This article focuses on the systems thinking behind the economic transformation I am advocating.
The idea that we need to transform the economic system in order to avoid environmental catastrophe is growing in popularity. The degrowth movement is currently the most prominent movement for post-capitalist economics, and it is true that getting past the imperative for economic growth is an important element of the needed economic transformation. But rather than simply going against the current hegemony of economic growth, we must create a holistic new system with which to supersede today’s capitalist system.
To do this, we must find replacements for each of the major components of the economic system. A core component of capitalism for which we need a replacement is the development dynamic of capital accumulation for profit. This dynamic drives development in the capitalist system, and to create a viable new system, we need a new dynamic that is an equally powerful driver of development, but sets that development on a better trajectory. Such a development dynamic does exist, and it is called cosmolocalism. This article describes how cosmolocalism can replace capitalism.
How capital accumulation drives development
An idea at the heart of capitalism is that owners of capital should aim to increase the capital they personally own and the profit they make from it. They do this by making goods people want to buy and then reinvesting the profits to increase their capital, in order to make more profits. As many capitalists are trying to do this, they compete and each must improve to beat the others. This competitive accumulation drives capitalists to innovate the provision of goods and services and to continually seek to build more capital. Thus capital accumulation for profit creates a dynamic that drives development.
This has been a fundamental driver of development in recent generations, and it has greatly improved quality of life for many people. But it has also resulted in negative environmental impacts that are now severe and, if we do not change direction, will soon become catastrophic. To avoid catastrophe, we need a new dynamic that allows us to improve both our environmental impact and our overall quality of life.
Cosmolocalism is the new dynamic we need
Cosmolocalism is a dynamic that can help us redirect our development. The idea of cosmolocalism can be summed up in the phrase ‘design global, manufacture local’ (or DGML). A cosmolocal organisation is a global network that connects local nodes, such as factories, so they can share their developments through the network. Each local factory acts independently within its own region, but when it does something new, such as inventing a new product, it tells the rest of the network about it, for example by uploading the designs of the product onto a database. All the factories in the network can immediately access the information about the innovation and decide whether to begin manufacturing that product themselves. If someone in another factory makes an improvement to the product, this is also uploaded onto the cloud so the rest of the network – including the original inventors of the product – can see the improvement and apply it themselves.
This sets up a collaborative dynamic in which the accumulated knowledge and experience of everyone in the network is available to everyone else. As the network grows, so does the number of people adding their own experiences to the pool of knowledge. In a fully developed cosmolocal system, everyone can add to, and learn from, a global information commons that represents the accumulated technical knowledge of humanity.
Fab Labs – a cosmolocal example
The ideas of cosmolocalism were pioneered by Wolfgang Sachs and current thought-leaders include Jose Ramos and Michel Bauwens. There are already many cosmolocal networks in existence.
A particularly good example is Fab Labs, which is a network of makerspaces that was begun in 2002 by MIT’s Center for Bits and Atoms (CBA) and has spread globally – there are now thousands of Fab Labs around the world, from Bolivia to Bhutan. While Fab Labs is a network of makerspaces, the organisational structures it uses can be adapted and applied to networks of factories, and similar cosmolocal ideas can be applied to many other areas, including regenerative agriculture.
The first Fab Labs were set up by CBA, but once they decided to turn it into a network, they set up a separate non-profit organisation, the Fab Foundation, to guide the development of the network. The Fab Foundation does not decide where Fab Labs should be built, and it does not fund them nor own them. Anyone is allowed to build a Fab Lab and join the network, so long as they abide by the Fab Lab ethos and rules. The Fab Foundation’s role is to support the network, by facilitating collaboration between labs, encouraging members of the network to develop new initiatives that can spread through the network, and supporting network-wide initiatives as they grow.
The designs for everything built in a Fab Lab are uploaded onto the Fab Cloud, where they can be accessed by every Fab Lab. As well as this, the equipment used in Fab Labs is shared across the network, and visible to people outside the network, who might be considering building one themselves. There is an ideal Fab Lab set-up on the Foundation website, but it isn’t necessary for each lab to have exactly these tools. Instead, each lab should have similar capabilities – anything you make in one Fab Lab, you should be able to make in every other.
