But what did Henry Adams actually know about money?
Capitalism is a certain mistaken and illiterate understanding of what money itself is and does.
What is missing in the language that many people fail to bring to their presentations on monetary and social reform is this question of exchanging value FOR money. TimeBank and Mutual Credit members already know the reality - that value can only be exchanged for value and that money Is Not value but can only be a representation of the value of other things.
So when the Capitalist talks of bankers or financiers or governments creating money as though their 'unit creation' activity is akin to the genuine economic activity of the laborer or producer, that talk should be met with a challenge of the absolute illiteracy of the capitalist in not knowing the difference between the real value and the unit of abstract representation. The challenge to capitalism is not going to succeed until the very concept of money creation by some specific class or group of people is known to be as illiterate as would be a group that claims to be the Inch Creators or the Gallon Creators and that but for these Magical Unit Creators the poor peasantry would not be able to measure stuff!!
The problem is that once the populace is using this kind of illiterate system the system itself carries imperatives to which the entirety of the populace must respond unless they are willing to abandon the system.
Those imperatives include the monetization of the planet and a never ending scarcity of units that comes from thinking that the units are themselves items of economic value. All very circular but very much like a whirlpool vortex of a lack of mental acuity.
When you study the history of this country you come to know that the original colonists almost broke free from the banking cartel when they issued their own currency in their colonial scrip. It was the imposition of the imperial currency that the colonists were to pay their taxes in that has been the form of imperial control since the days of the Roman Empire. The colonists wanted to pay taxes in their own currency or directly in "in-kind" contributions...Not in the imperial imposed currency.
(As an aside, had they consulted with Native People the colonists would have found them not suffering even from this delusion....but that is another conversation.)
If the American colonists had run their scrip system long enough they would have come to know that the free activity of the populace comes first and the currency is simply a representation of that activity. Franklin himself described the colonial scrip system as being in support of the genuine economic activity. When asked about how he could explain the prosperous condition of the Colonies, Ben Franklin replied:
"That is simple. It is only because in the Colonies we issue our own money. It is called colonial scrip, and we issue it in proper proportion to the demand of trade and industry.” But did Franklin really know that even this "issuance" ahead of activity was exactly backward and against the logic of "free" enterprise? You see, if any "issuing authority" has the power to limit the acCounting units it has the power to control and direct the actual economic activity of the populace. Proof that even Franklin had no real idea of the capacity of the colonists is found in the counterfeit flooding of the colonies that the Crown first attempted thinking that this would crash the colonial economies. In fact, it stimulated these economies! Because the limits of the colonial issuance were actually interfering with the genuine capacity of the colonial people! And this was based on the silly notion that the issuance needed to precede the activity by way of some 'monetary authoritarian power.' Unfortunately this illiterate notion was then enshrined directly into the Constitution.
Based on this unfortunate misunderstanding as to the role of money in a society Hamilton and others destroyed the possibility of getting free (in their time) from the monetary illiteracy of the colonial empire by establishing the very same system of the banking empire right here after the revolution. The Money Masters thing is an accurate enough history. And Bill Still wrote back to me with the response that money should be valueless and ubiquitous. So the question is one of knowing how "free" enterprise and self governance can only be supported when a populace knows that representation of their own activity does not come in the form of 'authoritarian issuance.'
It really comes down to knowing that money serves an after the fact bookkeeping function that is driven not by available units but by the freely chosen activity Of The People. In barter there is no unresolved reciprocation in exchange. But once a group of people desire to hold the resolution of exchange for future reciprocation and decide to use a unit based system of abstract representation for that which will eventually be reciprocated, then they must know going in that the unit of representation cannot ever be confused to be a thing of value all by itself.
So, given that the lessons we almost learned in the colonial period have yet to be learned, what are we to do? One can see that any and all attempts to make the imposed colonial system work For The People have failed. But that is because we have not first abandoned that imposed system and all of its illiterate and unworkable assumptions.
To the present day The People have never yet chosen a fully rational and workable system of unit based abstract representation of their own activity in a truly free social order. We can do that.
I read your essay on the extiction of bison, and how this 'railroaded' various First Nations. Not a word of Greek in it; very readable.
The notion of the "corporate person" - which is bloody abstract - was more puzzling to me (who suffers from the monetary illiteracy mr. Mark Heffernan speaks of? There seems to be a connection - albeit subterraneously, and spanning several decades - with things (or "legal persons"...?) like "Technotronics Inc" in the 1930's (or was it Technocracy Inc?). Maybe that connection is merely evokd by the sort of cartoons such topics elicit?
I think you are on to something about the 'connection' to monetary illiteracy which itself is really (in my conceptual framework) illiteracy about abstract representation........much to flesh out.
After checking out your links and watching a couple of videos, I kept mulling this over last night and I came to the tentative conclusion that money is a commodity, not a unit of measure of value. In other words, money is a commodity that is exchanged for other commodities.
Part of the reason for this is that the actual value of anything is subjective. In the barter system this is obvious: "I'll give you this for that." It's not a matter of the two objects being traded are of equal "value" (a subjective thing; "beauty is in the eye of the beholder"), but instead they have agreed to trade based on whatever is in the mind of each that makes the trade something worth doing, including what may be a genuine generosity and neighborly sentiment.
Though money appears more objective, the decision to exchange paper or coin for goods and services is a subjective decision based on whatever the two parties conceive of as the benefit of the exchange. It doesn't matter that the paper is ultimately valueless, but it is rather what the paper represents to both parties. And this is even true with digital currency. Digital currency, even though lacking physical existence, is a commodity: it is treated as such. The actual value of "possessing" imaginary, in silico coins is in the eye of the beholder, and only the parties involved in the exchange can determine what that means to each.
So, to reiterate, my conclusion is that money is a commodity, not a measure of "value" (a subjective concept).
However, I am still very interested in the subject because if there may be a different way of creating a system of exchange (credits and debits) as you suggest that would be much more efficient and less problematic than our current system and I am eager to see how that may be implemented because there is no doubt that the money problem is at the root of many of the world's evils.
You mention Time Bank and mutual credit. Can you share any links?
the transformation of money as a medium of exchange into a commodity that itself can be exchanged — eg., investing to ‘earn interest’ — is part of the story I think Mark is talking about...
Because "money" has no independent existence, to be anything concrete it must first be defined in a logically consistent fashion and used accordingly. That has never happened in history, instead the notion of money we have is the product of a use of it over a vague colloquial notion of it. This is unacceptable when that colloquial notion is ontologically inconsistent i.e. by conflating two mutually exclusive concepts into one notion. This notion has its origins from before Babylon in two basic forms a commodity being also used as a measure and more recently a mere annotation of value also used as a commodity. See: https://bibocurrency.com/index.php/downloads-2/19-english-root/learn/271-brief-history-of-money-s-misrepresentation
The question remains as to whether people will come to figure out that activity comes first, and abstract representation of it as numerical annotations in books comes after.
Most do not see the contradiction and the problem with the expectation that one must 'possess' units in order to interact?
In the mutual credit/TimeBank (bookkeeping) system no one is left out, no one 'needs' currency. Those who need goods and services may have a 'negative' entry in their acCount, but those who provide those goods and services have positive acCount entries..........and no one is constrained from interaction based on a "shortage" of units or by the whim of the 'money creator.' The community can have a shortage of genuine resources or even energy to "do" (think about weekends and the desire to only 'work' so much). But they can never "run out" of 'money' any more than they can run out of inches or gallons!
Marc Gauvin and Sergio DOMINGUEZ have also presented this:
“The power of transaction type "a" when money is defined as only a passive record of value and not also a token of trade” Marc GAUVIN Sergio DOMINGUEZ, PhD Eng. www.moneytransparency.com
Common every day practices in which money is conceived as both a measure of value and an article of trade of variable value, establish the circular relation where the standard unit of measure of value is also treated like an object of trade subject to “supply” and “circulation" and valued in terms of itself as if it were just another resource. As a standard measure of value it is required for all economic activity to enable the transaction of divisions of otherwise non divisible (non fungible) goods and services. But, as a commodity like resource, it must be supplied prior to any economic activity taking place. As such, it acts as a universal economic enabler and charged for at a per unit cost as if it were another industrial product. Said charges compound across value chain links and reiterations, geometrically inflating overall production costs, independently of any discretely measurable corresponding added value. This leads to a system wide instability, with the principle effect of exacerbating the demand for money beyond any supply, converting it into the most ubiquitous component of economic activity. By virtue of its universal demand, the money system interconnects all economic components into a single system of interdependency on the basis of its supply, over and beyond any non-monetary value of the corresponding goods and services. Because of this unique role as a sine-qua-non universal precursor, agents compete and/or conspire to accumulate positive balances to be exploited as economic leverage in transactions of goods and services, again independently of any non-monetary properties and virtues of these. This tendency to accumulate further exacerbates the system instability. According to fundamental control theory any unstable component of a system destabilises the behaviour of the whole system and ultimately all components are rendered unstable. Therefore it follows that individuals as components of the economy, will have their behaviour perturbed and destabilised leading to increasing otherwise unconscionable (corrupt) behaviour at all levels.
When money is formally defined as solely a record of value and used accordingly, the money system is made Passive and therefore stable, only useful as a (stable) reference of value, required for representing divisions of value of otherwise indivisible goods and services. By virtue of money acting as a stable record/measure of economic activity, it cannot precede transactions and therefore cannot serve as leverage over economic activity. Thus, money only serves to inform control of economic activity without in any way imposing limiting imperatives exogenous to real world activity.
Moreover, of the four transaction type permutations, type A transactions (positive buys from negative) serve to defuse risk in the system by reducing the total value at risk of non reciprocation and since there is no incentive to accumulate balances, there exists no bias towards type D transactions (positive buys from positive). Finally, as a Passive stable system the money system no longer can systemically destabilise (corrupt) the behaviour of its components, including individual agents i.e. you and I. "
Well, changing the money system sounds good to me, but has this "mutual credit/TimeBank (bookkeeping) system" been implemented anywhere? And where does one find out more about it? So far all just theory.
