Capitalism Reborn

I'm trying to pull a lot of different themes together today, and that might make this a very long post...

I try to keep the key theme of this blog as being that 'the future' is already here. By 'the future', I mean the technological utopia - or at least, the technologies to create and sustain that utopia - envisaged in a particular kind of (predominantly 1950s and early 60s) optimistic vision of the future. Sometimes that relates very clearly to writing, sometimes less so.

Last week, I presented a two-stage argument that the future has already in a sense left us behind, but that the problems we see and fear in it are still within our powers to face and defeat. In essence, I argued that technology not only is but should be here to stay.

Today, I want to take these ideas, which may not seem to have much direct contact with the writing business, and link them to where I'm going with my professional efforts as a writer. In doing so, I want to outline a radical change that we have the opportunity to make in how capitalism as a system works.

This starts with a big concept - scarcity - and a set of technological advances - the e-reader and the internet. Basically, it's now incredibly cheap to distribute 'books' (and lots of other things that are like books in some way, or can otherwise be digitised). I can put a book up on Smashwords, and it can be reproduced infinitely and distributed for a negligible cost.

Books, and digital content in general, have become 'post-scarce'. For people above a certain technological threshold, there is no material limit on the number of books we can own or acquire (okay, there's hard drive space, but I'm pretty sure even my aging hard drives could store more books than there are remaining hours of my life to read).

Capitalism as we know it, and as we've been developing it for the last two or three thousand years, is based on scarce commodities - commodities of which the supply is limited. It's that limit that has justified charging a price for anything, and the only things you get for free have always been the things you carve out from nature using your own labour. So our current understanding of capitalism is pretty poorly-equipped to adjust to post-scarce commodities (as you may have noticed...)

That's all very abstract. Here, for me, is the key difference-making shift: the pay-what-you-like model (PWYL). It's now possible for Smashwords (and Bandcamp, and the Humble Bundle, etc. etc.) to offer my work for free and let readers decide what they think it's worth. Heck, I wouldn't need to learn a lot more programming before I could host a website where I did this myself.

Obviously, PWYL is at the moment only feasible for digital goods (though I just learned that Jon Bon Jovi's foundation runs a non-profit restaurant that works on a similar principle), because these are the only goods that are in any way post-scarce (and, yes, not post-scarce for everyone, which is a problem we need to fix). There's a fascinating question to be asked over whether essentials could ever go to PWYL, but it's a question for another time.

Let me detail the change I see PWYL making to capitalism. As I understand it, the purpose of any economic system (if such an idea has any meaning at all) is to ensure that goods are traded at something approximating to their actual value. To put it another way, the idea of capitalism is that it should set an appropriate value on things.

Now, whether capitalism is a good system for that purpose overall is open to debate. The modern version is certainly preferable to the gold-standard mercantilism that it replaced (which was basically an instrument for European nations to exploit 'the colonies'). The triumph - if triumph it is - of capitalism over communism is more ambiguous, if for no more reason than that the communist states that were actually triumphed over generally did quite a bad job of their communism. All that's a debate for a different time, and probably a different blog.

The problem (or at least, the one I want to talk about) with capitalism is that it involves two separate layers of guesswork about the value of any item. First, the producer or distributor guesses at a price to set, and then the consumer or buyer guesses at whether the item is worth that much to them. That's two chances for the calculation of what something's worth to go awry.

With PWYL, the risk is halved (and, honestly, I think consumers tend to be better than producers at price-guessing, so it's the bigger half that's removed). People will pay what they think your book is worth to them (which, as I've argued in the past, is the only way something is ever worth anything). It's still a guess, but it's a guess based purely on how much they trust you to entertain or enrich them through your writing.

That greatly streamlines the whole process. In particular, it brings to the fore what I view as the key element of a career in the creative industries - trust between producer and consumer. You have to earn the right to make a living from your creative work, and you earn that right by earning the trust of your readers.

Let's be completely honest for a moment. As writers, we are all people who, if we were born rich or otherwise independently wealthy, would still write and want people to read our writing. Even if there was no reason for us to want money for the process, we'd still write. We might write a little less frantically, and I imagine we'd all cut right back on the marketing (doesn't that sound heavenly?), but we'd still be doing it. That's who and what we are.

The thing is, while books have become post-scarce, a writer's time has not (how could it?).
As far as I'm concerned, when a reader pays for my work, he or she is not reimbursing me for time already spent - after all, it's time I'd have spent at some point anyway, just to get the voices in my head to pipe down for a bit :-P. They're making a statement of the value they put on my literary career.

(sidebar: obviously, I'm not claiming that when a reader pays (let's say) $2.99 for a book by me, they're saying they think my career is worth $2.99; they're saying it's worth that much to them per unit. The total value of my career is then worked out as [consumer 1's valuation * number of units consumer 1 buys] + [consumer 2's valuation * number of units consumer 2 buys] + ... + [consumer n's valuation * number of units consumer n buys]. I'm not claiming that a consumer makes a guess at this calculation before choosing a price - the beauty of this way of thinking about it is that it simply and efficiently creates a composite of all these distinct valuations.)

With PWYL, there's a huge boost to the freedom readers have to make that valuation. A system that was rigid, a system that entrenched mistakes, has become much more flexible, which can only be a good thing.

Why am I making such a fuss about it? Well, this Saturday, as I've been hinting I might do for a while, I'm publishing a standalone short story on Smashwords, on PWYL. It's called 'Immortal Remains', it's just over 8,000 words long, and it's up to YOU to choose what it's worth. More information on Saturday, so stay tuned!