Zero hour for production costs in Paul Mason’s new book Postcapitalism

Capitalism is bad. You agree, right? Yeah, it’s awful. So capitalism will wither away. I, by theorising, will be able to come up with a way in which capitalism will explode, and be replaced by … something. I don’t know what. But it’ll be better.

This outlines the format of a particular genre of Marx-inspired political treatise. Paul Mason’s book Postcapitalism: A Guide to our Future belongs to this genre.

It is a genre of fiction.

Every book in this genre makes the same kind of mistakes, and Paul Mason’s is no different.

These books don’t understand what capitalism is, and they really don’t understand how to do social science.

Capitalism is what happens when people trade with one another using money instead of bartering. So it isn’t the kind of thing that can end. People have always traded with one another, and they always will. And they’ll use money to do it – it’s easier than guessing how many chickens are equivalent to one e-book of Postcapitalism by Paul Mason.

So capitalism is a place holder term for billions of people doing different things. It is a set of as many different sets of organisations, institutions and populations as there are countries, cults, and tribes. One narrative does not apply to all of them – it is just too big a set to generalise over.

That’s all capitalism is.

It isn’t the kind of thing that can be broken, or can end.

Of course, that isn’t what anti-capitalists are talking about when they talk about capitalism. They mean systematic inequalities in power and global economic injustice.

Fair enough – those are bad things, and real problems.

But actions and employment both good and bad are consistent with capitalism, See, for instance, Sharia-compliant finance’s attempt to rid the world of communicable diseases. Or financial derivatives that allow investors to buy into research into cancer drugs.

What anti-capitalists really want is an end to man’s inhumanity to man – starting with the world’s most powerful people.

The world is unequal and unfair. But that doesn’t imply that there are fundamental laws of economic development that make it that way.

Books like Mason’s are forced to deliberately oversimplify politics. Politicians introduce new policies, disagree with each other, pick some causes that are popular and abandon those that aren’t.

The world is not run by shadowy cabals. It is not, in fact, run at all – different bits of it are run by different people with different opinions. Sometimes a plurality of them share an opinion – other times, they go to war with each other precisely because they disagree with each other so much.

This is what academics call eopluralism – the view that there is nothing fixed about who has power in society. That’s terrifying, because it makes the world very difficult to understand. It means that politics and the economy must be studied bit by bit, and cannot be studied all at once. It’s a situation that Thomas Pynchon in Gravity’s Rainbow calls anti-paranoia – “where nothing is connected to anything, a condition not many of us can bear for long”.

But let’s discount this kind of naysaying as the kind of thing that a non-Marxist would say about a book with a lot of Marxism in it. Let’s assume that you don’t necessarily think that Marxist analyses of this kind are wrong by default.

And so, to Mason’s laws of history.

Capitalism will end, he thinks, because we are on the dawn of an era of limitless abundance.

This might surprise a lot of politicians, businesspeople and economists – infinitely high productivity is just around the corner.

Mason credits this to the same technology that powered 1990s file-sharing website Napster. Napster, you may remember, was the pirating software that allowed music files to be copied and shared for free across the internet.

Technology, Mason writes, will bring about the end of capitalist society. Some kinds of information can be produced at zero marginal cost. It costs nothing to duplicate an MP3 file and redistribute it on Napster, for instance. So, Mason reasons, this dynamic will eventually apply to everything – someday soon, everything will be produced at virtually no cost.

That, as Steve Jobs was fond of saying, really will change everything.

Mason says: “Information is not some random technology that just came along and can be left behind like the steam engine. It invests all future innovation with the zero-price dynamic: biotech, space travel, brain reconfiguration, or nanotechnology …”


To see why this can’t be true, think about space travel. Physics says that to propel a rocket out of the atmosphere, you need a lot of energy.

But energy isn’t free – natural resources are finite, and renewable energy costs time, capital, and labour to install. It is not obvious how the ability to replicate digital goods indefinitely can reduce the marginal cost of producing energy to zero.

So, in this case, the laws of physics require a non-zero economic cost.

This also applies to logistics, manufacturing and construction – indeed, all secondary industries, and all industries where physical objects are made.

Technology can do amazing things, and digital replicability has changed and will change the world. But can it make the cost of creating and delivering all goods and services fall to zero? Mason gives us no reason to think that a skyscraper can be built, or a hotel operated, at a zero marginal cost.

Assembling things is not the only task that needs irreplaceable inputs – inputs that can’t be swapped for free software.

Machines are not intelligent. They cannot solve complex problems with undefined, vague terms. Defining goals, and applying creativity to the scope of human wants, will always be a human, not a mechanical task.

At least until artificial intelligence arrives. Mason doesn’t discuss this possibility in detail.

Then there’s Mason’s idea that free information somehow undermines markets. Because information undermines the price mechanism in some instances, it will eventually become impossible to price anything, he says.

Both corporate history and economic theory suggest the opposite. In economics, information determines the efficiency with which a market works. When buyers and sellers have clear signals about each others’ preferences, the baker shows up at the market with the correct quantity of bread. Uncertainty is a hazard to bakers and insurers alike.

Mason was previously economics editor at the BBC’s Newsnight programme. He did a lot of great reporting about the euro crisis – a political battle that really does pit a predominately neoliberal elite against left-wing governments and activists.

But the whole world isn’t involved in such a battle.

Mason’s pre-existing beliefs, heavily influenced by Marxism, lead him to assume that the world is engaged in this battle writ large.

They lead him to discount his knowledge of economics in favour of bad theory from an era before social scientists bothered to test their ideas.

This book is for people who basically accept the kind of analysis this sort of book always gives – that the System is broken, that the System will collapse.

It appeals to a small set of dedicated readers, it abides by genre conventions, and it will be spurned by mainstream social scientists who use their ideological standards of evidence to rule out the kinds of arguments deployed.

It is a work of genre fiction.

q&a Humanity is core vision

Adam Bouyamourn expands on Paul Mason’s Postcapitalism: A Guide to Out Future, released in July this year:

What does Mason say about capitalism?

He says: “It is the whole system – social, economic, demographic, cultural, ideological – needed to make a developed society function through markets and private ownership.” It is governed by neoliberalism – the idea that free markets are always good, and that the rich can ride roughshod over the rest. This has terrible consequences for the global South, the workers, the poor.

But what is capitalism then?

Capitalism is not one thing, but many – it is a placeholder term that describes billions of people doing different things. It is a set of as many different sets of organisations, institutions and populations as there are countries, cults, and tribes. One narrative does not apply to all of them – it is just too big a set to generalise over.

And is it bad?

The world is a pretty rough place. It is unequal and there is lots of exploitation. But that is not because it is a single economic system with a single, fixed set of rules. The world is not run by a shadowy cabal of neoliberals. Instead, it is a network of thousands of institutions with different amounts of power and motivated by different ideologies. Exploitation happens because some people choose to exploit others. It is not an inevitable consequence of anything – inequality provides the means, but individuals must provide the will. Mason doesn’t want the end of capitalism. He wants the end of man’s inhumanity to man.

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