There’s more than a fleeting echo, in the cadences of the opening paragraph of Jeremy Rifkin’s new book, “The Zero Marginal Cost Society”, of Marx and Engels’s “Communist Manifesto”. But in this case the spectre haunting not just Europe but the whole of the developed world isn’t communism, it’s a “new economic paradigm” that Rifkin calls the “Collaborative Commons”. The cynosure of this new paradigm won’t be the exchange of private property in markets; it will be the “access of services in the Collaborative Commons.” Rifkin writes: “The capitalist era is passing… not quickly, but inevitably. A new economic paradigm… is rising in its wake that will transform our way of life.”
Like Erik Brynjolfsson and Andrew McAfee, authors of another of this year’s most talked-about works of non-fiction, “The Second Machine Age”, Rifkin believes that the technological transformations of the digital age will be as far-reaching as those of the first and second Industrial Revolutions. And like Marx, Rifkin thinks that capitalism will undermine itself. Not because it produces its own “gravediggers” in the form of a mobilised industrial proletariat, but because its “operating logic… succeeds beyond anyone’s wildest expectations.” The argument runs something like this: increasingly intelligent machines will generate products at nearly zero marginal cost—in other words, the cost of producing each additional unit falls to essentially nothing. And when that happens, everything becomes free, profits disappear and… capitalism eats itself.
We’re clearly living through a period of dramatic technological change, but not everyone draws the conclusions Rifkin does, or is quite as optimistic about the future as he is. Take the former US Treasury Secretary Larry Summers, who thinks we’re in the midst not of a transition from one economic paradigm to another, but rather of the long-term, “secular” stagnation of the developed capitalist economies. When I met Rifkin in London earlier this month, I began by asking him what grounds he had for his long-run optimism.
JR: It’s interesting that you mention Larry Summers. I think the difference [between us] is that Larry glimpsed the problem, but was not able, given who he is and what his background is, to say where it might lead. I think the Collaborative Commons is the first new economic system to appear on the world stage since the 19th century—since capitalism and socialism. So I think it’s a remarkable…