Working not working
A brief history of techno-capitalism
You could put your faith in technology. It got you here, it can get you out. This is the whole point of technology. It creates an appetite for immortality on the one hand. It threatens universal extinction on the other. Technology is lust removed from nature.
Wise words from Murray, professor at a fictional US university and surely the most lovable character in Don DeLillo’s White Noise, maybe my favourite novel. It was written way back in 1985, and I bet you thought that passage was about contemporary AI.
After a few weeks of specific stories and people, let’s step back and take a peek under the rug – the rug of contemporary capitalism that we all stand on. It touches even those in supposedly socialist or “traditional” societies, because it now weaves the whole planet into its tight fabric. No spot of nature or culture is left uncovered.
Why this diversion? It’s useful to step away from the screen, the page, the dashboard or the factory floor, to think about why we all do what we do, who benefits and who’s affected.
This particular diversion was prompted by The Hacker Manfesto by McKenzie Wark, which I recently re-read. Originally published in 1999, its insights apply equally well today, and it will be the subject of a special issue of e-flux journal in June 2024.
But it’s not an easy read – very abstract and with few examples, pretty long, and not without its flaws – some that couldn’t be predicted at the time, and some that come with all Marxist analyses, in my view.
Don’t automatically tune out at the mention of Marx – his Das Kapital is still required reading in economics departments. On the other hand, UC Berkeley, where I studied, was pretty much a Marxist indoctrination camp – the very definition of the so-called liberal elite.
And that’s one big problem I have with academic texts like the Manifesto: they speak with a voice-of-god authority to enlighten you on The Way Things Are, often without evidence or examples. Leftist politics in the US and Europe used to be linked with the working class, but it’s become detached into its own, over-educated bubble, enabling the right to sneak in and speak to (and for) the workers of the world.
I guess I’m somehow part of that liberal elite – I and all my friends read and talk about the same things, hold the same views, support the same causes. I know that such bubbles exist on both sides of the political divide – which keeps getting wider.
But I’m letting go of what I think I know. And I’m giving it all away – plundering my years of accumulated notes, ideas and potential projects and handing them to you, dear readers of this newsletter.
So please read the following introduction to macro-economics from someone with no formal training in economics. Sometimes, an outsider perspective is useful. And such a big-picture view is particularly useful for anyone working with technology these days. As you will know by now, I try to explain things in simple, conversational terms, and I’ll stick to that here. Simplifying things in this way also helps me to get things straight in my own walnut-sized brain. Stay with me.
Abstracting nature
Let’s begin at the beginning – of what anthropologist Anna Tsing calls “the capitalist linear algorithm of progress and expansion.” It starts a long time ago: when people started living in ever-larger groups, and organising socially instead of merely subsisting and surviving.
There was probably no mythical pre-capitalist time when people lived happily off of the land with no worries. But at some point, increasing experience of doing something over and over again, plus more and more complex social organisation, brings a sharing of knowledge, technological innovation, and a resulting surplus of stuff (crops, animal skins, tools, whatever).
In Wark’s words: “Out of the abstraction of nature comes its productivity, and the production of a surplus over and above the necessities of survival.” Abstraction is efficiency – its “straight lines and pure curves order matters along complex but efficient vectors”.
Karl Marx traced the birth of capitalism specifically to land, and the moment when it begins to yield a surplus. What do you do with that extra grain, ore, meat? You could share it freely with your friends and family – Wark describes such a gift economy as the same as a hacker practice of sharing information.
What if you trade your goods with someone else? Some of my grain for your textiles, say, or some of your expertise in woodworking. Something shifts there – we’ve entered a new kind of relation. The accumulation of a surplus opens up new forms of social exchange – they might be reciprocal, they might be codified into rules, they might be subverted, they might lead to conflict. But most of all, they enable larger, more complex societies.
“Land,” Wark writes, “is the detachment of a resource from nature, an aspect of the productive potential of nature rendered abstract, in the form of property.” So not only land, for Marx and his followers, but specifically where land becomes property.
Work it
So all the value produced in an economy ultimately depends on stuff that occurs in nature. This includes information and ideas, which always have some connection to the material world, whether it’s the silicon in the device you’re staring at or the neurons in your head. All resources therefore embody energy and matter that go into producing them. They might be commodities like food items or building materials, or tools to produce more things.
Fast forward to Medieval Europe. Societies attained sufficient complexity and organisation that some individuals and groups rose above others (by whatever means) to roles of leadership and royalty. With that came ownership of resources, including land.
To get more specific, capitalism arose out of the specific property and class relations in the English countryside. This was a shift in power of land owners and the people they hired to work it – a shift from friends and family to impersonal power over subjects. Workers provide their labour to a land owner, which generates a surplus for the owner, in return for their own plot of land for themselves, and maybe some protection from invaders.
