Is Money the Root of all Evil? (READER APPRECIATION DAY)

In which I represent my theory that MONEY IS A FETISH.

Hey Nevermorons,

One of my favourite readers goes by the name of ebear.

I like him for multiple reasons. He combines extreme intelligence with skepticism, erudition and worldliness. He is clearly well-read, but his perspective is unmistakably his own.

From what I’ve pieced together, he’s lived all around the world, and absorbed many different cultural perspectives. Clearly, he is a student of life.

I also like him because he challenges me constantly from ideological positions that I have never encountered IRL.

For instance, he’s been known to defend the much-reviled economic theory of Thomas Malthus. I’ve never met a Malthusian in the wild. Have you?

The reason that I’m writing this is because we recently got into quite an interesting discussion about human nature, morality, and economics.

Ebear likes to challenge me on my anarchism, which he sees as naive.

Ebear:

[G]overnments are composed of people, so it's not the institution of government that's necessarily corrupt but the people who form the government, which is just a subset of people in general. I contend that people are corrupt, or at least corruptible in the sense that they're easily misled and lack a foundation in critical thinking.

Crow:

You reminded me of some lyrics from the immortal Crass's anti-Marxist anthem Bloody Revolutions: "You speak of liberation and when the People rule / Well ain't it people rule right now? What difference would there be?"

And this is indeed the rub. There's no getting away from some people having power, and power does indeed corrupt. Healthy societies have levelling mechanisms to prevent people from getting too drunk on power, but there's no way to avoid some people having more power than others. Humans will have leaders. There is no getting around the leader/follower dynamic... most people are followers.

That said, that leadership does not need to be coercive, and the authority of leaders in egalitarian societies is based on charisma and their ability to create consensus.

Consensus is something that most people don't understand. Consensus doesn't exist until it is created through some kind of political process.

It's quite tricky to separate human nature from culture, but we have zero definitive proof of any state before Sumer. This might change in the future, as we learn more about new archaeological discoveries such as Gobekli Tepi, but for now there's no definitive proof of an institutionalized bureaucracy overseeing tax collection and a standing army, which I consider essential features of any state. That means that for the vast majority (95%+) of our existence as anatomically modern humans, we have lived in stateless societies.

Have you heard The Alphabet Versus the Goddess by any chance? Literacy is definitely correlated with statecraft, which makes sense once you realize that literacy emerged from a class of scribes whose primary responsibilities were overseeing tax collection and the provisioning of armies. So written history is not sufficient to get a grasp on human nature, because that leaves out non-literate societies.

Furthermore, in pre-monetary economies, people presumably stored wealth socially (hence the deep human fixation with status). Money fundamentally changed us. It would be an exaggeration to say that money is the root of all evil... but money is historically highly correlated with brutality.

Money is not an inherent part of human nature... indeed it is a relatively recent invention, and seems to have changed everything. It's funny that the term "social credit" is now associated with totalitarianism, because social credit is the original form of wealth.

Ebear:

Hard to imagine what seizing power in a stone age culture would look like. Herd all the women into a hut and block the entrance menacingly? That would last about 5 minutes.

Early writing was a method of accounting by some accounts. You took your grain to the central silo and received a clay tablet recording the weight or volume. The idea was to have the grain in a secure location, and should famine occur, it could be rationed. The tablets were probably used as circulating money, so basically a bank.

I disagree with the root of all evil thesis. Anything can be used as money - cowrie shells, tobacco, ammunition. All situation dependent. The idea is to have something portable of accepted value so you don't have to barter, which is inconvenient. Taking a cow to the market every day to trade for a plow gets tedious when nobody has plows on offer, or they do but have no use for a cow. Evil enters the picture when you start loan sharking, which is why Jesus went after the money changers. A debt that can't be repaid is the lender's problem, not the borrowers, unless fraud is involved.

Jesus was an early conservative monetary theorist.

CROW:

We are in full agreement there - usury is much more of a problem than money is. But I think that it is important to realize that if we're going to talk about human nature, money needs to be taken into account, as it distorts social relations and inevitably becomes a fetish object.

This is true whether wealth is measured with cowrie shells, gold, quetzal feathers, or crypto-currencies. People end up worshipping the abstraction instead of realizing that money is meant to keep track of who owes who what... money derives its value from social credit.

Arguably, math is the root of all evil. Math takes social relations and concretizes them into talismanic objects that can be traded, stolen, and demanded as tribute. But at the end of the day all forms of money are tradable IOUs. They derive from social obligation, namely the obligation of the individual to the tribe.

No one is debt-free on this plane of existence. If you ask me, Original Sin is better conceived of as Original Debt.

Men MUST toil, women MUST bear children... or society could not continue. None of us reach adulthood without an incalculable debt to our parents... And in traditional societies this debt must be repaid by caring for our parents when they are old.

Social obligation is what gives value to money.

Money was a technological innovation because it allows debt obligations to be quantified and traded to strangers.

Okay, now arguably I'm not doing ebear’s ideas justice, but I’m sure that he will set the record straight in the comments.

