do better than that and instead really need to open
our collective imaginaries.
Fourth Pillar: Commoncoin
Commonfare presupposes autonomy and independence, so it requires the activation
of processes of self-organization or self-governance. The development and implementation of good practices requires a test-bed of experimentation and is therefore
not always productive. To this end, it is essential to ensure full economic sustainability in order to avoid subsidence processes. From this point of view, commonfare
presupposes its own self-capitalization in the direction of growing and widespread
alternative productions, aimed at producing use-value instead of exchange-value. It
follows that commonfare can be inancially autonomous only if it is placed within a
monetary circuit which is in turn independent from diktat and the imposition of dominant inancial conventions.
Commoncoin is therefore the expression of commonfare and deines the framework
of its implementation. Commonfare justiies Commoncoin when this currency is
functional to an alternative production context based on the production of human
beings for human beings. Commoncoin is designed to take care of the relation
between bio-political value produced by the singularities composing the multitude
and the social relations necessary to produce such value. At the economic and
monetary levels, this self-reinforcing process needs then to be organized with the
implementation of a set of monetary tools that can help answer the following question: how can the processes that deine diferent redistributive models be automated with digital technologies, starting from a platform made to share bio-political
value production by and for the multitude?
Capital is not keen to let the multitude enact the exodus from its yoke. Therefore, the
underlying assumption for the creation of a complementary crypto-currency such as
Commoncoin emerges from the need to enable the multitude to ight against monetary
bio-power in the process of an exodus by weaponizing money itself. In reality, this
may happen through bottom-up initiatives that apply critical thinking to crypto-currency design for the common good of the multitude. Hence, if implemented as cryptocurrencies on distributed ledgers, the Commoncoin crypto-currency system could be
operated at a fraction of the cost of both current public welfare provisions in that
disintermediation and transaction costs near to zero would make them more attractive
for the bottom-up institutionalization of commonfare. More concretely, Commoncoin is
thought of more as a means of exchange to low in alternative economic circuits than
a store of value for ordinary crypto-currencies.
Commonfare, thanks to the growth of the service sector, could favor the spread of
alternative forms of production, compatible with environmental constraints, respectful of human nature and above all aimed at valorizing the creative activity of otium
(leisure) and opus (work) against today's dictatorship of labor: a dictatorship based
on performance eiciency, productivity for capital, and with the result to destroy any
social and natural ties.
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Commonfare, therefore, is also adapted to the ecological constraints that emerged after more than 50 years of the Taylorist eiciency regime. This can be done according to
two guidelines. The irst concerns a ‘common’ management of environmental goods,
subject to scarcity, from air to water, to nature in general (forests, animals, seas, and
so forth), from one side, and of social reproduction and human relationships, from the
other. The second derives from the implementation of an unconditional basic income
which, in the name of the right of choice and self-determination of one’s own life, can
favor eco-compatible value-generation against production which damages environmental equilibrium.
Commonfare implies an ad hoc economic policy for a better governance of the
present phase of what has been termed the ‘capitalocene’. Since the dimension of
life is the core of the processes of accumulation and exploitation and thus of valorization, welfare conditions are today the elements that condense these issues as a
mode of production.
Commonfare intends to overcome the imperative of contemporary pessimism, connected with the current processes of impoverishment and proletarianization of the
general intellect, by creating new imaginaries. Its aim is to develop concrete forms of
micro-politics able to valorize presence and the capacity of diferent talents, the richness of human exchanges. It should also be able to adapt, at least partially, production
to the needs and desires of the community. The metropolitan and social spaces, the
relations between individuals and communities, the engines of valorization and the
means of production are already directly in our hands, bodies and minds.
To get out of paralysis, we can already map out an ininity of realities that build ‘commonwealth’, social cooperation, self-production, inventions on the ground of social reproduction and inclusive exoduses. Such mapping is to begin to imagine the contours
of a desirable society.
