[p2p-research] Special issue tripleC: Capitalist Crisis, Communication & Culture

[Michel Bauwens]

Thanks Vasilis,

The David Hakken piece is really a must read:


** Article: Computing and the Current Crisis: The Significant Role of New
Information Technologies in Our Socio-Economic Meltdown David Hakken,
tripleC, Vol. 8. No. 2, pp 205-220*

URL = http://www.triple-c.at/index.php/tripleC/article/view/161/193


   Contents[hide <javascript:toggleToc()>]

   - 1 Abstract<http://p2pfoundation.net/Computing_and_the_Current_Crisis#Abstract>
   - 2 Excerpts Part One: Analyzing the
Problem<http://p2pfoundation.net/Computing_and_the_Current_Crisis#Excerpts_Part_One:_Analyzing_the_Problem>
      - 2.1 Ways in which Computing Bears Responsibility for the Current
      Crisis<http://p2pfoundation.net/Computing_and_the_Current_Crisis#Ways_in_which_Computing_Bears_Responsibility_for_the_Current_Crisis>
      - 2.2 Asset Value Unknowability as the Core of the Current
Crisis<http://p2pfoundation.net/Computing_and_the_Current_Crisis#Asset_Value_Unknowability_as_the_Core_of_the_Current_Crisis>
      - 2.3 How unknownability is linked to Intellectual
Property<http://p2pfoundation.net/Computing_and_the_Current_Crisis#How_unknownability_is_linked_to_Intellectual_Property>
   - 3 Excerpts Part Two: The
Solution<http://p2pfoundation.net/Computing_and_the_Current_Crisis#Excerpts_Part_Two:_The_Solution>
   - 4 Source<http://p2pfoundation.net/Computing_and_the_Current_Crisis#Source>

 [edit<http://p2pfoundation.net/Computing_and_the_Current_Crisis?title=Computing_and_the_Current_Crisis&action=edit&section=1>
] Abstract

"There is good reason to be concerned about the long-term implications of
the current crisis for the reproduction of contemporary social formations.
Thus there is an urgent need to understand it character, especially its
distinctive features. This article identifies profound ambiguities in
valuing assets as new and key economic features of this crisis, ambiguities
traceable to the dominant, “computationalist” computing used to develop new
financial instruments. After some preliminaries, the article identifies four
specific ways in which computerization of finance is generative of crisis.
It then demonstrates how computationalist computing is linked to other
efforts to extend commodification based on the ideology of so-called
“intellectual property” (IP). Several other accounts for the crisis are
considered and then demonstrated to have less explanatory value. After
considering how some commons-oriented (e.g., Free/Libre and/or Opening
Source Software development projects) forms of computing also undermine the
IP project, the article concludes with a brief discussion of what research
on Socially Robust and Enduring Computing might contribute to fostering
alternative, non-crisis generative ways to compute."


[edit<http://p2pfoundation.net/Computing_and_the_Current_Crisis?title=Computing_and_the_Current_Crisis&action=edit&section=2>
] Excerpts Part One: Analyzing the Problem

David Hakken:

"In my view, what is distinctive about the current crisis is new and
significant ambiguities in valuation, the process by which particular
cultural forms are assigned particular values, including but not only their
values as commodities. Further, I think one kind of social practice – the
way automated information and/or communication technologies have normally
been used, or “computing” for short—is central to the creation of these
ambiguities, that computing has played a key, insufficiently understood role
in bringing them about. Thus, focusing on how we compute, and more
generally, the role of technology in the crisis, provides a way to think
more inclusively about it. Doing so broadens our focus, so we can attend to
general changes in the dynamics of current social formation reproduction.


Thus, the articles’ central contentions are:

• That the co-occurrence of the crisis and a substantial increase in the
degree to which human activity is computerized is indicative of a
substantial (e.g., what used to be called a “causal” (Campbell, 2005))
connection between them; • That the substantial connection between crisis
and computing is likely rooted in financial entities computerized in the
dominant “computationalist” manner, which in turn are the primary source of
the ambiguities in valuation that give the current crisis its special
character; • That this unique feature of the current crisis is one facet of
a more general intervention, several efforts to commodify a greater
proportion of the reproductive dynamics of contemporary social formations
(including the “invention” of “Intellectual Property” (IP)) rather than
other facets of computing (e.g., web 2.0 or “playbor”) or of social
formation reproduction (e.g., globalization) currently given much attention;
and • That the contemporaneous, widespread development of alternative ways
to compute, such as Free/Libre and/or Open Source Software (FLOSS),
exacerbate the current crisis while also modeling forms of computing which,
being less generative of crisis, are worthy of additional study.

