The financial sector is a notoriously opaque, alienating and destructive complex. Not only is it implicated in social injustice and ecological carnage around the world, it also wields huge political power. This is why I am setting up The London School of Financial Arts (LSFA), a hackspace for finance-focussed activism and for creative projects that challenge economic power structures.
‘Hackspace’ is a term derived from hacker culture, referring to a place where people can tinker on projects and use communal resources and facilities. Normally they host physical hardware, computers and electronics equipment, but the concept can be adapted well to an economic justice setting. Imagine a space with maps of global financial flows, libraries holding communal books, and rooms to design campaigns in. LSFA will be a place to explore the nature of money, host workshops and build installation art, films and even phone apps that explore the financial system.
The dark side of the financial sector
In 2013 I published The Heretic’s Guide to Global Finance: Hacking the Future of Money. In it, I sketch out a several problems in our current global financial system.
Firstly, the financial sector steers money into industries that are hardwired to breach planetary ecological boundaries. Secondly, it creates inequality. Not only do financial professionals reap outlandishly large salaries, but financial instruments are conduits for powerful investors to direct money into powerful institutions, often in ways that do not benefit many ordinary people.
Thirdly, it exhibits high levels of complexity and opacity that, when combined with the fact that the system is highly interconnected, creates systemic risk and the ability for financial crashes in one country to shake the entire global economy.
Fourthly, it hosts the culture of finance. This tends to be portrayed in the press by pictures of traders swilling champagne at strip clubs. The deeper issue, though, is the entrenched desire of financial professionals to imagine their profession as an apolitical agent of economic efficiency, rather than accepting the intensely political nature of facilitating investment processes around the world.
Finally, there is the process we call financialisation, that creeping sense that the culture and drives of the financial sector are taking over many aspects of life previously untouched by it. It turns everything into investable and tradable ‘assets,’ from land, to food, to atmospheric pollution rights.
In my book I chose to apply hacker philosophy to the financial system. Finance, much like technology, often repels people through its apparent complexity. The way that technology hackers approach a complex, interconnected technology system is thus a useful model for thinking about how to approach a complex, interconnected financial system, too.
The act of technology hacking initially involves exploring a piece of technology that opens up the ability to jam its workings, as well as to build your own version of it. Using that as an analogy, financial hacking involves exploration of the financial system that opens up the ability to design campaigns that jam its workings, and also allows us to start building our own DIY versions of the system.
The term ‘hacker’ has a subversive appeal that can capture the imagination of both activists and entrepreneurs. Indeed, it’s a useful archetype to use when trying to engage the entrepreneurial imagination of activists who need to build economic alternatives, whilst simultaneously engaging the activist imagination of entrepreneurs who need to be more critical when designing and building new things.
True hacking fuses together notions of creativity with rebellion. A hack is like the act of kicking down a door to make a table. It is not merely rebellion (kicking down a door), or merely creativity (making a table). It’s the art of blending the two into a seamless act of creative rebellion or rebellious creativity.
The politics of labelling
However, the term ‘hacking’ comes with a certain amount of political baggage that needs to be addressed.
In the way I describe it above, hacking refers to an ethic or an impulse, rather than any specific class of action. ‘Hacker’ is not really something you can put on a business card like ‘plumber’ or ‘accountant’. It has a similar dynamic to terms like ‘mystic’, ‘leader’ or ‘innovator’: I may have mystical tendencies, or leadership skills, but as soon as I concretise those and explicitly call myself a mystic or a leader, I have missed the point in some way. They are not concrete roles, they are loose sets of characteristics.
One of the confusions, though, comes from the fact that there is one version of the word ‘hacker’ that refers not to an ethic, but to someone with the very specific vocation of breaching computer security systems. This is the definition obsessed about in sensationalist terms in the mainstream press, and it comes laden with criminal connotations, such as ‘Hackers steal credit card data’.
This has turned the figure of the hacker into something of a bogeyman in the eyes of many people—especially in my parent’s generation—who are often on the defensive when it comes to technology anyway. It’s like the term ‘anarchist’, which has been divorced from its rich intellectual history and presented in the conservative press as lawless wildcats throwing Molotov cocktails, evoking fear in the everyday reader.
