Venture Communism and Technological Miscommunication

This interview with Dmytri Kleiner, conducted by KMO for his C-Realm Podcast, was transcripted by Guerrilla Translation at KMO’s request. The audio was, unfortunately, unusable for the podcast because of background noise, but the resulting interview was too good to not to share. The following is re-posted from the C-Realm blog. 

KMO: You are listening to the C-Realm Podcast, I am your host, KMO, and I’m speaking with Dmytri Kleiner, venture capitalist and miscommunications technologist. Dmytri, welcome to the C-Realm Podcast.

Dmytri: Thank you, but that’s “venture communist.”

KMO: Did I say “capitalist?”

Dmytri: [chuckles] It’s an easy mistake.

KMO: You know, I’ve read the phrase “venture communist” several times in the past few hours in preparing for this interview, and yeah… it just rolled out “venture capitalist,” didn’t it?

Dmytri: [chuckles]

KMO: So, Dmytri Kleiner, “Venture Communist” – what does that mean?

Dmytri: Well, it’s sort of the name of a research project I started awhile ago. My background comes from the social justice movement of the 90s. I was part of some of the kinds of hacker groups that eventually became things like Indymedia, and stuff that we called technology affinity groups. At that time there was something going on called the dotcom boom, that you probably remember. A lot of us who were part of these hacker affinity groups supporting activist projects were working for these dotcoms.

As the social justice movement began to fade, along with the dotcom boom itself going into bust, it became very clear to me that this was very problematic. These truly liberating and revolutionary communication platforms were not going to be funded by capital. And so, if venture capital wasn’t going to fund them, then we needed some other way to fund them. This is where the term originates from. It originates from the simple aversion to venture capital. If venture capital won’t fund what we need to do, then we have to create venture communism. And so, venture communism itself began as a research project. And over time, there has been some development of the concept, but I usually mean the term in the very broad sense. I have my own proposals that you’ll find in the manifesto and other texts for what approaches to venture communism might look like, or what a venture communism may be like, but I also use the term in a very broad sense that could include other ways of collectively forming the communication capital that we need.

KMO: I’ll just tell you a little bit about my relationship to capitalism and the dotcom period. I worked in customer service for Amazon.com from 1996 to 1998 and got some pretty decent stock options. When I sold them, I made more money with one phone call than I did in all the rest of my life selling my labor by the hour. I made that one call to the brokerage and said, “Exercise all of my options and sell the shares,” and I got about $660,000 with that call.

Dmytri: Wow…

KMO: Had I waited and made the call six weeks later, I would have made about $3 million.

Dmytri: Oh, wow.

KMO: And in hindsight, I’m so glad I didn’t wait. The money let me do what I wanted to do for many years, but then it ran out. By then I had moved to Arkansas where I was trying to start a homestead farm. That’s where I was living when I ran out of money and had to go back to work in my mid-30s, with a nearly decade-sized gap in my resume. There was not a lot of opportunity, really, in Berryville, Arkansas, in the early aughts. Well, I had a big change of heart, because, before that, I had been very much libertarian, politically. I had been a techno-utopian, a trans-humanist, and a Singularitarian. Those are meme complexes that tend to attract one another.

Dmytri: Sure.

KMO: Rarely are trans-humanists particularly critical of capitalism, or even cognizant that there might be something to criticize. And so, having to basically start again in my mid-30s, working really horrible jobs in sales – I started selling cell phones, and then I got into insurance, which is a really, really ugly business – my political views changed, and eventually my techno-utopian views gave way as well.

Now, I’m actively critical of capitalism. But I’m trying to articulate that criticism in such a way that it does not trigger an automatic ideological, reflexive rejection of what I have to say. Because, for so many people in this country, particularly in the middle of the country, the word “capitalism” just means “our side.” It represents everything that is right and good. Capitalism is synonymous with prosperity, and communism means totalitarian, evil dictatorship that brings austerity, and slavery. So, I’m trying to be very careful with my terms, but let me encourage you to say as much good as you can about the concepts of communism and peer to peer networks.

