DISQUS

Skydaemon · 5 months ago

Interesting article. To paraphrase a point I posted for Lessig, I think the discussion stems from misunderstanding the problem. This misunderstanding stems from why money and economic systems are important, and why hybrid economies like this are dangerous.

In brief, the purpose of an economic system has nothing to do with profit or money. Those are simply proxies. Money makes labour fungible and makes exchanging unequal work values easy. Profit is just one piece of a voluntary incentive system. The goals of all economic systems are to achieve allocation of scarce resources, efficient production, and creating a system of coercion for people to perform undesirable tasks which are needed. How else do you convince someone to dig a uranium mine if not to coerce them, either voluntarily through incentives (capitalism) or by dictation (communism). For a million bucks a day I'd dig up some uranium. Socialism is partially voluntary as per capitalism, with a bit of involuntary through taxation for social goods not supported by capitalism.

My general philosophy on capitalism vs communism can be summed up as: Anything you can do in communism you can do in capitalism with a bit of thought, and the advantage is you don't have to micromanage it. In other words I see them as nearly functionally equivalent.

Since the articles argue about the definition of socialism I will provide my own. Pure capitalism is understood to be ridiculous. It needs social/collective goods like regulators and police which the market would fail to do well on it's own. Without these it devolves into thievery, killing and various thuggery. So the difference between capitalism and socialism is some kind of line in the sand as to degree of social goods which are acceptable.

I'd argue that line between socialism and capitalism is where a reasonable person would agree that a difference of opinion would occur as to whether a good should be publically managed or provided. So, police are a social good which can be a part of capitalism since there it is agreed by all to be required for viability. However, a reasonable person would say public ownership of General Motors is a choice, not a matter of viability, and hence is socialism.

I think the internet/free economy does not count as socialism, and it's silly to discuss it as an economic system since it does not address the root purposes of economic systems, but rather ignores them.

As I argued to Lessig and others, the free economy is not viable as a replacement system without star trek replicator type technology, simply because the free economy has nothing to say about managing any of the things that we need economies to do. It doesn't manage physical good or location scarcity or allocation, it doesn't incent people to do undesirable or dangerous things. It therefore cannot replace those things fully without solving those issues. That leaves us with a hybrid, where the internet free economy wins until it hits the physical world where it loses traction.

The problem with hybrid economies such as proposed in the first article, is that the free portion undermines the other. Let's say the internet takes over and obliterates industries, automating them and offering them for a fraction of the cost, or possibly even free. Add software, newspapers, book writing, educational system, entertainment, marketing and informational research, and everything that could be called intellectual property in entirety.

The issue now is you've blown a hole in the traditional economy. It's not really a problem per se, everything is still valid and functional, it's just that now you have the same economy you did before, plus a structural unemployment problem which feeds on itself. You start with a permanent 25% unemployment rate because we no longer need paid journalists or movie producers or teachers. Next, these people either can't find work or simply displace others for lower wages in other jobs. Now the unemployed run out of savings, which reduces overall demand for the rest of the economy, which leads to even more fired people. Along the way, gov't has to downsize as it's operating off a lower tax base.

By the way, it makes no difference whether education starts as a public good or not, if the economy breaks, it loses it's ability to fund public services. Even if the free economy left education alone initially, it ends up in the same place when the public funding for it breaks down. Whether it's pulled or pushed makes little difference other than timing.

The problem is we need a certain amount of things for people to do which they can get paid for, or the economy death spirals. If you make large chunks of the economy free, it really creates a lot of long run social damage. Losing a few little things are ok. Like we might survive the loss of newspapers. But throw in software, movies, tv and marketing services and the damage starts to snowball.

