Someone said money is humanity's most successful story. However, it has led to us becoming unable or unwilling to accept the humanity of others. It has alienated most of us from our rich historical communities and from our very own humanity. Given that money has become a dominant factor in our society, our economy has been commodified to the point that we no longer accept one another's humanity. The financial system has become dysfunctional because many of our governing institutions have been captured by the winners of the game.
The top one percent of wealthy individuals tell their minions stories that makes them the heroes whose super-profits are justified by their super-productivity, when the only thing super is their ability to garner excessive rents. Then the minions step in to redefine excessive rents as productivity, and then they use anything to distract from the theft from the commonwealth.
These wealthy individuals have successfully installed their story throughout mainstream media and established their orthodoxy as a virtual monopoly in economic journals. We need a new story of money, ie, an entirely new ontology of value, production and ownership; one that gives credit where credit is due, that gives recognition for valued contributions, for acts of leadership and compassion, vs. an ontology of rewards. Otherwise we are stuck in a narrative that credits the wealthiest amongst us for winning? For being the best predator? For greed? This system alienates us from our deepest values, from our desire to contribute to something greater than oneself.
I don't intend to spend a lot of time on the old story, except to highlight where it needs to change. This is not to say that we should ignore history. It is important that we draw from our collective heritage to understand how money systems are responsible for the good and bad experiences within our society so that we can inform design and change.
At the same time, we need a new story and we will need to create a story that works for all. Since the story is based on new ontologies, we will need to come up with new ways to describe our society. Sometimes old words bent to a new context, and sometimes we may feel compelled to come up with brand new words. We need to be conscious of the words we use. For instance, is it a reward or recognition? How are they different as currencies? We may find we need both, at least while we are in transition to the new institutions.
For example, a commons may want to give both rewards and recognition for contributions. We can imagine a future in which our basic needs no longer depend on each of us individually securing enough currency to pay the bills. If you get a bill, it is for your information and maybe approval/acknowledgement, but there is no tradable currency exchanged in the transaction. But that is an imagined future.
Right now, there is a shrinking allocation of the system currencies by the winners for the rest of us to thrive, and therefore many/most of the potential contributors to any commons need to earn a living, and therefore in addition to the recognition of the value of the contribution there would be the possibility of rewards. Even so, we design the system based on recognition of contributions. You can't spend recognition, but you can provide for a person, or even his whole family can receive rewards, or even better, benefits, based on recognition and similar currencies. We may need a new word that captures how this type of currency attaches to specific people and events, and the flow is an emergent history of each next new recognition. Like a Nobel Prize or an Olympic Medal; even if pawned or sold, it confers no honor on the new "owner".
In our imaging of currency-free futures, maybe not so much free as invisible, money is still built into each interaction that is economic in that it connects to the systems of production and consumption and not just the accounting part of the economic life of families and clans. Economics, in the original sense of the Greek root, related to households which were by implication at the center of ancient family life and its continuity as a unit. We need to better understand that the independent self-sufficient individual is more myth than reality. In this context, the currency system would be the public accounting system. The technology is ready to impliment systems that are open and transparent, and, at the same time, make sure they are private and secure.
These critical design features cannot be achieved without openness and transparency on the part of the implementing and operating institutions; therefore, this project can only be built in the commons with open source software and devices such that all of it can be reviewed continuously by all. Such a system will produce a digital trace of each of us that could become oppressive in dystopian futures that seem to be arriving tomorrow. If we don't build the version of this that leaves room for our humanity, we will certainly get the other version that doesn't.
We are living in a time where individual freedoms have been emphasized in contrast to a deeper past where most human beings are embedded in very tightly bound social groups. Individuality only existed within what was mostly a very limited local context. Human beings don't make sense as isolated individuals; we are more social in more ways that any other species. Our languages no doubt evolved under social pressures of our pre-human ancestors having shifted to economic lives that require cooperation. We needed to cooperate to raise young who were dependent for much longer and needed richer diets to complete their development. We need to be able to use the power we get from acting collectively with the creativity available from much more individual freedom.
The future we are careening towards will use the ubiquity of information about us as individuals to tailor a bubble for each of us. The bubble that will connect us to the Matrix, which exploits our programmed desires and tendencies, so that they can fully capture the bits of our life force they need and simultaneously bottling up our creative force such that it cannot establish its autonomy. To recapture and free our inidvidual autonomy we will need to retool our natural capacities to align and harmonize our individuality with group purpose.
The difference between the dystopian future we seem to be rushing towards as opposed to turning the elements of the so called singularity towards more human ends will come down to who decides. Will it be the oligarchs of an increasingly imbalanced economic world or the people? We must become committed to democracy from the bottom up. Starting from small group formation and building intermediate networks will eventually connect to expertise-based advisory groups. The leadership of each level is being supplied, probably in rotation, from the levels below. In this context, government for the people and by the people might finally begin to flourish.
Commons Capital Formation
The original commons is the Earth as experienced by our ancestors for as long as we had the words and creative spark to invent a creation story for their people. We receive the gifts of the earth and give thanks to what we imagine created all of it. For most of us, how we imagine creation may have shifted, but the need to acknowledge our natural inheritance and the vast mystery of the world has not diminished. In commons formation, the debt to inheritance will always dwarf any current infusions; therefore, we use the ontology of gifts vs. trade. We can introduce trade in the products of the commons, but keep in mind that most people until very late historically, are largely living off the commons.
A better understanding of the history of money and capital formation will help us evolve new institutions that better serve productivity than accumulated power. Coinage for trade and local markets are historically created to pay for public goods. Coinage is issued, paid to support state activity (war, public building) and then the money is taxed out to be cycled again. A very similar model can be used in bootstrapping commons based organization.
