This is a guest post by Matthew Slater, sharing valuable lessons from his personal experience as a developer working with, and for, communities. It was originally published on the author’s personal blog on 17th August 2026, and has been lightly edited here.

In my travels I’ve met many activist software developers like myself, overflowing with energy and idealism for communities in general, but no community in particular. Many of them were creating a new kind of platform that addressed the concerns of the moment – privacy, security, sovereignty, serverless architecture etc. I don’t mean they were collaborating; I mean each was building their own platform. Once the platform was ready they embarked on a quest for users, or, which is harder, whole communities of users ready and able to migrate to the latest platform. After a few years they run out of physical or spiritual resources, and move on. It seemed to me a predictable waste of developer years, but more tragically, a lost opportunity for the communities they wanted to help.

So this post is about software for communities. Here, by community I mean any group of neighbours or idealists coordinating online. Sometimes communities cluster together under the same banner, like time banks or transition towns, and I’m calling that a movement. Movements are interesting because they are comprised of basically independent chapters who need to communicate within and between each other. I’ve written lots more about that on my blog.

Most real-world communities live on Whatsapp. It has a few features, but they go a long way – filesharing, groups, conference calls, reactions, polls. The main advantage of Whatsapp is that everyone already has it installed and they know how to use it. Upgrading to something is hard because it involves getting people to install an app, create accounts, make a separate box in their head for community stuff; so to be worth the pain, any proposed alternative has to promise a lot! That’s why some groups deliberate for years, get nowhere, and then make a poor choice.

The first choice such groups need to make is about how much responsibility they can take for their software, including ongoing costs. I see this as a spectrum ranging from:

• Smaller groups with little or no knowledge should be thinking about paying for Software as a service (SaaS). There are many reasons not to do this, but without technical ability, all you can do is throw money at the problem.

• Groups which have limited technical capacity might consider installing an open source package. This is cheaper because you only pay the cost of renting server space, and there are many opportunities to configure your data or tweak the software. Plus your data remains private.

• Larger groups with more specific needs, more users, more resources, maybe even more software engineers have the possibility of building their own software, and this is a minefield. A professional project has a project manager, documentation, automated testing, and a budget of tens or hundreds of thousands, but at the grassroots, those things are luxuries and the budget may be zero. In that case everything depends on the developer, their rigour, their knowledge and their multi-year commitment. The developer is irreplaceable: if they stop, the software stagnates forever.

So far, I’ve introduced you to the developer who needs a community to validate their software and their existence, and to the community who needs a developer. It’s a tragedy that these partners who are made for each other rarely find each other. It’s a mystery what obstructs their union.

Having spent years in both roles, I’d like to offer my perspectives, and then a solution.

During the Covid lockdown, thousands of street-level mutual aid groups appeared on Whatsapp. They had no formal structure, no subscription fees, no governance, and they withered away as the lockdown eased. Many people experienced community for the first time. They had no idea that Local Exchange Trading Systems (LETS) had been doing just that since the early 90s, and continue to do it now. Indeed, LETS are rarely mentioned in discussions about local community building. But to my mind, these groups are the nearest thing in the Western world to formalised, mutual aid networks. LETS is making a life and an economy out of mutual aid. Thousands of self-organised independent local groups who rarely seek government or grant funding, don’t express ambitions beyond their immediate scope, and consequently rarely appear on the radar.

I converted my wiki into a LETS trading platform but couldn’t get anyone to use it, even after months of working fruitlessly with a national umbrella organisation. I determined to find a community that was willing to work with me on their software to fulfil my dream of writing software that was actually used! I was lucky to catch my local group in Geneva at the right moment. I built a super platform, and then, with the Chairman, founded Community Forge as a Swiss association, and we approached other groups in the network. While they offered me long periods of hospitality, I put together a hosting platform to manage lots of sites. They found people to offer technical support and the network grew to around 300 communities at its peak. It wasn’t the quality of the software that drew them, so much as the fact that we came from within the network, we had their values, and the software at least worked! To this day we have never done marketing or tried to impress the public which is why the public facing website is such a mess!

For several years I was keeping the software up to date, sustaining the hosting platform, and nomading – meeting other people in the movement, offering this great platform already used by hundreds of groups. Several individual groups adopted the free services I offered, but, critically for this story, over a decade I was unable to convince any other movement to use the platform and put resources into it. My only real success therefore, as an activist/developer, was when I worked inside a movement.

I wanted Community Forge to be the seed of a software commons that would reduce the cost of software for any one network, bring the development and maintenance inside the movement, and build standards and tools for interoperability, especially for trade and exchange! But this progressive, outward-looking, collaborative approach simply didn’t land. The LETS networks in the UK, Netherlands, Flemish Belgium, the German-speaking regions, Australia, and New Zealand all looked inward for their software. Timebank networks had more money. I hung out with leaders in the UK, the USA, Israel and Spain. Some of them had tens or hundreds of thousands budgets, but they usually ended up hiring web design companies to design and build them a website, from scratch. Sorry to say I wasn’t impressed with the results, but that’s a rant for another time!

The point is, because I wasn’t just meeting these people at conferences but actually visiting them at their homes and in their communities, I came to understand how these kinds of groups and organisations make critical decisions.

Many grassroots groups depend absolutely on a single IT volunteer, and their abilities and knowledge. Many of them have zero budget. Many of them are not being begged by their comrades to improve software. Many have become conservative by having had bad experiences in the past.

It is easy for web developers to forget that flesh-and-blood communities regard software as an auxiliary, not as an intermediary and not as critical infrastructure. They might not be alive to the boons good software can bestow, but they intuitively understand that installing a new social network alongside all their other bits and pieces is going to create another silo which will add more friction and overhead to their existing infrastructure. A new login for everyone, new communication channels in which to lose things, issues around duplicate files and versioning problems, synchronisation problems. Migrations can be especially traumatic because they never go as planned, and all the extra work falls on one person.

More than once I’ve been asked (as co-founder, and sole developer of Community Forge) if any of the communities we serve would like to test someone else’s software for them. Someone, in fact, who built the software for nobody in particular. Sorry if I sound jealous, but the idea is laughable. Many of those groups have actively participated in the development and the story of our software package Hamlets; they want all the features they are used to, they have nothing to gain from testing software which wasn’t made for them. How can the new software be better than the old if the provider hasn’t even asked me what it does? Is there a budget for a one-off migration, and possible migration back? Don’t they care that we are 12 years into the current upgrade, and 5 years beyond the deadline? The quality or the narrative of a software package doesn’t really come into the equation because we only have capacity to move incrementally from where we are.

We are not being held back because we are unable to locate existing platforms that meet our needs. We are being held back because we lack in-house development capacity.

In my continued attempts to produce software that would serve humanity (and my ego), I decided to distill my accounting methodology into a protocol that could be used in any social networking context. Thus was born the Credit Commons Protocol for recursive mutual credit accounting. Working in the abstract, unencumbered by technical debt and real users, building a perfect machine in my mind was a lot of fun for me. But ‘more abstract’ was also harder to explain, and further from anybody’s immediate concerns. It was so theoretically advanced I couldn’t even interest the International Reciprocal Trade Association with it [the main association of professional barter exchanges, or business-oriented mutual credit networks], and I confess that the regular LETS and timebanks people – even if they thought accounting-as-a-service between groups was a neat idea, even if it meant they had less software to maintain – didn’t mention it to their developers.

So I learned the same lesson even harder – building software that nobody is asking for is (almost certainly) a waste of time. The LETS movement, and many other radical grassroots organisations grounded in place and community and family, are not spending much time thinking about global infrastructure for a global uprising. Perhaps it is right that 90% of their attention should go on local and internal preoccupations. These small and emerging groups need less bright ideas and more engineers on the inside. They need heroes who will work hard for little or no money, who will stick around for many years and keep the infrastructure standing. That’s not going to change.

What needs to change, therefore, is the developers, who are writing software for nobody in particular. I’m speaking first of all to myself because everything I ever built for no-one in particular is being used by no-one in particular. Much of what I built for real groups with real needs is still serving them 15 years later. If we want to be of service, we need to step out of the blissful platonic space of perfect software architecture unencumbered by users and migration, find a cause or a local group, roll up our sleeves, and start putting out dumpster fires and tackling technical debt.

Only then will we be in a position to help build the new systems.

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Afterword

While writing this I noticed a correlation. I voiced my frustration at these inward-looking local communities who fail to engage with my global vision, but I also admired them for their resilience, independence, and longevity.

While LETS seem to have fallen by the wayside a couple of decades ago, nothing has replaced them. The word community now refers to the teenagers with outrageous web handles who cluster around a memecoin [a type of speculative cryptocurrency], conniving to make the number go up. Compared to this and most other communities being talked about, the LETS are still next-level because they have formal structure, staying power and what they permanently facilitate – exchange – is the very foundation of what it means to be social.

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This is the fourth article in an 8-part series based on an essay by Ronan Murphy. The global economy runs on a simple logic. States must grow or be outcompeted, and those that fall behind lose their security. In a system where power still flows, ultimately, from the barrel of a gun, Ronan explores what this means for anyone hoping to build something different.

Part 1 (with a list of articles in the series) can be found here.

The old dilemma of “guns or butter” takes on new complexity in a post-growth context. In a world transitioning away from endless growth, the hope would be to drastically scale back militarism and invest in human and ecological well-being. After all, armies are themselves huge drivers of ecological ruin. The US military, for example, is one of history’s largest carbon polluters, emitting more greenhouse gases than many entire countries.

A key tenet of a post-growth vision is that true security comes not from arms, but from meeting people’s basic needs and protecting planetary life-support systems.

“What we urgently need now is a rethinking of the entire concept of security... The overriding goal must be human security, providing food, water, and a safe environment, not just military terms” - Mikhail Gorbachev.

A sustainable society would thus prioritise feeding and sheltering its people over building tanks and jets. But what happens when other actors refuse to beat their swords into ploughshares? What if some great powers remain expansionist, heavily armed, and growth-obsessed? As climate breakdown intensifies, we see tit-for-tat geopolitical rivalries take centre stage. Major powers like the United States, China, and Russia are doubling down on military might and resource competition.

The European Union, often considered a champion of sustainability, has, not entirely unreasonably, responded to Russia’s invasion of Ukraine and the US’ recent withdrawal of aid (and even hostility) by ramping up military spending and aid itself to shore up its defences. Even more recently, we see new imperialism taking shape via the US’ actions in Venezuela and Iran, with an invasion of Taiwan by China also on the table in the near future.

In such a context, any community that unilaterally disarms or significantly diverts resources to social welfare may, with reason, worry about appearing weak. The powers who cling to growth also maintain the strongest militaries, and their rivalry pressures others to do the same, siphoning funds from green investment to defence budgets and propping up the status quo.

How can a post-growth enclave, or even network, survive, let alone thrive, if faced with a predatory neighbour? Must it keep a standing army, and if so, can that ever be ecologically sustainable? Or is there a path to non-provocative defence, where military capacity is minimal and purely for deterrence? These are challenging questions with no easy answers. What is clear is that security and survival cannot be taken for granted during a post-growth transition.

History offers precedent for how competing powers can be forced towards cooperative governance when the costs of competition become unbearable. The Danube river, Europe’s second longest, drains a basin of approximately 817,000 square kilometres across 18 countries. In the 19th century, the Ottoman, Russian and Habsburg Empires pursued competing interests over Danube navigation, turning the river into an artery of imperial rivalry (1).

The anti-Russian alliance in the Crimean War of 1853 to 1856 aimed in part to break Russia’s exclusive control over the Maritime Danube. The allied victory led to the Treaty of Paris in 1856, which declared the Danube-Black Sea Delta free and open to commercial vessels of all nations and laid the foundations for the Danube Commission, one of the oldest international organisations (2).

All signatories agreed that internationalisation was the proper solution for the nations living along its banks.

The Danube case is instructive because it did not require the parties to become allies, or to share an ideology, or even to trust one another. It required only that the attritional costs of competition, the trade disruption, the military expenditure, the cascading instability, become high enough to make cooperative governance the rational choice.

This is a precedent for defence through interdependence rather than domination. The stronger the material ties between communities, the more costly it becomes for any single actor to attack one node without damaging the whole network. This has echoes in the formation of the European Coal and Steel Community, which was set up after World War II primarily to make it impossible for one country to gather the resources for war without others knowing.

Some thinkers in the degrowth movement have begun to confront the security question more directly. Alexander Dunlap, for instance, criticises degrowth advocates for neglecting the need for “combative self-defence” against the forces of growth and capital (3). He argues that a diversity of tactics, including direct action and community defence, may be necessary to protect both people and ecosystems from aggressive exploitation.

In practical terms, post-growth regions might need to develop forms of civilian-based defence and resilience. Networks of local militias or civil defence units (much like Rojava’s own community defence forces) that can deter invasion or sabotage without building the kind of massive, high-tech military that requires an endless economic churn.

Simultaneously, a post-growth society must wage peace on the ideological front. Challenging the narratives used to justify militarism (for example, that military expansion is “good for jobs” or that “glory” comes from dominance). Redirecting the talents of the arms industry towards renewable energy and infrastructure for resilience is one way to transition the guns workforce to butter without mass unemployment. Ultimately, the goal is a world where this is an obsolete dichotomy.

Achieving this in the context of our existing political institutions is daunting, and maybe even impossible in the time we have left to meet any of our global decarbonisation commitments.

Notes

1. Hardi, T. (2012). Danube Developments against the Backdrop of History and Geopolitics. Der Donauraum, 52. See also Ardeleanu, C. (2020). The European Commission of the Danube, 1856-1948: An Experiment in International Administration, Balkan Studies Library, Volume 27. Leiden: Brill.

2. Gyurcsík, I. (ed.) (2019). Danube Commission 70. Budapest: Institute for Foreign Affairs and Trade.

3. Dunlap, A. (2020). Recognizing the “De” in Degrowth. Undisciplined Environments, 2 December.

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‘Real lobbying reform must end the practice of corporate lobbyists writing our laws.’ - Marty Meehan

This is one of a series of articles that I hope to compile into a book – working title, The Commoners’ Manifesto: Neither Capitalism nor Communism. Here’s an introduction to the series. Comments welcome, including disagreement and debate.

I’ve argued that anti-capitalists should reject state communism as the route to a post-capitalist world, and that community-based, commons solutions are more likely to succeed. In fact I’m arguing that corporations have captured and now control the states that created them, so that a post-capitalist world can’t be built via a ‘democratic’ state either.

I looked at how states and corporations have been united since the birth of corporations, and how corporations set the agenda and lay the groundwork for getting politicians to implement the policies that benefit them. This article is about how corporations add more pressure to get what they want, via pestering and manipulation. Next I’ll look at bribery, money and the ‘revolving’ door, and then at threats and punishment.

I want to argue that corporate dominance wouldn’t be possible without states, and that their dominance has allowed them to capture and control the states that created them. Later posts will look at how states respond to this pressure to ensure that corporations retain their size and power.

Introduction

Here’s how corporations add pressure on governments with a range of techniques, in ascending order of nastiness:

• Pestering (lobbying)

• Manipulation (regulatory capture)

• Bribery (with money and jobs)

• Threats (of capital flight, investor strike, the wrath of global institutions, credit rating agency downgrades, or violence)

• Punishment (actually doing those things)

Now, we’ve all done a bit of pestering and manipulation, and maybe even had a go at mild bribery or threats, but can we all agree that bribing elected officials or using violence against opponents shouldn’t be tolerated? It’s only because we’re so familiar with these techniques in the political world that we don’t see them as too bad. Just like witch-burning back in the day, we become accustomed to terrible things. Outsiders would be horrified, but it just washes over us. That’s why I want to label these things for what they are. Apart from the violence, they’re not breaking the law when they do any of this; it’s all perfectly legal, which isn’t surprising once you understand how corporations have captured the legislative process. From a corporate perspective, these aren’t bugs in corporate capitalism – they’re features.

Pestering: the lobby industry

Lobbying is the attempt to influence government decisions on behalf of particular interests. Lobby firms can be large in their own right – Ballard Partners, for example, has an annual revenue of over $80 million – but are tiny compared to their corporate clients, and aren’t household names. Their value is in their employees, who have close connections to politicians. In fact they’re often former senior government officials and political insiders themselves. Lobbyists can represent trade unions, NGOs or citizens’ groups too, but corporations and their collective organisations make up the vast majority of lobbying clients and spending.

The line between the lobby industry and think tanks is often blurry, and they frequently overlap. But they’re different, in that think tanks generate the policy ideas and produce research to support them, while lobbyists use their connections and direct communication with lawmakers to try to get those ideas adopted, or to suppress ideas their clients don’t want. They usually have specific, tangible outcomes in mind. Industry lobbyists regularly remove or weaken regulatory provisions that would harm corporate profits.

Their three main activities are:

1. Direct communication with legislators, their staff, and other government employees to advocate for or against specific legislation, providing detailed data, analysis, and arguments to try to change policymakers’ position on an issue.

2. Funnelling campaign funds from their clients to politicians that can buy access and create relationships – intended to gain influence.

3. Mobilising public support and building broad coalitions with other organisations, which creates political pressure that’s hard for policymakers to ignore.

They can also:

• Testify at legislative hearings to present their clients’ position.

• Second staff to politicians’ offices at their own cost.

• Organise client roundtables, putting clients in rooms with lawmakers to shape policy.

• Offer politicians jobs when they leave office (see ‘The revolving door’).

• Write policy documents that politicians can adopt verbatim. Here’s just one (egregious) example: just 3 years after the 2008 financial crash, in which derivatives trading played a major part, Citigroup’s lobbyists wrote a draft bill to weaken new regulations around derivatives trading. Of the 85 lines in the bill adopted by the House Financial Services Committee, 70 of them were lifted verbatim from the lobbyists’ draft. This bill was eventually passed by attaching it to a must-pass government funding bill in 2014, bypassing the usual legislative process.

How big / influential is the lobby industry? Companies spend over $4 billion annually on lobbying in the US, around £2 billion in the UK. There are many times more lobbyists than there are politicians. In the US, the financial services industry alone employs 3000 lobbyists – 5 for every congressperson. Research on one campaign showed that for every dollar spent, corporations received $220 back in tax savings. That’s some investment – a 21,900% return, in fact. And it’s not just national politicians who are lobbied. The EU is lobbied relentlessly too.

UK corporations are not required to declare their engagement on policies, how much they spend on lobbying, or which legislation they are targeting. And, if this wasn’t enough, there’s undercover, secret lobbying too, known by insiders as ‘stealth lobbying’ (not that it’s easy to collect data on lobbying generally).

I find it amusing (although painful) that a lot of good people on the left and right propose that the way to stop all of this is for lobbied, captured governments to reform the system by passing legislation. Isn’t the absurd irony of that obvious? Lobbying regulation isn’t fit for purpose, but it’s not the opaque nature of corporate lobbying or lack of regulation that’s the problem. It would still be wrong if it were completely transparent and well-regulated.

Putting a case to your elected representatives is not a problem in itself. It’s the money and power of corporations behind the lobbying that’s problematic and that corrupts democracy. In a different system, say a commons ‘partner state’ (more in later articles), based ultimately on local assemblies, lobbyists wouldn’t have direct access to policymakers (but could still try to influence the choice of experts to present to the assembly). But without professional politicians, and with the composition of assemblies constantly changing, they wouldn’t really have anyone to approach with job offers or wads of cash, and there would be no political campaigning for votes. The answer isn’t to attempt to make corporate influence cleaner, more transparent or more tightly regulated. It’s to make concentrated corporate power politically ineffective.

In a section on lobbying I really can’t leave out ALEC, in the US, although it’s much more than a lobby organisation. It has corporate members that sit on its task forces to draft model pro-corporate bills that it distributes to states and asks them to modify and adopt. It calls itself nonpartisan, but in reality it’s a corporate tool, as explained by the Center for Media and Democracy. It’s also involved in moves to re-write the US constitution to make it more pro-corporate.

Manipulation: regulatory capture

Regulatory capture is a scenario in which a government agency that’s supposed to regulate an industry ends up acting in the interests of that industry rather than in the public interest. Most rules around business and daily life are developed by regulators and public authorities rather than directly by elected representatives. For corporations, influencing these officials is often more practical and effective than focusing solely on politicians.

The term was first popularised by economist George Stigler. He developed the theory partly from his analysis of the Interstate Commerce Commission, the US agency established to regulate US railroads. He argued that, over time, it came to serve the interests of the railroad companies rather than the public. Stigler’s work in the 1970s helped establish regulatory capture as an important concept in the economics of regulation.

Its mechanisms are the same as at the state level, just aimed at government agencies rather than politicians. For example:

1. Lobbying: corporations advocate for the rules that benefit them. Unlike legislative lobbyists (see above) who must register (under the Lobbying Disclosure Act in the US, and the Lobbying Act in the UK), those who target regulatory agencies are often not required to register. This allows their campaigns to operate under the radar. In the US, twice as much is spent on lobbying regulators than lobbying politicians.

2. The revolving door: regulators leave to work for the industries they regulated, or industry executives become regulators. More on the revolving door in the next article.

3. Shared cultures and social connections of regulators and regulated: similar backgrounds and frequent interactions between regulators and industry can make regulators more sympathetic to industry concerns.

4. Structural dependence: for a regulatory agency to do its job, it needs immense amounts of data and expertise about the industry it oversees. The only practical source for this is the industry itself. Regulators often have no choice but to rely on unverifiable data and self-reporting from the corporations themselves. In many cases, independent sources of data just don’t exist.

Corporate capture of regulators doesn’t necessarily mean weaker or fewer regulations. Often capture leads to more or stronger regulation, but designed in ways that benefit corporations that can afford compliance costs, lawyers, reporting requirements, certification systems etc. Small competitors often can’t, so regulation can become a barrier to entry into the market for small businesses.

Wikipedia has a large list of historical examples of regulatory capture, so I don’t need to list more here. But I would like to recommend the movie Inside Job, about the 2008 financial crash, because it’s so entertaining (watch it for free here). Icelandic regulators were interviewed about their contacts with privatised banks holding assets around ten times the size of the Icelandic economy, lending money for schemes, many of which went bad, and lots of people lost all their savings. They said that when they visited banks, 20 lawyers were waiting to greet 2 regulators, primed to answer their questions. The regulators who pushed hard were offered jobs. One third of Icelandic regulators accepted.

Because of their shared culture, regulators aren’t conditioned to question ‘normal’ corporate behaviour, only obvious corruption. What I’m arguing is that perfectly legal corporate attempts to gain influence are extremely detrimental to democracy, nature and society.

Regulators accept the fundamental structure of large corporations and a market dominated by such entities as the baseline reality that they’re there to manage, not to challenge. These assumptions are rarely questioned. Their reforms are therefore geared towards enabling corporations to function on as even a keel as possible. Their goal becomes mainly stability, which often involves suppressing smaller, more efficient, decentralised alternatives that might disrupt the status quo.

As and when the commons grows to challenge corporations, regulators may well see this as problematic and regulate against it, as it’s in direct opposition to everything they’ve learnt about how an economy should operate – i.e. growth, oligopoly and wealth concentration.

Conclusion

I looked at how states and corporations have been united since the birth of corporations, and how corporations set the agenda and lay the groundwork for getting politicians to implement the policies that benefit them. Now I’m looking at how corporations add more pressure to get what they want. Above, I looked at pestering (lobbying) and manipulation (regulatory capture). Next I’ll look at bribery, money and jobs ‘the revolving door’, and then at threats and punishment. After that I’ll move on to what corporations get in return from their partner states.

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By Amrit Sachar and Louise Romain, Festival Organisers

When we last wrote about the Festival of Commoning in July, the programme was still taking shape. It has now been published, and I am excited to give you a glimpse of what our programme team has created, with 17 contributors and 8 venues.

In the two days of programme, this year’s theme ‘Common Ground: Healing Divides’ will take you through innovative, grassroots projects from around the world, exploring neighbourhood organising, cooperative economies, land, food, energy, housing, democracy and governance.

Tickets now on sale here

£99 for standard ticket

£150 for pay-it-forward

Solidarity pricing: £25 for supported tickets

Different ways of participating through multiple venues

The Festival has been deliberately organised to invite people to participate in a variety of ways, engaging their minds, hearts and hands.

Head

• At Lansdown Hall, the programme will be the closest to a conventional conference format, with talks, presentations and conversations exploring larger questions around commoning. These sessions will be video-recorded and made available for free, online after the Festival. Lansdown Hall has limited capacity (150 people).

Heart

• At St Laurence Church, sessions are more immersive, experiential and interactive, with greater emphasis on participation and discussion. There is no capacity limitation here but these sessions will not be recorded.

Hands-on

• These sessions are field trips and practical experiences, visiting projects, meeting the people involved and learning through doing.

  • On Friday afternoon, visit Stroud Common’s brand new Climbing Commons: a community bouldering facility at half the price of conventional facilities. Hear Chik Shimasaki tell the story of how we turned it from an idea into a reality, and how the project was developed using the Stroud Commons finance model. He will answer all your questions and you’ll get a go at climbing too! Spaces limited, booking advised.

  • On Saturday morning, a joint session held by Common Soil and Landmatch England will explore Commoning Land through practical experience. Get your hands in the soil and explore big questions together: Can (re)-commoning our food system address the meta-crises?

  • On Saturday afternoon, the Trinity Rooms Community Kitchen will host Cooking for Community. Come help make a meal for 100+ festival contributors and participants, and learn what it takes to run a successful community cafe and to create hearty, healthy meals for hundreds of people. Spaces limited, booking advised.

Come to these sessions:

Neighbourhoods and community organising

• Transforming Neighbourhoods: Meet two grassroots groups: East Marsh United, from Grimsby, and Positive Carrickfergus, a Northern Irish Community Interest Company. They are transforming their neighbourhoods addressing the issues that matter to their communities most: from a community-owned greengrocer to community-led housing – sprinkled with art and music events that make a place a truly great place to live.

• From the Ground Up: In this interactive session, we will hear from Jaqui and Lou of Paganhill Community Hub, a community hub based at The Octagon in Stroud. Following a short film, they will share their experiences of building community, supporting local people, and applying asset-based community development principles that focus on people’s strengths, skills and relationships.

• Assembly Culture: Finding common ground in a polarised world: ​Join the Humanity Project to hear how neighbourhood assemblies help communities across the UK build trust, share power and drive change together by finding common ground in times of polarisation. Through listening, deliberating, and storytelling, neighbours rediscover their collective agency.

• Cooperative Networks: Join members of Cecosesola, Venezuela’s pioneering cooperative network, for a session featuring a short pre-recorded presentation followed by a live Q&A. Discover how their non-hierarchical, community-led approach has built resilience, provided affordable essential services, and adapted to decades of economic and social challenges.

Energy and economic infrastructure

• Community energy: Taking control of our renewable abundance: Who owns our energy? And who currently profits? Join Flick Monk (Platform), Jess Farr (Stroud Area Community Energy Network ) and Iris Partridge (ResNet) to explore how the community energy movement is putting communities in control of our renewable resources, why that’s good for people and our planet, and how you can join the radical movement of energy commoning.

• Finance and economic commons: A new commons movement is developing, with new and revamped financial and economic tools, that can federate and form the basis of a new economy, owned by communities, rather than by banks and corporations. Dave Darby from Stroud Commons will explain the basic ideas, and their inventors will be present to answer questions.

Conflict resolution and decision-making

• Rehearsing the Future: Community Imagining as Practice. A deep dive into creative participation methodologies from Town Anywhere, a large scale time travel community visioning process. Ruth Ben Tovim will share about the conditions that enable people to come together across differences, work and make decisions collectively, and build trust, agency and a sense of belonging quickly. Imagination is an essential social skill for bridging divides and navigating uncertain futures.

• Conflict, Collaboration & Collective Power: Joining together for the common good. Conflict can divide us at every level, from difficulties with those we work or live beside, all the way up to huge social and political tensions. It can also offer a path of joining together to become something more than we can be alone. Run by Paul Kahawatte at Navigate, this session will look at some practical ways we can prepare for and engage with tensions, disagreements and difficulties, in order to work together, more powerfully, for a better future. Spaces limited, booking advised.

In addition to all this, we also have a session hosted by the Heavens Valley Community Benefit Society on ‘Tending our Common Land’, an evening celebration organised by Black Ark Media at the Stroud Brewery. Make sure to check out the programme for further details!

We have worked hard to create solidarity ticket prices from £25 for supported tickets, to £99 for standard tickets, and £150 for pay-it-forward tickets. We would be grateful if you’re able to buy your tickets in advance: Tickets are on sale here.

If you need accommodation, have a look here which includes the option to pitch a tent, roll out a sleeping bag in Trinity Rooms and cheap rooms in Hill House.

The Festival is built collaboratively by people who care about creating welcoming, inclusive and community-led spaces. We need the participation of many hands to make this a fantastic, smooth and well organised experience for all. If you’ve got time over the 2nd and 3rd of October, and in the weeks leading up to it, please consider applying to be a volunteer. Fill in the volunteering form or email festivalofcommoningstroud@gmail.com.

Thank you for reading!

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Contents

1. Think tanks

2. Corporate infiltration of education

3. Ownership of mass media

4. Astroturfing

5. Social connections and shared values

6. Conclusion
   

‘We can have democracy or we can have great wealth concentrated in the hands of the few. We cannot have both’ – US Supreme Court Justice Louis Brandeis (1933)

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This is one of a series of 24 articles that I hope to compile into a book – working title, The Commoners’ Manifesto: Neither Capitalism nor Communism. Here’s an introduction to the series. Comments welcome, including disagreement and debate.

In the previous article I showed how states were involved (and essential) in the formation of corporations, and how they’ve been entwined ever since.

This article covers the various ways that corporations set the political agenda, including what is and isn’t thinkable (i.e. what’s in the ‘Overton Window’). The next is about the more aggressive ways in which corporations have captured states.

I want to argue that corporate dominance wouldn’t be possible without states, and that their dominance has allowed them to capture and control the states that created them. But first, let’s look at the tools and strategies that corporations use to set the agenda and control what can and can’t be discussed.

Think tanks

A think tank is an organisation that conducts research and provides advice, with the aim of influencing policy. In the UK, ‘Tufton Street’ is a term used to describe the ecosystem of right-wing think tanks centred on said street, on Parliament’s doorstep. Examples include:

• The Institute of Economic Affairs (IEA)

• The Adam Smith Institute

• The Taxpayers’ Alliance

• The Global Warming Policy Foundation (GWPF)

• Civitas

• Policy Exchange

• The Centre for Policy Studies

There are also global, corporate-funded, highly-influential think tanks like the Council on Foreign Relations; and some don’t call themselves think tanks at all, like the Pacific Legal Foundation in the US, which exists to defend corporations against environmental, health and workers’ rights activism. Many call themselves ‘free-market’ think tanks, but I argue that if they’re promoting corporate interests, then they’re nothing of the sort.

Think tanks are infamous because of the way they translate corporate interests into policies that help subservient politicians gain office. I’ve underestimated their influence in the past, but I was wrong, which is why I’ve listed them first here. We now have right-wing activists boasting that the IEA ‘incubated’ a British prime minister.

This is how think tanks operate:

1. Corporations and billionaires fund them and give them their agenda.

2. They combine public opinion and corporate agendas to deliver voter-friendly policies.

3. Corporate media promote their policies and influence the public.

4. Political parties adopt the policies because they know they’re voter-friendly.

5. Just to be sure, politicians appoint think tank staff as special advisors.

6. The politicians get elected and implement corporate-friendly policies.

Here’s more detail on those steps:

1. Corporations and billionaires fund them and give them their agenda

Most critics focus on ‘Dark Money’ – political spending meant to influence elections or public opinion, where the original source of the funds is hidden from the public. Because the donor’s identity is shielded, wealthy individuals, corporations, or even foreign entities can spend large sums of money to influence politics without public accountability.

But I’d argue that it doesn’t matter if the source of funding is opaque or transparent – it’s still a vehicle for corporations to get their way.

See Who Funds You for how transparent think tanks are about where they get their funding. More here.

2. They combine public opinion and corporate agendas to deliver voter-friendly policies

Think tanks conduct research to understand the public mood, build a case for their agenda, and ultimately give politicians the confidence to act. They don’t have to push for policies that benefit particular corporations – just for policies that create and maintain a corporate-friendly environment. Conclusions of studies and drafts are often discussed with donors, whose opinions help shape the final report.

3. Corporate media promote their policies and influence the public

If public opinion doesn’t match the corporate agenda, corporate media, including social media, are used to tweak public opinion, helping shift the Overton Window towards their preferred policies. Think tank staff are interviewed in the media, including, of course, the state broadcaster in the UK, and presented as if they’re impartial. News outlets constantly use them as sources of information in articles and editorials.

It’s a very cosy relationship, as revealed by the head of the Adam Smith Institute: ‘Every Saturday, in a wine bar in Leicester Square, staff from the Adam Smith Institute and the Institute of Economic Affairs would sit down with Conservative researchers and leader writers and columnists from the Times and Telegraph to plan “strategy for the week ahead” and “co-ordinate our activities to make us more effective collectively”. The Daily Mail weighed in to help the lobbyists refine their arguments and ensure there was a supportive article on its leader page every time they published a report.’

4. Political parties adopt them because they know they’re voter-friendly

Think tanks that deliver policies that please corporate donors (securing fundraising) and can be sold to the public as popular (securing votes) gives politicians a ‘win-win’. For example, a tax cut for an industry becomes ‘job creation’, and a deregulation bill becomes ‘cutting red tape to lower prices’. When a politician cites a think tank study, they’re not admitting to helping a donor; they’re claiming to be following expert evidence.

Because think tanks have already done the research, written the policy papers, drafted the legal language and tested the public messaging, adopting the policy requires almost zero effort from the politician’s staff. When a bill is that easy to pass, raises that much money and pleases that many voters, saying ‘no’ becomes a politically risky choice. Politicians aren’t being duped. They’re fully aware of the game. They willingly adopt these policies because the system has aligned their survival instincts perfectly with corporate interests.

5. Just to be sure, politicians appoint think tank staff as special advisors

This is extremely common. George Monbiot used Liz Truss as an example. Her chief economic adviser, Matthew Sinclair, was formerly chief executive of the Taxpayers’ Alliance; her interim press secretary, Alex Wild, was research director at the same organisation; her health advisor, Caroline Elsom, was senior researcher at the Centre for Policy Studies; her political secretary, Sophie Jarvis, was head of government affairs at the Adam Smith Institute. More examples in the FT and UCL about this.