Maybe Marc Gauvin can better explain the math about how these kinds of systems are NOT solutions IF thought to be able to run along side the existing system. The existing system, if left running, will always overtake and push out passive systems like this. Here is a non-math explanation:
Hello Tobin, and thank you for your continued open minded problem solving effort!
The efforts the MSTA has been engaged in have focused on spreading awareness about the misconception/misrepresentation of money first, as this systems science analysis is really quite new. So, the scenario you present about the potential for courts to ignore is surely possible. Just yet we have brought no legal challenges to a court of law anywhere in the world.
But the depth of conversation in this arena is just getting going and spreading. There are so many in fields of analysis that can and will readily grasp the illogic and the violations of basic applied math and the social implications of continuing along this path that the sharing of this information is less daunting than one might think. You see, when people from top to bottom of the economic order are equally affected by the instability inherent in the present illiterate monetary paradigm it becomes more clear to people that continuing along this path will not 'save them.' So complicity starts to become clearly understood to be against self interest.
Additionally, when folk like yourself become aware and share these ideas the 'rate of uptake' increases exponentially. We are gaining in numbers around the world, because the implications for our common misunderstanding are world wide. As these numbers grow and wider and more effective communication and sharing methods come into play the effects will be even greater.
Perhaps you have seen our 'Resolutions' that can be introduced to Any Level and/or Body Of Governance anyplace in the world?
Bringing these resolutions to public bodies around the world brings the topic to world wide public discussion.
The two guys in that first video you posted (of the interview of Marc Gauvin by Liam Murphy) are working on a curriculum to facilitate teaching this information. We have all gone through several levels of investigatory analysis to finally get to the place of understanding that all our problems cannot be attributed simply to 'the bad guys.' (when I read your fist comment on this page saying this same thing it was very powerful!) What we need now to do is collaborate and find ways and additional energies and tools for getting this to a wider audience such that the original internal individual 'push back' against this awareness subsides and more and more can recognize what WE have to do.
To that end I invite you to share and put in energies to hasten the dispersal. All of our abilities to clearly grasp and then clearly present the problem will be critical. Knowing the systemic effects helps one to see how the focus must remain on the system and knowing what the system dynamics are. Many balk at the notion that even 'the bad guys and their behavior' are products of the system. But even the 'bad guys' (except for maybe a select few at the very top) are just as freaked out about system dynamics that they are clearly observing they cannot control, while (maybe) the select few hope the rest don't figure this stuff out.
The awakening is happening around the world within organized and not so organized groups of people, and I am sure that it is true what Victor Hugo said — 'Nothing is more powerful than an idea whose time has come.'
As to your question: "what did Henry Adams actually know about money?” —
You may be confusing Henry Brook Adams (author of “The Education of Henry Adams”) with the Henry Carter Adams I quoted.
Click the link I provided at his name to learn:
"In 1878, Adams became the first [Johns] Hopkins student to receive a Ph.D. for an economics thesis on the history of US taxation. …
"From his dissertation onwards, Henry C. Adams quickly emerged as a prominent public finance economist - his Public Debts (1887) and Science of Finance (1898) becoming textbooks in the field. Although conservative in some respects, Adams parted ways from contemporary American apologists by his criticism of laissez faire, calling for regulation of the railroads and the legalization of trade unions. Jointly with Ely, Adams was one of primary forces behind the creation of the American Economic Association in 1885. His 1887 article on state regulation, contributed as an AEA monograph, was a pioneering classic in the field. He was later elected president of the AEA in 1896.
"Adams was forced out of Cornell in 1887 because of his "radical" opinions (Adams identified his 1886 Scientific American article on labor, an impromptu speech during the heat of the Gould railway strike, as the cause of his dismissal). Adams subsequently became a full professor of political economy and finance at the University of Michigan in 1888, where he remained until his death."
Thank you, Peter, for the detailing of the efforts of Henry C. Adams. But the question remains despite the focus on 'public finance.' Literally, the question remains as to whether people will come to figure out that activity comes first, and abstract representation of it as numerical annotations in books comes after.
I am guessing Adams did not see the contradiction and the problem with the expectation that one must 'possess' units in order to interact?
In the mutual credit/TimeBank (bookkeeping) system no one is left out, no one 'needs' currency. Those who need goods and services may have a 'negative' entry in their acCount, but those who provide those goods and services have positive acCount entries..........and no one is constrained from interaction based on a "shortage" of units or by the whim of the 'money creator.' The community can have a shortage of genuine resources or even energy to "do" (think about weekends and the desire to only 'work' so much). But they can never "run out" of 'money' any more than they can run out of inches or gallons!
Why is it that the anti-war clan NEVER talks about the very structures and illegitimate claims over money creation itself that pay the soldiers!?
The sovereign 'authority' to spend and then tax is a trap by which The People are ensnared into militarism they do not want. An ancient strategy called out by David Graeber in his book "Debt: The First 5000 Years." Simple plan really - government declares its supreme authority to issue currency and first spends it into existence on the military. Then the self proclaimed authoritarian government (same self declared nonsense as the Divine Right Of Kings but disguised under the façade of ‘free and fair elections’) declares that The People must pay a tax with the 'coin of the realm' that the government first spent into existence with the military. (Yes, that very military industrial complex - the MIC - Eisenhower warned against.) And, wham, The People must do business with the MIC.
Historian Michael Parenti: “Imperialism is what empires are all about. Imperialism is what empires do,” as “one country brings to bear…economic and military power upon another country in order to expropriate [its] land, labor, natural resources, capital and markets.” Imperialism ultimately enriches the home country’s dominant class. The process involves “unspeakable repression and state terror,” and must rely repeatedly “upon armed coercion and repression.” The ultimate aim of modern U.S. imperialism is “to make the world safe” for multinational corporations. When discussing imperialism, “the prime unit of analysis should be the economic class rather than the nation-state."
Something Gabbard, and Sanders and others never talks about.
If Gabbard was as courageous as USMC Maj. Gen. Smedley Butler she would be naming names of the bankers and industrialists that are calling the shots from the top and she would be calling out how the imperialist system works with regard to the illegitimate claim over the creation of money – Poof! – by the imperialist to pay soldiers like herself.
The soldiers are the ones at the head of the pay line of the asinine imperialist power structure. Without the soldiers the imperialist has no one to kick ass for them. Everyone, including the soldiers, must come to know that the creation of a unit of account ahead of and apart from the activity that it will represent is irrational and that acceptance of this kind of acCounting token is going along with irrationality.
Imagine what the world will look like when the work of the laborer credits to the proper account. The revolution is not in demanding that some f'ed up Wall Street or World Bank or IMF ‘leaders’ or their bought and paid for politicians behave better - it comes when we know that the money is simply the credit numbers used to represent the the freely initiated doing of the populace within the constraints of the natural world, and No One issues this money or loans these units ahead of and apart from that which they represent!
It is precisely the framework of the operating system of authoritarian control over the creation of the economic unit that precludes democracy. It is my summation that this conclusion could not come to Adams when he had so much "invested" in his career as professor of political economy and finance. Unfortunately for most of the populace, the "training" received leaves them unable to question their own 'education.'
I think Mark Hefferman's point deserves not to be dismissed. While Graeber (and others) have pointed out the problem of debt money, did he/has anyone provided a straightforward way of explaining how this became possible solely because of the invention/confounding of money as a commodity or set forth a way of dealing with the problem? I started looking into it, and I think this is something very real and overlooked. It's not just greed, ill will or scheming (though there is plenty of that too); but there is something more systemic to the problem that won't be solved under the current commodity money paradigm even if everybody had the best of intentions.
Here's an interview with Marc Gauvin who seems (one of?) the first to have realized this blunder under which we have all been laboring. Both he and his interviewer are either lawyers or are legally literate and show how this problem can be tackled.
Hello Tobin, and thank you for that analysis. Remaining objective and providing the 'thoughtful class' a means to define clearly our common inherited illiteracy seems to be as critical to human growth as when the 'educated class' timidly but eventually challenged the geocentric universe espoused by the 'ruling class.'
Yes, I did see that one and just rewatched. Maybe that's the best introductory video.
So what I'm getting is that initially coin money derived from the need for fungible goods (goods divisible into units, usually by weight) that could be traded for other commodities, and while there were many such fungible goods (salt, shells, etc) eventually gold and silver coins became the fungible goods of choice. in this case gold and silver had actual value, but then that value was conflated with a measure of the value of other things. But then promissory notes began to be substituted for actual gold or silver coins, and the printing of notes was subject to corruption, the value of money became unstable. Finally, promissory notes became unredeemable in gold or silver in the 1970s and people lost sight of the fact that they were supposed to promise anything at all.
But this seems an oversimplification. Because actually, it was compounding interests on loans that led to the concentration of power in the hands of a very few.
So imagining we were somehow able to correct the concept of money and come up with a system that was transparent, stable, BIBO and passive, how would that help change the situation with money lending and interest? Or would "money" be something that could be lent at all? I guess I would have trouble continuing to call it money if it were simply a registry of transactions. What kind of changes are we really looking at?
Also, if it were a public registry via computing then it would be susceptible to and taken advantage of by those who like to control everything. So would it really solve anything? Or would it create a worse nightmare?
I had not really thought of the connection between debt and sovereignty. If one were suspicious, one could wonder about a government that eagerly gives away its defining characteristic (in the modern world).
So there is a basic illiteracy that most are holding (because we have been taught BS) when it comes to the thing called money. Now let's look at this situation in the bank issued and controlled system we are presently using. In historical context the guy running the vault (banker) gives the person that puts something in the vault a receipt. The receipt is Representative of something in the vault. The guy running the vault has become the record keeper for the community which trusts that the records are accurate reflections of real stuff. The trading of the receipts are NOT things of value in and of themselves. The receipts are representations of something of real value. The basic concept in this scenario is that receipts are NOTHING if there is nothing that they represent. So if the guy running the vault makes up fake receipts claiming falsely that they represent his own property in the vault (like he did back then and now has that instituted as the system we use today), or if a government declares that it can make up fake receipts and then demand that these get "paid back" both of these are FRAUD.
Markus O'Bryan O'Heffernan Excerpt From: Michael Hudson. “Killing the Host.”
