Scenario 1999: Digitalizing the Modes of Production

It may not seem like it, but Neoliberalism has been experiencing immense difficulties trying to reapply the shared paradigm of Production for Profit and Production for Utility in the digital realm. The issue was not exactly whether the digital realm was even capable of creating Kapital and Schuld. The World Wide Web (WWW) in the 1990s and 2000s, as evidenced by the Dot-Com Bubble, have shown that Financial Markets and Fractional-Reserve Banking Systems had established potential sources Kapital and Schuld on the WWW. It is also not an issue of whether the Market/Mixed Economy cannot adapt to the digital realm. Commercial Media outlets and Retail Industries from the Service Sector have tried to compete with the Social Media and eCommerce platform of the WWW and they did succeed in ensuring their overall survival, even though some of them ceased to exist altogether.

Intangible Assets: Neoliberalism’s Antithesis to the Work-Standard’s Digital Arbeit?

What Neoliberalism is facing in digital realm, even within the digital realm, is an issue addressed throughout The Work-Standard (2nd Ed.), The Third Place (1st Ed.), and Work-Standard Accounting Practices (1st Ed.). As humanity’s political, economic and social life becomes intertwined with the digital realm, there has been the issue of Kapital becoming increasingly abstract or intangible.

In the 19th and 20th centuries, Kapital and Schuld used to have been consistently tangible and were provided by privatized commercial banks and Financial Markets under the Fractional-Reserve Banking System. Privatized commercial firms once had physical or “Tangible Assets” like buildings, land, machinery, tools, vehicles and so forth that can be quantified based on their relations to Kapital and Schuld. The rise of the digital realm has resulted in the growing prominence of abstract or “Intangible Assets” that cannot be easily quantified as Kapital and Schuld. The Accounting Profession internationally defined Intangible Assets as:

An identifiable non-monetary asset without physical substance. Such an asset is identifiable when it is separable, or when it arises from contractual or other legal rights. Separable assets can be sold, transferred, licensed, etc. Examples of intangible assets include computer software, licences, trademarks, patents, films, copyrights and import quotas.”

Think about the PC, tablet, or smartphone that one may be using to read this Entry. In Production for Profit and Production for Utility, the Reader’s PC, tablet and smartphone are Tangible Assets whose Values can be quantified in terms of Kapital and Schuld. It costs the manufacturer this fixed Quantity of Kapital to build the PC, tablet or smartphone. The Reader also spent a set Quantity of Kapital to purchase that same PC, tablet and smartphone. One may have accumulated some Schuld by using a Credit Card to obtain them, which validates the concept of Tangible Assets.

Meanwhile, the computer software that enables the Reader to read the Entry as a .PDF file or as it was posted on The Fourth Estate are Intangible Assets. They are recognized as such by the Accounting Profession (and by extension, the Fractional-Reserve Banking System and Market/Mixed Economy) because the production cost can only be measured in Schuld and because there is a possibility that it will yield some Kapital in the future. While there are guarantees about the Quantity of Schuld, the Quantity of Kapital cannot be easily determined.  

How does Kapital Accumulation occur in the latter context? Imagine that I, the Author, were to deny access to the content of this Entry to the Readers of The Fourth Estate. I would inform the Readers that, “in order to continue reading of this Entry on the very topic” and “have access to exclusive content on my Blog,” they must each spend $5.99 USD per month. Kapital is transferred from the Reader to the Author between bank accounts on a monthly basis, the process occurring in the digital realm. Alternatively, if somebody happens to be reading the Entry as part of a completed Treatise on a .PDF file in Adobe Acrobat, the same logic applies for Adobe (the privatized commercial firm that developed the software).

WordPress and Adobe are not the only exceptions insofar as Paywalls and Subscriptions are not the sole methods of Kapital Accumulation from so-called Intangible Assets. Crowdfunding and Venture Capital are two other well-known cases:

  • For Venture Capital, I borrow just Kapital from somebody who thinks they will earn more Kapital for themselves without physically and formally engaging in the everyday activities. Whatever economic activity I happen to be doing, the people who gave me their Kapital are expecting to receive Kapital from the endeavor, otherwise I earn Schuld in the process because I failed to pay them back.
  • For Crowdfunding, I set up a GoFundMe or a Patreon where anyone could send me Kapital in return for continuing to write on The Fourth Estate. If they, for whatever Intent, enjoy the content of The Fourth Estate, they can transfer their Kapital to me.

All of the above demonstrate the same phenomenon associated with Intangible Assets as Neoliberalism’s attempts to suppress the possibility of creating Digital Arbeit. The problem with the proliferation of Intangible Assets facilitating Kapital Accumulation in the digital realm is that Market/Mixed Economies find fewer Incentives of creating Kapital from the production of Tangible Assets like Commodities, finished goods and services. Since land, buildings, machinery, tools, vehicles, and so forth are Tangible Assets require expenditures of Kapital, the privatized commercial firms of Market/Mixed Economies in the Western world have found more Incentives for Kapital Accumulation from Intangible Assets.

If the digital realm any privatized commercial firm with the ability to mass produce something with little or no expenditures, there really is no point to have a lot of employees, assuming that their employment entitles them to high salaries, health insurance, retirement pensions and even access to LCFIs (Liberal Capitalist Financial Instruments) like Stocks and Bonds at preferable rates. This of course has led to the rise of the Gig Economy and why its existence cannot be made possible without the digital realm and the ability to earn Kapital from Intangible Assets. These effects can potentially be amplified by Automation and Globalization insofar as the “labor market” and “job market” have found convenient platforms on Social Media, as evidenced by LinkedIn, Indeed, Monster, Glassdoor, Handshake, and others.   

