I’d just like to recommend reading David Graeber’s fascinating Debt: The First 5000 Years. He starts off with a description of how money came about (as far as we can tell), including a thorough demolition of the classical notion of development from barter to money to credit, suggesting that it’s actually the other way around empirically; you start out with moneyless credit economies, go to money, and finally have barter really only in specific cultural contexts or when a money-using society for some reason cannot use money anymore.
What the book certainly does is thoroughly demolish the notion that there is something about humanity’s biological or genetic makeup that requires us to be foreever in the pursuit of money. It’s our particular economic system that makes us do that–a system which is also heavily invested in convincing us that it is the consequence of our natural predilections, of course…
Money, no matter if it is paper, gold or infidel foreskins provides a similar function, it is an IOU to avoid a logistical nightmare.
Lets say you need a pound of cheese, so you visit the cheesemonger.
The cheesemonger wants a chicken, and has no need for the services of a furrer, which is what you happen to be.
So you visit the chicken farmer whom whom needs 5 pounds of apples, so you have to go the orchard owner whom needs 5 yards of cloth…so on and so on and you have to do this EVERY time you need something.
The ONLY reason to have used any rare item as currency is to prevent massive inflation and not due to the value of that rare item. But those rare items were not immune from inflation our would severally limit the number of people whom could be involved in commerce. As an example there is only enough gold on the planet earth for each human alive today on earth to possess the equivalent of 5 wedding bands, it does not scale.
If you have a gifting society that has no concept of ownership that does work up to a point but you also tend to hit a blocker when it comes to specialization, and it tends to only work in situations where food and space are plentiful.
But with out specialization you don’t have a fridge or a pantry to share, because the people whom may have invented and built those things were too busy talking to an orchard owner trying to get a block of cheese.
I’m intrigued. Could you elaborate on a ‘moneyless credit society’? Is it something to do with remembering how much ‘credit’ each person has somehow? Perhaps by establishing a ranking order in a society or similar, so that high-ranking individuals have more credit?
There are so many reasons why this doesn’t work at scale, it’s difficult to know where to start. It’s probably better to just explain the outcome. What you would have is a society with massive shortages of some things and massive surpluses of other things. Basically production of anything is arbitrary. Since there are no prices, there is nothing to signal to the market to produce more of any particular product.
In a market economy, high tomato prices signal the vegetable lady to grow more tomatoes. Or it tells other profit-seeking people to grow tomatoes. As production grows, prices lower and that signals the vegetable mongers to maybe find other products to sell.
Without the market, how does one define “greed” or “overconsumption”? Maybe I freeze a years worth of vegetables so I don’t have to keep going to the vegie lady. Is that overconsumption?
It’s not credit in the financial sense of having a credit record, it’s what I’ve called in other threads the favors economy: instead of IOU so much moolah, IOU a favor. Today I do something for you, tomorrow you do something for me. Mutual back-scratching.
It works fine until the mother of the child whose birthday is being celebrated tells the teenager who’s been keeping the damned brats from killing themselves or each other “thank your mother for me”. “My mother hasn’t been here :mad:”
Many Communists or Marxists confuse what ought to be, with what is. They think that because people *ought *to be selfless, generous to a fault, and do things with no mercenary motive in return, that people therefore *are *that way.
Exactly. There’s another big problem with any money-less system that involves exchanging IOUs or favors: What if a *stranger or outsider *drops by and needs services or goods?
I live in Texas, for instance. When I have a flight stopover at JFK Airport in New York City and need a cup of coffee and a bagel at that New York airport, I am extremely unlikely to ever encounter the coffee/bagel vendor again in my life. Any “IOU” that I could give him in return for the coffee/bagel is almost impossible to honor or for him to claim.
But by having cash on hand, I can immediately compensate him for the coffee and bagel and then go on with the rest of my life and never see him again, and he will never see me again. And both of us would be perfectly satisfied with that transaction.
Yes; in a case like that (where someone is freeloading) that person will lose social standing, and move down the social register, even if that register is not recorded formally. This sort of social capital would only apply if everybody in a society knew each other, or at least were acquainted with one another sufficiently well to know their reputation.
In a civilisation of billions of people, it would be difficult to keep track of social capital without formalising it in some way - as Lemur866 said, much earlier in the thread,
It may be the case that in some future time most consumable goods will be so cheap as to require no accounting system for payment; but there would still be a need or some sort of accounting system to account for other services, even if that is a reputation-based accounting system.
Luckily by the time most consumables are that cheap we should also have very cheap data-processing available to everyone; we could all have a reputation score as part of our data footprint, which could be used as credit wherever necessary. In short- everyone would know the score.
Presumably, in such a society, since slacking off and hoarding would threaten the social order, they would be crimes, in the same way theft is a crime in ours. People would be taught from early age that being a lazy ass that doesn’t contribute or taking more than your share of things is a really, really bad thing, not just a character flaw. It would most certainly reduce a lot the tendancy to do such things in the same way our poor view of thieves reduces the tendency people might have to steal. There still would be slackers and hoarders, in the same way there are still thieves amongst us, but then it would be up to the court system to deal with them. Maybe they would be the only ones required to use “money”, like in showing work certificates in order to take the bag of flour, and have everything they take noted down.
“Human nature” is in large part countered by culture, education, social pressure. And when that fails, by punishment. That’s how we keep our societies running despite human nature. Presumably, it would be the same in this hypothetical cashless society. Big opprobrium for people who refuse to abide by the rules, and a court system to deal with them.
“Moneyless credit” just means that when the men go out hunting, everyone remembers who went out hunting and who stayed behind doing nothing. And if you keep sitting on your ass while everyone else is working then people get pissed off.
