Chapter 3: What is the True Function of Money/Currency?
The purpose, function, forms and modes of transaction have changed drastically over the course of millennia. Essentially it is a question of logistics: how do goods and services get shared and distributed within the human community?
The earliest human societies were almost certainly hunter-gatherer tribes in which members did not require any form of exchange among them. Each member of the tribe knew their job(s) and performed them organically like the organs in a body, as needed and in rhythms that evolved over time to sustain the needs of the community. There was trade between tribes: fish from coastal tribes in exchange for animal skins or dried fruit from inland tribes, that sort of thing. The exchanges were negotiated between parties on a mostly equal footing.
As agriculture, fishing, and herding spread, permanent settlements gradually replaced nomadic lifestyles. Increasing specialization developed. This led to trade becoming more common. People bartered goods and services among them individually, as did settlements and the still nomadic tribes - a pound of cheese for a dozen eggs, a wagon wheel repair for a day of help around the shop, medicinal herbs from the mountains for medicinal herbs from the lowlands and so on.
As the size and complexity of human cultures grew and new technologies emerged, it became impractical to perform all transactions via straight barter, for a lot of reasons. For example, how much cheese, eggs, meat or flint can you carry around with you for exchange? How do you determine the value of a winter coat in terms of arrows, fishing nets or wheat? Currency in the form of coins and tokens of various kinds became one solution. It is easier to carry around a pocket full of coins or small seashells than a wagon full of wood and nails.
At that point there was nothing resembling the capitalist paradigm that we see today. There were of course gougers and fair dealers, honest people and cheats, thieves, robbers, etc. But it was all on a much smaller scale than today, and whatever inequities existed were much smaller. Remember, if you only give me 8 eggs for a pound of cheese and the chicken farmer down the street will give me 12, then I will go for the better deal. At that point there was no such thing as mega-corporations or vast business empires; there were no quiet agreements among CEO’s on the golf course to work together to drive prices up by dollars and then compete among them over pennies. For the most part, each chicken farmer, each arrowsmith, each basket weaver was independent of the others. If there were exceptions, at that time in history, they were on a very small scale.
It is not necessary to track the evolution of currency in minute detail from the distant past to the present. But it is instructive to keep something of a historical perspective.
Let us also look at and understand the significance of the value assigned by different cultures to different items and substances. Some cultures used certain kinds of seashells for currency, and there were other variations. But over time humans came to value gold, silver, and other minerals and imbue them with value by virtue of common agreement and perception rather than actual utility or superiority over other minerals for any particular purpose.
Gold, silver and other metals, of course, were appealing to cultures which had mastered the art of extracting and working them, since they can be fashioned into shapes bearing marks defining their value; they hold their shape and do not easily shatter.
It is important to remember that this valuation of gold, silver, platinum, diamonds and the like is completely arbitrary. Each has their useful and aesthetic properties, but there is no inherent reason to value them above other substances or objects. Yet wars have been fought, murders committed, families and friendships sundered, people enslaved, and civilizations conquered and subjugated in the process of seeking, obtaining and accumulating these things. Blue jays and magpies are drawn to shiny things and apparently so are humans. In and of itself, that is neither constructive nor destructive. The perception and appreciation of beauty certainly adds to our quality of life. How we express that fascination, however, is entirely and arbitrarily subject to choices we make as individuals and as societies.
At some point, another dynamic began to enter the equation, which introduced new complexities and destructive patterns into the use and function of currency. If I can install myself up-river from a village or town with enough armed fighters to back me up, I can build a dam on the river or divert it to control the availability of water to the town. When the townspeople suddenly find the river drying up, they will come up my way to investigate, at which point I can tell them that if they want water they will have to pay my price. For that matter, I can charge a fee from every town and village down-river from me. As long as I have sufficient arms and a strategically defensible position, there is not much the towns can do about it, unless they can overpower me by force of arms. If I make a few people in each town my agents and elevate them above the rest of the townspeople, keeping them compliant through bribery and intimidation, they will suppress any attempts of townspeople to oppose my power.
