Here’s a great post from a bit more than a year ago at Anomalous Presumptions (2007-02-26), which I just got around to reading:

I was responding to this key point:

[P]eer production isn’t an assault on the principles of a free society, but an extension of those principles to aspects of human life that don’t directly involve money. ….

[A] lot of the intellectual tools that libertarians use to analyze markets apply equally well to other, non-monetary forms of decentralized coordination. It’s a shame that some libertarians see open source software, Wikipedia, and other peer-produced wealth as a threat to the free market rather than a natural complement.

Since peer production is an entirely voluntary activity it seems strange to view it as a threat to the free market. (My interlocutors in the comments demonstrated that this view of peer production is alive and well, at least in some minds.) So how could this opinion arise? And does it indicate some deeper issue?

I think viewing peer production as a threat is a symptom of an underlying issue with huge long-term consequences: In peer production, the interests of capitalists and entrepreneurs are no longer aligned.

[…]

For example, Linus Torvalds is a great entrepreneur, and his management of the Linux community has been a key factor in the success of Linux. Success to an entrepreneur is coordinating social activity to create a new, self-sustaining social process. Entrepreneurship is essential to peer production, and successful entrepreneurs become rock stars in the peer production world.

A capitalist, by contrast, wants to get a return on something they own, such as money, a domain name, a patent, or a catalog of copyrighted works. A pure capitalist wants to maximize their return while minimizing the complexity of their actual business; in a pure capitalist scenario, coordination, production and thus entrepreneurship is overhead. Ideally, as a pure capitalist you just get income on an asset without having to manage a business.

The problem for capitalists in peer production is that typically there is no way to get a return on ownership. Linus Torvalds doesn’t own the Linux source code, Jimmy Wales doesn’t own the text of Wikipedia, etc. These are not just an incidental facts, they are at the core of the social phenomenon of peer production. A capitalist may benefit indirectly, for a while, from peer production, but the whole trend of the process is against returns on ownership per se.

Profit

Historically, entrepreneurship is associated with creating a profitable enterprise. In peer production, the idea of profit also splits into two concepts that are fairly independent, and are sometimes opposed to each other.

The classical idea of profit is monetary and is closely associated with the rate of (monetary) return on assets. This is obviously very much aligned with capitalist incentives. Entrepreneurs operating within this scenario create something valuable (typically a new business), own at least a large share of it, and profit from their return on the business as an asset.

The peer production equivalent of profit is creating a self-sustaining social entity that delivers value to participants. Typically the means are the same as those used by any classical entrepreneur: creating a product, publicizing the product, recruiting contributors, acquiring resources, generating support from larger organizations (legal, political, and sometimes financial), etc.

Before widespread peer production, the entrepreneur’s and capitalist’s definitions of success were typically congruent, because growing a business required capital, and gaining access to capital required providing a competitive return. So classical profit was usually required to build a self-sustaining business entity.

The change that enables widespread peer production is that today, an entity can become self-sustaining, and even grow explosively, with very small amounts of capital. As a result it doesn’t need to trade ownership for capital, and so it doesn’t need to provide any return on investment.

As others have noted, peer production is not new. The people who created educational institutions, social movements, scientific societies, etc. in the past were often entrepreneurs in the sense that I’m using here, and in their case as well, the definition of success was to create a self-sustaining entity, even though it often had no owners, and usually produced no profit in the classical sense.

