Curated Article: Sources to Understand the Emerging ‘Economy of Mutual Coordination’

Understanding the transition from an immature technosphere, which destroys the biosphere, to a ‘mature technosphere’, which lives in harmony with the biosphere.

The central theme of this newsletter is the emergence of a Fourth Generation form of civilization.

Think of the three preceding modalities as the

• Hunter-gathering modality

• The craft-agrarian modality

• The industrial-cognitive modality

In the first modality, humanity lived mostly on the organic fruits of nature, living in relative harmony with the natural and animal world.

The second modality was already a modality of productivity and mastery, based on the control and domination over natural forces. It was subject to boom and bust cycles at the local and regional level of civilizational life, but all through this period, Central Civilization, i.e. a network of cities living off the agricultural surplus, always persisted.

But the third modality creates a planetary crisis, it has globalized the over-use of material and organic resources, endangering the very survival of humanity.

Our task is therefore to shift from an immature Technosphere which overuses the planetary biosphere, to a mature Technosphere, which can live in long-term balance with the biosphere, likely for millions of years.

This is a shift in which we must somehow succeed in producing for human need, without the long-term exhaustion of our planetary ecological system.

This is of course a very complex task ahead of us, sometimes called the Metacrisis, and this article is concentrated on one aspect of it: how to envisage the technological and infrastructural basis of such a shift.

In our interpretation, this is very much linked to a change in ‘value regime’, i.e. how we extract and distribute value, from nature, as human society.

During the hundreds of thousands of years of hunter-gathering, the main value regimes were commoning and gifting. Commoning means exchanging with a whole or totality, i.e. when the Amish practice barn-raising to build a new house for a new couple, they do not expect anything directly in return, but only that the young couple in turn will participate in future barn-raising. The gift economy is based on a more clear expectation of an eventual return, to restore the balance between individuals, families and tribes.

But the civilizational model itself, which emerged perhaps 10,000 years ago, was based on a new value regime: that of markets and states as the main coordination mechanism. Markets and states are competitive and extractive institutions which over-exploit regional resources on behalf of civilization-building, more or less kept in check by the countervailing institution of generative commons. These operated as balancing institutions to minimize over-extraction at the local level, and played regenerative roles in times of civilizational decline, sometimes taken over completely as in dark ages, in which markets and states practically collapse.

The emergence of a hyper-efficient and global capitalist system, has fatally weakened the local commons, creating a commons-gap, that can no longer compensate for the over-extraction by global markets (trans-national finance), and the inter-national organization of capitalist states.

Hence the need to create cosmo-local commons institutions, at the planetary level, which can keep the production for human need, within the so-called planetary boundaries.

This article aims to make you familiar with the documentation available to understand this shift, based on the documentary material available in the wiki of the P2P Foundation.

So let’s look at the documentary record.

Introductory Materials

The P2P Foundation wiki has a section that is dedicated to documenting the planetary crisis.

You will find it here: https://wiki.p2pfoundation.net/Category:Thermodynamic_Efficiencies

That section describes the problem. But we of course want to focus on the solutions. For this we have a dedicated section on what we call Mutual Coordination Economics.

You will find it here: https://wiki.p2pfoundation.net/Category:Mutual_Coordination 

We believe it is important to have a historical understanding of the potential evolution towards a new civilizational format, so this is an outline of a historical interpretation:

• More or less 5,000 years ago, humanity underwent a first bifurcation in information processing for resource allocation, shifting from the gift and commons mechanics of the tribal organizations, to the markets and state allocation systems of craft-agrarian civilizations; the markets became dominant after the industrial revolution

• with the advent of computerized cybernetic technology, humanity stands at a potential second big bifurcation, moving from exclusively market and state allocation mechanisms, to introducing stigmergic mutual coordination through signalling in open ecosystems, with the post-world-war context of:

- the failure by the Soviet planning systems to adapt to cybernetic planning

- the failure of the first attempt at democratic cybernetic planning by Chile's Allende government with Cybersin and Stafford Beer

- the post-1993 democratizing of digital networking through the internet and the development of open source coordination systems, followed by the development of the crypto economic open ecosystems

• the second bifurcation is necessary to manage human needs within planetary boundaries and acceptable social contracts between the managerial and productive classes. We believe this will happen (in part) through the development of open crypto-economic infrastructures for mutual coordination, stronger mutualization of provisioning systems at the local level, the cosmo-local organization of production (interaction between relocalized supply and global knowledge cooperation), and Magisteria of the Commons, a new type of institution that can protect the reproduction of human and non-human life over the long term, by a more judicious use of scarce resources.

