A BLOG of PHILOSOPHICAL REFLECTIONS & SPECULATIONS

The Peer Production Illusion

Part II: The Neoliberal Ideology of P2P

Published on Tuesday December 20th, 2011

In some ways, the rise of the open source movement runs counter to the neoliberal ideology that has prevailed since the late 1970s. Neoliberal policies rolled back the welfare state, disciplined labor and eliminated government-supported utilities and services, replacing them with for-profit corporations, turning public goods into commodities. But in the technology industry, the movement from private ownership to open source projects engaged in social production seems to point in the opposite direction, towards de-privatization and de-commodification.

This may be cause for optimism for some anti-capitalist activists, but in Part I of this blog post, I show how de-privatization is still profitable and compatible with proprietary software – it probably wouldn’t have occurred if it wasn’t. A similar point can be made of other types of peer production in general. Wikipedia is a non-profit charity and doesn’t earn revenue directly from the work of it’s editors, but because most people search Wikipedia with Google, it generates a profit for Google. As the 6th most popular site on the Internet, this is probably somewhat significant.

But for the optimists, this is not enough. All I have shown is that peer production has not overthrown capitalism yet. The establishment of gift economies, even if they grow profits right now, might contain the seeds of eliminating capitalist production altogether. I’m going to call this the Beachhead Hypothesis: in the vast territory controlled by capitalism, P2P creates autonomous spaces free from exploitative wage labor that can be expanded to encroach further on enemy territory.

I disagree with this hypothesis because I don’t think we took this territory, I think it was created by capitalism. This possibility is often ignored because of what seems to me to be a too totalizing view of capitalism, a view which is sometimes read in Marx. From The Communist Manifesto:

The bourgeoisie, wherever it has got the upper hand, has put an end to all feudal, patriarchal, idyllic relations. It has pitilessly torn asunder the motley feudal ties that bound man to his “natural superiors”, and has left no other nexus between man and man than naked self-interest, than callous “cash payment”. It has drowned out the most heavenly ecstasies of religious fervour, of chivalrous enthusiasm, of philistine sentimentalism, in the icy water of egotistical calculation. It has resolved personal worth into exchange value, and in place of the numberless indefeasible chartered freedoms, has set up that single, unconscionable freedom - Free Trade.


If the expansion of capitalism involves the replacement of every relation with self-interest, then the beachhead hypothesis makes sense. But despite neoliberal ideology, this does not seem to be the case, and this can be illustrated by looking at a difference between life in France and in the US.

If you live in France and you want to start a local soccer club, you go to the local government and ask for funding. If they agree, they will subsidize uniforms and equipment and this is paid for out of tax revenue. In the US and other Anglo-Saxon countries, this is practically unthinkable – maybe there would be some very small grants available to help underprivileged children, but to propose that the state should support the recreation of adults would generate a huge amount of outrage, especially from conservatives. This is because in the US, this is a private matter and it is considered inappropriate for the state to be involved in. The expectation is that if you need funding for a sports club, you will get sponsorship from local businesses in exchange for advertising, there may be charitable or civic organizations that will donate, you might engage in various fundraising activities by promoting your club as beneficial to the local community, and of course collect dues from members.

This example demonstrates a more general difference between the countries: in France, everything is supported by the state – education, health care, but even food, religion, the arts, community centers, and sports clubs. In Anglo Saxon countries, these are often provided by civil society or what is sometimes called the Third Sector, neither public government, nor private corporation. This includes voluntary associations like Lions Clubs, charities and non-profits, volunteering and local organizations for many of these public goods. We can see the effects of this tradition in the World Giving Index which ranks countries by the amount of charitable giving and volunteering per capita. The six Anglo-Saxon countries Australia, New Zealand, Canada, Ireland, USA, and the UK all rank in the top 10, while France is 91st.

It’s part of the American can-do spirit that we don’t rely on the government. We get out there, get involved, contribute to our community and help each other out. But there is actually something quite sinister about this. What it means is that the state will withdraw and only provide the absolute bare minimum that it can get away with so as not to disturb the smooth functioning of capitalism. If the people need more than that, they can form voluntary associations to find whatever they can spare amongst themselves. The consequence of that is that French kids enjoy well-funded schools with all the proper materials and learn music and art, while American kids, if they’re middle class, are washing cars on the weekends desperately trying to fund their own education.