6. Sure enough, the policies are voter-friendly, so they get elected and implement them

And they throw in a few more corporate-friendly policies too, like making corporate donations to think tanks tax-exempt if they’re registered charities, as many are (e.g. the IEA), but I guess it’s allowing the IEA to be registered as an unbiased ‘educational’ charity that’s the problem here. Corporations can then write off their donations to think tanks as charitable contributions on their taxes. And of course they make sure that there’s no legal requirement for think tanks to reveal their funders.

Corporate infiltration of education

The various ways that corporations influence state policies, as outlined in this article, also apply to the education system. States comply in shaping curricula and rules so that kids are compelled to wear a uniform, turn up on time, do as they’re told and accept the status quo. That way, it can be ensured that the education system produces passive consumers and reliable corporate employees who won’t rock the boat.

There are more direct ways that corporations infiltrate education. Funding is the obvious one. Corporate funding of university departments helps tailor research for corporate profit (or worse: militarisation and corporate profit) rather than the public good, and to shape student opinion and what’s seen as ‘common sense’. See here and here, and there are many more that you can easily find.

In the UK, universities are ranked according to what percentage of their graduates are in professional and corporate managerial positions with high salaries one year after graduating – amplifying the idea that the purpose of the education system is to produce successful capitalists. We’ll look at the ‘revolving door’ between corporate and state employment (including academia) soon.

It happens outside higher education too. Corporations provide education packages for schools on their topics of interest – for example, analysing NAFTA – but the materials provided will be pro-NAFTA. Packages contain some good stuff, maybe on recycling or fuel efficiency, but never any discussion of how an excellent public transit system might be better than over-reliance on the private car. The materials will probably be accurate, but biased; a prime example is the financial literacy programme provided by the Council for Economic Education, that is ‘primarily focused on measuring students’ grasp of neoclassical economics’. No wonder: have a look at their funders.

Packages often contain corporate advertising aimed at children. Corporations provide equipment for the school, but only if the school makes sure the kids watch the advertising – during lessons! They also pressure schools to install vending machines full of unhealthy fizzy drinks and sweets. See it in action in this policy for Chicago schools.

Ownership of mass media

As with most sectors of the economy, ownership of media outlets is becoming concentrated in a few mega-corporations, and radical alternatives to corporate control get almost no coverage in that media, for reasons that should be obvious. Apart from the fact that mainstream media is owned by corporations, it’s also funded by corporate advertising, and of course they’re not going to publish content that’s inimical to their own and their advertisers’ interests.

Specific corporations often fund sponsored content in the mainstream press to push on a particular issue that’s important to them, but mainly, it’s about shaping public opinion on what’s ‘common sense’, generally.

But ignoring alternatives is just the first stage. As Gandhi (maybe) said, ‘first they ignore you, then they laugh at you, then they attack you, then you win’. In that case, when the corporate media is attacking commons, we’ll hopefully be well on the way to winning (we can but hope).

Jeremy Corbyn (ex-leader of UK Labour Party) knows about the media’s attack phase. This was the only genuinely anti-corporate potential prime minister in my lifetime, with a lifelong commitment to anti-racism, and yet even some of my right-on friends believed the corporate and zionist lobbies’ BS about his purported antisemitism. Zack Polanski (Green Party leader for England & Wales) will receive similar treatment, although at least they won’t be able to use the antisemitism approach with him (as he’s Jewish).

This corporate stranglehold had a counterweight: the arrival of social media meant that independent journalists, grassroots organisers, dissident economists and the rest of us heretics could bypass the big boys, reaching audiences that sometimes rivalled mainstream media. That window is now closing, if not already shut. The platforms – themselves corporations funded by the same advertising oligopolies – have transitioned from ‘open town squares’ to algorithmic gatekeepers. Their censorship isn’t about overt bans (although that happens); it’s about shadow suppression: demoting posts with ‘unverified’ corporate-critical content, reducing reach for anti-capitalist hashtags, and demonetising creators who deviate from corporate orthodoxy. On the same day, a misleading pro-corporate post about tax cuts might stay up, while a factual post about a case of corporate price-gouging is flagged as ‘misinformation’ because an advertiser complained. Worse, platforms outsource content moderation to AI and third-party contractors with no political accountability, causing activists to self-censor to avoid penalties. The result is that radical alternatives are algorithmically buried before they can even reach the ‘laughing’ phase. The corporate media doesn’t need to attack what 95% of users never see.

Newspapers and private TV stations will pull stories with a negative slant on the corporate sector (although they’ll often expose individual corporations), and push stories that give a positive slant to the worldview of corporate advertisers, because their livelihood depends on it. Chomsky and Herman’s propaganda model describes how the business model of the corporate media is not delivering news to the public, but delivering the public to advertisers.

Researching and understanding political issues today is expensive in terms of time and energy. Most people generally can’t afford this time and energy (especially if they’re working more than one job to make ends meet), and so can easily be swayed by ads designed by consultants with lots of time, energy and resources. It becomes just another consumer choice and habit – choosing political parties the way we choose breakfast cereals. And sure enough, data shows that politicians attach virtually no weight to the views of people with low (or even middle) incomes.

Electable parties in the West have become brands, with policies that are generally socially progressive and economically neoliberal. This is in the interests of corporate investors. Socially progressive policies have no impact on their profits, but veering away from neoliberal economic policies does. It’s all about return on investment in the end. If $x investment helps deliver legislation that makes you $2x, that’s just good business sense in a corporate world.

Astroturfing

This one seems somehow sneakier and nastier than the other approaches, but it isn’t really – it’s just less subtle. Astroturfing is a play on the word grassroots. It’s a plastic, pretend, sterile, corporate version of grassroots activism and opinion, in the same way that Astroturf is a plastic, pretend, sterile, corporate version of grass.

The aim is to manipulate the public into believing that there’s mainstream support for proposals, ideas or candidates, when in fact, the support is manufactured. The intention is to affect public opinion, voting intention and therefore government policy. This is done in various ways:

1. Paying people to write pro-corporate letters to the press.

2. Planting paid corporate stooges in public meetings, posing as concerned citizens.

3. Hiring freelance gig-workers (usually in poor countries) to like, dislike and share posts to support or oppose specific policies or opinions on social media.

4. Releasing swarms of bots / automated accounts to do the same thing.

5. Creating fake social media accounts (‘sockpuppets’) to post on behalf of corporate campaigns.

6. Flooding politicians’ phones and inboxes with manufactured outrage.

7. Founding and funding ‘citizens’ groups to ostensibly campaign for the environment, but with very different aims – for example, to remove legislation that prevents drilling for oil or building supermarkets in green areas.

PR and digital marketing firms are usually hired by corporations or super-wealthy individuals to carry out this work, but foreign governments and intelligence agencies sometimes join in too.

The fake grassroots hirelings don’t need to know or care about the actual agenda, and neither do the PR companies. They’re just doing paid work. The agenda comes from the sponsor – usually corporate, with enough secrecy and deniability built in to avoid blame if the astroturfing is exposed.

There are now many more public relations employees than journalists on both sides of the Atlantic, giving corporations unprecedented capacity to shape public narratives. AI is, of course, making many of these techniques cheaper, faster and harder to detect.

Examples include PR firm Freshwater Strategy gathering business sector support for a group called Australians for Natural Gas, an astroturf group set up by gas company Tamboran Resources; and PR firm Burson-Marsteller creating the National Smokers’ Alliance, which placed advertisements and paid young activists to campaign for ‘civil liberties’ on behalf of Philip Morris.

PR Watch do a good job of exposing many more; and Wikipedia covers it well – including one example in a Shakespeare play!

Social connections and shared values

This is connected to the ‘revolving door’ between corporate and political jobs that I’ll cover in an upcoming article. Here I just want to talk about the similarities and connections between political and corporate elites, which create groupthink and render some ideas and approaches unthinkable and taboo.

Backgrounds

C. Wright Mills’ The Power Elite (1956) is the classic starting point on the similar social and educational backgrounds of elites. He argued that in the US the leaders of the corporate, political, and military worlds formed overlapping elite circles. His argument was not that they created formal organisations or secret conspiracies, but that they shared similar educational backgrounds, social networks, clubs, institutions and assumptions about society and power.

Pierre Bourdieu (in Distinction, 1979) developed a more detailed explanation of how elite groups reproduce themselves. His argument was that elite interactions transmit cultural habits (including manners and confidence), vocabulary, networks, credentials and familiarity with institutions of power, which generate a similar worldview, sense of competence and understanding of what counts as ‘serious’ policy.

US and UK studies have outlined the similar routes via private schools and elite universities to corporate and political leadership. For example, in the UK, Eton College has educated numerous prime ministers, cabinet ministers, financiers and CEOs, and the Universities of Oxford and Cambridge have long been recruiting grounds for both politics and business. In the US, similar networks exist around Harvard, Yale and Stanford Universities.

Friendships

These institutions foster lifelong personal networks and friendships that are maintained and expanded via dinner parties, shared holidays, charity galas, sporting events, exclusive clubs, alumni associations and family connections. Elite groups also tend to cluster geographically, in neighbourhoods close to centres of political and financial power. Georgetown, Washington DC is a hotspot for elites in the US, for example.

In those circles, antipathy towards corporate power would be career suicide – although anyone who might hold those views wouldn’t get to be in those circles in the first place. Representatives of small businesses, NGOs, unions or citizens’ groups are not part of these networks and don’t have the ear of politicians in the way that corporate CEOs and majority shareholders do. They (and we) just don’t have the same levels of wealth that brings these elites together. When was the last time you had a former prime minister holiday on your luxury yacht?

Conferences and events

Possibly the best-known coming-together of corporate and political elites is the World Economic Forum annual meeting in Davos, Switzerland, although there are many others, including the more secretive Bilderberg Meeting and the apparently drunken, wacky Bohemian Grove. As well as corporate leaders, Davos is attended by IMF and World Bank heads, prime ministers, presidents and senior military officials.

In Superclass, David Rothkopf writes about his experiences at Davos, mixing with global corporate CEOs, politicians, bankers, media moguls and military leaders. He sees them as a dominant class with no loyalty to any particular country, who run the world for their own benefit (and therefore the benefit of corporations). But there was no condemnation – quite the opposite. There was a lot of toadying, and talk of states as a counterbalance to corporate power, rather than the other side of the same coin. He considers corporate capitalism a given, and so the reformist solutions he outlines require these turkeys to vote for Christmas.

More on how the shared experiences of elites narrow the range of acceptable thought can be found in Colin Crouch’s Coping with Post-Democracy, Peter Mair’s Ruling the Void and G. William Domhoff’s The Corporate Rich and the Power Elite in the Twentieth Century.

Conspiracy?

Politics has become more about managing systems than debating alternatives. Alternatives aren’t generally understood or desired. In elite circles, you don’t have to ask if someone believes that unions or redistribution of wealth are good ideas. It’s just assumed that they’re not. Their money, friendships, interests, comfort, lifestyles, status and legitimacy all depend on support for the corporate status quo. And underneath the elites is a wannabe-elite layer of compliant middle class professionals who realise that their comfort and status depends on the status quo, and they defend it accordingly.

But is there conspiracy? Of course there is. Anyone who’s been part of any organisation knows that there’s corruption and conspiracy everywhere. Are the people who manage to claw their way to the top of corporate or state hierarchies likely to be different? No, I’d suggest that they’re likely to be worse, if you think about the qualities required to get them there. But conspiracy isn’t central to maintaining the corporate order. It can be done without explicit coordination. Don’t think of it in terms of corporate leaders bribing politicians to implement beneficial legislation, or doing anything that might put them in jail unnecessarily. Why would they, when everyone knows what sort of things need to happen to maintain the environment that produces elites?

Conclusion

In the last article we looked at how states formed corporations, and how states and corporations have been hand-in-glove ever since. In this article we looked at the various ways that corporations set the policy agenda and the limits to what can be discussed, and in the next we’ll look at the more direct ways that corporations capture and control states. After that, we’ll look more at what corporations get in return from compliant states.

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This is the third article in an 8-part series based on an essay by Ronan Murphy. The global economy runs on a simple logic. States must grow or be outcompeted, and those that fall behind lose their security. In a system where power still flows, ultimately, from the barrel of a gun, Ronan explores what this means for anyone hoping to build something different.

Part 1 (with a list of articles in the series) can be found here.

Even if internal inequalities are managed, a post-growth community must survive in a hostile environment in the short and medium terms in order to scale. Today’s world is dominated by nation states vying over sovereignty and great powers jockeying for resources and influence. The question then becomes, how does a sustainable experiment hold its own amid the realpolitik.

I, among many others exploring novel forms of alternative political economy over the last two decades, have been inspired by the experience of Rojava, the Kurdish-led autonomous region in northern Syria. Amid Syria’s civil war, the Kurds and their allies carved out a self-governed zone that rejected both Assad’s dictatorship and fundamentalism. What made Rojava particularly special was its embrace of decentralised governance (known as Democratic Confederalism), direct democracy, and feminist and ecological principles synthesised by Abdullah Öcalan. By 2017, an estimated 5 million people – Kurds, Arabs, Assyrians, Armenians, Yazidis and others – were living under Rojava’s system of communes and councils. Its constitution enshrined gender equality, ethnic inclusivity and grassroots decision-making, striving toward a post-state society beyond ethnic nationalism. It could be argued that Rojava attempted a form of post-Westphalian governance on a local scale, rejecting the nation state in favour of a confederation of communities, because the alternative did not represent their beliefs, interests, nor respect their lives.

Importantly, this revolution in regional governance was coupled with an ethic of ecological sustainability and cooperative economy, quite the departure from growth-driven development. The outcome was that citizens of Rojava broadly enjoyed a better quality of life than citizens in neighbouring states using traditional methods of development.

Rojava was a glimpse of a post-Westphalian future, with multi-ethnic coexistence, autonomy, and communal care for people and land.

Its decentralised structure proved resilient in several ways. Power distributed among neighbourhood communes created very strong social cohesion. During times of war against ISIS, Rojava’s model of ‘everyday democracy’ at the grassroots contributed directly to security. Communities, with intimate local knowledge, were able to root out extremist cells and maintain order from below. Women played leading roles in both civil society and defence, famously organising women’s protection units that not only fought ISIS but also transformed norms. This empowerment of previously marginalised groups built a powerful collective stake in the system that made it worth fighting for.

Moreover, Rojava carried ideological power on the world stage. By demonstrating a workable alternative to authoritarianism and fundamentalism it posed a threat to surrounding regimes by example. The success showed that ordinary people could govern themselves without a nation state, patriarchy or profit, an open challenge to the ideological hegemony of both dictators and imperialists.

Ultimately, however, Rojava also exposed the security gaps facing any progressive polity in a world of states. Despite its internal cohesion, Rojava had to navigate reliance on external actors. Its militias, the YPG and YPJ, received air support from the United States to defeat ISIS, tying them to great-power calculus.

When ISIS was defeated in 2017-2018, the Kurdish-led forces found themselves largely abandoned by Western allies and their agreements of necessity. Turkey, fearing a Kurdish autonomous region on its border and emboldened by global indifference, launched an invasion. In early 2018, Turkish forces and their proxies invaded the Rojava canton of Afrin, eventually occupying the territory. They carried out documented war crimes and ethnic cleansing, driving out hundreds of thousands of Kurdish inhabitants.

The world’s major powers largely looked the other way. Turkey is a NATO member and an important regional player. Rojava’s lack of formal statehood meant it had no protection under international law, no seat at negotiation tables, and no patron once it outlived its usefulness in the fight against ISIS. The harsh moral is that even the most enlightened communal society can be crushed by conventional force if it stands alone in the world as it exists now.

As of early this year, Rojava’s self-organised and semi-independent status no longer exists in a meaningful sense. The new Syrian government has begun the process of absorbing Rojava’s governance apparatus into its own, largely permitted by the US’ ambivalence towards its former ally, having previously described their partnership as “temporary, tactical and transactional”. Its survival up to now is a testament to resilience and solidarity, but its struggle is a reminder that security remains a precondition for sustaining progress.

There is also a second lesson that Rojava teaches about strategic positioning. Stuart Kauffman’s concept of the “adjacent possible” describes how complex systems evolve not by leaping to optimal states but by exploring neighbouring configurations that are reachable from where they currently stand.(1) Biological evolution works this way. So do technological revolutions. And so, arguably, do political transitions.

This is consistent with Ilya Prigogine’s own analysis - “When a complex system is far from equilibrium, small islands of coherence in a sea of chaos have the capacity to shift the entire system to a higher order”.

Rojava was not an adjacent possible, but it was an attempt to build a fundamentally different society at the point of highest impediment, surrounded by hostile state actors with overwhelming military superiority.

This suggests a different strategic orientation for post-growth experimentation. Rather than building at the sites of greatest resistance, alternatives should be tested and refined in adjacent landscapes where the same problems exist at lower intensity. Community energy projects in small towns, commons land and housing stewardship in peri-urban areas, or citizens assemblies in cities with sympathetic administrations. These are strategic rehearsals over compromises, for now. The knowledge, institutions, and relational infrastructure built in these spaces can be transferred, adapted, and scaled as conditions shift.

Frank Geels’ multi-level perspective on socio-technical transitions also offers a useful way of thinking about this.(2) Transitions happen when niche innovations build momentum at the margins while the dominant regime destabilises under landscape pressures (climate breakdown, resource constraints, legitimacy crises). The niches do not need to overthrow the regime head-on, but they do need to be ready when the dominant regime breaks, and connected enough to one another to fill the gap.

This is consistent with Milton Friedman’s famous “Only a crisis - actual or perceived - produces real change. When that crisis occurs, the actions that are taken depend on the ideas that are lying around. That, I believe, is our basic function: to develop alternatives to existing policies, to keep them alive and available until the politically impossible becomes the politically inevitable”.

In The Art of Not Being Governed, James C. Scott documents how decentralised, “illegible” communities across Southeast Asia resisted state absorption for centuries through dispersal, mobility, and the deliberate cultivation of social forms that states find difficult to penetrate or administer.(3) Seeing Like a State extends this, showing how centralised governance repeatedly fails when it cannot read or accommodate local complexity.(4)

The implication for post-growth enclaves is that survival may depend less on military parity and more on becoming the kind of community that is costly to absorb and difficult to govern from outside.

The conclusion from this section is that any future post-growth enclaves will face similar exposure unless the broader geopolitical context shifts in their favour. Decentralised autonomy can flourish against the odds, but without a way to deter aggressors they will be strangled. A sustainable transition must be complex, and ready to keep the political option for scaling ready until “the politically impossible becomes the politically inevitable”.

Notes

1. Kauffman, S. (2000). Investigations. Oxford: Oxford University Press. See also Kauffman, S. (1995). At Home in the Universe: The Search for the Laws of Self-Organization and Complexity. Oxford: Oxford University Press.

2. Geels, F.W. (2011). The multi-level perspective on sustainability transitions: Responses to seven criticisms. Environmental Innovation and Societal Transitions, 1(1), pp. 24-40.

3. Scott, J.C. (2009). The Art of Not Being Governed: An Anarchist History of Upland Southeast Asia. New Haven: Yale University Press.

4. Scott, J.C. (1998). Seeing Like a State: How Certain Schemes to Improve the Human Condition Have Failed. New Haven: Yale University Press.

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Contents

1. Introduction

2. The birth of the state-corporate double act

3. Track 1: the long, slow track of peasant dispossession, building factory workforces and corporate consolidation

4. Track 2: the short, direct track of state-chartered mega-corporations

5. The rise of corporate power

6. Conclusion

‘The publicly traded limited liability corporation is a pathological organisational form that must join monarchy as an extinct institutional species’ – David Korten

This is one of a series of articles that I hope to compile into a book – working title, The Commoners’ Manifesto: Neither Capitalism nor Communism. Here’s an introduction to the series. Comments welcome, including disagreement and debate.

In previous articles (see here), I argued that anti-capitalists should reject state communism as the route to a post-capitalist world, and that community-based, commons solutions are more likely to succeed.

Now I want to argue that corporate dominance wouldn’t be possible without states, and that their dominance has allowed them to capture and control the states that created them, so that a post-capitalist world can’t be built via a ‘democratic’ state either, because ‘the master’s tools will never dismantle the master’s house’ (she was talking about feminism, but the same principle applies here).

In this post I look at how states and corporations have been united since the birth of corporations. In the next 2 posts I’ll look at how corporations set the agenda and control states. Later posts will look at how those captured states ensure that corporations retain their size and power.

Introduction

In the West, people cling to the idea of democracy (power resides with ‘the people’). But power has been bought, which means that what we have now is plutocracy (power resides with money). I’m going to talk about the ways that plutocracy arises and is maintained, none of which require conspiracy (although I’m sure they happen), and all of which can be confirmed quickly with an online search. None of them require laws to be broken (although again, it happens sometimes). It’s all done within the normal operations of capitalism. It’s not about bad individuals or companies either; if they die or fail, they’ll be replaced very quickly. The problems are systemic, and the state is captured slowly and under the radar, not in a one-off spectacular event. States and corporations have been entwined since corporations were first formed, so that now we have a system in which corporate influence is not just readily accepted by the political class – it’s encouraged and requested. They’re accomplices; their status depends on it.

I’ll write mainly about what’s happening in the US political system. Similar things happen everywhere, but without the global ramifications of what happens within the US hegemon in a unipolar world. That will change later this century, but it’s the case right now.

Plutocracy is not a new phenomenon. Centralised states have always been and always will be controlled by the wealthiest and most powerful in society. This was already bad news for the ordinary citizens of ancient Sumeria and medieval Europe – but at a time of such massive damage to the biosphere, inability to shift the status quo due to the power of money is now an existential threat to our species.

In the 1980s, Reagan, Thatcher, Deng and Gorbachev (and then Yeltsin) were singing the praises of the free market, rather than Keynesianism and the stagflation and recessions of the 70s. But what they were really talking about was capitalism, which I want to argue is anything but a free market, because capitalism concentrates wealth, which is then used to buy power and skew the market.

What I’m not saying is that the corporate sector is a monolithic actor. Amazon and Walmart might be looking for regulatory barriers to entry for smaller competitors; Blackrock and Vanguard want liquidity and volatility; extractive corporations (e.g. oil and mining) want deregulation; tech platforms want privacy laws weakened or removed etc. These agendas often conflict. What I’m talking about is the use of the state by the corporate sector to maintain an environment that gives advantages to giantism and restricts competition from small businesses, non-profits, co-ops and commons.

In the past, wealth concentrated in monarchies, the landowning class and the church, but today it’s with the majority shareholders of corporations (not ‘banks and corporations’, because banks are corporations). Let’s look at how corporations came to be, how they concentrated wealth, and how that concentrated wealth buys power today.

The birth of the state-corporate double act

There were two overlapping tracks in the formation of corporations, and both were state-driven. One track saw the British state pushing people off the land over many centuries, and later into the new urban factories, some of which then slowly developed into large corporations. The other track was much more direct – the chartering of giant corporations like the East India Companies by states, uniting the aristocratic and merchant classes under state power.

Track 1: the long, slow track of peasant dispossession, building factory workforces and corporate consolidation

First, states saw to it that the rural poor were no longer able to support themselves from the land (see my previous post, What Marx got right, from a commons perspective, especially the Transition from feudalism to capitalism section). The state implemented enclosure acts, to allow the nobility to capture common land, all the way back to the Statute of Merton in 1235, initially for wool production, and peaking in the 18^th and 19^th centuries, when removing peasants’ ability to feed themselves from common land effectively pushed them into urban areas to provide the workforce for the new industrial factories. Acts criminalising vagrancy made it illegal to be idle or homeless, which had the same effect.

These new factories weren’t joint-stock companies or corporations – they were overwhelmingly sole proprietorships or private partnerships owned by wealthy individuals or families.

Politicians were mainly landed gentry until the Reform Act of 1832 broke their monopoly on power and gave industrialists a foothold that helped them become the political elite later in the century. Prime Minister Sir Robert Peel’s family became wealthy through northern textile factories. Industrialists and state elites were more than allies or co-conspirators – they were the same people.

In the late 19^th century, after decades of accumulating immense private wealth, the most successful private factories outgrew the capital of single owners or small partnerships, and became consolidated into giant public corporations. For example, the Dowlais Ironworks – a partnership in south Wales – was the largest steel producer in the UK, that eventually became the multinational GKN.

The legal roots of these corporations can be traced back to the limited partnerships of Renaissance Florence, which separated active directors from passive investors. The latter were allowed to remain anonymous, and their liability became limited to the amount invested. Wealthy nobles, who traditionally looked down on commerce, could then invest without losing social status, and with much less risk. This led to the formation of the joint-stock company with publicly-traded shares that anyone (including foreigners) could buy, which generated the massive capital for, and spread the risk of, the extremely hazardous colonial incursions of that time. This transformed investment in these proto-corporations from an elite hobby into a global engine of early capitalism, and the aristocratic and merchant classes were finally united.

But the joint-stock companies weren’t corporations, in that they weren’t separate entities from their members – so the company couldn’t own property in its own name, and shareholders could be individually responsible for the company’s debts. This changed with the Joint Stock Companies Act of 1844 in the UK, which made incorporation easily available through a simple registration process. This legislation paved the way for the modern corporation, where the joint-stock principle and separate legal entity are standard features.

Track 2: the short, direct track of state-chartered mega-corporations

The British and Dutch East India Companies were joint-stock companies founded by super-wealthy merchants embedded in the British and Dutch states, which chartered them as two of the earliest true mega-corporations (the British in 1600, the Dutch in 1602 – along with the world’s first public stock market for corporate shares, in Amsterdam). They weren’t the first, but they were by far the biggest.

The first governor of the British East India Company was an MP, although of course this was before 1688, when parliament became the dominant decision-making institution of the state, rather than the monarch. Company officials were embedded in the machinery of the state. The landed gentry invested in these charters to protect and enhance their wealth and power.

The Crown granted these companies exclusive monopolies over industries and geographical areas, and provided them with direct military and legislative support; and the companies served the state’s strategic interests. They didn’t create value – they extracted it. This all guaranteed maximum returns for the new elites and prevented competition from small, local businesses. Things are still much the same today.

The first corporations didn’t concentrate wealth. It was already concentrated in the people who formed them, who then made sure it remained concentrated in corporations, as the power of monarchs, landowners and the ancien régime waned.

William Dalrymple’s The Anarchy is a wonderful source of information on the founding and violent rise of the British East India Company, focusing on the characters involved; Wallerstein’s Historical Capitalism contains a great overview of the transition from feudalism to capitalism and capitalism’s subsequent expansion; and Korten’s When Corporations Rule the World contains a lot of good stuff on the birth and rise of corporations.

The rise of corporate power

European states developed their economies, cultures and legal frameworks to benefit their corporations and to extract as much wealth as possible from their colonies, in order to grow the wealth and military power that would be needed in the huge wars for global dominance that were to follow. The centralised power of states and the monopoly power of corporations reinforced each other and produced the giant state-corporate double acts that remain in power today.

With charters and state backing, corporations went completely global – and their main activities were colonial extraction everywhere. British chartered companies were fleecing other colonies too, not just India. Colonies, including America, had to provide raw materials for British industry, but they weren’t allowed to make finished goods themselves. As you might have heard, the Americans revolted, to say the least. Things were looking bad for corporations in America. The American economy initially revolved around family farms and small, local businesses, and Americans were driven by community, freedom (for some) and democracy (for some), all of which were being destroyed by corporations.

There were big struggles by the American people against corporations in the early years of the US. Around the same time, Adam Smith was railing against them too, in The Wealth of Nations, published in 1776, the year of the American Revolution. Smith is often wheeled out by the right, but he distrusted and disliked corporations as much as he distrusted and disliked states. Actually, he believed that states exist to tax the public to subsidise corporations and to intervene in the market on their behalf – which is exactly what I want to argue.

Smith favoured the ‘invisible hand’ only in terms of small businesses with owner-managers embedded in their communities, not giant companies owned by the super-wealthy and given state subsidies from the beginning. Railways, for example, couldn’t have happened without state subsidies. The same now goes for the aviation and fossil fuel industries (and others). More about ‘corporate welfare’ in upcoming articles.

Corporations embarked on a campaign of purchasing democracy, so that citizens’ rights were diluted and corporate rights enhanced, until the state granted them legal ‘personhood’ at the end of the 19^th century. This, together with the limited liability that they already had, transformed them from aristocratic ventures into mass-investment vehicles. The state didn’t just enable corporations; it created the legal conditions for their dominance. Corporations merged and acquired each other to increase in size to eventually become the behemoths they are today.

Although corporations obtained personhood, they received state benefits that real persons don’t have; and unlike real people, they don’t die, so they’re able to amass wealth indefinitely, and ride out bad times or periods when conditions might not be ideal, and certain governments might be legislating against them. If you’re immortal, it won’t be long before circumstances change and a corporate-friendly government is returned to power.

Private ownership of the economy, as distributists point out, wouldn’t be such a bad thing if it were in the hands of millions of people, with a level playing-field. But that’s not how capitalism works. The means of production and exchange, the giant ‘feudal’ tech platforms and essential infrastructure have all been concentrated in the hands of a tiny percentage of insanely-rich people – the majority shareholders of the world’s biggest corporations.

Corporate tentacles now reach our High Streets via local branches, our homes via TV and internet advertising, our finances via mortgage and credit card debt, and our minds via branding. They suck money from individuals and communities to ensure that wealth and power remain concentrated, and they make us feel grateful for it, because ‘they bring jobs and choice’ (although small businesses provide more jobs, and the kind of choice they mean is generally between things like different kinds of fizzy drinks and fast food).

Conclusion

Don’t think that our modern, corporate landscape and culture is somehow natural or inevitable. It’s not – it was initiated and has been carefully cultivated by those with wealth and power over the last four centuries. But it doesn’t have to stay this way – and nature will eventually show us that it can’t. Those of us wanting to build commons are faced with a Network of Global Corporate Control. Not the most fertile ground for commons, but hey, it makes for an interesting (and necessary) challenge. We won’t defeat them by fighting them at the national or global scales, which are already captured. But they haven’t entirely captured communities and individuals yet, so we can fight them at the local and personal levels, and federate to compete with them at the national and global scales.

In this post I’ve talked about how the state-corporate relationship began, and has developed. In the next two posts I’ll look at how corporations now set the agenda to shape what’s thinkable, and then the various ways that corporations put pressure on governments to ensure that they get their way, so that the state remains a tool for maintaining the size and power of transnational corporations.

In an age defined by division, inequality, and a deep-seated sense of isolation, the concept of “commoning” feels less like an archaic tradition and more like a radical, necessary blueprint for the future. It’s a powerful idea that reclaims the principle that some things – land, resources, community – should be ours to share, protect, and manage together. This October, the town of Stroud in the UK will become a vibrant hub for this idea, hosting the Festival of Commoning 2026 under the fitting theme, “Common Ground: Healing Divides.”

The third annual Festival of Commoning will take place across Stroud on Friday 2 and Saturday 3 October 2026.

This year’s theme is Common Ground: Healing Divides. We will celebrate stories from people and projects who use commoning practices to foster belonging, mutual care, resilience, and shared power in the face of growing societal division, polarisation, inequality, isolation and exclusion.

This year we’re creating more spaces for people to connect with each other, learn new collaborative skills, and get out and about to see commoning projects already making an impact in and around Stroud.

The festival is being organised by a group of volunteers, local to Stroud, connecting to and drawing on the global commoning movement. It is a festival for doers, organisers and people who want to common, providing an opportunity to come together, share our stories, inspire one another and learn new skills.

See the line up so far here.
And buy your tickets here.

Understanding commoning: a philosophy of shared stewardship

Before diving into the festival itself, it’s worth understanding the philosophy that underpins it. Commoning isn’t just about sharing resources. It’s a dynamic social practice. It involves a community coming together to manage resources – land, housing, digital platforms, a local park, or a community kitchen – collectively and for the common good. The ethos is often summed up in three powerful principles: “Own it together, Make it affordable, Keep it forever.” This stands in stark contrast to the extractive logic of privatisation and the neglect of public goods.

Commoning is an act of resistance against the forces that isolate us. When we common, we reject the idea that we’re all just consumers or individuals in competition. Instead, we embrace our identity as citizens and neighbours with shared responsibilities and mutual care. The Festival of Commoning 2026 is a celebration of this spirit, exploring how these practices can foster belonging, mutual care, resilience and shared power in a world that often feels fragmented.

The three pillars of commoning: Head, Heart, and Hands

This year’s festival has a holistic approach, structured around three core elements: Head, Heart, and Hands. This framework ensures that participants engage with commoning on every level, from intellectual understanding to emotional connection and practical application.

The Head is for inspiration and learning. This is where attendees will hear the stories of commoning projects from across the UK and the world. It’s a chance to learn about their origins, the challenges they’ve overcome, and the secrets to their success. By listening to these narratives, participants can gather the knowledge and confidence to apply similar principles in their own communities. Storytelling is a powerful tool: it humanises complex issues and shows that change is not only possible but is already happening.

The Heart focuses on connection and participatory learning. Through workshops, participants will have the chance to experience commoning practices first-hand, discuss core themes with fellow enthusiasts, and deepen their knowledge and skills. This element fosters the mutual care and shared power that are central to the commoning ethos, building the human connections that are the bedrock of any strong community. There will be plenty of time for participants to connect and inspire each other, recognising that the most important contributors are the people who attend.

The Hands are where the festival’s ethos really comes to life. It’s about getting out and getting stuck into real-world commoning projects. In and around Stroud, attendees can contribute to tangible efforts that embody the principles they’re learning about. These hands-on experiences are not just about volunteering; they’re a powerful demonstration of how commoning can create immediate, positive change.

The specific projects available this year highlight the diversity of commoning in practice:

• Conservation at The Heavens: This is a story of community power. The Heavens is a stunning piece of land near Stroud that was saved from potential development by a community land buy-out. By helping with conservation efforts there, participants are literally contributing to a project that has been secured for the common good forever. It is a direct example of the principle “Keep it forever” in action, protecting both nature and public access.

• Harvesting at Common Soil: This community-supported agriculture (CSA) project is a direct challenge to the industrial food system. By harvesting vegetables at Common Soil, participants see how communities can take control of their own food production. CSAs like this build resilience by shortening supply chains, promoting sustainable farming, and ensuring access to fresh, affordable produce for everyone.

• Cooking with Reclaimed Food at the Trinity Rooms: This project tackles the twin problems of food waste and food poverty. By cooking up a feast with reclaimed food at the Trinity Rooms, the festival participants will engage in an act of practical solidarity, transforming surplus into nourishment and community. It is a perfect example of how commoning can turn a problem (waste) into a solution (a shared meal).

