Commons-Based Mutualized Finance

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David Bollier:

"Financial innovation to benefit the commons is therefore an urgent priority for moving open source governance to the next level. There are actually many initiatives afoot to develop this idea, as described in a recent report, “Democratic Money and Capital for the Commons,” produced by the Commons Strategies Group.36 The report makes clear that credit and risk can be reconceptualized to serve the commons; it has been done before in various limited ways through public banks, social and ethical lending, and community development finance institutions. But there are also a number of innovative new models such as DIY credit systems, alternative currencies, tech-enabled mutual credit societies, and cooperative organizational models like Enspiral and OVNs. One might say that a post-capitalist vision for finance and money is fitfully emerging.

The ultimate goal of commons-based, mutualized finance is to develop provisioning systems that can blend the advantages of bottom-up innovation (inclusiveness, diversity, legitimacy) with the best of top-down decision-making (speed, decisiveness, scale). Commons that can achieve this sort of balance can avoid the disempowerment and exclusion often associated with top-down governance, while also avoiding the muddled responsibility and indecisiveness of unstructured decision-making.

As a nascent archetype of governance, online commons are attractive because they can host a flexible, ongoing process of iteration, self-improvement, and viral expansion. The imagination and goodwill of large numbers of people can be mobilized, without the cumbersome processes and legal formalities of conventional government. Finally, at a time when conventional political channels are dysfunctional because of ideological gridlock or single-party or dictatorial capture, digital commons provide rare, necessary open spaces for experimentation and innovation. New models can arise outside of the pathological force-fields of conventional politics, at least initially. Of course, any of the scenarios sketched above require an open, nondiscriminatory Internet, or “net neutrality,” which in turn requires state action and laws. This is precisely what many authoritarian nation-states such as China, Saudi Arabia and others reject, and even many democracies such as the US, France and the UK insist upon extensive surveillance of the digital lives of their citizens. There is thus an unresolved tension between the state and open networks that may or may not stifle new possibilities for open source governance." (