Dmytri: Well, I never imagined myself to be speaking to the masses or making an argument to the masses. From the beginning, I always considered myself to be an artist and to be somebody who had technological skills that could be of use to activist movements. So, I was never particularly concerned with the words that I used, and actually, I’ve always been rather attracted to strong or provocative language from “pirate” to “hacker” to “communist.” But, actually, now that I have, over the years, taken on a more “contributing to theory” kind of a role, I think that it’s quite important to continue using the word “communism”.

When I had my post-social justice, post-dotcom disillusionment, I started really engaging on a lot of forums where actual economists and political theorists participate. A little bit outside of the hacker community, in this sort of infoshop politics of “reclaim the streets,” and one thing that really frustrated the people that I was communicating with was that I wasn’t using any kind of language they recognized.

When you work in any kind of technical field, whether it’s computers, whether it’s politics, whether it’s economics, there is an established dialogue going on, and if you use the language that everybody else is using, that makes it a lot easier to communicate, to share ideas, and to really be very precise about what arguments you’re making. And so, I learned that I should understand the classical language, and that I should be able to use it.

A lot of people who like my work over the years that come from similar backgrounds as yourself, and they were reluctant to use the word “communism.” They would say, “Ah, this sounds really interesting, I like what you’re saying, but do we have to use that word? That word is so horrible and off-putting”. But, actually, that word connects you to hundreds of years of research and struggle and theory that goes far deeper and far broader than my own work does. So, by not just making up some random word – like what was it, “venture community-ism” was one of them, and other kinds of things – and by sticking to the word “communism,” it might connect you to that theory as well.

Another thing I think is really important is to understand that anything can go wrong. Anything can go badly. So even if we make up new words, it doesn’t mean that we will somehow protect ourselves from possible negative outcomes. By using the word “communism,” it is implicitly understood that negative outcomes are possible, because we have actually seen them. In using that word, we do it without naïveté. We use it with the understanding that it’s not necessarily problem-free.

KMO: I heard you say in a presentation, that when you use the word “communism,” you are talking about a theoretical society; one that has no historical example.

Dmytri: That’s true, but there are historical examples of people who tried to achieve it.

KMO: But there has never been a nation-state that embodied communism in the way that you’re describing it.

Dmytri: Well, there’s never been a nation-state that claimed to have achieved communism.

KMO: I think that’s an important point that American audiences in particular would find unfamiliar. Here, the Soviet Union is held up as the archetypal example of communism.

Dmytri: Right, but not a single leader of the Soviet Union would ever have claimed to have achieved communism.

KMO: I have been reading your “Telekommunist Manifesto,” and there’s one sentence from early in the manifesto that I think we could probably spend the rest of our time together just unpacking. So, let me read that, I’ll even read it twice, and then I’ll ask that you explain it piece by piece. You wrote, “The Internet started as a network that embodied the relations of peer-to-peer communism. However, it has been reshaped by capitalist finance into an inefficient and unfree client-server topology”.

So, let’s start with just the first part. “The Internet started as a network that embodied the relations of peer to peer communism”. Say more about that.

Dmytri: Well, for many of us in activist circles, in hacker circles in the 90s and some even before (that had access), the Internet didn’t just represent a new technology. It represented something that could have very broad social and political implications, in that, when you use the technology, especially the classic platforms of the Internet, – email, IRC, USENET, and the original classic platforms of the Internet – they didn’t mediate between users. All communication between users was based on mutual configurations. So therefore, if your computer and my computer agreed to exchange information with each other, we could do that without the mediation. Every intermediary node operated under the end-to-end principle, and just allowed us to communicate as if we were talking directly to each other. So this was very much a society of equals.