References
Fumagalli, Andrea. ‘Trasformazione del Lavoro e Trasformazioni del Welfare: Precarietà e Welfare
del Comune (Commonfare) in Europa’, in Paolo Leon, Riccardo Realfonso (eds), L’Economia della
precarietà, Roma: Manifestolibri, 2008.
_____, ‘Commonfare: Per la Riappropriazione del Libero Accesso ai Beni Comuni’, Doppio Zero, 14
January 2014, http://www.doppiozero.com/materiali/quinto-stato/commonfare.
Marx, Karl. The Grundrisse: Notebook VII, 1858, https://www.marxists.org/archive/marx/works/1857/
grundrisse/ch14.htm.
Mayday Network Milano. ‘Charter of knowledge-workers rights’, European Institute for Progressive
Cultural Policies, May 2009, http://eipcp.net/n/124117049.
Terranova, Tiziana. ‘Red Stack Attack! Algorithms, Capital and the Automation of the Common’, Efimera, 12 February 2014, http://eimera.org/red-stack-attack-algorithms-capital-and-the-automation-of-the-common-di-tiziana-terranova/.
Vercellone, Carlo. ‘From Formal Subsumption to General Intellect: Elements for a Marxist Reading of
the Thesis of Cognitive Capitalism’, Historical Materialism, 15.1 (2007).
_____. Il comune come modo di produzione, Ombre Corte: Verona, 2017.
APPENDICES
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EDUARD DE JONG, GEERT LOVINK
AND PATRICE RIEMENS
Amsterdam, November 2015
Pigs will ly, but not in the next 100 million years.
—Johan Sjerpstra
1. ‘Bitcoin is a Peer-to-Peer System.’
In order to transfer value from one Bitcoin account to another, the owner of bitcoins
uses the services of a collective of operators known as ‘miners’ who validate the transaction on the Bitcoin distributed database also known as ‘the ledger.’ The relationship
between these operators and an individual user, i.e. owner of bitcoins, is hence one
between merchants and customer and not one of equals. Only miners are, and then
only operationally speaking, peers, since they all perform the same software program.
However, they are also, and mostly, in competition which each other because they
need revenue to pay for the equipment they operate. Also, any time an update to the
database is made, only a single miner is actually adding the transaction records with
Bitcoin value transfers to the ledger, and gets the inancial rewards for doing this. In
this way, the incentive for miners to support each other is limited, and one cannot
speak of a peer-to-peer relationship in the traditional sense.
Over the time Bitcoin has been operational the inherent hierarchical relation between
miners and users has become more pronounced by an ever rising technical and inancial barrier to becoming a miner. Investments and operating costs of the necessary
equipment rise in tandem with the continuously increasing diiculty of adding a new
record to the database that is built into the Bitcoin protocol.
Conclusion: Bitcoin is not a peer-to-peer system, but an online merchant-customer
transaction market place.
2. ‘Bitcoin does Away with Intermediaries and Fees.’
To make a payment using bitcoins a Bitcoin user needs a ‘Bitcoin exchange’ and these
exchanges charge a fee. The sole exception is if the user is a data base operator (a.k.a
miner), having aggregated some bitcoins by mining and exclusively pays other users
who have decided to accept and keep bitcoins.
There is an other intermediary in Bitcoin, the operators of the distributed data base,
the Bitcoin miners. A miner also needs to charge for its labor and expenses. For the
time being, a miner is rewarded with newly created bitcoins, that is why updating the
database is called ‘mining’. By design, the available amount of bitcoins that can be
mined is restricted, and it is expected to be exhausted somewhere around 2040. After
exhausting the lode miners can only earn money by explicitly charging a fee.
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Conclusion: De-facto, Bitcoin users need to engage services of intermediaries and do
pay fees for their transactions.
3. ‘Bitcoin is an Alternative Currency.’
An alternative currency, by deinition, is designed to _entirely_ displace and replace existing currencies. Complementary currencies intend to _partially_ displace and replace
existing currencies, usually in a local setting.
