[p2p-research] “Philanthrocapitalism”: An oxymoron with promise?

Wed Apr 30 05:16:12 CEST 2008

Hi Sam,

I think your critique is spot on. While this kind of money is obviously
welcomed by those who receive it, it is no substitute for either a
democratic, or a self-aggregation/mobilization of resources

I seem to have no access to p2p foundation resources here in thailand today,
so can't add any note to the blog for now,

Michel

On Tue, Apr 29, 2008 at 9:32 PM, Samuel Rose <samuel.rose at gmail.com> wrote:

> Dear colleagues, would love your thoughts/opinions/criticisms/insights
> about this:
>
>
>
> http://blog.p2pfoundation.net/philanthrocapitalism-an-oxymoron-with-promise/2008/04/29
>
> Writer Micheal Edwards' recent book http://www.justanotheremperor.org/takes a critical look at the hype surrounded the emerging phenomenon that
> some are calling "philanthrocapitalism": using business and market systems
> to affect social change. The main criticism from Edwards can be summed up in
> his opendemocracy.net article<http://www.opendemocracy.net/article/globalisation/visions_reflections/philanthrocapitalism_after_the_goldrush>
> :
>
> *"My worry is that the hype surrounding philanthrocapitalism<http://bookshop.blackwell.com/jsp/id/Philanthrocapitalism_How_the_Rich_Are_Trying_to_Save_the_World/9781596913745>will divert attention from the deeper changes that are required to transform
> society, reduce decisions to an inappropriate bottom line, and lead us to
> ignore the costs and trade-offs involved in extending business principles
> into the world of civil society and social change. I'm concerned that these
> questions, and the evidence that underpins them, are not being given a fair
> hearing. And I want to provoke a conversation in which different positions
> can be aired and listened to. The only way that philanthrocapitalism will be
> able to fulfill its considerable potential is by moving beyond the hype."*
>
> Mohammed Yunus <http://en.wikipedia.org/wiki/Muhammad_Yunus> has also
> recently written a book that looks at how Social Enterprise can affect
> change. Yunus argues:
>
> *"The social business dollar is much more powerful than the charity dollar
> [..] Whereas the charity dollar can be used only once, the social-business
> dollar recycles itself again and again, ad infinitum, to deliver benefits
> to more and more people."*
>
> Although, I'll also point out that Social Entrepreneurship is *different *than
> "Philanthrocapitalism". Social Entrepreneurship as discussed by Yunus covers
> many scales, from small to large business. While, "Philanthrocaptialism" is
> defined by Edwards as:
>
>    - * "Resources: very large sums of money being committed to
>    philanthropy, mainly the result of the remarkable profits earned by a small
>    number of individuals in the IT and finance sectors during the 1990s and
>    2000s.*
>    - *Methods: a claim that methods drawn from business can solve
>    social problems, and are superior to the other approaches used in the public
>    sector and in civil society.*
>    - *Achievements: a claim that these methods can achieve the
>    transformation of society, rather than increased access to
>    socially-beneficial goods and services - a noble goal for sure, but
>    insufficient to lever deeper changes in the distribution of power and
>    resources across the world." *
>
>  Both Edwards and Yunus appear to be right, in my estimation. Yunus is
> right that there is much power in entrepreneurship, in the freedom to create
> wealth for yourself and others. Yet, Edwards is right that (in my words)
> there is also a huge machine, which is a combination of broadcast media
> corporations, and a plethora of big businesses and wealthy people around the
> world, that seek to co-opt social emergences, so as to funnel money, human
> energy, and control over domains *towards their market corrals*.
>
> This is nothing new. With every social movement, from the early 1960's, to
> the "creative class" of the early 2000's, there have been people trying to
> capitalize on,  and co-opt the symbols and energy of emergent social
> movements. (see http://www.press.uchicago.edu/Misc/Chicago/259919.html for
> a look at the origins of the phenomenon). Social entrepreneurship, or
> "philanthrocapitalism" is really no different. When a social phenomenon
> starts out in a "democratized" way (as they often actually do), meaning that
> *most, or all of the building blocks are  already present for individuals
> to participate in self-sustaining ways, *that would let people bypass or
> obsolete their need for mass pre-produced solutions, the big companies must
> act to keep people buying something, or risk being obsoleted from their
> lives. This basically means that corporate spending of public money is sold
> to the public as a project to make it easier for them to be more "creative",
