I wrote this article for a Free Press Houston very early 2018 ( https://www.freepresshouston.com/capitalism-is-probably-ending-welcome-to-the-centrifugado/ ).
That magazine is currently collapsing under the awful behavior of its creator, a person I’ve never met. I have the highest respect for the people quitting the magazine, given the evidence against the accused seems overwhelming.
I love the article, but made what i think is a major mistake in terminology and would welcome anyone to help me correct it. When i talk of “reducing economies of scale” what i meant to articulate really was the idea that cheaper capital and freely accessed common information would reduce the costs to produce things, which i dont think can be said to “reduce” any economy of scale…I don’t think.
Anyway, i hope the article is interesting and encourage you to inform me, or direct me to information that could inform me, about the terminology surrounding changes in economies of scale.
Capitalism is Probably Ending – Welcome to the Centrifugado
Capitalism is probably ending. And since everyone has been focused for so long on communism or world catastrophe, they never imagined capitalism may take itself into that good night. This isn’t about the noble masses coming together to wrest control, it’s about Apple being unable to stop you from jailbreaking your phone.
But, before I dare say more, we need to get something out of the way. By “capitalism,” I don’t mean a vague idea of a free market, or property rights, or even classical liberalism. I mean what the word was coined to refer to. I mean the only coherent sense of the word when people answer “yes” when asked if the U.S. is a “capitalist country.” I mean the old socialist slur that referred to how most people don’t have any control over the stuff (capital) that makes stuff and where entrenched political power is used to protect the minority of people (capitalists) who DO control the stuff that makes stuff. Now, whether you are comfortable with the words used, this is still an apt description of how things are in the most of the world, so run with it.
To understand why capitalism is probably ending, we should note two of the most important causes of capitalism: “Enclosures” and “Economies of Scale.”
Enclosure refers to a forced restriction to land, products, or even just kinds of behavior to less people than normally could access or do a thing, and this is usually done through political power (i.e. cops or soldiers would kick your ass if you did otherwise). A text-book example would be the English enclosure acts beginning in the early 1600s and going to the early 1900s, wherein various British governments would close off formerly small or communal pieces of farmland to the people who traditionally lived on and worked the land. The new estates would be handed over to larger organizations to be used for businesses like massive sheep ranches. Newly-landless peasants subsequently became cheap and desperate laborers for industrial projects in urban areas. Meanwhile, governments enjoyed increased tax revenues and political power due to newly-regulated wool commodities that had higher demand outside of Britain.
Today as well, acts of enclosure are found everywhere. Copyright law is often used by corporations to keep competition down and to keep labor cheap and plentiful; these laws restrict what people are allowed to do with what could be small capital, but instead is used only for personal comforts and entertainment. Additionally, licensing laws keep most people as wage workers instead of self-made owners and operators of small capital. Supporters of capitalism like to champion entrepreneurialism, but it’s not like you can sell bread out of your kitchen or sell bootleg CDs you make at home without the government getting riled up. You can’t just farm empty lots here in Houston. The homeless can’t just live in unoccupied houses.
Those who own “legally-approved” capital have a lot of stake in keeping us coming to them to buy the things we need to stay alive — so cops shakedown lemonade stands for not having the right paperwork, arrest the hosts of file sharing websites, and sick dogs on indigenous people for not giving up their land for commercial use. The game is rigged, and you’re on the losing side.
An Economy of Scale refers to how the cost of making stuff often goes down when you can make more of it. It’s hard to make a living making cars in your garage, even harder to get rich doing so. But if you can get a shit-ton of machinery and people in one place, you could possibly do pretty well for yourself making cars. Sure, all that machinery and personnel is crazy expensive, but if you can make loads of cars you can reduce the cost of production, allowing you to pay off your initial investment. And since people want and generally need cars, the only way for most people to get them at a cost they can handle is to get them from a mass manufacturer and not some dude in his garage. The important takeaway is that a lot of desirable stuff is expensive to make, so production is concentrated around the few people or organizations who could afford to even try. Most people may have cars, and a lot of people may work at making cars, but they don’t control or own all that machinery being used to bring cars into the world. Our economy revolves around these big and rare centers of production, and often things like enclosure laws keep it that way when it could be otherwise. But that may be changing.