—Jed Harris, Anomalous Presumptions (2007-02-26): Capitalists vs. Entrepreneurs

The only thing that I would want to add here is that it’s not just a matter of projects being able to expand or sustain themselves with little capital (although that is a factor). It’s also a matter of the way in which both emerging distributed technologies in general, and peer production projects in particular, facilitate the aggregation of dispersed capital — without it having to pass through a single capitalist chokepoint, like a commercial bank or a venture capital fund. Because of the way that peer production projects distribute and amortize their costs of operation, entrepreneurs can afford to bypass existing financial operators and go directly to people with $20 or $50 to give away and take the money in in small donations, because they no longer need to get multimillion dollar cash infusions all at once just to keep themselves running: the peer production model allows greater flexibility by dispersing fixed costs among many peers (and allowing new entrepreneurs to easily step in and take over the project, if one has to bow out due to the pressures imposed by fixed costs), rather than by concentrating them into the bottom line of a single, precarious legal entity. Meanwhile, because of the way that peer production projects distribute their labor, peer-production entrepreneurs can also take advantage of spare cycles on existing, widely-distributed capital goods — tools like computers, facilities like offices and houses, software, etc. which contributors own, which they still would have owned personally or professionally whether or not they were contributing to the peer production project, and which can be put to use as a direct contribution of a small amount of fractional shares of capital goods directly to the peer production project. So it’s not just a matter of cutting total aggregate costs for capital goods (although that’s an important element); it’s also, importantly, a matter of new models of aggregating the capital goods to meet whatever costs you may have, so that small bits of available capital can be rounded up without the intervention of money-men and other intermediaries.

The article also has an excellent coda on the way that Intellectual Protectionism threatens to give a government-backed prop to lingering capitalistic modes of production, by hobbling the emergence of entrepreneurial peer production based competition:

The conflicting incentives of entrepreneurs and capitalists come into sharp focus around questions of intellectual property. One commenter complained about open source advocates’ attacks on software patents, … the DMCA and … IP firms. These are all great examples of the divergence between ownership and entrepreneurship.

The DMCA was drafted and lobbied into existence by companies who wanted the government to help them extract money from consumers, with essentially no innovation on their part, and probably negative net social value. In almost every case, the DMCA advocates are not the people who created the copyrighted works that generate the revenue; instead they own the distribution systems that got those works to consumers, and they want to control any future distribution networks.

The DMCA hurts people who want to create new, more efficient modes of distribution, new artistic genres, new delivery devices, etc. In general it hurts entrepreneurs. However it helps some copyright owners get a return on their assets.

The consequences of patents and other IP protection are more mixed, but in many cases they inhibit innovation and entrepreneurship. Certainly patent trolls are an extremely clear example of the conflict — they buy patents not to produce anything, but to sue others who do produce something. Submarine patents (like the claimed patents on MP3 that just surfaced) are another example—a patent owner waits until a technology has been widely adopted (due to the work of others) and then asserts the right to skim revenue from ongoing use.

[…]

All of these issues, and other similar ones, make it harder for small companies, individuals and peer production projects to contribute innovation and entrepreneurship. Large companies with lawyers, lobbyists, and defensive patent portfolios can fight their way through the thickets of intellectual property. Small entrepreneurs are limited to clearings where they can hope to avoid IP problems.

Conclusion

Historically many benefits of entrepreneurship have been used to justify capitalism. However, we are beginning to see that in some cases we can have the benefits of a free market and entrepreneurship, while avoiding the social costs imposed by ensuring returns to property owners. The current battles over intellectual property rights are just the beginning of a much larger conflict about how to handle a broad shift from centralized, high capital production to decentralized, low capital production.

—Jed Harris, Anomalous Presumptions (2007-02-26): Capitalists vs. Entrepreneurs

… by using the force of law to try to prevent Georgia State University students from accessing works of science and the useful arts unless they pay $50–$100 a pop to go through an academic publishing racket for obscure books with little resale value.

(Via Roderick Long @ Austro-Athenian Empire 2008-05-21.)

Please note that in the real world, outside the fever-dreams of academic publishers, sharing books and articles is an essential part of the life of a research university. Besides lending the book itself, every department has a copy machine, and every professor uses it, quite often, to run off paper copies of articles or chapters that they give away to their students. I have a file box with easily several thousand pages worth of xeroxed articles that I accumulated over the course of my college career. Or, if the professor doesn’t have the book herself, or doesn’t want to put the xeroxes on her tab with the department, every University library has self-serve xerox machines and a book-reserve system, where the professor can ensure that a copy of the book is always available for students to share with each other, and to xerox the relevant sections out of if they want to take it back to read on their own time. And all this is available even though professors could have forced each and every student to go down and pay for the $50-$100 anthology at the University bookstore.