From above: "A society’s analytic concepts determine the kind of reality it creates. That is why parasites start by taking control of their host’s brain. Neoliberal enzymes aim to sedate the industrial host into believing that the financial sector is part of the real economy, not external to it and extractive. That is the first myth."
100% agreed!
The financial world is not only outside of the economy but outside of deductive reasoning. What reasonable sense is there in believing in the creation of the monetary unit apart from ANY economic activity. The belief that anyone can create units apart from something real that they represent (not themselves!) is hard to get people to understand as a misrepresentation of the function of and purpose for the existence of what we call money. But the unit cannot be a tool to report on and/or keep track of economic activity and then claim to be part of the economic activity at the same time!
So, in the world of what we call the economy, all the products and services along with their transaction between folk are tracked/credited/accounted/recorded with accounting units that are also thought to be products all by themselves. The populace has not challenged the illiterate notion that it needs unit creators to conjure up these units - Poof! - with the flick of a pen or the stroke of a key on the keyboard!?? WTF kind of thinking is THAT!? I mean, really, how can an accounting unit also be a product? Why is it that we all think that abstract units of economic measure have to already be in existence as the property of the unit creators before the populace can interact and keep track with the units they then have to rent from the unit creators!?
Then, as if this illiteracy is not enough, we add insult to our own stupidity as we go along with adding in the "cost" of the existence and use of these units to every single transaction along the "value chain" of the real goods and services and wonder why the whole freakin economy is unstable! This is Monetary Illiteracy NOT economic crisis!
No magical entity or power exists such that the Abstract AcCounting Units can be created - Poof! - 'all by themselves' attached to nothing and considered property before they are eventually used/attached/assigned to annotate something of genuine value. How is it that anyone would think that "property" can be created in this fashion and that one can "own" the unit of acCount and legitimately charge for its existence and use. (How many inches or liters or gallons or miles or kilometers do you own!?) The habituation of this kind of thinking is manifest in both the banker fraud of "creating" units of acCount that go onto the books in their own records as both genuine entities of real "value" that are also their own property and "owed" back to themselves! And along with this insanity we throw in additional temporal based fees (interest) for the existence of the units so created until such time as they are "paid back"; and these fees are marching along and compounding (by addition to every transaction along the ‘value chain’) until the very next iteration of this same process starts all over again!
But this is NOT the whole of the problem, because the populace is still stuck with the illegitimate thinking that "the government" (as though it is actually something separate from the populace itself) has this mystical original power to create - Poof! - the unit of acCount by some sort of magical power that entitles government to claim the same kind of asinine 'property rights' over its declared/established currency (that stupid illiterate establishment clause in the Constitution) such that it can both delegate the "creation" process to banks while also retaining some "ownership" claim over the units which it has already declared to be the form in which taxes must be paid! (David Graeber documents the long history of this lunacy in his book Debt: The First 5000 Years) And just like that - Poof! - the populace thinks that abstract acCounting units are things unto themselves that are claimed as property by a government (seemingly separate from the populace) that has exclusive power to both create and collect this "property" as a means to sustain itself as though government is something altogether separate from the populace! And when the focus has shifted in this process from the real contributions (that 'the government' just like any other member of the populace can/could easily acCount for with units of acCount that come into being in book keeping fashion) that a populace can require of itself to sustain itself to this asinine thinking about units of acCount as entities unto themselves that can somehow magically substitute for those real contributions, then the populace has given itself over to abandonment of its own power to any who will take up this power and use it for its own purposes. And ALL of this is based on the illegitimate thinking that an abstract unit of acCount can be, simply on the basis of declaratory assertion by illiterate and mostly illegitimate "leaders", both an abstract economic measure of value and a genuine commodity at one and the same time!!
Thank you again, Peter. To remain diplomatic and focused on long term objectivity maybe we can assess the historical 'drinking of the kool-aid' as having been going on since we abandoned fungible trade goods for abstract representation of value in our record keeping systems. This has been so long standing that we've confused the effects with the cause. And we are ALL participating within the system that from its conceptual base cannot produce anything but more of what we see all around us.
This is what we are passing to all we at the MSTA have conversation with:
Will you support a full objective evaluation of the “money system” from a strict system dynamics perspective?
Please take this into consideration:
1) The money system is a mere component of the economy whose dynamic status can be determined to be either stable (passive or active), unstable (active).
2) Being a purely human construct “money" requires a formal objectively evaluable ontological definition. Yet there is no consensus on what money is.
3) “Money" has been iterated ad hoc over informally assumed notions of it, taken by rote in spite of being ontologically undecidable.
4) How, in the event of constituting an unstable component of the economy, the "money system" produces economic imperatives that destabilise economic components that assume them as requirements.
5) Financial/economic units ($, €, etc..) also lack any formal (decidable) definitions rendering indeterminate any calculations in terms of these units vis-à-vis the “real” economy.
I think such an inquiry is long overdue as it seems evident that money imperatives seem to override most if not all other concerns; and not having independent existence of humans, “money" needs to be fully defined and specified like any other technological device applied to the real world.
Unfortunately, because everyone's survival and hope for individual prosperity as members of society are intertwined with money, when it comes to evaluating it as a mere technology all reason seems to be abandoned by most. Hopefully this will not prove to be the case with your organisation.
--- Marc Gauvin and all the international members/MSTA
Maybe you can consider bringing this to the attention of others?
I do take heart in the work you have done with Native People, because in their traditions we don't find this basic illiteracy about abstract representation of value or even much of the obsession with 'acCounting' as practiced by the colonizers. I hold a certain hope that some large contingent of Native Scientists can help correct the lack of correct use of the colonizers' own 'Applied Math' in monetary systems!
The question remains for humanity to address that if the functional use of money is as an accounting tool that comes in support of our own freely chosen and directed activity (as a record, an annotation of value) and after the doing gets done, then there should be no logical way any people can ‘run out of money.’
How many think there are inch and millimeter and gallon and liter creators?
Yet we think there are money creators!??? WTH!? And this is the 21st century!
Hello and Thank You, Peter, for that piece on how land is being "bought" by the modern day colonizers. I am reminded of the story you have told of the Native Tribe that lost their land because the US said the tribe was "paid" for the land with something supposedly 'of value' that the US government claimed some magical right to 'create'!!
The basis of the entirety of the claims of 'ownership' that capitalist companies (Blackrock & Vanguard, Chinese investment groups, etc. whose owners are not ever disclosed) make is by way of the system of money. In the present system of money the monetary unit magically comes into existence as an act of government - Poof! - or as an act of banking - also Poof! - and every single interchange activity of the people that occurs within this system is thereby subjugated to the banks and/or the government. We saw during the '08 crash (and throughout history) for whom the government would use its illiterate magical powers. And we also saw in that time frame and now how quickly the banks would/will snatch up the 'collateral' in the magical illiterate process called foreclosure. And still we seem to think that the BlackRocks and Vanguards of the world are the problem but that the way we do money itself is ok!? How is it that we do not see the system as having produced the very players that we are now so concerned about? Are we all monetary illiterates? In fact, yes. And THAT must change if this perennial problem is going to finally go extinct.
It is our very conceptual basis of what money is and does that is at the heart of our troubles. We make the mistake of thinking that the unit we use for the Measure Of Value is "value" itself. But how can that be? It cannot. So we keep making the mistake of considering the unit of acCount to also be one of the items of 'value' that we are exchanging without realizing that attaching 'value' to the unit of measure that then fluctuates, systemically and subjectively and exponentially, we destabilize the entirety of all the rest of our transactional experience.
So, when we establish that the origin of the currency unit coming into existence is as a simple function of annotation/bookkeeping of the freely initiated and determined economic enterprise of the populace we free ourselves and our economics from the mistake that currency units/units of acCount can be things of value all by themselves. AND we free ourselves of the BlackRock and Vanguard phenomena.
Just like we do not see a market in inches vs millimeters we also know that there is no magical inch or millimeter creator that must create the units before we can measure the length of things! What we have done in our own governance is establish the specifications for the measurement of length with these unit standards. But we have not yet done so with the unit we are attempting to use as a standard abstract unit of representation of this thing called value.
Money itself must be understood as a unit of measure....and no one 'creates' units for this purpose.....the governance of and by a free populace defines and specifies the reference criteria for the unit so that any and all can freely and reliably use it for the representational purpose it serves. The role of government then is NOT in unit creation (or in handing this illiteracy off to banks/financiers ) but is in regulation and adjudication of the consistent use of this tool across the society. del Mar puts it like this: "When money shall be recognized in the law, when it is defined, when its volume, magnitude, dimensions, limits are set forth as precisely, fixed as unchangeably, and protected as securely from alteration, as are now the dimensions of the yard-stick, the pint-pot, and the pound-weight, then, and then only, will money perfectly resemble other measures; for then only will it become a concrete thing of known dimensions. When this comes to pass, Aristotle's definition of its function will resume its original correctness, and money will be as fit in fact, as it is now only in theory, to measure the relation called value." Alexander del Mar, The Science of Money (1885)
Marc Gauvin points out that a valid definition that is unequivocal is missing so far in human history. Former President of the FR Bank in Minnesota, Kocherlakota, proves the current definitions to be "vacuous" and asserts that the function of money is as a unit of measure/bookkeeping.
In Kocherlakota's words:
“My argument demonstrates the vacuity of the three standard explanations of the role of fiat money in an economy: money acts as a store of value, a medium of exchange, and a unit of account....The traditional explanations for the presence of money in an economy are more descriptive of its functions than explanatory. The true explanation for money’s presence is that money is a record-keeping device.”
So, you can see that at the core conceptual level of thinking about money we still have to get the concepts right in order that the system can actually serve its functional purpose. When we have the courage to correct this basic error the populace can free itself from its past and enter into a new paradigm.
Crowfoot stood and watched as the white man spread many one dollar bills on the ground.
“This is what the white man trades with; this is his buffalo robe. Just as you trade skins, we trade with these pieces of paper.”
When the white chief had laid all his money on the ground and shown how much he would give if the Indians would sign a treaty, Crowfoot took a handful of clay, made a ball out of it and put it on the fire.
It did not crack.