Lately, a lot of capital is getting cheaper and smaller, often because capitalists research ways to cut costs by reducing the price of capital, or because capitalists are often running out of things to sell you so they market micro-capital like 3D Printers, tiny gardening robots, and single-board customizable computers. As the price of stuff that makes stuff comes down, more people might choose to make stuff for a living and cease participating in the labor market. The result is that the Economies of Scale we discussed earlier are getting smaller and more everyday yahoos get to control capital. I know the car industry isn’t in trouble quite yet, but consider the market for music, or news, or video media and how it’s changed in the past couple of decades.
Enclosures are having a rough time of it as well. I couldn’t count the amount of times I’ve broken copyright law in the past year, or, god, since we got the internet when I was a kid. Doing what you want to do, despite what the law or large corporations would prefer, is getting cheaper and easier to do without consequence. The same goes for making stuff. 3D-printers and computerized milling machines can turn out cheap unregistered guns with a few button clicks. Small antenna and cheap computer systems let rural and squatter communities set up their own personal meshnets and avoid the likes of Xfinity and AT&T. Cryptocurrencies like Bitcoin or Dash make it possible for people to more easily avoid the authorities and normal banking systems when moving and storing wealth. I paid bitcoin to gain access to a private torrenting website. Last year, I donated money to a group of scientists working to make an open-source method of producing insulin to cut through medical cartels. They still send me email updates; it’s nice.
All this to say that capitalism doesn’t exist independent of the historical and material situation we find ourselves in; it exists because of it. That situation is definitely changing, and as far as I can reason the changes happening in the last few decades rival the significance of the changes that allowed capitalism to grow out of what preceded it.
Congrats, you may get to live through the end of capitalism. You get to live through the centrifugado.
That’s what a group of friends and I down here in the coastal prairies are calling it: the centrifugado. The finale at the end of capitalism where the very innovations and growth that allowed capitalism to survive so many external pressures finally get the best of it, and fling it apart from the inside. In Esperanto, “centrifugado” means something like the occurrence of centrifugal force, and in Spanish, something like “spin.” Central to our pondering on the matter is that just as with issues like climate change and ecological destruction, capitalism is beholden to the business cycle in the here and now and has a very difficult time shifting course when its behavior may prove unsustainable. How can a single oil company attempt to bear the burden of its environmental effects if it wanted to compete with others that shuck this burden? More often than not, the primary goal is profit in the present and near future.
In the same vein, capitalist firms continue to make new technologies of personal enhancement which just so happen to be convenient devices to get around the enclosures we spoke about before, and they continue to make cheaper and more efficient machinery to shrink economies of scale. What’s important to note is that a behavior that’s central to capitalist profit is also a problem for it in the long run. But just because it’s an issue in the future, capitalists can’t just quit producing more and more desirable produce, and they sure as hell won’t quit the game and transition over to some post-capitalist, commons-based co-operative unless forced. They’re stuck. They have to fuel the centrifugado, or risk losing revenue.
Up to this point I’ve harped on how capitalists seem to be undermining capitalism. Just as corrosive to our present order are the people intentionally attacking Enclosure and Economies of Scale. Every social system has it’s reactionaries, and capitalism of course has it’s anti-capitalists. “Satoshi Nakamoto” made Bitcoin as a reaction to modern banking regimes. Rory Aronson made his open-source and automated “Farmbot” as a reaction to modern agricultural systems, and the “Free and Open-Source software movement” is partly fueled by reactions to software monopolies. There’s an incredible video of Michael Laufer (“How to Torrent a Pharmaceutical Drug”) throwing homemade pyrimethamine pills into a crowd roughly a year after pharma bro Martin Shkreli raised the price of the copyrighted version of the drug by 5,000 percent. If capitalism doesn’t kill itself, there seem to be plenty of radicals out there vying for the job.
Admittedly, maybe we’ve misidentified recent trends or overestimated the decentralizing ability of emerging technology and behavior. Perhaps unforeseen centralizing forces will come into play that make things even more unequal and centralized. Hopefully that’s not the case, but I don’t deny there’s a lot of unknowns. The biggest of which is if this can actually amount to anything without your help. If the pending twilight of capitalism puts butterflies in your stomach and dreams in your head, then you can’t just take my word for it and assume it’s a given. You actually need to participate in the centrifugado. New technologies actually need to be used to have any effect, after all, and it needs to be used when the using is good. Technology you enjoy everyday is waiting to be used to frustrate the authorities. Open-source and co-operative projects cry out for your support. The vessels to take us from collapsing capitalist shores need you to build and board them before they can embark over that glittering horizon.