Are these godless commies and lying, thieving mutualists that infest the Academy stealing from poor, innocent academic publishers by passing around xeroxes? No; all it is is that they aren’t insane, and they are aware that supporting some particular academic publisher’s business model is not their students’ responsibility.

Yet as soon as the University eliminates the paper medium, and facilitates exactly the same thing through an non-commercial, internal University course pack website — which does nothing at all more than what the xerox packets did, except that it delivers the information to pixels on a monitor instead of toner on a page — the publishers’ racket can run to court, throw up its arms, and start hollering Computers! Internet!, send their lawyers to try to shake down have a discussion with the University administration for new tribute to their monopoly business model, and then, failing that, utterly uncontroversial decades-old practices of sharing knowledge among colleagues and students suddenly become a legal case raising core issues like the future of the business model for academic publishers, while even the most absurd protectionist arguments are dutifully repeated by legal flacks on behalf of sustaining the racket. (Thus: It’s difficult to argue that this is a truly noncommercial use [even though Georgia State receives no money from students for the course packs]. Georgia State may be a nonprofit institution, but its students pay a lot of money for course materials, and would presumably pay money for the materials being provided to them by the university.)

A few years ago, when I was living in Ypsilanti, I sat in on a seminar over at the University of Michigan on Frege, Russell and Wittgenstein. There were a few textbooks to buy at the University bookstore (most of which I already owned), but a lot of the reading consisted of articles collected into a xeroxed course pack of anthologized articles. To get the course pack you went down to this copy shop in downtown Ann Arbor where the professor had left the master copy for the course pack. You paid Excel a fixed fee for the course pack; they took down the folder with the masters from the shelf, and then escorted you to a self-service copy machine where you had to mash the Copy button in order to make the copies yourself. Then you gave the copied sheets back to them at the counter, where they would take the copies you made back and bind them for you.

The reason that you, personally, had to push the copy button is because xeroxing articles out of books for the purposes of a class is legally speaking, completely non-controversial, but if you paid exactly the same amount of money, and the copy shop did exactly the same thing, except that an employee mashed that Copy button at your behest instead of making you do it yourself, the elimination of that minor inconvenience to the student would instantly convert the transaction from non-commercial to commercial copying, and thus expose the copy shop to a crippling lawsuit, as actually happened to Michigan Document Services in Ann Arbor back in 1992.

So, to be fair, I suppose you can credit the Intellectual Protectionists with fostering knowledge and innovation in one respect: by relentlessly attacking any sharing practice that they can get away with attacking, and exploiting any technological change in order to chip away and obliterate as much of traditional fair use protections as they can manage, have produced an absurd dynamic in which basically identical transactions are treated as radically different from one another, in courts of law, such that, in order to avoid lawsuits, academics, libraries, and copy shops have been forced to invent all kinds of creative new ways of splitting hairs and engaging in the most ridiculous sorts of casuistry just to keep on doing what teachers normally do, while covering themselves from the threat of a ruinous lawsuit.

Thanks, Intellectual Protectionism!

Oh, and by the way.

Incidentally, in case you are interested, the academic publishers currently suing Georgia State University to try and force their students back into the academic publishing racket are Cambridge University Press, Oxford University Press, and Sage Publications. The publisher that went after Michigan Document Services in 1992 was Princeton University Press. Wouldn’t it be interesting—a funny sort of coincidence, you know, one of those weird things that just happens in life when you were least expecting it—if bloggers committed to free minds and free culture just happened to start posting large quotes (of about 10-15 pages) from Cambridge, OUP, Princeton, and Sage books on their public, Google-searchable websites, under principles of fair use? All strictly for the non-commercial purpose of educating interested readers, of course. Wouldn’t it be interesting if it turned out that there was so much interest in talking about the topics covered in one of Cambridge’s, OUP’s, Princeton’s or Sage’s books that the whole book ended up getting posted, by a crazy series of coincidences, in protected bits and pieces on different websites, at the same time that those publishers are trying salvage their broken business model by mounting this massive screwjob on identifiable targets like innocent students at Georgia State?