The gentrification of hacking
In recent years though, the term has come to have a second problematic interpretation. This is the Silicon Valley version, which presents the geeky but successful male coder-entrepreneur as a hacker. As tech start-up culture has become exponentially more powerful, this definition has risen, too.
Rather than carrying a subversive edge, this version of the term gets applied to all manner of generic computer-based innovation undertaken by preppy, Stanford-educated entrepreneurs. With their mainstream success comes a ‘revenge of the nerds’ triumphalism. ‘Hacker’ starts to get worn like a badge by an exclusive club of soon-to-be-wealthy business-focused masters of tech.
This in turn has given the term more legitimacy in innovation scenes in general. The gentrified version is even seeping into public sector parlance and NGOs, where ‘hackathons’ are held and computer language like ‘beta testing’ and ‘2.0’ are applied to all sorts of activities.
The true cores of hacking though, do not resemble either the criminal interpretation, or the Silicon Valley interpretation. To seek the soul of hacking, we need to go deeper into the underlying dynamics.
Exploration: The de-alienation impulse
The basic foundation of hacking is the exploration impulse, the desire to explore and understand things that most people in society are not encouraged to explore or understand. It is a drive to de-alienate a world that appears confusing and unwelcoming. For example, urban exploration, or ‘urbex’, crews explore derelict buildings, infrastructure and underground train lines. Hardware hackers explore the internal moving parts of machines, computer hackers explore lines of code.
This adventuring is underpinned by a rebellious curiosity. Applying this mentality to the financial sector is useful, because many people are told that finance is only for experts, not something for ordinary people to either understand or be curious about. The perception that finance is ‘too complicated to understand’ serves to create a layer of protection for the financial sector, much like the perception that computers are too hard to understand forms a layer of protection for Microsoft.
The desire to challenge those perceptions and explore, though, can sometimes veer into what is defined as ‘illegal’. That’s because exploring beyond set barriers can involve breaching boundaries encoded in law, especially when powerful institutions have a hand in setting such laws. There’s also a natural tendency towards deviance from social norms built into the hacker ethos.
Rationalism meets romanticism
Exploration has two contrasting dynamics. On the one hand, there is a control element: I want to explore, and analytically understand, everything around me in order to be able to control my world better. I do not want to rely on authorities or corporate marketers to tell me what the world is. In its positive form, we can call this ‘empowerment’.
On the other hand, exploration can have a romantic element, a desire to experience things for the sheer joy of it, or to be able to feel emotionally closer to the world, or to things that don’t normally allow you to experience them emotionally. Hacking can sometimes blend this analytical rationalism with emotional romanticism. In the case of coding, I may seek to intellectually understand code in order to gain empowerment, but perhaps in so doing I learn to let go, lose my defensiveness and emotionally feel the code.
This tension is well exemplified by the controversial ‘homeless hacker’ Adrian Lamo. On the one hand he can come across as a control freak, trying to decode everything around himself in an almost anti-social drive to be completely self-sufficient, doing anything except what is expected of him, including handing in Private Manning to the US authorities. Alternatively, he can come across as a new-age romantic, drifting on Greyhound busses, sleeping in abandoned buildings, casually breaking into Yahoo! from internet cafés, in love with the sheer explorability of the world, trying to appreciate it in its raw, unmediated beauty.
The figure of the hacker thus comes with a certain unpredictability, an unstable identity. This shines through in the hacker ethic of playful do-it-yourself tinkering which, unlike normal hobbyists, is underpinned by a distinct mischievous element—often with a dark twist.
The creativity is not just about building new things, it’s about messing with things, bending rules, recombining elements, and especially, using elements of existing systems in ways they’re not supposed to be used. For example, Richard Stallman’s concept of ‘copyleft’ is considered a classic hack because it takes the rules of copyright and bends them to create a licence that opposes copyright. There is an element of the trickster, like the mythological woodland sprite Puck.
In the realm of finance, such hacks can include the subversive use of shares for shareholder activism, the creation of activist hedge funds— such as Robin Hood Minor Asset Management —and daring artistic projects like Paolo Cirio’s Loophole for All tax haven hack. More generally, the do-it-yourself spirit of hacking can extend into the realm of alternative currencies, peer-to-peer platforms and co-operatives.