By design, Bitcoin is an alternative currency. Real world observation however, shows
that most transactions in bitcoins translate, either at the point of purchase, or at the
point of sale, in transactions in existing currencies. Only miners can create bitcoins,
non-miners need to acquire them, usually by way of purchase.
In practices Bitcoin transactions are often intended to avoid high transfer fees or bypass local restrictions in making international payments. In such cases, bitcoins are
purchased, swiftly change hands, and are just as fast converted again in another currency. In this ‘cash-in cash-out’ scheme Bitcoin operates then as a facilitator in the
circulation of existing currencies and not as a replacement of these. Cash-in cash-out
has been shown the most common mode of operation in bitcoins. A Bitcoin transaction
can also be speculative in purpose, to hoard bitcoins expecting a raise in their value.
In this case Bitcoin can be considered an alternative to other currencies, comparable
to a speculative investment in dollars or in commodities, like iron ore, gold or grain.
Conclusion: Bitcoin does not actually operate as an alternative currency.
4. ‘Bitcoin is Not a Fiat Currency.’
In practice, acceptance of Bitcoin payments takes place before the (irrevocable) recording of the transaction in the distributed database. That is, without formal conirmation of its validity. Apparently, the parties involved in payments in bitcoins _believe_
in their eventual recording. The payee therefore trusts the _eventual_ availability of
received funds.
This looks distinctly similar to the way traditional instruments of payments, such as
coins, banknotes and bank transfers, operate. The users trust, based on experience
and social convention, the correct operation of the system such that received funds
are available for further spending. This ‘systemic trust’ in traditional, iat, currency is
underpinned by a mix of technical features such as hard to copy bank notes, fraud
detection software in inancial institutions and government imposed and enforced
regulations.
Conclusion: Where in practice the ‘systemic trust’ in Bitcoin is no diferent from that of
traditional currencies, Bitcoin operates _de facto_ as a iat currency.
5. ‘Bitcoin is Anonymous.’
The central database with transactions in bitcoins is publicly accessible. This is an essential Bitcoin design property to, at least in theory, allow any party to participate as
processing node (miner) in order to get involved in updating the distributed database.
The parties in a transaction are identiied by unique numbers, and a payment transaction
is linked through this number to the transaction wherein the spend value was received.
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But as most Bitcoin transactions efectively constitute a payment in traditional currency at one end or the other, or both, they involve well known parties that exchange bitcoins for and against these currencies, the Bitcoin exchanges. Hence,
payments in bitcoins can be traced as the value lows between these exchanges.
Identiication to the humans involved in a payment, e.g. by law enforcement, are
therefore _potentially_ possible.
Conclusion: Bitcoin is not an electronic form of cash and does not protect privacy.
6. ‘Bitcoin is Secure and Cannot Be Hacked.’
Security for electronic payments has several parts: irst to make sure that only the
rightful owner can make a payment, secondly to make sure that the intended recipient
actually receives the moneys paid and inally that only money can be paid that is actually owned by the payer and hence can not be spend twice.
In the Bitcoin sphere a payer uses a password to initiate a payment from her computer.
The password unlocks a private cryptographic key stored on the computer to send
cryptographically protected messages to be recorded in the Bitcoin database to make
the payment. Yet, computers can be hacked, and a hacker can gain control of the private key and hence initiate a fraudulent payment. A loss of the private key, for instance
by a crashed hard disk, does not just lose access to the money, it actually loses all the
moneys controlled. Indeed one of the design features of Bitcoin is that payments, once
made, cannot be reversed or recalled.
For the ordinary user, this represents a much higher level of risk than in traditional
banking, where losing the bank card or PIN does usually not result in losing the whole
balance held in the bank account.
On the functional side, the operators of the processing nodes in the distributed implementation of the shared Bitcoin database use a protocol to agree on the next version
of the database. This is required to correctly incorporate the payment transactions
made since the last update. The software in each of the processing nodes must verify the correctness of the transactions by inspecting previous transactions where the
payer has received the value to be spend. Yet, servers can be hacked (e.g. with a virus)
and the continued operations can therefore not be guaranteed.