The funny thing is, I was just thinking the other day that my readers here might enjoy learning some ordinary language philosophy, which might be illuminated by appropriate fair-use quotations from Stanley Cavell’s Must we mean what we say? (Cambridge University Press, 1976/2002), and some ancient moral philosophy, for which an absolutely essential source of appropriate fair-use quotations is Terence Irwin’s masterful study on Plato’s Ethics (Oxford University Press, 1995), and also some feminist political theory, which obviously demands taking a look at some key passages from Susan Moller Okin’s Women in Western Political Thought (Princeton, 1979). If you have a blog yourself, maybe you might find that your readers would be interested in discussing other key passages from those same books. Who knows? Or perhaps they’d be interested in discussions that other fine books from Oxford, Cambridge, Princeton and Sage happen to touch on.

I’m just sayin’.

Feel free to let me know what books you’re talking about with your readers about in the comments.

Over at LewRockwell.com Blog, Karen De Coster recently posted about Ford’s Camaçari assembly plant in Brazil, taking it as an opportunity to complain about the way union thugs [sic] run Ford’s business in Estadounidense assembly plants, and how Ford may have trouble introducing a similar manufacturing model in U.S. plants because the UAW is hesitant. Other than noting that the stories are little more than a couple of glorified Ford Motor Company press releases, passed off as journalism by the Detroit News, I don’t have anything in particular to say about the set-up Camaçari, or for that matter about Ford Motor Company or the UAW. (I consider the both of them to be brontosaurs of state capitalism — massive, slow, stupid, and probably doomed to extinction.) But I do want to mention De Coster’s boilerplate complaints against labor unions, and what they presuppose.

De Coster, like lots of other anti-union libertarians, claims that unions are economically harmful because they’re toxic to efficiency and flexibility. The idea is that organized workers will tend to use their organization to oppose advances like automation, technological upgrades, flexible job duties, and reorganization of processes for greater efficiency. Partly because union contracts tend to preserve old job descriptions in amber, to better mark off each worker’s turf, and partly because organized workers will use their coordinated bargaining power to oppose anything that reduces organized workers’ hours or introduces new, not-yet-unionized (or differently-unionized) jobs into the shop. I don’t necessarily find this complaint very persuasive. But. hell, let’s grant most of it, for the sake of argument. Suppose that a union like the UAW does tend to block upgrades for greater efficiency and flexibility. If that’s true, why is it true? Because the unionized workers don’t own the means of production.

It’s no surprise that there would be conflicts between the interests of the workers and the interests of the boss and board when it comes to innovation in shop-floor technology or processes. For a wage laborer, sometimes new technology and new processes mean easier and better work to do; often they mean that your hours will be cut or you’ll lose your job entirely. In any case they will be deployed and integrated into the flow of work according to what the boss finds most useful; they may very well result in you, as a wage laborer, getting stuck with speed-ups or harder work.

None of this is a decisive argument against innovations in shop-floor technology or processes; sometimes things have to change, and change can be hard. But it is a natural source of conflicts between labor and capital. When workers are organized — and when the goals of the organized workers are limited to eking out the highest hourly wages and benefits, the most reliable hours, and the easiest conditions, that they can get within the existing ownership structure and business model of the corporation, through stage-managed labor actions, back-room negotiations with the boss, and multiyear fixed contracts, while the boss and the board keep ahold of final control over conditions on the shop-floor and most or all of the residual profits from any efficiency improvements, what you’ll tend to see is a perpetual collision between a small but powerful coterie of managers and owners, who have every reason to try to shove new processes and technologies down their employees’ throats, to the extent that they can get away with it, and a consolidated mass of workers who have little reason to care about starving themselves lean in order to fatten profits that don’t go to them. Why should workers want to do more work faster, or to take on more flexible job descriptions, if they only stand to lose hours or subjected to speed-ups for their trouble? Both workers’ livelihoods and process efficiency get caught in the crossfire.

