The Zero Marginal Cost Society by Jeremy Rifkin

[Edward theurj Berge]

After reading the Intro and first chapter a few comments. On p. 6 he discusses how monopolies intentionally thwart competition and innovation so as to maintain their stranglehold. But he claims entrepreneurs find a way around it and end up forcing competition with their better tech and price reductions. Yet he discusses on pp. 7-9 Larry Summers 2001 paper, wherein Summers acknowledges the emerging information economy was indeed moving to near marginal cost. Summers though didn't propose something like Rifkin but instead recommended "short-term natural monopolies" (8).

Recall Summers was Obama's pick for Director of the National Economic Council. His policy suggestions were well in line with the earlier promotion of "natural monopolies," and his resume attests. And we're seeing exactly this economic philosophy at play with the FCC Chairman Wheeler's proposed pay-to-play rules, where the ISP monopolies will destroy internet neutrality. Recall that Wheeler was another Obama pick, and was a former, and will return to being, a cable and wireless lobbyist. While Obama claims to back income equality and net neutrality he appoints the likes of Summers and Wheeler who make no bones about their support of monopolies. And without net neutrality good bye to Rifkin's entire plan, which requires it to succeed.

If you haven't yet, please take action to preserve it. Here's one place and you can find several others if you but look.

[Edward theurj Berge]

Darrell,

I asked you before and I'll ask again. Please start a thread or threads on your work. If/when you do, please move your last couple of posts over to it. If you want to include snippets of your work relevant to this particular discussion thread that's ok, but not when your responses are only about your work. This thread is specifically for discussion of Rifkin's new book. Thanks.

[Edward theurj Berge]

Chapter 12 is on defining and controlling the IoT. The problem is that the capitalists of the earlier industrial revolutions want to own and control the new infrastructure with their centralized, top-down command and control methodology. And yet the IoT is itself structured for distributed, collaborative, lateral, peer-to-peer modes. The latter is also more ideally suited for management of renewable energies, as they also exemplify the same qualities.

Focusing on the 3 parts of the IoT Rifkin starts with the communications internet. We see the dominant ISPs wanting to use the capitalist model to end net neutrality so they can create fast and slow lanes on different fee scales. While they won't admit it, this will also create content interference as those with less money will be relegated to slower connection speeds. And likely some content providers might be eliminated access altogether if they espouse philosophies contrary to the kind of capitalist paradigm of the owners of access. The IPS use capitalist justification that they need to continually feed the beast of ever-growing profits when in fact they already make a shitload of money selling neutral access. They are under the spell of capitalist winner take all mentality that leads inevitably to greed.

It's not just the ISPs that want to dominate the internet. Social networking sites like Facebook also have a capitalist model in which they want to dominate all member personal information as proprietarily enclosed to do with as they please. This includes selling it to third parties for advertising lists, as well as forking it over the the NSA on 'national security' grounds. It also includes the very real possibility of selling it to insurance companies which could affect one's coverage and premiums with private information not typically available. This is also a concern when employers track your personal information in making hiring or firing decisions. I've read that some employers will not even consider a candidate unless they have a comprehensive personal profile obtained from the internet.

Other areas of internet enclosure are also of concern. Google has a 66% market share in the US (much higher in other countries), Amazon 33%, eBay 99%, Facebook 72%. Twitter has 500 million registered users. They thus control access to, and the content of, information in ways conducive to their own capitalistic motives. These companies constitute an oligopoly in direct opposition to the very nature and structure of the internet. To “just hope that corporate goodwill will be sufficient to preserve the integrity of the process is at best naïve and at worst foolhardy” (203).

Big energy companies want to control the energy internet, again dominating with their capitalist structure. In some cases they are blocking the emergence of a smart grid altogether. Fortunately the EU has instituted regulations to keep it an open format, requiring them to unbundle energy production from transmission. Feed-in tariffs are also promoting local and regional green energy production. He cites the huge success story of the Tennessee Valley Authority, where the government invested in creating a huge hydroelectric plant for these rural areas previously without electricity. They empowered local electricity cooperatives through low-interest loans to build the infrastructure. And they did so much more efficiently and at lower cost than the big private companies could. The results were a boom to not only the local but the national economy.

He then devotes a section to cooperatives generally, with impressive statistics on their successes. He concludes that “cooperatives are the only business model that will work in a near zero marginal cost society” (214).

