The Source Code of Capital

Why we have to look for the laws of capital to solve our problems with Facebook, amazon, and for creating ecological sustainable economies

In 1999 the Harvard professor Lawrence Lessig claimed the term “code is law”. In his book Code and Other laws of Cyberspace he explored the way in which software code can be used as an instrument for social control. Today we see Silicon Valley pioneers like Jaron Lanier giving us 10 reasons why we should delete our social media accounts .

The development is more than clear to see: what Lessig started to warn us, just happened over the past decade. Even the people from the very inside like the former Facebook executive Chamath Palihapitiya got alerted by the harm that their technologies started to do to societies – worldwide. The power of social control was now used for behavioral manipulation, triggered already existing anger for raising social media activities. The power of codes is used today for surveillance, voters targeting, gaining a massive amount of data for some big players who are now far ahead in developing the next generation of artificially intelligent machines. The forces behind these developments are massively.

But while people like Lessig, Lanier and Palihapitiya still believe that “we as the people” can create a turn around to the better by changing our individual behavior (Lanier), by creating the right legal frame (Lessig) or by investing into technologies aiming for the good (Palihapitiya). I will argue that behind the code which is attacking societies today is another force. A force much older and more and more entangled with technology. It is the investor´s money.

The 1% decide which technologies we have

During the occupy movement starting in 2011 as an aftermath of the financial crisis in 2008 the people claimed the term “We are the 99%”. Organizations like Oxfam report this statistics until today: 1% of the global population owning more or less than 60-80% of the global wealth and capital. Close to these numbers also the German insurance company Alliance says in its wealth report from 2017: “The results showed that the richest 10% together own 79% of net financial assets, while less than 1% is left for the lower half of the population.”

For sure this wealth is not only stored in cash under the pillows of the superrich – there are treasurers and investors taking care of it. Under the nice title of the so called Wealth Defense Industry we find law firms, tax firms, accountants, investment banks, hedge funds, private equity organizations like Bain Capital, venture capitalists, family offices, banks, insurances and many more. They all create their very own strategies and approaches for the main goal: how to avoid losing money and how to create more out of it.

In the past decades one of the biggest money creators was and still is the tech industry. It needed a massive amount of capital being invested into research and development, into seed and growing phases. Behind every problem we see and have to today with “code” there were some investors before who invested into exactly this business model. I would even go further and say that there is a good chance that the “laws of capital” where baked into the “law of codes” which is crawling now deeper and deeper into the social structure of societies. But before we enter the next stage and look closer to the laws of capital being at the core of code, I want to some up this passage once more:

Digitization of society is pushed forward by the people owning the global capital (the 1%) and their administrators/investors. Until today the digitization of society is a totally undemocratic process mainly adjusted to the needs of capital and markets. There is no chance to re-adjust the technological developments to societal needs until the financial funding of these technologies is put under other criteria then it did happen before.

The laws of capital

At this point quite often the argument arises that there are already movements like impact investment or social investment on their way. I am only afraid that additional social or ecological criteria are missing the point of the “laws of capital”. Capital and its basis money might work on a very deep level already against other moral values than profit making.

The value bases or laws of the billions of Dollars, Euros and Renminbi can also been seen as rooted in the five harmful characteristics of our monetary financial system which I found in the work of Bernard Lietaer, Christian Arnsperger, Sally Goerner and Stefan Brunnhuber: Money and sustainability .

In the following summary I will give you those five characteristics and how they are already baked into the technology we use today (pointed out with arrows):

1) The pro-cyclical character of money and capital movement creation enhances the upturn (bubbles) and the downturn (bursts) of the economic cycle

–> No resiliency in the technological system, high dependencies on massive investments

–> Needs fiction and stories for growth – disconnection from ecological environment (nature only works with what is there)

2) The systemic support of short term thinking and acting, because the interest characteristics of the monetary system program rational investors to ignore the future

–> (might) create technologies not caring for the impact to future generations

–> Not considering the long term harm to limited resources, nature and society

3) Obsessive/exponential growth on behalf of compounded interests

–> Favoring massive scaling, global technologies

–> (might) create technological backbone of society which needs massive investments which are needed also in other fields of society (social issues, education…)

4) Concentration of wealth

–> Concentration of technology, tech monopolies (Google, Facebook, amazon, SAP…)

–> No democratic decision or a fair distribution

5) Devaluation of social capital (competition vs. cooperation; psychology of money triggers individualism)

–> Hate speech

–> Opinion bubbles


If you look at these characteristics you see that short term thinking, exponential growth and the devaluation of social capital is at the core of how capital and our monetary system works. It is nothing you can fix just by “better investing” or by investing “more impactful”. The disastrous impact of our monetary and financial system to what is financed and its impact to society and nature is happening by design.

The unsustainable monetary system

By looking at the “code of capital” we can also see why the Sustainable Development Goals will fail like we do it with our climate goals. None of the 17 goals deals with changes of our monetary and financial system which is at the core of all the other goals.

·        How can you go for gender equality if our economical system goes straight for competition and the devaluation of social capital?

·        What kind of decent work and economic growth do you expect if we run on obsessive, exponential growth by compound interests dynamics favoring massive scaling?

·        What kind of quality do you expect in education if it is more and more seen as an economical resource for global competition?

·        How will you reduce inequalities if the concentration of wealth is rising higher and higher

At the core of our problems with technology and with our global sustainability challenges lays or monetary and financial system. This is where we should put all our efforts into to create a change. It will challenge existing power structures. It will challenge the wealth defense industry. It will challenging our thinking and power of imagination.

Maybe it is already too late. Maybe it is even impossible, like trying to get the milk out of the coffee again. But as long as we do not go this deep, as long as we do not try to go for a very deep understanding of the causes of our global problems we will continue to work on the symptoms. We will complain over data grabbing, we will complain over the dangers of artificial intelligence, we will complain over the 1% creating the daily world the other 99% have to live in.

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