I argue that calling it a “computing-induced crisis” is justifiable in the
registers used by contemporary social theorists to talk about social
causation, that understanding how we currently compute is necessary in order
to specifying the alternative computing practices needed to avoid similar

crises in the future. The dynamics of social formation reproduction have
changed, computing has much to do with the change, and the change is
manifest in but not caused by new relationships among workers, managers, and
consumers at the point of production. Rather, the new dynamic of crisis
follows from implementation of a new way of conceptualizing the role of
computing in the creation and sale of a range of new financial commodities.
This new ideology of using computers to extend commodification fit with
certain additional changes in, e.g., legal instrumentalities like
“intellectual property.” While intended to aid the reproduction of capital,
the new moves have (thus far) caused more problems that they have
solved—i.e., have produced crisis.

Making this complex case definitively would require more than a single
article. Here, I sketch out my argument, beginning with the reasons for
seeing a connection between crisis and the dominant forms of computing as it
was breaking. I then outline some alternative, non-computing-oriented
accounts of the crisis and why I don’t find them as persuasive as a focus on
computing. Next, I draw out the connection between computing’s dominant
forms and attempts at a new property regime, showing how the failures of
these forms and this regime are intimately connected to the crisis. I then
explicate the paradoxical role of FLOSS, in both exposing flaws in the
regime and furthering crisis. I conclude by discussing how to identify the
different, more socially robust ways to compute that are required if we are
not to experience this kind of crisis, or even more virulent varieties of
it, repeatedly."


[edit<http://p2pfoundation.net/Computing_and_the_Current_Crisis?title=Computing_and_the_Current_Crisis&action=edit&section=3>
] Ways in which Computing Bears Responsibility for the Current Crisis

Stated positively and in broad-brush terms, I see four ways in which
computing, especially a particular form of it that I call “computationalist”
has played a central, generative role in the current crisis. I see these
four forms as being sufficiently prior to the crisis in both logical and
temporal senses to speak of them in a loose but still meaningful register
(see footnote #3) as causative of the crisis.


They are:

1. Perhaps the most obvious crisis-generative aspect of computing is the
profoundly instrumental role it played in the creation and marketing of a
broad range of new financial instruments; that is, in new forms of
financialization. “Financialization” of an economy occurs when a substantial
proportion of capital realization takes place through the creation and sale
of abstract monetary instruments, rather than through the production and
sale of “real” (material) goods and services. Following Baran and Sweezy
(1966), Foster and Magdoff (2009) make a convincing case that
financialization has long been the chief strategy of late capitalism for
fighting against the tendencies toward stagnation. Financialization has been
evident in many capitalist economies since the 1970s; thus, the current
crisis cannot follow from financialization in general. However, crisis does
follow from the spread of particular, highly computer mediated financial
instruments upon which the realization of profit became very dependent just
prior to the outbreak of the current crisis. Instruments typical of the
current form of financialization include those that garnered most public
attention, the sub-prime mortgage-based securities created largely in the
United States and marketed worldwide. Equally important to the crisis, I
believe, were other computered commodities, including those collateralized
in new forms of debt obligation (engineered by mixing several financial
components into complex and largely opaque new entities, and similarly sold
via new (international; see below) markets in securities), and parallel,
equally nontransparent credit default swaps (essentially a financialized
form of insurance).


2. Computing is heavily implicated in the emergence and trade of all these
new commodities.

Given their complexity, none of them, nor markets in them, could have
existed without it. Nor was computing’s role merely one of creating the
possibility of doing such things. Only a few of the forms of
financialization that were possible to computerize were actually developed
(Tett 2009b). Those financial commodities that were developed and marketed
were given the properties they had via what computer people call
“affordances”—inclinations that, given existing preexisting developments or
“path dependencies,” are likely to follow, unless action is taken to prevent
them. Indeed, many of the AICTs that made these new commodities possible
were developed precisely in order to create things like them. This path
dependency was a consequence of the particular mix of the entrepreneurial
and technical built into contemporary education in and the practice of
computing. In short, to the extent that computing was essential to these
commodities’ creation, and that market failures in these new financial
commodities were central to the crisis, computing caused the crisis.

These computered financial instruments strongly afforded the elaboration of
national markets for capital into a virtually global single market. Just as
a desire for new commodities to trade in, so that more money could be made,
drove computing development and implementation, so the development of
international computing networks strongly incentivized creation of an
unboundried market in capital. Indeed, the two go together; prospects for
profitable trading in the new financial instruments were directly related to
the extent to which the reach of the capital market could be scaled up.

However, this up-scaled market was formed without a simultaneously
up-scaling of a parallel set of governance tools with which to regulate the
trade carried out on it.

...