Another destructive dynamic that crept into the picture was active threat. We will burn your house down or beat you up, destroy your crop or kill members of your family if you don't pay us a fee. Normally this conjures up images of gangs, the Mafia, drug cartels and playground bullies. But sadly that is largely how most royal families built up their fiefdoms and how many entirely legal and widely respected companies and sovereign countries do business and get away with it, because technically they are not breaking any laws. Capitalist paradigms contain strong reinforcers for these behaviors. As will become clear in the course of this writing, the distinction between street gang, drug cartel, Mafia, royal family, dynasty, and business empire is artificial and flimsy at best.
In the current state of Capitalist society in the world, money for the typical working person has two functions: to acquire desired goods and services (a TV, tickets to an entertainment, etc) and to pay for the necessities of life. Unfortunately, as in the company towns that were common before there were anti-monopoly laws and labor unions in the United States, it is essentially the same tiny segment of the population who determine both what working people are paid and how much they will have to pay for said necessities and amenities. The end result of this is a steady redistribution of money, resources and control from the bottom of the economic pyramid towards the top, since as we shall see, Capitalist paradigms are hierarchical pyramid schemes in which those at the top steadily drain energy and resources from those at the bottom. It is inherent in the paradigm.
Currency has taken new forms undreamt of until recently: paper money originally was linked to the value arbitrarily assigned to silver and gold, but eventually was decoupled from that standard. Now the value of paper and metal currency is arbitrarily determined independent of precious metals. In addition, the majority of transactions at the time of this writing are done electronically and only exist as bits in databases. This clearly shows that currency and its value are purely a matter of concept and imagination, not an inherent set of properties of nature. Yet the way the dominant Capitalist society functions, these bits define and determine our rights, our options, the level of respect or lack thereof that we are afforded, even our right to a livelihood, a place to live or to pursue our Constitutional rights if we live in a country that has some form of Constitution.
As things are now, currency in all of its forms no longer functions primarily as a medium of exchange to facilitate the flow of goods and services among people, nor does it primarily grant access to desired commodities, EXCEPT for the microscopically small segment of the population at the very top of the economic pyramid. In the current state of Capitalist society, in practice, money is used by the ultra-wealthy who control most of the resources to create scarcity and erect barriers to limit and control access to vital goods and services for the vast majority, for 99.5% or more of the population.
Even though the U.S. Constitution grants us many rights starting with "Life, Liberty and the Pursuit of Happiness," the economic system places a high price on actualizing those rights, effectively acting as a barrier to exercising them.
Look at one of the most basic of necessities of life: having a place to physically be, to live. In order to have a place to be, in Capitalist societies you have 2 choices: buy a place or rent a place. Either way you are forced to pay to have a place to be. If you are homeless or try to live on public land, land that is not being used, or even in a vehicle such as your own car or RV outside of an RV park or campground that charges rent, many and increasing numbers of towns and cities have laws forbidding it either expressly or indirectly.
Owning one’s own place is of course preferable to renting, since in Capitalist societies it carries a greater degree of freedom and economic safety than renting. In Capitalist paradigms, however, home ownership is always priced far above most people's ability to buy with cash, which forces most prospective buyers to seek a bank loan - mortgage - which effectively translates into the bank owning the home until the buyer pays off the loan with a huge amount of interest. If one is in a weak financial situation, the banks will not loan one the money, making it impossible to own one's home.
Renting means paying money every month to a landlord who has dictatorial rights to determine much of what the renter can or cannot do in the living unit, including having guests or family visit, planting a garden, making improvements or changes – and of course the landlord can raise the rent at will and even revoke the renter’s right to be there.
Many American cities have even passed laws making it a crime to feed or help the homeless. An increasing number of American cities are giving the police the power to confiscate the sleeping bags, tents, winter coats and other possessions of the homeless with no due process, in a culture that values private property as sacrosanct. In practice, the sanctity of one’s private property is directly proportional to one’s place on the economic pyramid.
There a few places that have made it illegal to catch rainwater. Citizens are forced to pay for water even where there is water available to them from nature. In the state of Michigan, millions of struggling people have had their water supply cut off because they couldn’t afford the exorbitant cost of water. These people are thus deprived of one of the most basic necessities of life, even if they are working and contributing to the community. (Much of the water supply in Michigan is also contaminated and unsafe to drink due to unregulated industrial pollution) There are many places that have various kinds of laws and regulations that restrict homeowners and renters from using their yards for cultivation of food or the raising of food animals or chickens for eggs. People are forced to have to pay for food, water, and a place to be.