  

A festival rooted in the community

Stroud is a town with a thriving culture of community action and social enterprise. The festival’s social events for 2026 encapsulate this spirit and are an integral part of the commoning experience.

The weekend kicks off on Friday night with a community meal at The Long Table. This is more than just a dinner; it’s a powerful example of commoning in action. As a pay-what-you-can restaurant, The Long Table ensures everyone can eat together, regardless of their financial situation. Founded by baker Tom Herbert, it operates on a model of dignity and inclusion, creating a space where conversations can flourish between people from entirely different walks of life. The very act of sitting at a long table together breaks down barriers and fosters the kind of mutual understanding that is essential for healing social divides.

The evening then moves on to Stroud Brewery to celebrate the beginning of Black History Month. This is a brilliant gesture that ties the local festival to broader cultural and historical conversations, acknowledging that the struggle for common ground is intrinsically linked to the fight for racial justice and equality. The festival will culminate on Saturday with another community meal and music at the Trinity Rooms, further solidifying the bonds formed over the weekend and highlighting the venues in Stroud that are themselves community hubs.

Commoning as a beacon of hope

The Festival couldn’t be more timely. We live in an era of unprecedented wealth alongside extreme poverty, hyper-connectivity alongside profound loneliness, and global awareness alongside tribal conflict. The ‘divides’ mentioned in the festival’s theme are everywhere – economic, social, political, and environmental. For many, the future feels precarious, marked by anxiety around the destruction of nature, housing crises, and a sense that the systems governing our lives are failing us.

In this context, the Festival of Commoning offers a practical and hopeful alternative. It doesn’t offer quick fixes but shows that another world is possible. It demonstrates that people can come together to create affordable housing, protect green spaces, manage local economies, and build support networks. It shifts the focus from what we lack to what we can build together. It replaces despair with agency. For anyone feeling overwhelmed by the state of the world or unsure how to make a difference, this festival offers a clear and inspiring path forward. It’s a place to build resilience, share power, and create belonging, proving that the best way to heal divides is to build commons together.

See the line up so far here.
And buy your tickets here.

The problem of land

There is a very persistent problem in many of our lives, and this same problem is an issue that needs grappling with when trying to create new commons. This problem is access to land. Most people don’t own land, but instead rent it, which comes with restrictions on usage and a sense of impermanence. At the same time, both owners and renters can completely lack access to land that is usable for subsistence.

My own living arrangements are a good example. Being a tenant restricts my ability to make adjustments that would help me store more food. My plight is shared by other tenants in many ways: it can be difficult to invest in a space you could be evicted from or priced out of next year. You may also face prohibitions on putting holes in the walls, preventing you from putting up shelving. More importantly, I have no outdoor space I could use for any purpose whatsoever. The outdoor space around me is either privately owned by its occupants, or by a landlord that lives in another town, or is owned and managed by the council. There’s a tiny community garden which doesn’t really have space for my own use, and the waiting list for allotments is immense. Where, exactly, am I supposed to cultivate the land?

People around the world face a disconnection from the land in ways both quite similar and very different to what I experience. The land problem is massive. Unable to meet our own needs directly by working the earth, we are reliant on buying stuff with money earned from jobs – jobs where most of the work we do benefits our bosses, where the exhaustion and commutes disconnect us from our community, and where we may endure moral injury doing things we think are bad in order to keep food on the table. Reclaiming the means of subsistence is central to movements like the Landless Workers’ Movement (MST) and to books like Chris Smaje’s Finding Lights in a Dark Age (we’ve interviewed Chris: click here).

Our disconnection from the land has consequences on both the individual and the landscape scale. People who cannot work the land for subsistence are forced to rely on their ability to purchase goods, which may be lacking. In Feed Us With Trees, Elspeth Hay details the health impacts of the Karuk First Nation losing access to their subsistence landscape: in a community previously considered to have minimal rates of heart disease and high blood pressure, modern-day Karuk now suffer these problems three times higher than the U.S.A. average. Frances Moore Lappé and Joseph Collins’ World Hunger notes that tenant farmers and landworkers are disinclined from pursuing sustainability, as they don’t know if they’ll be evicted in the next year. Alex Heffron highlights that in order to get funding, many farmers have to use unsustainable techniques, as funders are in it for profit and consider “unconventional” agriculture a risk.

As communities that want to make a living off the land and reconnect with the seasons and food-celebration, we are wrestling against developers with far more purchasing power than us. Where might there be space for us?

An untapped resource?

Where, exactly, am I supposed to cultivate the land? And – where might there be space for us? I’ve thought about these questions a lot as of late, being a part of the online community for the Poor Proles’ Almanac, where others share their agroecology exploits. The community is varied, with some folks being owners of properties with outdoor space, and others, like me, having no space whatsoever. Some people discuss foraging, others guerilla gardening, and one person has an impressive indoor growing setup that can support small trees. We discuss what it would take to localise our food system, and to practice agroecology, in places and cultures that might well be interpreted as hostile.

Where I live – and in many towns and lower-density parts of cities – there are many yards and gardens. Some yards and gardens are owned, some are rented. Some are connected to council housing. Not everybody who has access to a yard or garden (rented or owned) works that land. They might not be interested. They might be too busy. They might be elderly or disabled and struggle with maintenance tasks. They might not have the money for equipment or labour that would make their yard or garden manageable.

This felt like a niche left unused. Surely, at least some of the folks with yards and gardens left unused would be interested in someone working that land?

Turns out: yes! And also, others had already started up community projects along similar lines.

The Black Radish

The first example I learned of was The Black Radish, a community supported agriculture (CSA) project in Minneapolis. I learned about The Black Radish from an article on the news outlet Civil Eats. Their model is that they have two farmers that do most of the work. They have people sign up to “donate” their yard or garden – it’s so popular that there’s a waiting list. In exchange, they get the equivalent to a free CSA membership and someone doing their garden work for 9 months a year. The farmers get access to land and water in exchange. Food that doesn’t get taken by CSA members is donated.

When I’ve brought up The Black Radish in conversation, some folks remark that they may have heard of some other similar projects (though they are nonspecific, and do not recall). If you know of any, please pop in to the comments below or make a post on the farming and smallholding forum section we have.

Neighbourhood farms

The Black Radish isn’t the only existing example of using yards and gardens as farmland. A member of the Poor Proles’ Almanac’s online forum wrote to me about a successful project he had been involved in:

“We got corporate donors to provide the tools and materials needed to install growing space in participants’ yards [and gardens], and got the city to subsidise water for anyone in the program, so it was basically free to join and once we got enough folks signed up on a street we’d schedule a workshop. The only requirement of the program was to share at least 50% of the harvest with neighbors. We launched this in an area where nearly everybody was using amphetamines or needle drugs and it was really cool to see people reduce their drug use in favor of gardening and community.”

This model of a neighbourhood farm uses short-term outside support in the form of tools and knowledge to create long-term resilience. Tried and proven to work in neighbourhoods that would usually be written off, it is a powerful example of what else can be tried. The Black Radish model reduces the labour required from the yard- and garden-providers by leaning heavily on a group of farmers. This neighbourhood farm instead considers farm labour to be a benefit, a way for people to contribute meaningfully to their community. As I wrote in my post about mental health, a sense of contribution can make a massive difference to someone’s wellbeing.

Urban farm networking

The same online Prole who told me about this project also told me about an idea he has been mulling over, which he would be excited to get feedback on:

“I’ve been working off and on for a design for a distributed farm based around a web application where growers could track their crops and harvests, and the only centralised part would be collection and redistribution. [...] My hypothesis is that every food gardener tends to produce excess of something, so if we pool all the excess and redistribute it people will benefit.”

This is a third model, one which resembles a scaled-up version of a community project I have benefitted from. There are folks with allotments who pool their excess and donate it. This “virtual farm” envisions this on a larger scale, possibly linking the produce of Black Radish model and neighbourhood farm model projects. After all, why can’t these exist in tandem?

These models not only address the material needs of both the farmers and the residents, but do the culture-shifting work of de-commodifying food – entrusting members to “take what they need”, donating the rest for free, and knitting people back in with food systems. Gunnar Rundgren calls this “relationship food” and a pathway that is more resistant to commercialisation than selling anonymised food to supermarkets. It reactivates subsistence as a link between people and our landscape.

Moving forward with these ideas

Why can’t The Black Radish model or the neighbourhood farm model be used elsewhere? Of course, there will be differences, depending on law, landscape, and community. The Black Radish got its start when its farmers turned their own front garden into a farm, which was a good way to get their neighbours excited about the idea. As someone without any garden to speak of, I cannot simply follow the same steps.

So: I am going to try out this idea in my own community. Regardless of successes or failures, I will record the way things develop, how the shape of the land and its peoples alter the trajectory of the project. It will be interesting to see how things shake out.

This is the second article in an 8-part series based on an essay by Ronan Murphy. The global economy runs on a simple logic. States must grow or be outcompeted, and those that fall behind lose their security. In a system where power still flows, ultimately, from the barrel of a gun, Ronan explores what this means for anyone hoping to build something different.

Part 1 (with a list of articles in the series) can be found here.

“The old world is dying, and the new world struggles to be born. Now is the time of monsters” – Antonio Gramsci.

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Under conditions of growing inequality, attempts to impose ecological limits can morph into explosive social conflict. We have already seen warning signs. France’s gilets jaunes erupted when a fuel tax was perceived as unfairly burdening the rural poor. People will not support sustainability policies that they feel trample on their livelihoods or entrench privilege. Ulrich Brand and Markus Wissen describe this resistance as a defence of the “imperial mode of living”, the observation that consumption patterns in the Global North are structurally dependent on cheap labour and resources from the Global South, and that this dependency is so deeply embedded in everyday life that people defend it unconsciously, even when it is destroying the conditions of their own future.¹ The backlash is not irrational; it is a predictable consequence of asking people to give up material comforts that the entire structure of modern life has taught them to treat as normal.

More ominously, these grievances create fertile ground for reactionary movements, precisely the forces that would derail a sustainable transition. Today we see the emergence of eco-fascists and hard-right nationalists who twist environmental narratives to serve xenophobic or authoritarian agendas.

These tendencies come from distinct but converging directions. Derrick Jensen, co-founder of Deep Green Resistance, approaches from the radical environmentalist left but has drawn sharp criticism for using essentialist conceptions of the “natural” to peddle transphobic talking points about who should be involved, and more dangerously “in” with, an ecological transition. Separately, far-right figures like Keith Woods describe disaffected and alienated former leftists as their primary targets for recruitment, coat-tailing onto legitimate ecological grievances while redirecting blame toward immigrants and minority groups.

These groups offer scapegoats instead of solutions, and in a transitional period, these elements could gain traction by exploiting fear and frustration. Similarly, ultra-nationalists promise to put their nation’s survival first, often at the expense of global cooperation, and could rally even further support beyond their existing success if people feel threatened by scarcity or decline.

If progressive governments attempt bold climate and redistribution policies, powerful industry lobbies can be expected to respond, whether through lobbying, capital strikes, or funding misinformation on a scale far beyond their practice for the last 50 years (see: Dark Money by Jane Mayer).

Social justice, therefore, is a core security requirement for sustainability. As the United Nations’ poverty rapporteur warned, we risk a kind of “climate apartheid” where the wealthy buy their way out of crisis while the rest suffer – a scenario that would all but guarantee social breakdown and authoritarian backlash.

Recent research confirms that high economic inequality is one of the strongest predictors of democratic erosion and backsliding. Feelings of being “left behind” make populations susceptible to anti-democratic strongmen who promise order or revival.

This suggests something important about the sequencing of transition itself. Systems undergoing fundamental change are fragile. They are susceptible to shocks, backlash, and cascading institutional failure. The resilience literature, particularly the work of Carl Folke and the Stockholm Resilience Centre, distinguishes between systems that can absorb disturbance while maintaining function and those that are brittle and prone to collapse.² Brian Walker and David Salt make a similar point, arguing that managing for resilience requires maintaining the diversity and redundancy of institutional and ecological functions, especially during periods of transformation.³

Applied to the political economy of transition, this means that before any post-growth society can build the virtuous feedback loops of cooperative economics, community energy, and regenerative agriculture, it must first stabilise its institutional foundations. It must invest in shock absorbers. For example, wage support for workers leaving carbon-intensive industries, core funding for community anchor institutions facing insolvency, or emergency adaptation funding for the most vulnerable housing stock.

These investments may not produce immediate positive-sum outcomes, and they may not be mutually reinforcing in the way that a mature regenerative economy would be, but they preserve agency, buy time, and hold space for more ambitious structural change. They prevent the permanent exit of key civic actors from the transition landscape.

The transition management literature, particularly the work of Jan Rotmans and Derk Loorbach at the Dutch Research Institute for Transitions, describes this as the pre-development phase of systemic change, the period where experimentation is possible precisely because existing institutions are buffered against collapse.⁴ If we skip this phase, the transition will likely be captured by those with the resources to weather the storm, which is to say, the very actors whose interests are served by the status quo.

To avoid this fate, post-growth transitions must aggressively prioritise equality and inclusion at every step. This means policies like wealth redistribution, guaranteed basic services, and just transitions for workers, ensuring that the burdens of changing the economy fall on those most able to bear them (and most responsible) while the benefits of a greener society, clean air, community life, economic security, are broadly shared.

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Notes

1. Brand, U. and Wissen, M. (2021). The Imperial Mode of Living: Everyday Life and the Ecological Crisis of Capitalism. London: Verso.

2. Folke, C. (2006). ‘Resilience: The emergence of a perspective for social-ecological systems analyses’. Global Environmental Change, 16(3), pp. 253-267. See also Folke, C. et al. (2010). ‘Resilience thinking: integrating resilience, adaptability and transformability’. Ecology and Society, 15(4).

3. Walker, B. and Salt, D. (2006). Resilience Thinking: Sustaining Ecosystems and People in a Changing World. Washington, DC: Island Press.

4. Rotmans, J. and Loorbach, D. (2009). ‘Complexity and transition management’. Journal of Industrial Ecology, 13(2), pp. 184-196. See also Loorbach, D. (2010). ‘Transition Management for Sustainable Development: A Prescriptive, Complexity-Based Governance Framework’. Governance, 23(1), pp. 161-183.

This is the first article in a new 8-part series based on an essay by Ronan Murphy. The global economy runs on a simple logic. States must grow or be outcompeted, and those that fall behind lose their security. In a system where power still flows, ultimately, from the barrel of a gun, Ronan explores what this means for anyone hoping to build something different.

Post-growth political economy, security, commons, alternative finance, and the governance of planetary futures.

Here’s a list of articles in the series (links to articles as they’re published):

1. Deconstructing Growth

2. On Inequality

3. Security Gaps and Lessons from Rojava

4. Guns or Butter

5. From Leviathan to Gaia

6. Beyond Fossil Finance

7. Notes on Techno-Libertarianism

8. Pillars of a Different Vision

Introduction

In the shadow of escalating great power politics, the idea of wellbeing-oriented local and planetary economic governance systems emerges as a radical yet increasingly convincing alternative to the existing global economic order. One that, to many, offers freely the most powerful force known to humanity. Hope. Hope in the face of declining living standards, hope when a nice place to live is a pipe-dream. To others it represents a regressive Malthusian distraction to the progress we have defined ourselves by for the last two hundred years (at least in the West), an insult to our ability to adapt and overcome. The roughly 2.7 degrees of global warming that our current and woefully inadequate emissions trajectories have us on may make clear which is the reasonable approach.

This challenges entrenched Westphalian state-society relations. The current geopolitical system, rooted in a relentless pursuit of accumulation, power, economic growth, energy security and militarism, is fundamentally incompatible with the ideals of sustainable long-term resource management, conservation, and the delivery of an increased quality of life for Earth’s population of nearly 10 billion by 2050. Current growth-led trajectories don’t have global poverty alleviation rates consistent with a minimum, but still much too low, daily income of $5 per day being met for 207 years.¹

At the heart of this lies the link between a nation’s military-industrial complex and its economy, itself a product of realist conceptions that nation-states are first and foremost concerned with security, power, and survival in the anarchy of international relations. The relentless drive for economic expansion, often justified as a means to build national security and maintain influence, has led to an insatiable consumption of biophysical resources. This trajectory is increasingly at odds with the urgent need to address the looming threat of ecological systems collapse due to overconsumption.

This is a paradox. Our shared future demands we reduce growth, but doing so under a shadow of competitive geopolitics seems to undermine the very security needed to make that transition viable.

This provocation serves to explore the very real fear that no nation-state can commit to significant reductions in resource use and consumption without fundamentally undermining the structures that underpin their military and economic strength, and in turn, national security. And that even if attempted, capitalist forces in the global and national economies respectively would ferociously respond with economically destructive actions such as capital flight and investment strike. Karl Polanyi described this dynamic in 1944. When society attempts to protect itself from the destructive consequences of unregulated markets, markets push back. He called it the “double movement”.² We have seen it play out repeatedly across two centuries of industrial capitalism, and there is no reason to believe a post-growth transition would be spared.

This deadlock represents, I think, the most formidable barrier to the realisation of a hypothetically remedial a-growth (or even any truly-sustainable) political transition that advocates for a deliberate downscaling of production and consumption to achieve ecological and social sustainability.

This series will explore these topics, and some potential solutions, using the following structure.

1. Deconstructing Growth

2. On Inequality

3. Security Gaps and Lessons from Rojava

4. Guns or Butter

5. From Leviathan to Gaia

6. Beyond Fossil Finance

7. Notes on Techno-Libertarianism

8. Pillars of a Different Vision

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Deconstructing Growth

Infinities are powerful ideas. When discussing human nature, human potential and capacity for improvement, we often describe them as endless, boundless, or infinite. Thus, infinities are assumed and taken for granted in the systems we design – the economy included.

From the perspective of a physicist, modern notions of endless compound interest-led increases in value make very little sense. If exponential economic growth could continue indefinitely, it would need to be the most powerful force in the universe, because it would need to overcome some otherwise fundamental physical limits. Beyond thermodynamic barriers to growth, there are spatial and biophysical barriers to growth on a finite planet,³ and were this barrier to be overcome, an upper limit to potential growth and value via limits to theoretical productivity, expansion and value. Assuming we humans colonised and productively designed a Milky-Way-sized economy based on either material extraction or services over a conservative estimate of 100,000 years, physical limits, no matter the size, can never satisfy an exponential function of growth, with rather paltry estimates of annual return rates in such a scenario ranging from 0.075% to 0.1%, and if each individual person manages to produce a whopping googol dollars of 2020-equivalent value per year, 0.3%.⁴

These are important theoretical exercises in challenging ideas of anthropocentric infinities, and open the door to a potentially liberating acknowledgement of limits in wider social consciousness.

Growth is more than Simon Kuznets’ measure of a nation’s goods and services (GDP). It is an idea. It was not until the 1950s that growth as a basis of policy became dominant. It is a social process, maintained via a form of “dynamic stabilisation”; much as a bike finds stability in speed, modern economies must continuously expand in order to maintain their structure.

It is also a descriptive term for the material processes an economy with all its social metabolism facilitates. Complexity economics, as developed by Brian Arthur, Eric Beinhocker, and the Santa Fe Institute tradition, gives us some of the tools to understand why this is so.⁵ Economies are not equilibrium machines that can be dialled up or down by adjusting policy levers; they are non-equilibrium, path-dependent systems in which growth emerges from interlocking feedback loops, institutional lock-ins, and self-reinforcing dynamics. The bike analogy works because the structure of the economy is inseparable from its momentum. You cannot stop pedalling and expect the thing to remain upright. A sustainable economic transition then requires both the political will to slow down and the structural redesign of the feedback dynamics that make expansion a precondition of stability. This has consequences for everything that follows in this series.

One dimension of this structural compulsion is the monetary system itself. The financial system creates money primarily as interest-bearing debt. When a bank extends a loan, it does not lend out existing deposits, It creates new purchasing power ex nihilo, as Jakab and Kumhof demonstrated for the Bank of England in 2015.⁶ That new money enters the economy carrying an obligation of principal plus interest being repaid. But the interest was never created. It must be earned by expanding economic activity. Growth, in this reading, is a structural consequence of how money is created, and not just a priority of policy. It then follows that a no-growth economy would under current monetary arrangements tend toward cascading default, as borrowers compete for a stock of money insufficient to service the aggregate debt.

Tim Jackson and Peter Victor explored this in 2015, modelling whether credit creation and interest-bearing debt produce an inherent growth imperative. They found that interest-bearing debt does not mechanically require growth in all conditions, but they concluded forcefully that monetary reform remains essential to a sustainable economy, given the system’s tendency to drive “unsustainable levels of public and private debt, increased price and fiscal instability, speculative behaviour in relation to environmental resources, greater inequality in incomes and in wealth, and a loss of sovereign control of the money system”.⁷

The problem runs deeper than even the mechanics of credit creation. The entire apparatus through which societies recognise, account for, and distribute value is calibrated for a growth economy. Robert Costanza estimated the annual value of global ecosystem services at $33 trillion in 1997, a figure that exceeded global GDP at the time.⁸ None of this appeared on any balance sheet. The institutional capacity for converting ecological and social value into something legible to markets, and therefore into something that can attract investment and sustain livelihoods does not exist at scale. Herman Daly spent decades arguing that conventional economics treats the economy as a closed system exchanging goods and money, ignoring the biophysical throughput of energy and matter on which all economic activity ultimately depends.⁹

A post-growth economy therefore requires different money as well as an alternative accounting infrastructure altogether, one capable of recognising forms of value that the current system ignores. You cannot exit the growth imperative without exiting, at least partially, the monetary and accounting systems that enforce it.

As a psychological, social, and material phenomenon, an alternative framework must focus on more than just removing GDP from policy circles. Transcending growth dictates the deconstruction of its philosophies, roles in wider power dynamics, and its ecological consequences.

Critiques of growth span ecological, socio-economic, cultural, anti-capitalist, feminist, anti-industrialist, anti-development, and green-growth dimensions.

Growth destroys the ecological foundations of human life. The prevailing circular flow model does not account for dependence on resources, energy or sinks. GDP is not necessary, and in many cases counterproductive, for net increases in human quality of life – what Herman Daly called “uneconomic growth” – the observation that beyond a certain income level, more growth brings more costs than benefits (the Easterlin Paradox).¹⁰ Costa Rica, with a GDP per capita more than five times lower than the US, consistently scores higher on the Happy Planet Index.

The endless pursuit of growth produces alienating ways of working, living, and relating to each other and nature, fuelled by David Graeber’s cultural critique “Bullshit Jobs”, where he challenges dominant conceptions of humans as homo economicus, seeing us instead as adaptable, socially dynamic communities who have thrived on cooperation.¹¹

There is a risk in this cultural critique, however, of treating growth as something purely imposed from above. Marshall Berman’s reading of modernity as a lived experience in All That is Solid Melts into Air complicates the picture. The same forces that alienate and exploit also liberate. The first generation to have electric light, the first woman in a family to attend university, the sense that tomorrow could be genuinely different from yesterday, are not false consciousness. They are real experiences of emancipation that billions of people alive today associate with economic development. A post-growth programme that dismisses this desire, treats it as propaganda or delusion, or does not adequately satiate the will for progress in new terms, will fail to persuade the people it needs most.

Continuing growth depends on continued exploitation and accumulation of capital in the hands of a minority at the expense of an overwhelming majority – what David Harvey describes as “accumulation by dispossession”.¹² Nitzan and Bichler’s “Capital as Power” framework pushes this further. In their analysis, capital is not a productive input at all, but a quantification of organised power, and accumulation is fundamentally about differential advantage over others rather than absolute wealth creation. Dominant capital groups do not simply benefit from growth. They actively sabotage alternatives that threaten their relative position, what they call “strategic sabotage”.¹³

This maps onto the dynamics of capital flight and investment strike described earlier. Resistance to post-growth transitions is as much a defence of profit as it is a defence of the metric by which power itself is measured. It is based on gendered exploitation and devalues reproduction, and the vital care work on which any market economy depends. Both are overwhelmingly carried out by women (particularly in the Global South), and remain systemically sidelined. Depending on the method of calculation, this work represents between 30 to 70 percent of a country’s economic output.¹⁴

Modern industrial development, regardless of ownership model, has become authoritarian, alienating, and restrictive of self-determination. As Andre Gorz wrote in 1985, the fact that industrialism is common to capitalism and socialism illustrates the power and scope of the concept.¹⁵ From a global justice perspective, “growth” and “development” are 20th century inventions that create and maintain neo-colonial dependencies, reducing countries of the Global South to material suppliers without large value gains, reinforcing asymmetric power dynamics on which modern Global North quality of life depends. Immanuel Wallerstein’s “World-Systems theory” builds on this further, arguing that the global economy is not a collection of independent national economies at different stages of development. It is a single system with a core, a periphery, and a semi-periphery, in which the periphery is structurally required for the core to function. The promise that all nations can “develop” simultaneously is a contradiction in terms, because the system depends on unequal exchange to reproduce itself.¹⁶

And finally, “green-growth” in practice is built on a flawed understanding of long-term thermodynamic rebound effects. Brockway et al. find that there is little evidence or precedent for absolute decoupling of emissions and energy use from GDP growth, that global trends are going in the opposite direction, and that overlooked efficiency rebound effects may erode more than half of expected energy savings.¹⁷ Timothee Parrique’s “Decoupling Debunked” report similarly finds that decoupling at a rate consistent with Paris Agreement emissions trajectories seems unlikely, given the lack of accounting for the role economic growth plays in production, biophysical throughput, and associated emissions,¹⁸ and that even if decoupling did begin to happen, we could not in any scenario decouple fast enough to limit warming to Paris Agreement levels.

Growth provides the theoretical consent for certain kinds of limited and limiting profit-oriented politics. It is an emergent hegemonic structure and process shaped by intertwined dynamics of political economy, ideology, and militarisation. It is about power. Governments legitimise themselves by promising growth, corporations depend on it for profit, and superpowers treat GDP as a proxy for geopolitical clout. Decades of propaganda have made perpetual growth appear natural, necessary, even unquestionable – a common sense backed by institutions and ideas that mask its contradictions. As a result, the paradigm self-perpetuates, written into election platforms, development policies, and security strategies worldwide. Those sounding the alarm are dismissed as idealists.

Deconstructing growth means exposing it as a political construct. One that serves specific interests and is enforced through global institutions and military might. Nations use access to markets and resources (and the threat of force) to maintain growth at home, from colonial extraction to twin-deficit-fuelled U.S hegemony. Any serious attempt at any kind of truly sustainable transition, therefore, directly challenges entrenched power structures.

In short, moving beyond growth is inherently subversive. It strikes at the heart of a global system built on competition, accumulation, and the politics of progress. This is why a post-growth vision will be fiercely resisted by those who profit most from the status quo, unless we preempt and counter that resistance by building new systems that can survive this process.

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Notes

1. Woodward, D. (2015). ‘Incrementum ad Absurdum: Global Growth, Inequality and Poverty Eradication in a Carbon-Constrained World’. World Economic Review, 2015(4), pp. 43-62. The 207-year figure was popularised by Hickel, J. (2017). The Divide: A Brief Guide to Global Inequality and its Solutions. London: Windmill Books. See also Hickel, J. (2015). ‘It will take 100 years for the world’s poorest people to earn $1.25 a day’. The Guardian, 30 March.

2. Polanyi, K. (1944). The Great Transformation: The Political and Economic Origins of Our Time. New York: Farrar & Rinehart.

3. Daly, H.E. (1977). Steady-State Economics. San Francisco: W.H. Freeman. See also Daly, H.E. (1992). Steady-State Economics (2nd ed.). Washington, DC: Island Press.

4. Manheim, D. and Sandberg, A. (2021). ‘What is the Upper Limit of Value?’. Preprint, Future of Humanity Institute, Oxford University. Available at: https://philarchive.org/archive/MANWIT-6

5. Arthur, W.B. (2015). Complexity and the Economy. Oxford: Oxford University Press. See also Beinhocker, E.D. (2006). The Origin of Wealth: Evolution, Complexity, and the Radical Remaking of Economics. London: Random House Business.

6. Jakab, Z. and Kumhof, M. (2015). ‘Banks are not intermediaries of loanable funds -- and why this matters’. Bank of England Working Paper No. 529.

7. Jackson, T. and Victor, P.A. (2015). ‘Does credit create a “growth imperative”? A quasi-stationary economy with interest-bearing debt’. Ecological Economics, 120, pp. 32-48.

8. Costanza, R. et al. (1997). ‘The value of the world’s ecosystem services and natural capital’. Nature, 387, pp. 253-260.

9. Daly, H.E. (1999). Beyond Growth: The Economics of Sustainable Development. Boston: Beacon Press.

10. Easterlin, R. (1974). ‘Does Economic Growth Improve the Human Lot? Some Empirical Evidence’, in David, P.A. and Reder, M.W. (eds.) Nations and Households in Economic Growth. New York: Academic Press.

11. Graeber, D. (2018). Bullshit Jobs: A Theory. London: Allen Lane.

12. Harvey, D. (2003). The New Imperialism. Oxford: Oxford University Press.

13. Nitzan, J. and Bichler, S. (2009). Capital as Power: A Study of Order and Creorder. London: Routledge.

14. Schmelzer, M., Vansintjan, A. and Vetter, A. (2022). The Future is Degrowth: A Guide to a World Beyond Capitalism. London: Verso.

15. Gorz, A. (1985). Paths to Paradise: On the Liberation from Work. London: Pluto Press.

16. Wallerstein, I. (2004). World-Systems Analysis: An Introduction. Durham: Duke University Press.

17. Brockway, P.E., Sorrell, S., Semieniuk, G., Heun, M.K. and Court, V. (2021). ‘Energy effi ciency and economy-wide rebound eff ects: A review of the evidence and its implications’. Renewable and Sustainable Energy Reviews, 141.

18. Parrique, T. et al. (2019). Decoupling Debunked: Evidence and arguments against green growth as a sole strategy for sustainability. Brussels: European Environmental Bureau.

In this conversation, Cecilie talks about walking this unchartered path and applying her insights in different contexts, from an international perspective to that of her own local neighbourhood and wider friendship groups. Key to both: Starting from people’s actual needs.

Below the video, you can read the interview based on the transcript, edited for clarity and additional information. If you’d like to learn more about Cecilie’s work, feel free to get in touch with her directly or contact us.

Summary

Cecilie Smith-Christensen is a Norwegian economist who for more than 25 years has worked to support sustainable development through the cultural heritage and tourism domains. The potential of cultures has been a central theme in her work as an entrepreneur and founder of Events Research South Africa, deputy director of the Nordic World Heritage Foundation, expert advisor to UNESCO’s World Heritage Sustainable Tourism programme, and independent consultant.

In 2014, Cecilie founded World Heritage Catalysis, which, focusing on the protection and management of natural and cultural heritage commons in the context of tourism, aims to enhance transformative change and resilience within tourism-dependent communities around the world.

Recently diagnosed with terminal cancer, she is exploring through the ResiliNets initiative how collaborative finance and mutual aid could help build networked resilience based on personal needs and care for dependants.

In the interview, Cecilie looks back at her childhood, upbringing and work experiences, reflecting on how exposure to different countries and cultures has influenced her professional and personal journey.

Interview based on the transcript

Katja: Today I am talking to Cecilie Smith-Christensen. She is an economist and has worked in the heritage and tourism domains for many years, with a specific focus on World Heritage. In 2014 she founded World Heritage Catalysis which, oriented towards commons practices, aims to transform tourism with innovative approaches and tools to build community resilience.

Hi Cecilie, welcome.

Cecilie: Thank you so much, Katja. Great to see you.

Katja: There are two main topics we want to talk about today. One is your career in heritage protection and tourism, and also how you realised there is a need to reorient practice, because tourism, as we probably all know, can be quite damaging to the host. The second one is a personal project that came out of a drastic change in your life. You have been diagnosed with cancer.

But there are also links between the two, as we will see, so you are building on what you did in your work for your personal project.

A career in heritage protection and sustainable tourism

Maybe let's start with your background. You were born in Kenya and then moved to Norway, and after studying economics, you moved around to quite a few places. You did an internship at UNESCO in Paris, and you also spent several years in Cape Town. And you once did a tour from Cape to Cape, from the North Cape in Norway to Cape Town. I found that really amazing. How long did that take you?

Cecilie: Thank you for sharing that timeline Katja. It took half a year. In addition was the time planning, of course. Life’s a journey. Looking at my privileged and exciting life, it’s interesting to reflect on the motivations and the questions that have driven me to the next phase of my life and the exposure that I’ve sought.

I was born in Kenya, to Norwegian parents, but grew up on a small farm in Norway until my parents divorced and I moved to the city (Oslo). My early years journey made me very aware that the starting point of your life is very significant for later opportunities. I hope it has brought a sort of humbleness to me, as it was not a given that I would be raised and grow up in Norway - a country I find somewhat detached from the great societal challenges we see around the world.

Naturally influenced by my parents - my father a pilot and adventurer while my mother more into arts and culture, I developed an interest in how culture varies around the world, how it influences communities, and drive development. However, in the early 1990s there were no formal study opportunities on the role of tourism in sustainable development. So instead, and in order to later pursue my interests, I decided to study economics at the University of Oslo. That took seven years of my life.

Once I got the degree in 1999, I realised it was time to explore the world. In 2000 I did the Cape to Cape expedition with three friends. Our road trip from Cape Point in South Africa through Africa, the Middle East and Europe up to North Cape in Norway, was a wild trip. What was really interesting was travelling metre by metre – and not just flying in and thinking you get an understanding of a place – seeing how people actually live. You know, many people refer to ‘Africa’ as if it was one country, but it is so diverse.

Katja: Yes, it is always mentioned as one thing, but it is so many different countries.

Cecilie: Meeting and talking to people along the route and not doing the luxury kind of touring was also humbling.

Once I came back to Norway, I got an internship at UNESCO - United Nations organisation for Education, Science and Culture, at its headquarter in Paris. I was lucky to be there for four months, very important months for me gaining experience of UNESCOs World Heritage Convention (1972). Upon the rather unrealistic dream of becoming an expert advisor to UNESCO, the recommendation was to get more international experience. My mother always says, if you aim for the stars you may be lucky to reach a bit over the bushes…

Katja: Aim high.

Cecilie: I followed the advice and went to South Africa seeking international experience. I had lectured there for half a year in 1998, but when I went back there in 2001, I ended up staying for seven years. During this period and after a year as a beach-bum in surfers paradise Jeffreys Bay, I moved to Cape Town. At a conference on Responsible Tourism I met wonderful people with whom I co-founded Events Research South Africa – a consulting company addressing events and festivals’ contribution to sustainable development. This was in the time of post-apartheid and the aspiration of building an inclusive ‘rainbow nation’. For me that was an amazing time and experience, being able to roam around in different sub-communities asking questions . I learned a lot about not assuming things about “communities”, the diversity and the richness which exists across all layers.