Does one realize how everything described here represents a self-perpetuating cycle that has led to people in the Western world and elsewhere to become deprived of Meaningful Work? That all abilities to create Arbeit and Geld is being suppressed by Technologies designed to further interests of Kapital and Schuld?

On the Issue of Crowdfunding

As the Author of The Fourth Estate and someone interested in someday allowing donations from Readers, I am facing the issue of where I stand on Crowdfunding with regard to the Work-Standard. In the context of the world order in Scenario 1999, do people receive Actual Geld while contributing Digital Arbeit and Digital Geld on the National Intranet? My stances on Crowdfunding are to be inferred from my conclusions established elsewhere regarding the presence of Actual Geld in the National Intranet. Back in The Third Place (1st Ed.), the creation of wealth in the LER (Life-Energization Reciprocity) and LERE (Life-Energization Reciprocal Electrification) Processes is defined by the following criteria:

  1. Completed Creating the Finished Product → Actual Arbeit → Actual Geld (Arbeit-into-Geld)
  2. Successfully Selling it to the Tournament → Actual Arbeit → Actual Geld (Arbeit-into-Geld)
  3. The Transactional Sales themselves → Actual Geld (Geld-into-Arbeit)

Even in the digital realm, the National Intranet oversees an identical process insofar as the Tournament has its satellite equivalents in the Student Economy (which is overseen by Student Government) and the Digital Economy (which is overseen by the Social Forums).  

National Intranet → Digital Arbeit → LERE Refinery → Digital Geld → Central Bank → Actual Geld

Since Social Media, eCommerce, PCs and smartphones also exist in Scenario 1999, it would not be too difficult to envisage some form of Crowdfunding. The closest equivalent, based on the conclusions from the last three Treatises is the idea of the Council State issuing Stipends, a fixed sum of Actual Geld, to somebody to finance their contributions of “meaningful works of art.”  

State → Stipend + Paygrade → Self

Self + Stipend → Actual Arbeit + Actual Geld → State

The State issues a Stipend and a Paygrade to an eligible Self. The Self spends that Stipend to contribute either a comparable Quality of Arbeit and the Geld or exceeds the State’s expectations with the limited resources at their disposal. If the State can issue Stipends, and assuming that NSFIs (National-Socialized Financial Instruments) are ill-suited, could the Totality fulfill a similar role for the Self?

Remember, the State is providing the Stipend with the Intent that the Self has a Legal Duty to spend that Stipend on their Vocation and not for personal expenses. Yes, the Totality are allowed to purchase the digital media that someone creates and uploads the to the National Intranet. The Self receives their Actual Geld from the transactional sales for the digital media. The Totality should also be able to let the Self develop a particular kind of digital content for as long as the associated media is attached to a relevant Domain within the Work-World. The State Commissariat remains the final authority on that matter, but that is a whole different topic altogether, however.  

I have no idea if anybody realizes this, but there is a fundamental difference between the Self receiving donations from the Totality and Stipends from the State on the National Intranet, and the idea of Crowdfunding on the WWW. This practice once had a name in the Western world and it was called “Almsgiving.” By giving Actual Geld to the Self outside of transactional sales, the Totality is engaging in the act of Almsgiving out of charity and virtue.

Crowdfunding abuses that concept by presupposing that the Council State has no Constitutional Obligations whatsoever of providing a Paygrade to the Self in return for their lifelong service to the Totality. The Totality, since they are incapable of providing the Self any Paygrades, have to constantly provide the Self with unending payments of Geld, not out of charity and virtue, but for the sake of ensuring the Self’s subsistence and well-being.

How does this conclusion apply to me? Whenever I decide to engage in Crowdfunding, always remember that the Intent is to facilitate donations from Readers. The purpose of the donations is to pay for the costs of running and operating The Fourth Estate, such as the website domain and the various features to provide the same Quality of Arbeit for the Readers. The idea of someone “living off the kindness of strangers” is a Failure of Imagination that could have been avoided.

Production for Dasein in the Digital Realm

At the same time, in reference to various issues discussed earlier in Section One, there are untapped opportunities for any nation to apply the State of Total Mobilization I mentioned in Section One that are various ways in which a National Intranet’s Digital Economy and Virtual Economies could serve alongside the VCS Economy and the SSE. Key to this is the concept of the Tournament having the bulk of its operations in the Real World within the VCS Economy whilst maintaining extensions of itself in the SSE (for educational and training purposes) and the National Intranet (to facilitate the LERE Process and the contributions of Digital Arbeit and Digital Geld). The distinct characteristics of the digital realm will eventually enable the SSE, the VCS Economy, the Reciprocal-Reserve Banking System, and the National Intranet to interact with each other. To prevent unnecessary rivalries and petty factionalism, the Council State must assert the Intents of Command and Obedience in the Social Forums.

This means that all the usual facets of Life under the Work-Standard in the Real World should also apply in the digital realm. The Constitution and Legal Code are to be extended to the National Intranet and enforced by the Council State. The Social Forums have their own Superintendents, State Commissars, Inspectors, Central Planners, Economic Planners, and Accountants. If they are not going to be the same people offline, they will at least have their own equivalents operating in the National Intranet as part of the Social Forums. Even the practices and procedures of Council Democracy will also be upheld on the National Intranet.  

The next two Entries will explore Production for Dasein with regard to the economic governance of Economic Organizations. There is no doubt that the characteristics of the National Intranet will warrant different approaches applicable to the LERE Process. What has been said about economic activities involving the LERE Process needs to be comparable to those found among offline Enterprises contributing Arbeit and Geld under the conventional LER Process. This is especially for the anticipated multiplicity of Enterprises that also conduct their economic activities in either the SSE and National Intranet or the VCS Economy and the National Intranet.  

Categories: Digital Realm

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  1. Update (14 April 2023) – The Fourth Estate

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