Dr W Large

The New Information Economy and Regulation of Capital

Hitherto in our reading of Empire, we have been investigating the previous forms of sovereignty or the passage to the new one. This is the first chapter in which the authors face head on the new sovereignty (or even absence of sovereignty) they claim exists in the first pages of the introduction. They first of all approach it, and this should not surprise us, through their neo-Marxist slant, through the change in the world economy. Of course we need to be careful here. Negri and Hardt are not crude materialists. It is not the economy in itself that determines the course of history, but political struggles, and these struggles themselves are shaped and created by people’s desires and needs, as we have seen their analysis of the ‘counter culture’, for example, of the 60’s.

      Their thesis in this chapter is that the world economy has gone through a major upheaval in recent years to an information economy. If we look back in human history we can see a previous equally massive upheaval and this was the movement from an essentially agricultural economy to an industrial one. In recent times, we are now moving from this industrial economy to an informational one. What is important about these upheavals is that they are not just a change in production process, but also in human nature and ways of being human. In the first movement from agriculture to industry, there was a massive movement of the rural population to the industrial cities like Manchester and Birmingham. But we have also seen that this meant a complete change in how people lived in the disciplinary society. Everything is for the sake of production and nothing else until society itself becomes a great big factory. This period of modernisation, however, is now at an end.

      This is first of all demonstrated in the quantitative change in the nature of employment. In the first phase there was a movement from the primary sector (agriculture and mining) to the secondary sector (industry). Now there is a movement from the secondary sector to the tertiary (service industries). This does not mean that industry does not have an important role in the economy, just as agriculture did not disappear with the move toward industrial society, but just became more industrialised. Rather, industry itself becomes like a service industry, and is subsumed beneath the information economy especially in relation to the finance sector.

      The passage from the industrial to the information economy also marks a change in the nature of labour, though we must always remind ourselves that it is not capital itself which changes labour, but labour capital: ‘machines’ as Marx says, ‘always follow strikes.’ It is the change in labour where we see the change in human nature and ways of being human. We can explain this change as the movement from the Fordist to the Toyotist model of production (In Aglietta, Neo-Fordism, and in Lazzarato, Post-Fordism).[1] What is at the heart of this change is not just the application of the computer to production, but the information flow between the producer and the consumer. The aim is to have as little stock a possible (‘Just in time’ production) such that the whole production line responds to the individual desires of the consumer. This changes the relation between production and consumption. Rather than production determining consumption, consumption determines production. It is with the rise of the service and affective economy, however, that we really begin to see the importance of information, the increase in immaterial over material labour and this shift from industrial to post-industrial capital. Negri and Hardt, therefore, define immaterial labour as the production of immaterial goods as a service, product, knowledge or communication. It has 3 basic forms:

1.      Technological use of information technology to determine all aspects of production

2.      Analytic and symbolic tasks – the production of ideas and ‘concepts’.

3.      The manipulation of affects – both in terms of the health industry and the culture of ‘life-styles’.

The first is the creation of ideas and new types of knowledge, but has as its underside all the menial jobs of data entry and the other mindless actions of the IT industry. The second is the central of ‘problem solving’ and strategy which is at the heart of all postmodern production, but which has as its base the continual ‘auditing culture’ and ‘perpetual training’ of which Deleuze speaks in the ‘Society of Control’. The third is the explosion of health services, but also all the new ‘life industries’ including the new media industries. Nonetheless, the rise of these new service industries seems to provide the seeds for their own destruction, for what is immanent to them all are co-operation and communication, imposed not from without but from within. This breaks with the old Marxist model of labour as variable capital, which implies that there is no value to labour outside of capital. All these new service industries need other people, and creative and co-operative relations between them, which are not necessarily supplied by capital, and thus the authors write:

In the expression of its own creative energies, immaterial labour thus seems to provide the potential for a kind of spontaneous and elementary communism.[2]

      The effect of the passage from the industrial to the informational economy is the decentralisation of the production process. The industrial revolution required the concentration of populations into cities, but the new service sector no longer needs this. The network has replaced the assembly line. In the latter, communication was limited to physical proximity and the efficiency of supply and demand by distance. Information makes space more and more irrelevant. Negri and Hardt describe this as the ‘deterritorialisation of production.’[3]

