[p2p-research] Berardi essay

[Kevin Carson]

On 5/25/09, Andy Robinson <ldxar1 at gmail.com> wrote:
> To an extent "the old mass production model" has already gone, at least as a
> core part of the economy - the factories have been outsourced to peripheral
> countries as "low-value-added", and integrated into production chains which
> are leaner and more nodal.  If anything this has increased reliance on oil.

Sure--and that's the first stage in the decay of the old mass
production model.  Lewis Mumford called it a "cultural pseudomorph,"
with potentially decentralizing technologies like electrical power
being integrated into the "paleotechnic" framework of Dark Satanic
Mills, instead of living up to their potential as the basis of a
fundamentally different "neotechnic" era.  The first stage of decay
was the introduction of networked, lean methods of physical production
as in the Toyota Production System and the Emilia-Romagna region.

But the cultural pseudomorph, or paleotechnic framework, persisted in
the form of corporate headquarters that retained control of finance,
IP, and supply and distribution chains.

And the supply and distribution chains are the one thing that lean
hasn't touched yet.  So to the extent that lean, networked production
is still dependent on global "warehouses on wheels" (or "in container
ships") distribution chains, the system is to that still a Sloanist
batch-and-queue system, with the warehouse full of inventory just
outsourced to the highway or ocean.

The final step in the evolution from mass production to lean will be
when production itself is scaled to local markets, and these
warehouses on wheels are eliminated.  The transformation of the
distribution system is the last piece in the puzzle, and I think it
will be forced by Peak Oil.

And as numerous people on and off this list have pointed out, the
whole Nike model of outsourced, networked production makes the
corporate headquarters a node to be bypassed.  One form the bypass
will likely take is when the networked production chains you mention
decide to cut out Nike and ignore their IP rights, and sell the
sneakers (or whatever) directly to the local market without the
brand-name markup.  I think with its localized supply and production
chains, Emilia-Romagna could navigate the Peak Oil transition and
shift to production almost entirely for the local market, with
comparatively little disruption.

> But I'm not sure the current crisis is actually the coming-home-to-roost of
> the underlying systemic problems such as peak oil, climate change and
> overproduction/underconsumption.  It's the latest in a
> series of "bubble bursts" arising from financialisation in the 80s, which
> was itself a kind of "crisis management" of the 70s crisis (which was more
> structural).  Granted this is the biggest so far, but in the last fifteen
> years we've had the Russian collapse, the Mexican crisis, the Argentine
> crisis, the East Asian crisis, the dotcom bubble, the Enron crisis, the
> European ERM collapse, and probably a few more besides.  The causes of these
> recurring crises are very much conjunctural: massive American deficit
> spending based on abuse of the dollar's position as world reserve currency,
> hugely increased speed of financial flows leading to vulnerability to
> speculation, a huge excess of "fictional" financial capital over productive
> capital, massive (and largely unregulated) use of risky derivative
> investments by banks and governments which is seen as safer than it is.

I think Bello and the neo-Marxists it right on this:  the speculative
bubbles result from the underlying overinvestment/underconsumption
tendency, and are a way of soaking up surplus capital.

> Now, if we go back a stage further and ask why the 80s patch-up was needed
> in the first place, it becomes clear that the patch-up was a response to
> deeper, more fundamental problems, including overproduction and oil price
> rises (climate change doesn't enter until later).  Also a crisis of the role
> of America as hegemon, and of the Bretton Woods system.  These crises were
> never resolved, but simply postponed.  But the economy hasn't been in a
> growth wave since the 70s; it's been warding off the crisis which was felt
> then and is felt now.

Exactly.  But you seem to be arguing here, as I did before, that the
current economic crises are the culmination, at least indirectly, of
overproduction and Peak Oil.  I think the crisis was "postponed" by
WWII; Keynesianism only worked because America had some 75% of the
world's surviving industrial capacity in 1945, and it began to decay
around 1970 when Europe and the Pacific Rim had finished
reindustrializing.

> But, to return to "old production" and restructuring.  I think part of the
> crisis of the 70s has to do with networks and hierarchies.  The "old" system
> was highly hierarchical, but was suffering problems from certain kinds of
> structural weaknesses in relation to networks - the American defeat in
> Vietnam being especially important, though one could also refer to
> resistance through delinking and syncretism at the margins, Offe's
> decommodification crisis in the welfare state (based on power of everyday
> uses over systemic means) and the diffusion of popular cultures (importance
> of niche over mass markets).  And ever since the 70s the system has been
> trying to find hybrids of network and hierarchy which will harness and
> capture the power of networks without leading to "chaos" or
> system-breakdown.  We see this across a range of fields: just-in-time
> production, outsourcing and downsizing, use of local subsidiaries,
> contracting-out, Revolution in Military Affairs, full spectrum dominance,
> indirect rule through multinational agencies, the Nixon Doctrine, joined-up
> governance, the growing importance of groups such as the G8 and G20,
> business networks, lifelong learning, global cities, and of course the
> development of new technologies such as the Internet.

Yes.  The persistence of these institutional frameworks in the
economic sphere, dependent mainly on IP, is the second stage of
Mumford's decaying pseudomorph.