Let me summarize my argument here:

1. Money is a relatively recent invention

2. The invention of money was an innovation because it facilitated the trading of debt obligations

3. Debt obligations were originally social and mediated through culture

4. In order to trade debt obligations, they must be quantified and rendered fungible

5. Money is inherently reductive because the process of quantification inherently devalues the qualitative subjective meaning of an object and the matrix of relationships within which its value is determined

6. Money concretizes abstractions through a process of nominalization, by which actions become things

7. Money de-emphasizes the uniqueness of particular things

8. Money is homogenizing

9. Money didn’t exist prior to math

10. Math didn’t exist before literacy

11. Literacy didn’t exist before statecraft

12. Money didn’t exist before states

13. Not all media of exchange are money

14. Money is a Fetish, in the anthropological sense of that term.

Before I go any further, though, I’ve got to get one thing out of the way.

THE MYTH OF BARTER HAS BEEN DEBUNKED

One thing that does need to be said is that ebear is wrong in one significant way. He seems unaware that the Myth of Barter, a mainstay of economics textbooks since the time of Adam Smith, has been disproven.

Anthropologists have known that the myth of barter is a lie for at least a century, but David Graeber gets the credit for disproving it once and for all in his magnum opus Debt: The First Five Thousand Years.

The following video includes a fun illustration of why the myth of barter doesn’t make sense.

The reason that I’m writing this is to broaden the conversation and raise some of the questions posed by Graeber in an earlier work, Toward an Anthropological Theory of Value.

WHAT IS MONEY?

With the rise of crypto-currencies, there has been tremendous interest in “the most important question in the world today”.

IS ELON MUSK A MARXIST?

If you ask me, the most interesting thing that Elon Musk has ever said is:

“Money, in my view, is essentially an information system for labor allocation, so it has no power in and of itself; it's like a database for guiding people as to what they should do.”

Wow. Take some time to chew on that.

Sounds like Musk subscribes to Marx’s labour theory of value, doesn’t it?

WHAT IS VALUE?

According to the Fed, money is a store of value. But what is value?

Graeber points out that three large streams of thought that converge in the term.

These are:

1. “values” in the sociological sense: conceptions of what is ultimately good, proper, or desirable in human life

2. “value” in the economic sense: the degree to which objects are desired, particularly, as measured by how much others are willing to give up to get them

3. “value” in the linguistic sense, which might be most simply glossed as “meaningful difference”

WHAT MAKES SOMETHING VALUABLE?

Ultimately, objects are valuable because they are desired. It’s as simple as that.

This is where things get really interesting, because desire is, to a significant degree, socially constructed through culture.

Our most primal desires stem from physical needs, such as the desire for food, shelter, warmth, love, and sex. Once those are met, human desires become increasingly irrational and culture-specific.

To the Lakota people, for instance, gold was not seen as particularly valuable. When prospectors overran the Black Hills, they came to call gold “the yellow metal that makes the whites crazy”.

Gold does have use value, such as fillings for teeth, but it is mostly valuable because it is a store of value. In other words, it is valuable because it is valued.

In many cases, people want things simply because others want them. In others, they want them because they confer status. Which objects confer status is culturally determined.

This brings us to one of the main points Graeber makes in Toward an Anthropological Theory of Value - that valued items almost inevitably come to be seen as ends in themselves.

NOT ALL MEDIA OF EXCHANGE ARE MONEY

Ebear rightly points out that items such as cowries shells and tobacco were used as media of exchange in stateless societies, but I would argue that not all media of exchange are money.

Money as we generally think of it today has certain characteristics, namely:

• Durability

• Portability

• Divisibility

• Uniformity

• Limited supply

• Acceptability

• Fungibility

Pre-monetary media of exchange had some of these characteristics, but not all of them. If these are essential attributes of money, then one must conclude that money only came to be as a function of statecraft.

IF IT AIN’T FUNGIBLE, IT AIN’T MONEY

Greaber stresses the fungibility of money, stating:

Money does not consist of unique objects at all. At least in principle, it is absolutely generic, any one dollar bill precisely the same as any other.

TOKENS OF VALUE EXISTED LONG BEFORE MONEY

Graeber explains that societies without money do have “tokens of value”, which he defines as “concrete media of circulation”. These could be cowrie shells, quetzal feathers, wampum beads, or even the exclusive right to legitimately perform a certain ritual act.

Here is a list of the most important qualities shared by all such “concrete media of circulation”:

1. They are measures of value, as they serve to mark a contrast between greater or lesser degrees of dominance, beauty, honor, prestige, or whatever the particular valued quality may be.

2. They are media of value, as they are the concrete, material means by which that value is realized. In other words, it is not enough for tokens of value to provide a way of contrasting levels of value; there have to be material objects, or material performances, which either bring those values into being in a way that are perceptible to a larger audience, or are translatable into things that do.

3. These tokens almost inevitably come to be seen as ends in themselves. Actual people tend to see these material tokens not as “tools” through which value can be measured or mediated, but as embodiments of value in themselves; even, in classic fetishistic fashion, as the origins of those very values

The last point is crucial, because this is what finally points the way towards reconciling social structure and individual desire, which is precisely what a value theory was supposed to do.

To summarize:

1. VALUE COMES FROM DESIRE

2. MONEY QUANTIFIES VALUE

3. MONEY BECOMES DESIRED BECAUSE IT REPRESENTS VALUE

In other words, all tokens of value become talismanic. Money is a fetish.

I rest my case. Your move, ebear.