Building the Commons as an Antidote to the Predatory Market Economy

These are times of radical change. We are in the midst of an evolution. As David Bollier writes, “We are poised between an old world that no longer works and a new one struggling to be born. Surrounded by centralized hierarchies on the one hand and predatory markets on the other, people around the world are searching for alternatives.”

The old world is one of concentrated economic power that hoards wealth; that creates corrupted and hierarchical governance to serve and further concentrate wealth through exploitation of people and the planet. People are experiencing the ravages of this global neoliberal economy in which the market reigns supreme and everything is a profit center, no matter the human and environmental costs.

We are at a crossroads in the global economic order. If not stopped, the two massive “trade” agreements under negotiation at present, the Trans-Pacific Partnership (TPP) and the Trans-Atlantic Trade and Investment Partnership (known as TAFTA), will cement this globalized neoliberal market economy through greater deregulation, profit protection and an extra-judicial trade tribunal in which corporations can sue sovereign nations if their laws interfere with profits.

There is another way. We’ve reached a tipping point in awareness of the effects of the current global economy that has erupted in a worldwide revolt as we can see in the Occupy, Arab Spring, Idle No More and Indignado movements. People are searching for alternative ways of structuring the economy and society that are empowering and more just and sustainable. Part of this work includes understanding and building the “commons,” which is the opposite of the predatory market economy.

As we will describe below, concentrated wealth is derived by taking from the commons for personal gain in an undemocratic way. We can reverse the current trend toward privatization and wealth inequality by claiming the commons and using it for mutual prosperity. The commons cannot exist without a participatory governance structure. Therefore, building the commons is a fundamental step toward real democracy.

Bollier, author of The Wealth of the Commons, makes the case that there is “enormous potential of the commons in conceptualizing and building a better future.” Understanding the commons gives us a vocabulary, vision and practical opportunities to create a new world in which governance builds from the bottom up and connects us from the local to the global level.

What is the commons?

What is considered a commons is defined by a particular community and includes more than the physical spaces we usually think of. A commons is something that is a community’s entitlement and for which the community shares responsibility to protect, sustain and grow. A commons cannot exist without human involvement through a participatory governance structure.

As David Bollier says, “a commons arises whenever a community wants to manage a resource in a collective manner, with a special regard for equitable access, use and sustainability. It is a social form that has long lived in the shadows, but which is now on the rise.”

Roman law actually declared certain things intrinsically common property, notably air, wildlife and navigable waters. The term “commons” dates back to medieval England, where it referred to certain rights that everyone had, even on land owned by the aristocracy, for example, to graze their animals.

When we declare something a commons, it gives us a new understanding and new vocabulary to reclaim it. For example, the initial view of the broadcast media was that they aired on “public airwaves.” The airwaves were something we all shared and were a resource for the public good. However, public airwaves were gradually transformed into “commercial airwaves,” in which content is controlled by advertisers and wealth owners. They do not have a public responsibility to share information but are viewed as a private opportunity to build wealth. When we see the airwaves as a public commons, they can be transformed to serve the public, e.g. requiring free air time for candidates to reduce the influence of money in elections.

In this era of transformation we are seeing the concept of the commons rising up, often without much attention by the media or government. People are developing tools to create commons. One of the most underappreciated parts of the commons is our collective knowledge. People are building on this collective knowledge with new tools like open-source software, which can be shared without the monopolistic practices of corporations such as Microsoft, or the sharing of information through Creative Commons copyrights rather than restrictive for-profit copyrights. People also are working to build information through wikis that allow crowd sourcing of information to create a shared, deep pool of knowledge. Indeed, the Internet has created a momentum for commons-culture because it has made incredible amounts of information widely available for free.

Political economist GarAlperovitz writes about the commons in Unjust Deserts: How the Rich Are Taking Our Common Inheritance and Why We Should Take it Back. He describes how “Every new breakthrough starts from a plateau of knowledge created by others and preserved and passed on by society.” The wealthiest people in the world today would not have attained their wealth without the “plateau” of knowledge created by the many generations that came before them. Often this knowledge is paid for out of our commonwealth, i.e. taxes paid by everyone to provide funds for research like pharmaceuticals or to create the Internet; or by using public land to provide the space to build railroads and roads or to acquire minerals and other natural resources.

