The Wealth of the Commons

The greatest problem of our time is that for centuries we have been steadily weaned away from treating our common resources responsibly and carefully so that they can either regenerate or be repaired or replaced after use. Until the Middle Ages local resources such as pastures, woods and fishing waters were really handled that way. But since the 16th century, when agricultural capitalism first began (Wallerstein 1974), these resources were enclosed and privatized by feudal lords. This soon led to the justifying myth that individuals take better care of their own property than communities. It was that myth which wiped out the ancient memories of responsibility for local common resources.

With global resources such as air, water, raw materials and entire ecosystems it has been quite different. These were once seen as inexhaustibly abundant, enabling everybody to use them for free and without any duties to preserve or replace them. In our day we have barely begun to realize that they are finally becoming scarce. But now it is property law that preserves the ancient perception of their unlimited availability. Since the law imposes few if any restrictions on access, the law continues to absolve owners of any obligation to respect global resources.

In seeking the reason we discover that this kind of freedom is the condition for an endless expansion of capitalism. The essence of capitalism is “to accumulate by dispossession” (Harvey 2003), since the progress of capital accumulation depends on the capability to find and exploit new external sources of wealth that can be appropriated.

In this sense property rights fuel the expansion of capitalism. They invite property owners to externalize costs on to those resources that ought to be treated as common property. Externalizing costs means using shared resources to the point where they are exhausted while failing to maintain or reinvest in them. The displaced costs are borne by the resources themselves, which are diminished and depreciated, as a way to boost profits. Thus property law encourages the opposite of sustainability. It promotes the relentless consumption of resources and thereby enhances capitalism. What we need is the contrary: to encourage sustainable ecological stewardship by reinvesting externalized costs, i.e., profits, into the preservation of resources.

A legal rule to preserve the global resources

In order to illustrate how this could be accomplished, take German property law as an example. Its central rule is laid down in §903 of the German Civil Law (Bürgerliches Gesetzbuch, BGB), as follows: “The proprietor is entitled, as far as neither the law nor any third-party claims stand in the way, to deal with his property at his discretion, and to exclude others from any influence.” Now consider what might occur if the legislature would alter this rule by adding the clause, “…provided he upholds the responsibility to preserve the common resources he uses.”

The term “common resources” would refer to Article 20a of the German constitution (Grundgesetz), which requires that “the state protect the natural foundations of life,” and to the notable requirement in Article 14.2: “Property obliges. Its use shall as well serve the common welfare.” The insertion would restrict individual property rights by imposing a duty to preserve any common resource the proprietor has used or caused to be used. In other words, a proprietor would be required to pay for replacement of what he used or consumed (just as he might pay the costs of preserving his private possessions).

Such a legislative amendment is needed because present laws constitute a barrier to sustainable stewardship of natural resources, and a particular barrier to the task of commoning, Peter Linebaugh’s term for the self-determination of commoners in managing their shared resources (Linebaugh 2008). Without amending the law it would not only be difficult to create and manage local commons as exchange trading systems and complementary currencies (Lietaer and Belgin 2011), it would be nearly impossible to establish networks that manage the preservation of global resources as commons. Under current laws each single stockholder of a corporation can sue the management for having ordered investments in protection of the environment that go beyond existing law. Because corporations are so deeply committed – legally and economically – to make profits by externalizing costs, how could managers be persuaded to invest this profit into preserving the consumed global resources? It is impossible so long these resources are not acknowledged as common property.

Commoning the global resources, or some of them, must therefore begin with lobbying to convince legislative bodies to withdraw any legal rules that allow or even induce persons, companies, councils or governmental authorities to exploit global resources. Those rules must be replaced with responsible regulations preserving global resources.

The core of commoning is agreement and monitoring

That prerequisite being accomplished (or anticipated), the next step must be to transform a resource into a commons. The German term is allmende, a word that once referred to any local community of free people that decided on their common affairs by their own right; common pasture, common wood were historically just the most recent forms of the allmende before it was disbanded (Grimm 1854). Today, in reviving the term allmende we mean a common resource alone, but also the community that manages it as a commons. This is what the term “commoning” means: Managing the resource as a commons, in other words actualizing the allmende principle – the principle that the community members moderate their demands on the resource by mutual agreement and mutual monitoring and enforcement (Scherhorn 2012, following Ostrom 1990).

Thus the core of commoning is that the community members agree on all rules of conduct and procedure, and that they supervise resource use by social control. They determine themselves – often supported by public authorities – how the resource shall be handled and what sanctions for violations shall be imposed. That makes the commons distinct from both the market and the state, which rely upon prices and instructions, respectively, to affect people’s behavior. The members of a commons, by contrast, are motivated by their deliberate convictions, inner direction (Riesman 1950), or self-determination (Deci 1995), at least in smaller-scale commons. Commoners are surely not immune from anti-social behavior such as “free riding” deserving of sanctions, but such punishments are more likely to be effective if they have been agreed upon.

