The Internet’s Unholy Marriage to Capitalism
by John Bellamy Foster and Robert W. McChesney
Monthly Review The United States and the world are now a good two decades into the Internet revolution, or what was once called the information age. The past generation has seen a blizzard of mind-boggling developments in communication, ranging from the World Wide Web and broadband, to ubiquitous cell phones that are quickly becoming high-powered wireless computers in their own right. Firms such as Google, Amazon, Craigslist, and Facebook have become iconic. Immersion in the digital world is now or soon to be a requirement for successful participation in society. The subject for debate is no longer whether the Internet can be regarded as a technological development in the same class as television or the telephone. Increasingly, the debate is turning to whether this is a communication revolution closer to the advent of the printing press.1
The full impact of the Internet revolution will only become apparent in the future, as more technological change is on the horizon that can barely be imagined and hardly anticipated.2 But enough time has transpired, and institutions and practices have been developed, that an assessment of the digital era is possible, as well as a sense of its likely trajectory into the future.
Our analysis in this article will focus on the United States—not only because it is the society that we know best, and the Internet’s point of origin, but also because it is there, we believe, that one most clearly finds the integration of monopoly-finance capital and the Internet, representing the dominant tendency of the global capitalist system. This is not meant to suggest that the current U.S. dominance of the Internet is not open to change, or that other countries may not choose to take other paths—but only that all alternatives in this realm will have to struggle against the trajectory now being set by U.S. capitalism, with its immense global influence and power.
What is striking, as one returns to the late 1980s and early 1990s and reads about the Internet and its future, is that these accounts were almost uniformly optimistic. With all information available to everyone at the speed of light and impervious to censorship, all existing institutions were going to be changed for the better. There was going to be a worldwide two-way flow, or multi-flow, a democratization of communication unthinkable before then. Corporations could no longer bamboozle consumers and crush upstart competitors; governments could no longer operate in secrecy with a kept-press spouting propaganda; students from the poorest and most remote areas would have access to educational resources once restricted to the elite. In short, people would have unprecedented tools and power. For the first time in human history, there would not only be information equality and uninhibited instant communication access between all people everywhere, but there would also be access to a treasure trove of uncensored knowledge that only years earlier would have been unthinkable, even for the world’s most powerful ruler or richest billionaire. Inequality and exploitation were soon to be dealt their mightiest blow.
The Internet, or more broadly, the digital revolution is truly changing the world at multiple levels. But it has also failed to deliver on much of the promise that was once seen as implicit in its technology. If the Internet was expected to provide more competitive markets and accountable businesses, open government, an end to corruption, and decreasing inequality—or, to put it baldly, increased human happiness—it has been a disappointment. To put it another way, if the Internet actually improved the world over the past twenty years as much as its champions once predicted, we dread to think where the world would be if it had never existed.
We do not argue that the initial sense of the Internet’s promise was pure fantasy, although some of it can be attributed to the utopian enthusiasm that major new technologies can engender when they first emerge. (One is reminded of the early-twentieth-century view of the Nobel Prize-winning chemist and philosopher of energetics, Wilhelm Ostwald, who contended that the advent of the “flying machine” was a key part of a universal process that could erase international boundaries associated with nations, languages, and money, “bringing about the brotherhood of man.”3) Instead, we argue that there was—and remains—extraordinary democratic and revolutionary promise in this communication revolution. But technologies do not ride roughshod over history, regardless of their immense powers. They are developed in a social, political, and economic context. And this has strongly conditioned the course and shape of the communication revolution.
This economic context points to the paradox of the Internet as it has developed in a capitalist society. The Internet has been subjected, to a significant extent, to the capital accumulation process, which has a clear logic of its own, inimical to much of the democratic potential of digital communication, and that will be ever more so, going forward. What seemed to be an increasingly open public sphere, removed from the world of commodity exchange, seems to be morphing into a private sphere of increasingly closed, proprietary, even monopolistic markets.
Our argument is not a socialist argument against capitalism’s anti-democratic tendencies per se, which we then extend to the case of the Internet. Although we would not be uncomfortable taking such a position, it would make something as extraordinary and unique as the digital revolution too much a dependent variable—and it would allow those opposed to socialism to dismiss the argument categorically. Instead, we base our argument on elements of conventional economic thought, produced by scholars who, by and large, favor capitalism as a system. Our critique, derived from classical and mainstream terms of analysis, will repeatedly demonstrate the weaknesses of allowing the profit motive to dictate the development of the Internet.
In particular, we argue that applying the “Lauderdale Paradox” (or the contradiction between public wealth and private riches) of classical political economy makes a strong case that the most prudent course for any society is to start from the assumption that the Internet should be fundamentally outside the domain of capital. We hope to provide a necessary alternative way to imagine how best to develop the Internet in contrast to the commodified, privatized world of capital accumulation. This does not mean that there can be no commerce, even extensive commerce, in the digital realm, but merely that the system’s overriding logic—and the starting point for all policy discussions—must be as an institution operated on public interest values, at bare minimum as a public utility.
It is true that in any capitalist society there is going to be strong, even at times overwhelming, pressure to open up areas that can be profitably exploited by capital, regardless of the social costs, or “negative externalities,” as economists put it. After all, capitalists—by definition, given their economic power—exercise inordinate political power. But it is not a given that all areas will be subjected to the market. Indeed, many areas in nature and human existence cannot be so subjected without destroying the fabric of life itself—and large portions of capitalist societies have historically been and remain largely outside of the capital accumulation process. One could think of community, family, religion, education, romance, elections, research, and national defense as partial examples, although capital is pressing to colonize those where it can. Many important political debates in a capitalist society are concerned with determining the areas where the pursuit of profit will be allowed to rule, and where it will not. At their most rational, and most humane, capitalist societies tend to preserve large noncommercial sectors, including areas such as health care and old-age pensions, that might be highly profitable if turned over to commercial interests. At the very least, the more democratic a capitalist society is, the more likely it is for there to be credible public debates on these matters.
However—and this is a point dripping in irony—such a fundamental debate never took place in relation to the Internet. The entire realm of digital communication was developed through government-subsidized-and-directed research and during the postwar decades, primarily through the military and leading research universities. Had the matter been left to the private sector, to the “free market,” the Internet never would have come into existence. The total amount of the federal subsidy of the Internet is impossible to determine with precision.
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