But the business model offered by that small coterie, and the union organizing model offered by that consolidated mass aren’t the only business models or union organizing models on offer, and the fact that they are so prevalent in American heavy industry today is the direct result of a series of political decisions and a system of government economic regimentation that allowed that business model and that organizing model to shove alternatives out of the way. Alternatives like that offered by the Industrial Workers of the World and other state-free wildcat unions, which called not for a fair day’s wage for a fair day’s work, but rather for abolishing the wage system, and replacing it with worker ownership of the means of production, coordinated through decentralized, participatory unions.

If the workers themselves jointly own the means of production, then the union has no reason to sandbag efficiency upgrades: if organized workers keep most or all of the residual profits then they have every reason to want more flexible job descriptions, more efficient processes, and greater integration of labor-saving technology. Maybe it’ll mean fewer hours of labor; but since the worker keeps the increased profits, the reduction of hours is a net gain rather than an economic blow. And if workers make agreements amongst themselves as to the conditions of their own labor, they have little reason to want their specific role in the shop written on tablets of stone, and little reason to fear new processes or technology which they are free to take up or not to take up on their own terms and at their own pace, rather than as dictated by a chain of command.

De Coster trashes the UAW for responding to the incentives that the wage system presents for their workers; but rather than getting rid of the UAW, the better solution would be to quit the griping and change the incentives. There is no natural connection between labor organizing, on the one hand, and Luddism or labor-contract sclerosis, on the other. It’s a matter of the artificially rigidified economics of state-subsidized corporate capitalism, and the artificially narrowed vision of the state-patronized establishmentarian labor movement. The only reason that centralized, state capitalist corporations like Ford find themselves confronting top-heavy establishmentarian unions like the UAW over efficiency upgrades is that the both of them have conspired — with the active patronage and regulatory encouragement of the United States federal government — to sustain a business model in which the vast majority of workers have no stake in, and thus little or no natural interest in, the efficiency of the shop, and little or no control over how new processes or new technology, if implemented, will affect the hours and conditions of their labor.

The solution isn’t more ruthless corporate union busting; the solution is to strike at the root of the problem, by abolishing the government economic regimentation that sustains both establishmentarian unionism and state capitalism. If the UAW is cut free from the smothering patronage of the State, and becomes what union so often were before the Wagner/Taft-Hartley era — a wildcat industrial union, free to play hardball and free to set its sights not just on negotiated wage and benefits settlements, but on the unionized workers themselves owning the shop, the machine and the tools — then King Ludd’s throne will crumble out from under him, and you’ll soon start to see unions that not only accept, but champion innovations in technology and industrial processes. If workers own the shop, why wouldn’t they want to increase their own efficiency? After all, they get to keep the difference.

See also:

• GT 2004-05-01: Free the Unions (and all political prisoners)!
• GT 2008-02-20: Over My Shoulder #41: Paul Buhle on establishmentarian unionism, the decline of labor organizing, and the rise of Labor PAC. From Taking Care of Business: Samuel Gompers, George Meany, Lane Kirkland, and the Tragedy of American Labor.
• GT 2005-12-30: Over My Shoulder #4: Paul Buhle’s Taking Care of Business: Samuel Gompers, George Meany, Lane Kirkland, and the Tragedy of American Labor
• GT 2005-12-09: Over My Shoulder #1 (or: Friday Book-Bragging)

… by legally prohibiting web designers from taking advantage of elegant standards-based methods for using their favorite fonts in web pages, unless the owner of the font has specifically written them a permission slip for that. Note that if I prepared a copy of the same document using desktop publishing software, and printed 1,000,000 paper copies to distribute by snail mail to Internet users, I would not be breaking any legally-imposed monopolistic restrictions on web embedding. If I then took one of those paper copies, scanned it as a PNG image, and then distributed that image through my website, I would not be breaking any legally-imposed monopolistic restrictions on web embedding, either. If, on the other hand, I try to do the right thing and make my content available to users in a standard hypermedia format that can be properly indexed, searched, reformatted for accessibility, etc., I would be putting myself at risk of a lawsuit. In other words, your web design can be either ugly, broken, or illegal. Pick one.