The “classic Internet” had this kind of ethos of sharing, like we really believed at that time that the Internet was uncensorable. We had this idea because of the topology, and because of the peer-to-peer nature of the communication tools we were using. But of course, what we didn’t fully realize back then, is that this Internet was very tiny. It felt big to us, but it was really very tiny. It was mostly developed by universities, by NGOs, by the military, and other organizations, and the people developing it were developing it for use value, which is an important distinction in economics.

The people who were making things like email, make USENET, like IRC and Finger, were not making them so they could sell them for exchange. They were making them in order to use them. So it really embodied a communist ethic of “from each to each.” The people creating technology wanted to use and share it with everyone that needed it.

But of course, this can’t scale very much, in order for a communication system to be used by the billions of people on the planet, it can’t be entirely made by university students, NGOs and some military contractors. When the Internet became commercialized, it became commercialized by venture capital, and venture capital invests money not for use value but for exchange value. This means that when a venture capitalist provides money, he or she does so under the pretext that they will make more money in return. This is different from a use value Internet. It becomes an exchange value Internet. In order to capture exchange value, the network had to become less free. An internet that allows users to do whatever they want presents very limited opportunities for capitalists to earn profit.

In order to charge prices, communications could be centralized through areas where prices can be charged. And so, there you have the re-architecture of the Internet from what it was back then, based on peer-to-peer software like e-mail, IRC, USENET, Finger, and so forth, to what eventually became called social media, or, briefly, Web 2.0, which is where web applications were developed to mimic the kinds of interactions people were having on the real peer-topeer social media platforms of the early Internet, but in a client-server fashion reminiscent of the original capitalist online platforms like CompuServe, and the original AOL, where all users connected through a central point. Platforms like Facebook, Twitter, and other sorts of things used this same model, and by doing so, they were able to make a profit model based on the capture of user data and control of user interaction.

KMO: This will be a little bit of an aside, but just for my own personal curiosity, when I first started using the Internet, I was a graduate student at the University of Missouri in the early 1990s, and I used IRC, email and USENET, and I also got into listserv discussion groups, but I’m not familiar with Finger, what is Finger?

Dmytri: Finger is like status updates, you have a text file in your home directory, two text files actually, .project and .plan, and you could put your status updates in there, like you might do on Twitter now and then people could check what you are doing.

KMO: Hm, I wonder how I missed it?

Dmytri: You probably had one. People could Finger you.

KMO: Would you say what you mean when you describe the current state of the Internet as being, “an unfree, client-server topology”?

Dmytri: Yes. That is because the current state of the Internet is based on big, centralized services like Facebook, but that’s not all that’s possible. You can still use Finger on the modern Internet as long as you still have TCP/IP to the house, which is, of course, not guaranteed. For one of Telekommunisten’s artworks in 2010 we made a clone of Twitter. It was a microblog based on Finger to show that these ideas have been around since the beginning of the Internet and that the kinds of things being made by modern social media platforms aren’t new in the sense of what kind of use of media they are proposing. The only thing that’s new about them is how they want to capture profits. Finger has existed since the 70s in a distributed fashion that nobody could make a profit on because nobody could control it. Twitter is, of course, very central. It requires millions and millions of dollars in funding. Because it can capture lots of data it can make a business model around monetizing that data and selling it to advertisers and other parties.

KMO: And later in your manifesto, you wrote, “No social order, no matter how entrenched and ruthlessly imposed, can resist transformation when new ways of producing and sharing emerge”.

Dmytri: Right.

KMO: And yet, new ways of producing and sharing did emerge with the early Internet, tools which you described as being very peer-to-peer and communist in structure. And yet it was resisted. That transformation was seemingly hijacked and redirected toward things that are very favorable to the preservation of inequality, a class system and commoditized art, and all the distasteful aspects of the modern Internet.