I guess you could say, the free/internet economy is like a private insurer competing with a public one. It cherry-picks the desirable or fun portions of the economy leaving the undesirable things to someone else. (Ok, technically not a well aligned analogy, but by coincidence also describes part of the problem).

digitaldigs · 5 months ago

Thanks Skydaemon. I agree with much of what you say. There's an interesting turning point in your definition of the differences between capitalism and socialism where it hinges on what a "reasonable person" would think. We socialize the police force and the military (though we also have private versions of both). Education is largely, though not entirely, socialized and less so at the tertiary level. Health care... well, you know. The entire premise of a capitalist market economy rests on the concept of private property, which requires a state legal system, including enforcement.

I think we agree with Lessig is saying that the conventional understanding of socialism includes a centralized govt bureaucracy and that Kelly's idea is not that. So calling it socialism is a little strange.

I would note that a hybrid economy need not be a free economy. It's true that there are still issues with monetizing social networks, but at least in theory it's possible to make money in a hybrid economy. Indeed, that's what makes it hybrid rather than just a sharing economy.

I for one don't think you can get a decent education in a sharing economy. Exactly who does one imagine will provide my kids with a valuable consistent education for free? Who is going to educate an engineer you'd trust to build a bridge for free? Sure the information, the textbooks if you like, might be free. But who is going to provide the actual labor of teaching? If there was no labor involved, we could have just sent our kids the library decades ago.

We're never going to get the quality of movies or books or music without people able to make a living doing these things. So I think Lessig's argument is that we absolutely need copyright to ensure that these things are possible. As you know, even open source software relies heavily on experts who are also making a living doing these things and are sometimes paid to work on open source.

I imagine hybrids will emerge in some industries moreso than others. I think higher education is one of those places since in many respects it is already a hybrid economy. If we were able to recognize and value that across our culture, then I think we'd all be better off than we have been over the last 30 years where the pressure to move toward marketplace logic has really damaged universities.

Skydaemon · 5 months ago

Ah, the "reasonable person" test is something from our legal system here (Canada). I didn't intend for that to sound special. Most of our laws hinge on a reasonable person interpretation, meaning that you aren't stretching to make a ridiculous argument that only some freakish individual could believe. It's not so much a hinge of the discussion, as it is a way of eliminating extremist or distorting viewpoints from twisting legal interpretations to their own ends. Kind of like throwing out the outliers of possible opinions.

You're right if you're suggesting that near the borderline between socialism and capitalism would be a grey area requiring discussion. Again, from our legal system we deal with this grey area via case law and precedent. Essentially tests are established on a case by case basis which are used to inform future cases. So tests might include a test of necessity for economic viability, or that social benefits of collective action exceed the sum of the parts, or maybe a test of economic national comparative advantage.

The separation line ultimately gets specifically drawn by these tests, so they are the hinges. When I put viability forth, that is intended as the key test for example (it could be a combination of tests rather than a single one). In my mind, capitalist collective action isn't done for mutual benefit, it's only done for viability. But then again, I don't have any issues with accepting some degree of socialism (Canada recognizes itself as having adopted some light socialism which we're fine with as long as the collective benefits remain worth it). So if you classify education and healthcare as socialism, that wouldn't really bother me much. To me, that just means that we've agreed that we do those things not because it's needed for viability, but because it has a benefit to do so collectively (cost, standardization, quality, wide access) which we agree has met the standard of being worth doing.

To me, in order to say public education is capitalistic, you'd have to demonstrate that the economic system would not be viable without the public version. In the modern globally competitive world, you may even have a shot at making that case if you could prove that costs or characteristics of a private system would break your economy. If not having it public, disadvantaged you to an extent where you couldn't compete and your economy was not viable long term, then maybe you might be able to call it part of capitalism. But under the viability test, that would be the case you'd have to make. Arguing that we should because it's beneficial wouldn't be good enough.

The point of these tests is to frame the discussion to that which actually determines the line, rather than broad irrelevant neverending arguments.

Interestingly in Canada, health care is not argued any more than education is. Even our conservative parties support it. Then again we acknowledge ourselves as a light socialist system anyway. I find it interesting that the american discussion of the public health care option is as limited as it is. I'm not sure if americans realize it, but our healthcare system up here has attached systems such as transfer payments. Our provinces literally pool up money and distribute it in a direct handout to poorer provinces, nominally for the purpose of ensuring consistent healthcare standards across the nation. Direct wealth transfers to support consistent entitlement systems, how's that for socialism.

