Decentralising power: the why, what, how and who of growing the commons economy

Contents

Introduction
Why?
– Why do we need a commons economy?
— 1. Because this economy prevents democracy
— 2. Because this economy prevents peace
— 3. Because this economy destroys nature
— 4. Because this economy causes other potentially fatal problems
– Why is the money system such a problem?
– Why is a commons economy the way to decentralise power?
— 1. Because it doesn’t require the state
— 2. Because it doesn’t require violence
— 3. Because it doesn’t require debt
— 4. Because it involves working-class communities
What?
– What is the commons economy?
– What are commons principles?
– What are the tools at the heart of the commons?
– What’s happening already?
How?
– How do we build the commons economy?
– How do we federate to scale up?
– How will we overcome barriers?
Who?
– Who is this article for?
– Who is this article not for?
– Who will build the commons economy?
– Who will use the commons economy?

Introduction

The commons economy is an economy owned by all of us, in communities. It’s a way to build community resilience and to help decentralise power away from the state and corporations.

This centralised state/corporate power is the latest manifestation of empire. In ancient Babylon, the rulers hired priests to explain to the people why they were in so much debt to the rulers, why the rulers had to be so fabulously rich, and how the empire could grow forever without destroying nature (they were wrong, and Babylon fell). 5000 years later, rulers hire economists to explain to the people why they’re in so much debt to the rulers, why the rulers are so fabulously rich, and how the empire can grow forever without destroying nature (they’re wrong, and the current empire will fall).

We lost true sustainability and democracy when we started farming, although everyone still lived in small settlements, extremely close to nature, and made a lot of their living from the wild. There were a few thousand years between the Stone Age and the Age of Empires, with their giant cities, extreme wealth concentration and wars, and we could have ‘developed’ without empires. Wealth and power have been concentrated since ancient Mesopotamia, and still are – more so than ever, in fact. We’re still in the Age of Empire, which trundles on relentlessly, with increased global GDP and reduced global biodiversity every year. You may be resigned to the fact that there’s nothing we can do, but systems come and go, and so do ‘ages’. The next age is either the Commons Age, another Stone Age (this time in a highly degraded biosphere), or the Age of Extinction.

Why?

Why do we need a commons economy?

1. Because this economy prevents democracy

Empire can’t be democratic. Ultimately, power is economic, and if you follow the trail in any Empire institution, it’s one dollar, one vote. We’re a species ruled by corporations. The political system isn’t separate from the Empire, and isn’t going to challenge it (whatever the voting system). That goes for all governments and international institutions. Wealth concentration is accelerating and the Empire will do its best to make sure that it continues, regardless of the damage it causes, because it’s what gives the Empire its power.

2. Because this economy prevents peace

The movie ‘Oppenheimer’ highlighted the inevitability of a nuclear arms race when there’s a combination of Empire (capitalist, fascist and/or communist), perpetual GDP growth and uncontrolled technological ‘progress’. Technological innovation started when the first palaeolithic hunter picked up a fallen branch to use as a club, and has been inevitable ever since, due to the fact that cultures with superior technology (especially weaponry) dominate, control, enslave and sometimes wipe out cultures with inferior technology. I’m suggesting, not that we somehow prevent technological innovation (which would be impossible), but that we decentralise the power structures that control it, within an economy that doesn’t require perpetual growth.

3. Because this economy destroys nature

Biodiversity loss is accelerating, with nothing in place to stop it. Climate change is only one factor, and is also accelerating, with nothing in place to stop it. 28 years of useless COP meetings, and still we’re seeing record carbon emissions every year. Meanwhile, the Empire is massively subsidising the fossil fuel industry and constantly attempting to maximise GDP growth, which means maximising consumption, resource use, waste and destruction of nature.

‘Living sustainably’ in this economy is like ‘living safely’ on the Titanic. You might think you’re doing it, until you step back and see the big picture.

4. Because this economy causes other potentially fatal problems

Empire has brought improvements in terms of quantity, but the quantitative ‘upsides’ have qualitative downsides – less community, more loneliness, epidemics of addictions and mental illness, the sheer boring grimness of corporate culture and increasing existential threats.