An example of a local resource commons, among many others, is the lobster fishery around the island of Monhegan on the coast of Maine in the US In a case study, Princen describes it as:

an evolving system of largely self-regulating fishery management, an evolution,, a series of experiments, that continues to this day.... It has three major developments: a self-imposed half-year closed season formalized in a 1907 state law; a self-imposed limit on the number of traps per lobster-fisher instituted in the 1970s; and, most recently, an unprecedented, state-sanctioned limited-access fishing regime for the island. The context is nearly two centuries of ever-increasing pressure on the lobster fishery along the Eastern seaboard of the US and Canada and the threat, realized in many places, of depletion and loss of livelihood (Princen 2005).

Global resources need local protection

Perhaps the only example of an effective global resource commons is the famous Montreal Protocol on Substances that Deplete the Ozone Layer, an international treaty which was signed 1987 by 48 countries and today has nearly 200 signatories. Over the years, the agreement has “been amended to further reduce and completely phase out CFCs, halons and other chemicals…Several subsequent meetings of the signing countries were convened to track overall progress…The full recovery of the ozone layer is not expected until at last 2049” (Encyclopedia Britannica).

The singular success of the Montreal treaty indicates how limited the range of effective agreements between states will be, especially if compared with the series of international conferences on climate protection. For the time being the attempts to build an international climate regime are altogether a trial-and-error process to transform a global open access resource into a global commons, as Wolfgang Sachs has observed (Sachs 2009).

Apart from treaties between states, there are currently two basic strategies for protecting global resources: emissions trading and commons trusts. Emissions trading requires that the emission of CO2-equivalents be restricted to the amount of emission rights the emitter has bought, and that the overall amount of buyable rights will be reduced over time. Hence the price of the emission rights will rise, the quantity of emissions will be reduced, and the climate system as a global resource will be preserved. A commons trust (Barnes 2006) is an independent non-profit enterprise assigned with fiduciary duties to look after the long-term interests of beneficiary commoners, and the power to sell and restrict emission and extraction rights. The trust should be assigned the sole responsibility of preserving a given common resource and be required to distribute any remaining receipts to the people who hold a stake in that resource.

Both concepts depend upon governments to set effective, enforceable rules. But where preserving a common resource results in shortages, governments must withstand the concentrated pressures exerted by buyers, sellers and workers who insist upon economic growth as a source of earnings, sales and jobs. The Monhegan example shows that such pressures can be overcome peacefully, if one group of buyers, sellers, and/or workers who are strongly motivated for sustainable development defend their interest in resource preservation against other groups with somewhat lower legitimation. The state’s role is then to mediate the conflict instead of imposing a regulation influencing people’s decisions by outer stimuli like prices or instructions.

A network for sustainability

The above-suggested legal regime – which stipulates the preservation of natural resources and thereby forbids the externalization of costs – would be a general rule intended primarily to stimulate a general understanding that we are as responsible for our common resources as for our private plants, facilities and investments.

At the same time it would be the basis of specific regulations that may prove to be a necessary condition of legal security. Since externalizing is still common practice, however, it would not be reasonable if we left it wholly to government authorities to find out and prescribe how externalization should be avoided or compensated in each of numerous specific situations. The general rule, if it were in force, would open a second way. It would encourage those who prefer cost internalization to contribute to that search process by joining in communities that work out agreements on what is needed to preserve specific common resources after use. These communities can be characterized by four basic elements: 1) community members 2) who moderate their demands on the resource and reinvest in its preservation by 3) mutual agreement and 4) mutual monitoring.

1. The kind of cooperative social relations that result in taking care of a common resource can arise among suppliers of a specific product as well as among consumers. Suppliers who compete with each other are more aware than others of each other’s actions and even costs, and consumers may be in contact with each other through civic associations, Internet communities or advocacy organizations. In either case, the contacts can be local, national or worldwide.
2. Commons of either consumers or suppliers can arise if the need to moderate demand for a specific resource – copper, wheat, fish, oil, electricity, water, soil, etc. – becomes evident, perhaps because the resource is becoming scarce, its price is rising or will rise, or the means can be found to use less of it – through recycling, substitutes or alternatives in production.
3. Mutual agreements between competitors are prohibited by law if they restrain competition, but that should not hold for agreements to internalize costs.
4. Mutual monitoring is a kind of what sociologists call informal social control. It occurs continuously since competitors cannot help but notice and observe each other, and buyers cannot help but compare and assess products and suppliers, and exchange their knowledge among themselves.

