I’ve decided to risk outlining the basic thesis of the
book I have been working on these last four years or so. When I started writing
it, I knew roughly that I wanted to take a systems theory approach to money and
money’s effects on society, and knew too I did not know where my research would
take me. Years later I feel like there’s something solid and clear to be
expressed. The book – which is about two-thirds finished – currently runs at
just shy of 100,000 words, so what follows here is the briefest of synopses.
However, because I get good critical feedback from my generous readers, and
because I believe the basic thesis is now solid enough to be expressed clearly and
briefly, I’m testing the water here at Econosophy.
First up, systems theory. I use Fritjof Capra’s
definition of a system: “an integrated whole whose essential properties arise
from the relationships between its parts” (1997: 27). The key words are “arise”
and “relationships”. Systems theory is an attempt to go beyond the causal
linear chains of Newtonian physics and the binary dualism of the Cartesian
paradigm. Instead of A to B to C to D forever, systems
theory sees loops, more exactly positive or negative feedback loops, consisting
of relationships between ‘parts’ that form systems which give rise to new
properties that cannot be predicted by looking at the ‘parts’ in isolation. A
negative feedback loop is ‘good’ as it is self-correcting, a positive feedback
loop is ‘bad’ as it self-destructs. So, in systems theory nothing makes sense
in isolation in a universe composed exclusively of systems/networks, right down to the
sub-atomic level: “An elementary particle is not an independently existing
unanalyzable entity. It is, in essence, a set of relationships that reach
outward to other things” (Henry Stapp, 1971). Thus there are no discreet things,
no objects per se, only networks of
relationships. In place of causal linear chains of discreet objects impacting
each other like billiard balls on the baize of time, we have in systems theory
A to B to C to D to A, a closed loop that
creates a system, an “integrated whole” in which each ‘part’ is itself a system
of further relationships, no matter how deeply down we drill. And we cannot
really say where the system starts. I could equally well express this loop as C to D to A to B to C. That said, this does
not imply pure randomness. There is progress; crawling before
walking before running, etc.
Classical and neoclassical economics are
Newtonian-Cartesian in their thinking. They posit a fundamental building block,
termed homo economicus, hard-wired by
nature to maximise profit via “truck and barter” trading in a universe characterised by irresolvable scarcity and “red in tooth and claw” competition. Homo economicus is infinitely greedy,
too, so unless we want a Hobbesian “Warre of each against all”, we need things
like money and markets to produce civilisation. Homo economicus is intelligent and inventive, so was able to solve
the problems of inconvenient barter (the instinct to barter is in his DNA) by
inventing money. Barter is mighty awkward. How many eggs for a course in
cabinet making? How many pounds of pork for a new roof? Life was hard and
primitive, then came money. Since then, albeit with bumps along the way, things
have been getting better and better. In short, money makes civilisation
possible. No money, no civilisation.
The conventional view is a fiction. The real story is far more complex..
The definitive anthropological work on barter, by Caroline Humphrey, of Cambridge, could not be more definitive in its conclusions: “No example of a barter economy, pure and simple, has ever been described, let alone the emergence from it of money; all available ethnology suggests that there never has been such a thing.”(Graeber, 2011: 29)
At root, [findings from ethnology and history] tell us that profit-seeking exchange does not exist [in pre-money societies], that such cannot therefore be a property of the human species.(Heinsohn and Steiger, 1996: 40)
Homo economicus
is thus simply an unproven assertion, a purported foundational building block required by
orthodox economic theory. Without this foundation, the entire structure built
atop it crumbles. So, how did money emerge? It’s not easy answering this
question, because the past is dead and gone, but it seems the systems money’s
emergence requires as pre-conditions are: equivalence as established by numbers
and counting, the state, private property and interest (usury). Graeber would
add warfare and slavery, and he’s probably right, but for brevity I’m going to
keep it simple. In this simple view, a systems theory take on the emergence of
a money-based system (or property system, or state system) might be this:
Private property-->state-->usury-->money/markets/price-->private property (where
numbers, counting, equivalence, slavery, justice and war/expansion/conquest are in the mix too)
Note that markets arise with money and property, that the fundamental State-Market (Left-Right)
antipathy the status quo propagates is thus Kabuki theatre. State and market are joined
at the hip, by money and property, are thus part
of the same system. We do not have truck and barter (primitive markets)
until after human societies have
passed through all sorts of stages to arrive at some form of state, in which
private property (as distinct from ownership, a critical distinction to do with credit/debt contracts, collateral and interest) has emerged and is used for increasing one’s own wealth and
security. Probing into what comes first isn’t as helpful as understanding that
these interrelationships are vital to sustaining each ‘part’ of the system. To
quote Fransisco Varela, “World and mind arise together.” It’s not that world causes mind
or vice verse. They co-create each other.
There is something about the process
of an intelligent animal with opposable thumbs experimenting with fire, planting seeds and taming
animals that leads to home and hearth, which leads to tribes, then chieftaincy, which
leads to state, property, interest, money and markets. Yes there is a certain
progressive linearity to this process, but it is also true that not all human
societies develop in this way. However, if there is money, there will be private property if that money is going to be helpful
to the functioning of that society. For example, Heinsohn and Steiger (1996) argue and cite research clearly showing that state communism failed because
it had money and banks, but no private property. An essential ingredient was
missing and thus the system fell apart. There are of course other factors in
the collapse of state communism, but this deep systemic incongruity was
instrumental in that system’s demise.