Perversely, Americans are proud of this. The progressive left is especially fond of volunteerism, apparently under the belief that an ethic of individual, voluntary cooperation and assistance can be expanded to support a social democratic political program. But it is no coincidence that Anglo-Saxon countries with a strong civic culture – which peer-to-peer gift economies should fall under – are the same countries that allow unfettered capitalism to the maximum degree possible. These two facts are intimately related. The expansion of the third sector of civil society is associated with neoliberal restructuring of Western welfare states, as non-profits funded by donations and volunteer labor begin to take on a greater role in the provision of social services.

This is because Marx got it wrong: in order for us to have free market capitalism, the non-private, non-state sphere of charities and civil society are expanded to pick up the slack. Far from undermining every social relation and replacing them with the profit motive, civic duty, generosity and contributing to your community become the ethical ideals.


The de-commodification of intellectual labor that we see with the rise of peer production does not represent a countervailing trend to the neoliberalism, it is very much a part of it. Neoliberalism privatizes profits and socializes costs, and peer production is an even more radical implementation of that idea, taking it one step further. Normally, socializing of costs means government pays for something – for example, bailing out failed banks. Since this money comes out of a tax system that is at least moderately progressive, we can regard it as an attempt by the rich to recover wealth lost to taxation.

As a method for socializing costs on to civil society, peer production is far more radical, a way of appropriating from the people what little remaining resources they have after being exploited in the workplace. It requires a transformation in the ideology of civil society, which is normally used as form welfare provision of the people, particularly the poor, to justify lowering taxes and shrinking the size of the state. P2P ideology takes a radical step by not just being content to relieve the rich of their tax burden, but squeezing civil society even more by turning into a source of corporate profits as free labor.

If the empirical evidence shows that a large role for civil society is associated with greater freedoms for capitalism, the Beachhead Hypothesis is not only false, it points in the opposite direction, to a further rolling back of the social democratic welfare state and intensification of neoliberal exploitation. In Commons-based Peer Production and Virtue Yochai Benkler and Helen Nissenbaum suggest that the use of peer production systems may encourage pro-social and public-spirited virtues – the same virtues that motivate charitable volunteering and giving – but express this tentatively because they can’t find a causal mechanism. But perhaps it may be found in the old-fashioned Marxian observation that morality and social norms are influenced by the prevailing economic system.

In the wake of the earthquake in Haiti, there was an enormous outpouring of compassion and generosity that seemed to sweep through every social media site on the internet as well as in traditional media. Following Benkler and Nissenbaum, it seems as plausible to me that this new altruism was perhaps in a small way, connected with the rise of the P2P ethic. But before we pat ourselves on the back, we should ask whether Western altruism makes up for the decades of neoliberal polices that allow our corporations to run sweatshops in the country and made the disaster much worse by ensuring that Haitians could not develop a proper infrastructure. Rather than mitigating the problems of neoliberalism, the new charitable ethic makes it function more smoothly by obscuring the true cause of the problem. Similarly, the altruism of individuals participating in P2P gift economies obscures their role as free labor for capitalism.


In 2002, Benkler wrote Coase’s Penguin, or Linux and the Nature of the Firm, a heavily-cited paper that argues that the rise of peer production represents the “emergence of a new, third mode of production in the digitally networked environment.” In fact, this third mode is not new, it is simply the expansion of the so-called Third Sector of civil society after being turned to an even more profitable direction. The cause of this error may be found in the first line of the abstract: “For decades our understanding of economic production has been that individuals order their productive activities in one of two ways: either as employees in firms, following the directions of managers, or as individuals in markets, following price signals.”

Dissenting from this view, Marxist feminism has long observed that the unpaid domestic labor of women is an unacknowledged source of profit for the capitalist class that the economy depends on. Domestic labor traditionally involves reproduction, raising children, caring for home and husband, but this critique takes on a new and unexpected relevance with the increasing role of unpaid digital labor under neoliberalism. Here, the sentimental elevation of maternal compassion, care and self-sacrifice appear in a more childlike form, as the kindergarten virtues of unselfishness, sharing and helping, which undergirds peer production.

Michel Bauwens, founder of the P2P Foundation, claims that ”peer-to-peer production will form the core of the new capitalist system.” There seems to be little reason to doubt this, with the minor note that it is not new. Capitalism thrives with a large gift economy, which has historically enabled rather than mitigated its extremes.

In Part III, I look at this phenomenon through Foucauldian and Lacanian lenses.

Colloqium

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