3. Less publicized but equally central to the generation of crisis were the
widely adopted, computered models of the risks to sellers and buyers
associated with trade in the new financial instruments. As the instruments
were new, there was no “track record” of actuarial data on which to base
judgments regarding the risks involved in buying, holding, and selling them.
One consequence was major difficulties in pricing them, the implications of
which exacerbated by the absence of forms of international governance in
up-scaled markets.

Indeed, were it not for the development of complex, algorithm-based
(computerized) risk assessment tools, trade in the new commodities,
especially international, might well have remained marginal to capital
realization. Moreover, the tools that were developed were based on
presumptions like the idea that sufficiently detailed models would capture
all relevant risk factors, as well as the notion that risk would follow the
normal statistical distribution. As Gillian Tett demonstrates (2009b), these
computer-based risk models were applied far beyond the intended applications
of their initial developers. Presumed to be reliable, they became
essentially the basis of price-setting models in the new financial
instruments.

The arrival of crisis demonstrated these risk models were faulty. Numerous
scholars and commentators, following Nassim Nicholas Taleb (2007), critiqued
the models’ for their failure to incorporate the risk of the kind of general
“systemic” failure that actually did occur."


[edit<http://p2pfoundation.net/Computing_and_the_Current_Crisis?title=Computing_and_the_Current_Crisis&action=edit&section=4>
] Asset Value Unknowability as the Core of the Current Crisis

"Asset value unknowability as the core of the current crisis:

In at least three additional important ways, the computerization of
financial instruments led to a situation where assets’ values became
ambiguous and increasingly unknowable."


After giving 3 reasons for this, Hakken concludes:

"In short, a unique, perhaps the unique, characteristics of the current
crisis is precisely these huge, persisting socio-economic spaces of
unknowability. Given that a huge proportion of economic activity (Tett
estimates some 80%) was financialized, this unknowability is lodged at the
center of the reproduction of contemporary capitalist social formations.

The consequences of the lack of fit between the particular forms of
computer-mediation of financial assets, on the one hand, and the wide
swathes of unknowability to which their use led, on the other, have been
amplified by the substantial upping of the scale (e.g., the “globalization”
of markets in capital) at which some aspects of social formations (but not
all) are able to be reproduced, further increasing the difficulty of
establishing what specific value any given asset has. Indeed, it seems to me
that the crisis will continue as long as a substantial body of difficult to
evaluate assets persists. In sum, by 2008, many large social formations were
in crisis. This crisis was a function of an economy highly mediated by a
particular form of financialization (Tett, 2009a) which itself was afforded
by a particular form of computing. The absence of any of the four ways
outlined above in which computationalist computing afforded shaky
financialization would have reduced the salience of the other two; all four
seem central to a specific computing regime, a computing sociotechnological
system in the sense of Thomas Hughes (2004), or a computing technology actor
network in the Science, Technology, and Society language of Callon and
Latour (1992). In the absence of such a computing regime, there may have
been a crisis, but it would likely have taken a different, possibly less
virulent form."


[edit<http://p2pfoundation.net/Computing_and_the_Current_Crisis?title=Computing_and_the_Current_Crisis&action=edit&section=5>
] How unknownability is linked to Intellectual Property

"At base, the unknowability of the new financial commodities is a
consequence of the at base oxymoronic character of Intellectual Property. IP
is an oxymoron in that, in order for the intellectual merit of, say, an
idea, to be acknowledged and then valued on some quantitative scale of
relative merit, it must first be communicated. However valuable I might
consider my own ideas, there can be no compelling reason for another to
share my evaluation without her first understanding them. For her to do
this, I can’t keep them private; I have to say what they are. I can’t even
get away with just saying what they are “like.” However, once communicated,
it is difficult to control the understander’s use of the idea. Thus, any
effort to turn ideas into private property faces a fiendish difficulty: how
to keep control over things, like ideas or notions, that by their nature
must be shared if they are to be evaluated. This problem is exacerbated by
digitalization: once created, digital representations of ideas and notions
are reproducible at extremely low cost (think of the cost to the writer of
an email)."


