Computers in Barnes’ Capitalism

I’ve been quoting from Barnes’ Capitalism 3.0 for a few weeks (the entire book is on a creative commons licence at http://capitalism3.com/files/Capitalism_3.0_Peter_Barnes.pdf)

A couple of quotes I like:

Technology, of course, greatly magnifies our impact on the planet, but technology by itself is mere know-how. It’s the choice of technologies, and the scale at which they’re deployed, that affects the planet. Electricity, for example, can be generated in many ways. When corporations choose among them, however, their choice is driven not by “least harm to nature,” but by “most bang for the buck.” p27

Similarly, in the early capitalist era, land, resources, and places to dump wastes were abundant; aggregated capital was the scarcest factor. That’s why rules and practices developed that put capital above all else. In the twenty-first century, however, this is no longer the case. As economist Joshua Farley has noted, “If we want more fish on our dinner plates, the scarce factor isn’t fishing boats, it’s fish. If we want more timber, the scarce factor isn’t sawmills, it’s trees.” p23

 …we shifted into surplus capitalism, or what I call Capitalism 2.0. In this version, there’s no limit to what corporations can produce; their problem is finding buyers. A sizeable chunk of GDP is spent to make people want this unneeded output. And credit is lavishly extended so they can buy it. This historic shift can be described another way. A century ago, our chief scarcity was goods. It thus made sense to sacrifice other things in pursuit of goods, and capitalism was masterful at doing this. Today we’re waist-deep in thneeds, and our scarcities are different. Among the middle classes, the top scarcities, I’d say, are time, companionship, and community p22

As The Economist has written, “The great virtue of the single bottom line is that it holds managers to account for something. The triple bottom line does not. It is not so much a license to operate as a license to obfuscate.” p52

I also like the premises for the book: p12
– contract (future generations)
– we are not alone
– illth happens
– fix code, not symptoms
– revise wisely
– money isn’t everything
– get incentives right

In addition to the inherent elegance of the notion of Capitalism 3.0, of course the real reason I like the book is that he uses computing as the metaphor (for what is wrong as well as the solution)…

The anachronistic software that governs capitalism today leads, willynilly, to three pathologies: the destruction of nature, the widening of inequality, and the failure to promote happiness despite the pretense of doing so. p 25

despite the Supreme Court’s holding, the modern corporation isn’t a real person. Instead, it’s an automaton designed to maximize profit for stockholders. It externalizes as many costs as it possibly can, not because it wants to, but because it has to. p22

Why does surplus capitalism behave this way? It’s possible that we consistently hire bad CEOs, but I think otherwise. I think it’s the operating system that causes most CEOs to act not with the next generation, but with the next quarterly statement, foremost in mind…if we want to change the outcomes of Capitalism 2.0, we have to upgrade its operating system. p32