Thanks, Intellectual Protectionism!

(Link via John Gruber.)

Well, I feel kind of dumb.

But, first the good news.

I’ve recently added a new feature to the comments form on this blog. If you have an OpenID identity — and everyone who has a blog through WordPress.com or LiveJournal, or an account with AOL Instant Messenger, already has an OpenID identity — you can now use that to sign your comments on posts at radgeek.com (meanwhile getting a leg up on the comment spam filters).

OpenID is a free and decentralized system for using a single sign-in to vouch for your identity (or, if you prefer, your regular pseudonym) across many different websites. Because it is decentralized, you don’t ever have to turn any sign-in credentials over to this website, and your ID also remains good as long as your homepage exists — unlike single sign-in systems based on centralized providers like Microsoft or Six Apart, it doesn’t get compromised or killed if any one company goes under. It’s a neat project, and very useful for simple ID tasks like signing comments. So I figured I would do my part by enabling the use of OpenID on blog comments here. I downloaded the Alternate OpenID for WordPress plugin to handle the basics, and then set about hacking it to cover the details of how I wanted it to work.

So, the good news is that OpenID sign-ins are, as far as I can tell, up and running and ready for you to use. To use the feature, fill the appropriate URI into the URI field and then mash the button next to your URI to sign in using OpenID. Thus, for example:

• If you want to sign in under your WordPress.com blog, then you can just use the blog’s address for the URI (http://thisismyblog.wordpress.com/ or what have you).
• If you want to sign in under your LiveJournal account, then you can just use the LiveJournal’s URI (http://radgeek.livejournal.com/ or what have you).
• If you want to sign in under your AOL Instant Messenger screen name, then you can use a URI of the form http://openid.aol.com/MyScreenNameHere

After you mash the button, you’ll be shuttled over to your OpenID provider, where they will ask you to sign in, or whatever it is that they do to verify your identity. When you’re done doing that, you should be shuttled back to radgeek.com where you’ll now be recognized by your OpenID address. The OpenID plugin will try to create an intelligent user name to display based on the information you provide it, but if you don’t like the user name it supplies you with, you can click on the user name and edit your name (or any other part of your local record) to your heart’s content. Once you’re satisfied, you can return to the page and post your reply under your OpenID signature. Hooray!

Now, all that said and done, here’s the bad news. While I was tweaking the OpenID plugin, I managed to introduce some changes which, without my knowledge, borked the normal operation of the comments form here. Meaning that if you submitted a comment any time in the last several days, and it hasn’t appeared on the page yet, it’s not because it’s waiting in the moderation queue; it’s because (argh) WordPress lost it, due to said borking. In particular, if you tried to comment on:

• GT 2008-02-13: Liberty, Equality, Solidarity: Toward a Dialectical Anarchism
• GT 2008-02-14: Refuge of Oppression #5: Twofer Tuesday edition
• GT 2008-02-15: Tyranny means never having to say you’re sorry
• GT 2008-02-16: Conservatives do it with class. (Part 2)
• GT 2008-02-16: In two words or fewer: Stop Snitchin’ edition
• GT 2008-02-17: In Ten Words or Fewer: brass tacks edition
• GT 2008-02-18: Cops are here to protect you.
• GT 2008-02-18: Working Within The System comix
• GT 2008-02-19: Death by Homeland Security
• GT 2008-02-20: Over My Shoulder #41: Paul Buhle on establishmentarian unionism, the decline of labor organizing, and the rise of Labor PAC. From Taking Care of Business: Samuel Gompers, George Meany, Lane Kirkland, and the Tragedy of American Labor.
• GT 2008-02-21: Mississippi Corrections

… and your comment hasn’t appeared yet on the site, then it’s because I never got your comment. If you can say again what you had to say then, I’d be very glad to hear it; if not, I understand, and I really apologize for the trouble for this bout of blockheadedness on my part.

I wish that I had a more auspicious occasion for unveiling the new feature on the blog.