But in case you want more detail than that, let me start at the beginning: a site which has disappointed me far more than it promised: the conversation, specifically an article published yesterday about the possibilities of living in a Money-free society. I think I am just going to have to Fisk it. Full marks for being non-mainstream (I'm totally joking, this is fairly mainstream now: capitalism is what is on the margin these days), but I'm not convinced.
But the ten contributors to a new book I co-edited, Life Without Money: Building Fair and Sustainable Economies, offer strong, radical responses to defenders of capitalism and the so-called “free world”. They set out money-free models of community-based governance and collective sufficiency, arguing that production for trade contorts and destroys humane and natural values.'Radical' and 'strong' responses, good, we need ideas. 'So called "free world"', good, we are definitely not in one nor is virtually anyone on the planet. OK money-free governance. Where to start, really. Firstly for the whole of human history the rise of civilised society has always been associated with the rise of money. We have been scrambling for a good form of it since, well, forever. The minute you want to stop growing wheat and start doing something else and trade that for your grain, you need money to know what things are worth and whether you're getting a good bargain. Production for trade creates peace, because it's cheaper to trade than to sieze - it's a better use of your time. Production for trade improves quality because all things are produced by experts, except the very cheapest, and even with them experts have helped make them as cheap as possible. Production for trade improves efficiency because everything has value.
They offer strategies for undercutting capitalism by refusing to deal in money, arguing that we need to replace monetary values and relationships by accounting directly in social and environmental values.How do we know what these hypothetical values are, and how much value should be assigned? The price system automatically values things according to their scarcity, utility and so on - who is in charge of valuation in this money free society?
... capitalists and workers alike fear more and worse instability in global financial markets.Ahhh yes, I do agree with that. Financial instability is a serious problem, and one that didn't exist when the market was allowed to provide money. Now that money is created on the whim of politicians and bankers, the market has little say on its production. That uncertainty alone is worth noting, but fractional reserve banking has done far more to ruin the market than any mere currency manipulation. By periodically expanding then contracting the money supply, fractional reserve banking gives rise to the business cycle, in other words it causes recessions. So they do have a bit of a point about this money system being no good, but I maintain that even with its evils it is billions of times better than having no money at all.
That's not in fact true. People's fortunes depend on satiatin other people! Isn't that wonderful? A person's earnings are commensurate with how well they serve other people. There are exceptions of course, but this is the rule. What exactly is overconsumption? Throwing away newly made LCD TVs? Yeah, but no one does that. Built into the term overconsumption is an ideology that believes there can be too much wealth, that people can be too prosperous. That is simply false. There is no such thing as being too wealthy, there is only being too poor. Too poor to live. Everything above that level is wealth beyond the dreams of the 100 billions who have gone before us.Even those of us who are not managers or workers are intimately integrated into the monetary system; everyone’s fortunes depend on satiating Mammon.
For the wealthy north, overconsumption is a very real sustainability-cum-economic challenge: if everyone decided to live modestly capitalism would disintegrate. Growth is capitalism’s achilles’ heel. While overconsumption in the north demands that we develop less materialistic ways of living, it is simply impossible to imagine either individual entrepreneurs or national GDP “degrowing” without a planned economy, at which point we have only two options.
Materialism is another loaded term. We worship stuff. We see an ad, we buy its product. We are mindless consumers, endlessly throwing away our old stuff when we see the new. No one in the real world acts like that all the time. Do you? Are you therefore the only thinking person in the world where everyone else is a mindless spendaholic? Some people act like that some of the time about some things, but usually it is impossible for a product to become really popular unless it is really good. Consumers demand quality and they demand it cheap. They don't demand something that needs to be replaced every five minutes, and if a company tries to sell it to them they will fail.
Yes, we have a lot of stuff and yes, it's a lot more than many people have, but the fact that they don't have it is not our fault, and certainly not because we have stolen their reseources and there's nothing left for them. Africa is awash with natural resources, so is South America, Asia, the middle east. They have more stuff than they know how to use, but aren't as wealthy as us. The reason for that is simply that we have had a better currency system for longer, meaning we have had greater division of labour and therefore better experts making better stuff for cheaper, for hundreds of years, but most especially the last couple of centuries. Money makes us wealthy.
