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Capitalism 3.0 Capitalism 3.0 A GUIDE TO RECLAIMING THE COMMONS PETER BARNES Copyright © 2006 by Peter Barnes All commercial rights reserved. No part of this publication may be reproduced, distributed, or transmitted for commercial purposes without the prior written permission of the publisher. Brief quotations for use in reviews may be cited without permission. In addition, an electronic down- loadable version is available free of charge at http://www.onthecommons.org, and may be distrib- uted for noncommercial purposes without permission, provided the work is attributed to the author and no derivative works are made from it. This electronic version is licensed under the Creative Commons Attribution-NonCommercial-NoDerivs 2.5 License (some restrictions apply). To view a copy of this license, visit http://creativecommons.or/licenses/by-nc-nd/2.5/. For permis- sion requests, write to the publisher, addressed “Attention: Permissions Coordinator,” at the address below. Berrett-Koehler Publishers, Inc. 235 Montgomery Street, Suite 650 San Francisco, CA 94104-2916 Tel: (415) 288-0260 Fax: (415) 362-2512 www.bkconnection.com Ordering Information Quantity sales. Special discounts are available on quantity purchases by nonprofit organizations, corporations, associations, and others. For details, contact the “Special Sales Department” at the Berrett-Koehler address above. Individual sales. Berrett-Koehler publications are available through most bookstores. They can also be ordered directly from Berrett-Koehler: Tel: (800) 929-2929; Fax: (802) 864-7626; www.bkconnection.com Orders for college textbook/course adoption use. Please contact Berrett-Koehler: Tel: (800) 929-2929; Fax: (802) 864-7626. Orders by U.S. trade bookstores and wholesalers. Please contact Publishers Group West, 1700 Fourth Street, Berkeley, CA 94710. Tel: (510) 528-1444; Fax (510) 528-3444. Berrett-Koehler and the BK logo are registered trademarks of Berrett-Koehler Publishers, Inc. Printed in the United States of America Berrett-Koehler books are printed on long-lasting acid-free paper. When it is available, we choose paper that has been manufactured by environmentally responsible processes. These may include using trees grown in sustainable forests, incorporating recycled paper, minimizing chlorine in bleaching, or recycling the energy produced at the paper mill. Library of Congress Cataloging-in-Publication Data Barnes, Peter. Capitalism 3.0 : a guide to reclaiming the commons / by Peter Barnes. p. cm. Includes bibliographical references and index. ISBN-10: 1-57675-361-1; ISBN-13: 978-1-57675-361-3 1. Commons—United States. 2. Privatization—United States. 3. Capitalization—United States. I. Title. HD1289.U6B37 2006 333.2—dc22 2006013322 First Edition 11 10 09 08 07 06 10 9 8 7 6 5 4 3 2 1 Interior Design: Laura Lind Design Proofreader: Henrietta Bensussen Copy Editor: Sandra Beris Indexer: Medea Minnich Production: Linda Jupiter, Jupiter Production To Cornelia and Smokey For his labor being the unquestionable property of the laborer, no man but he can have a right to what that is once joined to, at least where there is enough, and as good, left in common for others. —John Locke (1690) Contents Preface ix Acknowledgments xvii PART 1: THE PROBLEM Chapter 1 Time to Upgrade 3 Chapter 2 A Short History of Capitalism 15 Chapter 3 The Limits of Government 33 Chapter 4 The Limits of Privatization 49 PART 2: A SOLUTION Chapter 5 Reinventing the Commons 65 Chapter 6 Trusteeship of Creation 79 Chapter 7 Universal Birthrights 101 Chapter 8 Sharing Culture 117 PART 3: MAKING IT HAPPEN Chapter 9 Building the Commons Sector 135 Chapter 10 What You Can Do 155 Appendix 167 Notes 169 Web Resource Guide 177 Bibliography 179 Index 185 About the Author 194 Preface ’m a businessman. I believe society should reward successful Iinitiative with profit. At the same time, I know that profit-seeking activities have unhealthy side effects. They cause pollution, waste, inequality, anxiety, and no small amount of confusion about the purpose of life. I’m also a liberal, in the sense that I’m not averse to a role for government in society. Yet history has convinced me that representa- tive government can’t adequately protect the interests of ordinary citizens. Even less can it protect the interests of future generations, ecosystems, and nonhuman species. The reason is that most—though not all—of the time, government puts the interests of private corpo- rations first. This is a systemic problem of a capitalist democracy, not just a matter of electing new leaders. If you identify with the preceding sentiments, then you might be confused and demoralized, as I have been lately. If capitalism as we know it is deeply flawed, and government is no savior, where