Self Awareness, Philosophy and The New Paradigm In Economics and The Money System

KZ:   Garrett and Craig, in other words, why was money invented? No one really knows all the details.

Ancient Greece was the first civilization to be transformed by money, but shortly thereafter money colonized all cultures after the Greeks. Humans have found many ways to bring order to the flow of experiences and consciousness. Money is one of the most important. Money is strictly a human invention in that it is itself a metaphor; it stands for something else. Just about anything else. It allows humans to structure life in complex ways not available to them before the invention of money. This metaphorical quality gives money a central role in the organization of societies and cultures. Money represents an infinitely expandable way of structuring value and social relationships—personal, political, and religious as well as commercial and economic. Money created marketplaces everywhere it went. Money created a new urban geography in giving rise to towns and cities centered on the marketplace rather than the palace or temple. The exchange of goods demanded new commercial routes over land and sea from one market town/city to the next, thereby creating a web of commerce that linked all these market cities/towns. This new social network founded on commerce and money gave rise to a new political system. Alexander the Great expanded this new commercial network and with it spread the new political system, which would eventually become democracy.

Greek became the language of commerce, and of political and religious discussion. The Greek spoken in the markets of Iberia and Palestine was not the classical Greek of Aristotle and certainly not the ancient Greek of Homer. The merchants used a simple, almost pidginized form of shop Greek, but this language proved capable of conveying great ideas far beyond the needs of simple market exchange. The marketplaces of the Mediterranean became focal points for discussing a new kind of religion. The followers of Jesus used the simplified market Greek to spread their ideas from one market center to another. The language of the New Testament was called “God’s Poor Greek.” This allowed for the rise of a “common person’s” religion, open to all people. Christianity raged through the cities of the Mediterranean as a totally new and revolutionary concept in religion. It was a uniquely urban religion that had none of the fertility gods or weather gods of the sun, wind, rain, and moon associated with farmers. It was the first religion that sought to leap over the social and cultural divisions among people and unite them in a single world religion. Its followers actively sought to make Christianity a universal religion; they did so in much the same way that money was creating a universal economy. A thousand years after Jesus, Islam followed the example of Christianity, creating another world religion.

According to anthropologist Ruth Benedict, every culture organizes life around a few core principles, activities, and beliefs; from which all institutions and activities hang like apples on a tree. That core for western culture is money. Money is the cultural configuration of western culture. But money was not the configuration for all cultures. The Dogon of Mali organized their lives around art and ritual, the Nuer around cows, the ancient Egyptians around death, the Aztecs around human sacrifice, and the Papuans around marriages, yams, and pigs. Each of these offered a focus for conducting the essential activities of life. The odd abstraction we call money would make no sense to these people, just as we would find their cultures strange and unappealing. Money, by contrast with these forms of aesthetic and biological satisfaction, lacks immediacy; yet in modern society, money serves as the master key that unlocks nearly all pleasures—as well as many pains. Money constitutes the focal point of modern world culture. Money explains nearly all relationships among people, not just between customer and merchant in the marketplace or employer and laborer in the workplace. Ever more in modern society, money designates relationships between parent and child, among friends, between politicians and constituents, among neighbors, and between clergy and parishioners. Money forms the central institutions of the modern market and economy, and around it is grouped the ancillary institutions of kinship, religion, and politics. Money is much more today than the language of commerce. Yes, humans have yet to work out the consequences of this dominance of money. It seems necessary but they don’t always like it and worry about its longer term implications for Sapiens’ survival. Our species has taken wrong evolutionary and cultural turns before. Is money one of these?

In the 20th and 21st centuries money has changed. Credit card served as an easy accounting device in a world where people no longer bought and sold goods and where the government had either replaced or become a partner with the market. Money no longer had value in terms of gold, silver, or any other commodity. It had become merely “an algebraical symbol for comparing the values of products with one another.” Money had become just accounting. The credit card increased purchasing and, therefore, production and services, but it did so at the cost of increased individual (the single consumer of neoclassical and neoliberal economists) debt and international inflation. But credit cards also increased the status of some and lowered it for others. By the end of the 20th century spending for luxury and pleasure was the new metaphor created for money. According to Georg Simmel, “when money stands still, it is no longer money.” Following the credit card, electronic money, spending, and investing have increased the speed of money a thousand-fold. This new subterranean or invisible money is changing western society in fundamental ways. We now live in the “age of money.” Money mostly defines and controls our lives today. What began as clearly a human invention is now a metaphor for the most powerful and uncontrollable power on Earth.

Me:  I wouldn’t necessarily disagree with the details of that chronology, but as I have pointed out here before, history and its human adjunct study anthropology, are the chronology of humanity’s relative lack of self awareness/unconsciousness. And therein is the real problem….as you yourself come around to observe at the end of your post. Therefore, the real problem is that humanity has not cognited on the insight expressed and emphasized in the zen Buddhist saying: Wherever YOU go THERE. YOU. ARE.

Economics and the money system need a new philosophy the study of which includes ethics. As a new paradigm is a singularly unifying philosophical concept that resolves the deepest and most chronic problems of the current paradigm and thus creates an entirely new pattern in the body of knowledge/area of human endeavor that it applies to….a new philosophical concept that defines the new pattern ought to be the front and center concern of all economists and economic pundits….no?

JV:  Sorry Craig, but our theories are irreconcilable. In mine, delineated from first principles, fiat money is strictly a unit of account. Following that truth, until contradicted, it’s a no-thing without a quantity, velocity, or any identity attributable to a thing. No perceivable monetary manipulation can change that reality, only an alternate reality from a different set of first principles could possibly do so. I’m afraid, aside from contradicting mine, that’s your only option. Why don’t you give it a try?

Me:  So you’re agreeing with me that money is basically accounting. Good. You’re problem is you’re simply refusing to “up your game” to utilize philosophy and to look at the economic/legitimately productive process itself. Apparently you think “bean counting” is all that is necessary to fix the economic, financial and money systems.

Have you ever had to pay more than the price of retail sale? Except for the supposedly legitimate economic/productive business model of finance, of course you haven’t. Utilizing the knowledge that retail sale is the terminal ending point and hence by definition must be the terminal expression point for every legitimate factor including cost, all forms of inflation and price, then a simple algebraic operation can change scarcity of individual income into abundance of same and harmful price and asset inflation into beneficial price deflation…..”miraculously” even in profit making systems.

Paradigm changes are always characterized by conceptual opposition to the current paradigm and inversion/transformation of same. And the actual operation performed to bring about the paradigm change is always basically very simple and yet relevant and deeply affecting.



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