Part III: How to get from digital industrialism to digital distributism
In the 1990s, with the advent of digital technology, many of us believed the monopoly industrial system would finally be supplanted. Just as we could compute at home and make our own media, many of us believed we would be empowered to create our own value, or even our own money. The network was to decentralize everything, erode central authority, and make monopoly control of human value exchange impossible.
But really what happened was that we doubled down on industrialism. Instead of getting a highly distributed digital economy characterized by renewed localism or a hands-on ethos, we got what I have been calling “digital industrialism.”
In essence, we went ‘meta’ on the industrial economy. We moved from the linear growth required of industrial stocks, to the exponential growth expected of derivatives and meta-derivatives. Rather than being a merchant or retail monopoly, you become a platform monopoly like Amazon or Uber.
The same anything digital, under digital industrialism, everything becomes represented by a symbol. Just as a song, in a digital landscape, becomes an mp3, everything in a digital economy must be rendered as a quantized symbol. That’s what allows for the exponentialism accelerating formerly linear markets.
Land became territory, territory became property, property became mortgages, mortgages became mortgage derivatives, mortgage derivatives became mortgage derivative futures, which in turn became credit default swaps. None of this exponential layering would have been possible without digital representation.
Likewise, a company becomes stock, and stock becomes derivatives — all because traders in a digital environment want to compress time and achieve impossible exponential gains. They don’t want to wait three months to see the gain; they want the gain now. And so on. And because these derivatives and derivatives of derivatives are so much more leveraged, they are capable of providing much greater returns. The derivatives market is bigger than the stock…