Then he said to the white man, Now put your money on the fire and see if it will last as long as the clay.
The white man said, No….my money will burn because it is made of paper.
With an amused gleam in his eyes the old chief said, Oh, your money is not as good as our land, is it?
The wind will blow it away; the fire will burn it; water will rot it. But nothing will destroy our land.
You don’t make a very good trade.
Then with a smile, Crowfoot picked up a handful of sand from the river bank, handed it to the white man and said, You count the grains of sand in that while I count the money you give for the land.
The white man said, I would not live long enough to count this, but you can count the money in a few minutes.
Very well, said the wise Crowfoot, our land is more valuable than your money. It will last forever.
It will not perish as long as the sun shines and the water flows, and through all the years it will give life to men and animals, and therefore we cannot sell the land.
It was put there by the Great Spirit and we cannot sell it because it does not really belong to us.
You can count your money and burn it with a nod of a buffalo’s head, but only the Great Spirit can count the grains of sand and the blades of grass on these plains.
As a present we will give you anything you can take with you, but we cannot give you the land.”
Brett Reginald Scott tells us what many have (Graeber, Douthwaite, Forstater, and others), that present money systems are not a natural phenomena.
"To escape solutionist accounts, you have to accept the possibility that money was introduced into a world where there was no intrinsic or systemic ‘demand’ for it (much like my body has no demand for cigarettes in a world where I’ve never encountered them). From this perspective, the history of money is a series of political-economic events where people who didn’t rely on money slowly took little puffs on it in limited situations - the monetary equivalent of ‘social smoking’ - or were forced into it through acts of political coercion. This sets off a shift, then a slippage that becomes a landslide. Resistance to dependence on money erodes, then collapses, locking the society in.
As any economic anthropologist knows, there are many ways that pre-capitalist societies collaborated for survival, using combinations of logics and practices that ranged from informal reciprocity, gift-exchange systems, hierarchal redistribution, patronage systems, and small-scale communism alongside forms of commercial exchange. As I discuss in my video and article on Tabu ‘shell money’ in Papua New Guinea, many pre-capitalist ‘currencies’ were not commercial in nature, and were only used in ritualistic settings to mediate social relations and power.
The capitalist money that we’re used to, however, is inherently linked to the rise of states, imperialism and colonial conquest. This is not the place to recount that history, but - in highly stylized terms - political actors introduce credit systems, forms of coinage, and tribute systems that gradually snowball into larger systems. Money acts as a dissolution agent, dissolving situations of small-scale interdependence and recombining them into large-scale interdependence. It transforms smaller discrete economies into larger integrated ones.
For the groups on the left of the picture above, money might once have had some optional element to it. For example, in my homeland of South Africa in the 1800s, Zulu, Xhosa and other groups held onto traditional subsistence systems that enabled them to live outside the colonial market economy, while occasionally dabbling in those markets. This slowly changed, however, as the colonial government forced them to pay ‘hut taxes’ that required them to work in mines to get the colonial money needed to pay the tax. This is spelled out in the 1893 report about the ‘native labour question’ by the Committee of the Mine Managers Association : “It is suggested to raise the Hut Tax to such an amount that more natives will be induced to seek work, and especially by making this tax payable in coins only”.
The word ‘induced’ is telling. It suggests a process of trying to artificially stimulate demand for something that isn’t intrinsically demanded. This is the early stage of proletarianization, the process by which people are severed from a previous means of survival and integrated into a new one - wage labour."
The word 'induced' also speaks to the question of liberty while still using these systems of colonial money. As various local imperial powers imposed their colonial currencies on the local populace the system spread world wide. But now we are told that there are legitimate differences between the 'values' of these imposed currencies! Picking sides within the illiterate context of 'national currencies', and illiterate fear mongering about the consequences of these ancient struggles about who's imperially 'issued' currencies hold 'more value', will not address or correct the present, and ages old, mistaken paradigm.
Those numbers are like a Burger King Big Whopper. i don't know how much directly connected with WW I, but the Federal Reserve was created December 23, 1913. Of what little i know, the Fed Reserve prints money then the government gets, with interest, so there's debt built into the system.
In fact, funding WWI and WWII was ONE OF THE MAJOR REASONS the international bankers set up the Federal Reserve to begin with. It was all in the cards.
According to Google (someone fact check?) the US GDP is now $27 trillion while the National Debt is $35 trillion. So our debt is 1.3 years worth of GDP. This is high but I remember it being higher at times in the last 20 years. This might be a fruitful way to assess progress or backsliding.
The CIA WorldFactBook page (! they’ve got their fingers in every pie and hands on every lever!) says:
"United States
110.39% of GDP (2022 est.)"
The GAO says:
This year’s report shows the federal budget deficit in fiscal year 2023 to be $1.7 trillion. This deficit is due to a $1 trillion gap in what the government collected and what it spent. It also reflects the $659 billion in interest paid on total federal debt—up from $352 billion just two years ago.
GAO’s projects that debt held by the public as a share of the economy will more than double over the next 30 years and will grow faster than the economy over the long term if current revenue and spending policies are not changed. This outlook is consistent with projections from the Congressional Budget Office and the Office of Management and Budget and Department of the Treasury. Interest paid to service the total federal debt also grew this year and is expected to steadily increase. This will lead to higher borrowing costs as overall debt increases and interest rates rise.
This unsustainable long-term fiscal path poses serious economic, security, and social challenge….”
I think we need to distinguish certain things in analysing money system issues:
1) The nature of a system: Any system s either passive or active, stable or unstable. Passive systems are by definition stable, if a system is active it can be either stable or unstable. If a system is active then it will influence its environment i.e. will issue imperatives to its environment in order for it to continue functioning. If it is active but stable those imperatives will be "bounded" while if active unstable they imperatives will be unbounded.
2) Behaviour of system components either conform to the system nature or they expressly act to change the system's nature. So the nature of a given system A is not altered by its components unless those components expressly act i.e. to transform A to say system B i.e. the components are non conformant to A, giving way to a completely new system. Note, such a transformation can take place by simply modifying a single parameter. E.g. remove vitamin C from a body and the bodies ability to produce collagen will cease leading to failure of a body tissues leading to simultaneous failure of all critical systems, this is called scurvy. The cure if given soon enough consists of simply adding vitamin. So stable body system A is transformed into unstable body B and back by virtue of a single parameter vitamin C.
3: Unstable systems by their very nature either destabilise their environment or are cancelled, this is another way of saying instability cannot persist indefinitely.
4) There are two categories of systems human and non-human natural systems. Human systems operate wholly according to human criteria - definitions and specifications that are either coherent or not with respect to some or other "purpose" of "function" determined by humans alone. Non human systems are determined by the nature of "reality" in which all human systems and devices are produced. The important take home is that human systems are fully determinable by humans while natural systems are not.
Applying the above elementary system dynamics facts to "money" and in order to deal with all related issues in terms of system dynamics, we need to deeply consider the following points:
1) The money system is a mere component of the economy, whose dynamic status can be determined to be either stable (passive or active), unstable (active).
2) Being a purely human construct, “money" requires a formal objectively evaluable ontological definition. Yet there is no (coherent) consensus on what money is.
3) “Money" has been iterated ad hoc over informally assumed notions of it, taken by rote in spite of being ontologically undecidable (conflating the concepts of measure and commodity like tradable artefact without noticing how/when these notions are mutually exclusive).
4) How, in the event of constituting an unstable component of the economy, the "money system" produces economic imperatives that destabilise economic components that assume them as requirements.
5) Financial/economic units ($, €, etc..) (used to denominate “money" also lack any formal (decidable) definitions, rendering indeterminate any calculations in terms of these units vis-à-vis the “real” economy.
Why use system dynamics and not economic or finance theory? Because system dynamics constitutes a common (objective) framework for determining "reality" that is amiss in economic theory. That is to say, most all if not all economic and finance theories share no common framework to evaluate themselves against each other, what they do instead is to treat "money" as if it were of independent nature that we must simply adapt to its imperatives and never question as "no one yet understands its nature fully". This of course is nonsense, we created the thing and can modify as we wish and need to, for which economic and finance theory currently lack the requisite curriculum of knowledge to even approach any system definition and specification endeavour.
"...But demand has come to be conventionally represented by money; this is why money is called nomisma （customary currency）, because it does not exist by nature but by custom （nomos）, and can be altered and rendered useless7 at will. [12] " - Aristotle, Nicomachean Ethics 5.5
You must be an excellent teacher, Peter - presenting "boring stuff" in a vibrant, relevant way.
Indeed. A nice brief treatise on a complex subject, making it easy to understand! Thanks, Peter.
But what did Henry Adams actually know about money?
Capitalism is a certain mistaken and illiterate understanding of what money itself is and does.
What is missing in the language that many people fail to bring to their presentations on monetary and social reform is this question of exchanging value FOR money. TimeBank and Mutual Credit members already know the reality - that value can only be exchanged for value and that money Is Not value but can only be a representation of the value of other things.
So when the Capitalist talks of bankers or financiers or governments creating money as though their 'unit creation' activity is akin to the genuine economic activity of the laborer or producer, that talk should be met with a challenge of the absolute illiteracy of the capitalist in not knowing the difference between the real value and the unit of abstract representation. The challenge to capitalism is not going to succeed until the very concept of money creation by some specific class or group of people is known to be as illiterate as would be a group that claims to be the Inch Creators or the Gallon Creators and that but for these Magical Unit Creators the poor peasantry would not be able to measure stuff!!
The problem is that once the populace is using this kind of illiterate system the system itself carries imperatives to which the entirety of the populace must respond unless they are willing to abandon the system.
Those imperatives include the monetization of the planet and a never ending scarcity of units that comes from thinking that the units are themselves items of economic value. All very circular but very much like a whirlpool vortex of a lack of mental acuity.
Let's End Monetary Illiteracy!
https://www.moneytransparency.com/msta-resolutions
When you study the history of this country you come to know that the original colonists almost broke free from the banking cartel when they issued their own currency in their colonial scrip. It was the imposition of the imperial currency that the colonists were to pay their taxes in that has been the form of imperial control since the days of the Roman Empire. The colonists wanted to pay taxes in their own currency or directly in "in-kind" contributions...Not in the imperial imposed currency.