Anyhow, in 2008 I moved back to Norway, starting a new chapter as deputy director of the Nordic World Heritage Foundation – a UNESCO Category 2 Centre based in Oslo. In that role, I got the opportunity to assist the development of UNESCO’s World Heritage Sustainable Tourism Programme and tools supporting the development of sustainable tourism strategies. Under the UNESCO programme and while most of my work is conducted online, I have been privileged with the opportunity to travel, assisting the development of tourism strategies around UNESCO World Heritage sites.

I want to say something about the UNESCO World Heritage Convention - the International Convention concerning the Protection of the World Natural and Cultural heritage of Outstanding Universal Value aiming to protect our shared heritage. Many of these places are significant tourism attractions. While these places are inscribed on the World Heritage list because of their heritage value, there is also a great motivation among State Parties to inscribe places because of the international recognition and tourism that often comes with it.

And as you initially said, tourism is an economic driver. It's massive. Under the Sustainable Development Goals it's been strongly pushed as a sector that can contribute development through economic growth. However, we now see many places struggling under mass tourism, over-tourism, exploitation, and commercialisation. This is the context for which I have seen the need to reorient practice.

Katja: What problems would you say you have been trying to solve as you oriented your career more towards changing something? Even though it is called sustainable tourism, it still has the growth driver in it, right? Is that something you started to see?

Cecilie: In the aspiration to shift from an extractive to a non-extractive and ideally regenerative development paradigm, how we address our resources is very important. Natural and cultural heritage are often referred to as economic resources, presented for what they could mean for the economy or for people.

What is quite disruptive, I would say, is when you start recognising that many of these ‘resources’ are in fact commons. And when you apply the commons approach recognising the shared right to and responsibilities for the stewardship of nature and culture, it also helps addressing what is problematic about seeing and managing heritage as proprietary and economic resources.

Language has however tied us to the increased privatisation of property and extractive economics. For me and many professionals, the UN Sustainable Development Goals have been the context guiding practice. Around the SDG 8 on economic growth, we have created a language where almost everything we do is somehow tied up in the narrative that economic growth contributes to sustainable development. But to me, over time that narrative and what I observed did not make sense, leading to increased cognitive dissonance. Most organisations do however not invite or even allow for critical questions around the role of economic growth and sustainability. Then, how can you start asking questions necessary to identify the matter, and address the cognitive dissonance? I had conversations with colleagues, airing this, and many said, “Yeah, totally agree, but we don’t see the opportunity to address it.”

Conversations have however changed over time, and specifically after reading the Deep Adaptation paper.

Katja: Yes, Jem Bendell, 2018.

Cecilie: Yes, exactly. Actually, I found my way to Jem because of his work in complementary currencies. I had the opportunity to meet him and also for a while studying under him. The Deep Adaptation paper was really important, because it burst that bubble. With the COVID pandemic, it was like: ‘This is it’.

Katja: We can’t carry on like that.

Cecilie: Yes, the Deep Adaptation paper provided a starting point for improved language, and ways to frame the predicaments.

We are operating under, not only disruptions, but a decline in systems and organisations we believe hold our communities and the world together. Deep Adaptation helped me become more articulate about systems collapse and the need for transformative change. It was also an entry point to learn about the various individuals and clusters of people now coming together to really address systemic issues.

It has been a steep learning curve for me. It’s not only about learning, it’s very much about unlearning and learning again.

I needed time to find out how I bring this changed understanding of the world to relevance through innovation in the context of heritage and tourism. So, again travelling down an uncharted path, I needed to find that out for myself through ongoing reflections. In this process I navigated and learned from international communities of domains including heritage and tourism, but also economics as a broader domain including CoFi [collaborative finance]. By moving between the various professional domains, I now feel different narratives and approaches are merging into new more meaningful narratives guiding practice. What is emerging is a result of people connecting through conversations, addressing needs in the context of communities or places, instead of the needs of an economic sector.

Work I currently engage in involves the formulation of international charters, steering documents and tools hopefully influencing practice going forward. This includes ICOMOS International Charter on Cultural Heritage Tourism (2022) reinforcing cultural heritage protection and community resilience through responsible and sustainable tourism management. The Charter represents a rather radical contribution as it calls out the unsustainability of the current economic paradigm requiring perpetual economic growth, and by addressing heritage as commons it sets out a potential transformative pathway for tourism. This is an important international charter as the International Council on Monuments and Sites (ICOMOS) is an Advisory Body to UNESCO and the World Heritage Convention.

So, coming back to your question; Instead of ‘how can tourism contribute to sustainable development’ which through economic growth in the context of climate change leads to increasing vulnerability, my focus is now ‘how can we or I help enhance the resilience of tourism-dependent communities’. This is where futures thinking and anticipatory approaches come in. What happens within a community upon a disruption, and how can we prepare in advance?

It is increasingly clear that across the world many places need to deal with this vulnerability, but there are very few tools or approaches to do so. These issues are not solved through energy efficiency only, but how we as individuals connect and help each other.

Katja: How much of a role does it play to keep the economy local as well, and maybe reduce the extraction towards the wider economy?

Cecilie: Tourism is multifaceted. Because of international ownership, money is leaking from the local economy. Even if we like to talk about sustainable and responsible tourism, there are a number of systemic issues we keep ignoring. The reality is that tourism often leads to extraction and gentrification. Nevertheless, I see the tourism sector as an interesting opportunity to help localise economies, and through the tourism sector supporting local production and local consumption. It is not just about the tourists. We need to think about this very systemically, and from a local community perspective. If a place is not a good place for the local people to live, it won’t be a good place to visit. Revenues from tourism depend on a community’s ability to attract and host visitors. We need, through economics, to build communities that are robust to fluctuations in visitor numbers and disruptions that may affect the tourism sector. Even the scenario where a community is no longer attractive or able to host tourists.

It’s not about abandoning tourism entirely, but we need a form of economy that – I’m a bit cautious using the term “regeneration” – literally sustains life locally. I’m thinking about water security, soil security, food security, housing security - challenges where it’s very interesting to see potential approaches addressed through the commons and collaborative economics and finance approaches.

Katja: I was just going to mention, we actually met at the last CoFi gathering. Do you think something like complimentary currencies or alternative economic models will have a role to play as well?

Cecilie: I hope so.

Katja: Can you see that starting anywhere?

Cecilie: Yes, however not yet so much. You have the CopenPay in Copenhagen, Denmark, incentivising and rewarding tourists for thoughtful actions is a good example. But the CoFi – if I may call it a movement – it holds space for so many innovative approaches. It’s not ‘one system fits all’, but it’s about getting a broader understanding of what economics is and what economic tools can do to complement, and maybe help rectify shortcomings of the current neoclassical economies and fiat-based monetary system.

I’m very encouraged to see innovative approaches addressing energy, housing, and farming. I am also specifically interested in credit clearing – what LocalLoop Merseyside are doing – and Grassroots Economics commitment pooling. To me, it’s about how we could bring different approaches and initiatives to relevance avoiding competition because of limited official budgets. I hope to play a role in contextualising the potential of these types of innovations and support collaboration around piloting and implementation. We must however be very careful attempting ‘social engineering’ through behavioural modification as without rooting it in local needs and values may lead to unexpected consequences.

Katja: It should be the people themselves doing the social engineering. I think that’s important as well, wouldn’t you say? So that it’s not something from outside.

Cecilie: Absolutely. You know, the tokenisation of this and that, tokenising forest, tokenising heritage may be good for fundraising. But we need to consider financial innovation within a broader scope - the potential for systemic change and paradigm shift, and not only how to generate more money for certain projects.

The question is how we can support individuals in their collaborative economic capacity to share and utilise resources in a respectful and sustainable way. On this note, I trust you will bring me to the point of the ‘commons’.

Katja: Yes, there was one specific question, and after that, we can maybe move on to ResiliNets.

Commoning is all about inclusivity, but it seems like in the commons movement, there’s not that many women who are really well known or driving things, and also not in the CoFi movement. Why do you think that is?

Cecilie: Women were always engaged in commoning but maybe not reflected in the language as ‘now what we’re doing is commoning’. Many of the thought leaders in the commons space are men, and they are writing wonderful things making sense. But I think we, possibly due to the limitations of language and vocabulary, have somehow forgotten that commoning is something that we have always done. We therefore really need to make sure that commoning is broad enough to encompass all the commoning that has always been going on.

And this is where knowledge about our history and heritage is important, because it was largely through commoning we survived and flourished in the past. We need to look back, recognise and bring what may have been forgotten or marginalised into contemporary relevance, even if we have all sorts of technologies now. I often say when I am exposed to a new kind of tool: “what happens when the electricity goes down?”

Katja: Is it like that: we have always been doing commoning and have not necessarily needed to put that into language and talk about it in economic terms? And now it is in some areas seen as this economic tool as well? Where am I going with this?

Cecilie: I think it is important as it helps us to understand that what we are doing by default is extractive.

Katja: The current default that we have?

Cecilie: Yes, the current default. Operating in a debt-based economy, even if my intentions are good, I am stuck in this paradigm. How can I find the way out? What is the paradigm shift, and what do I need to do in order to break out?

This is my working hypothesis and proposal: while tourism can be restorative or generative, it is only through decoupling from the debt-based economy, we may shift and contribute towards a regenerative paradigm. This requires tooling that helps us facilitate types of exchanges not possible by fiat money. This involves a mind-shift but is also very practical.

Katja: Is it that we need to take things out of the money system altogether and also do a different type of finance that is more about circulating and not taking on ever more debt?

Cecilie: We can’t say “now you need to shift from this model to another”.

Katja: To have an awareness that that is what we want to do is probably a first step.

Cecilie: I think it’s necessary to recognise our shared vulnerability and understand that the type of money enabling the current economy does not serve us in the long run, and may not always be there. Suddenly, upon a disruption we may be without income and money, and what do we have then?

In Norway, the government may channel funds to local places affected by a disruption affecting the local economy such as the tourism sector, but that’s not possible everywhere. If a remote tourism place suddenly doesn’t have any tourists, or wakes up to the realisation of this being a potential scenario, what then? How can we prepare? Are there complementary mechanisms that could help diversify the local economy and make it more robust towards economic disruptions? However, we are all doing our best, and not everyone can imagine or drive a radical paradigm shift. But we can all start to address collective and individual needs.

ResiliNets

Katja: Let’s talk about ResiliNets. That’s your personal project. How did you get the idea for it, and what is it?

Cecilie: Thank you. Actually, ResiliNets was first conceived through World Heritage Catalysis as an initiative with the aim to enhance networked resilience, and specifically around tourism dependent and vulnerable communities. It has however evolved upon my more recent situation.

When I was diagnosed with terminal cancer in December 2025, it came as a shock, naturally. I am a single mother, and my daughter, who is turning thirteen on Monday, is still young. So, upon that realisation that I don’t have time ahead, my immediate reaction was: ‘This is shit, but let’s make the most out of it. I’m still alive, I’m engaged in what I’m passionate about, but now I need to get my priorities right.’ I also realised that I can’t continue to travel around the world with the hope and intention to “save the world” and implement complementary currencies in remote communities.

Upon experiencing new needs I therefore asked myself: How do I start to build from myself? That was actually a very interesting challenge, because in the past I always thought that efforts to enhance community resilience here in Norway is difficult because I and many live privileged lives in relatively affluent communities. I have great neighbours, and while we have concern for each other, we generally engage upon the ideal of “self sufficiency” ignoring our relational dependency.

Katja: Yes, that’s what the current economy is like.

Cecilie: Exactly. In the past I thought it would be very difficult to integrate or even bring these ideas forward in my own local context, because we don’t necessarily see how vulnerable we are, we are not ready to take that in. So, when I got sick I decided to be very open from the beginning about my situation, my personal needs, the needs of my daughter and mother as my dependents, and our dependency on friends and family.

Katja: Yes, I really admire you for how you communicated it, and also how you are dealing with it now.

Cecilie: Thank you. In the process of communicating my situation I also reflected upon the fact that each of us represents a node in a greater network, and what may happen if a node in a network goes away. It is a disruption. People are disconnected. They don’t only lose a person but also lose connectedness. I found my own passing as a disruption in society very interesting.

In December, I wasn't sure I would survive till summer. Undergoing and responding well to the chemo treatment I now hope to have more time. However, irrespective of time I see the need to build and strengthen my network. I strongly feel the need to find ways we can come together, and enhance networks not only around me, but also my daughter, mother, and greater network of family and friends. A network that will continue beyond my time and as my social legacy.

As I did not have the energy to respond to the many kind questions on how my treatment is going, my first effort was to create a WhatsApp group for my Norwegian family and friends as a forum to share reflections about life with the occasional health update. Quickly the group totalled 105 people. As an introvert I didn’t previously realise I had so many friends. It’s a playful space, now engaging a lot of people so it’s really a big ego boost. It’s fantastic.

But what’s possible to mobilise through a WhatsApp group is very limited and restrictive to what I hope to accommodate. So it was actually thanks to you that I learned about HumHub, which is an open source community platform that I now use to build what I call ResiliNets, #FriendsofCecilie. With this I aim to develop an inclusive digital space where my broader set of friends and family can connect and engage around shared interests building community around my daughter and themselves.

Next was recognising and being vocal about personal needs. While I love flowers, I don’t like to see flowers dying in front of me. I would however appreciate help with cooking, and home-baked healthy bread. I would also appreciate help with my shortcomings, for example if my daughter is stuck with homework or my elderly mother needs help. Recognising my own needs and wants spurred an increased interest in mutual aid and reciprocity networks.

Many mutual aid networks start with what a person has to offer. Exposing one’s needs, it’s more – I wouldn’t call it taboo, but less practised. From my own experience living abroad – if you’re not needed, you feel very disconnected even if you live in a so-called ‘community’. Therefore I decided, ‘okay right now I need to somehow go forward with an example around my needs’. Next, ‘how can I somehow support the practice of reciprocity through mechanisms making it fun?’

As part of ResiliNets (which is still under development), I want to integrate a mutuality and offers-and-needs market, engaging with people within the CoFi network offering and evolving relevant technologies. Meanwhile I am playing around with the use of vouchers. For instance, upon expressing my needs, and if someone responds to any of my needs, issuing a simple voucher can be a way of expressing appreciation. Through a voucher I can say, “Thank you so much for what you offered”, and in return, I can offer to borrow a book or use my sewing machine. I have a lot of tools. Before I invite my friends and family into an offer and needs market platform, I want to bring a bit of playfulness through the use of vouchers as many people are not aware of or used to these types of practices, and hence need a soft introduction to new ways of sharing and reciprocal networks.

Even for those not seeing the need for it now, let’s start to play with reciprocity and make it fun. The doomster in me thinks that we all can prepare by playing a bit, knowing that in times of greater needs there are tools out there.

Katja: As I understand it, your local network is already quite active now, right, and now you’re extending it more towards your global network.

Cecilie: Yes, of course. Through ResiliNets I hope to connect my international network of friends - #FriendsofCecilie.

Katja: Before we went on this live call, you showed me a bit of the platform and we were thinking, you could show that a bit here as well, so people can get an idea.

Cecilie: Yes, thank you, that’s very exciting. This is really work in progress, and so I am just showing you the entry. This is ‘Welcome to ResiliNets’, a space where I invite friends and family to join across generations.

Currently under development, it is a bit overwhelming, but here are examples of spaces on themes where I would like to engage with my friends and family. I also have my own space – Cecilie’s space – taking over the WhatsApp group where I will continue to share my thinking and reflections and just being me. I also created a safe space for my daughter Lucie. But primarily it offers opportunities for shared engagement. For instance, share your favourite book and film, with the potential of hosting a little virtual book club. The same goes for cooking and recipes. While I will share delicious mocktails, my mother will share her signature dishes, and I will invite my friends to share healthy meals. There will be spaces on culture and creativity, gardening and other themes. This summer I will invite people to virtual gym classes.

Last Sunday, I had an open invitation to come and help me create the dream garden. People who hadn’t previously met came together around production rather than consumption, leading to the most wonderful result. Next week I will be organising a clothing swap using vouchers. That will be fun.

ResiliNets is however not set up with the ambition for everyone to join. First of all it connects me to my immediate and broader network of friends and family – hence #FriendsofCecilie as their shared point of reference. If it can help my distributed network of friends and family to connect with and support each other – to meet around co-creation rather than consumption, I have achieved my goal.

Katja: I remember we went to an event where that came up as well – about doing productive things together. Often we consume things together. We go to the cinema, or we buy things. To come together and do something together is probably something that is good to do more.

Cecilie: So, that’s the idea.

Besides thematic spaces to connect personally and virtually, I also plan a space on travelling and hospitality with the aim to connect friends from around the world - including you and people I have befriended through the Cofi network. In the future if you ever come to Norway, you could reach out through ResiliNets finding other #FriendsofCecilie that can help you plan your trip and even meet up for a coffee or help with accommodation. Or, if you have children who are going to a foreign country, you could reach out to this personal community, and find people that should be ready to be a local connection and provide help if necessary.

Building resilient networks from oneself is something everyone could do. Thinking very practically around my own needs, wants and desires, and how I may build community and networked resilience, I hope my lived example could inspire others who may be in similar situations, as a social legacy, support dependants, friends and family after someone is gone. It could even come to relevance in the tourism-dependent communities I for years have attempted to support, but as an outsider.

Together we stand stronger.

Katja: Yes, I see ResiliNets becoming a network of your friends, friends that also care for your daughter.

Cecilie: Friendships to me do not only include people I grew up with, or see regularly. Friends are people that I had honest conversations with. Honest conversations build trust through openness, transparency, and respect. Engaging with people in the CoFi movement, engaging in deep conversations around things that really matter to us, has created human bonds and expanded my network of people I trust will respond positively at our next encounter.

Katja: I also remember us going on the train with Sue Bell, we had such good conversations.

Cecilie: Yes, and I also want to acknowledge your hospitality. Staying with you and your family was really nice.

Katja: Yes, we had such a nice time. And then we went to London as well, and we played the money game with Jem Bendell and Matthew Slater.

Thank you so much for sharing that, and I’m looking forward to seeing the network grow. Is there a place where people can learn about that?

Cecilie: I welcome those interested in the potential of commoning and CoFi in the context of heritage and tourism, or ResiliNets to connect. As emergent practices I’m open for collaboration, and will continue to engage in various ways as long as possible. I’m very glad that technology allows us to collaborate and co-create, even if we are not in the same location. That’s really amazing.

Thank you so much for the opportunity to take so much space and time.

Katja: It’s been really interesting, and I know others will think that, too. It’s so valuable. Thank you.

Cecilie: Thank you so much.

This article is adapted and expanded from a knowledge base entry written by Matthew Slater. The Growing the Commons knowledge base is a community-curated collection of concepts, projects, and ideas related to commons-based approaches and systems change.

We have preserved much of Matthew’s original language and argument while adding editorial context, a short introduction to Collaborative Finance and its underlying principles, selected examples, and a fuller invitation to the upcoming CoFi4 gathering in Austria (21-28 June 2026).

Why traditional finance goes awry

The commons movement is a backlash to the idea of private property, in which ownership of land and other assets is exclusive, which gradually splits society into classes of owners and of the dispossessed. But ownership is just a part of the problem.

Collaborative Finance addresses another dimension of the problem, which is how the money and financial system puts the state, its institutions and its plutocrats between people struggling to make a living, skimming and confiscating their resources at every turn.

Let’s consider some common, even essential, financial instruments:

• Insurance

• Pensions and unemployment benefits

• Loans and mortgages

• Saving and investment

• Payments

The smooth and fair operation of these mechanisms is critical because their failure ruins lives. Stringent regulation helps to protect against fraud and failure, but also to obstruct small players and innovators. Maybe this is fair – when it comes to risk management, the larger institutions can juggle more assets and cope with larger hazards.

But this also leads to the financial sector being owned and run exclusively by the ruling class. Those elites can evade these regulations because they can afford specialist accountants and access tax havens. The products and tools are arcane and difficult for the government to regulate. Revolving doors, corruption and other mechanisms compromise the regulatory system. Despite all the government protection, violent speculative cycles, scams and abuses still happen, and justice fails to catch up. The largest institutions are often the most prolific criminals, and in some ways hold sway over government itself.

Meanwhile, for most of us, the financial services we use have become like indifferent machines: algorithms decide if we are creditworthy; our pensions are used to finance polluting industries and war-criminal governments; we struggle to keep our data from predators and time-wasters. We watch all the money slipping through our fingers and being collected in enormous pools which overflow with riches we may never enjoy.

What if?

Being organised at such a large scale ensures that only remote rich people design these systems and derive all the secondary benefits. But what if there was a more appropriate scale, in which trust actually played a role, in which profit was not the prime directive but was ploughed back into the system? In which the people taking risks helped to manage those risks?

What if the so-called free market had space for small-scale financial services – like house and car insurance in every street? What if pensions were managed by the local government which, after all, is the main provider of elderly care? What if we could invest in the very businesses that produce and sell our necessities, as a way of ensuring our own security? What if those businesses turned around and invested in us, making our security mutual? And what if this myriad of local human financial organisations could de-risk through voluntary federation?

One of the first assumptions we need to unpack is about the role of money itself, the thing that integrates all our activities with the dominant financial machine and makes each of us part of the problem. Money is really good for standardising accounting, taxation and fines, but it is quite hard to obtain and hold on to. Maybe if we could enter into different kinds of financial relationships, we could find other ways to settle debt, to account for exchange, and to provide for the future.

Because money, it turns out, is not where finance begins. Finance precedes money. Long before banks, markets, or coins, people pooled resources, shared risks, settled obligations, and invested together in a common future.

What is Collaborative Finance?

Collaborative Finance, often shortened to CoFi, is not a single organisation, technology, ideology, or mechanism. It is an emerging field and community of practice exploring how communities can create, run, and govern their own financial systems, services, currencies, and instruments – collaboratively, and for themselves.

That one idea stretches across all the major financial functions: not just exchange and payments, but also saving, lending, credit, insurance, and investment. What unites them under a single umbrella is a shared answer to one question: who finance is by and for. In CoFi, the answer is the community itself – the people who actually use the system.

The motivations vary. Sometimes the aim is to reduce dependence on scarce cash, letting members trade even when money is tight. Sometimes it is to keep value circulating locally instead of leaking away to distant shareholders. Sometimes it is to give smaller players the bargaining power that comes from acting together, to share risks that no one could carry alone, or to finance the things that banks and governments will not.

Many of the approaches explored within CoFi are far from new. They draw on practices that are often centuries old and found the world over (see What does CoFi look like in practice? below for specific examples). What is genuinely new is the opportunity to connect these traditions across countries and sectors, to learn from one another, and to build shared tools using recent technological advances.

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What makes CoFi different?

Mainstream finance is optimised to maximise profit for the owners by maximising revenue from the customers, at least as far as the cartel allows. The benefits of doing it another way, then, are everything but maximal revenue! Instead finance done collaboratively between peers should be less fearful, more flexible and less legalistic; more fun, more participative, more considerate of the environment and community. It should build social bonds and provide more non-monetary and serendipitous returns.

Several principles recur across the field:

• It treats money as a social relation, not a commodity or thing: when we treat money as an object, we forget that it is always, at bottom, based on social agreement – a negotiable relationship of credit, trust, and obligation. The question is not what tokens circulate, but what relationships and responsibilities sit behind them. CoFi also prioritises money’s role as a means of exchange – keeping value moving through a community – over its role as a store of value to be accumulated.

• It serves the real economy: the point is not to create assets for speculation, but to support the people and organisations producing real goods, services, care, infrastructure, and ecological value.

• It treats trust as something to be nurtured, not eliminated: some technologies try to make finance “trustless.” CoFi does the opposite, seeing trust as the solid foundation on which effective finance can be built. It leverages the trust that already exists between people who know one another, then devises ways to extend and reinforce it over time.

• It assumes different tools serve different purposes: a mechanism designed for local exchange tends to be unsuitable for long-term savings and community funding. CoFi therefore doesn’t seek a single universal solution, but promotes a plural ecosystem of interacting tools, instruments, mechanisms and services, each serving a specific purpose.

• It scales not through consolidation, but federation: CoFi starts with individual communities – often small, usually grassroots. Scale comes not from one network absorbing the rest, but from many independent, self-governing systems choosing to connect and interact on shared terms. Each stays sovereign over its own rules, but expands its reach through federation.

Put simply, collaboration comes before finance. Financial tools can support cooperation, but they cannot substitute for it. Communities need relationships, trust and shared purpose before any mechanism can succeed.

What does CoFi look like in practice?

CoFi takes many forms. Most practitioners are less attached to any one mechanism than to the question of how these approaches can complement one another to support resilient local economies. Some of the main families are:

• Mutual credit: participants extend each other credit within a network, trading even when cash is short, with the network itself acting as the source of liquidity. This family includes Local Exchange Trading Systems (LETS), time banks, and business-to-business barter exchanges. Examples include Sardex in Sardinia, the government-supported Fureai kippu care-time system in Japan, and the global Community Exchange System (CES).

• Community and local currencies: money designed to circulate within a particular place or community, often with additional social and environmental goals. Examples include Brazil’s Banco Palmas and its social currency, the Palmas (now part of a network of over a hundred community banks), and the Chiemgauer regional currency in Germany.

• Multilateral clearing: businesses cancel out what they owe one another within a network, settling only the net balance and freeing up scarce cash. Examples include Local Loop Merseyside in Liverpool and the global Cycles network.

• Voucher and use-credit systems: businesses or producers finance themselves by issuing prepaid vouchers that can be redeemed against their own future goods or services. Classic cases are Deli Dollars and Berkshire Farm Preserve Notes in Massachusetts, USA.

• Savings circles and rotating credit associations (ROSCAs): members pool their money and take turns drawing on the pot, under rules they set themselves. Examples include kin.coop in the UK and the Sarafu Network in Kenya (which combines several mechanisms including mutual credit and community currencies).

• Community investment: residents collectively finance shared assets such as housing, renewable energy, shops, or pubs, keeping ownership and returns local. In the UK alone, for example, community shares have funded hundreds of such projects over the last two decades.

• Mutual insurance: participants collectively share risks among themselves rather than outsourcing them entirely to commercial insurers, much as the original friendly societies and tontines once did.

What can I do?

Finance is always a shared activity – you can’t do it on your own! But you can start by deprogramming yourself from deep cultural indoctrination. Reflect on what these words really mean:

• Money is a means, not an end in itself.

• Value is what you value, not the market.

• Work is the creation of wealth for yourself or for your community.

• Wealth is not the balance of your bank account but the quality of your life, your health and your relationships.

• Security is emotional and relational, not just physical or material.

With this grounding you can work with others to create wealth and security together. Building large-scale, trustworthy institutions from scratch takes years or even decades of patience, yet commoners have achieved it many times before. Building societies took hold and thrived amongst the urban poor of the Industrial Revolution; savings pools can be found in nearly all the monetised societies of the world; the Mondragon Coop still dominates a whole region of Spain.

But we also have to be realistic about the obstacles. Most people are very conservative with their money and the incumbent system is the devil they know: it is more or less predictable, and highly efficient. By contrast, collaborative finance is often built around potentially less familiar assets and relationships. A young CoFi initiative has many ways to fail and potentially lose its members’ assets. For this reason it is important not to put all one’s eggs in a single CoFi basket.

There is also a lot of churn in this field. Many projects fail to get off the ground, often for governance or personality problems, and if successful, there is always the danger of being co-opted and the temptation to sell out. The other great challenge is finding each other and building real, trusting relationships. The people who are awake to the menace of the financial system are thinly spread, often use different language for similar ideas (or vice versa), and don’t always recognise each other as natural allies. This makes it harder for them to meet, to associate, to build trust and to develop lasting institutions.

So building a more collaborative financial system can only happen gradually, cautiously, even if you feel the need for it painfully urgently. And even if you never fully achieve the ideal, the process itself should be immensely valuable for building trust and community around you.

Join us at the CoFi 4 gathering in Austria (21–28 June 2026)

CoFi is also a thriving community! Every summer, people from across the field gather in the picturesque Austrian Alps to meet, compare notes, and build bridges – between community-currency practitioners and technologists, between monetary theory and local practice, between people who have spent decades on alternative exchange and those arriving from newer fields such as Web3, regenerative finance, and network science.

Matthew describes the spirit and rhythm of these gatherings as follows:

First, we talk – a lot – and learn from each other; often we realise we are describing the same thing in different words. Then we help each other in little ways. Then, sometimes, we do projects together.

CoFi4, the fourth gathering, runs 21–28 June 2026 at Commons Hub Austria, in Hirschwang an der Rax, at the foot of the Alps. It is less a typical conference than an intimate, week-long community retreat combining structured sessions and open space with shared meals, walks, and time in nature – set in a former countryside inn now being developed as a centre for the commons economy. The programme is organised around daily themes spanning experiential learning, mechanisms, infrastructure, system analysis, and implementation strategies. Katja Durrani’s review of CoFi3 gives a good sense of the welcome that awaits.

A few places remain — if you’re working on community finance, or simply curious how finance might serve communities differently, come and join us!

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This topic belongs to the Economy & finance section of the knowledge base. You can also ask questions or add information on our forum or via the Substack comment function below.

This is an interview with David Barkin, distinguished professor of economics at the Universidad Autónoma Metropolitana, Mexico. He collaborates with indigenous and peasant communities, many of which are developing new institutions, trying to build a post-capitalist society. He’s recognised for his theory of Radical Ecological Economics. Here, he’s talking with Dave of Growing the Commons about successful commons projects in Mexico and around the world.

Below is a video of our conversation, followed by a summary in bullet points (with links to more info), and then the complete transcript.

Summary

• Ecological economics as a field was created in 1989 by economists and biologists, who produced academic output on the connection between classical economics and environmental damage

• Barkin became convinced that the state would not be able to solve these problems, but that communities in Mesoamerica had systems that didn’t involve capital accumulation or the consumer economy, that could allow humans to live in harmony with nature. Children and old people were involved in the community, rather than in nurseries or care homes.

• Society is part of nature, and has to care for non-human species as well as humans. This Barkin called ‘radical ecological economics‘.

• Marx, in his later writings, was impressed with grassroots organisation and indigenous groups in many parts of the world, and moved away somewhat from focus on seizing the state as a route to a post-capitalist world.

• There are thousands of grassroots groups around the world that have organised to protect their environment and to ensure that their young and old are not burdens on society. These are not ‘subsistence communities’ - they have huge celebrations of life involving the entire community, and their young people go to universities around the world.

• Mexico has interesting commons or commons-like projects, such as the Ejido movement - a land (and water) commons, that has survived attempts by a neoliberal state to privatise it. Also, the Zapatista uprising happened when NAFTA was formed in 1994, as they saw it as a threat to their freedom and quality of life, as it gave control of much of the Mexican economy to US capital.

• The Zapatista movement is still alive and well, in the southern state of Chiapas, and has rescued an area the size of the Netherlands, with a population of half a million people, from timber exploitation, monoculture agriculture and cattle ranching, and introduced self-management and local governance.

• There’s a day-to-day struggle between capitalism and commons in the Global South. Neoliberal globalisation has made it difficult for nation-states to make the kinds of changes we’re talking about, but tens of thousands of local communities in the Global South insisting on protecting their cultural and economic heritage is giving a new breath of life to the commons.

• Another example in Mexico: a co-operative union called Tosepan, built around a credit union that funds their economic ventures, with 40,000 families participating, in the state of Puebla. Their land-use plan, validated by the government, prohibits mining and high-voltage electric lines, corporate supermarkets and foreign investment in commercial operations in their territory.

• Also Cheran, in Mexico, formed via an uprising started by 30 women in 2011 to stop logging and organised crime. They’ve since initiated self-governance and expelled political parties and the national police force!

• There’s an international consortium of thousands of communities, committed to the collective governance of their territories, in all continents, called Territories of Life, that restrict nation-state activities within their territories. This includes the Global North - for example Snowchange in Finland, protecting old-growth forest, waterways and peatland, and re-wilding. They’ve created an alliance of peoples within the Arctic Circle, in Siberia, Scandinavia, Greenland, Canada and Alaska, enabling their communities to provide a good quality of life and counteract environmental degradation. There’s a beautifully-illustrated, freely-downloadable book.

• Here are examples from the Global North in the journal, Ambio.

• See also David’s paper, Radical Ecological Economics, for more.

• In a nutshell: commons are thriving on a global scale, but the domination of neoliberal ideas is holding them back.

Transcript

Dave Darby: Today, I’m talking with David Barkin, distinguished professor of economics at the Universidad Autonoma Metropolitana, Mexico. He collaborates with indigenous and peasant communities, many of which are developing new institutions trying to build a post-capitalist society. And he’s recognised for his theory of radical ecological economics. Hello, David.

David Barkin: What a pleasure to be with you on this international connection.

Dave Darby: And what is radical ecological economics?

David Barkin: Radical ecological economics is the result of our work with communities. It’s radical in the sense that ecological economics as a field was created in 1989, at a meeting, in Washington, DC. But it was invented by economists and some biologists who were interested in using their tools of economic analysis to understand what were the impacts of environmental change on the planet. The heritage of that was a number of extraordinarily important thinkers. One of them was Kenneth Boulding.

Kenneth Boulding was a professor of economics in his last years at the University of Colorado, and he wrote a very prescient article called The Economics of the Coming Spaceship Earth in which he said, if we think about Earth as a spaceship, and all of the world’s population were passengers in the spaceship, and everything that humanity had to survive was in the hold of the spaceship, then the question would be: how long would they last in space before everyone died off? And that was an extraordinarily important, influential article coming out at about the same time as the beautiful book called Silent Spring by Rachel Carson. That was, we could say, the roaring sixties. And then a Romanian by the name of Nicolas Georgescu-Roegen did another masterpiece. He was awarded the prize of the most promising young environmentalist economist in The United States at the time.

He was at Harvard, and he wrote a book about the second law of thermodynamics [The Entropy Law and the Economic Process]. And in his book, he was saying there’s no way we can get around the inevitable fact that there’s only so much energy in the world, and that to the extent that we’re using it, we’re degrading it so that it will no longer be available for the human species. And some of your listeners may know that a man by the name of [William D.] Nordhaus won the Nobel Prize in economics for his extraordinary – at the time – emphasis on the fact that global warming was a problem, but not an unmanageable problem using the tools of economics.