You might want to think of the more recent historical evolution this way:

• The 19th cy was the century of the hegemony of the market, i.e. the ‘laissez-faire’ doctrine, which accelerated progress but ended in the major crisis of WWI and WWII

• The first world war eliminated the imperial formats, leading to the hegemony of parliamentary and liberal systems; however it opened a new front between three contenders to manage industrial society: the parliamentary system, the Soviet alternative (all state, based on class dynamics), and the Fascist-Nazi alternative (corporate-state fusion, based on race or nation dynamics). Fascism was eliminated in WWII, but the Soviet system persisted until 1989.

• What came out of these two global conflicts was the compromise of the welfare state: a market that was regulated by a strong  social state; but was seriously weakened when the threat of the Soviet alternative disappeared from the horizon.

• Today, the market-centric Western forces are battling it out with the more state-centric countries of the East-Eurasian and Global South axis, i.e. the so-called ‘West vs the Rest’.

• What the commons movement represents is an emerging third force, that does not believe markets and states can self-regulate their innate extractiveness, and therefore needs a global countervailing force of cosmo-local, planetary scale commons-based institutions.

Until recently, there were five major options to consider coordinating an economy:

The five pre-crypto approaches were:

1. the status quo of the market order: this is based on a belief that state-based regulation distorts market signals which are by themselves sufficient to steer decisions

2. a return to central planning modalities: this is based on the opposite belief that market forces have become too strong, and are inherently selfish and geared towards private interest, so the state must retain its hegemonic role. This is the path followed by Russia and China presently.

3. bottom-up 'anarchy': this is the new localism, related to the older 19th century ideal of anarchism, a kind of federation of local communities, creating freely chosen upward coordination; there is a trans-local version of this in certain value preferences within crypto communities.

4. negotiated coordination mechanisms for democratic planning: this is a growing movement that believes the technology exists to re-introduce planning, but that unlike the previous Soviet and top-down experience, can be made democratic. The Parecon movement might be seen as an expression of this option, but it is getting non-cultic traction.

5. A new kid on the block if of course ‘algorithmic mediation, based on the belief that AI is now strong enough to do the job of coordination on behalf of humanity. This is sometimes called a Resource-Based Economy and the utopian Venus Project was an example of this dream, which also exists in neo-Marxist forms.

However, these pages are dedicated to a 6th proposition, i.e. the possibility of a global system  of mutual coordination in open ecosystems, assisted by regenerative market mechanisms, informed  by thermo-dynamic limits that are integrated in digital infrastructures. We call this  'context-based sustainability', it imagines a maximum amount of free decision-making but informed by the ecological limits, and allows for both democratic input and algorithmic mediation.

It also envisions the existence of ‘fourth-sector organizations’, i.e. digital containers which can coordinate market dynamics, the participation of public authorities and voluntary organizations, but more crucially, the input of permissionless contributions

We are asking you to imagine the following emerging reality:

• a first layer of production and distribution involves direct mutual coordination, through open and shared supply chains, with integrate accounting and metrics to recognize both positive and negative social and ecological externalities

• a second layer involves generative market transactions involving the various players in entredonneurial (generative entrepreneurs working together) coalitions that share common infrastructures and circular economies

• a third 'planning' layer that involves biophysical accountability, using tools like Kate Raworth's Doughnut, or the Global Thresholds and Allocations developed by initiatives such as Reporting 3.0

So how can you document yourself about this ? The next two sections offer reading suggestions, i.e. articles and books.

Guide to more detailed documentation: our article vault

This is an excellent summary of the pre-crypto developments, i.e. the five main approaches described above:

• Trajectories for Dealing with Allocative Efficiency, from Max Grunberg's synthesis: Optimal Planning and the Menace of Bureaucratisation.

On Planning

Here are three articles explaining why the centralized planning system, the Soviet model, eventually failed:

• InterNyet: Why the Soviet Union Did Not Build a Nationwide Computer Network. By Slava Gerovitch. History and Technology Vol. 24, No. 4, December 2008, [16]: "This article examines several Soviet initiatives to develop a national computer network as the technological basis for an automated information system for the management of the national economy in the 1960s–1970s.

