Decentralized Trade Economies
"Peer-to-peer trading is being increasingly explored as a method to cut out corporate control of the trade economy. Peer to peer trading looks like the diagram above. People can trade directly with each other, or through a network, eliminating the central hubs that control distribution and block access of goods. An alternative distribution is the gift economy which follows a similar diagram but does not involve direct exchange; instead goods are given and it is hoped that equivalent goods will be returned. A common model to discourage freeloading in a gift economy is to require a certain level of contribution from each member.
The peer to peer-to-peer / gift economy structure is encouraged as a form of trade suitable to a non-hierarchical society. That depiction is based on an incorrect picture of the society those trading nodes belong to. The difference between a trade relationship and a society with dependencies is obvious to those dependent or unequal in society. Anyone unable to trade an object or act of direct value to a person in power will be left out of a trade network and dependent on charity as shown in the diagram below. The peer to peer model eliminates the corporate hierarchy but leaves the patriarchy alive and well.
Peer-to-peer and gift economies do not allow for society’s input to be inherent in the trade transactions. The value of goods traded is rarely created solely by the trader. Some production builds on previous work, some makes use of assets from the commons and some is produced at the expense of work left for others. Some products may violate human rights of others or damage the environment or the society. Trade relationships relate only to negotiations between individuals and do not reflect impact on an entire society.
Power in peer to peer and gift economies is retained by those that control assets. Not only does this not benefit all of the people who historically don’t benefit in capitalism, it is easy in the diagram below to see how the cycle will progress right back to where we are today as wealth will again concentrate in those who hoard assets and avoid caring for dependents. Peer to peer trade relationships are simply decentralized capitalism. Bringing that system back to its origins with no change will certainly produce the same result over time which it has produced now.
In the diagram above, the two traders who have pooled their resources and have no dependents are the most powerful. The one with six dependents is working far harder and obliged to divide their assets by seven. The disabled individual all by himself, and the one supporting twelve children and two elderly parents cannot participate in the trade economy at all and are dependent on charity. Their needs are not inherent in a trade economy.
For every member of society who has something of outside value to trade, there are dependents who have nothing and others doing the internal society building work. All trade must benefit those powerful enough to reciprocate. People providing palliative or geriatric care, working with the mentally ill or children, or with criminals not participating in the economy, will have no means of survival except charity or a resurrection of the institutional structures described in Society vs Dissociation. Those whose own survival takes all of their available resources because of illness, disability or age, those investing years in a long term project with no observable output, or those working in research and other thought based fields also have no inherent value in a peer to peer structure and must have their needs tacked on as a charitable addendum or debt obligation.
A few months ago, an article appeared in a Canadian newspaper. It told the story of a very young woman in Uganda raising six children, all the product of rape, after being abducted at 13 to become a child soldier. The photojournalist gave her a camera and sold the photos she took with it. When he gave her the money, he said “This isn’t a handout. This is money you’ve earned.”
Consider that for one minute. Raising six children she did not ask for while still a teenager herself, being pregnant or recovering for six years, breast feeding all of these children for however many years, providing food, shelter, clothing, safety, medical, educational and other care, all 24 hours a day, seven days a week while in extremely dangerous and uncomfortable conditions and recovering from severe trauma, with no societal support and in fact in danger from society, was not worth payment. She is expected to sacrifice her health and risk her life for a job that was not worth payment. Surviving all the trauma of her life did not entitle her to support from society. Trading a picture was considered providing something of value and contributing to society. This is a society conducted as a trade relationship; she cannot sell her children, therefore her work for them is of no value. It would however be illegal for her to let them die, so she is legally slave labour. Slavery of caregivers and others in this and many other instances is the only reason societies under capitalism can survive.
There are many groups today advocating living a money free existence by using barter, scavenging, peer-to-peer trade and gift economies. Women have been living a money free existence for most of history. Women devote a year of their lives to each pregnancy and recovery period and still do by far the most society building and caregiving work worldwide; in trade economies they have to add additional labour on top of this to create some product of exchange that will appeal to a person in power or they and all of their dependents will be at the mercy of those in power. The peer-to-peer barter or ‘gift’ economy required for many to survive has been called the world’s oldest profession: prostitution in an endless variety of forms, many called marriage. Trade economies are rigged against women in traditional roles and anyone else creating or supporting society. The answer for equality in this system has been for everyone to reject support roles and embrace trade economies.
Peer-to-peer networks provide no improvement for the rights of the weak as shown by a history full of peer-to-peer extortion gangs, paedophile networks and brotherly revolutions which became tyrannical immediately upon seizing power. Peer-to-peer is a survival of the fittest structure which ensures slavery of the weak. The persecution of the weak found in societies without inherent protection is frequently followed by a guardian coup d’état as when women are legally barred from bending over in Swaziland, sitting astride motorbikes in Indonesia or owning cell phones in rural India for their own ‘protection’. In a society with a trade based economy, currency and centralized power offers more protection to the weak than a peer-to-peer structure. This has been seen by the improvement in women’s lives when they have the right to vote and work for pay, and protection is provided (however theoretically) by the state.
When asked how they would allow for dependencies, advocates of peer to peer or gift economies speak of being ‘generous’, ‘giving’ food to the less able, and nearly always also mention condemnation for anyone having more children than they can provide for themselves, addictions, etc. In fact even one child puts the pregnant, nursing and responsible parent at a huge disadvantage and causes them to have to work far harder, for far less, and then need to divide their earnings. A number of dependents like six or more makes it difficult to survive. Many people around the world have far more than six children as well as care for other dependents in society. Even if the birth rate were reduced, every state in the northern hemisphere is experiencing an explosion in the elderly population, and disasters, environmental harm and other factors can cause sudden huge increases in dependents.