In terms of logistics, the capitalist way of handling this is incredibly inefficient and costly. Companies only have so many distribution centers, each of which must cover large areas. Thus when it comes to shipping goods drivers must take circuitous routes adding to fuel costs. Also the goods often stay in these isolated centers for far too long thus causing spoilage and/or backlogs, not being delivered in a timely fashion causing shortages on store shelves. Whereas if logistics were managed on the commons model, all of the 535,000 existing distribution centers and warehouses could be shared. This would allow the drivers to just do one leg of the journey with a full load instead of cross-regional or cross-country journeys with diminishing loads to limited distribution centers. This of course will require the logistics internet to track all the trucks and goods, and time the exchanges at the centers to arrive at their end destinations efficiently. There is considerable savings on cargo space, fuel costs and quicker delivery via these shared and distributed logistics.

[Edward theurj Berge]

Here's an article that highlights many of the implications above on the battle for net neutrality.

[Edward theurj Berge]

Recall the PS in this post earlier in the thread on Habermas' postmetaphysical reason. Now see this blog post, which also relates to this post in another IPS thread on disenchantment/reenchantment. In the blog he argues that while Habermas accepts Weber's disenchantment of the world, Habbie nonetheless still sees a means for reenchantment. The disenchantment came from instrumental rationality necessarily having to refute the magical worldview, thereby causing a rift with reason and nature. It did so by a differentiation of the value spheres than eventually went into dissociation, as the Lingam phrases it. Habermas finds the reenchantment of nature with reason not by returning to a transcendent God, or even through the "metaphysical conception of objective reason," but through a form of reason grounded in pragmatic, this worldly (natural) communication.

Note that the Lingam originally associated Habbie's communicative reason as incipient vision-logic, a level above pomo relativism. He also later criticized Habbie (pp. 4, 12) with further levels beyond this, another story for another day.

[Darrell R. Moneyhon]

That Habbie stuff went over my head, but sounded something like my own thoughts about functional philosophy seeking to find useful theories and metaphors which end up adding actual quality to collective and individual lives whether or not they have objective validation. If a philosophical notion works and works sustainably, then that's close enough to a "truth" for me! The thoughts (factual or not) orient the mind in a way that somehow or another leads to wellbeing. "True" like a true love who does good for his or her lover. If the philosophical notion improves the life quality of the philosopher and those around him/her, then it is like a loyal servant or true love. 

To me "postmetaphysical" could mean metaphoriphysical, a metaphysical metaphor not taken literally, but instead chosen for how it affects our psychology and wellbeing. If, for instance, going deeper into one's consciousness is only metaphorically or figuratively true, even though the participant assumed an actual going deeper (like sending a bucket down into an actual well), and then consistently adds value to the person, then it functions in a true way. It works. How much more "true" can something be than a concept that works?  An non-factual belief that works is, as far as I'm concerned, more "true" than a factual belief that doesn't work for the believer. What's wrong with a good non-factual "meaningful myth" (to use Joseph Campbell's phrase)?  The "metaphysics" of my self-fare model is a metaphoricphysical which does not presume that the model is a given. As long as the model "gives" that's fine. It's a metaphorical or figurative or humble metaphysics (metaphoriphysical) instead of a literal metaphysics that presumes to know something it can't confirm. No givens. Only givings.

Darrell 

theurj said:

Recall the PS in this post earlier in the thread on Habermas' postmetaphysical reason. Now see this blog post, which also relates to this post in another IPS thread on disenchantment/reenchantment. In the blog he argues that while Habermas accepts Weber's disenchantment of the world, Habbie nonetheless still sees a means for reenchantment. The disenchantment came from instrumental rationality necessarily having to refute the magical worldview, thereby causing a rift with reason and nature. It did so by a differentiation of the value spheres than eventually went into dissociation, as the Lingam phrases it. Habermas finds the reenchantment of nature with reason not by returning to a transcendent God, or even through the "metaphysical conception of objective reason," but through a form of reason grounded in pragmatic, this worldly (natural) communication.

Note that the Lingam originally associated Habbie's communicative reason as incipient vision-logic, a level above pomo relativism. He also later criticized Habbie (pp. 4, 12) with further levels beyond this, another story for another day.

[Edward theurj Berge]

Chapter 13 is on the transfer of ownership to access. The automobile is the perfect metaphor for the capitalist paradigm. Therein freedom is defined as being enclosed in one's autonomy with the ability to move about at will. But this is being replaced in the sharing economy of the Commons, as car sharing is becoming increasingly common. Here freedom is defined as the right to include others. He cites voluminous statistics on the growing use of sharing which in turn if drastically reducing car ownership, thus reducing inefficient use, emissions and traffic congestion.