[edit<http://p2pfoundation.net/Computing_and_the_Current_Crisis?title=Computing_and_the_Current_Crisis&action=edit&section=6>
] Excerpts Part Two: The Solution

David Hakken:

"New, more socially robust forms of computing – deriving from, inter alia,
what I call the strong program in social computing – not only must but can
be developed and should be implemented as part of a crisis
recovery/avoidance strategy. Fortunately, some computer practitioners – whom
I like to call informists – have some good ideas about how to pursue
socially robust and therefore enduring computing (SREC; Hakken, 2010), ideas
incubated within the non-dominant forms of computing that have refused to
reduce themselves to formalisms alone. The alternative practices are central
to the Social Informatics within which I frame my research and that I teach
at the new School of Informatics and Computing at Indiana University in the
USA and at Trento University in Italy. Their ability to thrive, however,
depends upon reinforcement of property regimes very different from IP and
much more like the “commons” oriented regimes of FLOSS. Let us hope that
commonsilluminative views, like those resulting in a Nobel Economics Prize
for my Indiana University colleague Elinor Ostrom (e.g., 1990), come to
provide a clear alternative orientation for professional computing."
[edit<http://p2pfoundation.net/Computing_and_the_Current_Crisis?title=Computing_and_the_Current_Crisis&action=edit&section=7>
] Source

tripleC (cognition, communication, co-operation): Open Access Journal for a
Global Sustainable Information Society. Vol. 8. No. 2: Special Issue on
Capitalist Crisis, Communication & Culture Edited by Christian Fuchs,
Matthias Schafranek, David Hakken, Marcus Breen

URL = http://www.triple-c.at/index.php/tripleC/issue/current




On Sun, Aug 29, 2010 at 9:41 PM, Vasilis Kostakis <kostakis.b at gmail.com>wrote:

>
> tripleC (cognition, communication, co-operation): Open Access Journal
> for a Global Sustainable Information Society.
>
> Vol. 8. No. 2: Special Issue on Capitalist Crisis, Communication & Culture
> Edited by Christian Fuchs, Matthias Schafranek, David Hakken, Marcus Breen
> http://www.triple-c.at/index.php/tripleC/issue/current
>
> Suggested citation: Fuchs, Christian, Matthias Schafranek, David Hakken
> and Marcus Breen. Eds. 2010. Special issue on “Capitalist crisis,
> communication & culture“. tripleC (cognition, communication,
> co-operation): Open Access Journal for a Global Sustainable Information
> Society 8 (2): 193-309.
>
> “Capitalism […] is approaching an apocalyptic zero-point” (Slavoj Žižek).
>
> What is the role of communication in the general situation of capitalist
> crisis?
> The global economic downturn is an indicator of a new worldwide
> capitalist crisis. The main focus of most public debates as well as of
> economic and policy analyses is the role of finance capital and the
> housing market in creating the crisis, less attention is given to the
> role of communication technologies, the media, and culture in the world
> economic crisis. The task of this special issue of tripleC is to present
> analyses of the role of ICTs, the media, and culture in the current
> crisis of capitalism. The seven papers focus on the causes, development,
> and effects of the crisis. Each paper relates one or more of these
> dimensions to ICTs, the media, or culture.
>
> Capitalist Crisis, Communication, & Culture – Introduction to the
> Special Issue of tripleC
> Christian Fuchs, Matthias Schafranek, David Hakken and Marcus
> Breen (Special Issue Editors)
> pp 193-204
> http://www.triple-c.at/index.php/tripleC/article/view/228/189
>
> Computing and the Current Crisis:
> The Significant Role of New Information Technologies in Our
> Socio-Economic Meltdown
> David Hakken
> pp 205-220
> http://www.triple-c.at/index.php/tripleC/article/view/161/193
>
> The Virtual Debt Factory: Towards an Analysis of Debt and Abstraction in
> the American Credit Crisis
> Vincent R. Manzerolle
> pp 221-236
> http://www.triple-c.at/index.php/tripleC/article/view/149/192
>
> Calculating the Unknown. Rationalities of Operational Risk in Financial
> Institutions
> Matthias Werner and Hajo Greif
> pp 237-250
> http://www.triple-c.at/index.php/tripleC/article/view/184/194
>
> Crisis, What Crisis? The Media: Business and Journalism in Times of Crisis
> Rosario de Mateo, Laura Bergés, Anna Garnatxe*
> pp 251-274
> http://www.triple-c.at/index.php/tripleC/article/view/212/195
>
> Anglo-American Credit Scoring and Consumer Debt in the Subprime Mortgage
> Crisis of 2007 as Models for Other Countries?
> Thomas Ruddy
> pp 275-284
> http://www.triple-c.at/index.php/tripleC/article/view/176/198
>
> Crise, Genre et TIC : Recette pour une Dés-Union Pronon- cée. L’Exemple
> de l’Afrique du Sud
> (in French)
> Joelle Palmieri
> pp 285-309
> http://www.triple-c.at/index.php/tripleC/article/view/141/197
>
>
> --
> http://kostakis.org/
>
>
> _______________________________________________
> p2presearch mailing list
> p2presearch at listcultures.org
> http://listcultures.org/mailman/listinfo/p2presearch_listcultures.org
>
>


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