(As an aside, had they consulted with Native People the colonists would have found them not suffering even from this delusion....but that is another conversation.)
If the American colonists had run their scrip system long enough they would have come to know that the free activity of the populace comes first and the currency is simply a representation of that activity. Franklin himself described the colonial scrip system as being in support of the genuine economic activity. When asked about how he could explain the prosperous condition of the Colonies, Ben Franklin replied:
"That is simple. It is only because in the Colonies we issue our own money. It is called colonial scrip, and we issue it in proper proportion to the demand of trade and industry.” But did Franklin really know that even this "issuance" ahead of activity was exactly backward and against the logic of "free" enterprise? You see, if any "issuing authority" has the power to limit the acCounting units it has the power to control and direct the actual economic activity of the populace. Proof that even Franklin had no real idea of the capacity of the colonists is found in the counterfeit flooding of the colonies that the Crown first attempted thinking that this would crash the colonial economies. In fact, it stimulated these economies! Because the limits of the colonial issuance were actually interfering with the genuine capacity of the colonial people! And this was based on the silly notion that the issuance needed to precede the activity by way of some 'monetary authoritarian power.' Unfortunately this illiterate notion was then enshrined directly into the Constitution.
Based on this unfortunate misunderstanding as to the role of money in a society Hamilton and others destroyed the possibility of getting free (in their time) from the monetary illiteracy of the colonial empire by establishing the very same system of the banking empire right here after the revolution. The Money Masters thing is an accurate enough history. And Bill Still wrote back to me with the response that money should be valueless and ubiquitous. So the question is one of knowing how "free" enterprise and self governance can only be supported when a populace knows that representation of their own activity does not come in the form of 'authoritarian issuance.'
It really comes down to knowing that money serves an after the fact bookkeeping function that is driven not by available units but by the freely chosen activity Of The People. In barter there is no unresolved reciprocation in exchange. But once a group of people desire to hold the resolution of exchange for future reciprocation and decide to use a unit based system of abstract representation for that which will eventually be reciprocated, then they must know going in that the unit of representation cannot ever be confused to be a thing of value all by itself.
So, given that the lessons we almost learned in the colonial period have yet to be learned, what are we to do? One can see that any and all attempts to make the imposed colonial system work For The People have failed. But that is because we have not first abandoned that imposed system and all of its illiterate and unworkable assumptions.
To the present day The People have never yet chosen a fully rational and workable system of unit based abstract representation of their own activity in a truly free social order. We can do that.
Please read and add to monetary and 'financial' discussions. https://www.bibocurrency.com/index.php/downloads-2/19-english-root/learn/300-you-have-been-served
I read your essay on the extiction of bison, and how this 'railroaded' various First Nations. Not a word of Greek in it; very readable.
The notion of the "corporate person" - which is bloody abstract - was more puzzling to me (who suffers from the monetary illiteracy mr. Mark Heffernan speaks of? There seems to be a connection - albeit subterraneously, and spanning several decades - with things (or "legal persons"...?) like "Technotronics Inc" in the 1930's (or was it Technocracy Inc?). Maybe that connection is merely evokd by the sort of cartoons such topics elicit?
I have listened to two legal eagle presenters that tell this history about how we got to 'corporate personhood.' https://celdf.org/wp-content/uploads/2015/08/Corporate-Rights-bestowal-chronology.pdf
I think you are on to something about the 'connection' to monetary illiteracy which itself is really (in my conceptual framework) illiteracy about abstract representation........much to flesh out.
and this:
https://nancho.net/corperson/timelin2.pdf
Timeline of Personhood Rights and Powers
Women’s International League for Peace and Freedom
Thank you.
After checking out your links and watching a couple of videos, I kept mulling this over last night and I came to the tentative conclusion that money is a commodity, not a unit of measure of value. In other words, money is a commodity that is exchanged for other commodities.
Part of the reason for this is that the actual value of anything is subjective. In the barter system this is obvious: "I'll give you this for that." It's not a matter of the two objects being traded are of equal "value" (a subjective thing; "beauty is in the eye of the beholder"), but instead they have agreed to trade based on whatever is in the mind of each that makes the trade something worth doing, including what may be a genuine generosity and neighborly sentiment.
Though money appears more objective, the decision to exchange paper or coin for goods and services is a subjective decision based on whatever the two parties conceive of as the benefit of the exchange. It doesn't matter that the paper is ultimately valueless, but it is rather what the paper represents to both parties. And this is even true with digital currency. Digital currency, even though lacking physical existence, is a commodity: it is treated as such. The actual value of "possessing" imaginary, in silico coins is in the eye of the beholder, and only the parties involved in the exchange can determine what that means to each.
So, to reiterate, my conclusion is that money is a commodity, not a measure of "value" (a subjective concept).
However, I am still very interested in the subject because if there may be a different way of creating a system of exchange (credits and debits) as you suggest that would be much more efficient and less problematic than our current system and I am eager to see how that may be implemented because there is no doubt that the money problem is at the root of many of the world's evils.
You mention Time Bank and mutual credit. Can you share any links?
the transformation of money as a medium of exchange into a commodity that itself can be exchanged — eg., investing to ‘earn interest’ — is part of the story I think Mark is talking about...
Because "money" has no independent existence, to be anything concrete it must first be defined in a logically consistent fashion and used accordingly. That has never happened in history, instead the notion of money we have is the product of a use of it over a vague colloquial notion of it. This is unacceptable when that colloquial notion is ontologically inconsistent i.e. by conflating two mutually exclusive concepts into one notion. This notion has its origins from before Babylon in two basic forms a commodity being also used as a measure and more recently a mere annotation of value also used as a commodity. See: https://bibocurrency.com/index.php/downloads-2/19-english-root/learn/271-brief-history-of-money-s-misrepresentation
Note a mere annotation cannot be a "commodity" because it has none of the properties of commodities see: https://bibocurrency.com/index.php/full-intro-2/19-english-root/learn/196-money-commodity-or-measure#notastore
Thanks Gauvin. For me, your Brief History of Money's Misinterpretation was the most helpful. I'm still trying to wrap my head around it all.
The question remains as to whether people will come to figure out that activity comes first, and abstract representation of it as numerical annotations in books comes after.
Most do not see the contradiction and the problem with the expectation that one must 'possess' units in order to interact?
In the mutual credit/TimeBank (bookkeeping) system no one is left out, no one 'needs' currency. Those who need goods and services may have a 'negative' entry in their acCount, but those who provide those goods and services have positive acCount entries..........and no one is constrained from interaction based on a "shortage" of units or by the whim of the 'money creator.' The community can have a shortage of genuine resources or even energy to "do" (think about weekends and the desire to only 'work' so much). But they can never "run out" of 'money' any more than they can run out of inches or gallons!
Marc Gauvin and Sergio DOMINGUEZ have also presented this:
“The power of transaction type "a" when money is defined as only a passive record of value and not also a token of trade” Marc GAUVIN Sergio DOMINGUEZ, PhD Eng. www.moneytransparency.com
https://mrcenter.info/Doc/ConferencePapers/2020/The%20power%20of%20transaction%20type%20a%20when%20money%20is%20defined%20as%20only%20a%20passive%20record%20of%20value%20and%20not%20also%20a%20token%20of%20trade.pdf
"Conclusion:
Common every day practices in which money is conceived as both a measure of value and an article of trade of variable value, establish the circular relation where the standard unit of measure of value is also treated like an object of trade subject to “supply” and “circulation" and valued in terms of itself as if it were just another resource. As a standard measure of value it is required for all economic activity to enable the transaction of divisions of otherwise non divisible (non fungible) goods and services. But, as a commodity like resource, it must be supplied prior to any economic activity taking place. As such, it acts as a universal economic enabler and charged for at a per unit cost as if it were another industrial product. Said charges compound across value chain links and reiterations, geometrically inflating overall production costs, independently of any discretely measurable corresponding added value. This leads to a system wide instability, with the principle effect of exacerbating the demand for money beyond any supply, converting it into the most ubiquitous component of economic activity. By virtue of its universal demand, the money system interconnects all economic components into a single system of interdependency on the basis of its supply, over and beyond any non-monetary value of the corresponding goods and services. Because of this unique role as a sine-qua-non universal precursor, agents compete and/or conspire to accumulate positive balances to be exploited as economic leverage in transactions of goods and services, again independently of any non-monetary properties and virtues of these. This tendency to accumulate further exacerbates the system instability. According to fundamental control theory any unstable component of a system destabilises the behaviour of the whole system and ultimately all components are rendered unstable. Therefore it follows that individuals as components of the economy, will have their behaviour perturbed and destabilised leading to increasing otherwise unconscionable (corrupt) behaviour at all levels.
When money is formally defined as solely a record of value and used accordingly, the money system is made Passive and therefore stable, only useful as a (stable) reference of value, required for representing divisions of value of otherwise indivisible goods and services. By virtue of money acting as a stable record/measure of economic activity, it cannot precede transactions and therefore cannot serve as leverage over economic activity. Thus, money only serves to inform control of economic activity without in any way imposing limiting imperatives exogenous to real world activity.
Moreover, of the four transaction type permutations, type A transactions (positive buys from negative) serve to defuse risk in the system by reducing the total value at risk of non reciprocation and since there is no incentive to accumulate balances, there exists no bias towards type D transactions (positive buys from positive). Finally, as a Passive stable system the money system no longer can systemically destabilise (corrupt) the behaviour of its components, including individual agents i.e. you and I. "
Well, changing the money system sounds good to me, but has this "mutual credit/TimeBank (bookkeeping) system" been implemented anywhere? And where does one find out more about it? So far all just theory.
Hello Tobin.
Some links here
https://www.hourworld.org/
https://en.wikipedia.org/wiki/Time-based_currency
https://timebanks.org/
Maybe Marc Gauvin can better explain the math about how these kinds of systems are NOT solutions IF thought to be able to run along side the existing system. The existing system, if left running, will always overtake and push out passive systems like this. Here is a non-math explanation:
https://www.bibocurrency.com/index.php/downloads-2/19-english-root/learn/296-raging-inferno-analogy
The point made by Gauvin about the raging fire is a perfect analogy. But what do we do about it?