Simply shifting to a commons based banking system may be the best way to frame this change. Christine Desan proposes that the post office become a low cost banking system for everyone. Such a bank could govern a commons based investment system as well. Again, it is critical that the implementation and operations of these institutions is governed by open and democratic processes. We can have confidence that the institutions will be run to serve the public interest.
Each commons credit union would implement a branch of a central mutual credit/savings bank that would provide all the financial services for the commons. Each commons would develop currencies and governance structures appropriate to its production and delivery operations; furthermore, governance would regulate money supplies and investments for the good of their producers. Well designed commons based production spaces will need to be naturally self-sustaining, but we will have to prove that in practice. What is the best governance structure for a production common? We will need to try many approaches and learn from existing institutions that already are stewarding healthy commons based spaces.
We may want something like stock in the commons. Not in the sense that it represents a gift, but more like an endowment. What is important is that the big endowment might be recognized in social power, but not governing power. In other words, we want democracy where all voices count. We want everyone who has something to say to be heard, and one person, one vote for most decisions. Maybe producers pay a premium based on commons use/production unless they have a certain quantity of endowment certificates. Exactly this sort of thing is getting proposed for blockchain currencies, although they frame it as "discount tokens" instead of a premium on non-token holders.
Currencies for Contributions
We want to distinguish between the work of building the commons, adding knowledge and capacities, from operating shared infrastructure. The latter is part of production and the flows of production will need to support it as part of ongoing costs of production. The former is best thought of as part of capital formation. We need to recognize the deeply creative and community serving work of all the contributors by giving particular recognition to the work found to be most valuable. These may be the contributions that enabled great efficiency and effectiveness of the producing peers, but they may also be what most pleases us or what is considered virtuous in other ways valued by some or all.
One aspect of the new money is the digital trail that it leaves. A current state of a blockchain ledger inplicitely includes the entire chain which is a history of all the transactions it holds. The money we know is immediately alienated from its source in each transaction, the history is only important to the extent that transactions are not complete. You have credits and debits with many agents until the accounts are all settled and closed. Each step is formal and final, admitting no further negotiations or settlements. Reversing an entry requires new entries.
While some may think to turn to digital currencies for anonymity and even secrecy, the trail of breadcrumbs means that the flows we participate in are never really alienated from their sources. We give a gift and make a contribution that results in transactions added to blockchains. It is permanently associated with my digital identity, and, by implication, to my human agency. In the future the appreciation and accumulated value connected to my early contributions never end, and my identity and reputation are forever linked to my contributions.
One design option for capital currencies would be more like loans than outright gifts. There is a gift to be recognized for investing without interest, giving the sort of slow investment that communities really need. If you issued currencies with an expiration, then they are redeemed like a bond with no interest, or even negative interest. As discussed previously, contributors would be recognized with contributor currencies, and then these currencies would be connected to other currencies issued with respect to past recognition. Unlike patents and copyrights that are both limited and often alienated from the actual creative workers, the accumulated recognition represented as a currency cannot be taken away.
Production Currencies
Any currencies used to measure production, allocate costs and revenues, track and validate assets, and provide for the execution of transactions in supply chains and similar financial structures to support networked distributed production will also not limit the flexibility of currencies being matched to their networks, products and producers. In many cases, it will be a simple matter of assessing fees from a fee schedule in a production currency to fund operation and provide a surplus to be used to either redeem ownership tokens for reinvestment or to directly reinvest in this and other commons based organizations to fund their growth.
Currencies for Governance
The need for renewal in the commons of democracy is a driving motivation for this work, and now we come to the process of governing the commons itself. If it is a simple matter of deciding and evolving the fee structure and distributing the surplus, then the systems of governance can be simple; support a few proxy votes each year to approve changes and rarely any controversy. Not every commons will be that simple, ranging from the equivalent of small to medium size companies right up to the scale of nations and multi-nationals.
Each commons that we attempt to build is an experiment in collaborative systems and social organizations, and we can accumulate them in knowledge bases and actualize them in networks of practice where they can evolve and extend the effectiveness of the whole network. We expect that we will fail more than we succeed, but hope that we learn from each attempt and do better each time. There is also a lot to build on. Many are aware of the great challenges that must be addressed in the future, and are not waiting for directives to tell them what to do. We need to find each other, secure collective resources in existing institutions, and found the new institutions.
We are already doing all of this in parts, each within one or more contexts, and yet it seems it will not be enough. On the surface it might seem like too little, too late, but I don't think so. Market fundamentalists are dead wrong in their claims that free markets solve everything. Furthermore, the oppressive aspects of current institutions are undeniable. However, there is a kind of market magic that is described by classical econimists that we don't want to lose. Markets work. They are a kind of collective intellegence, but 1) the free property is a public good and 2) they can fail, their stability is fragile, or maybe more accuratley, chaotic.
We don't spend many words at markets; that is what is implicit in the flexible system of production currencies where supply chain networks create very dynamic systems of trading currencies to 1) accuratly represent costs of components 2) track fair trade practices throughout the chain, 3) provide signals to regulate flows and collaboratively manage inventories. Every production context can be completely different, and can have completely different currencies involved. Because of the distinct properties of these currencies, they leave a trace the way the old currencies don't. We uncover opportunities for work done in the commons to make the entire chain more productive. In the current financial system, the benefits of such an improvement would probably go to a large firm that is able to do this within their firm. However, our system would not only share the benefits either by investing more in common efficiency or reducing fees for commons services, but also provide new opportunities for producers. To understand this, recognize that the commons based improvements may function by classical market operation; for example, new opportunities to create value in mining production data flows for the data needed for efficiency. In other words, the commons might create markets for specific information that is valuable, or for doing things that enhance the responsiveness of the nework.