By design, the blockchain protocol does not guarantee that all past transactions remain stored for ever or can be available to each of the processing nodes (miners) for
inspection in a fail-safe way. The protocol does also not guarantee that a processing
node actually veriies the transactions it records. The blockchain protocol cannot prevent that fraudulent transactions get recorded, and does not provide a way to remove
or correct fraudulent transactions.
Conclusion: using Bitcoin is more risky than the traditional payment infrastructure.
7. ‘Bitcoin Operates Without Trust.’
Bitcoin literature is adamant that the Bitcoin set-up successfully substitutes ‘objective’
‘algorithmic’ trust for less reliable, because human error and trickery-prone, ‘subjective’ institutional or political trust.
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As described previously, the blockchain protocol used to synchronize updates to the
Bitcoin central database (or ledger) does not guarantee the correctness of the updates
made. Most processing nodes that update the database, use the same open source
implementation, the Bitcoin ‘miner’ program. This program includes veriication of
transactions, but transaction veriication by the miner program might be compromised
either accidentally, by a software bug, or maliciously, e.g. by a virus, or by a miner
intent on undue gains. Users engaging in Bitcoin transactions implicitly trust that the
miner programs continues to operate correctly, that the equipment is protected against
virus attacks and that the miners will not subvert it.
Also, protection of the stored value at the level of the individual owner is not very strong
in the Bitcoin set-up. As a consequence, Bitcoin service providers have emerged offering enhanced payment security, in the form of managing their clients’ wallets. This
service can be provided both online and with physical tokens like smart cards. Making
use of ‘wallet providers’ evidently entails trust in the continued correct and honest
operations of the online service or of the physical device.
Conclusion: Bitcoin substitutes one form of ‘subjective’ trust in traditional institutions
for another in new organizational forms.
8. ‘Bitcoin is Politically Neutral.’
British prime minister Margaret Thatcher, in a famous ‘last words’ speech against the
Euro, airmed that decisions about money and currency are all essentially political in
nature. In this context politics must be understood as more than what politicians do,
essential politics is about the citizens and the state they live in. The decision that is
embodied in Bitcoin’s design to limit the issuable volume of bitcoins to 21 million units
can only be seen as political.
Other characteristic Bitcoin features, such as it rewards for early adopters and big
operators, its essentially delationary and hoarding-inducing nature (also due to the
designed scarcity of bitcoins), its rejection of regulatory oversight and consumer protection and of state intervention generally, all resonate with political beliefs of ‘technolibertarians’. Conversely, it is diicult to imagine how Bitcoin could efectively function
in a capitalism-unfriendly political dispensation.
Conclusion: like any other monetary system, Bitcoin, in its technical design relects
explicit or implicit political choices.
9. ‘Bitcoin is a Sustainable System.’
The whole Bitcoin set-up is, and especially the functioning of the distributed implementation of its central database with the compute-intensive blockchain protocol,
is dependent on increasingly sophisticated and trouble-free network infrastructure
resulting in an ever increasing consumption of resources. This clearly is at variance
with the ever more forceful, and inescapable calls for less consumption, foremost in
the energy sector.
Conclusion: Bitcoin does not it well in the required transition to sustainability. This
contrasts with traditional inancial institutions that can reduce energy consumption a
pace with improvements in IT technology.
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10. ‘Bitcoin Can Scale to World Size.’
Both the limited number of possible units of bitcoins and inherently severe technical
limits to the operational speed of the blockchain protocol pose such insurmountable
obstacles to a global economy that would run exclusively with bitcoins. In the absence
of governance of Bitcoin, even a technical modiication to increase transaction capacity are very hard to implement.
For consumer payment transactions, for instance, it is hard to conceive how the blockchain protocol in Bitcoin can be made to operate efectively at the same speed and
volume as systems maintained by, e.g., VISA, Mastercard, AmEx, JCB and such.