AI represents a Faustian bargain – we gain infinite knowledge but with the risk of losing our human soul. It’s now out of our control, due to the profit, growth and defence (aka attack) imperatives – as are genetic engineering and nuclear weaponry. Soil loss, environmental toxification, antibiotic resistance and the dramatic fall in human sperm count are all accelerating. The combination of these threats puts humanity in extreme danger, and is beyond the Empire’s ability to stop, mitigate or cope with. We can’t decentralise power in time to avoid the damage that these threats are going to bring, and we’re going to keep making it worse right to the end. So in the meantime, the commons can help prepare communities for what’s coming.

Why is money such a problem?

Money is key to decentralising power. It has two conflicting functions – it can be used to buy and sell things, and it can be used to store, hoard, accumulate and become wealthy with. As long as that’s the case, money will gravitate towards stored wealth, because money attracts money and gives access to the political system. This continues until money is so concentrated and so little is circulating that the economy crashes – as it has many times. During crashes, communities are devastated and people suffer. During booms, nature is destroyed. So there’s never a ‘good’ part of the ‘boom-and-bust’ business cycle.

We need an economy in which money isn’t a commodity, that can be sucked out of communities and accumulated. If money can be extracted and concentrated to create billionaires, it will be. Local (mutual) credit is a much better means of exchange because we can create as much of it as we need, and it can’t be accumulated in few hands. It’s really an accounting system for who’s done what for whom in a community. Credit is only a problem if states give banks a monopoly over creating it and deciding who gets it. It needs to be created in communities.

Why is a commons economy the way to decentralise power?

1. Because it doesn’t require the state

How many times have you started reading a book or an article about how we can have a wonderful new world of sustainability, peace and prosperity for all, only to realise that the proposed ‘solution’ is to ask the government to do it for us? The state isn’t going to help decentralise power, regardless of the voting method. The Empire will overrule any attempt to decentralise power, and no decision-making process will be able to challenge corporate power without (economic) teeth.

The commons economy is built from communities, without extraction of wealth (so we can build safety nets), wealth concentration (so that states are not captured) or a growth imperative (so that we can at least stop making the situation worse). We don’t need permission or help from the Empire or its agents to do it.

2. Because it doesn’t require violence

Anyone who believes the working classes are going to rise up and throw off their chains doesn’t know the working class. After the 20^th century, this approach is becoming rarer. And anyway, the Empire controls a giant military machine, that will swat a violent uprising like a fly.

3. Because it doesn’t require debt or money

The co-operative and mutual / friendly society movements in the 19^th and early 20^th centuries presented a bold challenge to Empire. However, co-ops and mutuals have been around for a century and a half, but capitalists barely know they exist, and if they do, it’s often because they’re buying them and re-absorbing them back into capitalism. In the UK the Co-op Bank, Co-op Energy and most of the building societies (savings & loans companies in the US) are now owned by capitalists. They’re not threatening the Empire, because wonderful as they are, they usually have to incur bank debt to buy infrastructure like housing, or to sell community shares with returns lower than inflation; and when they stumble, asset locks aren’t strong enough to prevent clever lawyers from circumventing them. The commons is the new co-op / mutual movement, but with superpowers (strong asset locks, federation and no requirement for banks, debt or money).

4. Because it involves working-class communities

A lot of social change initiatives feel like a small percentage of middle-class people feeling good about themselves – but the vast majority of the world is working-class, and these approaches never involve them, and usually alienate them, because they don’t have the time or energy to get involved, due to work commitments and financial worries. The commons is about providing affordable, good-quality housing, energy, food etc. and jobs – exactly what the working-class needs.

What?

What is the commons economy?

The commons economy is an economy in which the essentials of life – housing, energy, land, food, water, transport, social care, the means of exchange etc. are owned in common, in communities, rather than by absentee landlords, corporations or the state. Commons have 3 parts: a) resources / assets, b) ‘commoners’ – local people who control and use them, and c) a set of rules, written by the commoners, so that they’re not lost, by being sold or used up.

The important things to understand are, first, Elinor Ostrom’s principles for a successful commons, and second, a package of new ideas and tools that make the commons much more viable now. There are lots of moving parts but they all fit together and they work. At the community level, there’s no tech to be built, just used; and the main communication channel is face-to-face; it’s not rocket science.

What are commons principles?