Regarding training. The trust doesn't come from the manner of teaching, but rather the enforcing of standards and testing. Would you trust that engineer if he studied on his own, but came in and aced every single test offered by the school system?

If you told me that engineer had to survive rigorous testing which was somehow secured from cheating, I wouldn't see a big difference between that and where we are now. in fact, if his report card was changed from an overall "grade" to individual grades by specific skillset I might find it more interpretable.

Most professionals produced by schools are not given an assumption of trust when first hired anyway, partially due to grade inflation effects, and people lying on resumes about jobs and education they possess --happens more often than you'd hope. We've been in a prove-it job system for a while. It also flows from the skills taught not being perfectly aligned to actual practice in business, so there's some additional integration anyway. I'd imagine that engineer ends up effectively apprenticed his first years as we do with most other highly skilled specialists. If you look at doctors, programmers, engineers or just about any other specialist skillsets, nearly all have informal apprenticeships or mentoring programs of some type.

So how about that then. Do you trust an engineer who trains on his own in sophisticated video games, who can ace all the testing material in secured tests, and ends up apprenticed to a real engineer in his job for the first 3 years before being given real responsibility?

I'd argue that isn't inherently worse than what happens now.

digitaldigs · 5 months ago

I'm assuming that the real engineer is getting paid to oversee this three-year apprenticeship. And that this student will be receiving a broader education, outside of the narrow field of this particular career, in some other venue where people are getting paid to teach him/her? Meanwhile the engineer is likely only going to be training that student to accomplish limited tasks that meet up with the particular work that engineer is doing for his/her corporation. Is that going to be a sufficient education?

I guess here's my point about education. Hypothetically, you could get an education by downloading syllabi, reading the texts, listening to podcasts on iTunes U, etc. Maybe you could even throw in some kind of social networking of students. Maybe you even hire a mentor to shepherd you through the process and its still way cheaper than college. Then you have some certifying agency that uses testing or portfolio review or something to verify that you merit a degree of some sort.

Thinking in terms of a humanities degree. In my experience, the chances of a student passing even a minimal portfolio review in an English degree without close mentoring from faculty is fairly slim. Let's say that maybe 20% of the students who get degrees now could pull it off. And their educational experience would be diminished by following this route. B/c not everything you learn is on the test or in the essay you write.

Still, then you could stick that student as an apprentice with a PR firm or marketing or publishing or whatever. And I'm sure they would learn things. However, we know the old saying about those who can't do, teach. That may or may not be true. However I will say that just b/c you can do, doesn't mean that you necessarily can teach well. An apprenticeship may or may not be valuable. It certainly would not equate with an education in the humanities.

I guess as an educator, I think I provide something of value that you aren't going to get for free online. Maybe the outlier student can educate him or herself using the resources and communities of the Internet, but the vast majority of students require teachers. If that weren't the case then we would have replaced colleges with libraries a century ago.

And this is my main point. If we accept the premise that we are entering an economy where more citizens will need more education then I think we are looking at moving in the other direction, of offering a larger institutional support structure for higher education.

Skydaemon · 5 months ago

Even though it's a separate issue, I'll make a point on the following:

"We're never going to get the quality of movies or books or music without people able to make a living doing these things. So I think Lessig's argument is that we absolutely need copyright to ensure that these things are possible."

I'd agree with the first statement, and totally disagree with the second. I can think of a number of business models for the web and various creative works, all of which are utterly destroyed by the presence of copyright. I really do not think the ability to develop a living doing these things openly is going to be possible until copyright is scrapped or ignored. I see it as a requirement to ditch it.