I was born in the United States, but by that time, I had lived forty years in Mexico. And, working with indigenous communities, I became quite convinced that the state – that is the government, public policy – would be unable to solve the environmental problems and that there was an extraordinary fountain of knowledge among the peoples of Mesoamerica to confront the problems. And in fact, they were actually going about living a different way of life saying, we’re not interested in capital accumulation. We’re not interested in the consumer economy. What we’re interested in is living our lives the way we’ve always done.

But very importantly, no one was to be left behind. That was extraordinarily important. What does that mean? That means that there are no children stuck in day care centres doing nothing, playing, but the children are actively involved in solving the community’s problems.

But the other part of that was that there are no old people who are sitting around in old people’s homes or in wheelchairs. They had a fountain of knowledge which the community valued and depended upon for their leadership and their wisdom. And so this approach was very important, and very firmly impressed upon me together with another thing, that society is part of nature. And that’s a really extraordinary thing - that we have to take care of all the other nonhuman species that are in the environment.

And the question is, to what extent can we take advantage of all of these resources in the economy, without damaging our own future lives. And so that’s what led me to ecological economics from below. And then we had to make it more understandable, so we called it radical ecological economics.

Dave Darby: I changed a traditional economist’s view on that once. He said that the biosphere was a subset of the global economy. I said, don’t be silly. It’s the other way around. I said, what would happen to the biosphere if the global economy was destroyed?

He said, nothing. It would probably get better. I said, what would happen to the global economy if the biosphere was destroyed? He said, oh, okay, yes.

David Barkin: Well, that’s a simpler way of phrasing it than the long description I just gave.

Dave Darby: And you contacted me about Marx’s views changing in later life. I’m writing a series of articles [Commons, not Communism] trying to persuade anti-capitalists that commons is a better route to post-capitalism than Marxism. But you opened my eyes to Marx’s later ideas, which sounded more like commons to me, rather than getting the working class to rise up and overthrow the state. So thank you very much for that.

David Barkin: Well, it was my pleasure to get in contact with you about that. But the extraordinary thing about it was that all of these insights by Marx were marginal notes in his notebooks of the readings that he was making of anthropologists in the late nineteenth century. Of course, he was slightly immobile in his lodgings in London at the time, But, it was extraordinary given the limited amount of anthropological work that was going on at that time that he acquired all of this knowledge and began to make two, I think, very important discoveries. He was asked very presciently, does the Russian peasantry have to destroy itself, or have to be destroyed, in order to move to a better society? And his letters at the beginning of the eighties were extraordinarily insightful in saying, well, perhaps the Russian peasants in their ‘mir’ could, actually, skip the stage of capitalism and go on to create a communal society in which they would be able to improve their standard of living, take care of the environment and point the way to a better future world.

That was an insight that was extraordinarily important. The other was his familiarity with what was going on in Ireland at the time. And, similarly, he was very impressed by the Irish capacity for communal organisation of their land holdings and their disdain for the Irish state. And then he got hold of all these anthropologists from what we now know as the Global South. But, let me say that one of the parts of the Global South is what is now know as North America. He was very impressed by an indigenous group that we call, in Anglo Saxon terms, Iroquois.

Yeah. But it was part of the Haudenosaunee (I’m pronouncing it badly) confederation in the Northeastern part of North America. And they had lived for centuries, if not millennia, taking care of their land and assuring a good quality of life with full participation, including women and men in the process of management. And then he came across, of course, the literature about Mesoamerica, and the Andes. And he began to write about that, and he said he had great hopes that these people with their communal traditions and their understanding of the need to take care of the land, would be able to create the basis for new society after capitalism.

Dave Darby: Yeah. I’ve read about the Iroquois Federation. It was David Graeber. I was amazed. It was really participatory democracy in action.

David Barkin: It’s very, very interesting. Jean Jacques Rousseau read about it in a travelogue of a French missionary who went to the northern part of the Iroquois confederation and described all of that. And, actually, the French missionary brought back to France one of the leaders of the confederation.

Dave Darby: I read about that. Oh my god. I would have loved to have been in that room.

David Barkin: And it’s really quite extraordinary. The indigenous person after being in Paris for a little while said, I don’t wanna stay here. This is an awful society. How can you have children begging in the streets and the dirt and the filth and the bad treatment of so many people? This is something we would not allow.

That’s in chapter two of the Graeber [& Wengrow] book, The Dawn of Everything.

Dave Darby: Yeah. I mean, I couldn’t believe that when I read it. I would have loved to have been in that meeting. So I want to show that revolutionary change doesn’t have to be centralised and that the Russian revolution could have produced a decentralised result, and the twentieth century could have been very different. And I’d like to know what you think about that.

I mean, attempts at decentralised, nonhierarchical, truly democratic organisation keep coming back throughout history, don’t they? And they don’t seem as though they’re gonna stop.

David Barkin: Well, I don’t think it’s a question of them keeping coming back. They’ve never left. I think that the important thing is that there are literally thousands of communities around the world on all the continents, including the Global North, of peoples who are organising themselves to respect their territories, and to make sure that their young and their old are not burdens on society. And they are doing so with a quality of life and a celebration of their relationship to the cosmos that is quite extraordinary.

We call this native tourism when people from the North go and visit an Amazonian community or you have a beautiful, colourful, indigenous celebration of life. One of the questions that led me to codify radical ecological economics was the fact that mainstream social sciences talk about many of these communities as subsistence communities. I would ask your listeners to think about it. What kind of subsistence community exists where you have a three or four day communal ceremony celebrating life and with everyone participating, and where there are no extraordinary inequalities within the community?

And they are continually attempting to make sure that people are able to have an improving quality of life. But I want to emphasise one thing about many of these communities that we’ve had contact with. These are not communities that are separated from the modern world. These are communities that are sending their young children to universities around the world. These are communities that are learning about the advances in science and technology, about the advances in medicine, and they are communities that are evaluating what part of this knowledge is valuable for their well-being and what part of this knowledge has to be discarded. And that’s extraordinary. If you think about it, not just here in Mexico, but it’s all over the the world.

Dave Darby: ‘Growing the Commons’, we are promoting commons projects, but mainly in the Global North. I’d like to talk to you about what’s happening in the Global South and how we might connect. And in Mexico specifically, I want to talk about the projects there, especially the Zapatistas and the Ejido movement and others. From what I read, Ejido is like a land commons, but the land is ultimately owned by the state. Is that right?

I mean, that’s a problem if the state changes its mind. I think in 1991, the government allowed Ejido land to be rented or sold, and stopped creating new Ejido land projects because Mexico wanted to be in NAFTA. Is that right?

David Barkin: It was in 1992, a constitutional amendment by a neoliberal regime. But the interesting thing is that more than half of the ejido land that could have been privatised has not been privatised. It’s held in commons. And while it is literally true that all the land is given in concessions to the ejidos and therefore, ultimately, property rests in the state, the fact is that the ejidos are in one way or another, self-governing groups of people.

A growing number of these communities are beginning to insist upon the collective management of their lands. This has become increasingly important because it doesn’t matter if you have land, if you don’t have access to water. And the collective organisation for the control of water rights is an area of great contention.

So there are a great many communities that are beginning to look for ways of reclaiming their control over the water rights that the Mexican constitution gives them, but have been privatised, by diverse nefarious mechanisms. I won’t go into the details of that. Sometimes they’re very violent, and corrupt.

Dave Darby: And the privatisation of ejido Lands, is that what caused the Zapatista uprising? Is that right?

David Barkin: No. The Zapatista uprising was a much more profound uprising than simply the privatisation of the ejido. The Zapatista uprising was in January 1994, which was when NAFTA, or the free trade area, went into effect. And they said, the underlying cause of the choice of that date was that NAFTA is a threat to our sovereignty, to our freedoms, and to our ability to live a good life. That was a prescient understanding of what would happen with NAFTA, because what free trade did was subject much of the Mexican economy to control by US capital and US political interests.

And, the Zapatista rebellion is still alive and well, thirty two years later.

Dave Darby: And how are they doing? And, what have they achieved?

David Barkin: Often we think of the Zapatistas as a group of men on horseback with their guns and being very militaristic. But the Zapatista movement is a group of people in the Southern state of Chiapas that encompasses a population of about half a million people.

We’re not talking about a small band of horseback riders. But also I want to emphasise that the area that they are controlling and the area they have rescued from cattle ranchers, from monoculture and from timber exploitation, is an area greater than the size of the Netherlands. So we’re not talking about a small movement that is socially and politically irrelevant. We’re talking about a movement that over the past thirty years has dramatically improved the life of half a million people, and, just as important, has brought women in as equal partners into the process of local development and local management, and has improved the health standards and the nutrition of the people.

So the Zapatista movement has extraordinarily enriched the lives of half a million people and led to a decentralised series of local governments throughout this territory that are self-managed and are insisting upon the strengthening of the commons.

Dave Darby: I mean, one of my main points is that the mainstream Marxist approach of workers seizing centralised power is not going to work in the Global North, and the commons approach is much better. I’d like your opinion on that. And is it different in the global South?

David Barkin: In the Global South, I think that the domination of neoliberal economic plans and the political domination of what’s called globalisation, has led to a limiting of the possibilities for nation-states to make the kinds of changes we’re talking about.

And one of the few nation-states that has tried to do that is Cuba - under attack for trying to insist upon improving the quality of life for all of its people. But the kind of commons that are being created by the thousands, tens of thousands of communities that are involved in resuscitating or strengthening their cultural, political, and economic heritage, is definitely giving a new breath of life to what you and your colleagues in the North are trying to do for reviving the commons. But I think that it’s very, very important to understand that these movements for building the commons in the South are not state-run. These are grassroots movements, and many of them can trace their roots back thousands of years.

You mentioned David Graeber and the chapter he wrote with David Wengrow on the Iroquois. But the important thing is that there are still many thousands of communities around the world that are practicing these traditions, and recuperating these knowledges and enriching them with the best of modern science and technology, to improve their quality of life and protect their territories.

Dave Darby: So community is very weak in the UK. You know, there are very few people walking in the street and talking with each other. All the front gardens are paved over. The little pubs and shops have closed. But community is much stronger in the Global South, isn’t it? And that’s a big factor in what’s possible, as regards commons, isn’t it?

David Barkin: Well, I hate to make these kinds of sweeping generalisations that you just made because large parts of the Global South, as you call it, are very much intertwined with the dynamics, the personalities, the politics, and the economics of individualisation which goes with the capitalist economy. In this moment, for example, in Latin America, there’s a struggle among those who are trying to impose the rule of capital, and those who are trying to strengthen the commons that they live in. And so that kind of struggle is a very, very real struggle which we live day to day.

And that struggle, of course, is being fed by large injections of money and politics from the Global North.

Dave Darby: Yeah. But are you saying that there is no more real community in the Global South than there is in the Global North?

David Barkin: No. I’m not saying that. I’m saying that there are lots of communities all over the Global South, and in parts of the Global North, that are strengthening and expanding community.

We just talked about the Zapatistas. But I’ll give you another example in Mexico. There’s a cooperative union, of people from three different ethnic groups that fifty years ago formed Tosepan, which brings together a quarter of a million people.

Dave Darby: Can you say that one again? Spell it.

David Barkin: Tosepan, t o s e p a n.

And during that fifty years, they have been effective in creating a credit union which finances all of their economic ventures in which they have 40,000 families participating. And they have developed a land-use plan for their area, which is extraordinary because it’s a very valuable and a very rich area.

Dave Darby: And which area is this?

David Barkin: It’s in the mountainous area in the north of the state of Puebla. And their land-use plan, which has now been validated by the government, prohibits mining, prohibits high voltage electric lines, prohibits the installation of supermarkets, prohibits the use of foreign investment for commercial operations in their territory. And the extraordinary thing about it is with all of these prohibitions, the people in that community will tell you that they’re living a good quality of life.

Dave Darby: And are these kind of projects replicable?

David Barkin: Not on that scale. A scale of a quarter of a million people, formally organised into cooperatives like that doesn’t seem like it’s gonna happen again in Mexico. But, and it’s extraordinary - they’re 50 years old, and they’ve just written a book, which is a life plan for the next forty years.

It’s being replicated, in different ways and on different scales throughout Mexico and around the world. And perhaps we should move now to a consortium of communities, that was created beginning thirty years ago but formalised in 2010, called Territories of Life. That consortium brings together thousands of communities in every continent, including parts of the Global North, and I can talk about that.

Dave Darby: Please do.

David Barkin: They are committed to the collective organisation of their territories. And that goes back to an ILO convention of 1989. I really want to stress that the notion of the commons and the development of these collective ways of managing is not something brand new that was invented ten years ago.

But the International Labor Organisation codified a convention. It required consent for any national government to engage in activities in indigenous territories.

Dave Darby: You said this consortium is called Territories of Life? And it’s an indigenous consortium?

David Barkin: Well, most of the members are indigenous, but many in Mexico, we would call mestizo communities. That is they are mixed-blood communities, because many indigenous people have interbred now with people of other descents. The important thing about that is that Territories of Life encompasses many, many people in the Global North.

I can give you an example of one very important group in Finland, which I just visited. The group is called Snowchange and is a cooperative. And over the past quarter of a century since they were formed, they have engaged in protecting old-growth forests and trying to rescue peatlands, which are one of the major forms of carbon sequestration that nature has developed. And they are rehabilitating the waterways, the lakes, and the fjords in their region so that they can have healthy fishing while assuring that fish populations are not endangered.

They’re also doing something extraordinary, which is called re-wilding. They are rebuilding the forest structures, of yore.

The important thing is not just the trees, but when you rebuild the forest, you rebuild all of the wildlife that is so important to our quality of life. And they also have activities to support the Sami population in the Arctic. They’ve created an alliance between all the people above the Arctic Circle. That is in Siberia, Finland, all the other Nordic countries, Greenland, Iceland, Canada, and Alaska.

And these groups of people are going about a very systematic program of re-enriching their territories, making them capable of a good quality of life and making a substantial contribution to counteract environmental degradation on a global scale.

Dave Darby: That’s really exciting. I have to look up these Territories of Life.

David Barkin: There’s a 350-page book, which is beautifully illustrated, 50 pages of footnotes, and on the Internet, which is freely downloadable in English and Spanish.

Dave Darby: Fantastic. Why didn’t I know about that?

David Barkin: Well, I mean, that’s part of the problem. If you accord these rights to the indigenous population, what you’re doing is reducing the ability of large corporations to continue their process of capital accumulation.

Dave Darby: What do you think are the main barriers to building commons in both the Global South and the Global North? And how might we overcome them? Is it always gonna be marginal, or can it actually challenge capitalism?

David Barkin: Well, I’m very optimistic in the sense that I think capitalism is on its deathbed. But perhaps that’s not what your audience wants to hear.

Dave Darby: I don’t know. It seems to be having a good attempt to commit suicide, doesn’t it, capitalism?

David Barkin: But it’s marginal in the sense that it’s not in Hollywood movies. Although I must admit that there have been a number of very, very good movies recently, celebrating people who are trying to do this in the Global North. I can think, for example, of Wes Jackson, there’s a wonderful movie called Prairie Prophecy. I recommend it to your people.

Celebrating the work of rebuilding the prairies in the Midwest of The United States by an agroecologist called Wes Jackson who has spent all of his life showing that the wildlife, the bison, the collective control of land and the use of it with agroecological techniques are extraordinarily valuable to improving the quality of life, of people who are capitalist farmers. And Prairie Prophecy is a movie that I would recommend to your people. Also, there’s an article in the journal Ambio, from 2025, called ‘Extent and Diversity of Recognized Indigenous and Community Lands, Cases from Northern And Western Europe’.

Dave Darby: Okay. I’ll look at that. But back to Mexico for a second. Do you have any links or sources of information for people to keep up to speed with the Zapatista and the Ejido and other movements in Mexico? And also, what might they be able to do if they would like to help in any way?

David Barkin: Okay. The links are very, very easy. If you just put Zapatista movement in your search, you’ll find lots and lots of material, on that. And they have their own site, which is very, very good because it’s available in 15 languages - all the declarations over the past thirty years of what they’re doing and what they’re trying to do.

But, also, a description of the kind of onslaught by organised crime against them because organised crime would, of course, like to use this territory for its own purposes. Tosepan is less well documented, but there’s another community called Cherán, which had an uprising in 2011. The uprising was instigated by 30 women, who stood in the middle of the road against a criminal logging group. And with their babies in their arms, they were able to stop the logging effort and catalysed the community into supporting and developing a collective effort to expel organised crime from their area.

But not only that, what happened also was that as a result of that, the community realised the extraordinary significance of their indigenous heritage. And in the fifteen years since then, they have installed self governance. They’ve expelled political parties. They’ve expelled the national police force. They have obligatory bilingual education, and they have four communal enterprises which provide some of the economic resources that they need for their own survival and well-being.

You can find lots of information in English. It’s much more than the Zapatista and Ejido in Mexico. There’s much more going on.

The article that I wrote that was the instigation for our conversations, called Radical Ecological Economics with open access on the Internet. You just put radical ecological economics, subtitle: a paradigm from the Global South.

Dave Darby: I’ll definitely put a link to that in the description as well as all the other things we’ve been talking about.

David Barkin: But the thing I want to stress is that, just in Mexico, hundreds of communities are involved in this kind of operation. Some of them with the support of government, and some of them in direct confrontation with the government. But throughout Latin America, you have examples of communities. I would venture to say that the only reason the Amazon still exists is because of the hundreds of communities that are still resisting the illegal gold mining, the petroleum exploitation, and the forest degradation as well as expansion of sorghum and soy production. So what can your audience do to find out more about this?

There’s a lot of references in my article, and Territories of Life has its own website. So the importance of this is really much more than I think many appreciate.

The commons in New Zealand are very, very important, and it’s a very important struggle in Australia too. I don’t know how much contact your movement has with what’s going on among indigenous peoples and indigenous rights in Australia and New Zealand?

Dave Darby: We don’t. So that’s why I’d like to build these kinds of relationships.

David Barkin: There’s a very good book, called The Commons in an Era of Uncertainty, published by the University of Toronto Press, by a man from Ghana. It’s a beautiful collection of essays.

The next time we talk, I’ll make sure our connection is better.

Dave Darby: Okay. And, if you’ll allow me, I’d love to tap into your wisdom and get some more information that we can broadcast on Growing the Commons.

David Barkin: Great. Bye bye.

Dave Darby: Thank you, David. Lovely speaking with you. Bye bye.

Each round-up brings together short updates from projects and organisations our members are involved in. For more information about the GtC collaboration and the people behind it, visit our About page. The first edition of the round-up can be found here.

Are you working on a commons project? We’d love to feature your work – get in touch to find out more.

Knowledge & dialogue

GtC Knowledge Commons

An open wiki-based initiative bringing together introductory guides, resources, and practical knowledge about the Commons, with topics curated by specialist contributors.

The knowledge base wiki is the second aspect of the broader Growing the Commons knowledge commons that we’re building – and much has happened in the last few weeks.

Following the completion of the large-scale transfer of materials from LowImpact, we set out restructuring and regrouping topics in ways that make the knowledge base easier to navigate, maintain, and expand over time. We have now reached the point where we can begin inviting people to share in the ongoing curation of this shared knowledge. That means not only keeping materials accurate and up to date, but also gradually expanding into new areas.

Of course, we need people with deep knowledge of the many commons-related subjects already featured. But if this is going to become genuinely useful to a broad range of people, we also need contributors with skills in teaching, journalism, editing and communication – people able to help translate complex material into forms that are actually digestible. And, naturally, we also need at least a few people capable of managing the more technical side of things: formatting, structure, templates, and maintaining the wiki itself.

It’s rare to have all three sets of skills in one person, so we are imagining small collaborative teams forming around topics and areas of interest, with people contributing in different ways and all benefiting from each other’s abilities.

We have already tried out introducing a few new people to our wiki, and this is proving not to be impossible! We look forward to more volunteers with these skills, perhaps younger people who would benefit from being directly in touch with experts or specialists in their own fields. We now have a working set of guidance material and templates to help people get involved. If you are onboarded as a curator, you will have your own public page on the wiki to help publicise your work, spaces to discuss and comment on the pages you steward, and opportunities to collaboratively hone new questions to guide the advance of our commoned knowledge.

Credit Commons Society

Formed during the COVID-19 lockdown in the UK, the Credit Commons Society hosts a regular online gathering for practitioners, researchers and organisers interested in collaborative finance and the development of the Credit Commons – a global network of decentralised “moneyless” trading groups built on a shared open protocol.

The Credit Commons Society has had a quieter period over the past two months, with no recent online gatherings taking place. During this pause, we took the opportunity to begin publishing recordings and transcripts from previous conversations here on the Growing the Commons Substack.

Recently published sessions include conversations with Dil Green on commoning in practice, Matthew Slater on the Credit Commons Protocol, and Michel Rauchs on the Commons between markets and states.

Festival of Commoning

An annual gathering in Stroud, Gloucestershire that celebrates and connects the people acting together to build commons of all kinds – bringing together thinkers, practitioners, and communities from across the UK and beyond.

Preparations are well underway for the third annual Festival of Commoning, which will take place across Stroud on Friday 2 and Saturday 3 October 2026.

This year’s theme is Common Ground: Healing Divides. We will celebrate stories from people and projects who use commoning practices to foster belonging, mutual care, resilience, and shared power in the face of growing societal division, polarisation, inequality, isolation and exclusion. This year, alongside the usual talks and workshops, we’re creating more spaces for participants to connect with each other, learn new collaborative skills, and experience commoning projects already making an impact in and around Stroud.

The festival is organised by a group of volunteers local to Stroud, while also drawing on relationships and participation from the wider global commoning movement. It is a festival for doers, organisers, and people who want to common.

The new website has recently gone live, with the line-up confirmed and tickets now available. In the spirit of commoning, tickets are being offered on a sliding scale to help make the festival accessible to as many people as possible. This includes supported tickets, standard tickets, and “pay-it-forward” tickets that help subsidise places for others. A limited number of free tickets are also available for people who would otherwise be unable to attend.

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Commons infrastructure

Commons Lab

A new research lab dedicated to building enabling infrastructure for thriving commons – developing open design frameworks, field-tested models, and practical learning resources to help communities create and sustain viable commons projects of their own.

Earlier this week we launched the first fuller version of our website after spending the last two months operating with little more than a placeholder page. It is still early, but the site now brings together a clearer picture of our mission, programme areas, and overall approach, including some initial material introducing the Commons for people less familiar with it – covering, among other things, its history, manifestations, and common myths. If you have a moment to look through it, we’d genuinely welcome any thoughts or feedback.

On the funding side, both of our recent grant applications were unfortunately unsuccessful. The feedback was thoughtful and broadly consistent: reviewers found the ideas “innovative”, “genuinely different”, and overall “compelling”, but felt Commons Lab itself is still too early-stage as an organisation for support at this point. This is of course not the outcome we were hoping for, but going through the process was a useful exercise that helped clarify where the project currently stands and what still needs to mature. In response, we are now exploring more lightweight ways to bring in some support – mainly to help cover a portion of the time and costs that are currently entirely voluntary.

The main focus is now turning towards the core of the work itself, particularly formalising the Integrated Commons Toolkit – the underlying design framework behind our sector models – and developing the first practical playbook based on the experience of the Stroud Climbing Commons (see below for updates). We’ll share more as this develops, but if you’re curious to learn more, we’d be glad to hear from you.

Local Loop Merseyside

The UK’s first member-owned credit clearing club for local businesses, helping small and medium enterprises across the Liverpool city region solve cash flow problems, get paid on time, and build local trade.

It has been a fairly tumultuous period for Local Loop Merseyside and Mutual Credit Services since the last update – though fortunately with good outcomes.

We come out of this period having formally launched Local Loop in Merseyside, with a great cohort of founding member businesses, and with a team that is increasingly firing on all cylinders and working as a unit. It is, admittedly, a much smaller team than last year: we will soon be down to about five full-time equivalent people, compared to ten or eleven some time ago.

But we have secured some more funding, which enables us to double down on improving the user experience for businesses who share their invoice data with us before the network reaches the scale required to do proper clearing. That funding also now allows us to take on a real local business growth-driver person – yes, that terrible word, growth. But, honestly, the Commons will have to grow at a faster rate if it is to have any impact – growth of the commons sector at the expense of the capitalist economy, not growth in terms of GDP, which it should effectively reduce.

Another development during this period is genuinely exciting, but also comes with a tinge of unease, just like the word growth. We have been engaging much more seriously with AI-assisted development tools to multiply our capacities and significantly expand what we are able to build. However, we try to remain honest about the compromises involved: there are, of course, huge energy and social costs that make this possible, and we are determined over the next year to have our own local AI models running on our own hardware, rather than being beholden to the rapidly escalating AI arms race driven by large commercial providers. No one gets out of here without compromising.

Open Food Network

A global open-source platform that connects farmers, growers and community food enterprises – enabling them to sell directly to their communities and build a fairer, more resilient food system from the bottom up.

Over the past few months, Open Food Network has been developing and piloting Power of Food, a social cohesion project exploring how food-based activities can help bring people together across social, cultural, and political differences.

This work builds on something we’ve repeatedly seen over years of supporting local food networks: that growing, cultivating, harvesting, cooking, and eating together create forms of connection that often outlast political disagreement. The current project is an attempt to better understand, document, and share those practices so they can be taken up and adapted by other communities.

The next phase will involve learning from projects already bringing people together around food, experimenting with storytelling and arts-based facilitation approaches, and creating spaces where people can share experiences connected to food, place, identity, and belonging. We’re particularly interested in how food can help address loneliness, isolation, fear of the future, and wider social fragmentation in ways that feel grounded and practical.

We are now looking for rollout funding to expand the project further and make the learning openly accessible so other communities can build on it themselves. At the heart of the project is a simple belief that has only become stronger through the pilot process: that people who eat together can live together.

If you want to learn more about how to get involved and support the project, please reach out here.

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Place & community

Stroud Climbing Commons

A community-owned climbing gym built on the principle that access to climbing should not be determined by ability to pay, and that the people who use it should own and govern it together.

The long wait is over – after several years of planning, fundraising, design work, and construction, the Climbing Commons has finally begun opening its doors.

It’s still slightly surreal seeing people come through the space, especially remembering where we started: an empty industrial shell at Brimscombe Mill and a fairly wild idea about community-owned climbing. Since then, thousands of volunteer hours have gone into turning the project into a functioning community bouldering facility based on the principle that climbing should be accessible, affordable, and safe for everyone.

We’re now beginning a phased opening while we test systems, gradually expand sessions and opening hours, and work out the inevitable practical issues that only really emerge once people start using the space. Founding members and early crowdfunder supporters are first through the door before we open more widely to the public over the coming weeks and months.

Like many commons projects, Climbing Commons is still a member-led organisation run on the goodwill of a small group of volunteers, which creates real limitations around staffing and opening hours. We do want to transition to paying staff soon, but have designed the model so that we can gradually build operational capacity and observe what is financially viable before committing to hiring. At the same time, we’re starting the longer transition towards social commons governance and inviting more people to get involved in stewarding and helping run the space itself.

Alongside climbing itself, we also hope the facility becomes something broader than just a climbing wall – somewhere people can spend time together, organise activities, and build community around the space. With summer approaching, we’re looking forward to finally celebrating properly after the long build process. The opening party will take place on Friday 5 June with a BBQ and music at The Long Table – we hope to see some of you there!

Stroud Housing Commons

A community housing project in Stroud that brings residential properties into permanent common ownership, offering secure and affordable tenancies under a novel multi-stakeholder partnership structure designed to create material interdependence between tenants, investors, and stewards.

We’ve had quite a number of interesting developments since the last update, ranging from the everyday practicalities of stewarding a shared house through to the early exploration of a financial model that could unlock pension money for community housing.

At the most immediate level, our first tenant has now begun taking over the administrative side of stewarding the house itself. This further reduces the effective cash rent paid by tenants while also significantly improving the quality of bookkeeping and record-keeping we have been able to maintain so far. This marks an encouraging step as the commons begins to function more and more as a normal, everyday reality.

There is also an increasing feeling that several more houses may be on their way into the commons in Stroud over the next year or so. Some of that will be on the basis of Stroud Housing Commons (SHC) becoming incorporated as a company limited by guarantee with a bespoke multi-stakeholder membership constitution – which might even be something of a world first. This summer, the title deeds of the first house are expected to be formally transferred to the SHC in return for rent vouchers, which will be a notable stage in our evolution from informal stewardship arrangements towards fully established legal ownership by the commons itself.

Part of what we are trying to explore through this process is how organisations with large ambitions but small means and initially rather simple conditions can gradually evolve over time: beginning with a constitution that embodies the minimum viable governance structures appropriate to their current situation, while consciously building in the requirement for members to develop more sophisticated forms as responsibilities and ambitions grow.

Alongside these practical and organisational developments, some really exciting work has also started to emerge around financing. Working with collaborators connected to the worlds of pensions and actuarial mathematics, we have begun exploring whether a modified form of a historical type of mutual pension – a tontine – could be adapted to channel pension money out of big institutions and back into the places where people actually live, helping fund permanently affordable housing held in community ownership.

The proposal remains at an early stage, but the underlying ambition is substantial: finding ways for savings and pensions to provide pensioners with reasonable annuities while simultaneously supporting decent homes on decent terms, strengthening local stewardship, and reducing the scale of mortgage financing that drives up asset prices and pushes housing further out of reach for many people. In collaboration with the Institute of Actuarial Mathematics at Liverpool University, we are now hopeful of having two students undertake three-month special research projects on the mathematical modelling of mutual tontine pension funds to help buy houses into the commons.

Tiny House Project

An initiative in Stroud exploring how tiny houses – small, self-contained, ecological homes – on community land could provide secure and affordable housing for food growers.

The Tiny House Commons is a project born from the urgent need to address the interlocking crises of housing affordability and fair livelihoods for local regenerative growers. The project has taken a significant step from blueprint towards reality with the formal submission of our pre-application proposal to Stroud District Council.

The proposal centres on installing two pilot Tiny House modules at Good Small Farms in Stroud, a thriving regenerative farm producing market garden crops, raising pasture-fed livestock, and developing agroforestry systems. The homes, each approximately 8.0m x 3.2m with <45m² internal floor area, are designed to be movable and low-impact, using ground screws instead of permanent concrete foundations. The longer-term goal is to stabilise the grower workforce, enabling farms to pay fair wages, scale regenerative land management, and strengthen local food security, all while providing low-cost, high-quality homes for growers, new entrants to agriculture, or trainee landworkers.

At this stage, we are primarily seeking clear guidance from the council on the most appropriate planning route, with the hope that this pilot can serve as a viable case study for future scaling across the district. In the ideal case, we would not just secure approval for these first homes, but also a clear and supportive framework from the council that could give future Tiny House projects greater confidence and legitimacy as the model evolves – potentially even influencing local policy development to recognise the value of this approach.

Assuming the process moves forward positively, the next phase will involve more detailed co-design work with growers themselves to better understand their practical needs and how the spaces can be optimised to support the realities of living and working on the land. In parallel, we will also initiate conversations with local businesses and builders around sourcing materials regionally wherever possible, supporting the Stroud circular economy and cutting embodied carbon emissions associated with transport and construction.

Behind the scenes, we’re beginning to prepare for the launch of a dedicated website, broader public outreach via social media, and eventually a crowdfunding campaign built around Rent-Credit Obligations (RCOs), a community-backed voucher model intended to help keep the homes affordable over the long term while offering an ethical investment with fair returns to aligned funders.

There is a growing sense of excitement and confidence within the team: we’ve laid the foundations, assembled the right people, and have gained crucial lessons from successfully raising funds for and developing the Climbing Commons bouldering facility.

Bristol Commons

A city-wide initiative of individuals, organisations, and community groups seeking to build a culture of commoning and support broader community ownership and governance across Bristol.

The Bristol Commons is currently gearing up for activities that will support bringing the former Bethesda Sunday School building on Church Road, known as the “Spark Space”, into community ownership: a Community Share Offer aiming to raise £250,000, alongside a fundraising campaign for a further £150,000. You can learn more about it here.

On 28 March, we held an Open Day in the new space with food, drinks, and entertainment (including a bring-your-own-baby choir), where people from the local community could learn more about how the share offer will work. It was well attended, the atmosphere was great, and people were eager to learn more about the project and offer. A second Open Day is now planned for 6 June.

Meanwhile, a small editorial team is preparing the first edition of our new magazine, due to launch in July as part of the Bristol Commons website. The idea is for it to be more than simply a reporting platform: we hope it can also help build relationships across the wider community, with local people contributing directly to it over time. In that sense, we hope it can become something like an “organ for collective sensing, meaning-making and inter-group coordination”.

Thank you for reading this edition of the commons round-up. If any of these projects resonate with you, we encourage you to explore their work further, follow their progress, and share the article with others who may be interested.

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Contents

1. Bakunin and the Internationals

2. Anarchism and commons

3. Decentralisation of power in 1917

4. Bolsheviks re-centralise power

5. But it was really close

6. The 20th century could have been very different

7. Conclusion

This is one of a series of 24 articles that I hope to compile into a book – working title, The Commoners’ Manifesto: Neither Capitalism nor Communism. Here’s an introduction to the series. Comments welcome, including disagreement and debate.

In the previous article I looked at the problems with communism, from a commons perspective, including historical materialism, seizing the state, growth and progress and the working class as the vehicle for change, whilst recognising that Marx sounded much more like a commoner in his later years.

In this article I want to argue that a decentralised, commons world isn’t pie in the sky, and actually, the world could have easily moved in that direction in the 20^th century, rather than in a centralised, statist, world wars / cold war direction. Here are the main points I’ll cover:

1. Bakunin and other anarchists challenged Marx’s ideas well before the Russian Revolution, and could have become dominant in the workers’ movement.

2. Anarchism and community-based initiatives were strong in Russia and Ukraine in 1917.

3. Between the February and October revolutions, workers took control of the factories, peasants the land, and community and workplace assemblies had a lot of power.

4. After the October Revolution, Bolsheviks crushed these decentralised movements.

5. But it was really close, and it could all have been very different. We could have taken a profoundly decentralised direction in the 20^th century.

Bakunin and the Internationals

The ‘Internationals’ were four separate workers’ organisations at the end of the 19^th and beginning of the 20^th centuries, aiming to bring labour movements together globally in the same way that capitalism was internationalising.

• The First International, 1864-1876, aka The International Working Men’s Association. This was the stage for the Marx vs Bakunin split (centralised socialism vs anarchism) that caused its collapse.

