openEconomy

"Unsourcing" - does free labour ultimately require free goods too?

Crowdsourcing has been discovered by the corporate sector, The Economist tells us, as a great way to turn consumers into free labour. "Unsourcing", is the McKinsey-speak for the method pioneered by Wikipedia (and adopted by openDemocracy). But what are the system-wide implications of this move? Where will income to buy products come from once products are made by free labour? A bandwagon too far for the management consultants? Or the opportunity to think about the transformative politics necessary to sustain that world?

Aaron Bastani
5 July 2012

A recent ‘Babbage’ column in The Economist writes about the phenomenon of ‘unsourcing’.

“Some of the biggest brands in software, consumer electronics and telecoms have now found a workforce offering expert advice at a fraction of the price of even the cheapest developing nation...it is their customers themselves...."Unsourcing" as the new trend has been dubbed, involves companies setting up online communities to enable peer-to-peer support among users. Instead of speaking with a faceless person thousands of miles away, customers' problems are answered by individuals in the same country who have bought and used the same products. This happens either on the company's own website or on social networks like Facebook and Twitter, and the helpers are generally not paid anything for their efforts. As might be imagined, the savings can be considerable. Gartner, the research company, estimates that using communities to solve support issues can reduce costs by up to 50%.”

Here then is a specific claim that ‘crowdsourcing’, a form of commons-based production that has permitted content such as Wikipedia and platforms such as Mozilla to internet users for ‘free’, simultaneously permits corporations to reduce labour costs (variable capital) therefore boosting profits by essentially laying off paid workers.

Clarifying the janus-faced nature of networked forms of collective action within post-Fordism is essential for those who wish to understand its possibilities for positive change. While such networks undoubtedly present unprecedented opportunities in non-market, non-state based forms of ‘peer production, so long as they are embedded within the existing social system, those networked forms, such as ‘crowdsourcing’, can also intensify existing negative trends such as labour precarity and unemployment.

On the employment of crowdsourcing in the interests of profit, Christian Marazzi writes,

“(post-Fordism extends) the processes of value extraction to the sphere of reproduction and distribution...evermore explicitly, in both economic theory and managerial strategies, the externalization of production processes is spoken of... “crowdsourcing”. These crowdsourcing strategies, leaching vital resources from the multitude (commons-based forms of production) represent the new organic composition of capital, the relationship between constant capital dispersed throughout society and variable capital as the whole of sociality, emotions, desires, relational capacities (as well as plain technical knowledge and ability) and a lot of “free labor”.

He adds,

“...the increase in profits over the last 30 years...(heralds) a new type of accumulation...external to traditional productive processes. This new constant capital, unlike the (physical) machine system of Fordism, is constituted by a totality of organizational disciplinary systems that suck surplus labor by following citizen-workers through every moment in their lives, resulting in a lengthened and densified workday (the time of living labor).”

‘Unsourcing’ essentially means that one engages in production within both work and leisure. The fellow prosumer assists me with technical assistance as opposed to the paid ‘worker’. In a sense the indifference curve of labour/ leisure is completely dissolved. This coheres with what Paolo Virno writes in ‘Grammar of Multitude’,

“ It could be said (within Post-Fordism) that unemployment is non-remunerated labor and labor, in turn, is remunerated unemployment. Working endlessly can be justified with good reasons, and working less and less frequently can be equally justified. These paradoxical formulas, contradicting each other, when put together demonstrate how social time has come unhinged. The old distinction between “labor” and “non-labour” ends up in the distinction between remunerated life and non-remunerated life. The border between these two lives is arbitrary, changeable, subject to political decision making.”

‘Unsourcing’ is a perfect example of this logic as it is deployed to help (re)catalyse profits for companies as they come up against limits of growth after the end of easy credit, declining demand and the global financial crisis of 2008.  It helps to reduce costs of labour and wages (variable capital) through instrumentalising the process of ‘crowdsourcing’ to undertake what were previously services that the company had to pay workers to undertake. This is a classic example of ‘the commons’ being enclosed in order to catalyse profits and cipher it for a dispossessing minority.

This time, instead of enclosing common land as was previously the case with ‘IRL’ enclosure one sees the instrumentalising enclosure of the distributed, peer-to-peer network, which having created free and commons-based goods sees such goods hijacked for the private gains of a small group. Tiziana Terranova, among others, alludes to this same phenomenon throughout the ‘enclosed’ netspace of Net 2.0, particularly social network sites such as Facebook which simaltaneously present themselves as both playground and factory.  

Accelerating the Crisis

While ‘unsourcing’ means that companies save money by reducing labour costs, thus consequently revivifying or expanding profit margins, in the long term such thinking is counter-productive for the continued health of capitalist economies. This being because ‘unsourcing’ contributes to the decline of renumerated wage-labour, a trend observable in late capitalism.

But why is this problematic for market-based economies?

A central paradox for uninhibited capitalism is that it wishes to reduce the costs of labour within the production process as much as is possible (ideally to nothing). At the same time however it requires a sufficiently large market in order to buy the ever increasingly large number of goods and services in circulation. Subsequently, while the creation of a surplus labour army (or in modern terms, precariat) as well as ever-increasing automation within the production process is excellent in reducing the costs of labour - the increased inability of this ever larger group to reinsert itself back into the production process, earn a wage and thus purchase goods and services leads to a crisis of demand and perpetual under-consumption.

‘Unsourcing’ as unpaid, P2P mediated work that replaces previously renumerated work only intensifies such a phenomenon and contributes to the ‘secular crisis’ which possibly carries terminal ramifications for capitalism as an economic system.

Conclusion

Robert Schiller recently claimed that any stimulus package shouldn’t have a short-term increase in economic GDP as it’s primary objective but should instead focus on the creation of ‘jobs’ directly in sectors of high intensity labour like education, social care, the arts and scientific research. Of particular interest was his idea to renumerate those activities that for the most part are already performed but that are currently unwaged (Virno’s and Marazzi’s post-Fordist ‘Free Labour’ as well as care work and so on) or activities whose positive externalities, in particular to the environment, aren’t immediately translated into GDP growth in any classic cost-benefit analysis.

One would imagine that within such a framework Schiller would argue that those workers who engage in non-renumerated labour as a consequence of ‘unsourcing’ should instead be paid for their work. The renumeration of such work might even take the form of a guaranteed minimum income. Indeed it may only be through measures such as the GMI that the issue of the secular crisis can be resolved while upholding a market-based economic system. This is certainly not something not touched upon in the ‘Babbage’ article and is anathema to other obsequious accounts of the coming ‘third industrial revolution’ that can be found elsewhere.

One imagines Robert Schiller to be a better student of capitalism than the writers of the ‘Babbage’ column whose technological utopianism is conjoined with the now desiccated thinking of neo-liberal ideology. There are serious ramifications for the changes proposed by ‘unsourcing’ as well as other phenomenon within late capitalism that will increasingly minimise people’s ability to engage in waged labour and thus reproduce their lives under the existing economic system. While profits may be expanded by these paths social fracture and antagonism may well become increasingly amplified as a consequence. While it is true that Wired magazine and the ‘Californian Ideologues’ of a decade and a half ago had an uncritical position on technological change that bordered on utopian - the increased pervasion of a similar strain of utopianism on the behalf of ‘The Economist’ that regards this same change as being PURELY beneficial for profits without any negative ramifications seems equally myopic. Such a lack of pragmatic foresight in such quarters is a rare thing. One can only assume that such a lack, four years into the great recession, is indicative of a heightened desperation.

 

 

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