> more socially or environmentally responsible, or more philanthropic. This, I
> believe is the danger that Edwards is warning us about. That we'll just
> leave it up to "business" to take the lead in social enterprise.
>
> The problem is that when we leave social transformation to business, we
> end up with a society that is structured by the principles of business
> management.  Edwards's book contends that there is evidence that the mission
> "drifts" away from social change, and towards profit, efficiency, and
> sometimes corruption. What is lacking in these situations is a *social *basis
> for *social change.*
>
> The market, and while being a powerful force, is no basis for sustainable
> social change. The atomization of business infrastructure to an individual
> level is but one building block towards real social change that is enabled
> in part by social enterprise. *The next step is the atomization of social
> infrastructure. People must learn to cooperate and collaborate together in
> equitable ways. People must learn to co-manage common infrastructure, and
> common resources in a democratic and transparent way. *Accessing and
> employing the efficient production and distribution systems of business and
> the market is not enough. *Those who rely on those systems must also have
> co-control of them.*
>
> This means that everyone in the "chain" gets a say, from
> grower/builder/laborer, to the person that buys a finished product. This
> means that a person's "job" is not just to specialize in being a lawyer,
> baking bread, or hauling garbage, but also in direct civic participation and
> oversight of the systems that feed, clothe, and house you. How can you know
> that the companies your are buying from, or are employed by, are working
> equitably?  You are involved in making sure that they are. Adam Arvidsson's Valuing
> the Ethical Economy <http://p2pfoundation.net/Valuing_the_Ethical_Economy>offers some deep insights into how this is plausible. Adam writes:
>
> *" What creates these ethical values? They are not the direct results of
> investments in labor time. You can work as much as you want on your music
> and style, that, in itself will not make you a rock star. Rather, suddenly
> something happens and then, you've made it. What determines your value are
> the quality and quantity of affect (attention) that you have been able to
> accumulate. The relation between the productive time invested in a project
> and the mass affect that it is able to attract is non-linear, or viral, to
> use a popular marketing term.[2] Models could be found in contemporary
> mathematical theories of network dynamics, and perhaps in Gabriel Tarde's
> theories of the role of public sentiment.[3] Indeed, the logical relation
> between value and labor is rather the reverse of that usually associated
> with the capitalist economy. Once you have a sufficiently attractive brand,
> you will attract an abundance of free labor as well as other resources.
> Linux has no problems recruiting new programmers: people want to work for
> them for free; people pay to use brands in their everyday life and thus
> freely co-produce their ethical value through their constructive consumer
> practices. On financial markets, capital flows to the most attractive
> brands. More means more in this case, if you have accumulated a significant
> stock of ethical capital, people will freely give you their time and further
> attention, or, on financial markets, their capital."*
>
> To sum it up, in order for markets to really help change society, we first
> need to create social infrastructure that allows us to value the ethical
> capital of the companies that we are doing business with. We need to
> democratize and equitably control these infrastructures on the level/scale
> of voluntarily cooperating and collaborating individuals. This will then
> create a conduit of ethics, and social focus, through which we all can
> pursue market exchanges. Markets measured against our real social interests,
> not just made to appeal to our base needs, or fool us into thinking they
> will solve our social problems.
>
> See also:
>
>    - http://p2pfoundation.net/Civil_Corporation
>    - http://p2pfoundation.net/Civil_Regulation
>    - http://p2pfoundation.net/Collaborative_Standards_Initiatives
>
>
>
> --
> Sam Rose
> Social Synergy
> Tel:+1(517) 639-1552
> Cel: +1-(517)-974-6451
> AIM: Str9960
> Linkedin Profile: https://www.linkedin.com/in/samrose
> skype: samuelrose
> email: samuel.rose at gmail.com
> http://socialsynergyweb.com/services
>
>
> Related Sites/Blogs/Projects:
> OpenBusinessModels: http://socialsynergyweb.net/cgi-bin/wiki/FrontPage
> http://p2pfoundation.net
> http://blog.p2pfoundation.net
> http://www.cooperationcommons.com
> http://barcampbank.org
> http://communitywiki.org
> http://openfarmtech.org
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