The kind of commons we’re trying to build are not natural ‘open access’ commons like the open ocean, the atmosphere, sunlight or rainfall, and not ‘anything to do with building community’. They’re based on the commons principles laid out by Ostrom, in Governing the Commons. She shows that communities can develop systems of self-governance to manage resources without the need for top-down government intervention or privatization. Here are her 8 principles:

1. Clearly defined boundaries: commoners understand what resources they have responsibility for, and who with.
2. Regulations correspond to the needs and conditions of the community: commoners understand the relationship between contribution and benefits.
3. Collective decision-making: individuals affected by the regulations can participate in changing the regulations.
4. Monitoring: commoners monitor and re-assess the rules / commitments themselves, or appoint others, drawn from, or accountable to the commoners who ensure they’re adhered to.
5. Graduated sanctions: commoners design sanctions for violations of rules / commitments, depending on the severity of the violation.
6. Conflict resolution: commoners devise conflict-resolution mechanisms that are low cost and easily accessible for all members.
7. Local autonomy: commoners can create regulations and institutions without the infringement of an outside authority.
8. Nested groups: if part of larger systems, commons groups are organised in multiple layers of nested groups.

What are the tools at the heart of the commons?

These new tools and ideas allow us to:

1. bring assets into the commons without debt: by issuing vouchers sold at a discount. Imagine a community energy group wanting to put up a wind turbine. At the moment, they’d need to go into debt or give away equity, which means the infrastructure will be in the hands of capitalists before long (like many co-ops and building societies). Instead, they issue energy vouchers, denominated in kWh, not £ (which makes them inflation-proof). People will want them because they’re sold at a discount, and they provide a store of value – interest-free security for old age or sickness. This basic idea can work in every sector of the economy. More here.
2. provide strong asset locks: to prevent appropriation of commons assets. Commons groups have members that are users / customers, investors and stewards (employees), but also a ‘custodian’ member class, who aren’t proactive – they just have a veto vote. They’re disinterested arbiters to make sure that the purpose of the commons isn’t compromised – such as selling commons assets to capitalists.
3. reduce the need for money, banks and interest: by ‘credit clearing’. It’s something the banks do, to reduce the need for cash to pay debts. But we can do it too. Imagine A owes B £10; B owes C £10; C owes A £10. If everyone has all the information, it can just clear, without needing money to pay debts. For networks of trading small businesses, this can be done with algorithms, covering large areas. More here.
4. remove the need for money, banks and interest entirely: within those large areas, smaller clusters of businesses can be found that trade with each other regularly. They can share a ‘mutual credit’ ledger in which all members get an account, set at zero. When they sell, their numbers go up, when they buy, they go down. There are limits to how far anyone can go into credit or debit. It’s just an accounting system, for who’s done what for whom – no money required, so nothing to extract from communities. More here.
5. federate to form the basis of a new, commons economy: all these commons projects can be connected together via the ‘Credit Commons Protocol’ – a ‘language’ that they can all speak that allows them to trade between each other – but in a federation, with no centre. Each local group retains full autonomy. Everything is interoperable – so people can pay their rent, energy bills etc. (and get paid) in mutual credit, for example. More here.

What’s happening already?

Under feudalism, ‘common people’ had commoners’ rights on land owned by the Crown, nobility or the church, to graze animals, collect firewood, glean left-over harvests, etc. Ending such rights – by legal acts of enclosure – was part of the transition to capitalism. An estimated 2 billion people today still depend for at least part of their livelihood on common resources. And of course there are many, many co-operative and mutual organisations and projects around the world, that emerging commons ideas and tools can assist.

Credit clearing is something banks do, to reduce the need for money to pay debts between each other. If it’s good enough for banks, then it’s good enough for us. According to the International Reciprocal Trade Association, around $12-14 billion worth of trade happens annually via mutual credit between participating businesses in the (mis-named) commercial barter industry.

4000 businesses on the island of Sardinia are members of a mutual credit network called Sardex, trading over 50 million euros’ worth of value per year. Grassroots Economics are building mutual credit networks around Kenya. They currently have over 80,000 participating small businesses, with thousands joining each week.

Island Power are using the use-credit obligations concept to build renewable energy infrastructure for Pacific islands – but it’s also the basic idea behind air miles and community-supported agriculture.

How?

How do we grow the commons economy?

Face-to-face, in communities. This isn’t a digital revolution – food, shelter, water, electricity, heating etc. are very material things, that have to be provided locally. And repeated social contact with people who provide things we need, in our communities, leads to moral behaviour. No-one wants to cheat or abuse those providing their essentials. The commons infrastructure that we create in communities can be federated to the national and global level, but as Damon Centola explained, to grow a movement it’s better to start at the local level where there are strong social ties between people, and build examples that other locals can emulate, rather than try to reach millions of people with weak ties between them.