      Before we begin, however, to celebrate the new postmodern information age, immaterial production places labour in an increasingly difficult bargaining position. Since capital no longer requires the proximity of workers to production, if there is a sign of trouble then it can simply move production somewhere else in the network. The flip side of the decentralisation of production is the centralisation of the command and control of production. In the local perspective, this has led to the increasing monitoring of labour, and in the global, which is the more significant, it has led to the concentration of capital into the new global cities of London, New York and Tokyo. The collapse of industrial cities has led to the rise of the global city, which are really ‘cities of control’.[4]

      The passage from the industrial to the informational economy should therefore be only seen through the world market. Decentralisation of production means that capital is increasingly free to move where it wants. This fluidity of capital completely destroys the old fashioned linear model of development, where countries are supposed to move through the stages of economic history until they finally reach the stage of the G-7. This forgets that the relation between the developed and supposedly developing countries is hierarchical. The developing countries are subordinate to the dominant economies, which means that a linear development is completely impossible, because the dominant countries simply export their capital abroad. The authors use the example of the factory in Brazil in the 1990’s. Now according to the linear model, Brazil should be moving from the agricultural to the industrial economy, thus the factory should be like a factory in Chicago in the 1930’s. But this is manifestly not the case. On the contrary, when a dominant economy exports its capital abroad it does so at the highest level of technological advancement. Thus the factory in Brazil belongs to the informational model. The important point to realise, however, is that this factory of the 1990’s belongs to a subordinate economy, whereas the 1930’s factory in Chicago belonged to a dominant one. This changes everything. Thus even though Brazil might contain all 3 levels of production, agricultural, industrial and even informational, it will never reach the dominant level, and it will forever be outside the command of capital. Capital can just as much flow out as flow in and the subordinate economies have no control over it whatsoever.

      The development of capital has always been the expropriation of common property and public spaces. We have seen this in our own time through the privatisation of public utilities and the increasing privatisation of the NHS, all of which were built up by large amount of public expenditure and then sold cheaply to private capital in order to make huge profits in the future. Rather then weep at the loss of this common property, we need to see what is common to day. Indeed, for Hardt and Negri, what is common today, is much greater than what was common in the past, but it is a commons that is quite different in nature. It is not a commons of spaces, but of relations, and the relations of communication and cooperation. It is these everyday and common relations that capitalism expropriates in order to produce wealth in immaterial labour. But the great difference between this expropriation and the previous expropriate of common property, is that this social reality is always greater than capital, which means that it can never totally control it and is ontologically dependent on it. That this relation is not visible, is because of the transcendental power of capital which attempts to control social reality through juridical and political means. It is Hardt and Negri’s thesis that this control is becoming increasing weak for two reasons: one that capitalism is becoming more and more dependent on this social reality, rather than the other way around, and two, the forms of control, for this very reason, are becoming more and more divorced from reality. Before we explain where this is the case, through the later chapters in the books, we need to under how exactly, even in it must necessarily fail, capital attempts to control the new social reality.

      First of all, as we saw from the chapter ‘Two Europes, Two Modernities’, we must distinguish between the transcendent and immanent operation of power. Traditional societies operate from a transcendent centre, such as the image of the king or prince, which operates on society from the outside. The principle of sovereignty is to unity the people in the face of an internal or external enemy. The legitimation of this transcendent power is the purpose of political philosophy that we find in Hobbes, for example. It is this kind of power that is disappearing from the world, although people still talk as though it exists. The new kind of power, which operates through capital is immanent and not transcendent. Importantly, this means that there is no centre any longer to power. It does not operate from the outside, but from the inside, and it is not localised but everywhere. Rather than vertical and hierarchical, it is horizontal and flat. The historical movement from a transcendent to an immanent form of power, Hardt and Negri call a ‘deterritorialisation’ (an expression that they borrow from Deleuze and Guattari), whose mechanism is capital. Thus the change from one political structure to another is not political in the juridical sense, but economic. Without capital there would be no political change. We would still be living in transcendent societies (we know, however, that the change in the regime of capital is itself caused by the desires of the multitude and no the other way around – economic change in dependent on a more fundamental political ontological reality, which has nothing at to do with the politics that we see and hear on television and radio). How does capital destroy transcendent societies? Through 3 mechanisms: the mobility of the proletariat, money, and the economic laws that are immanent to capital itself (such as profit, exploitation and surplus value). To use the language of Anti-Oedipus, labour, money and capital are great decoded flows that rip through the despotic codes of transcendent societies.[5] But if these flows are not to lead to chaos and revolution, they too must be controlled and regulated. And since this flows are so powerful and destabilising of traditional structures which have kept societies unified, then they will need to be even more powerful. To describe the difference, therefore between the transcendent power of the State, and the immanent power of capital, Deleuze and Guattari will use a different word: axiomatics.

