Tim Morgan publishes his first blog post in our Emerging Fellows program by revisiting the concept of ownership. The views expressed are those of the author and not necessarily those of the APF or its other members.
Immediately after the painting “Girl with Balloon” sold at auction for $1.4 million, the painting began slowly destroying itself. A malfunction caused it to stop half-way.
The anonymous artist known only as Banksy had secretly hidden an automated shredder inside the frame. The half-destroyed work is now considered a new piece of art, valued much higher than the original painting. The event is an unlikely but apt metaphor for how automation is redefining ownership.
The Eighteenth Century philosopher Adam Smith described capital as owned property used to produce an economic return. Capitalism’s central feature is that owned things are used to produce exchangeable value, be they a farmer’s vegetables or self-sabotaging paintings. Ownership from a capitalist perspective is control of something used to create enhanced value. In turn, exchanges of ownership are synonymous with exchanges of value. Each side gets something they value more than what they are willing to give in exchange. Centuries of worldwide progress and prosperity rest on ownership as capitalism’s bedrock social organizing principle.
Control determines who can create value from property. Capitalism assumes that control and ownership are inextricably intertwined. Yet Banksy’s auction stunt illustrates how automation is changing the current relationship between ownership and control. Traditionally if you own capital then you also directly or indirectly control it. Banksy subverted that control by using automation to go beyond “I don’t want my art sold” to embedded enforcement of “You can’t sell my art, even if you own it”. Automation enables embedding active governance rules into owned items themselves. Legal scholar Lawrence Lessig describes this as “Code is Law”. Banksy’s embedded painting shredder is analogous to copy protection of digital movies and music files. You own the ability to experience, but not the thing itself.
These embedded automation rules constitute an increasing level of external control over owned things. If ownership equals control, then those who are implementing the automation are increasingly the owners, no matter who holds the receipt. Existing legal frameworks have always considered use as a legal component of ownership, but those institutional frameworks are lagging the breakneck pace of automation. A user can own an AI-enabled smart-speaker appliance like Amazon Echo or Google Home, but those same items become expensive plastic bricks without their backend automated services.
But does this loss of control due to automation extend to productive capital? History shows a progression of ever more abstract relationships between owners and control of productive capital. We went from the concrete control of simple property such as farms and animals, to abstract control via corporate shares and investment funds. Even in the past few decades innovations like millisecond flash-trades and complex financial derivatives make it unclear who owns what at any given time. At each stage the use of capital to create value appears to become more tied to its control than to its ownership.
It is ironic that Banksy’s automated assertion of control over “Girl with Balloon” increased the piece’s value, rather than destroying it as intended. The work has been appropriately renamed “Love Is in the Bin”. The new owner adapted to Banksy’s attempt at automated control. By inadvertently relinquishing a bit of control to unknown automation, the new owner gained more value than they originally purchased.
Love may be in the bin, but for now capital still hangs on the wall.
© Tim Morgan 2019