Alperovitz points out that Bill Gates, who made his fortune from computers, software and the Internet, could not have been a multibillionaire if it had not been for the commonwealth that created all of the infrastructure and knowledge on which he built his fortune. Or, as Warren Buffett said, “Take me as an example. I happen to have a talent for allocating capital. But my ability to use that talent is completely dependent on the society I was born into. If I’d been born into a tribe of hunters, this talent of mine would be pretty worthless. I can’t run very fast. I’m not particularly strong. I’d probably end up as some wild animal’s dinner.”

These are realities for everyone who has gained tremendous wealth, because as Alperovitz points out, “Wealth is built on inherited knowledge, a generous gift from the past.” In other words, it is the commons – our common knowledge, infrastructure and technology – that allows people to advance and create individual wealth. Once this is understood, it allows for new thinking about equitable allocation of wealth and replenishment of our commons through progressive taxation and provides a moral foundation for shared prosperity. It also raises questions and moral doubts about the siphoning off of the commons, depleting it rather than enriching it for all and sustaining it for future generations.

There can be a very positive role for government in legally recognizing and structuring the commons to share the wealth that comes from it. One example is the Alaska Permanent Fund, which was created to more equitably share the wealth created from public lands. When oil is taken from public lands, a percentage of the profit goes into the Alaska Permanent Fund, which manages the money and then distributes a yearly check to every person in Alaska from birth to death. These checks, usually range from $1,000 to $2,000 per person and can provide a family with income of $5,000 to $10,000 every year.

What would have happened if the investment we all made by providing lands for railroads and highways or inventing the Internet or pharmaceuticals or investing in a new clean energy economy had been put into a national permanent trust and distributed to all Americans each year rather than being given to corporations to create profits? The United States would have a guaranteed national income for everyone from our shared commonwealth and would have eliminated poverty. With the transformation to a new energy economy, the need to upgrade transit and rebuild infrastructure, we have another opportunity to share wealth by treating taxpayer investment as a commonwealth in which we all should share.

Tension between the market and the commons

There is a conflict between market culture and the commons. Market culture believes in privatizing as much as possible and taking from the commons – whether it is research, access to cheap loans, tax breaks, public land, infrastructure or resources –to make a profit for their owners and investors. The market takes from the commons for free, and whatever liabilities it incurs or whatever it cannot make a profit from, it dumps back into the commons. Some call it privatizing the profits and socializing the risks.

People who believe in the commons recognize the importance of building communities that we all benefit from – protecting, sustaining and expanding the commons. They recognize that the commons should be used in an equitable way so everyone benefits.

Market culture has colluded with government, sometimes so closely that big business and government seem like a hand in a glove. They work together as partners to expand the market’s power over all aspects of our lives. As David Bollier says, “The state provides a useful fig leaf of legitimacy and due process for the market’s agenda, but there is little doubt that private capital has overwhelmed democratic, non-market interests except at the margins.”

Often the result seems like legalizing what should be illegal or unethical practices, whether it is massive campaign donations to dominate elections with money, or exempting the oil and gas industry from clean air and water laws so they are not responsible for pollution, or the leasing of public lands at very low rates with no royalty payments for the profits from public lands.

The pressure to privatize the commons is immense. Today, we are seeing efforts to privatize even the most basic of entities, e.g. water. Aquifers are being drained by private companies such as Nestle to sell as bottled water or by farmers in drought-stricken areas to sell to oil and gas companies for fracking. The two trade agreements under negotiation, the TPP and TAFTA, are trying to put in place laws that would severely weaken public enterprises and open the floodgates to privatization.

People who believe in the commons seek to get outside of the narrow political discourse authorized by the corporate political duopoly, which does not allow us to systematically examine the abuses of the market and the corruption of the two-party, mirage democracy. Commons advocates seek to open the possibilities of political movements developing around the commons, creating new governance structures and challenging market dominance.

This will require a culture shift. Economics and political science students are taught from the beginning that treating entities as commons will lead to certain ruin. Advocates of markets have taken a 1968 essay by Garret Hardin, “The Tragedy of the Commons,” and used it to make a false case for market ideology. In the essay, Hardin argues that when something is treated as a commons, it will be overused and destroyed by personal interests. He describes a pasture on common land where all those who graze their animals on the land seek individual profit without regard for others. They add more and more animals to make a larger profit and ultimately destroy the land held in common for grazing. The metaphor illustrates the argument that free access and unrestricted demand for a finite resource ultimately reduce the resource to depletion.