For factories, this part of the system should be similar but not identical: it is important that information about equipment is made available to everyone in the network, with high-quality equipment and the capabilities of networked factories easy to find. But rather than every factory having the same capabilities, they should each be allowed to use equipment that gives them the capabilities they want to have. For example, different types of clothing are useful in different parts of the world. A network of clothing factories should facilitate each local factory to produce the clothes needed in their area. They needn’t be able to produce clothes only used elsewhere; but if clothes from another part of the world are wanted in their area, it should be easy for them to begin making them locally, rather than importing them from afar.
Another important element of the Fab Labs network is the Fab Charter. This is a document that sets out, in easily-understood terms, the basis of the network, such as what it is there for, what a Fab Lab is, and what rules Fab Labs must abide by. Charters will also be important for factory networks, although the details will be different. For example, the Fab Charter says member labs must be open to the public and can be used to prototype, but not produce, commercial products. A factory Charter, on the other hand, might say member factories should only supply products to their local area, and should use democratic decision-making, for example.
An important detail of this system is the licensing that determines how cosmolocal information commons can be used. In recent years there has been a strong movement for open-source information, in which anyone can use the information for any purpose. However, there is a problem with this for cosmolocal databases.
The problem is that when information is fully open-sourced, it allows profit-maximising corporations to access the entire knowledge bank of the networks, but then patent the innovations they build on top of it. This gives capitalist corporations an advantage over cosmolocal networks, and makes it much harder for cosmolocalism to challenge capitalism as the dominant driver of development.
A better model is to use a licence more akin to a creative commons licence, which allows people to use the licenced work only if they abide by certain rules. Some creative commons licences include a ‘ShareAlike’ restriction. This allows people to ‘remix, adapt and build upon’ the licenced work, so long as they license their new creations under identical terms. There is a ShareAlike licence that allows commercial use and another that doesn’t.
A cosmolocal commons licence would include a ShareAlike restriction and would allow the work to be used commercially only by chartered cosmolocal organisations. This would both stop profit-maximising businesses taking advantage of the commons, and it would incentivise local businesses to become chartered and join the cosmolocal networks, so they can use the knowledge commons. This creates a positive feedback mechanism – as the cosmolocal knowledge bank grows, more businesses join the network, and with their contributions the knowledge bank grows even more.
The global knowledge databases that members of a network contribute to and learn from is the ‘design global’ part of the cosmolocal slogan; the other part is ‘manufacture local’. The idea behind this is that, while it is now easy to send information around the world via the internet, it is more environmentally damaging to send goods around the world. So it is better to manufacture things locally and minimise the amount of material goods that need to be moved long distances.
Reducing reliance on complex global supply chains also greatly increases resilience, as it decreases the impact of supply chain problems. This will be particularly important as climate change intensifies and the likelihood of serious problems in global supply chains increases.
However, not every region has access to all the raw materials they need. For example, cotton can only be grown in certain climates, so in the current system, the rest of the world is reliant on imported cotton for their clothing. This problem can be solved by developing regional circularity.
The circular economy is a way of organising material flows through the economy so that wastes from one process can always be used as raw materials for another. In a truly circular economy, materials cycle endlessly around the economy and never need to be thrown away. This simultaneously eliminates the waste problem and vastly decreases the amount of virgin raw materials needed, because all waste can itself be treated as a raw material.
In a regionally circular economy, the material cycles are confined to local economies, so that each region is circular independently of other regions. This not only greatly decreases total environmental impact, it also creates a new dynamic of regional self-sufficiency.
To use the example of cotton clothing… Once the clothing factory is built and the materials cycle is filled – meaning that there is cotton in the factory, clothing in the shops, everyone has a complete wardrobe and each of the links in the cycle is full – the region can become self-sufficient in terms of cotton clothing. There will be an ongoing need for energy and labour to keep the system running, but these can be provided locally. So long as the factory itself is kept in working condition and the cotton continues to cycle around the economy, inputs of capital and cotton will be minimal. They are unlikely to be zero, because the factory will need refurbishment and there will be some leakage of cotton. But the overall dynamic of the system will be one of approximate self-sufficiency.
Regional self-sufficiency can be taken even further by following another example Fab Labs is setting. They are developing a network of Super Fab Labs, which have machinery with which Fab Labs can themselves be built. So far, there are only two, one in Kerala & one in Bhutan, but the aim is to have regional Super Fab Labs that produce the labs needed for their regions. If this is applied to the production not only of factories but also of the infrastructure underlying the information commons, we will create truly resilient local economies.