There's more. If everyone decided to live modestly there would be no significant difference. People would work, producing much higher quality goods that would be much more expensive. That's pretty much it. It does rather depend on your definition of modestly. If you mean giving stuff away then no, not everyone can do it or you're back to where you started. If you mean saving more and investing that will only grow the economy faster. If you simply mean working a lot less then people would find something else to do with their time.
There is the option of state-planned economies, which are out of favour among the left and right alike. The problem with planned economies is working out how everyone gets a say in what is produced. If distribution is more on the basis of need, it would appear money has little function. If we were to have less we would be very concerned to make sure we had enough and the kinds of things we feel we need, or badly want.Production is not about what we need. We have filled every need by 9:30 AM. If we only produced what we needed we'd go home and, I dunno, probably just have quite a lot of sex all day. Actually, we wouldn't. We'd make other stuff - art, literature, science, travel, philosophy. Humans are made to produce! We produce, non-stop, all day. In the old days all we could do in a day was grow enough food to feed ourselves. Nowadays we can produce vastly more. If you sent everyone home after an hour's work (to pay their food bills), they'd start new companies and create new stuff because people don't like to be idle, they value their time and their labour, and they use it to improve their lives. So what would happen if you stopped people working at work is they'd go home and work. So if everyone's physical needs are met with an hour's labour, what are the rest of the hours for? They meet the needs of other people, and other people in turn meet their needs. How do they know what to do, what people want? The price system. The price system gives everyone a say in what they want, because if they want something they'll exchange some of their hard-earned for it, if not, they won't and no one can make them. That's why it's a free market. There is no other way to efficiently organise an economy, because there are too many variables. By reducing everyone's wants to one signal - the price - money serves the indispensable function of telling people what other people want. An enterprise is profitable if people want what it has, and it fails if they do not. There is no choice but to serve the customer.
On the other hand, non-market forms have the distinct benefit of offering individuals and neighbourhoods economic democracy.As I was saying, price is the ultimate democracy. What somone is willing to pay for something is their vote. You cannot have prices without money.
But the economic infrastructure of a world in which we could all have a say in how we live our lives is sketched out in the final chapter of Life Without Money, which offers a model of a “compact society”. “Compact” because all the main relationships and structures would be based on legally enforceable voluntary agreements, rather than monetary contracts.Wow - by working together people can have more than if each worked by himself! If only we could apply that to the whole world, imagine what we could do! Or rather, forget what we ever though we couldn't do! We could conquer the galaxy! But how can we work together efficiently? I know, let's use something rare and long lasting to trade with. We could strike it into coins and call it - I dunno - Monay ... Monet ... Minno ... Money!! Some people wouldn't even have to farm for a living they could spend all their time inventing cool stuff to make our lives even better!!11@!@!!!!!!ONE
Instead of establishing tiny self-sufficient households, we’d work collectively, with a range of connected local households occupying a basic unit of a neighbourhood, the size of which would be flexible and dependent on the local ecology. Local collective sufficiency would be the key aim of every neighbourhood, sourcing materials for, and making, food, clothing and shelter as well as other basic needs, through appropriate technology.
Of course, there are likely to be needs or wants that people could not source or create locally. Ideally, these would be obtained from a neighbouring area or through the least environmentally and socially expensive option available at the time.Hmm yeah, good idea. Let's trade using a universal system of account. It so happens I already invented a name for it: Money (C) [TM]
Establishing and maintaining collective sufficiency would require every individual to work out what they would need over a year, assessing local potential, planning how to meet the needs listed, working out how surpluses might be generated, and negotiating with other units to fulfil their needs. The internet facilitates this kind of collective research, planning and negotiation, which would involve numerous compacts.That sounds like a lot of hard work. How do you know what things are worth? No one can know everything! Oh, phew, they don't need to, they only need to know the price. Well that's a relief. Oh, wait, you want to do this without money accounting? Crap. Crap! CRAP!!!