• The Second International, 1889-1916, a federation of socialist and labour parties that broke apart during WW1 as, when push came to shove, nationalist sentiments trumped global solidarity.

• The Third International, 1919-43, The Communist International (Comintern), started by Lenin to promote Russian-style communist revolution.

• The Fourth International, 1938-present, started by Trotsky to oppose Stalin, only exists in fragments today.

I want to focus on the clash between Marx and Bakunin, which became the defining split in the First International, and finally tore it apart as Bakunin and his followers were expelled. We’ve talked a lot about Marx already. Let’s look at Bakunin, his arguments for anarchism and against Marxism, and whether he was right. Here’s an overview of the split, by a biographer of Marx, if you’re interested in the details, and below is my short summary.

Bakunin and Marx had an on-off relationship for 30 years, and respected each other. Although Bakunin described Marx as authoritarian, he also translated the Communist Manifesto into Russian. Their feud may or may not have been largely personal, but their attitudes to the state were very different. Bakunin saw the state not as a tool to be used, but a problem to be abolished. He argued for independent local communities, federated to get to scale, rather than a central state, which will always be captured by the most powerful groups in society, and used to maintain their power. He didn’t believe that workers could run the state, even temporarily, because if ‘workers’ get into positions of power (which isn’t likely), they stop working. And he certainly didn’t believe that the state would eventually ‘wither away’.

He believed that any authority should be temporary and voluntary. So for example, if a group of people found themselves on a boat in rough weather, and only one of them was an experienced sailor, they might decide to give authority to that person until they got safely to land again.

By many accounts, Bakunin wasn’t the nicest of people (and neither was Marx), but this isn’t about personalities, it’s about his predictions about what would happen if communists seize the state, which seem to me to have been correct. He said that the version of socialism proposed by Marx would mean that power is not transferred to the people but to the leaders of the communist party (Bakunin called them the ‘red bourgeoisie’).

He summarises his position nicely (in Statism and Anarchy, 1873): ‘The people will not be happier if the stick with which they are beaten is called ‘the people’s stick’’.

He was in favour of bringing together more aware people to ‘incite the latent instincts of the masses’. The internet makes it easier to bring aware people together, and I hope (and believe) that the latent instincts of the masses are towards commons, rather than centralised power.

Bakunin and the anarchists could have ‘won’ in the First International, which expanded quickly across Europe, but was hindered by language barriers, distances, slow communication and different legal restrictions in each country. So federal councils emerged to co-ordinate propaganda, organise congresses, manage membership disputes locally and translate and circulate resolutions.

The Basel congress in 1869 was the last really representative congress, before events in Europe (the Franco-Prussian war of 1870 and the Paris Commune of 1871 and its aftermath) made full congresses impossible. At that congress, according to Eugène Varlin, one of the International’s outstanding militants (who played a major role in the Paris Commune, and was executed for it), the position adopted almost unanimously by the delegates was collectivism, or non-authoritarian communism.

By the early 1870s, the movement was growing fastest in Spain, French-speaking Switzerland, Italy and Belgium, and in those places, a decentralised / federated approach dominated. The General Council in London and key northern European trade-union and socialist networks remained Marxist-controlled, but the balance of social and geographical strength within the International was shifting towards decentralised, anti-authoritarian socialism.

In Letters to a Frenchman on the Present Crisis (1870). Bakunin urged peasants to ‘take the land and throw out those landlords who live by the labour of others’ and to destroy state institutions through direct action, spreading ‘anarchy through the countryside’ (paraphrased from his 1870 writings). That’s exactly what did happen between the February and October revolutions of 1917 (see below), although of course it wasn’t because the peasants had read Bakunin!

A key event was the Paris Commune in 1871, just one year before the Bakuninists were expelled. It was claimed by both sides – as an example of the ‘dictatorship of the proletariat’ and of ‘anarchism in action’. Capitalists and their media blamed the International for the Commune, and indeed there were many International members involved. Marx wrote an address from the General Council praising the Commune. Bakunin claimed the commune had overthrown Marx’s ideas and accused him of hypocrisy.

The International’s support of the Commune made them enemies of all the governments of Europe and the bourgeois press. Although state repression usually hits centralised structures first, because there are identifiable leaders, physical headquarters etc., and local cells are harder to find and eliminate, it still caused problems for the anarchists because long-distance communication became harder and co-ordination costs rose faster than decentralisation capacity. The General Council was located in London, outside the main zones of repression, and so overall, anarchists were hurt more than Marxists.

After the Commune was defeated, Bakunin celebrated the fact that it had raised workers’ hopes of real change, outside of the state. Marx came to a different conclusion: for him, the defeat demonstrated the necessity for working-class political parties whose purpose would be the ‘conquest of political power’. Marx and Engels manipulated the composition of the Hague Congress in 1872 to ensure a majority that would affirm the London Conference resolution on political action, expel Bakunin and his associates and transfer the General Council to New York to prevent European anti-authoritarians from challenging their control.

Bakunin was accused of various skullduggeries including setting up secret alliances. But even Mehring (a Marxist), in Karl Marx: His Life, said that there was no evidence, and that Bakunin was trustworthy.

Bakunin and his followers formed their own decentralised movement (the St. Imier International), but both groups dissolved soon after. Anarchists weren’t allowed in the Second International.

None of this was inevitable. The outcome of the Hague Congress in 1872 didn’t reflect a clear ideological majority, but rather the ability of the Marxist leadership to leverage the International’s centralised institutional structure to discipline and expel its rivals. This approach wasn’t available to the anarchists, because of ideological opposition to centralised structures!

Anarchists weren’t fringe – they were a rival pole. Bakunin’s position was approved by the 1869 congress, was gaining ground across key regions of the International, and might have become the dominant tendency, but the institutional structure of the International - and the anarchists’ own anti-centralist principles – made it extremely difficult for them to convert that momentum into organisational control, as did events and the responses to them. In even slightly different circumstances, the main current of anti-capitalism by the time of the Russian Revolution might well have been decentralised / anarchist.

While an anarchist International would not have guaranteed an anarchist Russian Revolution, it could plausibly have shifted the balance of strategic and institutional resources away from highly centralised party models and thereby opened a broader range of revolutionary outcomes in 1917.

I’m not saying any of this was likely – just possible. A decentralised / commons world is no less likely than the communist revolutions of the 20^th century. It depends on events, the right people at the right place and time, hard work, and some luck.

Today, with the internet, it’s not so difficult to maintain national federations speaking different languages. The decentralised approach is much more achievable today, and local and national federations can speak to each other without going through a central hub. It’s still easy to imagine state crackdowns on anti-capitalist organisation, but today, centralised control would be a disadvantage, as it’s easier to shut down.

Anarchism and commons

Let’s look at the A-word. To many (probably most) it denotes chaos - and those in power have benefited from that. But it means the exact opposite. I’ll cover this more in a later article, but anarchism means decentralising power through negotiation and highly-ordered, non-hierarchical organisation, with decision-making covering larger geographical areas via confederation.

Bakunin didn’t help, by writing (in The Reaction in Germany), that ‘the passion for destruction is at the same time a creative passion’. While it is often cited by anarchists as a guide to action, Bakunin wasn’t outlining tactics or gesturing towards violence; he was writing as a Hegelian, not an anarchist. In Hegelianism, ‘destruction’ means the negation of an existing order as part of the process by which a new one comes into being - not chaos for its own sake.

Controversial I know, but I’d argue that ultimately, there are just 4 system-based philosophies: capitalism (ranging from neoliberalism to social democracy), communism, anarchism and fascism. Various lenses straddle those philosophies, like feminism or environmentalism. There are feminist capitalists and communists, and environmentalist anarchists and fascists (the Nazis were environmentalists).

Anarchism is a state of mind – a belief that people are basically good, but that power corrupts. People practice it all the time - in families, among friends, in clubs, informal and even formal gatherings or work. But there’s so much anarchist literature, often contradictory, and split into so many different threads (there wasn’t a central figure like Marx) that it needs some thinking about. There are lots of ways to do it, not one rigid ideology / set of rules. I identify 3 main threads though:

• Mutualist anarchism (follows Proudhon): gradualist rather than revolutionary; distribution via markets, but no bosses, landlords or shareholders - no making money from anybody else’s work or from usury. Private property is fine as long as you live in it (housing) or use it for your work (workshops / land).

• Collectivist anarchism (Bakunin): requires revolution; involves collectivisation of the means of production (land, industry, buildings, machinery); distribution is planned socially rather than through exchange.

• Communist anarchism (Kropotkin): revolution; people take what they need from communal stores; from each according to ability, to each according to need.

Here’s an infographic (not mine – I stole it from somewhere years ago) on the differences between strands of anarchism (leaves out collectivist anarchism, harsh on anarcho-primitivism but spot on about ‘anarcho-capitalism’):

If you want to go deeper, An Anarchist FAQ is a huge resource.

Commons is, I believe, a flavour (or building block) of anarchism – the mutualist flavour, to be specific. That doesn’t mean that it can’t evolve into something else (that doesn’t involve markets for example), but I can imagine it growing, in the cracks in capitalism, whereas I don’t see a viable route to the other two from where we are.

Anyone interested in commons is unlikely to be neoliberal or fascist, so arguing against them would just waste time. I’ve already argued against the communist approach from a commons perspective, and in future articles I’ll argue that the centre-left / social democrat approach is capitalism with (some) rough edges removed, and it won’t challenge corporations or deliver the scale of change we need.

Communist writers dismiss anarchism. For example, here: ‘Anarchism is appealing to many young people due to its simplicity: to reject anything and everything to do with the status quo. But upon deeper examination, there is a pervasive lack of real substance and depth of analysis in these ideas. Above all, there is very little in the way of an actually viable solution to the crisis of capitalism.’ (the rest of the article continues to patronise, and to demonstrate that he doesn’t understand anarchism).

Those not familiar with anarchist ideas see that anarchists and right-libertarians oppose the state, and often conflate them. Actually, the words libertarian and anarchist were virtually synonymous in the 19^th century. The right captured the word libertarian after WW2, some calling it anarcho-capitalism (an oxymoron if there ever was one), but some anarchists use the term left libertarian to describe themselves (although I’d prefer to drop left and right labels altogether, and just use the term anarchism. We’ll go into this more in the ‘decentralisation’ article, later, but the big difference between anarchists and (right) libertarians is their attitude towards capitalism. Libertarianism is nowadays a cover for vested interests, who want less regulation of their own industry. They want a small state until they squeal to be bailed out when they’re in trouble. Right libertarians denounce the state and champion capitalism. But capitalism can’t exist without the state, so right libertarianism is an oxymoron. Anarchists denounce the state and capitalists, as partners in centralising power.

And libertarians view society as consisting of nuclear families, individuals and businesses. They don’t include co-operation or commoning. Anarchists do.

But who needs -isms? We can just build commons. If you want to study anarchist theory as well, great. But it’s not necessary in the way that Marxist theory is necessary to understand and apply Marx’s ideas. Anarchism has been largely theoretical for a long time, at least in the West. Rojava is an exceptional example further east, but threatened now by developments in West Asia.

Decentralisation of power in 1917

Events in Russia in 1917 shaped the 20^th century, led to millions of deaths, untold suffering, and cold and hot wars. It could have been very different.

First, a bit of history. Serfdom didn’t end in Russia until 1861. Serfs were then legally free, but land was still owned by the nobility. Serfs were given allotment land that they had to reimburse the nobility for. The growing season in Russia is very short, and peasants couldn’t generate the surplus to pay the debt.

There was a revolution in 1905 – peasants rose up, burned many nobles’ manor houses and took the land under the ownership of the mir (village commune).

By 1917, WW1 was causing food shortages and breakdown in the Tsarist system. Anarchist ideas were spreading, especially in Ukraine, where Nestor Makhno was active in underground revolutionary circles that eventually developed into a large peasant-based insurgent movement that established zones of anarchist self-organisation. Anarchists played a part in the revolution, and in some regions helped defeat the ‘Whites’ (counter-revolutionary forces, including Tsarists).

There were actually two revolutions in 1917 – in February and in October. The February Revolution was a popular uprising that removed the Tsar, but the October Revolution was a Bolshevik military coup. Isaiah Berlin witnessed both of them. For him, the dominant feeling in the first was excitement, and in the second, fear (Michael Ignatieff, Isaiah Berlin: A Life and Isaiah Berlin, Russian Thinkers).

From a commons perspective, there were some very interesting developments between the revolutions of 1917. Peasants seized and redistributed land among themselves, and workers formed factory committees to run industries. This was a massive, decentralized social revolution from below. Sheila Fitzpatrick’s The Russian Revolution (1982) gives a good overview.

Many soviets appeared – locally elected councils, or ‘citizens’ assemblies’ (in towns, workplaces and army barracks), in parallel with but not controlled by national government. First formed in the 1905 revolution, soviets were crushed by the state, but re-emerged in February, 1917. Co-ops also expanded rapidly.

It seemed that actual workers had a different conception of ‘worker control’ from that of the Bolsheviks. Maurice Brinton (The Bolsheviks and Workers’ Control, 1917 to 1921) gives a detailed chronology of the development of popular structures in Russia after the February Revolution, then describes the Bolsheviks’ steps to undermine and destroy them after they gained power in the October Revolution (see below).

He said that by September there were national conferences of factory committees (All-Russian Factory Committee Congresses) that managed production in those factories. It was all looking very commons-like.

Bolsheviks re-centralise power

The Bolsheviks, especially Lenin, didn’t want a decentralized system. They believed in a vanguard party that would seize state power and use it to guide society towards communism (Lenin, What Is To Be Done?, 1902). They saw worker control as ‘syndicalist nonsense’ and peasant landholding as backward. They were disciplined, organized, and utterly ruthless in their pursuit of a monolithic state.

They gained influence in the soviets, especially the big ones in St Petersburg and Moscow. Lenin argued for direct seizure of power. Trotsky co-ordinated military forces loyal to the Bolsheviks, who easily took the Winter Palace (the imperial residence of the tsars, which was then housing the provisional government – the post-tsarist administration). There was an election immediately afterwards, which the Bolsheviks lost (but they dissolved the assembly and took power anyway).

But Peasants, workers and soldiers didn’t want centralised power, so the Bolsheviks indulged them at first, and got them onside by talking about how they’d got rid of the fur coats, fancy restaurants and mansions of the rich. This neutralised attempts by other groups (and there were many) to take centralised power off them. They crushed the independent factory committees, replacing them with state-appointed managers, forcibly requisitioned grain from peasants, leading to famine, and suppressed anarchist groups in Moscow, St Petersburg and Ukraine.

Emma Goldman, who lived in the Soviet Union for 2 years following the October Revolution, said (in My Disillusionment in Russia): ‘As soon as the Communist Party felt itself sufficiently strong in the government saddle, it began to limit the scope of popular activity. All independent organizations... were either subordinated to the needs of the new state or destroyed altogether, as were the soviets, the trade unions and the co-operatives – three great factors for the realization of the hopes of the Revolution.’

Maurice Brinton, in The Bolsheviks and Workers’ Control, 1917 to 1921, said that even before the October Revolution, Bolsheviks had started infiltrating factory committees with a view to making them subservient to the party. After gaining power, they started to dismantle the factory committee system.

Civil war followed (1918-21), which allowed the Bolsheviks to consolidate power using emergency wartime measures, expansion of the Red Army and secret police, and state terror.

‘Soviet Union’ implies a network of nested citizens’ assemblies, from neighbourhoods up to the national level. The Bolsheviks destroyed that idea, and enforced centralised control via the Communist Party. Soviets weren’t allowed any decision-making powers – only rubber-stamping the state’s decisions.

Sheila Fitzpatrick (in The Russian Revolution) noted similarities between communist collectivisation of land / rapid industrialisation in Russia and earlier enclosures and capitalist industrialisation in the West – both pushed peasant farmers off their land and into cities / factories.

Communists often denounce Stalin, but the Soviet Union was authoritarian well before Stalin became uncontested leader in 1928.

But it was really close

It really wasn’t inevitable that the Bolsheviks seized power in the October Revolution, or that they managed to keep it afterwards. They did it by the skin of their teeth. They never had majority support, couldn’t get elected nationally, and almost collapsed several times. They got power via a coup – that could easily have failed. They then held an election, lost heavily, and had to send in the Red Guards to close down the assembly.

Several factors helped the Bolsheviks. The provisional government was weak – after the February Revolution, authority was split between the government and the St Petersburg Soviet. The Soviet had real influence over workers and, crucially, soldiers. This ‘dual power’ meant the government couldn’t reliably enforce its decisions – orders could be ignored if the Soviet disagreed.

Led initially by figures like Alexander Kerensky (later prime minister), the government chose to continue fighting in World War 1. That was deeply unpopular: the army was exhausted, desertion was rising, and civilians faced shortages. Every failed offensive further destroyed its credibility.

Peasants wanted land redistribution immediately. The government delayed it, but peasants just started seizing land anyway – undermining the government’s authority in the countryside.

It was an interim body, not elected. It kept postponing elections, which made it look illegitimate – especially when more radical groups like the Bolsheviks were offering immediate solutions.

It mishandled crises – notably the ‘Kornilov Affair’. In August 1917, General Lavr Kornilov appeared to move troops toward St Petersburg, to impose order. Kerensky panicked and armed workers (including Bolsheviks) to defend the capital. This backfired: it strengthened the Bolsheviks while making the government look weak and unreliable. The government ended up alienating almost everyone. Liberals thought it was too weak, conservatives thought it had lost control, workers wanted more radical change, peasants wanted land, soldiers wanted peace. It was trying to fight a war, build a democracy, and contain a social revolution simultaneously, without real authority over the army or the streets. That made it fragile, and the Bolsheviks were able to exploit that fragility. They managed to get a large section of sailors and soldiers on board, with promises of ‘all power to the soviets’, gaining support for expectations that never materialised.

Workers and peasants could have maintained their control over industry and agriculture if factions within the Bolshevik movement (libertarian Marxists and others) had gained more power, and if there’d been a more unified anti-Bolshevik front (involving anarchist, Menshevik and Socialist-Revolutionaries), that could have still won the civil war. None of this was impossible.

And finally, the Kronstadt Rebellion could have succeeded (soldiers and sailors rose up with the slogan: ‘soviets without Bolsheviks’), although it wouldn’t have been necessary if the Bolsheviks had failed in 1917.

The point I’m trying to make is that there was a big slice of luck involved in the Bolshevik victory, in very slightly different circumstances, they could have lost, and that those different circumstances weren’t at all outlandish.

Some historians, such as Orlando Figes (A People’s Tragedy: The Russian Revolution 1891–1924) and Richard Pipes (The Russian Revolution), argue that the outcome of 1917 was highly contingent and that the Bolshevik seizure of power wasn’t inevitable. Democratic alternatives existed, including soviet-based or decentralised systems. Noam Chomsky also emphasised the suppression of more libertarian socialist possibilities in the revolutionary period.

The 20^th century could have been very different

Many Western leftists disbelieved or downplayed atrocities being carried out in the Soviet Union. George Bernard Shaw visited Russia in 1931, met Stalin and came back praising him. The position of many anti-capitalists was, more-or-less: ‘Wow, the Bolsheviks have pulled off a revolution! They may be a little authoritarian, but… they’ve pulled off a revolution!!!’ Revolutionaries all over the world were impressed. Anarchism declined, into a sideshow.

But just imagine what could have happened if the Bolsheviks hadn’t won. I’ll describe a few potential outcomes –- a global domino effect that’s pure speculation of course, but not complete fantasy. The fact that these things didn’t happen was largely down to the power of an authoritarian ‘Soviet Union’. In chronological order:

• Russia and Ukraine, 1920s: power resides in democratic soviets; anarchists are not crushed or expelled; workers and peasants maintain control of factories and farms. With a friendly Russian ‘centre’ (or lack thereof), the Makhnovists would likely have survived and consolidated their hold in Ukraine, holding on to their territory and creating a powerful anarchist beacon.

• Spain, 1930s: the anarchists of the CNT-FAI – the biggest workers’ organisation in Spain – prevented a fascist victory at the beginning of the civil war, took control of Barcelona and collectivized industry and land in Catalonia and Aragon. They were weakened by a lack of international support, and the USSR actively opposed them via support for the Communist Party (see Orwell, Homage to Catalonia, 1938). An anarchist Russia (a true ‘soviet union’) would almost certainly have provided the CNT-FAI with the resources and legitimacy they needed, potentially tipping the balance in their favour.

• Eastern Europe, 1920s-40s: between the world wars, peasant parties held power across Eastern Europe. Land ownership was based on smallholdings, and they were trying to develop small-scale industry scattered among the farms, producing things for each other. This was the opposite of the Soviet approach – large-scale agriculture and industry – so although they were fighting fascists, the Soviets didn’t take their side. They could have combined to suppress fascism, but didn’t, and so by 1939, all peasant governments except the Czechs’ had gone. (see David Mitrany, Marx Against the Peasants). After the war, instead of being forced into the rigid, Stalinist model of the USSR, the Eastern Bloc countries could have developed their own, decentralised forms of socialism, potentially influenced by a decentralised Russia.

• China, 1940s: the influence on Mao’s Chinese Communist Revolution is more speculative, but a different model of libertarian socialism dominating the global left would certainly have been a major factor. It might have provided an alternative to the rigid Stalinism that Mao often emulated.

• Korea, Cuba, Vietnam, 1950s-70s: there might have been anarchist revolutions, rather than communist ones, which could have influenced other countries in the Global South.

It’s conceivable that we might have had a largely anarchist world in the 20^th century, especially in the Global South. I’m not saying it was likely – just not impossible. A decentralised, commons or commons-like world would be even more possible now, with global support, new technology, no Soviet Union and the US in decline.

Conclusion

There are lots of ‘what-ifs’ in this article, but I just want to show that the Russian Revolution could have produced a decentralised, commons-like challenge to capitalism in the 20^th century. It’s speculative, but not crazy, I don’t think.

Capitalism suppresses commons via extraction, communism via forced collectivisation and crushing civil society. Communism is far from dead, and it’s often seen as the only real alternative to capitalism. I want to persuade anti-caps on the cusp of communism that there’s an anti-authoritarian, sustainable and achievable alternative.

Communists and capitalists can be members of the commons (as customers, investors or employees, all of whom are full members with democratic rights). Capitalists will find it hard to dismantle a system that brings benefits to many people, but where communists are able to seize power, I think they’ll probably suppress commons. Both left and right have created barriers for the commons, historically. Capitalism and communism create their own elites, with concentrated power that makes real democracy impossible. Commons does the opposite.

Communism couldn’t compete with capitalism – Hayek was right about planning. Also, in the 60s, the Americans and Soviets built proto-internets, but the Soviets closed theirs, because the communist party feared it would challenge centralised power. Big mistake. It was the thing that could have saved them. Without it, the massive bureaucracy involved in running a giant planned economy was impossible. By the time Gorbachev was implementing his reforms, the whole Soviet system was collapsing.

That doesn’t mean we have to have a capitalist world. Capitalism is disastrous for nature, democracy and community. Communism was tried extensively as a solution in the 20^th century, and actually made things worse. A non-capitalist, non-communist world is possible – systems don’t last forever. It’s time for a new approach for anti-capitalists – the commons approach. Build a better system from within capitalism, and transition to it. Marx was writing in 1844, when groups of people in Rochdale were starting to build the co-operative movement. That was a much more promising movement than communism or reform of the state.

But here we are, with capitalism still dominant, although looking more fragile than previously. 100 years ago, workers, peasants and anarchists struggled to co-ordinate and communicate at scale. We now have the internet and new tools / models to make it happen, that I’ll cover in more detail in upcoming articles.

Attempts at decentralised, non-hierarchical, truly democratic organisation keep surfacing, and they’re not going to stop. In the previous two articles, I tried to point out that Marx’s critique of capitalism was good, but communism in practice wasn’t, and in this article, that a commons / decentralised world isn’t pie-in-the-sky.

So far, I’ve tried to persuade anti-caps not to take the communist route. In the next few articles I’ll explain why I don’t believe the electoral route will work either, because states are captured and serve corporate interests.

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In this interview we look at the possibility of divesting from the conventional money system with its growth imperative by creating our own means of finance. A money commons, so to speak. It certainly isn’t easy! But if you listen to Stephen, it is also very much worth it.

If you fancy learning more about this topic in person, and exploring it practically first-hand, come to the fourth annual Collaborative Finance gathering in Austria if you can.

Find the video of the conversation below, then a summary and further resources, and finally the transcript.

Summary

• Stephen DeMeulenaere has been involved in managing and setting up community currencies all over the world for over 35 years. In recent years, this has involved projects based on blockchain technology.

• He first got interested in community currencies in the form of a Local Exchange Trading System (LETS) – the second of its kind – in 1990, in Victoria, Canada, when he was a student. This led to his lifelong involvement with this kind of exchange.

• It is important that a community currency is set up correctly. Far more of them fail than succeed. But even when they fail, in many cases people will have had very positive experiences and friendships from the time that they lasted.

• As Stephen sees it, we do actually want to compete – and this extends to aggregating wealth – but want to have egalitarian, cooperative and collaborative economic relationships, too. According to Bernard Lietaer’s observations, money can be designed in a way that’s competitive, or in a way that’s cooperative (Yin Yang theory of money). But that also means that cooperative systems should allow for some competition, too – the Yin has always a bit of Yang in it.

• But to go beyond a level of basic exchange with a community currency is a challenge in Stephen’s experience, although the tools for that are there. Buying a car, or a house, usually still happens in the mainstream economy. There are financial institutions that are built around the cooperative management of wealth, though.

• The global money system now resembles a casino, and creates structural inequality. That’s why community currencies should start handling larger amounts of wealth, according to Stephen. While people who use community currencies usually do not want to go beyond a certain scale, people in blockchain do! And they, too, want to transition to a different money system. But they are more competitive. This makes the work Stephen does really interesting. “We are bridging these two worlds between collaboration or cooperation, and competition.”

• At the level above consumer-to-consumer exchange, we can counter the “craziness” of the conventional money system, too. Mechanisms like invoice clearing and even commercial barter networks have a role to play in moving to a more steady-state-economy.

• The Regiogeld network Margrit Kennedy devised with the help of Bernard Lietaer aimed to move wealth from the national and transnational to the regional and local level. Lietaer was also involved in the transition of the European Currency Unit (ECU) to the Euro, but this did not work out how he had hoped.

• There is still a lot to gain from the ideas of regional and local currencies. “That’s why I’ve stayed involved in this, and many other people have stayed involved in this, because we know how awesome it is in a personal way. It’s life-affirming to be doing something like this. It’s an interesting life choice to make, because it’s not so much about enriching yourself, but helping other people around you to become more wealthy, or to meet their needs more efficiently, more easily, or with greater resilience.”

• The annual Collaborative Finance gathering, is happening for the fourth time this year (CoFi 4) at the Commons Hub in Hirschwang an der Rax. It will bring together people from different backgrounds in finance, community currencies and technology, and those simply interested, to explore topics like games, cosmolocal production, and implementation of local currencies over the course of a week, from 21 to 28 June. Participants come from all over the world. There are still spaces available. You can learn more about the gathering here:

  https://collaborative-finance.net.

  

• Blockchain technologies got a bad press, but some people point out their potential to create better economic solutions than what we have now, for example Joshua Dávila in the book Blockchain Radicals. What could be positive sides to them?

• Stephen has been working with digital currencies before Bitcoin. He was involved in the creation of Ripple, though not on the technical side. That was Ryan Fugger, who developed the model and code for what became Ripple. Ripple Labs later bought it and it became XRP. It was a pre-blockchain platform that did mutual credit digitally. Stephen participated in early discussions about how important it is that transactions are transparent and immutable.

• He heard about Bitcoin early on, but thought it was weird and didn’t understand it. But when he did, it started to take over his mind a lot more. Stephen sees the fact that issuing Bitcoin can not be directly influenced by humans – but by an open source algorithm that can be viewed by anyone – as a key trait. He likes that aspect of blockchain technologies in general, that they can’t be taken by the government.

• The most successful community currencies have in past years and decades in fact been shut down by federal or national government, or the national bank. This happened to a project that Stephen did in Thailand during the Asian monetary crisis which was shut down by the central bank of Thailand. It also happened during the Great Depression in Germany and Austria when the central banks of those countries shut down local currencies. We will need to “defend the wealth that we create and protect it in a way that can’t be taken by the government,” Stephen says, “until they are on our side – but there’s a bit of a hurdle to get over there.” Once our economies are large enough, we could develop ethical relations with the government while protecting generated wealth with the goal of creating a steady-state economy.

• We can do a lot with the technologies of today. Collaborative finance is a movement that does not belong to one particular ideology, not everybody has to think the same, “in that sense, I guess you could say we share more commonality with the black flag than with the red flag, but still, it’s open to to anyone who wants to move towards a more sustainable future”. Stephen points out that there are not that many “Blockchain radicals”, it’s probably less than five percent. But it is growing.

• One of the main obstacles might be to get people to join who are not much into tech. Stephen points out: “That’s because the technology is set at such an early stage. It still requires a change in thinking about how we use computers; and of course that’s what corporations want. Corporations want us to know as little about computers as possible. They want us to know as little about finance and money and banking and how it’s created, and how it’s being wielded against us. They want us to know as little as possible so that we’re powerless to be able to make any changes.”

• Blockchain and crypto are implicated in a lot of bad news, but people being greedy, selfish and awful is happening a lot in the general world, too. At the same time, other tech that is geared towards self-sufficiency, like solar punk, is generally not encouraged by governments, either.

• Stephen, with his co-author Scott Morris, published the book Pathways to Regeneration last year. The book can be downloaded for free. The book discusses how we can move to a better world that we know is possible. It takes inspiration from past currency designers like Bernard Lietaer and Margrit Kennedy, who were already mentioned, next to Jem Bendell and Michel Bauwens, who also write about transformative change. Stephen and Scott also look to Buckminster Fuller and E.F. Schumacher for a solid grounding in the foundational philosophy for the work that needs doing according to them. Going back to historical models, they aim to show how we can create models that work if they are grounded in proven practices from previous times. David Graeber is also referred to in that context. A key finding of Graeber’s was that in ancient times, humans did not just have one economic system and government, but different kinds alongside each other.

• The climate crisis might be a factor in forcing us to move to different economic systems from what we have now. Currently, governments are ignoring it in core ways, says Stephen, just making surface-level adjustments.

• One of the most important things to take care of when designing new economic models is good governance. Pathways to Regeneration is a lot about that, and Stephen emphasises that he and Scott are happy to talk to representatives of such initiatives. It is really important to look for help from people who have done this kind of work before. The Bristol Pound is an example, where mistakes could perhaps have been avoided, if that had happened at the beginning.

• What would be a good entry point for people to learn about collaborative finance, and money and finance in general? – Stephen says, it is best to start with books. He recommends Rethinking Money by Bernard Lietaer and Jacqui Dunne, and People Powered Money, which you can download for free. They are a bit older, and don’t cover blockchain, but are a very good foundation. You can find further helpful books under the following ‘Further Resources’ section.
  

Further resources

Books

• Pathways to Regeneration (free download) by Stephen DeMeulenaere and Scott Morris

• Blockchain Radicals by Joshua Dávila

• Rethinking Money by Bernard Lietaer and Jacqui Dunne

• People Powered Money (free download) by Community Currencies in Action

• Remaking Money for a Sustainable Future: Money Commons (free download) by Ester Barinaga

• Money: The Unauthorised Biography by Felix Martin

• Value Beyond Money by Diana Finch

• Breaking Together (free download) by Jem Bendell (listen to the audiobook version of chapter 2 here:)

Websites

• Monneta.org

• Monetary Diversity

• Ramics with the journal IJCCR

• Money and Society MOOC from 2015/16, with Matthew Slater and Jem Bendell

That’s why I’ve stayed involved in this, and many other people have stayed involved in this, because we know how awesome it is in a personal way. It’s life-affirming to be doing something like this. It’s an interesting life choice to make, because it’s not so much about enriching yourself, but helping other people around you to become more wealthy, or to meet their needs more efficiently, more easily, or with greater resilience.

Transcript

Katja: Hello, today I’m talking to Stephen DeMeulenaere. He has for over 35 years been helping communities design financial tools that strengthen local economies, support small businesses and build resilience.

You started with a LETS community in Canada and then you got involved with local currencies in Mexico and Argentina, and you also helped to set up complementary currencies in Thailand and then in Indonesia.

You have been involved in so many projects and also very varied projects, it’s really too much to mention, it’s quite amazing.

Some things that I found particularly interesting were: in 2004, you co-authored a paper with Bernard Lietaer – who is quite a big name in the community currency world, for people who are not that familiar – on how dual currencies in Bali help to keep the Balinese culture alive.

Also, in 2018 – so, later you got involved with blockchain – you organised a conference on blockchains for sustainable development at the UN. Those were just a few things. Do you want to add anything?

Community currencies – a lifetime occupation

Stephen: Well, thank you very much, Katja, for interviewing me today, and hello everyone, nice to have you with us on this conversation, or conversational journey that we’ll be going along here. Katja has prepared many questions. Some of them I might be able to answer and some of them I might not, but I will try to answer as many as we can and then we see where we go from there.

So, maybe I can just start by saying that I started my journey with community currencies in the very early 1990s. Actually, 1990, to be exact, when I came across a table for the Local Exchange Trading System at the Fernwood community market in Victoria, BC. So, everyone is there, selling their unwanted items on tables set out in the public square, or selling vegetables, or selling bicycle repair, because many people in the area would ride bicycles, things like that. And then there was a table for a currency system, a local currency system. And not all of the vendors in the market were members of the system, but they started to learn about it.

I was a university student in political science at the time, and I thought that’s very interesting. Sometimes we would see a table from the Communist party or from some of the Green party of British Columbia, and then this was something that was non-political, they weren’t pushing a particular political message but they were saying, no, actually we can create an economic system which is very different than the one that we live in all around us right now. And so I became very interested in that, and became involved in LETS and basically committed the rest of my life to it from when I was in my very early twenties.

Katja: And it was also right at the start of LETS, right? That was quite at the beginning.

Stephen: Actually, it wasn’t. LETS started in 1983, believe it or not. But it’s kind of one of these slowly… so for seven years, there was nothing really happening with LETS outside of Vancouver Island in the very Western side of Canada.

Victoria, the table for the system that I had visited that day, was the second system ever initiated, the second system after the first one that Michael Linton started in the Comox Valley on Northern Vancouver Island in a very very small remote town which is quite difficult to get to.