As shown in Argentina or Greece Bitcoin can be useful in some speciic situations. In
these cases it has been a mediator between traditional monetary systems. For Bitcoin
to ‘scale up’ to a true global scale, while maintaining (a semblance of) stability and
security would for quite some time to come require such large amount of resources as
to defeat any short or medium term perspective of attainability.
Conclusion: As Yanis Varoufakis, the economist and former inance minister in Greece,
formulated it: ‘Bitcoin is not capable of “powering” an advanced, industrial society.’
—
The authors thank Boudewijn de Kerf for a quick review, while keeping full responsibility for the substance of the argument.
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MONEYL B CONFERENCE #2:
ECONOMIES OF DISSENT
3–4 December 2015 — Pakhuis de Zwijger, Amsterdam
THURSDAY, 3 December 2015
Session 1: Blockchain: Revolution or Business as Usual
Moderator: Eduard de Jong
Speakers: Primavera De Filippi, David Golumbia, Bruce Pon
Session 2: Free Money Movement and the Commons
Workshop by: Jim Costanzo
Session 3: Avenging Money
Workshop by: Max Haiven
Session 4: Negotiating Trust on Crowdfunding Platforms
Workshop by: Robert van Boeschoten
Session 5: Artistic Interventions in Finance
Moderator: Max Haiven
Speakers: Núria Güell, Levi Orta, Silvio Lorusso, Stephanie Rothenberg, Scott Kildall,
DullTechTM
FRIDAY, 4 December 2015
Session 6: Bringin the Dark Side of Money to Light
Moderator: Cecile Landman
Speakers: Paul Radu, Femke Herregraven, Paulo Cirio
Session 7: Building an Ownership Layer for the Internet
Workshop by: Ascribe
Session 8: Peerhood Gaming
Workshop by: Pekko Koskinen
Session 9: Commoneasy P2P Insurance
Workshop by: Jip & Florian de Ridder
Session 10: Tactics for Economic Dissent
Moderator: Brett Scott
Speakers: Enric Duran, Rachel O'Dwyer, Robin Hood Minor Asset Management
Exhibition: Trading Floor
Artists: Gordana Nikolić, Šeik Tatlić, Scott Kildall, Rob Myers, Aline Baggio
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A
MONEYL B CONFERENCE #3:
FAILING BETTER
1–2 December 2016 — Pakhuis de Zwijger, Amsterdam
THURSDAY, 1 December 2016
Session 1: Global Finance: Failing Better?
Moderator: Geert Lovink
Speakers: Alex Foti, Menno Grootveld, Renzo Martens, Cassie Thornton
Session 2: When Art Mirrors Marx
Moderator: Stephanie Rothenberg
Speakers: Steyn Bergs, Dan Mihaltianu, Tori Abernathy, Jeroen van Loon, Anne Breure
Session 3: How Can Accountants Save the World?
Workshop by: Frank de Graaf, Nick McGuigan, Thomas Kern, Herman Gels
Session 4: Politics of the Cyphersphere: After the Blockchain Revolution
Workshop by: Matthias Tarasiewicz, FIBER
Session 5: Prevailing over Money
Workshop by: Dmytri Kleiner, Baruch Gottlieb
Session 6: Save the Last Dance?
Moderator: Max Dovey
Speakers: Henry Warwick, Koos Zwaan, Bindu de Knock
Evening Program: Fiscal Drag Live
Performers: Max Haiven, Cassie Thornton, Fine Art Financ€ Lab, Tori Abernathy
FRIDAY, 2 December 2016
Session 7: Cooperatives and the Commons
Moderation: Sabine Niederer
Speakers, Trebor Scholz, Arthur Röing Baer, Michel Vogler
Session 8: Big Pocket is Watching You!