Dmytri: Well, that’s because, as I elaborate more in the section that talks about peer production, Benkler and stuff like that, is that we haven’t actually achieved peer production on any kind of massive level. If you look at what happens with the early Internet and free software, you see that what was going on was not a new mode of production, but just a very unique kind of distribution of an existing form of production at its core. The problem with free software and free networks is that they can’t capture any exchange value as we discussed already. And so because they can’t capture any exchange value, they cannot finance their own material cost of the upkeep of the people that take care of them. The networks and the programmers and the engineers, and all the people that contribute to the development of free software and free networks need sustenance. And that sustenance, then and now, still comes from capitalism. That, I think, is the point. A true mode of production can’t be resisted, but we haven’t actually seen peer production emerge as a real, significant form of production. For that to happen, we have to have material assets in the commons as well as immaterial assets. So long as the composition of the commons is entirely immaterial, they will not be able to sustain its material upkeep.

KMO: Is there any point in trying to request that the state serve the ends of a peer-to-peer society, or is the state completely at odds with that by definition?

Dmytri: There are a number of threads in the overall strategy that I think are necessary. On one hand, we need venture communism, which means independent, federated entrepreneurship along communist principles. But on the other hand, the state does exist, and I believe that we can’t just imagine that we live in a future state-less society. We have to understand what the state provides now, and we have to struggle within the state as a theater of struggle as well, to get what we can out of it. So I would say yes, but that it really depends on where you are.

In principle, if you look at public funding for other kinds of media, like film, television, and movies, in many cases there’s been quite significant public involvement in the development of those media. So, do I think that there is the prospect for public involvement in funding of social media for a positive impact? Certainly, but, in an era where we’re still not out of the neoliberal phase of history, in an era where governments don’t even want to pay for schools and housing and education and roads, the idea that they will suddenly become interested in paying for social media seems unlikely. So, it doesn’t seem to be a prospect that I have a lot of confidence will actually come about, though it could come about, and if it did, it could be positive. Perhaps, especially in areas that are trying to assert their independence from global neoliberalism, like South and Central America for instance, perhaps they will understand the public need to finance social media in the same way that they finance their broadcast media and their film media.

KMO: Just last night, I was reading an essay by David Byrne, of the Talking Heads, about Spotify, streaming music, and the emerging situation in which all the money changing hands for streaming music is basically going to record labels. Not only are they selling the songs of their artists to the streaming services, but they are also in exchange, for the listing the music companies catalogs, they are getting a stake in services like Spotify, but that artists get very little, even though it is the creativity and passion of the artists whih create value of the end users. The contribution of the artists is absolutely vital and integral, but they get very little of the proceeds.

For example, this past summer, Daft Punk had a song that was so popular that even people who don’t pay follow the music business or make any effort to seek out new music would recognize it – “Get Lucky” is the song – and their Spotify revenues for this, which had been downloaded or streamed hundreds of millions of times, was $13,000 each. They are the megastars of streaming media right now, and the amount of money that they received was less than one would make flipping burgers at McDonald’s. And so, we’ve got this emerging structure where the assumption is that the artists themselves are expected to work a day job somewhere, and then, in their spare time, struggle and produce art which enriches corporations. I’m just wondering what way forward you can envision, and what’s actually worth the time and effort trying to bring it about, because I’m largely of the opinion that trying to request that corporations and governments stop their current collusion and help artists is probably a silly way to invest one’s energy, and I’m wondering about a viable way forward.

Dmytri: I think, in most places, I would agree. Though, as I said, I think in some places it’s more viable than others, but here in the Western world, I think that it wouldn’t be the best use of energy. You had John McChesney on the program, and I’m sure that my view is not so different than his.

The answer, as it’s always been, has been the organization of workers towards ownership of the means of production. It’s no surprise to me that artists are being squeezed out of the profits made by Spotify and other online streaming corporations, because, you understand that artists are paid for their labor value, not the value of what they produce. The value of what is produced is captured by the people that own the means of production and distribution. They are the ones who are going to capture the value, so, unless artists own their own means of distribution and production, they can’t hope to capture the value that is so produced. So the only real way forward is to have not Spotify and iTunes, but organizations made up of the people who actually make the music involved in the production and distribution of media, and to have those owned by the workers themselves.