A globally-inclusive model
This dynamic of self-sufficiency opens up an inspiring possibility: the model can be applied worldwide, potentially eliminating much of global poverty. Even in an area that is currently extremely poor, if a factory is set up, the initial raw materials supplied, and the people taught how to run the system, the area could become part of the cosmolocal network. It could then quickly catch up to the level of development embodied in the globally shared knowledge database.
Poor regions have different needs to those in the developed world, but such variety is incorporated into this model. Each area can adapt the equipment and its use to their own situation. They can also share their experiences with others in similar situations, so as to collectively discover the best ways forward.
Fab Labs sets a good example of global inclusivity. In setting up the network, its founder, Professor Gershenfeld, wanted to give remote communities access to tools with which to tackle their own problems. The first Fab Labs were set up by the network itself, and they included labs in rural India, northern Norway, and Ghana. There are now Fab Labs in 120 countries, and the first Super Fab Labs are in Kerala and Bhutan. This demonstrates that the spirit of global inclusivity has not been lost.
Capital and ownership
To create a cosmolocal economic system and supersede today’s capitalist system, we must change our relationship to capital.
At the moment, when someone funds the building of a factory, they generally expect to earn back more than they originally invested. This money is obtained by the factory selling its products into the global market, with the community the factory is in only benefitting from the wages of the workers.
But in the cosmolocal model, the products are produced for, and sold into, the area where the factory is located. So if the provider of capital expects to receive more money than they put in, they are extracting it directly from the community using the factory. Most capital is currently owned by wealthy people living in wealthy areas. So if we applied this model to cosmolocal networks, it would exacerbate inequality by transferring money from poorer to richer regions.
However, in a cosmolocal system, factories exist to serve their local area—so local communities should have decision-making power over their factories. Capital is currently held privately and there is a strong concentration of wealth. So we will need mechanisms to allocate capital fairly, curtail extraction, and institute democratic decision-making processes.
Such mechanisms do exist:
- Exit to Community is a strategy by which companies can put their assets into community ownership.
- The Future Guardian model is a governance structure for businesses. In this structure, providing a return to investors and contributing to the local community are equally important, as are the business’ effects on various other stakeholders.
- And Bendigo’s Community Banking model shows how a network can partner with local communities to build capital assets without being extractive.
While each of these mechanisms were created for different situations, they can all be applied to cosmolocal networks, particularly in combination with network charters.
There are also deeper changes that will be part of the transition to cosmolocalism. Capitalism has its own set of values (such as wealth being both the yardstick of success and the reward for it). Cosmolocalism will also imply a new value system.
One value that naturally seems to arise is the idea that our cumulative knowledge is an inheritance of humanity and should be kept in the public domain and made easily accessible. Another is a ‘live and help live’ ethos in which the exploitation of others is unacceptable. Everyone should be allowed to live as they please and given the tools and knowledge to be able to do so.
Looking further to the future, the metaverse might be an ideal place to expand our abilities to collectively invent and imagine. It could even become as fundamental to our technical development as the internet has become to our information and communication. As such, it is essential that the cosmolocal metaverse is not owned, but held in common by and for humanity as a whole.
There are many other aspects of a cosmolocal economic system that need to be developed. We will need ways for currently corporate organisations to become cosmolocal. We’ll also need safeguards against profit-maximisers hijacking the cosmolocal project. There should be mechanisms to give preferential treatment to cosmolocal organisations through supply chains and across networks. And the monetary and financial systems must be changed as part of the overall systemic transformation.
Fortunately, dedicated pioneers are developing the innovations we need. My new book, Building Tomorrow: Averting Environmental Crisis With a New Economic System, brings those innovations together to show how we can transform today’s capitalist system into tomorrow’s cosmolocalist one. The Cosmolocal Reader, edited by Jose Ramos and others, gives a comprehensive picture of the current state of cosmolocalism.
We need a new economic system with which to replace today’s capitalist system, or we will be unable to avoid environmental catastrophe. But the reality is, we are still a long way from creating the necessary economic transformation. The key to doing so is changing the development dynamic from competitive and profit-driven capital accumulation to regionally circular cosmolocal collaboration. If we do this, it won’t be long before we can not just imagine, but actually experience, the end of capitalism and the beginning of a new era.
Originally published on The Alternative, for which the link is here.