lies hope? This strikes me as one of the great dilemmas of our time. For years the Right has been saying—nay, shouting—that government is flawed and that only privatization, deregulation, and tax cuts can save us. For just as long, the Left has been insisting that markets are flawed and that only government can save us. The trouble is that both sides are half-right and half-wrong. They’re both right that mar- kets and state are flawed, and both wrong that salvation lies in either sphere. But if that’s the case, what are we to do? Is there, perhaps, a missing set of institutions that can help us? I began pondering this dilemma about ten years ago after retir- ing from Working Assets, a business I cofounded in 1982. (Working Assets offers telephone and credit card services which automatically | ix | x | CAPITALISM 3.0 donate to nonprofit groups working for a better world.) My initial ruminations focused on climate change caused by human emissions of heat-trapping gases. Some analysts saw this as a “tragedy of the commons,” a concept popularized forty years ago by biologist Garrett Hardin. According to Hardin, people will always overuse a commons because it’s in their self-interest to do so. I saw the prob- lem instead as a pair of tragedies: first a tragedy of the market, which has no way of curbing its own excesses, and second a tragedy of gov- ernment, which fails to protect the atmosphere because polluting corporations are powerful and future generations don’t vote. This way of viewing the situation led to a hypothesis: if the commons is a victim of market and government failures, rather than the cause of its own destruction, the remedy might lie in strengthen- ing the commons. But how might that be done? According to pre- vailing wisdom, commons are inherently difficult to manage because no one effectively owns them. If Waste Management Inc. owned the atmosphere, it would charge dumpers a fee, just as it does for terres- trial landfills. But since no one has title to the atmosphere, dumping proceeds without limit or cost. There’s a reason, of course, why no one has title to the atmos- phere. For as long as anyone can remember there’s been more than enough air to go around, and thus no point in owning any of it. But nowadays, things are different. Our spacious skies aren’t empty any- more. We’ve filled them with invisible gases that are altering the cli- mate patterns to which we and other species have adapted. In this new context, the atmosphere is a scarce resource, and having some- one own it might not be a bad idea. But who should own the sky? That question became a kind of Zen koan for me, a seemingly innocent query that, on reflection, opened many unexpected doors. I pondered the possibility of start- Preface | xi ing a planet-saving, for-profit, sky-owning business; after all, I’d done well by doing good before. When that didn’t seem right, I wondered what would happen if we, as a society, created a trust to manage the atmosphere on behalf of future generations, with present-day citizens as secondary beneficiaries. Such a trust would do exactly what Waste Management Inc. would do if it owned the sky: charge dumpers for filling its dwindling storage space. Pollution would cost more and there’d be steadily less of it. All this would happen, after the initial deeding of rights to the trust, without government intervention. But if this trust—not Waste Management Inc. or some other corpora- tion—owned the sky, there’d be a wonderful bonus: every American would get a yearly dividend check. This thought experiment turned into a proposal known as the sky trust and has made some political headway. It also served as the epicenter of my thinking about the commons, which led to this book. A Personal Exploration The exploring that lies behind this book began long before I started Working Assets. As a boy, I helped my father crunch numbers for several books he wrote about the stock market. Later, as a journalist for Newsweek and The New Republic, I wrote dozens of articles on economic issues. But my real economic education began in my thir- ties, when, after a midlife crisis, I abandoned journalism and plunged headfirst into capitalism. My motives at the time were mixed. On one level, I was tired of writing, needed money, and didn’t like working for other people. On another level, I wanted to see if various ideas I’d acquired made sense. I’d been much affected by the writings of British economist E. F. Schumacher. In his 1973 book Small Is Beautiful, Schumacher argued that capitalism is dangerously out of sync with both nature xii | CAPITALISM 3.0 and the human psyche. As an alternative, he envisioned an econ- omy of small-scale enterprises, often employee-owned, using clean technologies.
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