For seven years, he toiled away in obscurity, and then from Victoria – people started to hear about it in other cities, like Perth, Manchester, London and many others, Amsterdam and so on, through the internet. By the early nineties, there was the creation of Freenet through public libraries, so the very beginning of the bulletin board services that preceded the internet was how these ideas started to spread. Michael Linton was very tech savvy, and I was also quite – nowhere near his level – but as a young person, I was quite tech savvy with all of these new network technologies happening, and so I started to make friends in various places all around the world, many of whom are still my friends and to this day.

Katja: That sounds great and because you said, it would occupy you up to now: Why do you think it’s important to have local currencies – I assume you think it’s important.

Stephen: It’s important, but it has to be done right, and that’s been the biggest problem we’ve faced up until now. Because money is all around us and we think about it all the time, many people think, ‘I really don’t like these Euros, or these US dollars, or whatever national currency I happen to be forced by the government in the area I live in to use; I want to make my own. Let’s just go and make our own currency and convince people to use it and spend it.’ And then it crashes and fails miserably, and people might lose money, or they might lose the investment of time and effort that they put into it.

So, that’s what occupies me a lot: how to set things up right so that they succeed. Because there are far fewer examples of that than there are of failures. There’s thousands of examples of failures of community currency systems. That’s sad, and there’s reasons for it. At the end of the day, it means that the desire to implement them and to have them succeed is still there. Hopefully, we’re getting to that point where they don’t fail that often anymore.

That’s what keeps me involved and others as well, too. We want to be there when someone says, “I want to start a currency in Milan”, or in Geneva, or in Marseille, or Vancouver, or Montreal, New York and so on, and help them to do it right.

Katja: Though even if they fail – I was recently on a call with Ester Barinaga, and she said people are then more aware of what monetary policies are all about. And it also probably depends on how they fail. Do they fail after a long time, when people have probably had a lot of benefit from them nevertheless?

Stephen: That’s right. When I talk with people who have been members of a system that has failed – and I’ve been a member of a system that has failed – we remember the good times that we had when we were doing it, and people generally focus on the positive experience that they received from it. They made friends that they never would have made if they hadn’t exchanged or built. That social capital, that real social nominal that happens only when you’re exchanging what you produce out of love for something that someone else produces out of love, and those are wonderful things.

Katja: We also of course want them to last longer. Would you say, part of the reason is that we really – like the economy at large –, we need to create better systems and eventually it really has to have an effect that goes wider than just local implementations, community currencies. Could they get networked and federate?

Yin and Yang

Stephen: That would be the ideal. We need better governance structures to do that, yes, and it’s something I debated a lot with Bernard Lietaer and also with Margrit Kennedy as well, because she started the Regiogeld systems coming from her experience of community currencies in Germany.

The funny thing that seems to happen, from how I see it, is that we actually do like playing games and we do actually like competing in some way with each other, however small. That’s offset by our desire to also have some forms of economic relations which are egalitarian, or cooperative, or collaborative; and so we actually need a way of combining both of those in some ways.

And that goes beyond just saying I grow better tomatoes than you do, those kinds of competitive comparisons, but some kind of way of playing money games where it’s kind of like when we’re playing with poker chips that don’t have a value, or playing poker with pennies. It doesn’t really matter who wins, because the pennies are worth nothing, but there’s still something like, ooh, I did a little better then someone else.

And that extends into how we look at wealth. Wealth is sort of the next level of money. So money is a medium of exchange that we use to exchange goods and services between each other, and capital or wealth, that’s something that’s aggregated, it’s money that’s been brought together, and a lot of people who work with community currencies are scared of that. They’re scared of wealth, and so they say, “oh, I want to exchange with my neighbours for vegetables and bicycle repair or haircuts and massage and acupuncture”, but when it comes to buying a house, or a car, or something that takes a lot of money, they still often leave that in the space of the mainstream economy. There have been people who – there’s JAK bank in Sweden, and there are of course the ethical banks, cooperative banks like – I mean, Rabobank is huge – so, there are financial institutions that have built up around the idea of cooperative management of capital and wealth, but usually that doesn’t happen within the community currency space.

I’m still trying to wrap my head around it, but I had debates a lot with Bernard and Margrit about this, because Bernard always talks about the idea of Yin Yang in money, the Yin Yang dichotomy, where money can be designed in a way that’s competitive, or it can be designed in a way that’s cooperative. But as we know from the Yin Yang, there should be elements of cooperation within the competition and competition within the cooperation.

Katja: One thing I wanted to say: competition is one thing, but the money system as it is at the moment is not only competitive. I mean, to me it looks like it’s gone really out of hand. Like, the financial casino – Ann Pettifor has a book out, The Global Casino, and then also, that was one of Margrit Kennedy’s big things: the compound interest.

So, the money is created as bank debt, and then people get more and more into debt, and the gains always go to the top. That is not competition as such, that is something more.

Stephen: It’s structural inequality that the money system creates. And that’s why we should, on the community currency side of things, we really should be trying to learn how to handle larger and larger amounts of wealth, I mean to bring even that scale of exchange into a community currency system, and it is possible to do that.

We have examples of it, we have the tools, the governance, the laws, because you are of course starting to interface with the financial system and the government, and when you’re at that level, you have to play at that level. We can totally do that, and keep the local scale aspect in place as well, too. But it’s still that a lot of people in the community currency space are not willing to go there yet.

But the people in blockchain are. We can come back. We can still talk more about community currencies and come back to talk about how blockchain technologies fit into this whole transition towards a new type of monetary system, because that’s what they want as well, too. Even if they’re more competitive about what they do and don’t think as cooperatively or collaboratively as we do in our space – which makes what we do really interesting.

We are bridging these two worlds between collaboration or cooperation, and competition.

At the middle level

Katja: That’s an interesting way of looking at it. I just briefly wanted to mention: there are maybe also other levels. I mean, for example, Local Loop Merseyside and Stroud Housing Commons. They are going one level up, to the medium level, and also bringing together different parties in a way where you can do with less cash so to speak, or don’t have to take out a bank loan. So, that would also be examples, so maybe it has to happen on many levels, and involving local municipality would be good probably.

Stephen: Actually, I’d be happy to talk more about that next level as well, too. So, with community currencies, we have that C to C, consumers. Producers and consumers. It’s kind of like what Alvin Toffler was talking about in The Third Wave, where his prediction was that in the future we would become producers as well as consumers of the goods and services around us. But it didn’t quite work out that way, or hasn’t yet quite worked out that way.

There’s still a level above the consumer level, of businesses that do the majority of production within an economy, and yes, we have cooperative banks, we have these invoice clearing systems, like you were just giving the example of Local Loop Merseyside, we have business to business barter. There’s many billions of dollars in trade being done through those levels of systems run by very professional administrations. These are financial professionals that are used to putting on suits and being at work at eight thirty every morning for their entire lives and such.

But that’s an important role that needs to be played if we’re really going to transition to a more steady-state economy, or even get into discussions about degrowth and how to actually start stepping back the economy because of all this casino craziness, while still maintaining the quality of life that we have right now, so that you can still have that beautiful red wall behind you, and a bookshelf, and pictures on the wall and such, and everything is in fine shape or type. Degrowth doesn’t mean that we have to walk around wearing twenty-year-old pairs of pants with holes in the knees or things like that. We can actually have a very nice quality of life and just remove all of those other things that are causing so much damage.

Katja: So, the cooperative way of doing trade has to increase proportionally to the competitive one, and also somehow get rid of the craziness as you called it. I sometimes think all the cooperative things going on almost helps the casino go on, because they are kind of counter-balancing it. It might have already come down and collapsed otherwise, and maybe it still will, but of course, what we can’t prevent is those boom and bust cycles, and how many people are affected by them. And that is maybe one of the first things: to get rid of the extraction and all that.

Stephen: And that is what Margrit Kennedy was trying to do by starting the Regiogeld network in Germany: to take a lot of the wealth away from the the level above the regional, so the national and transnational level, and move that wealth into the regional and local level using the local currencies that Bernard Lietaer was trying to propose. So, they worked very closely together to formulate how this would look, and how this should work in practice, when the Euro was being created.

As I think you know, and I’m not sure if the listeners know, Bernard Lietaer worked on the convergence mechanism of the ECU to the Euro for the Belgian central bank. He was deeply involved in the transition of the European monetary system from one of multiple national currencies to one that was unified. As we know from what happened in Greece, and what’s been happening with Italy and Spain and Portugal, the way the Southern countries in Europe have been treated compared to those in the North, that things haven’t worked out in the European banking system as Bernard would have hoped.

He was hoping for a much more egalitarian form of monetary issuance that wouldn’t be dominated by the larger financial powers in Europe and so things haven’t quite gone…

Katja: I think it was also not his system that was implemented. I don’t know if that played a role in that. I think his was a precursor.

Stephen: Yes, it was a precursor, but he had been lobbying very hard to change the way that money would be issued – that the Euro would be issued. It would still be issued through loans. That would be hard to break. It’s too early to bring in a new currency and then completely change how it’s being issued into the economy, but at least, there would be mechanisms that would make it more egalitarian between the countries, which we’ve seen hasn’t… It’s gone the way it’s gone in Europe.

Katja: And I think that was partially also a consequence of the global financial crisis that these things happened.

Stephen: Absolutely. But if we go back to their ideas, to regional currencies and local currencies, there is still a lot – we can gain ground back again, if we take it seriously and understand why we’re doing it. That’s why I’ve stayed involved in this, and many other people have stayed involved in this, because we know how awesome it is in a personal way. It’s life-affirming to be doing something like this. It’s an interesting life choice to make, because it’s not so much about enriching yourself, but helping other people around you to become more wealthy, or to meet their needs more efficiently, more easily, or with greater resilience.

And those are all great things that are worthy to do in our lives I think, which keeps me motivated, and I hear similar stories I’m sure from you, and from others who attend the collaborative finance gathering, that this is what keeps them so committed to this kind of work.

Katja: It also matters I guess when they spring up in times of crisis, they are more significant than having a LETS scheme somewhere.

Stephen: Oh, absolutely. LETS is a nice introduction to how these systems can work. It’s egalitarian, it’s fun, you get to meet nice people in your neighbourhood – all the nice people in your neighbourhood will belong to it, and almost none of the not nice people will belong to it. So, it’s fun that way. And then we can build other things on top of that. That’s what I’m excited about and happy to help communities to do.

CoFi

Katja: You mentioned CoFi. That is the Collaborative Finance gathering that is happening for the fourth time this year in Austria in June; I went last year, and I really enjoyed it, and I learned so much, and it was really amazing. It is also a real commons, at a place called the Commons Hub as well.

Stephen: Yes, absolutely right. The second one that we had before last year was a lot of fun. It was held in Belgium, and we stayed together in a dormitory and we did all of our cooking and cleaning and such in teams. We do the same at the Commons Hub with the Crypto Commons Association which is the umbrella organization that CoFi is a part of – although we are not all one hundred per cent supportive of crypto.

As you recall, there were quite a few people who attended last year who were completely against technology; completely against money. They think that we should only exchange everything that we have as a gift. So, that’s the the great thing about the Collaborative Finance gathering, that it’s completely open to all kinds of thinking about this area, but within a space that says: if we’re really going to get serious and and scale up then we’re probably going to be going towards the blockchain in order to do that.

Katja: Can you otherwise say a bit more about what the conference does and who should attend it?

Stephen: Well, it will be held from 21 to 28 June in the foothills of the Alps, in the Rax mountains. They’re still pretty big, but they’re not the really really big ones, in Eastern Austria. It’s a beautiful natural area, and this year will be focused on five main topics, which wouldn’t mean too much if I explain them to you. We will look at workshops and games – how people can introduce these ideas in a fun setting in their communities. Fun and educational, of course. So, there’ll be quite a few games being played. We will look at cosmolocal production, which is a way of how we are localising production, or regionalising it, to revive dead towns which is actually what Hirschwang is – a dead or dying town – and there are a lot of towns like Hirschwang in Europe, in Italy and Spain and Portugal and such, where the population have left, but the rail line is still there. There’s a former hydroelectric dam which is not being used anymore and such, so those can be revived under new economic models that may not work for capitalism, but they work just fine for the kinds of purposes that we have in mind. That kind of thing, and of course we’ll be talking about governance and how to design the administration of these systems so that they can be transparent yet effective – resilience, yet efficient.

We’ll talk about technologies – on how some technologies can possibly assist; so there’ll be some people who have developed technologies that can serve these kinds of ends and we’ll be learning about those. So, anyone who’s interested in implementing in their community. I would say, if they have some experience in that – many of our members have worked with financial institutions in Europe like GLS bank, or Raiffeisenbank, or Rabobank. I mean, they are banks, but these are credit unions or ethical banks.

So, we have a number of of people with backgrounds in these kinds of financial institutions coming. Municipalities and regional governments, and then people who just have a deep interest in the space from a religious or philosophical, ethical, political perspective.

Katja: So, you can attend if you just have an interest in the space of alternative currencies, alternative monetary systems.

Stephen: And we still have plenty of room. We still have room for about thirty more people to sign up on our website at collaborative-finance.net.

Then, if the listeners have any questions, they can send us an email and say, “would this be suitable for me, this is what I want to do.” I should mention as well, too, that we hope to have more regional gatherings again, like two collaborative finance events a year, is what we’ve been wanting to have for a long time. We will have the June event in Austria every year. That’s the main annual flagship event, and then we would like to have regional events in different parts – I would say mainly in Europe, because that is where we find the broadest support. But if there’s another part of the world where there’s a lot of support for these kinds of monetary and economic systems, then we could consider having a regional event there as well, too.

Katja: That sounds great. And CoFi, of course, has very international participation, that’s great about it as well. People coming from all over the world.

Stephen: Oh, absolutely. We’ve had people come from China, Taiwan, Japan, Indonesia, Thailand – you know, from Southeast Asia, and we had a number of people coming from North America and Central America, South America and Europe, and Africa as well, too. But I would say, the focus now – I just think that for some reason, Europe is just a little bit further ahead in this space than the other areas, in general.

Blockchain

Katja: Okay, then let’s come to the blockchain. That has got a bit of bad press, mainly because of Bitcoin becoming more a speculative asset, other cryptos as well, but there’s much more to it. There’s also a book I have been reading called Blockchain Radicals by somebody who has a podcast called The Blockchain Socialist, Joshua Davila. I’ve almost finished it now, but it’s really interesting – and we should talk about your book as well, of course. I’ve read that, too.

Maybe – can you just say what piqued your interest and then the journey, seeing how it developed, and why do you still believe in it, and what do you think it could do.

Stephen: I had been working with digital currencies before Bitcoin. I was involved in the creation of Ripple. Not technically. That was Ryan Fugger, who developed the model and the code for what became Ripple, which was purchased from him by Ripple Labs to become XRP and such. It was a pre-blockchain platform, but it was a way of doing mutual credit digitally. So, I’ve been involved in the early technologies behind blockchain and participated in those discussions about the importance of transparency in transactions, and immutability, that transactions could not be struck or rewritten once they were locked into a database, and things like that. So, I heard about Bitcoin when it came out. I saw it on SourceForge right away, because I was already an open source software lover and user.

But I thought it was weird. I didn’t understand it. I didn’t like it, and so I waited a few years before I became involved in it. And then, as I understood it, then it took over my mind a lot more. About how, if it’s managed properly – the limitation of issuance which I think is very important. Especially algorithmic: the issuance of Bitcoin cannot be controlled by humans, it’s set out by the algorithm of the software program which is open source and can be viewed by anyone. So, I think that’s fascinating, that we have a multi-trillion dollar asset whose software layer is not locked behind a corporate firewall, and that there’s no CEO or board of directors really calling the shots. I mean, there are people who can kind of call the shots, but they don’t have the final word if the community disagrees.

So, I like that aspect of blockchain technologies, and that it can’t be taken by the government, which I think is the most important aspect, because that’s what’s destroyed – I mean that’s what’s taken down the most successful community currency efforts in past years and decades; just simply being shut down by the federal government, national government, or the national bank. Whether that was a project that I did in Thailand during the Asian monetary crisis which was shut down by the central bank of Thailand, or what happened during the Great Depression in Germany and Austria when the central banks of those countries shut down those local currencies as well. So, in order to survive that battle, we will have to be able to defend the wealth that we create and protect it in a way that can’t be taken by the government. Until they’re on our side – but there’s a bit of a hurdle to get over there.

Which may come. It depends on us building our economies large enough so that it actually means something in terms of affecting how the national economy functions, and then developing proper ethical relations with the government, and, if necessary, protecting the wealth that we have generated and are continuing to generate, with the goal of creating a steady-state economy which is in harmony with the natural world and sustainability. If governments don’t want to do that… – because at the moment they talk like they want to do that, but they don’t really want to do that, because, of course, corporations will revolt on them, and they’re more scared of corporations than they are of groups of people.

We have the tools now to be able to direct things the way that we want to direct them if we choose to take that action. Of course, it’s not up to you or me, and there’s no red flags anymore, or black flags, waving in the background. We’re not trying to create a homogenous movement where everyone has to think the same. So, in that sense, I guess you could say we share more commonality with the black flag than with the red flag, but still, it’s open to to anyone who wants to move towards a more sustainable future and I think that’s where the defining point really is, rather than saying, you have to be a socialist, or an anarchist, or a leftist.

As we know from blockchain technologies, there are not that many blockchain radicals actually, in the blockchain space. It’s a significant minority across the board in fact.

Katja: But it’s a significant minority.

Stephen: It’s growing because we are reaching out and finding each other, and starting to build our tools together, right. It’s tiny. Not a significant minority, no. It’s still less than five percent, I would say. People thinking about blockchain in these ways make up about five percent or less of all blockchain users in the world.

Katja: But that is still not so few, I mean, five percent of all blockchain users, I think. But is one of the main obstacles maybe to convince people who are not into tech to take part in it?

Stephen: That’s because the technology is set at such an early stage. It still requires a change in thinking about how we use computers; and of course that’s what corporations want. Corporations want us to know as little about computers as possible. They want us to know as little about finance and money and banking and how it’s created, and how it’s being wielded against us. They want us to know as little as possible so that we’re powerless to be able to make any changes.

So yes, I can understand that when someone opens up Youtube, they see a lot of videos about how Bitcoin is a scam, and they read in the news that these people have been hacked, and there’s all these criminals in jail that Trump has pardoned for their criminal behaviour using crypto-currencies and blockchain technologies.

That’s awful, but there are a lot of greedy, selfish, awful people in the world; not only in the blockchain sector, but in the regular world as well. It’s almost the same, it’s like Pareto’s law.

Katja: So that’s why we need to create systems that are co-governed and are transparent. And can you see a way how – let’s say a community living on the land – how could they use something like that. So, if there was an interface of, let’s say there are people who know about the technology and can explain it in a good way, do you think they might be able to convince people? And I don’t want to say everybody living on the land is not tech tech savvy, there are lots of people who are.

Stephen: No, that’s why we have solar punk. There’s solar punk. They are pretty advanced with energy generation and in other applications of technologies which are also to a large part being suppressed in a lot of places. And people have to learn about water and wind, and solar power technologies, pretty much by themselves. Here in Indonesia, the government actively opposes the use of solar power.

Katja: It opposes the use of solar power?

Stephen: Yeah, actively. So, you take a lot of risks – you can buy solar panels on the market, they haven’t outlawed them, they haven’t gone to that extent but they they make it difficult in every other way to have solar power in a country which is close to the equator and has sun most of the time, very hot sun.

Book Pathways to Regeneration

Katja: Maybe let’s talk about your book.

Stephen: Our book is similar to Blockchain Radicals in a way, and to a number of other books that have come out in the space in recent years. In that way, we are discussing how to get towards a better world that we know is possible.

We take a lot of inspiration from Bernard Lietaer and Margrit Kennedy, and Jem Bendell who wrote a book on climate collapse called Breaking Together and Michel Bauwens who is in Thailand and writes the Fourth Generation Civilization blog on Substack and has been talking about how to change the mode of production for a long time.

So, we look at what these people have been saying, and then bring in Buckminster Fuller and E.F. Schumacher and the really big names. Many more people know Buckminster Fuller and E.F. Schumacher than they do Bernard Lietaer or Margrit Kennedy and such. Because they provide a very solid grounding in the foundational philosophy of why we need to do what we’re doing, and how to do it right.

And so we draw a lot from them on applying Indigenous wisdom, whether that’s how things used to be in Europe for your grandparents and great-grandparents, or in Canada where I’m from, with my grandparents and great-grandparents, how they lived. Or we can go back five hundred years, a thousand years, two thousand, five thousand, ten thousand years, and look at how societies functioned, and what elements of how those societies function do we still know about today, and how do we encode those into economic and monetary systems that we use.

Because those will have the most resonance with how our life works. We will know innately, we will feel, ‘oh yes, this makes sense,’ rather than saying, ‘this seems really alien to me.’ When we can make blockchain technology feel like that, then people will feel like it’s something that they can use, and it’s not something that’s completely alien to them like something that has just come from outer space, brought to you by aliens; but something that actually relates to how we really used to operate economically and there are a lot of similarities in blockchain technologies with that.

Katja: That is an interesting point.

Stephen: So, we draw that line directly in the book. It might not be easy to see, but we hope it’s at least seen between the lines, and one other author we use for that is David Graeber, especially his book Debt, the First Five Thousand Years and The Dawn of Everything, which is a huge book. But it’s really amazing in how it takes ancient anthropology and archaeology and helps us to realise that we didn’t have just one type of economic system in ancient human society. We had many different kinds. We have many different kinds of government. We had many different kinds of leadership. We had many different kinds of mobility.

Some leaders then would allow people to walk away if they didn’t agree. Or some wouldn’t. And some people could get on a boat and sail, and some people had to walk, and some people had to go to get in a canoe and go down a river to escape whatever society had gone toxic for them. Which is something that we’re not able to do now. We can’t say, “oh, I don’t like what’s happening here in Canada, and I want to go to Indonesia.” Governments make it extremely difficult. Now you have to be a taxpayer in some country of the world. You have no freedom to be a non-taxpaying human being on Earth right now. Everywhere you go, you’ve got to be registered as paying some government money, and they impose that on each other, to make sure that that happens. So that they keep each other all in business.

So, we talk about that in the book. What needs to be dismantled, or rearranged, and how we can go about doing that, and what are some of the challenges and opportunities that we may be facing, that will force us to do that. And we think that the climate crisis is really what that challenge and opportunity is going to be.

I was watching a TV programme the other night about how temperatures in Thailand would be above 35 degrees only maybe five days out of the year, and now it’s almost 60 days of the year where the temperature is above 35 degrees somewhere anywhere in Thailand as a country. And that they are already facing temperatures of 60 degrees Celsius, which is becoming unbearable, so it becomes kind of like – we’re faced with a possibility in the near term of an event kind of like what Kim Stanley Robinson wrote about in his Science Fiction book

Katja: What is that, I don’t know that book. What is the event?

Stephen: It’s a red bulb event, where the combination of heat and humidity becomes so high that people die in their thousands or the hundreds of thousands. So that’s the catalyst in Kim Stanley Robinson’s book. It’s an excellent book and worth reading, and the steps that people who experienced it, or whose job it was to protect humanity, as staff of the United Nations, and how they failed to do that, and the reasons for that failure, which is basically government ignorance of the situation because it didn’t serve them.

I heard a saying recently that it’s hard to get someone to see something unless their salary depends on it. So, if the government is not making money from the climate crisis, it’s going to be very hard for them to actually take a look at it. That’s the stone that the builders are refusing right now. They’re mostly ignoring the climate crisis in a core way. They’re just saying, “oh well, we’ll provide some rooms that have water and air-conditioning in them, and we’ll show people where they can escape to if they’re having a heat stroke emergency,” but

when it comes to whether or not we should grow more trees or ban cars or something like that, well, we can’t go there because corporations would get upset.

Katja: You could also say that the climate crisis is acknowledged in some ways, but then turned again into something that the industry can use like carbon offsets and things like that.

I think we’ve come to the end but I wanted to ask something specific about the book as well. So, it is actually a lot also about the social side of things, right? How you govern things, because that is an important aspect, that it is a real democracy, not too hierarchical governance.

Stephen: As I was mentioning in the beginning of our conversation today – I was talking about how important governance actually is, and how little people actually think about it, because they’re busy thinking “ooh, this new money experiment is exciting. Let’s just design a new currency.” And they go into a meeting, and they say, “okay, do you second my motion?” using Robert’s rules or some old-fashioned form of governance, and they say “no, I created this system, you do what I tell you. I don’t care what you think. I created this. If you don’t like it, go somewhere else.” Which is actually what happens in community currency systems, because people don’t know that there are actually better ways of doing governance. And so we have seen a lot of systems collapse because of this kind of toxic governance behaviour.

I mean, that’s just one of many reasons community currency systems can collapse, but we can at least solve some of these problems. We have solutions here. My co-author of the book Pathways to Regeneration – his name is Scott Morris – we’d be more than glad to talk to any communities – and I say this in every podcast or conversation I have – we’d be happy to talk with any representative of the municipality or regional government, or even larger scale, or lower scale; neighborhoods – if you’re in a neighborhood government and are interested in implementing these kinds of systems, reach out to us, and we’d love to do what we can to assist and make sure it’s done right so that it has the best chance of surviving.

Because I’ve been at this for 35 years. There have been people like my colleague Thomas Greco, who is in his 80s now, who have been doing this for way longer. He was friends with E.F. Schumacher and Bob Swann and Susan Witt in America from that side, and of course, there are many people in Europe who are ten – you know, I’m nearly sixty – so there are people who are 10, 20, 30 years older than I am, with even more experience, that also have been through this enough times to know how to do it right.

So, I’m not trying to say that I’m the only person, or this is an innovation, that kind of thing. I’m not trying to sell myself as being the only solution to this. There’s actually a lot of people that have an important contribution to make, helping these systems to get started properly.

Katja: That’s really good, to have a variety of opinions. The message I guess is, to not just start and also, don’t dictate things. Talk to people who have done this before, and have been doing this for a long time.

Stephen: I can’t stress that enough. Because that’s what often happens. We often find out about these systems once they’re collapsing. And we say, “oh, we didn’t know that there was a system there, no one had ever contacted us. So, when we saw the Bristol Pound was a very big collapse several years ago, and then I was like, “oh that’s too bad, they never reached out to me. I still had 25 years experience then. They didn’t reach to my colleagues. That’s too bad. Maybe we could have done something that would have helped it to survive, instead of reading the post-mortem book.

Katja: Yeah, I’ve read that as well. It’s interesting. There was so much enthusiasm, and they’ve done good things as well.

Stephen: It’s wonderful people. I’m not criticising the people personally one bit. They are very kind, generous, have huge hearts, but they thought they knew what they were doing, and they didn’t. Sad.

But it’s a good example. And it’s important that we be honest and open about these kinds of things that have happened. Rather than say, we shouldn’t talk about failure, whereas on the contrary, we really should talk about failure, and why these things happen so that we

can be collective in how we develop responses to it.

Katja: Diana Finch has also said, if anybody wanted to try something like that again, to reach out to her. She only came in towards the end anyway..

Book recommendations

Maybe, as a last point, anybody who doesn’t know very much about community currencies or the monetary system, finance system – can you recommend an easy entry point, on how to learn these things.

Stephen: Well, I really think it’s in books. I would read Bernard Lietaer’s book Rethinking Money. That’s a really wonderful book that gently introduces the concepts, the philosophy, the mechanisms and so on. And if you want to go a little bit deeper, then I would suggest finding the book People Powered Money by the New Economics Foundation in the UK.

That book was written by a whole large group of practitioners across Europe about 10, 15 years ago. I wasn’t involved in that project, but many of my colleagues were and I think it’s an excellent piece of work and explaining in even more detailed terms about how to implement community currencies, but it’s just a bit out of date because it is before blockchain technologies. If you can survive reading those two books then you should already be at a point where you can start finding your way and knowing what questions to ask to find people and resources around. Or just contact you, Katja.

Katja: Yeah, I also have some book recommendations from my side.

Stephen: What would your top recommendations be?

Katja: I think the book that Ester Barinaga wrote which is Remaking Money for a Sustainable Future: Money Commons

Stephen: That came out six months ago, isn’t that right.

Katja: It is also available for free as an ebook or pdf.

Stephen: As is ours. As is People Powered Money

Katja: Yes, I’ll put the links in the description. I would recommend yours as well. I really got a lot out of that as well. And for money history, there’s a book that came out in 2013 by Felix Martin, called Money, the Unauthorised Biography, I think.

And I think as a website monetta.org is quite good. And that is one that Margrit Kennedy founded, and I just saw yesterday that they have quite a good explanation on the home page on what is wrong with the money system, and then the various different approaches to tackle it.

Stephen: Great, and I would also recommend Breaking Together by Jem Bendell.

Katja: Yes, I read that as well. Chapter 2 is all about the money system, right?

Stephen: And he covers the reasoning for why we need to change the monetary system as soon as possible in there. I think all of those books are actually the best way to start rather than – I mean, yeah, Monetta’s website, too, of course.

Katja: There are probably other websites, I just happened to be there yesterday.

Stephen: Websites are created out of a more specific interest than a book. A book needs to appeal to a wider range of possible readers, whereas a website might take you down the wrong path. Monneta is a broad enough path, but other ones – you run the risk of becoming quite focused on Transition Town movements or mutual credit systems or credit common systems that use very specific types. Whereas as you may know, or not know, there is a strong movement or tendency towards monetary diversity and that, as Bernard Lietaer was a great big fan of, not just the duality between competitive and cooperative currencies, but a multiplicity of currencies each fulfilling specific roles that they’re best designed to do, right?

And this is actually what economists say: that monetary systems should be designed to achieve… they should be efficient in the ways they achieve what they’re best at achieving, and not be used in ways that they are not best at and most efficient at achieving, but we treat it like they are. Like in the money system, there should only be one currency, but in fact there should be at least two or five or 10 or 20 different currencies circulating at the same time, all for different purposes, and I’ve seen in real-world contexts and it works very very well.

It actually does. People think, ‘oh I’d be completely confused in a world with ten different currencies in my wallet or in my phone,’ and actually, no. You get used to it, you’ll sort it out very very fast.

Katja: It will be interesting to see what the future will bring.

Stephen: Yes, always looking forward to it.

Katja: I think we can probably finish here, we’ve covered a lot of ground. Thank you so much for joining me, it’s been really interesting talking to you. And I’ll see you in June, or maybe online before that.

Stephen: Yes, thank you, Katja, for an enjoyable conversation. I hope your listeners enjoyed it, look forward to seeing their comments, and yes I’ll see you at the end of June in Hirschwang in Austria at the Collaborative Finance gathering.

Contents

1. The crash of 2007-8

2. The current situation

3. Where does money come from now?

4. Financial intermediation

5. Fractional reserve

6. Credit creation

7. The symbiotic relationship between state and banks

8. The future

Here’s part 3 of a very quick history of money, to counter claims that ‘money evolved from barter’, or ‘Kings introduced coins so that their subjects could trade more easily’. Money, our means of exchange within capitalism, is also used to store value, and so stored it is - billions are accumulated in the hands of very few, taking the exchange medium out of circulation and effectively destroying democracy in the process. In a commons world, we could do much better.

Part 1 (3000BCE to 1400).

Part 2 (1400 to 2000).

The crash of 2007-8

This is an overview of the build-up to the global economic crash of 2007-8 — especially the role of banks:

1970s

• Lewis Ranieri of Salomon Brothers invents mortgage-backed securities (MBS).

• Mortgages are sold to investment banks, who package thousands of them together as securities.

• They sell the securities to third-party investors, who receive the cash flow from them.

• Because they’re large packages, they give much higher yields than individual mortgages, but with less risk, because most people pay their mortgage.

• So they catch the eye of large investors.

1980s

• Lots of legal wrangling, but MBSs become legal, as long as they’re given a good enough rating by a ratings agency.

• MBSs get triple-A ratings, make billions, and change the image of banking from Captain Mainwaring to cocaine and strip clubs.

• Banking becomes the dominant industry in the US and the UK. Bankers successfully pressure governments to deregulate their sector.

• Lots of different types of securities appear.

1990s

• Credit default swaps (CDS) are developed – insurance policies against default on debts. You can take out a CDS on anything – they’re, in effect, bets against debts being paid.

2002

• Dotcom bubble bursts. Economy wobbles, but housing seen as stable and secure (it isn’t).

• Banks push for more and more mortgages for MBSs – even from people who are big credit risks.

• If housing securities are recognised as risky, and don’t sell, they’re taken apart and repackaged as collateralised debt obligations (CDO).

• CDOs are types of derivates (their value is derived from something else – in this case the collateral if the loan defaults).

• Ratings agencies give them triple-A ratings, or they lose business to other ratings agencies who will.

• ‘Synthetic CDOs’ arrive, which are bets on other CDOs; then there are bets on those bets, and so on.

2003-4

• Hedge fund manager Michael Burry (featured in the book and movie ‘the Big Short’) and others, notice that a lot of MBSs are full of sub-prime mortgages.

• Burry begins buying CDSs on housing securities.

• He’s right, and makes a lot of money as the MBSs start to fail.

• Burry ‘short-sold’ housing securities – i.e. he bet against them.

2007-8

• MBSs have morphed into a huge number of dodgy securities.

• A large number of them fail, and crash the economy.

• Ben Bernanke and Hank Paulson bail out the banks.

• No bankers get jail time (apart from in Iceland).

• Bankers lobby governments to kill any meaningful reform.

The current situation

Currencies are no longer pegged to anything – so there are crises involving wild fluctuations and massive devaluations. Plus there’s currency speculation. The foreign exchange market is huge, and almost all based on speculation. Currency speculation is not only parasitic, providing nothing useful, but it’s an activity that thrives on instability. The more the value of currencies rise and fall, the more opportunity there is for profit from speculation.

Should we go back to the gold (or silver) standard? Of course not – why base the global exchange system on a commodity that has to be dug out of the ground, often in terrible conditions, often by children, causing lots of environmental damage, to be stored in the vaults of banks and concentrated in the hands of the already wealthy? It makes no sense when we have credit clearing and mutual credit.

Where does money come from now?

It’s incredible that there isn’t general agreement about how money is created (although I think we’re getting closer to it now). Money is a human creation. How can we create something and then not agree on how it’s created? There’s agreement about how stars are formed, and that’s much more complicated – or maybe it isn’t. Maybe the mechanics of money creation are more difficult to understand than the mechanics of star creation; or perhaps the waters have been deliberately muddied.

There are 3 theories of banking and the creation of money: the financial intermediation, fractional reserve and credit creation theories.