Sharing is also extending to other good and services, including clothing, housing, tools, toys and skills. It turns out with the economic downturn many are questioning why they needed so much stuff in the first place. It lies dormant most of the time and has put them in dire debt. People are becoming aware that they can reduce their debt while making use of their possessions by sharing, which in turn makes them feel part of a community instead of locked away in their enclosed spaces of home and car. They realize the were “sold a bill of goods” (233) that does not add to their happiness. “Reducing addictive consumption, optimizing frugality, and fostering a more sustainable way of life is not only laudable, but essential if we are to ensure our survival” (237).

The change to a Commons is seriously affecting advertising. This is the industry that got us to buy into over-consumption in the first place, equating it with success. The industrial revolution's increased production and wages led to surplus goods and disposable income, so advertising quickly set about to mate the two in a happy marriage of accumulating stuff to feed our enclosed egos. But per above we are shifting away from this and sharing our stuff and reconnecting with each other. Communicating about our stuff directly with one another has reduced the need for depending on advertisers. We now depend far more on each others review of goods and services, since we trust the opinions of peers not bent on selling us something. The rise of Craigslist and Angie's List are examples of this growing trend. And indicative of people taking responsibility to do their own fact checking and peer review on information instead of just accepting an ad on corporate media.

[Edward theurj Berge]

Addendum to the last chapter. There was a section on how the Commons is affecting medicine that I skipped for brevity. The one aspect of that I did want to mention is 3-D printing's ability to 'grow' human tissue using one's own living cells to prevent rejection. So far they've achieved the creation of some liver tissue and a human kidney. They expect that growing organs and specialized tissues will be commonplace within 10 years.

Which reminds me of the movie Transcendence. Recall that was one of the AI's projects, at first making plants, then human tissues, then organs, then people. That part of the movie at least is barely science fiction. (Well, human cloning production is a bit further off.) Also the people who were connected to, and enhanced by, the AI still maintained their individuality but were all connected to each other like the Commons. The movie may very well be a metaphor for the Commons and the emerging IoT smart grid.

[Edward theurj Berge]

Chapter 14 addresses how the Commons applies to other paradigms. After the financial crises other means of banking have been explored, crowdfunding being one. Capital is raised from the general public for one's project and a specified minimal amount must be raised for the funds to be collected. Companies like Kickstarter that organize the funding get a small cut, as does Amazon for collecting it. There are different forms of investor compensation, from future goods by the provider to shares in the profits to interest on the loan. It eliminates the banks with their usurious interest rates.

Alternative currencies is another expression. Instead of monetary exchange there is social exchange. Goods and services can be exchanged in labor time banks. One provides a good or service to another and his time is updated to a database. When that provider needs a good or service he can look up another provider and use his stored labor to obtain that service. Some of these banks do not differentiate the type of service or expertise level but others do, so not all types of time deposits are equivalent. Some even keep the time banks confined to their local or regional community, thereby keeping it 'in the family.'

The build-out of the IoT infrastructure will create a lot of new jobs in the short to mid-term. Granted when fully implemented it will have little need of jobs to maintain it, but in the interim there will be plenty. Of course many will need to be retrained to tackle the new tech, but that of course can be handled by the sort of commons education previously discussed. All of which will “give birth to a new economic order whose life force is as different from market capitalism as the latter was from the feudal and medieval systems from which it emerged” (269).

[Edward theurj Berge]

Chapter 15 is on the tension between scarcity and abundance. Capitalism is based on scarcity due to the limited sources used to maintain it, like fossil fuels. Whereas renewal energies are abundant. Therefore the former uses exchange value and the latter share value. The former depletes our environmental stores, the latter sustains it. It depends though on how we define abundance. It is not the sort of over consumption inherent to capitalism. Biologically humans need 2000 – 2500 calories of food per day. The average American consumes about 3700, while much of humanity on far less than what's needed. We are consuming far to much to sustain our biospheric ecology.

Part of the solution is finding the balance of what is enough to make us happy. Studies indicate that we are happiest when we have enough income, about $20,000 in the US, to buy the necessities. More than that has an inverse relationship on happiness. Buying more stuff feeds off of capitalism's inherent scarcity, in that we can never have enough. Focusing on individual material surplus only reinforces our dysfunctional autonomy and represses our empathy. Whereas when our focus is more on sharing surplus with each other we feel not only more connected but that enough is enough. We consume only the resources needed and change our wants into sharing social goods and are far happier in the process. And greatly reduces our ecological footprint in the process.