To repeat, a systems theory look at money and economics,
in conjunction with ethnography and history, shows that money is not an invented, discreet thing that
possesses value and that makes previously awkward market trading (barter)
efficient and profitable. It is an emergent property of societal development on
the trajectory of increasing control. This trajectory is what Eisenstein calls
Ascent, but that is the topic of other blog posts (and of course Eisenstein’s The
Ascent of Humanity). Money’s continuing existence requires the continuing existence of private property, state and
usury, and vice versa for each of them
with equal weighting. Each ‘element’ sustains and require the others. They
co-create each other, where each is a complex system too, with further
interdependencies bleeding into and out of them, such as war, fear, scarcity
and greed. Property-based societies are also, in my opinion, fear-based
societies.
What we do not see is evidence that homo sapiens sapiens has a market-trade gene, so to speak. Pre-state, pre-tribal
societies, or hunter-gatherer societies, are characterised by egalitarianism
and sharing. This does not mean some hippy, airy-fairy Nirvana; there was
fighting, murder, etc. Gorillas and rhinos are not predators, but will smack
you up real good if you threaten their safety. My point is that humans are not
hard-wired for greed and profit maximisation via market trading. There’s no
good evidence to support this assertion, and plenty pointing at the opposite conclusion. We adapt to the society we are born
into. For most humans today, that means a nation state of one flavour or
another, with money and markets and usury running the show, more or less. You could say we are hard wired to be flexibly adaptive to a multitude of different circumstances.
In The Early State (eds. Claessen and Skalník, 1978), approx.
20 historians examine the birth of the state in various parts of the world to determine which properties are common to them all. Their combined work attempts
to define the state, which exhibits several common qualities regardless of the form it takes: monarchic, fascist, democratic, etc. One is that it is necessarily
hierarchical or class-based, with rulers and ruled. Another is that
the state is expansive. States seek to expand their territory, probably because they are productive; humans reproduce in response to the security offered by future expectations of sufficient amounts of food
and shelter (in the absence of women’s rights, education and other factors), and population growth requires more territory.
The state is thus ‘wired’ to grow as a direct consequence of this biological tendency and the fact of the state’s hierarchical structure and productive capacity. Because it is hierarchical, it primarily benefits, in terms of distributing the wealth it produces, those at the top of its hierarchy, leading to tension, envy and repression. There is thus a constant need for an external enemy, for dehumanising some convenient Alien Other as a way of redirecting the violent potential this tension engenders.
This may seem like
Marxian analysis, but that isn't particularly relevant here. What matters to my thesis is the neat fit of
usury, private property, money and state as co-contributors to a growth-based, expansionary and rapacious system. Recall too that usury/interest is exponential growth by definition. On a finite planet,
the state therefore has a sell-by date. We are, in my opinion, currently approaching that sell-by date.
In this thesis, then, there can be no money without
state, private property and usury. Logic then suggests that when growth has to stop for
environmental reasons, state, property, money and interest may have to stop too. Or at least be radically transformed.
And there’s the rub. Systemically speaking, we are the state.
The state is made of us; without humans, there can be no state. Our entrained habits
of thought mean we can barely imagine anything different to today’s system.
Nevertheless, transitioning from
property-based social organisation to resource-based social organisation
requires a new paradigm, new thought patterns, new perceptions, new
consciousness. And on top of this inexorable pressure towards fundamental
change we have technological unemployment, which slowly renders humans less and
less relevant in money terms; our labour becomes less and less ‘valuable’ over time. Exacerbating this piece of the puzzle is our stubborn cultural sense of value. Because
of money, we have money-based ideas about what is and is not valuable. Money is, in part, a kind of nothing that happens to commoditise everything, including human work and
itself. This inescapable commodity effect has helped us to conflate money with
wealth. Society today is about making more and more money in the belief that doing so produces the best of all possible worlds.
Money ‘decides’ what gets done and what doesn’t, even though society, on the whole, does not even understand what money is.
Money and price are of course inseparable. Prices appear
to tell us the values of things, but value is far more complex than a number
adjacent to a symbol (e.g. $) can possibly convey. And yet we grow up and live
in a system which prices/values our contributions (labour) using money. We
believe, typically speaking, that we are as ‘valued’ as our money-worth suggests we
are. This unfortunate correlation means that people Just Know e.g., no one
would do any work if there were no money offered in exchange, that work must therefore
be unpleasant. We seem to viscerally believe that money makes the
world go around. It certainly helps make this system go around. Can we imagine
a system without money and price? That daunting task is the beginning of surviving the demise of the
property-money-state-usury system.
The system we are is in the depths of a fundamental and
final breakdown. The deep change required of us by the end of growth is, I suspect,
the most profound humanity has ever faced. We must upend and rethink almost
everything we think we know, to have a chance of dealing with this new set of
circumstances. Let me repeat; we must change the way we think about and perceive
reality to survive. That is a very
tall order. Sadly, our education systems produce bickering children we mistake for adults. Our
politicians and other ‘leaders’ are either ignorant or narcissistic or too
busy/afraid/locked-in to push for change. We children, we emotionally immature
physical grown-ups are tasked with redefining our very way of being. People say
Occupy failed. Occupy is the merest beginning of what we have to accomplish as
a species, globally, if we are to survive. The Zeitgeist Movement and The Venus
Project represent an analysis (and perhaps a plan in the case of the latter)
that could offer a basic methodology around which real change can be put in
motion. There are other efforts out there pushing for change too, but little
agreement among them, and more importantly, little opportunity to work together.
It can be no other way. We’re not ready for this. But then,
I was not ready to become a father. How can you be ready for something you’ve
never done before, let alone something so new no one even knows how to start?
Franz Hörmann’s “information money” is one proposal among many. Strictly
speaking, “information money” would not really be money as I have laid out here. I see it more as an idea-crutch to
help us transition towards the new. Something like it is needed.
Whatever it is
we contemplate and propose, my hope is that we properly understand the
ramifications of what is afoot. If we underestimate the enormity of the
challenge, our chances of success, currently slim at best, become vanishingly
small.