The problems of disruption and empowerment
A friend of mine who works in the tech industry recently sent me an email saying, “My philosophy is that creative destruction targeted at unhelpful institutions is the most potent form of activism.” This captures the creative hacker impulse, but it also suggests two key problems in the hacker narrative.
Firstly, it is the very element of messing with established boundaries to create ‘disruption’ that corporate innovation professionals romantise. The hacker impulse can be cast as a force for Schumpeterian change, the force that knocks existing corporations down and replaces them with other corporations.
Indeed, it is quite possible to be playful, curious and mischievous without having any deep drive to rebel. The Ivy League coders who call themselves ‘hackers’ are often only so in a weak sense. They project a watered-down, entrepreneur-centric vision of hacking that casts clever and quirky innovation as a subversive goal in itself, even if the intention may be to sell their ‘hack’ to Yahoo!. Thus, while Mark Zuckerberg perhaps initially resembled a hacker, he now merely represents the hipster business elite, conventional figures in new clothes.
Secondly, note the individualistic notions of change implied in the email message. It’s one thing to disrupt power structures, but the weakness is in showing how this translates into social empowerment more generally. As an individual, hacking offers an exciting narrative—I personally can do something—but struggles to show how my individual empowerment can be extended to others.
The hacker drive for de-alienated self-empowerment throws up tricky issues. As people with a hacker impulse gain confidence, they can become increasingly intolerant towards conventions, but also towards institutions like large welfare systems, which are viewed as being alienating in their own way. When combined with the individualistic streak, this makes for a libertarian political outlook.
At its best, that can be a left-leaning libertarianism concerned with showing bottom-up solidarity with those in less empowered positions, similar to anarchist mutual aid. In its negative incarnation, though, hacker culture can fetishise personal liberty, a conservative ‘don’t tell me what to do’ libertarianism associated with people who already have power and are not interested in widespread social change.
The hybrid economics of open source culture
One powerful social phenomenon to emerge from hacker culture is the open source movement. It started with people working on collective software projects, but as individuals, organised via open mailing lists rather than traditional leadership structures. Open source culture attempts to fuse elements of individualistic hacker ethics with overt public and community goals. It thus has potential to serve as a model for how to overcome the limitations of standalone hacker culture.
The goal of the original open source movement was to build alternatives to copyright-protected corporate software. The idea was to create programmes with open code, available for widespread use under ‘copyleft’ licences. The movement has since expanded into fields beyond software, from Creative Commons music to open source architectural design models. The underlying theme is to disrupt centralised authorities —such as large corporations—but to do so by building useful, usable and accessible alternatives for people.
Despite sometimes being cast as a covert ‘Marxist’ movement from some conservative quarters, the open source community carries lingering elements of conservative libertarian culture, particularly the idea that self-empowered individuals shape the world by voluntarily building stuff and then allowing others to opt in. This dynamic is seen in the Bitcoin community, which operates on open source principles, but which has nevertheless developed a highly unequal demographic of users with unequal levels of access. In other words, Bitcoin arguably replicates elements of existing power structures.
The underlying potential is there though, and the open source framework may be the closest working model we have to an alternative hybrid economic system. It’s definitely not entirely separate from the mainstream—after all, open source participants often have day jobs—but it is building precedents that nevertheless challenge core precepts of mainstream economics: It challenges the idea that people only work for their own gain and not for the public good, and that people demand payment, patents and power.
Building an open source financial hackspace
The open source hacker ethic needs to be extended and augmented though. It’s still too tied up in the politics of the outsider rogue male imagining themselves as a heroic Robin Hood figure. Rather than sticking with that stereotype, hacker culture needs to be balanced with a more warm and feminine spirit, and also needs much more focus on broader social and ecological processes.
This is what The London School of Financial Arts seeks to do, mixing analytical exploration aimed at decoding the financial system, with emotive, mischievous, artistic exploration of economic alternatives. We want it to be a place where underdogs can learn to bark.
Brett Scott is a financial campaigner and author of The Heretic’s Guide to Global Finance: Hacking the Future of Money (Pluto Press, 2013). @Suitpossum
LSFA is at www.lsfa-hackpace.cc