The decentralized capitalist structures treat this ‘problem’, in very much the same way as their corporate capitalist predecessors, with a begrudging charity or more hostile superiority and blame for those disadvantaged by their system. The value attached to trade versus creation and support of society is evident in every part of life, from obnoxious business travellers and others treating child caregivers as an untouchable caste to the removal of the elderly and less able to a dependent, burdensome role instead of recognizing the contributions and effort they are still providing or could. The nostalgia for a time before rampant corporate capitalism took hold, when ‘everyone’ benefited from peer-to-peer trade is an entirely masculinist view with a very narrow definition of ‘everyone’. As the male role in society has expanded to include far more caregiving, a trade economy suits no one." (http://georgiebc.wordpress.com/2013/02/28/an-economy-for-all/)
The alternative: the Approval Economy
"To benefit all of society, an economy needs to be based on service to all of society. In today’s economy, service is bought and sold as a good; instead goods must be provided as a service. An economy benefitting all of society should include service to ourselves, service to others and service to society at large. An elderly person who keeps themselves healthy and fulfilled or an addict working to conquer their addiction may be giving only to themselves but both are making society a much better place and lessening the work for others. To create a giving economy instead of a gift economy, currency is not exchanged between two trading partners but societal approval is awarded from all of society to the giver. Societal approval and trust then entitles each member of a society to receive benefit from that society, through a living and immediate social contract. As a reputation economy allows you to participate in trade, an approval economy allows you to become part of a society.
Trade economies attempt to symbolically represent societal approval by possessions. As monarchs were formerly held to rule by divine right, trade economies insist wealth is due to virtue. While hoarded possessions have been used as a symbol of acceptance, they do not fulfill the real social need for acceptance. The wealthy are instead resented and isolated, shunned by the society they supposedly are the elite members of. Underlying every patriarchal society is the idea that caregivers, children and dependents should be grateful as trade economies see them as burdensome. Those who see a disparity in labour for the family and community are not at all grateful. Family wage earners resent not gaining love and approval for their work in trade, but because trade economy derides unpaid service, they receive no respect for support and creation of the family either. In a trade economy, the currency exchanged separates the giver and receiver; because the currency entitles the receiver to the gift they are not grateful. The human need for social and familial approval is almost never adequately met in trade economies.
As possessions in a trade economy include the service of others, those who do not work for the benefit of others are the powerful. An economy based on societal approval equates not working for others with being excluded or shunned. In an approval based economy, control of assets does not bring power. Assets are not assigned worth until they are contributed to the society. Internal support contributions are not valued less than external trade contributions.
Work in an approval based economy provides society and affinity groups; it is less stressful to be part of the society than to be isolated. Gifts are bonding, both within family and friends and at a community level. In an approval economy gifts are not a tax or state confiscation which leaves nothing; wealth is created by giving. Acceptance by society is based on actions instead of assets. Those dependent in society for some things also have gifts to give, acceptance and approval being the most valuable. Politicians propped up by military and corporate interests hated by the people are the antithesis of societal approval as the mark of acceptance. The dissociation of power in society from service to society provides fertile ground for sociopaths to seize power.
Those creating and supporting society should not need charity, they should have power. An inclusive society does not leave some dependent on the charity of others, or make some work far harder for the same ends. Where there is inequality there will always be tyrants; giving birth, aging or accepting responsibility for another should not be equivalent to accepting a slave role. ‘Women’s issues’, the elderly, the youth and the less able cannot be special problems to be dealt with on the fringes of society. Care for dependents of society is the responsibility of all, and dependents should have power to gift approval to those who assist them. Economy cannot be rigged to favour one special interest group. The solutions for all of society must be inherent within the economic system.
In an approval economy, effort to benefit society is recognized and acts against society are penalized. Approval is related to assessment of fairness, not the value of the gift. The work of an elderly person talking to a child, a scientist conducting research, a maker providing goods, a child learning and a mentally less able person gardening have no value differences, though the effort expended might. In the chart above, the person with a score of 91 has decided to be a pillar of their society. They probably belong to few other societies, and devote formidable energy to providing for this one, belonging to many working and discussion groups and making themselves available and responsible for the wellbeing of others. The people scored 58 and 52 may be just visiting or may belong to many networks or perhaps they prefer to spend their days on the beach, doing only the basic amount necessary for good standing. They may be entitled to basic essentials like food and lodging but not community resources such as cars and maker labs without additional barter. 55 and 50 expend effort, but also cause harm. Perhaps they are struggling with addiction or mental illness, Their effort is recognized by continued support but at basic levels to restrict their ability to harm others. The person scored at 15 is probably completely shunned by the society, perhaps even imprisoned.
An approval economy is the economy people rely on when they do not use direct coercion, the one typically seen in families and unfunded cooperative and volunteer groups. What the approval ratings mean in terms of benefits earned and whether there are formal values at all varies by society. Being part of a society may require more effort at some times than at others. For instance, not assisting to put out a fire or provide emergency aid to another may be considered an act against society rather than simply a failure to contribute. The benefits of belonging to a society will dictate how motivated people are to contribute to it." (http://georgiebc.wordpress.com/2013/02/28/an-economy-for-all/)