• Why the Soviet Internet Failed? By Benjamin Peters. 2009. [17]: "Why wasn’t there a Soviet equivalent to the US ARPA NET? Building on fresh archival evidence, this paper examines several surprising leads

• Cybernetics for the Command Economy: Foregrounding entropy in late Soviet planning. By Diana Kurkovsky West . History of the Human Sciences, Volume 33, Issue 1 [18]

The following articles document the new potentials being created by AI and Big Data:

• EVGENY MOROZOV. Digital Socialism. The Calculation Debate in the Age of Big Data. New Left Review, Issue 116, MAR JUNE 2019 [20]

• Big Data, Platform Economy and Market Competition: A Preliminary Construction of Plan-Oriented Market Economy System in the Information Era. Binbin Wang and Xiaoyan Li. World Review of Political Economy, Vol. 8, No. 2 (Summer 2017), pp. 138-161 [21]

• Katharina Pistor, Rule by Data: The End of Markets?, 83 Law and Contemporary Problems 101-124 (2020) [22]: "explores data as a source and, in their processed variant, as a means of governance that will likely replace both markets and the law." See: Rule by Data as the End of Markets

• Democracy, ecology and Big Data. Can they be combined into a 21stcentury socialism? Kees van der Pijl. https://www.academia.edu/40678009/Democracy_ecology_and_Big_Data._Can_they_be_combined_into_a_21st-_century_socialism?]. See: Digital Socialism and the Preservation of the Biosphere: “This paper discusses the urgent need to define a socialism of the 21st century based on the achievements of the Information Revolution.

• Red Plenty Platforms. By Nick Dyer-Witheford. CULTURE MACHINE VOL 14 • 2013 [23]: "This paper takes Spufford’s novel as a starting point from which to embark on an examination of the computing platforms that would be necessary for a contemporary ‘red plenty’."

These are articles about the return of planning:

• The Planning Daemon: Future Desire and Communal Production. By Max Grünberg. Historical Materialism:1-45 (forthcoming 2024) [25]: "Within the planning discourse two poles have materialized over the last decades: a participatory ideal guided by substantive rationality, opposed to an algorithmic governmentality subordinated to instrumental reason. This rift within socialist thought is also observable when it comes to the discovery of needs." For more, see: Planning Communal Production on the Basis of Individual Consumer Preferences

• On the feasibility of techno socialism. By Peter J. Boettke and Rosolino A. Candela. Journal of Economic Behavior & Organization, Volume 205, January 2023, Pages 44-54 [26]. For more, see: Computer Advances Cannot Replace the Market-Based Discovery Process

• Three Models of Democratic Economic Planning: Comparies: 1) Devine & Adaman's negotiated coordination annual planning; 2) Albert & Hahnel participatory economics annual planning; 3) Cockshott and Cottrell's computerized central planning diagram

• From red spirit to underperforming pyramids and coercive institutions: Michael Polanyi against economic planning. By Gábor István Bíró. History of European Ideas, Volume 48, 2022 - Issue 6, Pages 811-847, 2021 [27]: "mathematics is not sufficient in itself to properly address the economy. Eventually, Polanyi developed an institutionalist approach in order to be able to address both the variability of market economies and the failures of socialist ‘super-planners’." For more, see: Michael Polanyi's Critique of Economic Planning

• The 'libertarian' free market critique from Ludwig von Mises: [28]

Emergent Stigmergic Infrastructures of Mutual Coordination

• In this key article, Tiberius Brastaviceanu on Why We Need a Contribution Accounting System , the author explains the relation between Contribution accounting and network resource planning

• Jordan Hall: Four Problem-Solving Methods in the History of Humanity, up to the 'DAO moment'

• The Role of Metadata and the Blockchain in Open Supply Chains for Distributed Manufacturing. By Orestes Chouchoulas.

• Ecological Institutions → Protocols to Grow Autonomous and Convivial Ecological Actors. Austin Wade Smith. Regen Foundation, 2024. [29]; Topic: "autonomous and convivial ecologies". More at Protocollary_Ecological_Institutions.

• Austin Wade Smith. Commons Sense - An Introduction to DAOs as Ecological ↔ Digital Linkages. [30]: (the human, the natural, the technological, three in one coordination mechanisms). More at: Making the Non-Human World Legible Through Technology.

