?

Log in

No account? Create an account
Money and the Temple - The Ex-Communicator

> Recent Entries
> Archive
> Friends
> Profile

September 17th, 2011


Previous Entry Share Next Entry
03:12 pm - Money and the Temple
There's an interesting article in Crooked Timber today about the popular view that modern money economies arose from barter economies - that currency is a method of systematising trade exchange. It is notable that no culture has ever been discovered with a barter economy. In societies without currency, passing on of goods is based around prestige (and family and so on) rather than barter. This is not a generalisation, it's a rule to which no exceptions have been found. See this paper for more information:
economists thus predicted that all (100%) non-monetary economies would be barter economies. Empirical observation has revealed that the actual number of observable cases—out of thousands studied—is 0%. Similarly, the number of documented marketplaces where people regularly appear to swap goods directly without any reference to a money of account is also zero. If any sociological prediction has ever been empirically refuted, this is it... Meanwhile, all textbooks continue to report the same old sequence: first there was barter, then money, then credit.

I believe currency arose to systematize temple tribute. That is, in stage 1 peasants send grain to the temple, and the temple gives the grain to soldiers and road-makers (the earliest writing records these transactions). In stage 2 the temple gives the soldiers grain-tokens and the soldiers given them to the peasants for food, and the peasants pay tribute back to the temple in tokens. Now only tokens need to be stored and transported. Empires which circulated tribute-tokens instead of cartloads of grain could get geographically bigger. Tribute-tokens evolved into currency (here is an academic paper setting out this view in more detail)

A larger point arising is that money, exchange-relationship, and ownership itself, are not primal features of the world, or of humanity. Ownership exists within a context of social values and responsibilities (thus refuting Libertarianism). And money is not a fuel which can be used up, it's a medium which goes round and round (thus refuting right wing economics).

It's amazing to me to hear ordinary people saying at the moment that the public sector uses up money created by the private sector. That is not how money works. Clearly in the temple-tribute model what matters is the ratio of people growing grain, to people eating grain, but sector is irrelevant. Similarly, a modern train driver is equally productive whether he is employed in the public sector, as in France, or the private sector as in England. It is absurd to think that a train driver in France is somehow a drag on the economy, and in England an asset. Or a nurse in England is a burden but not a nurse in America. What matters is: are they making useful stuff.

I think a moment's thought shows us how false these models of economics are. And yet this false story is repeated everywhere, and most sickeningly, it's the basis of the destruction of the British economy. Its throat has been cut and it's bleeding out. All because of a false view of money.

(17 comments | Leave a comment)

Comments:


[User Picture]
From:chickenfeet2003
Date:September 17th, 2011 02:42 pm (UTC)
(Link)
I took Economics in the first year of university. In our first lectures on microeconomics the theory of "free markets" was expounded. My question to the lecturer was "Which Christmas cracker did you get that out of?"

Economics is the "science" of proving JK Galbraith's aphorism about social conservative belief; "the poor have too much money and the rich don't have enough".
[User Picture]
From:communicator
Date:September 17th, 2011 02:46 pm (UTC)
(Link)
I feel mainstream economics is like mediaeval medicine - so wrong it's actively harmful.

Luckily we have some better economics models, and hopefully eventually, they'll become mainstream. The difference is that rich people had a motive for wanting improved medicine, but with economics it's the other way round as you say.
[User Picture]
From:steepholm
Date:September 17th, 2011 03:01 pm (UTC)
(Link)
Thank you for that post - most educational!
[User Picture]
From:communicator
Date:September 17th, 2011 05:12 pm (UTC)
(Link)
I got very interested in the history of currency about five years ago when I was running a panel at an SF convention about the future of currency. Most SF fans are (IMHO) quite conservative, and there was a strong feeling in the room that a society without currency was more or less impossible 'who would work if there was no money to pay them?'
[User Picture]
From:tehomet
Date:September 17th, 2011 03:52 pm (UTC)
(Link)
Fascinating. And thanks for the links.
[User Picture]
From:communicator
Date:September 17th, 2011 05:13 pm (UTC)
(Link)
Thanks. I wanted to show that what I was saying was not something I had literally just imagined from nothing, even if it isn't the mainstream that's taught in schools.
[User Picture]
From:spacefall
Date:September 17th, 2011 11:08 pm (UTC)
(Link)
Wordy wordy McWord.
[User Picture]
From:spacefall
Date:September 17th, 2011 11:09 pm (UTC)
(Link)
(by which I mean I Agree With This Comment)
[User Picture]
From:communicator
Date:September 18th, 2011 06:38 am (UTC)
(Link)
Thank you. I wonder how much the people who say 'public sector is a drain' believe their own stories about money. If they are relatively sophisticated they must know the model is false, but yet they pursue it as a guide to action. And the same goes for global warming deniers.
[User Picture]
From:steepholm
Date:September 18th, 2011 11:12 am (UTC)
(Link)
The whole "public sector is a drain" meme pisses me off in a serious way.
[User Picture]
From:communicator
Date:September 18th, 2011 11:55 am (UTC)
(Link)
I think it has been more or less taught in schools, it's so widespread. People talk about it as if it's an established fact. Very strange.
[User Picture]
From:archbishopm
Date:September 18th, 2011 10:45 am (UTC)
(Link)
economists thus predicted that all (100%) non-monetary economies would be barter economies.

Economists never went to BC. Your loss economists, the "scenery" scenery's pretty sweet, and also they made the X-Files there.
[User Picture]
From:communicator
Date:September 18th, 2011 11:54 am (UTC)
(Link)
Potlatch is a great example.

Reading that I see it was made illegal in the 19th century

'Potlatching was made illegal in Canada in 1884 in an amendment to the Indian Act and the United States in the late 19th century, largely at the urging of missionaries and government agents who considered it "a worse than useless custom" that was seen as wasteful, unproductive, and contrary to civilized values.'

That says it all. That is such a familiar pattern. 'Sir, the people are behaving contrary to our economic theory', 'Then stop them at once'.
[User Picture]
From:archbishopm
Date:September 18th, 2011 12:17 pm (UTC)
(Link)
Potlatching was made illegal in Canada

Lolol--my mother always disparagingly called our Christmas madness Potlatch and that was in, mmm, well I'm pretty sure it weren't 1883...:-p
[User Picture]
From:archbishopm
Date:September 18th, 2011 12:28 pm (UTC)
(Link)
(our Christmas madness was, btw, bitchin' *sigh*)
[User Picture]
From:communicator
Date:September 19th, 2011 05:19 am (UTC)
(Link)
Apparently it was made legal again in the 1950s so I think you are in the clear
[User Picture]
From:archbishopm
Date:September 19th, 2011 09:43 am (UTC)
(Link)
Whew.

> Go to Top
LiveJournal.com