It doesn’t sound like a bad deal. But let’s focus for a moment on that surplus. As before, you could share it with your friends, family, even workers. Or again you could trade it for something else. In the feudal system I just described, we’ve moved up a level. As a land owner with people to work the land for you, you can trade your surplus stuff with other land owners who grow different crops, say, or maybe with craftspeople in nearby villages. Maybe you have your own ruler (a person of royal descent, for instance) with some ships who can trade that stuff for things from far-off places.
Or, here’s another option: you could reinvest that surplus back into your agricultural enterprise to make it even more productive, and profitable – for example by trading some of your surplus for more workers, more tools, better equipment.
But that other land owner nearby is getting more workers and better equipment by selling surplus for a bit less than you do. And giving workers a bit more land too, prompting some of yours to move over there.
You can see where this all leads. Any kind of trading can evolve into a market for particular goods or services, and this brings competition between enterprises. It’s a snowball effect: such competition makes it necessary for each enterprise to reinvest more and more of their surplus back into the business, using more resources for more productive processes. Those human labourers are the most expensive, and the most troublesome, part of your business, so it pays to replace as many as possible with machines that can do more work in less time.
Where does it all end? It doesn’t. We’re talking about endless growth and ever-increasing productivity. Go up another level and fast-forward another couple of hundred years, and this approach becomes formalised in national economic policies. Every country, every business, even individuals like you and me – all try to minimise their costs (including taxes) and maximise returns. And ever since people started working for someone else, they’ve been pushed to generate more and more surplus – to be more productive.
“Lust removed from nature”
But this is only one side of the coin (more about money in a minute). Once you cover your costs – paying people, maintaining machinery – you can produce even more, and generate more profit. Surpluses eventually become so great that there’s too much. This means more enterprises can offer more stuff at lower and lower costs, driving prices down. What do you do in that case?
You either create more demand, or you somehow make your products more scarce. All that grain, metal, milk and other commodities are used by skilled people who make other things with them – bread, tools, cheese. Those are all things that your workers use daily. If you could sell these products back to them, you could generate even more profit.
This is one of the innovations of capitalism – sometimes called vertical integration – and one of the strange loops that Wark details in her manifesto: workers being sold the products of their own labour. It might start with basic provisions like food, but it need not stop there.
Have a look at psychologist Abraham Maslow’s hierarchy of needs. He didn’t intend it to be a blueprint for capitalist exploitation, but I think it works pretty well. Once you get beyond basic survival and safety, you hit social needs and self-help. To sell such things, you need to create demand, in the form of desire for things people don’t necessarily need.
Thus, marketing and consumption. Alongside productivity and profit, they enter their own cycle of endless growth. (Great example of the marketing of desire and the creation of artificial scarcity: Have you ever tried to sell a diamond?). To Marxists, the marketing of sugar, tobacco and coffee is intended to keep workers happy and productive. As for any sort of substance that hindered productivity, “What cannot be capitalised becomes criminalised,” according to academic Rinaldo Walcott.
Again, we can now see the effects of all this. When marketing arose as a profession about 100 years ago (The Image by Daniel Boorstin is good on this), no one thought that planetary resources might be finite. You can’t blame our ancestors – vegetation, soil, and the oceans can absorb industrial emissions for a long time before they break down. But all that extraction of resources and continual consumption of stuff eventually adds up.
“Sustainable development”? Forgive my pessimism, but that’s a contradiction. If you think of an economic system in a pyramid like Maslow’s, with natural resources on the bottom, what happens when you remove the foundation? Capitalism is therefore always a conflict with nature – forever trying to wring more out of less.
You only have to step outside to know that nature always wins: weeds growing through cracks in the pavement can eventually break and overtake it, if someone doesn’t pull them up. It’s a constant battle, to keep tenants and customers comfortable. But the sun will outshine human civilisation, random cosmic rays and asteroid strikes will occur, microbes will multiply.
Survival of the fattest
Nature is processed (my term, not Wark’s) into increasingly abstract forms, for the production of a surplus. “Capital” then, Wark writes, “is the detachment of a resource from land, an aspect of the productive potential of land rendered abstract in the form of property.”
Capitalism, therefore, is a system for capital accumulation, with an internal structure and external conditions of reproduction. Its internal structure is what Marx called its mode of production, made up of all that human labour and tools, and the relations between owners, labourers and resources.
Capitalism is not the only mode of production – Marx identified communism and feudalism as precursors. He envisioned a more enlightened version of communism, and pushed for this in his own manifesto (co-authored with Friedrich Engels in 1848). That was influential for a century or so. Wark describes its collapse in 1989.
It’s not difficult to understand the appeal of communism: no one owned nature before the concept of property, so why not collective ownership? That implies some degree of equality, and that’s where socialist systems have always failed: inevitably some individuals and groups seek more profit, power and control for their own benefit.