I agree that it’s a mistake to think of an early neolithic farming village operating by barter. People just made stuff and gave it too each other. But they kept track of who did what, the same way I keep track of how many times I wash the dishes at my house. There’s no formal accounting but if I’m cleaning the house I’m going to make everyone else work too.
These systems become formalized at temples. Originally everything is done informally. If there’s a guy who does a lot of religious stuff, that religious work is treated as work by the group. He’s not viewed as slacking off when he’s chanting and whatever, that stuff is just as important as hunting and plowing, so he’s included in the informal credit economy.
But when it becomes more complicated there’s a more formal arrangement. Everyone who isn’t a religious specialist should bring a certain amount of goods to the temple every certain time period. And rather than just remembering that each person has brought what they owe, they keep track of it somehow. A clay tablet that says Thag brought his tithe of barley to the temple for the year is the earliest sort of formal credit. It’s too complicated to just expect everyone to bring a “fair share” of grain to the temple, now we have to mark it down.
Again, this isn’t barter. People don’t barter when they exchange with their neighbors, you only barter with people you don’t have strong relationships with. If you have a close relationship with someone you just give them what they want, and mentally add that to the pile of how much you’ve done for them. And note that in many cases it is perfectly fine for some people to give out goods without expecting a favor in return. Or rather, the “favor” is increased social status. If you’re constantly giving people stuff, then you’re a big man. And when you constantly accept stuff from the big man, you’re implicitly acknowledging his superior social status.
So formal barter–“I’ll give you five chickens and in return you give me four baskets”–only occurs in an economic system where transactions are commodified. You can’t just owe the basketmaker a favor, because you might never see him again. So you have to conclude the favor exchange right then and there, and exchange goods at some agreed upon bargain. And this is much more like using money, except without the money. Money is just a token for a certain value of favors/goods/services. The earliest form is to just give people stuff and remember it. The more complex form is to write it down. Even more complex is to use a token. Even more complex is to use a token that can be exchanged. And barter is a money-like transaction in the sense that at the end of the transaction the books are balanced. Credit–owing someone–is a much more natural and earlier form of exchange.
But this leads to another problem: You can’t ever retire.
Unlike a moneyed society, in which you can save up money and then spend 20-30 years of retirement not working, but using saved money to pay for cruises and pina coladas and a retirement villa, in this system, you can’t slack off or stop working or contributing, ever.
Not necessarily true, but the necessary social contribution would have to come in a form other than allowing the individual to pile up wealth for later use.
Then again, I think the traditional notion of “retirement” is close to a mass delusion if not a scam; what’s wrong with an aging segment of population finding something else to do with their days that’s still productive but more rewarding or entertaining than a job suitable to a younger adult?
It’s the same problem. If there is no mechanism for storing and transferring wealth, people will starve to death as soon as they can no longer be productive. Whether that’s due to old age, an injury or simply not having skills that anyone needs.
So a society where you can’t own property or stop working. Basically “slavery”.
Not while the universal foible of greed festers in the human psyche like a malignant cancer, it cannot.
While humans are compelled to hoard wealth, and hold themselves to this malicious measure ― as distinct from the rectitude of character or what they contribute towards the betterment of the species ― no man will ever be judged according to his abilities, much less needs. A system that deifies disparity, can never permit equality to blossom.
If the banksters’ ostentatious lifestyles are worth out-of-pocket bailouts approaching the trillion-dollar mark, while N.A.S.A. must panhandle for what―cumulatively―over its entire existence―amounts to significantly less, then it’s shamefully clear that we, as a species, have our heads screwed on wrong.
I don’t necessarily agree; I don’t think this is addressing quite the same problem. A society could take care of its needy just fine without “money” in the mix, but it would take a (literally?) superhuman level of mutual compassion. Since the latter can’t exist outside of very small communities, and five thousand years has shown that humans need some kind of marker system for wealth… no, a moneyless society of any scale cannot persist. But care for the needy is only part of that problem.
There’s a gradient between appropriate self-interest and greed (and then onto exploitation). Only in that utterly theoretical community of perfect individuals would you have no “greed” down to the level of holding onto retained wealth for rainy days to come.
No, it has nothing to do with “greed” or “compassion”. Economics is the study of making choices. Resources are finite. Labor pools are finite. Time is finite. A society has to choose where to allocate resources because it can’t allocate them everywhere at once. Deciding to build and maintain a hospital is deciding not to build and maintain a homeless shelter. Building a high speed rail is deciding to not build a powerplant. Without money, a large complex society couldn’t manage the complexity of even building it’s own infrastructure. Such a society would have more needy than it could care for because it would have so many shortages.
Mr Smith, you keep swinging from specifics to generalities and back again. I’m pretty sure I’m not the only one who’s finding it confusing.
I completely agree that it is difficult to imagine a society operating without some kind of economic scorekeeping. My example of taking care of the needy supposed a very small scale of very select participants, which isn’t reality at all.
Thanks to Lemur for trying his hand at this, since I didn’t have time to do so. It’s fairly close to what Graeber argues, but this whole “informal” vs. “formal” thing I think is a mistake. I said that it depends a little on what you take “money” to be, but: Graeber suggests that even such advanced civilizations as those of the Fertile Crescent didn’t really deal much with money, but worked largely on credit. That’s to say, if you owed taxes, or made a trade, it was far more likely to be run up on a tally somewhere, and only settled when you had something that could be traded. So, for example, if you were a peasant, you might have a tab at your local temple that kept track of what you owed, and you would settle it in grain when the harvest came; same at your local market; same pretty much everywhere else. These tabs, says Graeber, would in fact be kept in silver–but since everything traded in silver, you could easily settle your debts in silver-equivalents.