Wednesday, August 22, 2007

Economics is the Shadow Cast on Society by Technology

Jay mentioned a Dewey quote from the Democracy and Education lecture which, coincidentally enough, had been echoing through my head all day: "Politics is the shadow cast on society by big business."

For a long time I've felt much the same way myself, though I phrased it to myself rather less poetically, as: economics determines politics. That's not the full formulation, though, because if economics determines politics, then technology determines economics.

It's not cut and dry, of course. There's mutual feedback at all levels: politics can affect economics (to a degree), and technology (to a much weaker degree.) Similarly, economics can feedback to technology. But The ultimate direction of influence is technology -> economics -> politics.

A large part of Chomsky's lecture deals with the political changes that occurred between the founding of the US, and it's eventual emergence as an industrial superpower, and he's pretty unflinching in his judgment that those political changes were mostly for the worse. He places the blame for this primarily at the feet of the big corporations that have sought to neuter democracy in favor of establishing a technocratic state whose elites operate in total isolation from the humors of the masses.

But when the US was founded, the industrial revolution had yet to begin. With the exception of printing presses, gunpowder, and transoceanic sailing vessels technology was not terribly more advanced than it had been at any time in the past 2000 years. Most of the American population - or at least those who were allowed to vote - consisted of farmers (who owned their own land), and tradesmen (who sold things they made with their own hands.)

Advances in technology rendered that world almost obsolete within a hundred years: a single person simply can't build or operate a factory, or even design the products it turns out. Larger, semi-permanent organizations, in which people of their own free will agree to participate - corporations, in other words - have to be created out of sheer economic necessity. The development of corporations was a pretty huge thing in terms of the ability to organize human action over a large scale, probably one of the greatest social innovations of the past few hundred years.

Of course, corporations came with some societal costs that mirror the benefits. They reaped enormous economic benefit by harnessing division of labor on scales undreamt of before, but by doing that replaced a society of independent tradesman (whose work was interesting and challenging) with a society of factory workers, whose work was repetitive and often dangerous. As a natural result, the workers demanded greater compensation, and the owners (also quite naturally) resisted, leading to one of the great political tensions of the 20th century. At the same time, corporations thrive best under conditions of stable regulatory oversight; they can adjust to almost any ruleset, so long as those rules don't change very much. It was only natural that they would seek to subvert democracy as far as they could.

Chomsky says all this happened because of the mendaciousness of rich men and powerful corporations (generally the same thing, at least for the past hundred years or so.) I'd say the ultimate source was in technology. Steam engines, electrical power, mass production, these were things without which corporations would have been basically impossible, save in a few isolated fields.

Smith's goal of “creative work freely undertaken in association with others" is partly met by corporations, at least if you omit the 'creative' part. I think maybe this century, we'll be able to do better.

Once again, it comes down to technology. The pieces aren't all in place yet, but then the industrial revolution wasn't invented all at the same time either. The internet allows spontaneous networks to form around information that is instantly and universally available, a capability that was most certainly not part of the last century's experience. The maturation of the next two big technologies - solar power and home fabrication - are all that is required to complete the setup for the next massive social revolution.

Economics change pretty radically when you add home fabrication to the internet. Suddenly it's not just about downloading music and porn and looking at pictures of cats; now you can download blueprints and make your own technology, anything from a hammer to a cell phone to a house, including another copy of the home fabricator, dependent only on how much time you have. Decent solar power means that you can go out anywhere you want with a fabricator, a few solar panels, some raw materials (when the technology is mature, this will mean: dirt and sand), and build your own house from scratch.

The cost of manufactured goods trends very steeply down in this scenario, at least from the point of view of corporations; there's no point in building a global supply chain to mass-produce your widgets if everyone can just make their own at a cost of energy and raw materials. Essentially, companies that make things are fucked, unless they can find a way to force people to pay for the CAD/CAM files they download. The current IP struggles are deeply important because of this; if manufacturing companies succeed where media companies are failing so spectacularly, it'll do untold harm to the global economy by raising the cost of goods far above their logical price. I expect this to become one of the defining political battles of the 21st century: the fight between people who want to get paid for their creative work, and the vastly larger number who want it all for free.

Basically, it's a fight between corporations and networks, and in the long run I expect the networks to win, replacing corporations as the dominant form of social organization. Getting paid for your work will cease to lose all meaning, after a while: with the plans for everything freely available, and the ability to make as much of it as you'd like, the main incentive for inventing something new (ie, adding to the archive of blueprints) will be social recognition. This would seem to me to be pretty close to creative work freely undertaken in association with others, and long before this century is done I think we'll be moving very rapidly in that direction.

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Anonymous said...

I think you are missing something in your analysis. While existing designs may become a commodity and the network may win (e.g. unlimited free download and fabrication), there will be a place for novel and improved designs. Further, where reliability or safety are involved, there will be a place for sale of designs.
For instance, it is a trivial affair when a computer locks up because of defective software. The maximum loss is the data generated since the last backup. However, if your pacemaker fails, you lose yourself. Homes, cars, anything connected to a 120V outlet, drugs, and countless other objects in our life must be safe and reliable. Without a pedigree, certification, liability, or even reputation on a downloaded design, you are playing with your life.
I think there will be a place for large enterprises to innovate and sell those innovations because of these barriers. In other words, I believe people will forgo free stuff and pay for safe and reliable designs even if they fabricate the items themselves.

Keitousama said...

Design's the easy part. On the one hand, you've got a large number of people contributing to the archive; on the other, you've got people testing them out. Lots of eyeballs and lots of hands means bugs get picked out quickly, an open source principle I expect to be as good at error detection for physical devices as for software.

The biggest hangup will be workmanship, as for quite a while it probably won't be to quite the same quality as what a large corporation with dedicated production machinery can do. That's certainly very true of the fabricators that exist now, and it's likely to be true for quite a while. Once fabricators achieve the capacity to self-replicate their own parts, though, I expect they'll advance very quickly into machines that produce 'consumer' goods to the same standards as any corporation.