These four elements could themselves meld into a network of commons, because a growing number of both suppliers and consumers who long for the opportunity to preserve the resources, will be motivated to preserve the resources they use and to prevent others from continuing to externalize costs, which until now has worked to the disadvantage of those who want to internalize costs. Thus their activity would be helpful and even necessary to enforce the law, whether by recommending a government mandate or by agreeing on customary procedures as substitutes for mandates. In either case, a commons would likely be superior to an external government authority because competitors can better judge whether and what costs are being externalized than any public prosecutor or district attorney, and criticism by civic and consumer associations can be more powerful in persuading a firm to internalize its costs than the risk of litigation (provided there were a legal basis).

In order to make it easier to join in commons of the type indicated, the legal basis for accountability should be even further broadened by amending the com­petition law, too, which under the current property law forces competitors to externalize costs. Any hidden externalization of costs should from now on be treated as unfair competition, which is principally forbidden by law in several European countries and most states of the US, although with different provisions. Take, for instance, the German law against unfair competition (Gesetz gegen unlauteren Wettbewerb, UWG). It prohibits a supplier from enjoying a competitive market advantage by making deceptive claims about its product(s), as misleading advertisements or taking advantage of consumers’ lack of knowledge.

The amendment would consider it unfair competition if a company hides his externalizing practices rather than paying the full costs of protecting or renewing them. Since the UWG permits competing enterprises and civil associations like consumer unions to sue a firm for unfair competition, one can imagine that conscientious firms trying to preserve global resources would use this legal provision to prevent their competitors from achieving an unfair market advantage. And since courts can decide that profits from unfair competition be transferred to the federal budget, management would prefer to reinvest in and protect global resources rather than to be accused of externalizing costs.

Entrance to new perspectives

In this way amendments to property and competition laws could help bring into being a network of commons-like communities of enterprises, civil associations and individuals that would monitor the use of global ecological resources. While there is a huge variety of separate problems that have to be solved in this field, encouraging the formation of commons would not only be an effective way to enforce the law but also a way to bring about a general awareness of common resources and everybody’s responsibility for them. This, in turn, could open the door for two hidden implications of sustainability that are already knocking at it but aren’t allowed to enter.

First, by getting serious about preserving global resources, and acknowledging that markets are not inseparably joined to capitalism (Braudel 1977), sustainable development could become separated from capitalism but aligned with the market economy.

Second, not only natural resources ought to be treated as global commons, but so should the many socially organized institutions that provide employment opportunities, public health systems, educational opportunities, social integration, income and wealth distribution, and communication systems such as the Internet.

To put it in a nutshell: Sustainability is commoning global resources by applying the commons principle of wisely moderating demands on common resources. It is time to ask what perspectives will open up when we proceed this way.

References

• Barnes, Peter. 2006. Capitalism 3.0. A Guide to Reclaiming the Commons. San Francisco. Barrett-Koehler.
• Braudel, Fernand. 1977. Afterthoughts on Material Civilization and Capitalism. Johns Hopkins University Press.
• Deci, Edward. 1995. Why We Do What We Do. The Dynamics of Personal Autonomy. New York. Putnam’s Sons.
• Encyclopedia Britannica, “Montreal Protocol,” available at http://www.britannica.com/EBchecked/topic/391101/Montreal-Protocol.
• Grimm, Jacob and Wilhelm Grimm. 1854. Deutsches Wörterbuch. Reprint München 1999: Deutscher Taschenbuch Verlag.
• Harvey, David. 2003. The New Imperialism. Oxford. Oxford University Press.
• Lietaer, Bernard and Stephen Belgin. 2011. New Money for a New World. Qiterra Press.
• Linebaugh, Peter. 2008. The Magna Carta Manifesto: Liberty and Commons for All. Berkeley. University of California Press.
• Ostrom, Elinor. 1990. Governing the Commons. The Evolution of Institutions for Collective Action. Cambridge, MA. Cambridge University Press.
• Princen, Thomas. 2005. The Logic of Sufficiency. Cambridge, MA. MIT Press.
• Riesman, David. 1950. The Lonely Crowd. New Haven. Yale University Press.
• Sachs, Wolfgang. 2009. Proceedings of an International Meeting at Crottorf Castle, Germany, by Silke Helfrich. http://www.archive.org/details/crottorf-commoners.
• Scherhorn, Gerhard. 2012. Die Welt als Allmende. Für ein gemeingüter-sensitives Wettbewerbsrecht. In: Silke Helfrich and Heinrich Böll Foundation, eds.Commons. Für eine neue Politik jenseits von Markt und Staat. transcript-Verlag.
• Wallerstein, Immanuel. 1974. The Modern World-System: Capitalist Agriculture and the Origins of the European World-economy in the Sixteenth Century. New York. Academic Press.

The author wants to thank David Binder for effectively translating his German English into the native language.