There’s some science behind this actually. Darwinian evolution is similarly founded on the idea of competition – between individuals (genes, microbes, animals) each acting in their own interest, to maximise their chances of survival. This can benefit systems at larger scales (think social insects), when individual self interests balance out, and collectively become more than the sum of their parts. When the balance is uneven, though, something changes. You can view such change as a natural part of evolution if you believe in progress and competition (survival of the fittest), or as unhealthy for the (social or natural) organism.1
Looked at this way, politics cannot simply be reduced to conservatives looking backwards and “progressives” looking forward. But while any discussion about economics is inevitably about politics, I’m trying to maintain some detachment here. What is clear, though, is that problems arose when Darwinist ideas about the survival of the fittest began to be applied to different human social groups.
Let’s go beyond our farming example, and move from what Wark calls the Pastoralist economy to the Capitalist one. Private ownership displaces people from their land. If they don’t want to work for the owner, soon they have a new option: craft people in villages form into guilds, and villages grow into cities. Cities offer new opportunities for work – for example in factories.
But let’s zoom out even further. By this time, national economies have grown to the degree that some countries could now get resources from faraway places. This is useful if your own country has depleted its own stock of building materials, agricultural land, energy resources, etc.
But global trade, too, creates an uneven distribution of wealth. A developing economy has to sell its labour and resources cheaply, in order to get more advanced industrial technology in return, so that it can develop and grow. This pushes it down a kind of spiral of under-development, plus it has to absorb all the environmental effects of all that resource extraction.
Capitalism aims to address this through “sustainable growth”, but again this ignores the fact that its form of economic progress always comes with environmental costs. When the logic of infinite growth meets a finite planet, these costs simply get moved from one place to another. Even Wark mostly overlooked this in 1999, but now comes a reckoning.
Enter the vector
In a global capitalist economy, how does all that stuff move around? Ships, mostly. Large quantities of material things are too heavy to move in airplanes. But let’s look at it on a more abstract level: logistics. If you’ve ever moved your home from one place to another, you may have had to deal with not only transport but storage, schedules, different actors.
If you’re a business owner trying to minimise your costs, you can eliminate the cost of storage if you can get your stuff from one place to another just in time for it to be sold and used. This requires tight timing and coordination between different actors in the process.
If you’re a shipping company, you find that if you use a standard size and format of shipping containers, you can streamline your costs by using them interchangeably for all sorts of goods. Kate Crawford tells how this “enabled the explosion of the modern shipping industry, which in turn made it possible to envision and model the planet as a single massive factory.”
To focus not on ships and shipping but timing and logistics is to focus on vectors. Wark believes we’ve moved from a Capitalist to what she calls a Vectoralist economy:
“Just as the development of land as a productive resource creates the historical advances for its abstraction in the form of capital, so too does the development of capital provide the historical advances for the further abstraction of information, in the form of ‘intellectual property’”
If the notion of private property led to a certain path of growth and evolution (good or bad, depending on your view), the extension of this concept to nonmaterial things suggests a new stage of development. “Information,” Wark writes, “is the detachment of a resource from capital already detached from land.” Each form is more abstracted from nature, and this makes each more difficult to gather, own and secure from competitors or criminals. Law, then, becomes more important to define and defend such property.
The “Information Age” or “Knowledge Economy” thus began late in the last century, with increasingly specialised technological development, funded by governments as well as private companies. It is partly separated from the industrial relations between labour and management in the factory system: human labour began to be replaced by technologies (now AI). But these are still based in material reality, being built from minerals, metals and energy sources.
After workers and their political supporters made some gains in wages and benefits due to poor working conditions, alongside the rise of the Information Age came the ascendance of neoliberal economic policies. This dates back to Darwinist evolution: the idea that people act in their own self-interest, but collectively this can benefit a whole economic system. Therefore, any sort of market should be able to operate freely and without any regulation, since prices and wages should “naturally” find the right level through unfettered competition. (The roots of this thinking can be found in economists Friedrich Hayek and Adam Smith and philosopher Adam Ferguson, if you want to learn more.)
The US government fused this with anti-communist sentiment (for this was during the Cold War as well), and beginning in the 1960s, began de-regulating industry after industry – that means removing any policies that artificially allocated resources. By the 1980s, President Reagan promised “trickle-down” or supply-side economics: unfettered competition promises more goods and services at lower prices, leading to an increase in overall employment. “A rising tide lifts all boats,” goes the saying.
And the good news is that it worked fantastically well, with huge rises in growth and productivity. The bad news is that the beneficiaries have been almost exclusively business owners, not workers. Since the 1970s or so, that wealth has trickled down to any but the richest people and biggest companies, in most countries.