Moderation: Patricia de Vries
Speakers: Brett Scott, Nathalie Maréchal, Emily Rosamond, Austin Houldsworth
Session 9: Governance in the Age of Blockchains and Digital Currencies
Workshop by: Richard Khol
Session 10: Flexonomix District Currency Game
Workshop by: Jens Martignoni, Panayotis Antoniadis, Ileana Apostol
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Session 11: Role Play Your Way to Budgetary Blockchain Bliss
Workshop by: Ruth Catlow, Ben Vickers
Session 12: Universal Basic Income: For One and for All
Moderator: Tori Abernathy
Speakers: Johannes Ponader, Baruch Gottlieb, Patrice Riemens
Exhibition: No Hidden Costs
Artists: Steve Rowell, Fine Art Financ€ Lab, Arthur Röing Baer, Javier Lloret, Oliver
Barstow, Luca Claessens, Nicoleta Pana, Pete Gomes, Ruth Catlow, Max Dovey
A
MONEYL B LONDON:
ART, CULTURE AND FINANCIAL ACTIVISM
20 January 2018 — Somerset House Studios, London
SATURDAY, 20 January 2018
Session 1: Ofshore Investigation Vehicle
Workshop by: The Demystiication Committee
Session 2: Patternist
Workshop by: Kei Kreutler
Session 3: Playing to Lose: Exploring Strategy, Simulation and Scenario Gameplay in
Art and Finance
Moderator: Brett Scott
Speakers: The Demystiication Committee, Kei Keutler, Stephanie Polsky
Session 4: FairCoop - Earth’s Cooperative for Economic Fairness
Workshop by: FairCoop
Session 5: Data Workers Union
Workshop by: Institute of Human Obsolescence
Session 6: Art and Equity? Tokenizing Culture with the Blockchain
Moderator: Ruth Catlow
Speakers: Jérôme Croisier, Rachel O’Dwyer, Sarah Friend, Marija Bozinovska Jones
Session 7: The INC presents MoneyLab Reader 2: Overcoming the Hype
Moderator: Inte Gloerich
Speakers: Geert Lovink, Emily Rosamond, Nathaniel Tkacz
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AUTHOR BIOGRAPHIES
Jaya Klara Brekke is a writer, researcher and creative producer currently focusing on
the political economy of blockchain, consensus protocols and issues of governance,
agency, ethics and power in distributed systems. She is based in London and is writing
a PhD at the Geography Department of Durham University.
Tripta Chandola is an urban ethnographer based in Delhi. In her research experience, spanning more than ifteen years, she has explored the diferent facets of the
everyday of the lives of those living on the margins through diferent tropes and lens
of engagement. She received her PhD from Queensland University of Technology,
Australia. She has published several journal articles, contributed to book chapters
and co-produced a BBC radio documentary titled ‘Govindpuri Sounds’ based on her
doctoral research. Her book, A Sense of the Others, will be published in 2018 with
INC, Amsterdam. Presently she is Post-Doctoral Fellow at Indian Institute for Human
Development, Delhi, India.
Economic Space Agency is a team of inance theorists, political scientists, software
architects, game designers, artists, lawyers, peer production experts, philosophers,
decentralized application engineers working together to reimagine and operationalize
what economic spaces can be.
Max Dovey can be described as 28.3% man, 14.1% artist and 8.4% successful. He
is also an artist, researcher and lecturer specialising in the politics of data and algorithmic governance. His works explore the political narratives that emerge from technology and digital culture and manifest into situated projects – bars, game-shows,
banks and other participatory scenarios. He is an ailiated researcher at the Institute of Network Cultures and writes for Open Democracy, Imperica & Furtherield.
His work has been performed at Ars Electronica Festival, Art Rotterdam & many UK
based music festivals.
General Intellect is an ephemeral collective that exists today and no longer tomorrow.
It deals with issues related to new processes of valorisation, social reproduction, welfare, income distribution (unconditional basic income) and alternative monetary forms,
mainly composed by activists and co-researchers.
