“Within every institution of our civilization, no matter how ugly or corrupt, there is the germ of something beautiful: the same note at a higher octave. Money is no exception. Its original purpose is simply to connect human gifts with human needs, so that we might all live in greater abundance. How instead money has come to generate scarcity rather than abundance, separation rather than connection, is one of the threads of this book.” (pg 10)
Charles Eisenstein writes with a rare clarity. While I don’t subscribe to all his conclusions, his analysis of the current global economy is spot on, and I’ve learnt much from this book about how the current system has developed, why it has enslaved the world to a cycle of near-irreversible self-destructive consumerism and what some of the keys might be to moving on from this current nightmare.
Connecting human gifts with human needs
Eisenstein’s hypothesis is that society did not develop our present money system as a way to facilitate competitive enterprise in the form of barter as such, but to facilitate mutual gift-giving of resources that would be wasted if not shared. In fact there have been societies that have functioned in a much healthier way without life being denominated in terms of money. He says:
“Let me be very naive for a moment so as to reveal this core, this spiritual (if not historical) essence of money. I have something you need, and I wish to give it to you. So I do, and you feel grateful and desire to give something to me in return. But you don’t have anything I need right now. So instead you give me a token of your gratitude—a useless, pretty thing like a wampum necklace or a piece of silver. That token says, “I have met the needs of other people and earned their gratitude.” Later, when I receive a gift from someone else, I give them that token. Gifts can circulate across vast social distances, and I can receive from people to whom I have nothing to give while still fulfilling my desire to act from the gratitude those gifts inspire within me.” (pg 20)
The fact that human gifts and skills are not being well utilised in our highly developed world (most people don’t love the work they must do) and human needs are very largely unmet through a massive polarisation of wealth illustrates that what we have come to now is an absolute failure.
Instead, money has become a way to reduce human life and the natural world into a reductionist, centrally controllable machine-like and decidedly un-sacred place. He says: “…reductionist science seems to rob the world of its sacredness, since everything becomes one or another combination of a handful of generic building blocks. This conception mirrors our economic system, itself consisting mainly of standardized, generic commodities, job descriptions, processes, data, inputs and outputs, and—most generic of all—money, the ultimate abstraction.” (pg 9)
Instead of enabling well-being for society, our economic system has become the tool of crippling the linking of human gifts and human needs. Money as we know it is not the answer, money is actually the problem.
“It is ironic indeed that money, originally a means of connecting gifts with needs, originally an outgrowth of a sacred gift economy, is now precisely what blocks the blossoming of our desire to give, keeping us in deadening jobs out of economic necessity, and forestalling our most generous impulses with the words, “I can’t afford to do that.”” (pg 22)
Reductionism and commodification
As an accountant by training, I know how powerful the story behind our economic system is, and how hard it is to break out of that mindset. We are trained that everything can be expressed by some sort of a monetary value: time, goods, people, resources, land, water, entertainment, culture etc.
When we link this to the other unquestioned assumptions of our age – maximisation of wealth as expressed in possessions and net worth, and the value of individualism, we have a toxic brew for dehumanisation and destruction of the earth.
Eisenstein shows how society has moved progressively from very little being denominated in monetary terms to almost everything. Much of what was once regarded as the commons – the common property of humanity for the good of all – is now private, protected by private ownership, regulation, patent law, digital rights management and so on. This has had the effect of not just separating us from our joint cultural heritage but also of separating us from each other and ultimately from our own worth. In a generic world where everything is exchangeable nothing carries any kind of meaning – including our lives. We see this in western culture where although we have an abundance of stuff we are the most dissatisfied of generations.
“…the products of slave labor embody the spirit that goes into them. Who but a conscript would produce the crappy, dispirited, toxic, ugly, cheap objects and buildings that surround us today? Who but a slave would be so resentful and unpleasant in providing services? The vast majority of our “goods and services” are made by people who only do so for the money, who only do their work because they “have to.” I want to live in a world of beautiful things created by people who love what they do.” (pg 199)
By denominating almost everything in terms of money, we can “own” what was once the possession of all, limit it making it scarce then make a profit. By denominating abundance into money (a scarce commodity) the abundance of the world is withheld from the needy and wasted by the powerful.
“When everything is subject to money, then the scarcity of money makes everything scarce, including the basis of human life and happiness. Such is the life of the slave—one whose actions are compelled by threat to survival. Perhaps the deepest indication of our slavery is the monetization of time.” (pg 31)
The non-organic nature of money
If almost everything is denominated in terms of money, things once intrinsically valuable not only lose meaning and true value, but the status of money is elevated to a higher value than the goods that it is supposed to represent.
Almost everything in the real world decays over time – food, fabrics, timber, manufactured goods, even ideas and culture. They need to be refreshed and nurtured. Even land if left unkept losses some of it’s intrinsic value (an orchard left to become overgrown say). This is why gold was regarded so highly in ancient cultures – it did not rust or decay like everything else.
Money as we know it on the other hand (because it can be loaned at interest) functions in the exact opposite way. It gains value over time. Money, something that has no intrinsic value but is simply supposed to be a way of linking human gifts with human need, has now become something to be desired above all else, to be hoarded rather than used to benefit society.
Eisenstein argues that this is actually not just ridiculous, but it is at the heart of our inequality and what he calls “wealth polarisation“. Those who somehow have money gain more for doing virtually nothing, and those who don’t get worse off. The scarcity of money drives economic slavery.
The problem with interest
“Economic thinkers since the time of Aristotle have recognized the essential problem. Aristotle observed that since money is “barren” (i.e., it does not leave offspring like cattle or wheat do), it is unjust to lend it at interest. The resulting concentration of wealth had been seen many times already by 350 BCE, and it would happen many times thereafter. It happened again in Roman times. As long as the empire was expanding rapidly, acquiring new lands and new tribute, everything worked passably well, and there was no extreme concentration of wealth. It was only when the growth of the empire slowed that concentration of wealth intensified and the once-extensive class of small farmers, the backbone of the legions, entered debt peonage. It was not long before the empire became a slave economy.”
Loaning at interest – the backbone of the modern economy – only works in times where there is room for growth – new lands to conquer, new products to make, new needs to create, new resources to exploit, more gullible people who will believe that they too can be “rich”.
When we start running of out the commons (what is left of our shared culture and our natural world), when we become satiated on the drug of consumerism, when pleasure no longer is pleasurable, the system starts to break down. Then it gets nasty. The economy starts to implode, democracy becomes a commodity for sale to the highest bidder, regulation multiplies so only huge exploitive corporations are able to survive, debt becomes unsustainable, jobs become harder to find and higher-pressure. In the intensity of human suffering violence escalates and the poor and minorities usually become the scapegoats.
No reverse gear
The current system is clearly unsustainable. It is an insatiable beast without the ability to regulate itself.
While Eisenstein offers some great solutions at a macro level which could reverse the process I’m not convinced that without a serious rupture in the current system there will be any appetite for real solutions. Our best hope is to at least aware of the vulnerability of the current economy and not to put our hope in it, but to begin to rebuild an economy of care and generosity that isn’t focussed on or indebted to the money system.
Although the details and timeline of this unraveling are impossible to predict, I think we will first experience persistent deflation, stagnation, and wealth polarization, followed by social unrest, hyperinflation, or currency collapse. At that moment, the alternatives we are exploring today will come into their own, offering an opportunity to build a new and sacred economy. The farther the collapse proceeds, the more attractive the proposals of this book will become. (pg 101)