Not only business and property owners, but what Wark identifies as the new class of Vectoralists. These are people and organisations that profit from abstract flows of information: the channels (vectors) that carry digital data. “The vectoral class,” writes Wark, “uses the state to extend and defend the privatization of information.”
Importantly, this includes money – an abstract container of value, a piece of metal or paper or digital data that only works to the extent that everyone believes in it. The notion that a promise on paper holds value as a pointer to something tangible (like a pile of gold in a vault – again everything has some material basis in the world) completely transformed and expanded trade.
Profiting from such vectors of information in the form of money leads directly to the rise of private equity firms. (Equity is the value of any sort of property after any debts are taken out – it represents the shareholders’ stake in a company for example. So equity equals sharing the wealth. In theory, anyway.)
According to Mehrsa Baradaran, private equity firms now dominate most sectors of the US economy, “from housing to health care to retail.” And this goes beyond just the US: American private equity firms now finance pig farms in China and cattle farms in the Amazon rainforest. Whereas global trade in commodities previously benefitted governments, now, according to Wark, governments instead start to serve the interests of globalised private capital.
“The vectoral class,” Wark continues, “presses the state to privatize all holdings in communication, education and culture, and at the same time to secure stronger and stronger forms of intellectual property right, even when these developments are contrary to the logic of expanding the surplus as a whole.”
Hacking the system
As I mentioned at the start, one problem I have with academic texts is abstraction. They are generally written in an impersonal, seemingly objective style that aims to illuminate hidden forces at work, often identifying an abstract villain – in the case of Wark’s Manifesto and Marxist works in general, capitalism. For others, it’s neoliberalism, or “the rich”, or “the system” or whatever.
Fair enough, but when I review academic works (including student dissertations), I always ask, Well, who exactly? Have you tried to engage with, or understand, the supposed enemy? And more importantly, are you offering a viable alternative?
That’s what I’ve tried to do here – to move from Capitalism as a general good or evil entity, to identify specific forces and actors who drive it: private equity firms, for example. It’s not difficult to identify other such actors: Within just a few pages of a single edition of the Financial Times, I found activist investors (if your idea of an activist is a rock-throwing protester, think again), resource extractors, and producers of artificial desire.
What about alternatives to capitalism? So far, nothing comes close to challenging it, except for pockets of social welfare within otherwise capitalist economies.
Wark, however, identifies a whole alternative class of people, in the title of her Manifesto: the Hacker class. Like the Vectoralist, the Hacker is born from, and thrives within, flows of information and abstraction. But instead of turning information into private property, they are devoted instead to sharing knowledge.
She identifies herself as one, and I guess I would too. “We produce new concepts, new perceptions, new sensations,” she writes, “hacked out of raw data. Whatever code we hack, be it programming language, poetic language, math or music, curves or colorings, we are the abstracters of new worlds.”
That was written 20 years ago, and you could go back even further to find the origin of the word “hacker”. It arises alongside digital technology, and Steven Levy’s excellent book Hackers: Heroes of the Computer Revolution details, in practice not theory, how hackers investigate, deconstruct and reconstruct things for fun and profit. (Geek cred: I designed Levy’s first personal website back in the day.) It’s become a contemporary myth: the two guys in a garage who developed, for example, the first Apple computer.
Indeed, for profit as well as fun. That myth is about hippies turned entrepreneurs, creating not only the world’s largest company but now the world’s largest industry. That was just shaping up at the time of Wark’s Manifesto. And she’s agnostic on the balance between profit, fun and sharing: she recognises that hackers are the creators of new innovations, but also that they often work for the Vectoralists or the Capitalists, “to states and corporations who monopolize the means for making worlds we alone discover. We do not own what we produce – it owns us.”
That said, many hackers have become very rich, and you could identify many engineers or software developers who are now uber-capitalist corporate titans. Or alternatively, cyber criminals – those who steal data and hold it for ransom. Some work within the (capitalist) system, some try to subvert it. And some are employed the state – the old capitalist/communist Cold War lives on, and hacking has become politicised. “Information wants to be free,” Wark repeats the hacker rallying cry, “but is everywhere in chains,” sequestered as private property and sold for profit. The hacker – as a class, as a practice, as a mentality – aims to set it free – for good or ill, for self-interest or the collective good.
This is where innovation comes from – it comes from hackers. And this ambiguity exists in their intentions and their inventions: as Murray in White Noise said, technology “creates an appetite for immortality on the one hand. It threatens universal extinction on the other.” And it exists squarely within a larger economic system.
What’s under the rug? I’ve focused on capitalism here, but if you want to look deeper than that, check out my article on The Architecture of Reality.
The importance of competition in evolution have been challenged by feminist and decolonial scholars – see for example https://www.e-flux.com/film/548515/lithium-lake-and-island-of-polyphony/.