Inte Gloerich is a researcher and project coordinator for MoneyLab at the Institute
of Network Cultures, Amsterdam. She has a background in media studies, holds an
MA in New Media and Digital Culture from the University of Amsterdam, and has
participated in various research projects on the politics of digital technology, digital
economy, and online identity.
Max Haiven is Canada Research Chair in Culture, Media and Social Justice at Lakehead University in Northwest Ontario and director of the ReImagining Value Action Lab
(RiVAL). He writes articles for both academic and general audiences and is the author
of the books Crises of Imagination, Crises of Power: Capitalism, Creativity and the
Commons, The Radical Imagination: Social Movement Research in the Age of Austerity
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(with Alex Khasnabish), and Cultures of Financialization: Ficticious Capital in Popular
Culture and Everyday Life. He is currently working on a book titled Art after Money,
Money after Art: Radical Creative Strategies Against Financialization.
Robert Herian is a lecturer in law at The Open University, United Kingdom. His teaching and research interests focus on the laws of equity, trusts, property and iduciaries
and how those laws both shape and are shaped by sociocultural, political, economic,
psychological and technological ideas and practices.
David Hollanders is a historian and econometrist. He has a PhD in economics from
Tilburg University, in which he focussed on pension fund governance. He currently
teaches political economy for European Studies at the University of Amsterdam.
Dmytri Kleiner is the author of The Telekommunist Manifesto and a contributing artist
to Miscommunication Technologies, a continuing series of artworks in collaboration
with the Telekommunisten Network. Miscommunication Technologies addresses the
social relations embedded in communications technologies by creating platforms that
don't quite work as expected, or work in unexpected ways.
Silvio Lorusso is a Rotterdam-based artist, designer and writer. His writing has appeared in several magazine and publications, including Not, Immaterial Labour Union
Zine, Prismo, Modes of Criticism, Printed Web 3, Metropolis M, Progetto Graico, Digicult, Diid, and Doppiozero. He is an ailiated researcher at the Institute of Network
Cultures of Amsterdam and works as a mentor at the Amsterdam University of Applied
Sciences’ PublishingLab.
Laura Lotti is an independent researcher and practitioner investigating blockchain
cultures. With a background in economics, media studies and philosophy, Laura completed her PhD at UNSW, Sydney, in 2016, exploring the technological, economic, social and political afordances introduced by blockchain protocols and smart contracts.
She is now furthering her research through her collaboration with the Economic Space
Agency, a start-up based in Oakland and around the world building a truly peer-to-peer
smart contracts ecosystem to power socially networked production.
Geert Lovink is a Dutch media theorist, internet critic and author of Uncanny Networks (2002), Dark Fiber (2002), My First Recession (2003), Zero Comments (2007),
Networks Without a Cause (2012) and Social Media Abyss (2016). In 2004 he founded
the Institute of Network Cultures at the Amsterdam University of Applied Sciences.
Nathalie Maréchal is a scholar-activist working at the intersection of internet policy
and human rights and a PhD candidate in Communication at the University of Southern California. Her work focuses on corporate accountability for human rights online,
social justice and inequality in the digital age, and the geopolitics of information. Nathalie’s forthcoming dissertation traces the political history and bureaucratic politics of
Internet Freedom funding while critically assessing U.S. foreign policy and its relationship with the transnational social movement dedicated to digital rights.
Rachel O’Dwyer is a Research Fellow in CONNECT, Trinity College Dublin. Her research focuses on emerging markets at the intersection of data, mobile networks and
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payments. She is the leader of the Dublin Art and Technology Association (DATA) and
the curator of the festival and conference Openhere.
Nina Power received her PhD in Philosophy from Middlesex University on the topic of
Humanism and Anti-Humanism in Post-War French Philosophy, and also has an MA
and BA in Philosophy from Warwick. She has taught at Middlesex, Orpington College,
London College of Communication, Morley College and The University of Roehampton, where she is also currently a Senior Lecturer in Philosophy. She is a fellow of the
RSA and a member of the British Philosophical Association. She is the author of OneDimensional Woman (Zer0, 2009) and Das kollektive politische Subjekt – Aufsätze zur
kritischen Philosophie (Laika, 2015), a collection of her philosophical writings (translated into German).