This can be kick-started with just one person in each town. This person can find another like-minded person, to meet regularly and talk / learn about the commons. If those two bring in one more person each, 4 is enough. But if they all bring one more each, even better. This is a social group of people who would like to see a community-owned economy.

This is what a group of us is doing in Stroud, and we’re talking with people in other towns who want to do something similar. We can help by providing templates for a website and for essential documents (constitution, agreements, direction / vision etc.); visiting to give presentations; introducing specialists who can come to the town to participate in co-design sessions with locals interested in commoning various economic sectors; we’re also producing commons ‘toolkits’, based on what we’re doing in Stroud. Every town is different, so you can take what works for you. But housing commons and mutual credit could be the rocks on which the commons economy is built.

This approach will only work for a relatively small number of towns. We need to speed up. Stroud Commons are working with Mutual Credit Services, who, as well as helping co-design commons systems, are working on producing a ‘library’ of off-the-shelf models for sectors of the commons economy, as well as training of trainers. They’re keen to work with existing community-based groups where they exist, such as community energy or community-supported agriculture schemes etc. They’re also producing a ‘commons economy app’, with 3 accounts – a wallet for shopping, using discounted vouchers bought with cash; a mutual credit account for trading – i.e. where you do your business; and a use-credit obligation app, for savings / pension, where vouchers for essentials can be aggregated. The three accounts are connected, and eventually, all transactions can be via mutual credit rather than bank money. More soon.

How do we federate to scale up?

Commons projects can be connected together via the Credit Commons Protocol – a ‘language’ that they can all speak that allows them to trade with each other – but in a federation, with no centre. Thomas Greco coined the term ‘Credit Commons’, to describe a global system of mutual credit networks linked via a protocol. If you think of a game, like chess, then the protocol represents the rules of the game. It can be written in a non-technical way, that describes how to play chess. Chess can be played by post, with pencil and paper, at speed, or with different kinds of boards and pieces. The rules still apply to all these versions of the game. If you’re not using the rules, you’re not playing chess. So in the chess analogy, a mutual credit network is like a chess club. Members agree to come together around a protocol. They can add things on top of the protocol, depending on their preferences and agreements, software, fees, name, logo, website etc. But if someone turns up from elsewhere, they’ll immediately recognise it as mutual credit, in the same way that a chess player would recognise chess, and be able to join in. But if you decide that in your chess club, each player has two kings, then you can’t join in with international chess tournaments, because it’s not chess. The rules of chess are controlled by the World Chess Federation, who don’t ‘own’ chess – they just look after the rules and make it possible for anyone to play against anyone else. There will be a similar group controlling the Credit Commons Protocol. Here’s more on the Credit Commons.

The governance system of this new commons economy could be something like sociocracy – similar to the Credit Commons, in that it’s a fractal, recursive, nested system of ‘circles’ (like the mutual credit ledgers in the Credit Commons) that can grow to cover larger and larger geographical areas, but retain local autonomy. Sociocracy and the Credit Commons Protocol are not the only, or necessarily the best ways to do this, but as they say in sociocratic circles, they’re ‘good enough for now, safe enough to try’. At the same time, governance of cities and countries could be ‘commoned’ via deliberative democracy and/or citizens’ assemblies.

How will we overcome barriers?

The main barrier is the Empire. Concentrated power kills competition by first slandering and ridiculing it in its media, and if that doesn’t work (and it won’t with the commons, because it will be useful to a lot of people), by buying it, suing it, making regulations too difficult for it to comply with, trying to tax it out of existence, and finally with violence.

Corporate buyouts will be prevented by the custodian member class (see above). Expect attacks in the press and on TV – negative reviews, lies, scare stories, stories of failure. The state will continue to allow corporations to avoid taxes, but will wring every last drop of tax from the commons. Ultimately there could be attacks on the technological underpinnings of the Credit Commons.

The commons economy is a decentralising force, and therefore a thorn in the side of Empire – it’s not difficult to imagine Western governments becoming much more authoritarian in the face of national or global crises. This is recent UK Supreme Court Judge Lord Sumption in his 2019 Reith Lecture:

“Advanced democracies are not overthrown. There are no tanks on the streets, no sudden catastrophes, no brash dictators or braying mobs. Instead, their institutions are imperceptibly drained of everything that once made them democratic. The labels will still be there, but will no longer describe the contents. The facade will still stand, but there will be nothing behind it. The rhetoric of democracy will be unchanged, but it will be meaningless. And the fault will be ours.”

