Saturday, August 15, 2009

Douglas Rushkoff on Common Threads


On August 14, 2009, author Douglas Rushkoff called in to our Common Threads show with Diamond Dave Whitaker. We talked about the sad state of affairs between society and economy; the fact that humans were not destined to be this way; and the idea of alternate economies and currencies and how to set these up in actuality.

The full podcast for 8/14/2009 (2 hours) - Douglas calls in around the 1 hour mark. (shorter edit coming soon)

An 8-minute "trailer" for his book, Life, Inc:

Life Inc. The Movie from Douglas Rushkoff on Vimeo.



You can grab more movie clips by and about Rushkoff and regarding his book from his own website on this page.

Rushkoff has expressed his desire for people to get out of the rut of talking about solving problems and get into actually DOING -- creating the scenarios in which people can get to the levels of community self-sufficiency that will begin to resolve the dangerous corporate dependencies in which American culture (and beyond) has become entangled.

We brought local organizers into this show involved with NoBAWC.org and Just Alternative Economics to discuss their strategies and talk about the successes they've had in growing community-based micro economies.

6 comments:

chuckmoulton on August 17, 2009 at 4:13 AM said...

I enjoyed your interview. I was surprised by how much I agreed with Rushkoff... I assumed ex ante I would totally disagree with him.

He's right on the money about the history of corporations: they were setup to retain monarchy power and stiffle the upcoming merchant class. This was done through the granting of monopolies, such as with the British East India Company. The Revolutionary War in America wasn't just a tax revolt... it was fear of the total corporate subjegation in the American colonies like that seen in India.

However, corporations don't have to be like that. The corporation with its limited liability and ease of raising capital is severable in concept from government monopolies. When states one by one adopted general incorporation laws which allowed corporations to be formed without a special vote of the legislature each time, the monopoly charters became things of the past. The last vestiges of such abominations is the so-called natural monopolies: public utilities, telephone, cable, etc. Well, that and patents/trademarks/copyrights.

Similarly, Rushkoff and you attacked the obsession with working hard and saving money, but I think those concerns are overblown. I agree many people live in the future rather than the present (myself included) and would be better off enjoying liesure time when they're young enough to enjoy it rather than when they're old and decrepit.

However, intertemporal consumption patterns boil down to another choice people can utilize to better their lives. Removing that choice would not make people better off, it would make them worse off. If someone wants to work intensively to reward themselves with a longer future vacation/retirement or more material goods rather than having a less demanding job, that is a reasonable decision for them to make to maximize their personal utility.

Money is a tool for translating labor into subsistence food, shelter, etc. and entertainment. It is not an end in itself, it is a means to an end. Money is a store of value, a medium of exchange, unit of account, etc. Eliminating money would make everyone worse off because barter is far less efficient. With barter you need to find someone who has what you want and will take what you have... it can be hard to find someone who has oranges and wants toilet paper, for example. Money reduces transactions costs by facilitating exchange.

Rushkoff had many good points about the history of money and central banks mucking things up. But the solution isn't defaulting to barter and communes... the answer is a sound hard currency or free banking (allowing anyone to print his own currency and anyone to accept or reject it). There's always a place for barter, yet the huge superiority of money is evident in that in every country that has dealt with hyperinflation (the worst case scenario of money), people/merchants still prefer money to barter.

You made some excellent points about measurement problems with GDP. People put way too much stock in that arbitrary number. GDP doesn't include the black market (drugs, prostitution, pornography), it doesn't include non-monetary activity (e.g., a man who marries his maid and converts her into a housewife doing the same thing for free/barter hurts GDP), inconsistently measures output (counts final goods and doesn't count intermediate goods... but which is which? e.g., gas is final good for recreation, intermediate good driving to work), non-market prices distort GDP (price controls, government output measured at cost), doesn't count liesure, marginal utility is not the same as total utility (e.g., free goods). I could go on and on. All that said though, it's better to try to measure something and potentially be off by two standard deviations than not to try at all. The trick is not obsessing over the number and recognizing its limitations.

Anyway, those were a few of the things that came to mind as I listened to the interview a few days ago.

It's too bad you didn't have more time with him. He'd make a great guest on a full hour long show.

nthmost on August 17, 2009 at 2:18 PM said...

I really don't understand why you and others construct a false dichotomy when it comes to the cultural approach to "working hard and saving money" (which is not really what I felt we were talking about at all actually, but whatever).

Quoting you (Chuck):

"However, intertemporal consumption patterns boil down to another choice people can utilize to better their lives. Removing that choice would not make people better off, it would make them worse off. If someone wants to work intensively to reward themselves with a longer future vacation/retirement or more material goods rather than having a less demanding job, that is a reasonable decision for them to make to maximize their personal utility."

Who is suggesting legislation?

The idea is not that we should PREVENT people from working hard if they want to. It's to raise consciousness in people that "working harder" systematically makes it so that you HAVE to work harder. People need to give up the belief that giving up more of their time to make up for monetary deficits will result in them getting ahead.

No one ever suggested (not Coffeen either -- I've heard that objection raised to his assertion that 24 hours should be the workweek) that we should legislate against working longer. That's jumping to conclusions and certainly would be counterproductive to the kind of freedom-based, leisure-focused economic culture we'd ultimately like to have emerge.

Seriously, I don't get it. False dichotomy to the max, dude.

That's the same kind of strident belief matrix upon which the current system of economic assumptions are place which has proved to completely inaccurately model human behavior -- the behaviors that are used to try to predict investments which have, to the present day, been the tail that wags the dog of our macro-economy.

nthmost on August 17, 2009 at 2:20 PM said...