However two key elements can derail the entire transition into the commons era. One is climate change, the other cyberterrorism. Already the overall global warming is disrupting the water cycle causing increasingly disastrous events. Agricultural food losses due to flooding and drought are bad and will only get worse, causing severe scarcity. Vital infrastructure is being decimated by extreme weather events. Hence we need a quick, effective transition to RE to curtail climate change. Cyberterrorism prime target is the current centralized energy grid. Take that out and you virtually destroy society. This too requires a quick transition to a distributed smart grid system that cannot incapacitate the entire society. All of which will require “a fundamental change in human consciousness” (296) from capitalism to the commons.

[Edward theurj Berge]

Addendum to the last chapter. It stated that $20,000 per year was a sufficient individual wage to meet our basic happiness. I'm guessing that number is a bit high due to likely including a range of types, from commoners to capitalists. I personally am getting by nicely on far less since I retired. Yes, I reduce rent by living with others in a home share. And I've drastically reduced the amount of owned stuff, even books, sharing them via the library. I have enough to eat and my health care is covered by the VA since I'm a vet. Even if I weren't I'd likely qualify for very low-cost to free care with Obamacare. And I'm happier than when I made a shitload of money working for a company that had little to no ethics or social concern.

Another issue is that is we create a society of shared abundance won't we thereby continue to consume much more than is sustainable? Yes, if we were to remain in a individualistic mindset beset with scarcity. The whole point though is that the reason a commons mindset is emerging is due to the commons lifestyle. He cites studies that show youth growing up in this milieu are much more socially and environmentally conscious, thus reducing their consumption of material goods and increasing their sharing of those goods. If we implement a commons economy on a global scale, thus producing material abundance, any surplus will not be transferred into more material stuff but a better and fuller life for everyone, including sustainable environmental practices based on RE.

[Edward theurj Berge]

Chapter 16 is a recap of the historical eras. In forager/hunter societies our empathic drive was limited to one's family and tribe in mythological consciousness. We then moved into agricultural civilization where empathy was extended to one's religious family in theological consciousness. Next up was a steam-powered civilization that extended our empathy to those in our nation states and an ideological consciousness. Next was mass electrification and an extension of empathy to larger associations based on cultural, professional and technical affiliation via psychological consciousness. And now we are entering the commons via the internet and emerging IoT, our empathy extending to all humanity as well as the environment via biospheric consciousness.

He notes that all of the above still exist in each of us with different emphases as well as culturally is various degrees depending on context. There are also regressions and progressions depending on a variety of factors. But overall there is an unmistakable trajectory of greater empathetic embrace. And this is not some transcendent, ever-more abstract worldview detached from our basic empathetic connections. Empathy is what keeps us grounded in this body and this world as we acknowledge that this life is finite and we all die.

Somewhere around the shift from ideological to psychological consciousness we realized this via our existential crises. As we move into biospheric consciousness we use death to remind us of how precious and fragile life is in all its manifestations and take responsibility for better stewardship of that life knowing it will end. Whatever relative immortality there is lies in our contributions to a progressive biospheric culture in which we participate. And if that shift reaches enough of us in enough time then that culture just might survive the environmental devastation wrought by capitalist consciousness. That of course remains uncertain. The path ahead is being laid and it's now up to us to walk the talk, or more than just individuals will die.

[Edward theurj Berge]

In the Afterword Rifkin expresses mixed feelings for the end of capitalism. He appreciates the entrepreneurial spirit that animated it. He thinks that it is in fact is the so-called 'invisible hand' and disagrees with Adam Smith that it involves pure self interest devoid of public concern. Such a spirit is driven by a need to create newer and better products and services to serve the public, which of course also serves one's own financial interests. And that capitalism was an appropriate and efficient response to the energy-communication regime of the times.

The irony is that the entrepreneurial spirit played out to its logical conclusion in creating products approaching near zero marginal cost. The Trojan Horse Darrell talks about was inherent to the system all along and created its own downward spiral toward extinction. That along with the other downsides inherent to the system, like creating monopolies, not sharing the wealth with workers and exploiting natural resources to the point of possibly disastrous climate change.

Granted the complete demise of capitalism is a long way off, it being mixed with the Commons for some time to come. The former will slowly subside as the latter rises. The second industrial revolution emerged when the first was in full swing. It took 50 years for the second to be the major economic system. It will likely take another 50 for the third revolution to be the dominant player. But the writing is already on the wall. It's here now and here to stay, so perhaps it's time to get with the program?