Guide to more detailed documentation: our book vault

On Cybernetic Planning

Background

• Rise of the Machines: A Cybernetics History. Thomas Rid, is considered to be a good treatment of the history of cybernetics.

The Failed Cybernetic Experiments in the Soviet Union

• Red Plenty, by Francis Spufford is a 'faction novel' about the invention, and abandonment of the Russian internet for cybernetic planning.

• How Not to Network a Nation: The Uneasy History of the Soviet Internet. By Benjamin Peters. The MIT Press, 2018 [33]: "How, despite thirty years of effort, Soviet attempts to build a national computer network were undone"

• From Newspeak to Cyberspeak. A History of Soviet Cybernetics. By Slava Gerovitch. MIT Press, 2004. [34]: "In this book, Slava Gerovitch argues that Soviet cybernetics was not just an intellectual trend but a social movement for radical reform in science and society as a whole. Followers of cybernetics viewed computer simulation as a universal method of problem solving and the language of cybernetics as a language of objectivity and truth. With this new objectivity, they challenged the existing order of things in economics and politics as well as in science."

• Economic Cybernetics. By Nikolai Veduto. 1971.

The weaknesses of the 20th Cy Planning Economies

• Collectivist Economic Planning: Critical Studies on the Possibilities of Socialism. Edited with an Introduction and a Concluding Essay by F. A. Hayek. Contributions by N. G. Pierson, Ludwig von Mises, Georg Halm, and Enrico Barone. London: George Routledge & Sons, 1935. pdf. See: Critical Studies on Collectivist Economic Planning. This is the market libertarian critique of planning the economy as such.

• Recommended by Katarina Pistor: "For a comprehensive analysis of the weaknesses of the socialist system", see JANOS KORNAI,THE SOCIALIST SYSTEM: THE POLITICAL ECONOMY OF COMMUNISM (1992). [35]

Defenses of Planning Approaches

• Socialist Economic Development in the 21st Century. By Alberto Gabrielle and Elias Jabbour: "draw upon the examples of China and Vietnam".

• Solving the Global Crisis Requires the Approach of Economics Cybernetics. By Elena Veduta. "The book researches the mythology and practice of UN National Accounting Systems, the economic planning of the USSR and the World Bank. It contains a presentation of the dynamic model of interbranch-intersectoral balance as a system of algorithms which coordinates the orders of final customers (state, households, exporters) with producers' production possibilities. Only this system of algorithms can be used as a cybernetic digital platform for efficient decision making of state and global management."

On Market Mechanisms

• Markets in the Name of Socialism. The Left-Wing Origins of Neoliberalism. By JOHANNA BOCKMAN. Stanford University Press, 2011. [36]

Post-Monetary Coordination

• Society After Money. A Dialogue. By: Project Society After Money. Bloomsbury, 2019 [37]: "How can we conceive modes of production and coordination that no longer rely on money, markets and the state?"

• Stefan Heidenreich. Money. Merve Verlag, 2017. [38] See: Stefan Heidenreich on the Post-Currency Non-Money Economy

Today: Platforms, Crypto and Beyond

• Platform Socialism, from James Muldoon; and Blockchain Radicals from Joshua Davila discuss the potential of respectively platform cooperatives and crypto networks for economic planning and distribution.

• Peters, M. A., Besley, T., Jandrić, P., & Zhu, X. (2020). Knowledge Socialism. The Rise of Peer Production: Collegiality, Collaboration, and Collective Intelligence. Singapore: Springer.

Neo-Socialist Approaches

• From Needs Profiles to the End of Capitalism : Information Technology and Socialist Construction: The end of capital and the transition to socialism. By Daniel E. Saros.

• 1) Towards a New Socialism. by Paul Cockshott, Allin F. Cottrell. ; 2) Economic Planning in an Age of Climate Crisis. By Paul Cockshott, Allin Cotrell and Jan Philipp Dapprich.

• Computers and Socialism. by Stephen Bodington. Spokesman Books, 1973: "Will computers be the agents of a new authoritarianism, more thorough and unassailable than anything yet known? Or will they open the way to human liberation?"