The only thing I've seen him suggest is to challenge the unclear meaning of money in a court case where a money contract is involved.
https://m.youtube.com/watch?v=vVTKs-04nAU
I think that interview is a couple years old. Any developments?
Is that the best/only option for challenging the current system?
What if the complicit courts simply ignore the challenge?
Hello Tobin, and thank you for your continued open minded problem solving effort!
The efforts the MSTA has been engaged in have focused on spreading awareness about the misconception/misrepresentation of money first, as this systems science analysis is really quite new. So, the scenario you present about the potential for courts to ignore is surely possible. Just yet we have brought no legal challenges to a court of law anywhere in the world.
But the depth of conversation in this arena is just getting going and spreading. There are so many in fields of analysis that can and will readily grasp the illogic and the violations of basic applied math and the social implications of continuing along this path that the sharing of this information is less daunting than one might think. You see, when people from top to bottom of the economic order are equally affected by the instability inherent in the present illiterate monetary paradigm it becomes more clear to people that continuing along this path will not 'save them.' So complicity starts to become clearly understood to be against self interest.
Additionally, when folk like yourself become aware and share these ideas the 'rate of uptake' increases exponentially. We are gaining in numbers around the world, because the implications for our common misunderstanding are world wide. As these numbers grow and wider and more effective communication and sharing methods come into play the effects will be even greater.
Perhaps you have seen our 'Resolutions' that can be introduced to Any Level and/or Body Of Governance anyplace in the world?
https://www.moneytransparency.com/msta-resolutions
Bringing these resolutions to public bodies around the world brings the topic to world wide public discussion.
The two guys in that first video you posted (of the interview of Marc Gauvin by Liam Murphy) are working on a curriculum to facilitate teaching this information. We have all gone through several levels of investigatory analysis to finally get to the place of understanding that all our problems cannot be attributed simply to 'the bad guys.' (when I read your fist comment on this page saying this same thing it was very powerful!) What we need now to do is collaborate and find ways and additional energies and tools for getting this to a wider audience such that the original internal individual 'push back' against this awareness subsides and more and more can recognize what WE have to do.
To that end I invite you to share and put in energies to hasten the dispersal. All of our abilities to clearly grasp and then clearly present the problem will be critical. Knowing the systemic effects helps one to see how the focus must remain on the system and knowing what the system dynamics are. Many balk at the notion that even 'the bad guys and their behavior' are products of the system. But even the 'bad guys' (except for maybe a select few at the very top) are just as freaked out about system dynamics that they are clearly observing they cannot control, while (maybe) the select few hope the rest don't figure this stuff out.
The awakening is happening around the world within organized and not so organized groups of people, and I am sure that it is true what Victor Hugo said — 'Nothing is more powerful than an idea whose time has come.'
Thanks for your discussion and links…
As to your question: "what did Henry Adams actually know about money?” —
You may be confusing Henry Brook Adams (author of “The Education of Henry Adams”) with the Henry Carter Adams I quoted.
Click the link I provided at his name to learn:
"In 1878, Adams became the first [Johns] Hopkins student to receive a Ph.D. for an economics thesis on the history of US taxation. …
"From his dissertation onwards, Henry C. Adams quickly emerged as a prominent public finance economist - his Public Debts (1887) and Science of Finance (1898) becoming textbooks in the field. Although conservative in some respects, Adams parted ways from contemporary American apologists by his criticism of laissez faire, calling for regulation of the railroads and the legalization of trade unions. Jointly with Ely, Adams was one of primary forces behind the creation of the American Economic Association in 1885. His 1887 article on state regulation, contributed as an AEA monograph, was a pioneering classic in the field. He was later elected president of the AEA in 1896.
"Adams was forced out of Cornell in 1887 because of his "radical" opinions (Adams identified his 1886 Scientific American article on labor, an impromptu speech during the heat of the Gould railway strike, as the cause of his dismissal). Adams subsequently became a full professor of political economy and finance at the University of Michigan in 1888, where he remained until his death."
Thank you, Peter, for the detailing of the efforts of Henry C. Adams. But the question remains despite the focus on 'public finance.' Literally, the question remains as to whether people will come to figure out that activity comes first, and abstract representation of it as numerical annotations in books comes after.
I am guessing Adams did not see the contradiction and the problem with the expectation that one must 'possess' units in order to interact?
In the mutual credit/TimeBank (bookkeeping) system no one is left out, no one 'needs' currency. Those who need goods and services may have a 'negative' entry in their acCount, but those who provide those goods and services have positive acCount entries..........and no one is constrained from interaction based on a "shortage" of units or by the whim of the 'money creator.' The community can have a shortage of genuine resources or even energy to "do" (think about weekends and the desire to only 'work' so much). But they can never "run out" of 'money' any more than they can run out of inches or gallons!
Why is it that the anti-war clan NEVER talks about the very structures and illegitimate claims over money creation itself that pay the soldiers!?
The sovereign 'authority' to spend and then tax is a trap by which The People are ensnared into militarism they do not want. An ancient strategy called out by David Graeber in his book "Debt: The First 5000 Years." Simple plan really - government declares its supreme authority to issue currency and first spends it into existence on the military. Then the self proclaimed authoritarian government (same self declared nonsense as the Divine Right Of Kings but disguised under the façade of ‘free and fair elections’) declares that The People must pay a tax with the 'coin of the realm' that the government first spent into existence with the military. (Yes, that very military industrial complex - the MIC - Eisenhower warned against.) And, wham, The People must do business with the MIC.
Historian Michael Parenti: “Imperialism is what empires are all about. Imperialism is what empires do,” as “one country brings to bear…economic and military power upon another country in order to expropriate [its] land, labor, natural resources, capital and markets.” Imperialism ultimately enriches the home country’s dominant class. The process involves “unspeakable repression and state terror,” and must rely repeatedly “upon armed coercion and repression.” The ultimate aim of modern U.S. imperialism is “to make the world safe” for multinational corporations. When discussing imperialism, “the prime unit of analysis should be the economic class rather than the nation-state."
Something Gabbard, and Sanders and others never talks about.
If Gabbard was as courageous as USMC Maj. Gen. Smedley Butler she would be naming names of the bankers and industrialists that are calling the shots from the top and she would be calling out how the imperialist system works with regard to the illegitimate claim over the creation of money – Poof! – by the imperialist to pay soldiers like herself.
The soldiers are the ones at the head of the pay line of the asinine imperialist power structure. Without the soldiers the imperialist has no one to kick ass for them. Everyone, including the soldiers, must come to know that the creation of a unit of account ahead of and apart from the activity that it will represent is irrational and that acceptance of this kind of acCounting token is going along with irrationality.
Imagine what the world will look like when the work of the laborer credits to the proper account. The revolution is not in demanding that some f'ed up Wall Street or World Bank or IMF ‘leaders’ or their bought and paid for politicians behave better - it comes when we know that the money is simply the credit numbers used to represent the the freely initiated doing of the populace within the constraints of the natural world, and No One issues this money or loans these units ahead of and apart from that which they represent!
It is precisely the framework of the operating system of authoritarian control over the creation of the economic unit that precludes democracy. It is my summation that this conclusion could not come to Adams when he had so much "invested" in his career as professor of political economy and finance. Unfortunately for most of the populace, the "training" received leaves them unable to question their own 'education.'
thanks for the Graeber reference…
I think Mark Hefferman's point deserves not to be dismissed. While Graeber (and others) have pointed out the problem of debt money, did he/has anyone provided a straightforward way of explaining how this became possible solely because of the invention/confounding of money as a commodity or set forth a way of dealing with the problem? I started looking into it, and I think this is something very real and overlooked. It's not just greed, ill will or scheming (though there is plenty of that too); but there is something more systemic to the problem that won't be solved under the current commodity money paradigm even if everybody had the best of intentions.
Here's an interview with Marc Gauvin who seems (one of?) the first to have realized this blunder under which we have all been laboring. Both he and his interviewer are either lawyers or are legally literate and show how this problem can be tackled.
https://m.youtube.com/watch?v=vVTKs-04nAU
Hello Tobin, and thank you for that analysis. Remaining objective and providing the 'thoughtful class' a means to define clearly our common inherited illiteracy seems to be as critical to human growth as when the 'educated class' timidly but eventually challenged the geocentric universe espoused by the 'ruling class.'
Maybe you have seen this?
https://www.youtube.com/watch?v=R3oP2-jh8H0
Yes, I did see that one and just rewatched. Maybe that's the best introductory video.
So what I'm getting is that initially coin money derived from the need for fungible goods (goods divisible into units, usually by weight) that could be traded for other commodities, and while there were many such fungible goods (salt, shells, etc) eventually gold and silver coins became the fungible goods of choice. in this case gold and silver had actual value, but then that value was conflated with a measure of the value of other things. But then promissory notes began to be substituted for actual gold or silver coins, and the printing of notes was subject to corruption, the value of money became unstable. Finally, promissory notes became unredeemable in gold or silver in the 1970s and people lost sight of the fact that they were supposed to promise anything at all.
But this seems an oversimplification. Because actually, it was compounding interests on loans that led to the concentration of power in the hands of a very few.
So imagining we were somehow able to correct the concept of money and come up with a system that was transparent, stable, BIBO and passive, how would that help change the situation with money lending and interest? Or would "money" be something that could be lent at all? I guess I would have trouble continuing to call it money if it were simply a registry of transactions. What kind of changes are we really looking at?
Also, if it were a public registry via computing then it would be susceptible to and taken advantage of by those who like to control everything. So would it really solve anything? Or would it create a worse nightmare?
I had not really thought of the connection between debt and sovereignty. If one were suspicious, one could wonder about a government that eagerly gives away its defining characteristic (in the modern world).
I think the kings thought of themselves as exercising sovereignty by indebting the country. Who else could do that?
