I spent the weekend mulling over Mike Edwards‘ essay Philanthrocapitalism: After the gold rush. The basic argument is this: there is a movement afoot to harness the power of business for social change. This includes newly-minted foundations like Gates, corporate social responsibility programs and social entrepreneurs. These philanthrocapitalists are undermining the independence and social mission of civil society. As a result, we are missing out on real social transformation, and maybe even risking our democracy.

From where I sit, much of what Edwards says seems wrong or misdirected, mixing apples with oranges with assumptions. Which is why I was so surprised to see him briefly trumpeting one of my
favourite ideas: “… new business models built around the commons, such as open source software.” Edwards suggests that these new models have the potential to deliver deep changes to both our society and our economy. I agree. In fact, I would argue that they already have.

The power of peers

Just think about Wikipedia for a second. In less than 10 years, Wikipedia has completely overturned the intellectual and economic power structure of the publishing industry (or, at least, the parts dealing with reference materials). What’s more, it has dramatically increased the number of languages that have their own encyclopedias (over 250), the number of topics covered (2.3 million in English alone) and the speed with which new topics get covered (there is even a little article on philanthrocapitalism). Like it or not, Wikipedia is unquestionably an incredible achievement.

Many would also argue that Wikipedia is a major public good, on the order of an education or library system. That’s certainly what Jimmy Wales and others had in mind when the coined the Wikimedia Foundation’s vision statement: “Imagine a world in which every single human being can freely share in
the sum of all knowledge. That’s our commitment.” The people behind Wikipedia were definitely thinking about what Edwards calls ‘real social transformation’ right from day one.

Of course, the most interesting thing about Wikipedia is not Wikipedia itself, but the method used to create and maintain it. Tens of thousands of volunteers around the world contribute and edit content on topics they are passionate about. When you add up all of these small bits of labour, you have what it takes to create the world’s most comprehensive
encyclopedia.

It’s this kind peer production that Edwards is talking about when he speaks of ‘the commons’. And, as Yochai Benkler eloquently argues in The Wealth of Networks,
this model is not limited to Wikipedia: it is a part of a new and
growing wave of non-market peer production that is creating tremendous
public assets. Linux. Mozilla Firefox. The Public Library of Science. MIT’s OpenCourseWare. The 60 million Creative Commons-licensed photos
on Flickr. We create and hold these things in common. And, as we hold
them, our economies, our societies and our democracies are
transforming.

The yin yang dance

The funny thing is,
Edwards seems to think that the commons and business are at odds. “The
problem is that these approaches are absent from the philanthrocapitalist menu,” he says. The facts say otherwise. Who are
the top funders of of Wikipedia? Sun Microsystems co-founder Vinod Khosla and Richard Branson’s Virgin Unite. Who funds the Creative Commons?
Sun, Microsoft, Cisco, IBM, Yahoo, Facebook as well as a number of
foundations created with newly minted high tech wealth. The commons is
clearly on the philanthrocapitalist menu.

More importantly:
collaborative, non-market peer production was born from a world that
lives on the fuzzy edge between public and private benefit. In his 1999
essay, the Magic Cauldron, Eric Raymond
offered a taxonomy of open source business models that still left the
code in the commons: cost-sharing; giving away things that have use
value but no sale value; selling technical support or services. His
point was this: business and the commons are not only compatible but,
in many cases, actually interdependent.

In the almost 10 years
since the Magic Cauldron, we’ve seen real world success by open source
projects mixing public and private benefit. Committed to bringing books to the blind, entrepreneur Jim Fruchterman generates revenue from online services while staying staunchly not-for-profit. Once a single foundation, Mozilla is now a foundation and two companies
as a way to consciously play across the private / public benefit divide.
And, intent on transforming the economics of software with an always
free, easy to use version of Linux, Mark Shuttleworth set up not a charity but a business.
In stark contrast to Edwards, these folks do not see public and private
benefit in a zero sum pitched battle: they see a yin yang dance. There
may be times of conflict, but it is a conflict of interdependence and,
ultimately, mutual benefit.

Open sourcing philanthropy

At
the end of his essay, Edwards asks what he calls the $55 trillion
question: how will we use the vast amount of new philanthropic
resources that will be created in the next 50 years? My instincts tell
me that Wikipedia, open source and peer production may hold part of the
answer. The world of the commons has used openness, participation and
community to create real and (hopefully) lasting public goods. Why not
apply these same principles to improving education, creating low cost housing or evolving our democracy?

Of
course, using open source principles to address a wide variety of
social needs would require a new kind of foundation. In fact, it would
require a whole wave of foundations built from the ground up around the
values of openness, transparency and participation, and sitting happily on the fuzzy
edges between public and private benefit. It would require us to open source philanthropy. Possible? I think so. And, who knows, maybe some of the so-called philanthrocapitalists might even be willing to help.

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An edited version of this post is part of a debate about philanthrocapitalism taking place on OpenDemocracy.net. It’s also highlighted on Slashdot.