• "Information Technology and Socialist Construction – The End of Capital and the Transition to Socialism". By Daniel Saros. See the 2-part video interview: Daniel Saros on Digital Socialism and the Abolition of Capital; [39]

• The Classless Society in Motion. A New Theory of Communist Economy. By Donal Costello and Tom O’Brien.[40]: See: The History of Socialist Economic Planning

• The Rise of Technosocialism. By Brett King and Dr. Richard Petty. [41]: on "the rise of a technology-driven collective social consciousness and purpose".

Conclusion: What about the sixth modality of stigmergic coordination using crypto infrastructure ?

Open source created the capacity of coordinating labor at the global scale, outside of the control of markets and states. The crypto economy and its infrastructure is in the process of creating the potential to pay for that labor, and to manage and distribute other physical resources as well, in a unified planetary ledger.

Please have a look at our material on evolving Crypto Governance infrastructures:

• https://wiki.p2pfoundation.net/Category:Crypto_Governance

Here is our material on the emerging Crypto Economy:

• https://wiki.p2pfoundation.net/Category:Crypto_Economy 

Here are some further potential insights about the sixth form of solutions to mutual coordination:

Our approach marries 'mutual coordination' mechanisms in the commons, such as open and contributive accounting and shared and circular 'eco-systemic' supply chains, perhaps using REA accounting and verification through shared universal shared ledgers like the holochain; just pricing and exchange mechanisms in the sphere of the ethical and generative market; and a planning framework based on Thresholds and Allocations proposed by global resource commons institutions.

0. What market pricing is to capitalism and planning is to state-based production, mutual coordination is to commons-based peer production!

1. Today we have the emergence of a new proto-system of production, Commons-Based Peer Production in which contributors are free to contribute to a common pool of shareable knowledge, code and design, which may be associated through physical production in microfactories using distributed machinery such as 3D printing.

2. This emerging new system of value creation and distribution is not sustainable if contributors need to find work as labour for capital, so contributors need to be able to generate livelihoods for themselves, keeping the generation of surplus value within the sphere of the commons and its contributors.

3. To achieve this, we advocate the use of Commons-Based Reciprocity Licenses such as the Peer Production License. This allows for the creation of a non-capitalist 'counter' economy based on Open Cooperativism and other forms of an ethical economy. In this proposal, the commoners or peer producers, i.e. the contributors to the commons, are also cooperators of their own corporate entities, which create livelihoods and insure the surplus value remains within the commons. So, in between the sphere of the accumulation of the commons (open input, participatory process, commons-oriented output), and the sphere of capital accumulation, there is a intermediary sphere of cooperative production, which regulates physical production and the social reproduction of the commoners-cooperators.

4. The production of immaterial common pools is already regulated through mutual coordination and stigmergy, i.e. coordination based on open and transparent signals of what is needed by the system; but physical production cannot be coordinated without similar signals, i.e. the coordination of production through information. It is therefore a next logical step to advocate and practice, within the ethical entrepreneurial coalitions that coalesce around particular commons through their shared adherence to the commons-based licenses, to also practice open accounting and open supply-chains and logistics. This means that within these coalitions, physical production can also be coordinated through stigmergic signals; and negotiated coordination and even voluntary common planning can take place on the basis of the shared production information.

In conclusion: We Need To Evolve Towards Fifth Magisterium of the Commons, based on a Contributory Value Regime, in order to create a steady-state Mutual Coordination Economy.

It could be argued that since the Industrial Revolution, our societies have been managed by four relatively autonomous magisteria (a science regulating empirical production, a culture regulating public discourses, a politics regulating state allocation, and an industry regulating private/pragmatic production. In our previous work, P2P Accounting for Planetary Survival, we have described a shift from a commodity value regime to a contributory regime, which is co-emerging with three new types of accounting (contribution/impact; flow/ecosystems; and thermodynamic matter/energy), which on the one hand expand the sphere of free and open coordination to the sphere of material production, while creating a new magisteria, that through accounting can be integrated in contextual (bioregional) decision-making at every level of subsidiarity, i.e. a relatively autonomous informational commons (f.e. a global thresholds and allocations council) that reflects the limits set by the interests of the interdependent web of life. In other words, we need to institutionalize the human and natural commons and give them a proper Voice. We will explore our further findings about such a potential cyber-physical infrastructure through which Anthropocene humanity can produce for its needs, in the context of a vocal and orchestrated voice for the interdependent web of life to which it can be held accountable.