KMO: I understand that, but I find it an unsatisfying answer. (laughter)

Dmytri: Yeah, I know, it’s the same answer we’ve had for a couple of hundred years.

KMO: Yeah…

Dmytri: It’s not a sexy new answer, but, unfortunately the basic economics makes it so.

KMO: Well, the very central point of McChesney’s message is that we are approaching or perhaps in the midst of what he calls a “critical juncture,” which is a convergence of crises in which a disruptive new technology, a legitimacy crisis around current institutions and economic turmoil all come together. When that happens, we get a moment where there is a possibility to make institutional changes which are sweeping and long-lasting, and it seems that our side, so to speak, is not as focused on capturing the opportunity of that moment, that critical juncture, as the capitalists are. They seem quite poised to take advantage whenever these opportunities open up.

Dmytri: Of course. And, you know, that’s very difficult to combat, because they have the accumulated wealth to be able to weather the storms. So, in a way, crisis serves a role in capitalism as well. It allows the stronger capitalists to squeeze out the weaker capitalists, because capitalism is competition even among the capitalists. The capitalists aren’t only struggling against us, but also struggling against each other.

KMO: And so, it’s no good to try to become a sort of minor, beneficent capitalist, because the larger and sociopathic capitalists will just outcompete you and reduce you back to the worker who is paid not for the value of what he creates before his time, basically.

Dmytri: Absolutely, that’s right. And I think it’s important to understand that capitalism is not a choice for capitalists either, because if you’re capitalist and you invest your capital in such a way that it fails to create more capital, you cease to be a capitalist, right? So, capitalists are just as much trapped within the capitalist system as everybody else.

KMO: But it’s a much more well-appointed cage that they inhabit than most everybody else inhabits (laughter).

Dmytri: Certainly, but it’s not that even if any individual or bunch of individual capitalists suddenly had an epiphany and decided to abandon their exploitive ways, that that would be a threat to the system itself. That would only be the opportunity for other capitalists to squeeze them out.

KMO: Although it seems that the capitalists who had this emerging sense of consciousness and esprit de corps and identification with people and other classes of society, if they had this awakening moment, but they also realized what will happen if they act on it overtly, they might, if they were clever (and they must be clever to be where they are), continue to use the language which pacifies the other capitalists, while working subtly and behind the scenes to implement improvements and some movement toward social justice.

Dmytri: I don’t think language actually has much to do with it. I think the only people that are queasy about radical language are people who position themselves on the left, because they feel that being portrayed as a radical will weaken their position. I think that the people in power are not particularly concerned with language, and you can see that very often if you look at media campaigns. We’ve seen all kinds of revolutionary language, and even revolutionary figures from historical events used in advertising, used to promote and describe capitalist products. So, of course the film industry uses these themes and figures quite liberally, and it’s funded by capitalists.

I don’t think that the capitalist has to make a semantic argument to his peers, I think they have to be successful. I think, in the end, they have to capture profit. And it doesn’t matter how they capture the profit. If they do capture it, they become successful. And that’s also very interesting.

I don’t know if you’ve read any of the work that I’ve done on macroeconomics, which is much more recent than the manifesto. It still consists of just random blog articles rather than a more substantial text, but there are a couple of ideas that I’m fleshing out, and they don’t have names as catchy as “venture communism,” but I think that they’re interesting ideas. The great Polish economist, Michał Kalecki, created an equation to separate profit and consumption by class, which is to say, by workers profit and by capitalist profit. This equation allows you to see the relationship between capital and labor within the profit model. Using Kalecki’s equation as inspiration, I tried to take an approach where I look at modes.