      One way of understanding the difference between despotic power and axiomatics is through the work of Foucault. He analysed the movement from one to the other through the passage from sovereignty to governmentality. This is also the movement from the disciplinary society to the society of control. It is true that the operation of power within the disciplinary society is immanent: the subject must discipline itself. But the self-discipline finds its support in transcendent institutions, such a prisons, hospitals, and military barracks, which operate, to some extent, at a distance. It is these institutions which are fundamentally in crisis in post-industrial societies: ‘In the passage to the society of control, the elements of transcendence of disciplinary society decline while the immanent aspects are accentuated and generalised.’[6] Disciplinary regimes produce standard fixed identities like machine parts that can be assembled on the production line (Plato’s theory of the State the Republic is the ideal state society, where everyone has a fixed identity and function), whereas in the post-industrial society, the society of control, there are no fixed identities because they are no longer any stable institutions. This is why previously, Hardt and Negri, were so dismissive of postmodernism because it celebrates the very effects of capital, whilst thinking that is being critical of capital.[7]

What occurs at the level of society also happens at the level of international relations. Just as civil society disappears in the nation, then the nation disappears in the global power of capital, since as we have already seen, the development of capital and the institution of a world market are inseparable.[8] It is important that we distinguish between imperialism and globalisation. The first is still dependent on the existence of nation states, whereas the second is not. In the latter, nation states are dissolved in the global flows of capital, rather than capital being dependent on the nation states. It is for this reason that Hardt and Negri are dismissive of any politics which is dependent the independence of so called ‘Third World’ countries, since global capital has done away with the nation state, and secondly, the nation state is itself a repressive structure.

If capital is what now controls the world, rather than nation states (or attempts to control it) how does it do so? It does so through two primary systems, one local and the other global (though we must remember that the local is always immediate linked to the global and the global to the local). The first is administration and the second is command. Just because the transcendent society has disappeared, does not mean that control has vanished. It fact it has probably become worst. Immanent societies operate through the permanent state of fear. Fear from the inside, that societies will be overrun by the underclass, and fear from the outside, that will be destroyed by terrorism. Thus we see all around us the emergence of gated communities (think of the King William’s Yard in Plymouth, which has a permanent security guard) and constant surveillance (Stonehouse is now surrounded by CCTV cameras). Not to mention the invasion of Iraq, the dismantling of civil liberties, and imminent bombing of Iran. The fear of poverty, unemployment and violence, is far more effective than the sword for keeping people in check. The society of control is administered through fear, but what is the form of this administration? In despotic feudal transcendent societies, the aim of the state is to unify the people, and therefore eliminate difference. In the society of control, on the contrary, difference is not abolished, but maintained, but in such away that differences do not become mixed but retain their identity. An example of such a process was already given by Hardt and Negri is the description of the new racism.[9] We celebrate difference, but some differences are more different than others. There is no single actor or centre of centralised political decision making, rather administration becomes linked to particular pressure groups and activities all regulated by the structural logics of the military, police, economy, ideology and communication, and the success of administration is its ‘local effectiveness’.

The difference between command and administration, is that the former is global is power is not exercised through the mediation of the state but directly through capital. Its object is not to normalise and command the multitude (and objective that is ontological impossible for Hardt and Negri). The primary task of capitalist command, on the contrary, is to prevent the multitude from becoming an ‘absolute democracy’. It does this through 3 mechanisms the bomb, money and ether. The existence of nuclear weapons means that for the first time the human species can annihilate itself in its entirety. First, the bomb has reduced every war to a civil war, a dirty war and terrorism. This means that every military action has become a police action. Secondly, the international money market means that every national market has ceased to exist. The threat of the flow of capital is neither transcendent nor territorial, but it nonetheless authorises monetary regulations to determine the market. Finally, communication and media has succeeding in completely subsuming the world to the regime of capital through the spectacle of production and consumption. If the command structure of capital is so powerful and deterritorialised, why then is it necessarily doomed to failure? It is this question that Hardt and Negri must answer in the next part of Empire.