So there is a basic illiteracy that most are holding (because we have been taught BS) when it comes to the thing called money. Now let's look at this situation in the bank issued and controlled system we are presently using. In historical context the guy running the vault (banker) gives the person that puts something in the vault a receipt. The receipt is Representative of something in the vault. The guy running the vault has become the record keeper for the community which trusts that the records are accurate reflections of real stuff. The trading of the receipts are NOT things of value in and of themselves. The receipts are representations of something of real value. The basic concept in this scenario is that receipts are NOTHING if there is nothing that they represent. So if the guy running the vault makes up fake receipts claiming falsely that they represent his own property in the vault (like he did back then and now has that instituted as the system we use today), or if a government declares that it can make up fake receipts and then demand that these get "paid back" both of these are FRAUD.
Markus O'Bryan O'Heffernan Excerpt From: Michael Hudson. “Killing the Host.”
From above: "A society’s analytic concepts determine the kind of reality it creates. That is why parasites start by taking control of their host’s brain. Neoliberal enzymes aim to sedate the industrial host into believing that the financial sector is part of the real economy, not external to it and extractive. That is the first myth."
100% agreed!
The financial world is not only outside of the economy but outside of deductive reasoning. What reasonable sense is there in believing in the creation of the monetary unit apart from ANY economic activity. The belief that anyone can create units apart from something real that they represent (not themselves!) is hard to get people to understand as a misrepresentation of the function of and purpose for the existence of what we call money. But the unit cannot be a tool to report on and/or keep track of economic activity and then claim to be part of the economic activity at the same time!
https://wiki.p2pfoundation.net/Money_Should_Not_Be_a...
So, in the world of what we call the economy, all the products and services along with their transaction between folk are tracked/credited/accounted/recorded with accounting units that are also thought to be products all by themselves. The populace has not challenged the illiterate notion that it needs unit creators to conjure up these units - Poof! - with the flick of a pen or the stroke of a key on the keyboard!?? WTF kind of thinking is THAT!? I mean, really, how can an accounting unit also be a product? Why is it that we all think that abstract units of economic measure have to already be in existence as the property of the unit creators before the populace can interact and keep track with the units they then have to rent from the unit creators!?
Then, as if this illiteracy is not enough, we add insult to our own stupidity as we go along with adding in the "cost" of the existence and use of these units to every single transaction along the "value chain" of the real goods and services and wonder why the whole freakin economy is unstable! This is Monetary Illiteracy NOT economic crisis!
No magical entity or power exists such that the Abstract AcCounting Units can be created - Poof! - 'all by themselves' attached to nothing and considered property before they are eventually used/attached/assigned to annotate something of genuine value. How is it that anyone would think that "property" can be created in this fashion and that one can "own" the unit of acCount and legitimately charge for its existence and use. (How many inches or liters or gallons or miles or kilometers do you own!?) The habituation of this kind of thinking is manifest in both the banker fraud of "creating" units of acCount that go onto the books in their own records as both genuine entities of real "value" that are also their own property and "owed" back to themselves! And along with this insanity we throw in additional temporal based fees (interest) for the existence of the units so created until such time as they are "paid back"; and these fees are marching along and compounding (by addition to every transaction along the ‘value chain’) until the very next iteration of this same process starts all over again!
But this is NOT the whole of the problem, because the populace is still stuck with the illegitimate thinking that "the government" (as though it is actually something separate from the populace itself) has this mystical original power to create - Poof! - the unit of acCount by some sort of magical power that entitles government to claim the same kind of asinine 'property rights' over its declared/established currency (that stupid illiterate establishment clause in the Constitution) such that it can both delegate the "creation" process to banks while also retaining some "ownership" claim over the units which it has already declared to be the form in which taxes must be paid! (David Graeber documents the long history of this lunacy in his book Debt: The First 5000 Years) And just like that - Poof! - the populace thinks that abstract acCounting units are things unto themselves that are claimed as property by a government (seemingly separate from the populace) that has exclusive power to both create and collect this "property" as a means to sustain itself as though government is something altogether separate from the populace! And when the focus has shifted in this process from the real contributions (that 'the government' just like any other member of the populace can/could easily acCount for with units of acCount that come into being in book keeping fashion) that a populace can require of itself to sustain itself to this asinine thinking about units of acCount as entities unto themselves that can somehow magically substitute for those real contributions, then the populace has given itself over to abandonment of its own power to any who will take up this power and use it for its own purposes. And ALL of this is based on the illegitimate thinking that an abstract unit of acCount can be, simply on the basis of declaratory assertion by illiterate and mostly illegitimate "leaders", both an abstract economic measure of value and a genuine commodity at one and the same time!!
well you’re certainly not tilting at windmills… though it may seem that way to those who have been drinking the kool-aid ….
Thank you again, Peter. To remain diplomatic and focused on long term objectivity maybe we can assess the historical 'drinking of the kool-aid' as having been going on since we abandoned fungible trade goods for abstract representation of value in our record keeping systems. This has been so long standing that we've confused the effects with the cause. And we are ALL participating within the system that from its conceptual base cannot produce anything but more of what we see all around us.
This is what we are passing to all we at the MSTA have conversation with:
Will you support a full objective evaluation of the “money system” from a strict system dynamics perspective?
Please take this into consideration:
1) The money system is a mere component of the economy whose dynamic status can be determined to be either stable (passive or active), unstable (active).
2) Being a purely human construct “money" requires a formal objectively evaluable ontological definition. Yet there is no consensus on what money is.
3) “Money" has been iterated ad hoc over informally assumed notions of it, taken by rote in spite of being ontologically undecidable.
4) How, in the event of constituting an unstable component of the economy, the "money system" produces economic imperatives that destabilise economic components that assume them as requirements.
5) Financial/economic units ($, €, etc..) also lack any formal (decidable) definitions rendering indeterminate any calculations in terms of these units vis-à-vis the “real” economy.
I think such an inquiry is long overdue as it seems evident that money imperatives seem to override most if not all other concerns; and not having independent existence of humans, “money" needs to be fully defined and specified like any other technological device applied to the real world.
Unfortunately, because everyone's survival and hope for individual prosperity as members of society are intertwined with money, when it comes to evaluating it as a mere technology all reason seems to be abandoned by most. Hopefully this will not prove to be the case with your organisation.
You Have Been Served
https://bibocurrency.com/index.php/downloads-2/19-english-root/learn/300-you-have-been-served
--- Marc Gauvin and all the international members/MSTA
Maybe you can consider bringing this to the attention of others?
I do take heart in the work you have done with Native People, because in their traditions we don't find this basic illiteracy about abstract representation of value or even much of the obsession with 'acCounting' as practiced by the colonizers. I hold a certain hope that some large contingent of Native Scientists can help correct the lack of correct use of the colonizers' own 'Applied Math' in monetary systems!
The question remains for humanity to address that if the functional use of money is as an accounting tool that comes in support of our own freely chosen and directed activity (as a record, an annotation of value) and after the doing gets done, then there should be no logical way any people can ‘run out of money.’
How many think there are inch and millimeter and gallon and liter creators?
Yet we think there are money creators!??? WTH!? And this is the 21st century!
https://open.substack.com/pub/nevermoremedia/p/money-was-invented-so-people-could?r=1bajmy&utm_medium=ios
might be of interest:
https://substack.com/@bhippie/note/c-70014422?utm_source=notes-share-action&r=1hp10e
Hello and Thank You, Peter, for that piece on how land is being "bought" by the modern day colonizers. I am reminded of the story you have told of the Native Tribe that lost their land because the US said the tribe was "paid" for the land with something supposedly 'of value' that the US government claimed some magical right to 'create'!!
The basis of the entirety of the claims of 'ownership' that capitalist companies (Blackrock & Vanguard, Chinese investment groups, etc. whose owners are not ever disclosed) make is by way of the system of money. In the present system of money the monetary unit magically comes into existence as an act of government - Poof! - or as an act of banking - also Poof! - and every single interchange activity of the people that occurs within this system is thereby subjugated to the banks and/or the government. We saw during the '08 crash (and throughout history) for whom the government would use its illiterate magical powers. And we also saw in that time frame and now how quickly the banks would/will snatch up the 'collateral' in the magical illiterate process called foreclosure. And still we seem to think that the BlackRocks and Vanguards of the world are the problem but that the way we do money itself is ok!? How is it that we do not see the system as having produced the very players that we are now so concerned about? Are we all monetary illiterates? In fact, yes. And THAT must change if this perennial problem is going to finally go extinct.
It is our very conceptual basis of what money is and does that is at the heart of our troubles. We make the mistake of thinking that the unit we use for the Measure Of Value is "value" itself. But how can that be? It cannot. So we keep making the mistake of considering the unit of acCount to also be one of the items of 'value' that we are exchanging without realizing that attaching 'value' to the unit of measure that then fluctuates, systemically and subjectively and exponentially, we destabilize the entirety of all the rest of our transactional experience.
So, when we establish that the origin of the currency unit coming into existence is as a simple function of annotation/bookkeeping of the freely initiated and determined economic enterprise of the populace we free ourselves and our economics from the mistake that currency units/units of acCount can be things of value all by themselves. AND we free ourselves of the BlackRock and Vanguard phenomena.
Just like we do not see a market in inches vs millimeters we also know that there is no magical inch or millimeter creator that must create the units before we can measure the length of things! What we have done in our own governance is establish the specifications for the measurement of length with these unit standards. But we have not yet done so with the unit we are attempting to use as a standard abstract unit of representation of this thing called value.
Money itself must be understood as a unit of measure....and no one 'creates' units for this purpose.....the governance of and by a free populace defines and specifies the reference criteria for the unit so that any and all can freely and reliably use it for the representational purpose it serves. The role of government then is NOT in unit creation (or in handing this illiteracy off to banks/financiers ) but is in regulation and adjudication of the consistent use of this tool across the society. del Mar puts it like this: "When money shall be recognized in the law, when it is defined, when its volume, magnitude, dimensions, limits are set forth as precisely, fixed as unchangeably, and protected as securely from alteration, as are now the dimensions of the yard-stick, the pint-pot, and the pound-weight, then, and then only, will money perfectly resemble other measures; for then only will it become a concrete thing of known dimensions. When this comes to pass, Aristotle's definition of its function will resume its original correctness, and money will be as fit in fact, as it is now only in theory, to measure the relation called value." Alexander del Mar, The Science of Money (1885)
Marc Gauvin points out that a valid definition that is unequivocal is missing so far in human history. Former President of the FR Bank in Minnesota, Kocherlakota, proves the current definitions to be "vacuous" and asserts that the function of money is as a unit of measure/bookkeeping.