"Rushkoff had many good points about the history of money and central banks mucking things up. But the solution isn't defaulting to barter and communes... the answer is a sound hard currency or free banking (allowing anyone to print his own currency and anyone to accept or reject it). There's always a place for barter, yet the huge superiority of money is evident in that in every country that has dealt with hyperinflation (the worst case scenario of money), people/merchants still prefer money to barter."

Rushkoff is much more for a free market of currencies than anything else.

It was frustrating to only have 15 minutes with him, moderated by Diamond Dave. :)

You should read his book, you'd dig it.

chuckmoulton on August 17, 2009 at 5:26 PM said...

Naomi Most wrote:
"The idea is not that we should PREVENT people from working hard if they want to. It's to raise consciousness in people that 'working harder' systematically makes it so that you HAVE to work harder."

I'm glad to hear it's about education rather than legislation. I didn't pick up on that before.

It's true that working harder makes it so that you have to work harder. There are several reasons for that. First, if government taxes you on monetary income (vs. non-monetary activities), working hard is disincentivized over liesure. Also progressive taxation disincentivizes working intensively in one year and vacationing in another year vs. working at a medium intensity for 2 years. Second, there will always be overhead for working (commute time, gas, etc.) that is not available for merely trading work for liesure between two time periods. Third, many people work harder with the intent of smoothing out consumption by saving for the future, but then end up spending more in the current time period rather than saving it and get used to a luxurious lifestyle (instead of the frugal, moderate lifestyle they had planned for), which means they can't afford the vacation/retirement they planned (as they step up the sort of lifestyle they demand when in vacation/retirement). (e.g., many law school students wanted to go into public interest law, but worked at law firms to pay off student loans, then got used to the lifestyle and couldn't bear to earn a public interest salary.) Fourth, people saddle themselves with debts while working (e.g., a mortgage), then become tied down servicing that debt which removes career/lifestyle choices. Fifth, a lot of hard working people are sucked into the materialistic mindset that the way to "win" is to accumulate as much money or stuff as possible, which is perpetuated by the workplace and the media. Sixth, working intensively creates problems which are seen as necessitating solutions that cost money and thus demand more work, such as stress, injuries, or simply unhealthy work habbits (like sitting in one place 8 hours a day).

Are there more reasons I haven't considered? I believe the reasons I've enumerated are surmountable through judicious choice of career, a saner government, and better financial decisions. Thus although working harder is usually associated with these bad patterns, that doesn't have to be the case.

But yes, I agree that people need more education to encourage self-evaluation about what really makes them happy with less conformism into the standard consumer/corporate culture.

Also note that capital investment always involves additional work. Robinson Crusoe can collect berries, or he can forgo berries to make a fishing net. The fishing net yeilds him no direct benefit, but it will indirectly help him catch fish in the future. Similarly, intertemporal consumption patterns (saving and dissaving) allows for investment opportunities generating interest / dividends / capital gain, so the additional work is not for naught.

Btw, I forgot to mention some other benefits of intertemporal consumption patterns and a money economy: gifting, charity, and intergenerational saving. The fact that I can labor now not just to increase my future utility, but also to increase your future utility if I decide to give you something or my grandkid's future utility by leaving him the fruits of my labor in my will is pretty extraordinary when you think about it. Money is a store of value, while many goods are perishable or have huge depreciation (granted, inflation is a form of depreciation for money). Storing value is much more difficult under barter.

Oh, I also should clarify that I'm not going only from your interview. I saw Rushkoff discuss Life, Inc. on The Colbert Report too.

chuckmoulton on August 17, 2009 at 5:33 PM said...

This is a meta comment:

It's pretty frustrating that this blog comment form on Subversive Science doesn't allow copy & paste under Firefox. I should probably use IE, but I hate IE even more.

I realized that IE would have been preferable now after doubling the character limit and being forced to delete things with no copy & paste to save my efforts.

Oh well, live and learn. The really ironic thing is copy & paste now seems to work. It only works AFTER a comment is posted in my experience.

Now I have 18 Photoshopped screen captures to retype. I need an intern.

chuckmoulton on August 17, 2009 at 5:46 PM said...

(Okay, only 6 screen captures were the deleted part... not that bad.)

Naomi Most wrote:
"Rushkoff is much more for a free market of currencies than anything else."

Interesting. That's good to hear. He was sending mixed messages by coupling railing on central banks with talking up communes and barter. I'm for free banking / free market currencies btw -- and that's what I'll be writing my dissertation on. I'm very intrigued by the repeated Common Threads guest that talks about her commune making its own currency. It's too bad the government crushes free market currencies -- like the Liberty Dollar, whose founder is currently being prosecuted.

Naomi Most wrote:
"It was frustrating to only have 15 minutes with him, moderated by Diamond Dave. :)"

Diamond Dave clearly approached that interview from a much different angle. It's really weird listening to that show... being around Diamond Dave you sound like a total socialist, but your tweets and blog entries sound mostly free market (except for healthcare).

I don't think it's the Ed McMahon yes man sidekick phenomenon or conformity of beliefs with current peers/audience. If anything I'd posit you shift perspectives situationally. (I think there is a fundamental distinction between exploring problems/issues from different perspectives and vacillating/equivocating on beliefs.)

But maybe it's just variance in topic selection. Or perhaps I'm misinterpreting your tweets / blog entries, imputing my own views on them to cast them in the most free market light.

Naomi Most wrote:
"You should read his book, you'll dig it."

I'll check it out!

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