Wednesday, September 9, 2009

ECONOMICS IS NOT NATURAL SCIENCE

http://www.edge.org/3rd_culture/rushkoff09/rushkoff09_index.html

extracts from the above article.

The marketplace in which most commerce takes place today is not a pre-existing condition of the universe. It's not nature. It's a game, with very particular rules, set in motion by real people with real purposes. That's why it's so amazing to me that scientists, and people calling themselves scientists, would propose to study the market as if it were some natural system — like the weather, or a coral reef.

It's not. It's a product not of nature but of engineering. And to treat the market as nature, as some product of purely evolutionary forces, is to deny ourselves access to its ongoing redesign. It's as if we woke up in a world where just one operating system was running on all our computers and, worse, we didn't realize that any other operating system ever did or could ever exist. We would simply accept Windows as a given circumstance, and look for ways to adjust our society to its needs rather than the other way around.
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Both science and technology are challenging long-held assumptions about top-down control, competition, and scarcity. But our leading thinkers are less likely to provide us with genuinely revolutionary axioms for a more highly evolved marketplace than reactionary responses to the networks, technologies, and discoveries that threaten to expose the marketplace for the arbitrarily designed poker game it is. They are not new rules for a new economy, but new rules for propping up old economic interests in the face of massive decentralization.

While we can find evidence of the corporate marketplace biasing the application of any field of inquiry, it is our limited economic perspective that prevents us from supporting work that serves values external to the market. This is why it is particularly treacherous to limit economic thought to the game as it is currently played, and to present these arguments with near-scientific certainty.

The sense of inevitability and pre-destiny shaping these narratives, as well as their ultimate obedience to market dogma, is most dangerous, however, for the way it trickles down to writers and theorists less directly or consciously concerned with market forces. It fosters, both directly and by example, a willingness to apply genetics, neuroscience, or systems theory to the economy, and of doing so in a decidedly determinist and often sloppy fashion. Then, the pull of the market itself does the rest of the work, tilting the ideas of many of today's best minds toward the agenda of the highest bidder.

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So Steven Johnson ends up leaning, perhaps more than he should, on the corporate-friendly evidence that commercial TV and video games are actually healthy. (Think of how many corporations would hire a speaker who argued that everything bad — like marketing and media — is actually bad for you.) ... These authors do not chronicle (or celebrate) the full frontal assault that new technologies and scientific discoveries pose to, say, the monopolization of value creation or the centralization of currency. Instead, they sell corporations a new, science-based algorithm for strategic investing on the new landscape. Higher sales reports and lecture fees serve as positive reinforcement for authors to incorporate the market's bias even more enthusiastically the next time out. Write books that business likes, and you do better business. The cycle is self-perpetuating. But just because it pays the mortgage doesn't make it true.
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These theories fail not because the math or science underlying them is false, but rather because it is being inappropriately applied. Yet too many theorists keep buying into them, desperate for some logical flourish through which the premise of scarcity can somehow fit in, and business audiences won... People are beginning to create and exchange value again, and they are coming to realize the market they have taken for granted is not a condition of nature. This is the threat — and no amount of theoretical recontextualization is going to change that — or successfully prevent it.
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We ended up with an economy based in scarcity and competition rather than abundance and collaboration; an economy that requires growth and eschews sustainable business models. It may or may not better reflect the laws of nature — and that it is a conversation we really should have — but it is certainly not the result of entirely natural set of principles in action. It is a system designed by certain people at a certain moment in history, with very specific interests.
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Likewise, the proponents of today's digital libertarianism exploit any evidence they can find of evolutionary principles that reflect the fundamental competitiveness of human beings and other life forms, while ignoring the much more rigorously gathered evidence of cooperation as a primary human social skill. The late archeologist Glynn Isaac, for one, demonstrated how food sharing, labor distribution, social networking and other collaborative activities are what gave our evolutionary forefathers the ability to survive. Harvard biologist Ian Gilby's research on hunting among bats and chimps demonstrates advanced forms of cooperation, collective action, and sharing of meat disproportional to the risks taken to kill it.
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The open source ethos, through which anyone who understands the code can effectively redesign a program to his own liking, is repackaged by Jeff Howe as "crowdsourcing" through which corporations can once again harness the tremendous potential of real people acting in concert, for free. Viral media is reinvented by Malcolm Gladwell as "social contagion," or Tim Draper as "viral marketing" — techniques through which mass marketers can once again define human choice as a series of consumer decisions.

The decentralizing bias of new media is thus accepted and interpolated only until the market's intellectual guard can devise a new countermeasure for their patrons to employ on behalf of preserving business as usual.

Meanwhile, the same corporate libertarian think tanks using Richard Dawkins' theories of evolution to falsely justify the chaotic logic of capitalism through their white papers also advise politicians how to exploit the beliefs of fundamentalist Christian creationists in order to garner public support for self-sufficiency as a state of personal grace, and to galvanize suspicion of a welfare state. This is cynical at best.
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The net (whether we're talking Web 2.0, Wikipedia, social networks or laptops) offers people the opportunity to build economies based on different rules — commerce that exists outside the economic map we have mistaken for the territory of human interaction.

We can startup and even scale companies with little or no money, making the banks and investment capital on which business once depended obsolete. That's the real reason for the so-called economic crisis: there is less of a market for the debt on which the top-heavy game is based. We can develop local and complementary currencies, barter networks, and other exchange systems independently of a central bank, and carry out secure transactions with our cell phones.

In doing so, we become capable of imagining a marketplace based in something other than scarcity — a requirement if we're ever going to find a way to employ an abundant energy supply. It's not that we don't have the technological means to source renewable energy; it's that we don't have a market concept capable of contending with abundance. As Buckminster Fuller would remind us: these are not problems of nature, they are problems of design.
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We must stop perpetuating the fiction that existence itself is dictated by the immutable laws of economics. These so-called laws are, in actuality, the economic mechanisms of 13th Century monarchs. Some of us analyzing digital culture and its impact on business must reveal economics as the artificial construction it really is. Although it may be subjected to the scientific method and mathematical scrutiny, it is not a natural science; it is game theory, with a set of underlying assumptions that have little to do with anything resembling genetics, neurology, evolution, or natural systems.

The scientific tradition exposed the unpopular astronomical fact that the earth was not at the center of the universe. This stance challenged the social order, and its proponents were met with less than a welcoming reception. Today, science has a similar opportunity: to expose the fallacies underlying our economic model instead of producing short-term strategies for mitigating the effects of inventions and discoveries that threaten this inherited market hallucination.

The economic model has broken, for good. It's time to stop pretending it describes our world.




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