I'll give an example. Picture a subscription music service. Where you pay say $200 a year for access, in return you get access to the entire body of all music produced ever. What you listen to or download is tracked and measured for the purposes of funding artists who register when their music is listed. 90% of the funding is divided into say 4 tiers. Funding is divided amongst all the artists who make it to a given unique person access count tier. So if you get 1000 listens/downloads by unique people, you get a share of the first tier worth of money (a quarter of subscription amount), if you make it to 10,000 you get a share of the next 25% tier, 100,000 you get the next tier, 1,000,000 the next tier. Take another 5% and use it to improve specific voted on artists who should be able to move up in calibre with a big of support or something, let the customers vote on the talent to support. Maybe these tiers aren't perfect but you get the idea. Assuming you got 10 million people to subscribe, you'd be distributing $2billion this way, with $450 million per tier and $100 million for up and coming artist development.

Introduce copyright, and this whole model is instantly unviable. Now you have no money to start up the service, and you have to fight through thousands of contract disputes with artist representatives where they want to strangle you before you get your first customer. Invariably, you can't offer a good service, and you're wrapped in restrictions that suck enough that you predictably fail.

I'll point out 2 more things.
1) Artist groups are popping up very much like the above right now, songs, art pictures, you name it, and they're doing it either for nothing, or as part of a contest. And in some of these cases they're used as portfolios for artists interested in work. For example, it's common for flash game programmers to negotiate with songwriters from these groups to provide music for their next flash game and so on. It really helps for making distributed development possible. Essentially it's creating artist bizarres or markets, sort of flea market style where you can shop for talent to help you build a new work. Quality is not a matter of having professional backing, it's a matter of making powerful tools available publically and creating an incentive system which rewards quality and shows a path to achieving it. These artist bizarres often have comment oriented customer feedback systems so the artist can learn what was liked or what needs work.
2) Copyright is designed to support corporate infrastructures that surround artists, not the artists. I'd suggest that assuming large corporate infrastructures are needed to produce quality is not a guaranteed bet. I admit that individuals have difficulty finding the time, resources and equipment to do it. But I also think that there is a possibility of advancing the power of tools, distributed team formation to help, and real benefits from opening the arena up to wider competition from people that were previously excluded.

"As you know, even open source software relies heavily on experts who are also making a living doing these things and are sometimes paid to work on open source."

To begin with, open source is kind of a joke. As far as I am aware, it was mainly put forth as a marketing gimmick by specific companies, and there is little to nothing open source about them. A number of companies produced it as a way of breaking out of a rut they were in where they couldn't sell their hardware. They believed that giving away the software would lead to a viable hardware business and break the competitive disadvantage stranglehold they were under. Many of these companies lost and are losing a lot of money under this approach, and don't look viable long term. See the recent collapse of Sun, which was on the verge of bankruptcy (which would've wiped out Java and mysql among other things). The only reason these still exist is because Oracle needed Java enough to buy them (Oracle has written several utilities, front end access layers in Java and needs it to buttress against becoming beholden to Microsoft). Even so, there is no guarantee that Oracle will share Sun's desire to continue open source projects, and could easily convert them back into the commercial sphere or discontinue unneeded ones. If Microsoft had bought Sun, Java would be history. Keep in mind in tech, the DOJ cannot reverse a takeover like that. If the dev team flees because MS tells them they're finished, it's dead whether MS ultimately takes it over or not. Dev teams are fragile, and the legal process is poorly suited to the flexibility and speed needed to keep them alive in hostile situations.

Exposed corporate code source would be closer to it than open source, and miniscule amounts of the work is done by outsiders on most big projects. To say nothing of the source gatekeepers controlled by corporate HQ. Much of open source work is akin to outsourcing QA and some minor bug fixes with a review process by corporate engineers anyway. As a rule of thumb, if you cannot check in changes, you are not really part of the team. There are legitimate open source projects, but few amount to anything meaningful. I really think open source will largely die when it's main corporate backers go under.

digitaldigs · 5 months ago

I will accept your description of what's going on with open source. I certainly won't pretend to be an expert there. I will say that I think the model of collaboration associated with open source (fictional or not) would work for academic research in the humanities b/c the fundamental ethos of our scholarly practices is to share widely with the culture.