Even though there are not generally laws specifying in so many words that it is illegal to live without paying for the privilege, there are a plethora of laws that translate into the same thing when one does the math. If it is illegal to live on “privately” owned land or buildings, and it is illegal to live or sleep on “publicly” owned land such as city parks and lands, streets or even the gardens along highways or National Parks, and it is illegal to live in a vehicle (including an RV designed for habitation) unless parked on “privately” owned land where rent must be paid, then in practical terms it means that it is illegal to live without paying to occupy space. In such a paradigm, if one is living on unoccupied land, seeing to one’s own needs without taking anything from or harming anybody, and not collecting public assistance, then one is still defined as a criminal.
In practice, rent, mortgage and other enforced charges on life’s necessities mean that unless one is a member of the extremely wealthy at the top of the economic pyramid who own and control the majority of resources, one’s life is unceasingly held hostage. Every month, you forced to pay ransom on your own life. The principle is also similar to that of paying protection money to gangs or the Mafia. Pay your monthly protection or suffer deprivation of home and all the necessities of life. There is no functional difference between rent, mortgage, ransom, and protection money. Only the terminology is different.
Under Capitalism all people are forced to pay to live, to exist at all. In practice, one's rights, freedom, degree of respect received, and options in life are in direct proportion to one's wealth. In this way it is clear that Capitalism as we see it now in the United States is in direct opposition to the U.S. Constitution, eroding, undermining and subverting it. The Constitution guarantees U.S. citizens and residents rights starting with Life, Liberty and the Pursuit of Happiness. The Capitalist Paradigm creates conditions in which one has NO rights, not even to occupy space, without paying for it with money. This is a direct contradiction. This is a fact worthy of pointing out to the awareness of all who have sworn an oath to defend the Constitution against all enemies, foreign and domestic. If you have sworn such an oath, then it is your clear duty to defend the Constitution against Capitalism and support or protect the Transition to the new paradigm.
Using the concept of "Free Enterprise" to defend Capitalism is a gross distortion, as the business practices of gigantic corporations and the ultra wealthy effectively create an environment caustic to small business, freelancers, and those who wish to live without participating in the money economy. Enterprise is theoretically free to all, but in practice is free only to those at or very near the top of the economic Pyramid, just as theoretically any citizen who meets age and citizenship requirements can become President of the United States, while in practice the only potential candidates who will realistically ever even reach the race are people who are either wealthy themselves or are connected to others who are. It was not that way in the time of Abraham Lincoln, but it is now.
In its current form, money/currency is most frequently used as a way to create scarcity and barriers blocking access to goods, services and even the most basic necessities, as a means of controlling, disempowering, dividing and effectively enslaving the vast majority of people. A populace locked into a constant losing struggle to survive paycheck to paycheck, fighting over meager opportunities for minimal advancement, constantly stressed and exhausted, is a populace unlikely to have the time, energy, will, or cohesion to form a coordinated concerted front to challenge and overthrow the system that is keeping them in that condition.
Add to that backdrop the aforementioned wide range of accessible distractions that disperse and dissipate rather than focus social, emotional, and motivational energy, plus immersion in constant propaganda from birth convincing people that they have freedom, that theirs is the best possible world, and you have an ingenious and insidious way of preventing the people from rising up and challenging the status quo.
Yet it is not a hopeless situation. Historically we see that the Chinese Revolution succeeded against the odds even though the Red Army started out as half-starved uneducated peasants against a militarily vastly superior enemy. The American Revolution was similarly able to prevail against an apparently insurmountable set of obstacles in going up against the most powerful superpower of its day. India was able to drive the British, still a major superpower, out of their lands and affairs by forceful, nonviolent insurrection. Our Transition must strive to be uncompromisingly forceful but also compassionate and always favoring nonviolence over violence. The goal is to create a socio-economic system(s) that is compassionate and empowering to all, that fosters symbiosis and mutuality among mutually respecting individuals and groups, rather than cutthroat competition, predation, and manipulation.