by Jo Confino
07 November 2014
is headed for
collapse says Jeremy Rifkin.
Political adviser and
author Jeremy Rifkin
believes that the creation of a
heralds new economic system
that could solve society's
This was the exact
prediction of technocrats in the 1930s, during the
worst of the Great Depression.
Today, capitalism is
taking another dive that could easily exceed the
Great Depression, and hence, the calls already for
the replacement to be wheeled in on a shiny new
Rifkin is no stranger to
In his book,
The End of Work,
Rifkin mentioned Technocracy in several chapters and
included several references to it in the
What possible "new
economic system" might arise out of the ashes of
capitalism? Technocracy!, which is exactly what I
concluded in my book, 'Technocracy Rising: The
Trojan Horse of Global Transformation.'
At the very moment of its ultimate
triumph, capitalism will experience the most exquisite of deaths.
This is the belief of political adviser and author Jeremy Rifkin,
who argues the current economic system has become so successful at
lowering the costs of production that it has created the very
conditions for the destruction of the traditional vertically
Rifkin, who has advised the European Commission, the European
Parliament and heads of state, including German chancellor Angela
No one in their wildest imagination,
including economists and business people, ever imagined the
possibility of a technology revolution so extreme in its
productivity that it could actually reduce marginal costs to
near zero, making products nearly free, abundant and absolutely
no longer subject to market forces.
With many manufacturing companies
surviving only on razor thin margins, they will buckle under
competition from small operators with virtually no fixed costs.
"We are seeing the final triumph of
capitalism followed by its exit off the world stage and the
entrance of the collaborative commons," Rifkin predicts.
of the collaborative commons
From the ashes of the current economic system, he believes,
will emerge a radical new model powered by the extraordinary pace of
innovation in energy, communication and transport.
"This is the first new economic
system since the advent of capitalism and socialism in the early
19th century so it's a remarkable historical
event and it's going to transform our way of life fundamentally
over the coming years," Rifkin says.
"It already is; we just haven't
Some sectors, such as music and media,
have already been disrupted as a result of the internet's ability to
let individuals and small groups compete with the major established
Meanwhile, the mainstreaming of 3D
printing and tech advances in logistics - such as the installation
of billions of intelligent sensors across supply chains - means this
phenomenon is now spreading from the virtual to the physical world,
The creation of a new economic system, Rifkin argues, will
help alleviate key sustainability challenges, such as climate change
and resource scarcity, and take pressure off the natural world.
That's because it will need only a
minimum amount of energy, materials, labour and capital.
He says few people are aware of the scale of danger the human race
is facing, particularly the growing levels of precipitation in the
atmosphere, which is leading to extreme weather.
"Ecosystems can't catch up with the
shift in the planet's water cycle and we're in the sixth
extinction pattern," he warns.
"We could lose 70% of our species by the end of this century and
may be imperiling our ability to survive on this planet."
communication, energy and transport
Every economy in history has relied for its success on the three
...but what Rifkin says makes this age
unique is that we are seeing them converge to create a super
Abandoned Automobile Factory in
While the radical changes in communication are already well known,
he claims a revolution in transport is just around the corner.
"You'll have near zero marginal cost
electricity with the probability of printed out cars within 10
or 15 years," he says.
"Add to this GPS guidance and
driverless vehicles and you will see the marginal costs of
transport on this automated logistics internet falling pretty
Rifkin is particularly interested in the
upheaval currently rippling through the energy sector and points to
the millions of small and medium sized enterprises, homeowners and
neighborhoods already producing their own green electricity.
The momentum will only gather pace as the price of renewable
Rifkin predicts the cost of harvesting
energy will one day be as cheap as buying a phone:
You can create your own green
electricity and then go up on the emerging energy internet and
program your apps to share your surpluses across that energy
internet. You can also use all the big data across that value
chain to see how the energy is flowing.
That's not theoretical. It's just
He says the
German energy company E.ON has
already recognized that the traditional centralized energy company
model is going to disappear and is following his advice to move
towards becoming a service provider, finding value by helping
others manage their energy flows.
He urges large companies across all sectors to follow suit and,
rather than resist change, use their impressive scale and
organizational capabilities to help aggregate emerging networks.
neutrality - key to success
While Rifkin believes the economic revolution is likely to be
unstoppable, he warns that it could be distorted if individual
countries and corporations succeed in their intensifying battle for
If the old industries can monopolize
the pipes, the structure, and destroy network neutrality, then
you have global monopolies and Big Brother for sure.
But if we are able to maintain network neutrality, it would mean
that any consumer who turns prosumer, with their mobile
and their apps, already can begin to feed into this expanded
internet of things that's developing.
People think this is off on the horizon but if I had said in
1989, before the web came, that 25 years later we'd have
democratized communication and 40% of the human race would be
sending information goods of all kinds to each other, they'd
have said that couldn't happen.
The paradox of
Isn't Rifkin concerned that the ability to produce goods so cheaply
will just lead to more strain on the planet's limited resources as a
growing global population go on a buying frenzy?
He believes there is
a paradox operating here, which is
that over consumption results from our fear of scarcity, so will go
away when we know we can have what we want.
Millennials are already seeing
through the false notion that the more we accumulate, the more we
are autonomous and free.
It seems they are more interested in
developing networks and joining the sharing economy than in
consumption for consumption's sake.
sector to become preeminent
What about the concern that the end of capitalism would lead to
Rifkin believes the gap left by the
disappearance of major corporations will be filled by the nonprofit
For anyone who doubts this, Rifkin points to the hundreds of
millions of people who are already involved in a vast network of
co-operatives around the world:
There's an institution in our life that we all rely on every day
that provides all sorts of goods and services that have nothing to
do with profit or government entitlement and without it we couldn't
live and that's the social commons.
There's millions of organizations that
ministering to the poor
...and it goes on and on.
This isn't considered by economists because it creates social
capital which is essential to all three of the internets, but
doesn't create market capital. But as a revenue producer, it's huge
and what's interesting is it's growing faster than the GDP in the
private market system.
At the age of 69, Rifkin admits he may not live long enough to see
his hope for a better future materialize, but says the collaborative
commons offers the only viable way forward to deal with the
sustainability challenges faced by humanity.
"We've got a new potential platform
to get us to where we need to go", he says.
"I don't know if it's in time, but
if there's an alternative plan I have no idea what it could be.
What I do know is that staying with a vertically integrated
system - based on large corporations with fossil fuels, nuclear
power and centralized telecommunications, alongside growing
unemployment, a narrowing of GDP and technologies that are
moribund - is not the answer."