I'm not sure about the music example. If copyright didn't exist, what would stop someone from making digital copies of the music and sharing it for free? Without copyright (or something virtually identical to copyright) there would be no legal recourse, right?

Skydaemon · 5 months ago

Regarding music and copyright.

Clearly, copyright has no impact on the ability of people to make digital copies and share for free. Everything out there is already available for free. Maybe I don't see the deterrent you refer to. The laws are ultimately unenforcable. Consumers have clearly declared that they are no longer willing to work with the abusive monopolies that control the music world.

-Consumers want the right to not be controlled and dictated to by a monopoly about how they can use their products after they've acquired them.
-Consumers are not willing to pay monopolistic pricing well above the value they actually realize.
-Consumers are not willing to buy batches of songs when they only want one.
-Consumers want it to be digital and have open compatibilities with various hardware they may own.
-Consumers don't want to re-purchase the same song every 4 years when they come out with a new cassette, or CD, or whatever else they dream up just so it can be compatible with modern hardware. Planned obsolescence is BS and not a valid business model for companies that want to have a future.

The only thing copyright is effective in stopping is the creation of business models which don't rely on monopoly powers or abusing customers to work. Copyright doesn't fix anything, but it does prevent us from moving on to new viable models.

So the question is, in a world with free music, why would anyone pay a subscription fee, or give extra tips to artists directly?

1) They want to support the artists, especially if they know that money will improve their work in the future, or cause more of it to be made. If you pay new artist X money, maybe they will make you another song, or perhaps it will be a higher quality. This is essentially a new business model, like a charity or NGO, where you are paying in order to cause an effect and support things you appreciate. It's stems from a desire to give back for that which you appreciate, and to encourage more of what good things you find in the world.

2) Quality additional services and access to new artists that would otherwise be excluded. This includes having quality song uploads. There is a cost to having to figure out whether the junk you're downloading is just spam, or a mislabelled song, or if it's only half a song or whatever. There is a benefit from having a single list of songs from known sources (artists) which you can develop some trust with.

Also, maybe you can see a listing of what the artist thinks is good music, or find other users on the system that have similar preferences to you and thus gain a benefit from being able to locate unknown music you really like with more ease.

3) Convenience. Why search the internet for quality copies when it's all in one place.

4) Promise of future song access and timeliness.

5) Ability to interact with the artist. What if your subscription allowed you to talk to the artist and give direct feedback to them about their song. Maybe you can get an updated song uploaded with changes, or help the artist to get better, or vote on what you'd want to hear from the artist in the future.

And so on.

The point is, there is a lot of room for fundable business models which make both artists and consumers happy. The space between abusive and restrictive monopoly, and underground warez sites contains a lot of area that could support real business. Some of which allow people to get paid for creating content, and for making services that enhance consumption and delivery of it.

Ultimately the one which is successful will be the model in which consumers are willing to gravitate to en masse.

You might say, but you can make a business that gets paid without paying artists. See reason 1, 2 and 5 above for why funded models can be successful, as examples of why models which have the support of artists and fund them, have value.

The only thing that blocks us from trying to find these new models, is copyright. Copyright makes the monopolies gatekeepers (from which there is little to no benefit, and consumers have already declared that they prefer underground economies to). It cannot stop consumers from acquiring music for free, it can only stop paid businesses from existing.

The fight over copyright is about whether monopolies have the right to levy charges just for being monopolies, and whether they can dictate to consumers the terms of usage. This fight is already over. The consumers chose the underground economy over that, and the monopolies have already lost this fight. By definition, the monopolies have lost their monopoly powers as they can no longer restrict access or dictate terms. The future cannot be dictated to consumers, it is now about choice and value.

The sooner governments ditch support for the monopolists, the sooner we move on to new viable business models and services which work for everybody.