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Re: <nettime> joxe's empire of disorder (etc)
Kermit Snelson on Fri, 6 Dec 2002 23:21:40 +0100 (CET)

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Re: <nettime> joxe's empire of disorder (etc)

   [i'm re-sending this message because it seems to have gotten waylaid 
    between thing.net and the nettime.org archive -- a victim, maybe, of
    dow using the DMCA to bludgeon verio into blackholing thing.net over
    the dow-chemical.com site. as the excellent mr. bichlbaum noted, that
    reaction was much more aggressive than earlier incidents; so it's all
    the more remarkable to see the passivity with which 'nettimers' met
    the disappearance of nettime and a other such resources. cheers, t]

McKenzie Wark:

> For the same reasons that Ricardo thought of profit as different
> from rent, I distinguish 'margin', the return on intellectual
> property. There is a continuum from rent to profit to margin in
> the extent to which demand stimulates additional productive
> capacity and hence a falling rate of return.

I disagree with Ken here.  Knowledge-based parts of the economy
(aerospace, pharmaceuticals, software, telecoms, etc.) are characterized
by increasing returns on the margin, not by the decreasing returns
characteristic of resource-based industries (agriculture, mining, etc.)
[1].  I believe this presents difficulties for Ken's claim that the
producers of intellectual property can emerge as a revolutionary class on
the same order as workers and peasants.

Neoliberalism depends largely upon this economic fact.  Its theoretical
basis derives primarily from the Austrian school of economics founded by
Carl Menger, the main innovation of which was to treat the capital
structure (the structure of production) as an embodied network or pattern
of evolving knowledge.  In other words, capital of all kinds is nothing
but knowledge embodied in tools and processes.  Any tool, whether a
software package or a hammer, is simply knowledge embodied in matter.  
Moreover, this knowledge is heterogeneous, taking both articulate and
tacit forms. (Michael Polanyi, Karl's libertarian little brother, was a
leading theorist of tacit knowledge in this sense [2].)  The location of
both forms of knowledge can be either personal or intersubjective; the
design of a tool, for instance, may be viewed as the location of tacit,
intersubjective knowledge.

In this view, economic development is identical with continuous innovation
in tools and processes.  Innovation, in turn, is always a social learning
process facilitated by a division of intellectual labor and by positive
feedback networks.  Efficient division of labor is facilitated by private
property rights in information and knowledge; the positive feedback
mechanism is provided by markets in which such property rights are
exchanged.  Both property rights and markets in information and knowledge
are seen as the keys to facilitating the social learning process and thus,
by definition, economic development.  The global establishment of such
rights and markets represents the point at which this economic theory
becomes the legal, political and, more recently, military program known as

If the "social forum people" are having difficulty envisioning a social
alternative to this neoliberalism, I think it's primarily because they
haven't been able to articulate accurately what's wrong with it.  It
obviously hasn't been enough simply to take to the streets and blame all
of the world's problems on the neoliberals.  The neoliberals have replied
that these problems are instead the fault of a few evil and violent
individuals in the world who oppose knowledge and progress on principle,
and that the best way forward is to stop them.  It's pretty clear that the
general public of the "overdeveloped" USA, having seen what happened to
downtown Seattle in 1999 and to Lower Manhattan in 2001, has decided that
the neoliberals are right about that.

What I personally don't like about the neoliberal model is that it implies
the eventual privatization of all existing social information and control
mechanisms, including technology, government, currency and even culture.
All law is being reduced to intellectual property law, based on the
metaphysical premise that all capital is reified knowledge and that all
labor is immaterial or affective.  The result will be the abolition of the
early-modern territorialization of law (namely its situation within the
physical and objective space of extension) and hence the reintroduction of
the earlier tribal or culture-based forms (in other words, its
re-situation within the personal and subjective space of intension.)  
These latter forms, I believe, are capable of supporting only
"underdeveloped" economies, as is obvious from the many parts of the world
in which purely tribal or culture-based structures survive.  I believe
that this deterritorialization of law will result in a step backward for
human freedom and dignity, just as I believe that its territorialization
during the early modern period was a step forward.  It is not coincidental
that a similar revolution occurred simultaneously in science as well as in
law during Europe's early modern period, just as it is not coincidental
that modern scientific method and public law are being dismantled
simultaneously in our own (both through a radical expansion of IP law.)

But of course, all of this is exactly the (academic) Left's program as
well. Malcolm Bull alluded to this coincidence of aims last year in the
_London Review of Books_ with particular reference to Toni Negri [3], and
he's right.  Take, for instance, Negri's concept of "general intellect"
[4] or "social wealth" [5].  It's exactly what the Austrian School chooses
to call "capital."  Negri also speaks, as does the Austrian School, of a
"continuous process of innovation in production" [6], one of Negri's many
unacknowledged borrowings from Georges Sorel's _Reflections on Violence_
[7].  This and other Sorelian ideas may have entered both Negri's and the
neoliberal lexicon through Sorel's disciple Carl Schmitt, who greatly
influenced the Austrian School's famous economist Friedrich von Hayek [8].  
Other Sorel-Schmittian projects on the academic Left include those of
Chantal Mouffe, some of whose followers are currently working explicitly
to reinstate tribal forms of sovereignty utilizing a radically extended
intellectual property framework.

So it's neoliberalism on both sides of the debate these days, each side
accusing the other of statist mass murder and of spiritual poverty.  
Didn't we learn from Schmitt (via Mouffe) that you can't have "the
political" without an enemy?  The only substantive disagreement, however,
seems to be that the Left wants a "general intellect" without the
intellect, and a "knowledge economy" without the knowledge.  This means
that the academic Left will lose.  At least they can console themselves
with the grant money they have successfully solicited from George Soros,
Motorola and Unilever, with their with gigs as featured technology
commentators in _Newsweek_, and with their handsome royalties from the
Harvard University Press.  (Sounds like an idea for a map, Brian!)

Kermit Snelson


[1] Arthur, Brian, _Increasing Returns and Path Dependence
    in the Economy_, Michigan, 1994, passim
[2] Polanyi, Michael, _The Tacit Dimension_, 1966
[3] http://www.lrb.co.uk/v23/n19/bull01_.html
[4] Negri and Hardt, _Empire_, 2000, p.364-5
[5] _ibid._, p.258
[6] _ibid._, p.365
[7] Sorel, _Reflections on Violence_, Cambridge UP, p.244
[8] Scheuerman, Bill, "The Unholy Alliance of Carl Schmitt
    and Friedrich A. Hayek," _Constellations_ 4:2 (October

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