Your treatment of the political sphere as analogous is brilliant.  IMO
the institutional structure in the political sphere is headed for the
same systemic crisis as that in the economic sphere:  fiscal crisis,
"hollowed-out states," etc.  As the state's fiscal resources become
exhausted, we're headed for a time where the federal and state regimes
still formally exist, and Obama/Swarzennegger still provides a
reassuring presence on TV from Washington/Sacramento.  But the actual
functions and fiscal burdens of government, increasingly, will be
outsourced to localities on a DIY basis.  There'll be no need for a
secessionist movement, because the political center will "secede" de
facto from the localities.  Legislation will degenerate into an
increasingly unenforceable series of unfunded mandates, and localities
will continue to pay nominal obeisance to the central regimes while
pretty much ignoring the mandates.  The role of German tribal
structure in local governance, in the face of an increasingly hollowed
out Roman imperial state, is a good analogy.

And the localities themselves will be fiscally exhausted; we're seeing
this, for example, in dire warnings by local DAs in some areas that
they will no longer treat drug enforcement as a priority.  I expect
we'll also see local law enforcement begin to realize that while the
houses and the occupants will both probably still be around in five
years, the banks and rental companies may well not be, and that
enforcing foreclosures and evictions is a very low priority.

The upshot of this for the p2p economy is that localities will find
the zoning and licensing laws (whose main real effect is to
criminalize low-overhead, small-batch microenterprises in the informal
sector) just cost too much to enforce.

This was described in a very attractive fictional setting by James L. Wilson:
http://www.partialobserver.com/article.cfm?id=2955&RSS=1

"Well, you see all these people working on their gardens? They used to
not be here. People had grass lawns, and would compete with each other
for having the greenest, nicest grass. But your gramma came home from
the supermarket one day, sat down, and said, 'That's it. We're going
to grow our own food.' And the next spring, she planted a vegetable
garden where the grass used to be.

"And boy, were some of the neighbors mad. The Homeowners Association
sued her. They said the garden was unsightly. They said that property
values would fall. But then, the next year, more people started
planting their own gardens.

"And not just their lawns. People started making improvements on their
homes, to make them more energy-efficient. They didn't do it to help
the environment, but to save money. People in the neighborhood started
sharing ideas and working together, when before they barely ever spoke
to each other....

"And people also started buying from farmer's markets, buying milk,
meat, eggs and produce straight from nearby farmers. This was fresher
and healthier than processed food. They realized they were better off
if the profits stayed within the community than if they went to big
corporations far away.

"This is when your gramma, my Mom, quit her job and opened started a
bakery from home. It was actually in violation of the zoning laws, but
the people sided with gramma against the government. When the
government realized it was powerless to crack down on this new way of
life, and the people realized they didn't have to fear the government,
they became free. And so more and more people started working from
home."

> While networks on their own might be democratising, equalising, liberating -
> the hybrid forms are not, because they inject aspects of command at key
> points as substitutes for voluntary agency.

True.  But I think the hybrid forms are just an attempt to postpone
the inevitable, and will ultimately be unsustainable.

> In the medium term, the loss of power to networks is probably irreversible,
> and capital and the state will either go down fighting or create
> more-or-less stable intermediary forms which allow them to persist for a
> time.  We are already seeing the beginnings of the latter, but the former is
> more predominant.  The way I see the crisis deepening is that large areas
> will drift outside state and capitalist control, integrated marginally or
> not at all (this is already happening at sites such as Afghanistan, NWFP,
> the Andes, Somalia, etc., and in a local way in shanty-towns and autonomous
> centres).  I also expect the deterritorialised areas to spread, as a result
> of the concentration of resources in global cities, the ecological effects
> of extraction, the neoliberal closing of mediations which formerly
> integrated, and the growing stratum of people excluded either because of the
> small number of jobs available or the growing set of requirements for
> conformity. Eventually these marginal spaces will become sites of a
> proliferation of new forms of living, and a pole of attraction compared to
> the homogeneous, commandist, coercive core.

I think we're on the same page here.  States will retreat into
themselves, abandon functions and "regroup," and try to save face by
ordering the sitting dog to do what he was doing anyway.

> At the moment, the state (backed by capital) tries to bring these areas back
> in violently, but sooner or later, sectors of capital will realise they can
> profit by working with forces on the ground in the deterritorialised areas.
> Corporations which adapt to their loss of power at marginal points will
> become more like merchants, or service providers; I see the likes of
> PirateBay as forerunners in this regard.  States which adapt will become
> "rhizome-states" linking to the locality only through intermediaries in the
> local setting, and losing their control function - they might become a kind
> of pure welfare-state or pure distributive state.  Or, states might try to
> draw on the proliferating energies by creating concentrated open spaces
> similar to the old city-states (there are already micro-states which do this
> in relation to capital flows).  In all these cases, the flows will be so
> uncontrollable and unpredictable that the hierarchies will not have
> regulative force over them, will not be able to guarantee profit, but
> rather, will be almost parasitic on abundance.  I suspect some will choose
> this over disappearance, once the structural power of networks is sufficient
> to overpower the violent response one currently sees.

Interesting.  But IMO the ability of rhizome states and economic
ventures like Pirate Bay to profit, to capture value, will be severely
limited:  it will be impossible to suppress market entry by competing
service providers when states no longer have direct regulative force.
So whatever political and economic forms persist over large
geographical areas will take on an increasingly networked character;
but even more important, an increasingly genuine cooperative/p2p
character, and the possibility of free market entry by competing
networks transforms them into utilities controlled by the end-user.

Thanks for some extremely thought-provoking comments.  Do you mind if
I quote you in some material I'm working on?

-- 
Kevin Carson
Center for a Stateless Society http://c4ss.org
Mutualist Blog:  Free Market Anti-Capitalism
http://mutualist.blogspot.com
Studies in Mutualist Political Economy
http://www.mutualist.org/id47.html
Organization Theory:  A Libertarian Perspective
http://mutualist.blogspot.com/2005/12/studies-in-anarchist-theory-of.html