One major problem that I have with a lot of progressive theories that you hear casually within the anarchist community and the communist community is this idea that communism is something that happens in the future, that it suddenly happens as an epiphany, where societies are transformed magically from the old society to the new society, and everything is completely different. I don’t think that this is the case. I think we have communism right now, as well as capitalism right now. If you look at the kinds of relationships we have in our day-to-day lives, we have relationships that are ruled or dominated by exchange value, but we also have relationships that approach the communist relationships of “from each according to his ability, to each according to his need.” “From each, to each”, as I like to summarize it. And we experience these relationships among our friends, within our families, within intentional communities, and also within some of the emerging peer-production forms, like free software and information sharing, and things like that.

What we have is multimodal environment, and I think we need to look at the economy as having multiple modes of production happening at all given times. I don’t think it should be our objective to try to figure out how we can flip from one to the other, but how we can increase the kinds of producing and sharing that we think are beneficial and want more of and decrease the amount of producing and sharing that happens at ways that we think are destructive and not beneficial, and that we want less of. We need value to flow from one mode to another, this is what I’m thinking of, inter-modal value flows.

One kind of these flows is something that I’m calling “substantiation”, which I’ve already been told is a horrible term. The idea of “substantiation” is that there are certain forms of investment that benefit individual members of a class, while hurting the class as a whole.

One example of substantiation is workers supporting capitalists when they buy capitalist securities in their pension funds. Individual workers that buy the securities could very well benefit, but the class doesn’t, because, overall, it cedes more power to capital. The capitalists take that investment and use it to expand capitalist control of the means of production and their own political strength. So, even though funds may benefit the individual workers who invested in them, they hurt workers as a class.

Now, I think that we can also find examples of things that are going the other way. I think free software for instance is a good example of that. If you are capitalist whose business depends on software as an input — in other words, you don’t sell software but you need software in order to produce whatever it is you produce — and you capture your profit elsewhere in the circulation of that final product, so capital is an input to your production, you therefore invest in free software, and by doing so you may yourself benefit, because you get help from the community and cheaper and better software to use in your own production. But, the capitalist class loses, because the sale of software licenses is broadly damaged, is lost as a way to make profit for the capitalist class. So, even though in both cases the individual members of the class are benefiting, this kind of value flow hurts the class in general. These are just a couple of examples of the kind of thinking we need to develop further. We need to figure out how value flows between the different modes that are existing at the same time within the contemporary economy, and what kinds of methods and institutions and practices can we introduce and promote that will cause value to flow from exploitive means to liberating means.

KMO: I think I follow you, but would you summarize your last line of reasoning?

Dmytri: I think that it’s helpful to think of the society that we live in as not being either capitalist or communist, in essence, that it’s helpful to think that within our society we have many modes of production going on at the same time. We have capitalism. We have communism. We have all kinds of hybrid and alternative forms going on. But we have a lot of different kinds of social relations. So, what we need to do is think about that in a compositional way. We need to think about what kinds of ways of producing and sharing are already going on right now, that we could develop more broadly, and how can we move and make value flow from the more exploitive modes to the more liberating modes.

This is what I was trying to get at with the idea of substantiation. These modes are coexisting and drawing off each other, and so just as much as we are benefiting the capitalists with our production, because everything that happens within commons-based production right now as being captured by capital, because the commons is still largely an immaterial commons. But likewise, by contributing to that immaterial commons, the capitalists are also helping us. So, value is flowing. We need to think strategically and ask how can we reduce the loss and maximize the gain. We need to conceptualize how to structure the kinds of productive forms which enable a sustained and positive long-term exchange away from capitalism.

KMO: Well, Dmytri Kleiner, it has been a pleasure talking to you, I look forward to future conversations, and thank you very much for participating on the C-Realm Podcast.

Dmytri: Very nice talking to you as well.

Produced by Guerrilla Translation under a Peer Production License.

– Transcribed by Ann Marie Utratel