In recent years, the case for “The Tragedy” has been rebutted by Nobel Prize-winning economist Elinor Ostrum, who wrote “Beyond the Tragedy of the Commons.” Ostrum examined how commons were actually used. She found that the so-called tragedy of the commons was not prevalent, nor was it difficult to solve. Indeed, people from local communities routinely develop controls over the commons to protect it from “the tragedy.” In 1990, she wrote, “Governing the Commons,” which examined the governance of natural resources. She found that neither state control nor privatization of resources was the appropriate answer and that commons are sometimes governed by voluntary organizations. She developed eight “design principles” of stable local management of commons. These are:

1. Clearly defined boundaries.

2. Rules regarding the appropriation and provision of common resources that are adapted to local conditions.

3. Collective-choice arrangements that allow most resource appropriators to participate in the decision-making process.

4. Effective monitoring by those who are part of or accountable to the appropriators.

5. A scale of graduated sanctions for those who violate community rules.

6. Mechanisms of conflict resolution that are cheap and of easy access.

7. Self-determination of the community recognized by higher-level authorities.

8. In the case of larger commons resources, organization in the form of multiple layers situated inside one another, like Russian nesting dolls.

These have been refined to include additional principles, e.g. effective communication, internal trust and reciprocity, and making connections between the various parts of the resource system as a whole.

Evolving governance of the commons

These principles are applied in the real world to govern the commons. In fact, Bollier argues that using these principles of the commons is the natural default action of people, pointing out that 2 billion people depend on commons of forest, fisheries, water and wild game. There are an enormous number of functional, successful commons around the world that mainstream economics does not acknowledge. These commons cultures often develop organically and are based in a particular community where they can adapt as conditions change. Compare this set-up to trade agreements such as the TPP and TAFTA, which are not connected to local communities but come from hierarchical structures dictating from above.

When we look at the commons, we begin to understand that there is a long history of communal work and of people building together to benefit everyone, not just a few. In some societies, this was manifested through barn-raisings, and in others it was creating a cooperative market or an educational collective.

Public utilities that provide electricity are a commons of energy. FDR created public utilities as part of the New Deal to supply electricity to rural areas that did not have any. A similar battle today is whether or not cities will provide public access to the Internet for everyone.

To develop governance for the commons, people first need to be able to conceptualize it and understand the ways we can legally recognize the commons. One important concept is that responsibility for managing a commons should go to the lowest practical level, so governance is as close to the people using the commons as possible, thereby allowing local cultures and traditions to be incorporated into it. This is a change from traditional hierarchical political institutions to a new bottom-up, networked-based culture of the commons.

Interesting experiments in governance are happening all over the world. There is a huge international interest in developing the commons. One idea from Italy is to take the private-public partnership model that benefits private businesses with tax dollars and apply it to the commons, creating public-commons partnerships so that the commons can be used and developed for the public benefit. People are also chartering a commons just as one would charter a corporation. This provides a legal structure and ensures the commons is used for public benefit.

In many respects, protecting, sustaining and developing the commons brings us back full circle, as Jonathan Rowe, author of Our Common Wealth: The Hidden Economy That Makes Everything Else Work, wrote:

“Life was once rich in occasions for spontaneous interaction. People shopped on Main Streets, visited on front porches, attended political events in public venues. Abraham Lincoln and Stephen Douglas had their famous debates in county fairgrounds and town squares all over Illinois, and farmers and townspeople sat for hours in the heat and dust to hear.”

But the commons is not looking back to an idealized past; it is looking forward to a vision of an economy of new values, people building community and working together to solve common problems; to a time when all people have access to the information shared on the Internet, and are assured of the most basic of our commons – clean air and clean water. Johnathan Rowe, who also co-founded the website On The Commons, wrote:

“The commons is real, huge, and invaluable, and it belongs to all of us. It’s also being destroyed – not by itself, but by too much privatization. The possibility part is, We have the capacity to save the commons, though time is short. The moral part is, It’s our right and duty to save the commons.”

We are at an important juncture. The TPP and TAFTA are being negotiated in secret to complete the World Trade Organization agenda of nearly complete privatization. If we believe in a more just, sustainable and democratic world, a world based on the common good, then we must mobilize to stop them. In saving the commons, we are actually building the foundation for the new economy. We are building a world in which people work together to solve common problems and create a more equitable economy and better lives for all of us.

More reading:

Lifting the Veil of Mirage Democracy in the United States

Cooperatives and Community Work Are Part of American DNA

Trans-Pacific Partnership Will Undermine Democracy, Empower Transnational Corporations

Remaking the Federal Reserve, Building Public Banks and Opting Out of Wall Street

You can hear our interview Taking Back the Commons with David Bollier on Clearing the FOG here.