Patricia Reed is an artist, writer and designer based in Berlin. As an artist, selected exhibitions include those at The Museum of Capitalism, Oakland; Homeworks 7, Beirut;
Witte de With, Rotterdam; HKW, Berlin; and Württembergischer Kunstverein, Stuttgart.
Recent writings have been published in e-lux Architecture; _AH Journal; Cold War
Cold World (Urbanomic); Reinventing Horizons (Tranzitdisplay); and The Neurotic Turn
(Repeater Books). Reed is part of the Laboria Cuboniks (techno-material feminism),
and Oice for Applied Complexity working groups.
Patrice Riemens: geographer, culture and internet activist, advocate of Free and/or
Open Source Software, and member of the Dutch hackers club Hippies from Hell.
Emily Rosamond is a Canadian artist, writer and educator. She completed her PhD
in 2016, as a Commonwealth Scholar in Art at Goldsmiths, University of London. She
is Lecturer in Visual Cultures at Goldsmiths, and Joint Programme Leader on the BA
Fine Art & History of Art. She exhibits individually and with the collective School of The
Event Horizon.
Trebor Scholz is a scholar-activist and Associate Professor of Culture & Media
at The New School in New York City. He frequently presents on the future of work
and alternative economic models to policymakers, cooperators, scholars, lawyers,
activists, designers, union leaders, and technologists worldwide. His book Uberworked and Underpaid (Polity, 2016) starts with a critical analysis of the extractive
platform economy to then introduce the intellectual framework of "platform cooperativism." Scholz also co-edited the Ours to Hack and to Own (OR Books, 2016).
He is the founding director of the Platform Cooperativism Consortium. Learn more
at http://platform.coop.
Brett Scott is a journalist, campaigner and the author of The Heretic’s Guide to Global
Finance: Hacking the Future of Money (2013). He works on inancial reform, alternative
inance and economic activism with a wide variety of NGOs, artists, students and startups, and writes for publications such as The Guardian, New Scientist, Wired Magazine
and CNN.com. He is a Senior Fellow of the Finance Innovation Lab, an Associate at
the Institute of Social Banking and an advisory group member of the Brixton Pound.
He tweets as @suitpossum.
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Nathaniel Tkacz is Reader in Digital Media at the Centre for Interdisciplinary Methodologies at the University of Warwick. His work investigates the political, economic and
organizational dimensions of digital media. He is author or editor of a number of books,
including Wikipedia and the Politics of Openness (University of Chicago Press, 2015)
and The Moneylab Reader (2015) with Geert Lovink and Patricia de Vries.
Pablo R. Velasco is an Early Career Researcher at the Institute of Advanced Study and
a PhD Candidate at the Centre for Interdisciplinary Methodologies, University of Warwick. His research critically explores digital culture through its technical infrastructures,
in particular the rationale behind blockchain design and the interwoven relations between authority, space, politics, and cryptocurrencies’ distribution of power. His work
can be found at pablov dot me.
Patricia de Vries works as a PhD researcher at Erasmus University Rotterdam and
as a lecturer and researcher at the Institute of Network Cultures in Amsterdam. She
reads and writes about algorithmic anxiety in the arts. More about her can be found at
networkcultures.org/contesting-capture-technology.
Martin Zeilinger is a London-based new media researcher, curator, and practitioner.
He is Senior Lecturer in Media at Anglia Ruskin University (Cambridge), co-organiser of
the 2018 London MoneyLab, co-curator of the Toronto-based Vector New Media Arts
Festival, and co-convener of the Digital Art Research Group at Cambridge University.
His research focuses on links between digital art and inancial technologies, and extends to practice-based work in creative coding and physical computing.
Co-funded by the
Creative Europe Programme
of the European Union