Financial intermediation

Textbooks often quote the FI theory, where banks take deposits from savers, and lend them out to borrowers. Presumably, money is assumed to come into existence only when governments print notes or mint coins. Banks make their profits from the interest they charge to borrowers, which is more than the interest they pay to savers. When this was generally discovered to be incorrect (although probably the majority of people still believe this is what happens), some textbooks started to quote the fractional reserve theory.

Fractional reserve

According to this theory, banks lend out more money than they have on deposit from savers (in the same way that goldsmiths lent out more notes than gold in their vaults to back them), as long as they keep 10% of the money they receive in reserve at the Bank of England. Then the ‘money multiplier’ effect kicks in to boost the amount of money in circulation. It works like this. Say a bank receives £100 in cash from a depositor. They keep £10 in reserve and can lend out £90. The borrower then (probably) buys something with this loan, and the seller deposits this money with their bank. Their bank sees this as ‘new’ money, keeps £9 in reserve and lends out £81 – and so on. In the end, almost £1000 is pumped into the economy from an original £100 deposit. The banks profit hugely by charging interest on money they didn’t have. In this model, the central bank can tweak the amount of money in the economy by changing the reserve ratio. In the example above, the ratio was 10% – the banks had to keep 10% of deposits in reserve. The central bank could increase the money supply by dropping this to 5%, say, or reduce it by increasing the reserve ratio to 20%. However, this model isn’t correct either, although you can find plenty of economics textbooks that say it is.

Credit creation

There’s no fractional reserve banking in the UK. Now banks can lend as much as they like, with no reserve requirements whatsoever, knowing that they’ll be bailed out if it all goes horribly wrong. The amount they lend is only dependent on the banks’ confidence that borrowers will pay it back. Banks have a government monopoly on the creation of money as credit, or if you like, as debt. So when someone borrows money from a bank – for a mortgage or a business loan – that’s when most money is created, out of thin air. This seemed unlikely to many, until it was proven by Richard Werner, and the Bank of England confirmed it in a bulletin in 2014.

It’s all accounted for with double-entry book-keeping. Banks register a £1000 loan as an asset – because someone then owes them £1000. But when they make the loan, they deposit £1000 into the customer’s account, and money in an account is a liability – a promise to pay. So the asset and the liability are for the same amount, and therefore cancel each other out, and nothing seems to have happened, even though there’s an additional £1000 sloshing around in the economy. This accounts for around 97% of all money in existence. Less than 3% is provided by the central bank when they print notes and mint coins.

We’ve been here before, by the way. Early banks used to issue their own banknotes (as promises to pay gold when demanded). They then charged interest on this magic money, until, in the 19th century, the Conservative government of Robert Peel attempted to stop banks lending and charging interest on money they didn’t have, by bringing in the Bank Charter Act of 1844, after which only the Bank of England could issue bank notes. However, the act didn’t prevent banks from lending money by creating deposits in customers’ bank accounts. Customers could pay for things using cheques, and no banknotes were required at all.

Positive Money conducted a poll of MPs, and found that 85% of them didn’t know where money comes from, which is a bit of a worry. J K Galbraith said that “The process by which banks create money is so simple that the mind is repelled”. Maybe that’s what it is – people hear it but can’t really believe it. But I think that’s changing now.

The symbiotic relationship between state and banks

Governments don’t have control over the total amount of money in the economy. That’s down to the activities of banks, although states and banks now have a symbiotic relationship. Banking is perhaps the least trusted of professions (with the possible exception of politics). Banks don’t share their profits with taxpayers, but their losses are forced onto us. They make big decisions that affect everyone in the world, without consulting us, and they’re beyond effective regulation. It’s not a question of ‘evil bankers’ – most of them don’t understand how the money system works or where money comes from either. It’s about a system that’s evolved, and has been gradually manipulated to concentrate wealth in ever-fewer hands, and that slowly destroys our ability to do anything about it.

Two men who have never stood for election, Hank Paulson and Ben Bernanke, were the architects of the bank bailouts in the US after the 2008 crash. It was the biggest transfer of wealth from ordinary people to elites in history. Every other Western country was told to follow suit.

The basic relationship is this: the state gives a monopoly licence to the banks to create money from nothing, as debt, with compound interest attached. Security is provided by the borrower, usually in the form of bricks and mortar, which is sometimes appropriated by the banks – especially when the economy crashes. The banks reciprocate by funding the state machine when they purchase government bonds (promises to pay in the future – a bond is an IOU, in other words). Banks have no restrictions on the amount of money they can create (and charge interest on), with nothing to back it. This is as true for the purchase of government bonds as it is for loans to businesses and individuals.

The future

The battle between the money men and everyone else continues. In their quest for power, the money men have defeated Roman emperors, the church, kings, US presidents and now, Islam (think Dubai). In other words, they have an awful lot of power. Financial institutions find ways around restrictions with more and more complex financial transactions, and the boom in the use of credit cards. The movement of money across national borders makes it even more difficult for a government or central bank to control money, and almost impossible for most people to even understand it.

There have been plenty of proposed solutions to curb this power – taking control of the money supply into the hands of the state in various ways (but the relationship between banks and state is so strong, this seems unlikely; and it would only put the same damaging game under slightly different management); crypto is certainly challenging banks, but is mainly about speculation rather than trade; mutual credit is certainly looking interesting too – no more scarce money, and control of the exchange medium brought into the hands of the public.

Economists tend to see themselves as concerned with the ‘real’ economy, and they see money as a mere means of exchange that concerns accountants, not them. And yet now money is a commodity in itself, and by far the most traded commodity in the world. So money is anything but a neutral medium of exchange (a surrogate for barter) – its main role in the current economy is to make more money. Private banks bring money into circulation, as debt, with compound interest attached to it, and they decide how much to lend and to whom, based on profitability, rather than what’s good for society.

We can do much better than this.

Contents

1. 15th – 19th centuries: early capitalism

2. The birth of bonds

3. Spain and Portugal lose out

4. The Great Settlement – foundation of the Bank of England

5. US presidents v the bankers

6. Hut taxes

7. 1800 to 2000

8. 1920s and 30s

9. 1940s, 50s and 60s

10. 1970s

11. 1980s and 90s

12. Coming soon:

Here’s part 2 of a very quick history of money, to counter claims that ‘money evolved from barter’, or ‘Kings introduced coins so that their subjects could trade more easily’. Money, our means of exchange within capitalism, is also used to store value, and so stored it is - billions are accumulated in the hands of very few, taking the exchange medium out of circulation and effectively destroying democracy in the process. In a commons world, we could do much better.

Part 1 (3000BCE to 1400).

Part 3 (the 21st century).

15th – 19th centuries: early capitalism

John Calvin was credited (or blamed) for the relaxation of usury laws, but whoever was responsible, the ban on usury was certainly ended, resulting in a boom for bankers.

The birth of bonds

In Italy, at the beginning of the 15th century, bonds were introduced by the cities to fund wars. Purchasing state bonds became compulsory for citizens, but interest was paid on them. Bonds were promises to pay in the future. Because of fractional reserve banking, banks were able to buy up most bonds with money they didn’t have. So governments issued bonds to get the resources of the citizens to fight wars, but governments actually ended up deeply in debt to the banks.

Spain and Portugal lose out

Spain and Portugal had carved up the entire world between themselves in the 16th century, and galleons were importing gold and silver from Latin America every year. But a century later, they were among the poorest countries in Europe. They spent their American plunder on palaces and luxury goods, instead of developing banks and industries. They transferred money to merchants in other parts of Europe, where wealth and power began to concentrate.

This bullion from the new world formed the springboard for capitalism and the industrial revolution, but Spain and Portugal didn’t benefit.

The gold that the Spanish stole from South America didn’t hang around in Spain for very long.

The Great Settlement – foundation of the Bank of England

There was a constant tussle between banks and the state for control of the money supply. In Britain, Henry VIII relaxed usury laws and moneychangers prospered. Catholic Mary re-tightened usury laws, moneylenders hoarded coins and the economy shrank. Elizabeth took on the moneylenders, and issued gold and silver coins from the public treasury. Cromwell was funded by moneylenders, and provided licences for them to operate legally. They were given a square mile in the City of London to ply their trade.

This battle was ended with the founding of the Bank of England (the Great Monetary Settlement). It was the result of a deal between the sovereign and bankers – but only after the Glorious Revolution of 1688 had given real power to parliament. The sovereign (state) endorsed bankers’ private money, and allowed it to circulate throughout the country as legal tender (that you can pay tax with). In return, state finances were put on a sounder footing, and the state had money to fight wars.

In 1688, William and Mary came to the English throne. William was in a war with France, and needed money desperately. Moneylenders generally refused (they’d been stung by royalty when the Stuarts had reneged on debts). Scot William Paterson came up with a plan – a loan of 1.2m from a consortium (largely Huguenot merchants, whose names were never released) who, in exchange, would be allowed to form a central bank. This happened in 1694. It provided money as debt to the king, and by 1708 it had virtual monopoly on issue of banknotes.

This was the start of a central bank / state system that survives today – the government can sell bonds to the central bank – so that they can spend without putting up taxes, and banks can lend money that they don’t have and charge interest on it. Debt started to grow uncontrollably. All countries now have central banks based on the Bank of England model.

US presidents v the bankers

There were several attempts to form a central bank in the US, and various US presidents were violently opposed to it – because they favoured democratic government over an unelected ‘money aristocracy’.

Alexander Hamilton wanted to establish a central bank in America modelled on the Bank of England. Jefferson trusted Hamilton and didn’t understand banking. Later, Jefferson, Franklin and Madison opposed it – it was a battle that raged until the Federal Reserve was eventually founded in 1913.

Andrew Jackson was the biggest opponent of central banking, and famously said ‘I killed the bank’. Bankers tried to crash the economy by restricting loans and blaming Jackson, but Jackson made successful alliances and the bank idea stayed dead. He survived an assassination attempt.

Lincoln applied for loans from bankers, who wanted to charge extremely high interest rates. He refused, and instead, got congress to authorise the printing of money by the government to fund the civil war. The notes were called ‘greenbacks’ because of the green ink on the back. These were printed without interest to the government (i.e. to taxpayers), to pay for troops’ wages and supplies. Lincoln wasn’t as lucky as Jackson, and was assassinated.

Hut taxes

When Europeans colonised Africa, they found it difficult to get Africans to work in their plantations, as most families had a smallholding to support themselves. Their solution was to introduce money into the African economy. ‘Hut taxes’ became payable – i.e. if you had a hut (which everyone did), then you had to pay a tax to the colonial authority. The taxes had to be paid in coins produced by the colonisers. When Africans asked how they were supposed to get these coins, they were told that they would have to work for them, in colonial plantations. If coins weren’t available locally, taxes could also be paid directly with work (Narissa Ramdhani, Financing Colonial Rule: The Hut Tax System, 1985).

In this way, money was introduced into parts of the world where it had never existed before. Whoever had the strongest army could issue money to organise a society to transfer wealth from ordinary people who created it, to themselves. It was a means of control, that still exists.

1800 to 2000

‘Money’ is not some given monolith that exists independently of world events – it’s constantly changing. 1971 was possibly as significant as 1694. Another momentous change is overdue. Let’s hope it’s a good one, that transfers power to communities and people, and away from the finance sector and the super-wealthy. Here are some of the big changes over the last 200 years.

In 1821, the UK introduced the first official ‘gold standard’, and other developed countries followed. It meant that all bank notes could be exchanged at a bank for gold. In other words, currencies are ‘backed’ by gold. This gave confidence in national currencies, but was discontinued when World War I saw combatant governments printing money like crazy to fund the war effort. The Federal Reserve (the US central bank, founded in 1913) was allowed to put $100 into circulation, backed by only $40 worth of gold, and between WWI and WWII, notes were only partially redeemable for gold. This was called a gold exchange standard, a type of fractional reserve banking that required banks to hold only a fraction of the value of the money they issued in reserve as gold.

Global currencies were at one time backed by, and redeemable for gold.

1920s and 30s

During the ‘Roaring Twenties’ – the Federal Reserve increased the money supply. Interest rates were low, and companies and individuals got into a large amount of debt.

The Great Depression: on ‘Black Thursday’ in August 1929, banks stopped lending and called in loans. People had to sell their stocks for any price to service their debts, but the big names (Morgan, Rockerfeller et al.) had taken their money out of the stock market and put it into cash or gold.

Wikipedia states that the Keynesians believed that the Great Depression was caused by people hoarding money, and refusing to consume or to invest, and that monetarists believe that it was caused by a contraction of the money supply. Both had an impact.

Wikipedia also says: ‘There is consensus that the Federal Reserve System should have cut short the process of monetary deflation and banking collapse’, and ‘By not lowering interest rates, by not increasing the monetary base and by not injecting liquidity into the banking system to prevent it from crumbling the Federal Reserve passively watched the transforming of a normal recession into the Great Depression.’ This sounds as if the banks are passive, and don’t understand the consequences of their actions – as if the ‘boom and bust’ business cycle doesn’t exist. If banks can make lending easy then tighten it up and foreclose on lots of businesses and homes, sell them, make more money and repeat – why wouldn’t they do it? Banks are able to make money scarce. The business cycle doesn’t just happen.

1940s, 50s and 60s

During WW2, European economies were turned over to war production, and farm and factory workers were sent to war. Consumer goods were bought from the US, mainly with gold. The US entered late, and by the end of the war, had two-thirds of the world’s gold. Europe had virtually no gold, but was later flooded with dollars lent by the US. The global economy couldn’t continue in the way it had, and so representatives of world governments met in Bretton Woods in the US in 1944 to devise a new system. From that meeting came the World Bank and the International Monetary Fund. All global currencies were backed by the dollar, which was backed by gold, at $35 per ounce. This brought stability, with all currencies pegged to the dollar, rather than floating around freely. World trade boomed. But no reserve ratio was established, so this was, in effect, zero reserve banking, or at least the freedom for banks to do that. Banks could create money freely and states could spend it freely.

In 1949, Diners Club cards – the first credit cards – were introduced, and since then, credit card debt has boomed (provided by all kinds of corporations, not just banks) to the point where it makes a mockery of any government or collective attempt to control the money supply.

In the 50s and 60s, the US embarked on a spending spree, culminating in the hugely expensive Vietnam War (carpet-bombing poor countries isn’t cheap). The world was flooded with dollars, and countries started to wonder how much gold there really was to back it. In the 1960s, France got suspicious, and started to redeem dollars for gold. Other countries did the same, and the US lost 50% of its gold during the 60s.

The Vietnam war proved so expensive for the US, that they were forced to end the backing of the dollar by gold.

1970s

By 1971, it was obvious that there were many times more dollars in the world than gold to back them. It was the classic goldsmith’s fraud (see part 1), that had to be made official to stave off global collapse. So President Nixon went on TV to take the US off the gold exchange standard, and all the world’s currencies became fiat – i.e. they were worth something because the government said they were, and nothing else. The world entered an age of fiat and floating exchange rates.

Since then, currencies haven’t been backed by anything, which has resulted in wild fluctuations, massive devaluations and currency speculation that’s parasitic, provides nothing useful, and thrives on instability. The more the value of currencies rise and fall, the more opportunity there is for profit from speculation. Also in the seventies, the US began the now-famous protection racket with oil-producing countries, and the petrodollar was born. Oil-producing countries were ‘persuaded’ to sell their oil only in dollars (as in, ‘nice oilfields you’ve got here. It would be a pity if anything happened to them’). This massively increased demand for dollars, as they were required to buy oil, which everyone needs. The US was able to print dollars freely and purchase the resources of the world, creeping ever-further into debt, whilst building the largest military force the world has ever seen – by a long, long way.

Structural adjustment: newly-independent ex-colonies were offered loans from Western banks, after years of rule by Western powers, and extraction of their resources. The interest on these loans ensured that they’d never be free of debt. When they’re unable to repay, the IMF imposes ‘structural adjustment policies’ that put control of their resources ultimately into the hands of Western banks.

1980s and 90s

There had been a ‘deal’ between capitalists and workers in the West since WW2. The deal from Western governments was: don’t become communists and we’ll give you healthcare, social security and education, plus council houses, and we’ll tie wages to productivity. But the deal changed in the 80s to: we’re going to wind back those benefits, but you can have as much credit as you like.

Banking regulations were removed, and credit went through the roof. Banks hugely extended their influence over the economy, and would be bailed out by the public if they failed. In the UK, Gordon Brown removed any last vestige of government control over the money supply when he made the Bank of England entirely independent in such matters.

Banks took advantage of gaps in the law to buy up mutually-owned savings institutions (savings & loan companies in the US, building societies in the UK). Only building societies with ‘asset lock’ clauses remain mutual in the UK.

Now banks don’t have to hold any percentage of the money they create on reserve at the central bank. There were liquidity reserve ratios, which are similar, but which allow banks to buy government bonds, and the government will just put the money received into another bank – and on it goes. There were no real limits on the amount of money banks could create. Liquidity ratios were themselves abolished in 1981. There are ‘capital adequacy reserves’ – the Basel Accords – to make sure banks have a buffer if lots of loans start to go bad. But this doesn’t limit them if the economy is doing well. The ONLY limit on the amount banks can create is their confidence that borrowers can repay. The Glass-Steagall act was repealed (which means that the investment and retail arms of banking are no longer kept separate).

What could possibly go wrong?

140 years in 10 minutes. His idea is to go back to gold, which is maybe not the best idea.

Coming soon:

Part 3: the 21st century

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Contents

1. Overview

2. Origins of money

3. Pre-700 BCE

4. Origin of money 1: ancient grain receipts

5. c. 700 BCE – c. 600 CE: The Axial Age

6. Origin of money 2: tax tokens

7. Rome vs the moneychangers

8. Jesus vs the moneychangers

9. 600 CE – 15th Century: the Middle Ages

10. Origin of money 3: bills of exchange

11. Origin of money 4: ‘common tender’

12. Bracteates – exchange but no store of value

13. Bills of exchange become transferable

14. Origin of money 5: goldsmiths’ receipts

15. Coming soon:

Here’s a very quick history of money, to counter claims that ‘money evolved from barter’, or ‘Kings introduced coins so that their subjects could trade more easily’. Money, our means of exchange within capitalism, is also used to store value, and so stored it is - billions are accumulated in the hands of very few, taking the exchange medium out of circulation and effectively destroying democracy in the process. In a commons world, we could do much better.

Part 2 (1400 to 2000)

Part 3 (the 21st century)

Keep in mind that we mustn’t think of ‘money’ in long-gone societies as being similar to ours. Their words for money may have meant very different things – maybe receipts or IOUs or even tax vouchers. In modern Europe, coins were introduced about 1000 years before banking, but in ancient Babylon, banking was introduced about 1000 years before coins. Both banking and coins disappeared and reappeared at various times and in different places. It’s impossible to generalise when it comes to the history of money.

Overview

We have to understand that most people throughout history never used money, as in notes or coins. Most ordinary people got the things they needed through a system of credit of some sort – either recorded officially, or just held in people’s heads. In a medieval inn, for example, everyone could get beer without paying anything, because the innkeepers needed lots of things from their customers – eggs, meat, dairy, fish, vegetables, fruit, cereals, blacksmithing, masonry, thatching, carpentry, furniture, clothes, baskets etc. – all of which were supplied by local people who wanted beer, as well as the things that other people produced. They didn’t have to bring these things to the pub though – it wasn’t barter; it was a kind of mutual credit in people’s heads. Everyone knew who was pulling their weight and who wasn’t. Most people didn’t stray far from home. This kind of mental (or recorded) tallying happened in most places, in most ages.

But in some places, in some time periods, people used (or were required to use) coins. Why? Well, possibly due to war. It’s unwise to offer credit to passing soldiers, and so in times of upheaval, war and empires, coins appeared. Rulers issued them to soldiers, who could buy anything they needed from the citizens, because the rulers decreed that citizens needed the coins to pay their taxes.

There seem to have been 4 great eras where either credit dominated (during times of relative peace and scattered kingdoms) or coinage / commodity money (corresponding to times of war and empire-building).

1. Pre-Axial age (before about 700 BCE): mainly scattered kingdoms, pre-coinage, money was credit.

2. Axial Age (c. 700 BCE – 600 CE) – an age of empire, conquest, war and coinage.

3. Middle Ages (c. 600 CE – 15th century) – a relatively peaceful period, scattered kingdoms, money was mainly credit; coins were scarce.

4. Modern Era: (15th century – present) – back to coinage / commodity money, conquest and war.

The earliest coin that we know of – from Lydia, in what is now Turkey, made from electrum, a naturally-occurring alloy of gold and silver. It’s over 2700 years old.

Origins of money

Let’s start with a theory that’s been discredited, but that can still be found in many economics textbooks. The story is that people were struggling to trade in a barter economy – they had to find someone who had what they wanted, and wanted what they had, which is difficult. They might have to cart sacks of potatoes around until they could find someone who wanted them. Someone came up with the idea of using something as a medium of exchange, like cattle, dried fish or salt – something that was useful in itself, so that you knew the value of it. This eventually changed to tokens that could be carried around more easily – like cowrie shells or precious metals. Then one day a wise king decided to mint coins, stamped with his head to ensure weight and purity, and give them to his grateful subjects as a medium of exchange that they could carry around easily, and that everyone would accept, so that trade could be facilitated in the realm. But this is not what happened. Throughout history, people have lived without money, in communities in which ‘everyone simply keeps track of who owes what to whom’ (Graeber, Debt, the First 5000 Years). And again, this wasn’t barter, due to the difficulty in finding a direct reciprocal trade. In fact, there’s never been a society in which the main means of exchange was barter, and money didn’t evolve from barter, but from mutual exchange within communities – where the vast majority of exchanges took place. Barter was always marginal and between strangers, and in fact the root of the word can be found in ways to cheat, deceive or to have sex with (and there are many other words for that!). That this is a theory still usually taught to economics undergraduates is scandalous.

Pre-700 BCE

Lots of ‘origin of money’ stories are lost in pre-history, and some sort of money was needed – for dowries, for religious ceremonies, ornaments to display status, protection money, fines for killing a member of a family etc. And the things used could be a whole range of different objects, depending on the culture. No-one is absolutely sure of the details of ancient monies.

Origin of money 1: ancient grain receipts

After the agricultural revolution and the development of the first cities, the ruling class didn’t develop by seizing the means of production, but by gaining a monopoly over the means of exchange and distribution. Farmers put their grain in collective granaries for safe storage, and got receipts for the amount of grain they’d delivered. As towns grew, so did the number of administrative, urban jobs, and a management class took over this central grain-based accounting system; and grain began to be lent in lean times. In the Sumerian empire, farmers deposited first grain, then other crops, tools and precious metals, in temples and palaces that had thick walls and guards to keep the deposits safe. They obtained receipts for their deposits on clay tablets, and these tablets could be used to collect their deposits if necessary, but they were also used to purchase things, clear debts and pay taxes. The earliest known examples of (cuneiform) writing were in fact accounts; and the earliest known bank was the House of Egibi in the city of Babylon, which operated in the first quarter of the first millennium BCE, although banking had existed since the third millennium BCE. They accepted deposits and provided loans and bank transfers, as well as foreign exchange (with the Assyrians, for example). Many banks existed in Sumer, and also in Egypt, where grain was the most important deposit. More here (great article).

The first Banks were popular because if you paid debts or taxes via the bank, you had an official record that couldn’t be denied.

The very earliest ‘coins’ appeared in China around 1200 BCE, although they weren’t coins as we know them. They were identically-cast tools like knives or adzes. China’s coins were always of base metal and therefore of low intrinsic value – unlike the high-value precious-metal coins that developed in the West. For this reason, banknotes appeared hundreds of years earlier in China, for high-value payments.

The first non-Chinese ‘pre-coins’ (ingots) appeared in Asia Minor before 2000 BCE. The ingots got smaller, got stamped, got rounder etc. until coins proper appeared in Lydia and Ionia (still in Asia Minor) in the 7th century BCE, during the reigns of two kings famous for their wealth – Midas (as in ‘Midas touch’) and Croesus (as in ‘rich as’ Croesus) – although both were possibly mythical.

c. 700 BCE – c. 600 CE: The Axial Age

Origin of money 2: tax tokens

Citizens of ancient empires and city-states paid taxes with grain or other produce, or labour; but at some point in Greek Asia Minor around the 8th century BCE, coins appeared, and by the time of Periclean Athens in the 5th century BCE, rulers were minting coins for their subjects to earn so that they could pay taxes with them. The coins were used to pay soldiers, who used them to obtain food, clothes, accommodation, booze, sex and weaponry, and locals queued to give them those things, to get the coins they needed to pay their taxes. Previously, soldiers had to scour the areas around their camps to requisition food and provisions, but now local people willingly came to them. It was much easier – the ruler could also pay farmers, masons, blacksmiths and carpenters to provide food for the court, horses, castles, weapons and ships, and the soldiers were used to enforce payment of taxes. Once this system was in place, it was easier for rulers to accumulate wealth and build their empires. Where a particular ruler’s coins circulated outlined the limits of that ruler’s realm, and ‘legal tender’ appeared for the first time.

David Graeber on one origin of money – to pay taxes (from 15.20)

Dominant nations or cities (like Athens) extended their power by spreading the use of their coinage, and by doing so, they spread the money system too. And on it went. Money-military-slavery complexes (from Graeber) developed (Alexander’s empire, Rome, various Indian empires, China during the Warring States period), which worked like this:

• Conquest – slaves captured;

• Slaves put to work in silver mines;

• Coins made from the silver;

• Soldiers paid with the coins (as well as shipbuilders, weapon-makers etc.);

• Conquered people ordered to pay taxes in the coins;

• People provisioned soldiers for coins;

• Armies were fed well, and conquered more lands.

Alexander captured local mints, that were then used to mint more coins for him to continue his campaign, often from melted down treasures in those cities. Similar things happened during the European colonisation of the world in the 19th and early 20th centuries – see ‘hut taxes’, below.

Often, the value of coins wasn’t stamped on them – their value was announced by ordinances. In that way, the ruler could devalue the currency, pay people high-value coins, then devalue, so that people then need more of them to pay their taxes. It was the equivalent of an additional tax. This suited the sovereign, but not the subjects.

So it was via the goods and services that rulers were able to claim from people who needed their coins to pay taxes that allowed tyrants to build their empires (and to feed soldiers, who were also their hit men to ensure that the plebs paid their taxes).

Whoever controlled the issuance of money was able to organise society to transfer wealth from ordinary people who created the wealth, to themselves. (Does that sound familiar?)

Athens was the first fully-monetised state. Coinage spread rapidly around the Mediterranean, and through Mesopotamia and Persia to India.

In Sparta, coins were iron discs, made brittle by dipping in vinegar (so they weren’t even valuable as iron). Spartan rulers deliberately avoided making the coins from precious metal, so that the coins had value just because the ruler said so. Gold and silver were only used for trade outside the boundaries of the kingdom – where their fiat didn’t work. Internal fiat money couldn’t be stolen in war, couldn’t leak out of the country for luxury goods from abroad, and as much could be produced as the ruler wanted. Also, if a state’s money was a useful commodity (precious metal) – the state would be on a constant quest for precious metal – a waste of energy and resources.

Rome vs the moneychangers

Rome’s money was stamped on thin copper (they didn’t have paper), but the value of the coins was much more than the copper itself. So the ascent of Rome was based on fiat money (money that’s only valuable because an authority says it is). Later, they conquered lands and stole gold and silver, which was used to produce coins (around 200 BCE). But this involved a lot of work to get, and could be stolen. It ended Rome’s financial independence.

Moneychangers became very powerful via usury (lending at interest). In the second and third centuries BCE, two emperors tried to restrict usury and were assassinated.

Julius Caesar brought control of the money system back to the state, in order to build large public works. He was assassinated too.

Roman coin of stamped copper, first century CE.

Jesus vs the moneychangers

Jews needed silver shekels to pay taxes. Moneychangers cornered the market and raised the price of money to what the market would bear. They did their transactions in the temple, which was considered profane. Jesus used violence for the only time during his ministry (whether the story is true or not is irrelevant – it has passed down to highlight the profanity of the banking industry) to throw the moneychangers out of the temple.

Jesus was killed too of course. There was a bit of a pattern developing, that would be repeated many times.

The Christian church prohibited usury, but in the end, was defeated by the money-men. Jesus may have won the battle with the moneylenders in the temple, but the church lost the war.

600 CE – 15th Century: the Middle Ages

After the fall of the Roman Empire, coinage began to disappear. But throughout the Middle Ages, there were various developments that set the scene for the birth of capitalism and the monetisation of everything, after the Renaissance.

Origin of money 3: bills of exchange

The Hawala system was born in India in the 8th century and was used to transfer payments between south and east Asia and the Middle East for goods that were moved along the Silk Road. It’s a system that continues to this day, and works like this: Hawala agents are trusted business people who may run shops or other local businesses. Someone wishing to transfer an amount of money to another country deposits the cash with their local Hawala agent, along with the town the remittance is to be sent to, the name of the person who will collect it, and a password. The password is sent to the receiver, who walks into their local Hawala office, gives the password and receives the cash. No bank account required. The agents charge a fee, and if the amounts they send and receive get too far out of kilter, then accounts can be settled with payments of some description between the agents – not necessarily money. It’s all based on trust, and works because the agents don’t want to damage their business reputations in their communities.

The Knights Templar had opened up trading and pilgrimage networks around Europe and into the Middle East (Charles Greenstreet Addison and Robert Macoy, The Knights Templar History, 1978), where they may well have learnt about the practice of Hawala. They developed extensive banking and financial services, so that European merchants could deposit coins, gold or valuables at one branch and withdraw them at another, in another country, by presenting a document that was in effect, a travellers’ cheque. This removed the risk for merchants of carrying valuables around the continent, and the cheques were of no use to bandits. The Knights Templar facilitated a boom in international trade, but after they were disbanded in 1312, merchants found it difficult to purchase goods abroad. Early banks stepped in by providing ‘bills of exchange’ – up-front payments for foreign goods. These bills were carried around Europe on horseback, and were accepted by sellers everywhere. When the merchants sold the goods, they repaid the banks, plus a fee, usually around 10%. They were careful not to call this a loan, as usury was illegal – it was just a money transfer for a specific purchase, with a fee attached, not interest. The bills of exchange started to be passed around as money, and the banks started issuing them for domestic transactions, not just foreign trade. There was no limit on the number of bills they could issue, and there was nothing to back them. After the Knights Templar were disbanded, they went underground to continue their activities – probably in Switzerland, which is (possibly) why it emerged as a banking centre.

Origin of money 4: ‘common tender’

We’ve mentioned the fact that most transactions for most common people throughout history was in the form of reciprocal favours – a type of mutual credit recorded in people’s heads. There were also local currencies that passed between traders on market days – people who knew each other but didn’t necessarily live in the same village. Local currencies could be issued as IOUs, by people who were known and trusted – and their produce was good. This included farmers, bakers, brewers and craftspeople. Coinage was used in the Middle Ages mostly by royalty and nobles, for luxury goods, and for waging wars. ‘Common tender’ that included mutual credit, IOUs and local currencies were used by ordinary people who rarely, or maybe never, saw or used coins. This meant that if there was an economic crash that made coinage scarce, ordinary people didn’t suffer in the way they do now (because they’re reliant on official currency). Ordinary people could issue ‘money’ whenever they needed it.

Paul Grignon’s take on common tender – medieval market money.

Bracteates – exchange but no store of value

In the early Middle Ages in the Holy Roman Empire, thin metal tokens called bracteates were made and distributed locally by princes and monasteries to serve as media of exchange. They had no intrinsic value, and were recalled regularly, often annually, with a small deduction – enough to dissuade people from holding on to them, and persuade them to spend them into the local economy instead.

Bills of exchange become transferable

Italian banking families like the Bardi and Peruzzi – in Lombardy (hence Lombard Street in the City of London) in the 13th and 14th century became very rich. But how, without usury? It was via bills of exchange (which were a bit like cheques). Merchants could deposit money in an Italian branch of a bank, then take a bill of exchange with them to pay for goods abroad. It would be no good to thieves, as it was payable only to the holder, like a cheque. The banks would charge a 10% fee for this – no usury. Or – merchants could promise to pay a certain amount after a trade was done, and ‘borrow’ money – via a bill of exchange – to do it. When the trade was done, they would pay back the cost of the bill of exchange, plus an agreed fee (usually around 10%). The supplier was happy to take the bill of exchange because he knew he could cash it at the bank.

Lots of bills of exchange started to be written, that weren’t backed by anything, and so they were produced in huge quantities. Later, the law was changed to allow them to be transferable, and so they circulated through the economy as money, at least for bigger purchases. Bankers became incredibly wealthy – wealthier than royalty. They behaved a bit like Mafia families, with intrigue, corruption and assassinations. They didn’t actually need interest to become so wealthy, as long as they had money-issuing powers and monopolies.

The Medicis were one of these banking families, who became bankers to popes and royalty, took charge of Florence and sponsored some of the great architects and artists of the Renaissance, like Michelangelo and Leonardo da Vinci. They were merely promoting their ‘brand’.

Origin of money 5: goldsmiths’ receipts

In medieval Europe, goldsmiths built strongrooms to keep their gold safe. They would store other people’s valuables in their strongrooms too, for a fee. They began to issue receipts for valuables stored, that could be used as money, so that when nobles wanted to buy property, for example, they didn’t have to carry gold and jewellery around a country infested with bandits. They could use the receipts as a way to buy things, because the seller knew that the goldsmiths were storing goods to the value of the receipt, and that the receipt was a claim on those real goods.

The goldsmiths started to lend these receipts, and charge interest. They circulated as money, and the goldsmiths started to get wealthier. Then, when they realised that people very rarely collected their valuables, they could risk lending more money than was backed by treasure in their vaults. And they did – many times more, until their lending became much more profitable than their goldsmithing. They became the first modern bankers – the beating heart of a system that was required to generate the funds for the campaigns and the palaces of royal and aristocratic families all over Europe, and later, the enterprises of the capitalists who took over the economy.

These early bankers became wealthier than monarchs. In fact, Jakob Fugger, a German banker born in 1459, is considered (adjusting for inflation) to be the wealthiest person who ever lived (Greg Steinmetz, The Richest Man Who Ever Lived: The Life and Times of Jacob Fugger, 2016). The bankers’ trick of lending non-existent money had to be enshrined in law, because it came to represent the foundation of European economies. It was called fractional reserve banking – the banks only had to keep a fraction (usually around a tenth) of the amount they lent out, in reserve in their vaults.

Coming soon:

Part 2: 1400-2000

Part 3: the 21st century

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