Life-Value vs Money-Value: Capitalism’s Fatal Category Mistake | Prof Jeff Noonan

The 2008 financial crisis spread from Wall Street to the world almost overnight, threatening the lives and livelihoods of millions, even though its causes had nothing to do with the production and distribution of any of the basic necessities of life. Instead, the crisis erupted because the financial system had become unhinged from its real function: supplying credit to productive enterprises. Finance capital increasingly made its money from complex “derivatives,” which are not claims on a company’s profit (as shares are) but on debts packaged and sold as investments. Immense profits were made, which provided the incentive to create more derivatives, causing debts to be piled on debts, all sold with guaranteed returns. Many of these derivatives involved American mortgages. Since these were backed by a physical asset (the house), they were advertised to institutional investors as highly secure, but the models assumed that housing prices would continue to rise. As it turned out, the housing market was a bad-mortgage fuelled bubble. When it burst, the “mortgage backed securities” became worthless, and banks from Athens to Iceland collapsed. Instead of having to foot the bill for their recklessness and greed, major banks were bailed out with hundreds of billions of dollars of public money. Workers lost their jobs, housings, and savings; Wall Street bankers paid themselves bonuses for the greatest failure of the financial system since 1929.

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The sharing economy: an alternative to capitalist exploitation? by Jeff Noonan

Political consciousness of systemic social problems produces opposite responses in groups differently situated in a social hierarchy. From the standpoint of exploited and oppressed groups, the recognition that they are determined by systemic socio-economic and political forces manifests itself as (more or less developed) demands for a different social system. From the standpoint of the ruling class and its ideological supporters, recognition of the same systemic problems (or, perhaps more accurately, recognition that systemic problems have become so widely obvious that they can no longer be plausibly denied) manifests itself as creative attempts to creatively name novel elements of the unchanged system in ways that make the change sound systematically transformative. Occasionally, these opposite strategies cross one another, as when the name of what system opponents take to be an alternative and the creative naming practiced by those trying to save the existing system are the same. I propose to examine the phenomenon known as the “sharing economy” with these considerations in mind. To avoid damaging political confusion, the referent(s) of the name must be carefully examined to see a) whether system opponents and system-supporters mean the same thing by the term, and b) whether the name really does refer to an alternative social system, and, if so, whether it is likely to solve the problems its supporters believe it will.

The answer to the first question is ambiguous. There is much overlap, but not identity, in what system opponents and system supporters refer to by the term “sharing economy.” The overlap centres on the technological platforms of social media and peer-to-peer networks which open up new possibilities for identifying common interests and linking people with goods or skills to exchange. The difference concerns the extent to which these possibilities can be realised within capitalism or constitute the rudiments of an alternative to it. Thus, system opponents and system supporters do and do not mean the same thing by the sharing economy, but both are convinced that the technologies involved are crucial to its nature. The second question is not as difficult to answer, but, as we will see, there is still some ambiguity. Even in the best sense of the term, I will argue, the sharing economy cannot solve the systemic problems typical of capitalism. While “to share” is a verb widely assumed to name a universally valuable moral disposition, a more careful analysis reveals that sharing is not always completely good. Even if it were always good, I will further argue, it is not the best moral foundation for the institutional structure of a democratic life-economy alternative to capitalism. While sharing and the technologies that allow it to occur beyond the spatial and temporal confines of local communities can be an important element within a democratic life-economy, there is no technological fix to the problems of global capitalism, and solution to the problem of exploitation, oppression and alienation demand an end to the structure of material dependence of life on commodity markets that sharing on its own cannot guarantee.

I will develop this argument in three steps. In the first, I will attempt to bring some clarity to the idea of “sharing economy,” highlight what system opponents and supporters see in it, and uncover the hidden moral ambiguity at the heart of sharing as a social practice. In the second, I will focus on the way in which ‘sharing economy” is understood by capitalist system supporters, exposing the ideological function of “sharing” in this use and the capitalist truth behind the ideology. In the third I will return to the problem of sharing as the moral foundation of an alternative economy, and argue that alone it cannot satisfy the key conditions an alternative would have to satisfy to prove itself morally and economically superior to capitalism. Instead, the moral foundation of a democratic life-economy is universal need-satisfaction and its institutional infrastructure is not peer-to-peer networks but democratically governed public institutions that ensure universal provision of natural and social life-requirements to each and all.

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