We still have the freedom to build new institutions and exchange systems, and we’re not suggesting anything illegal. At a certain size and reach, it will be unstoppable, because the Credit Commons has no centre to attack and disable. Each group has its own database, and even if the internet collapses, groups can operate with pen and paper. If it grows quickly, there aren’t enough police and troops to arrest everyone and close all groups down, and a lot of those security forces may be commoners themselves. It would be like trying to destroy an ant infestation with military force. The military would have to destroy everything to destroy the commons. There will be no indispensable individuals.

Who?

Who is this article for?

For anyone tired and sickened by Empire, regardless of whether they call themselves left, right or centre. The commons serves left and right – you don’t have to agree with every word of this article to see the beneficial potential of the commons. Left and right positions are shifting. The right is becoming more concerned with power concentration, the left with environmental destruction. But it’s perfectly coherent to believe that both are happening, and are dangerous.

The left undervalues freedom, and see the right’s obsession with it as selfishness. But it’s not – Rosa Luxemburg said that freedom of speech means nothing unless it includes people you violently disagree with. Apart from incitement to violence, the power to close down free speech shouldn’t exist, because at some point it will be used against people criticising that power – which is totalitarianism. The right undervalue equality, and see the left’s obsession with it as envy or wanting handouts rather than working hard and taking responsibility. But it’s not – it’s about concentrated wealth destroying democracy. A commons delivers both freedom and equality. More on the redundancy of the left-right split here.

Even if you don’t believe that power can be decentralised, this article is still for you, because the commons economy is beneficial in terms of affordability and community resilience.

Who is this article not for?

I don’t want to argue with people who think we can keep growing GDP on a finite planet without destroying ourselves, or that we can have democracy with current levels of wealth concentration. There’s no cheating physics, and there’s no democracy in Empire. This article isn’t aimed at those people. Arguments will just slow us down. Neither is it for those who believe that biodiversity loss and anthropogenic global warming are somehow trivial, or that there will be a magical number of COP meetings that will solve our problems.

Also, it won’t make much sense to you if you believe in the concept of perpetual technological ‘progress’. Some believe that we can give the finger to nature and continue to consume resources and create waste profligately, regardless of the damage to the biosphere, and that we can invent new tech and mine asteroids and planets to continue to colonise the universe, even though we’ve made our home planet uninhabitable, hoping that if we discover a technologically-superior species, they won’t treat us like more technologically-advanced human societies have treated less technologically-advanced societies whenever they’ve come into contact with them throughout history. If you think our problems can be legislated away or solved with technology, you must not have understood that global heating and biodiversity loss are accelerating.

Neither is this article for you if you’re a defender of this system because of the comfort, status, possessions and relative privilege that it provides you. Those people won’t change their mind or be part of the solution. They won’t help build the commons, but they’ll invest in it if it gives them a return when they can’t find other avenues, and they’ll be customers when the commons is providing useful, affordable things.

Who will build the commons economy?

Activists – who understand that we don’t actually need banks and corporations to provide what we need. There are enough of us now – less than 1% of the population can get it rolling. Activists are busy – so luckily, we can do this via very part-time activism. But it has to happen, because nothing else will work unless and until we hold the economy in common. Individual actions are insufficient, and not enough people will do them; crypto – just more capitalism; protest, demos petitions etc. are ignored or unnoticed by the empire. Activists tend to be middle class – but let’s get them building things for the working-class, rather than alienating them.

Who will use the commons economy?

Non-activists / everyone – especially the less well-off, as the commons will provide affordability and jobs. Only those with money / resources are currently able to even think about preparing for the kinds of breakdowns that are coming. By building the commons, we can provide affordable ways to provision for everyone in the community, without leaving anyone behind. This isn’t about ‘prepping’, which is focused on individuals and families, requires quite a bit of money, and guns to defend resources from other people, who are assumed to be hostile.

But first we need to build the commons economy. Please show this article to others in your community, comment below and contact if you’d like to start a commons group in your town; if you have skills to help grow the commons economy (coding, design, UX, marketing, writing etc.); if you’d like to invest in the commons; or if you’re part of a network of small businesses and would like to talk about the possibility of a mutual credit network. Be a commoner!