In Kocherlakota's words:
“My argument demonstrates the vacuity of the three standard explanations of the role of fiat money in an economy: money acts as a store of value, a medium of exchange, and a unit of account....The traditional explanations for the presence of money in an economy are more descriptive of its functions than explanatory. The true explanation for money’s presence is that money is a record-keeping device.”
https://www.minneapolisfed.org/research/qr/qr2231.pdf (pages 2-3)
So, you can see that at the core conceptual level of thinking about money we still have to get the concepts right in order that the system can actually serve its functional purpose. When we have the courage to correct this basic error the populace can free itself from its past and enter into a new paradigm.
https://mrcenter.info/Doc/ConferencePapers/2020/MRC%202020%20A%20systems%20approach%20to%20money_4122020%20rev2_17.01.2021.pdf
Crowfoot stood and watched as the white man spread many one dollar bills on the ground.
“This is what the white man trades with; this is his buffalo robe. Just as you trade skins, we trade with these pieces of paper.”
When the white chief had laid all his money on the ground and shown how much he would give if the Indians would sign a treaty, Crowfoot took a handful of clay, made a ball out of it and put it on the fire.
It did not crack.
Then he said to the white man, Now put your money on the fire and see if it will last as long as the clay.
The white man said, No….my money will burn because it is made of paper.
With an amused gleam in his eyes the old chief said, Oh, your money is not as good as our land, is it?
The wind will blow it away; the fire will burn it; water will rot it. But nothing will destroy our land.
You don’t make a very good trade.
Then with a smile, Crowfoot picked up a handful of sand from the river bank, handed it to the white man and said, You count the grains of sand in that while I count the money you give for the land.
The white man said, I would not live long enough to count this, but you can count the money in a few minutes.
Very well, said the wise Crowfoot, our land is more valuable than your money. It will last forever.
It will not perish as long as the sun shines and the water flows, and through all the years it will give life to men and animals, and therefore we cannot sell the land.
It was put there by the Great Spirit and we cannot sell it because it does not really belong to us.
You can count your money and burn it with a nod of a buffalo’s head, but only the Great Spirit can count the grains of sand and the blades of grass on these plains.
As a present we will give you anything you can take with you, but we cannot give you the land.”
Chief Crowfoot : Blackfoot Confederacy
good story to explain the contrasts! thanks
Brett Reginald Scott tells us what many have (Graeber, Douthwaite, Forstater, and others), that present money systems are not a natural phenomena.
"To escape solutionist accounts, you have to accept the possibility that money was introduced into a world where there was no intrinsic or systemic ‘demand’ for it (much like my body has no demand for cigarettes in a world where I’ve never encountered them). From this perspective, the history of money is a series of political-economic events where people who didn’t rely on money slowly took little puffs on it in limited situations - the monetary equivalent of ‘social smoking’ - or were forced into it through acts of political coercion. This sets off a shift, then a slippage that becomes a landslide. Resistance to dependence on money erodes, then collapses, locking the society in.
As any economic anthropologist knows, there are many ways that pre-capitalist societies collaborated for survival, using combinations of logics and practices that ranged from informal reciprocity, gift-exchange systems, hierarchal redistribution, patronage systems, and small-scale communism alongside forms of commercial exchange. As I discuss in my video and article on Tabu ‘shell money’ in Papua New Guinea, many pre-capitalist ‘currencies’ were not commercial in nature, and were only used in ritualistic settings to mediate social relations and power.
The capitalist money that we’re used to, however, is inherently linked to the rise of states, imperialism and colonial conquest. This is not the place to recount that history, but - in highly stylized terms - political actors introduce credit systems, forms of coinage, and tribute systems that gradually snowball into larger systems. Money acts as a dissolution agent, dissolving situations of small-scale interdependence and recombining them into large-scale interdependence. It transforms smaller discrete economies into larger integrated ones.
For the groups on the left of the picture above, money might once have had some optional element to it. For example, in my homeland of South Africa in the 1800s, Zulu, Xhosa and other groups held onto traditional subsistence systems that enabled them to live outside the colonial market economy, while occasionally dabbling in those markets. This slowly changed, however, as the colonial government forced them to pay ‘hut taxes’ that required them to work in mines to get the colonial money needed to pay the tax. This is spelled out in the 1893 report about the ‘native labour question’ by the Committee of the Mine Managers Association : “It is suggested to raise the Hut Tax to such an amount that more natives will be induced to seek work, and especially by making this tax payable in coins only”.
The word ‘induced’ is telling. It suggests a process of trying to artificially stimulate demand for something that isn’t intrinsically demanded. This is the early stage of proletarianization, the process by which people are severed from a previous means of survival and integrated into a new one - wage labour."
The word 'induced' also speaks to the question of liberty while still using these systems of colonial money. As various local imperial powers imposed their colonial currencies on the local populace the system spread world wide. But now we are told that there are legitimate differences between the 'values' of these imposed currencies! Picking sides within the illiterate context of 'national currencies', and illiterate fear mongering about the consequences of these ancient struggles about who's imperially 'issued' currencies hold 'more value', will not address or correct the present, and ages old, mistaken paradigm.
http://bibocurrency.com/index.php/downloads-2/19-english-root/learn/271-brief-history-of-money-s-misrepresentation
http://bibocurrency.com/index.php/downloads-2/19-english-root/learn/299-stop-wwiii
Joseph Plummer's Tragedy and Hope 101 gives a concise account of history of money you describe (beginning with the vault keepers).
https://www.joeplummer.com/
Those numbers are like a Burger King Big Whopper. i don't know how much directly connected with WW I, but the Federal Reserve was created December 23, 1913. Of what little i know, the Fed Reserve prints money then the government gets, with interest, so there's debt built into the system.
Yes. Debt built into the system. Effectively, money is debt.
That's an economy koan: money is debt.
In fact, funding WWI and WWII was ONE OF THE MAJOR REASONS the international bankers set up the Federal Reserve to begin with. It was all in the cards.
i suspected something b/c of the timeline with WW I, so thanks for the info!
https://open.substack.com/pub/totheroot/p/the-men-who-spawn-depressions-and
Thanks for the link. Recently saw this article "History: The Federal Reserve Cartel: Freemasons and The House of Rothschild" https://www.globalresearch.ca/the-federal-reserve-cartel-freemasons-and-the-house-of-rothschild/25179
According to Google (someone fact check?) the US GDP is now $27 trillion while the National Debt is $35 trillion. So our debt is 1.3 years worth of GDP. This is high but I remember it being higher at times in the last 20 years. This might be a fruitful way to assess progress or backsliding.
The CIA WorldFactBook page (! they’ve got their fingers in every pie and hands on every lever!) says:
"United States
110.39% of GDP (2022 est.)"
The GAO says:
This year’s report shows the federal budget deficit in fiscal year 2023 to be $1.7 trillion. This deficit is due to a $1 trillion gap in what the government collected and what it spent. It also reflects the $659 billion in interest paid on total federal debt—up from $352 billion just two years ago.
GAO’s projects that debt held by the public as a share of the economy will more than double over the next 30 years and will grow faster than the economy over the long term if current revenue and spending policies are not changed. This outlook is consistent with projections from the Congressional Budget Office and the Office of Management and Budget and Department of the Treasury. Interest paid to service the total federal debt also grew this year and is expected to steadily increase. This will lead to higher borrowing costs as overall debt increases and interest rates rise.
This unsustainable long-term fiscal path poses serious economic, security, and social challenge….”
Another cog in the government wheel
the grease in the cogs
I think we need to distinguish certain things in analysing money system issues:
1) The nature of a system: Any system s either passive or active, stable or unstable. Passive systems are by definition stable, if a system is active it can be either stable or unstable. If a system is active then it will influence its environment i.e. will issue imperatives to its environment in order for it to continue functioning. If it is active but stable those imperatives will be "bounded" while if active unstable they imperatives will be unbounded.
2) Behaviour of system components either conform to the system nature or they expressly act to change the system's nature. So the nature of a given system A is not altered by its components unless those components expressly act i.e. to transform A to say system B i.e. the components are non conformant to A, giving way to a completely new system. Note, such a transformation can take place by simply modifying a single parameter. E.g. remove vitamin C from a body and the bodies ability to produce collagen will cease leading to failure of a body tissues leading to simultaneous failure of all critical systems, this is called scurvy. The cure if given soon enough consists of simply adding vitamin. So stable body system A is transformed into unstable body B and back by virtue of a single parameter vitamin C.
3: Unstable systems by their very nature either destabilise their environment or are cancelled, this is another way of saying instability cannot persist indefinitely.
4) There are two categories of systems human and non-human natural systems. Human systems operate wholly according to human criteria - definitions and specifications that are either coherent or not with respect to some or other "purpose" of "function" determined by humans alone. Non human systems are determined by the nature of "reality" in which all human systems and devices are produced. The important take home is that human systems are fully determinable by humans while natural systems are not.
Applying the above elementary system dynamics facts to "money" and in order to deal with all related issues in terms of system dynamics, we need to deeply consider the following points:
1) The money system is a mere component of the economy, whose dynamic status can be determined to be either stable (passive or active), unstable (active).
2) Being a purely human construct, “money" requires a formal objectively evaluable ontological definition. Yet there is no (coherent) consensus on what money is.
3) “Money" has been iterated ad hoc over informally assumed notions of it, taken by rote in spite of being ontologically undecidable (conflating the concepts of measure and commodity like tradable artefact without noticing how/when these notions are mutually exclusive).
4) How, in the event of constituting an unstable component of the economy, the "money system" produces economic imperatives that destabilise economic components that assume them as requirements.
5) Financial/economic units ($, €, etc..) (used to denominate “money" also lack any formal (decidable) definitions, rendering indeterminate any calculations in terms of these units vis-à-vis the “real” economy.
Why use system dynamics and not economic or finance theory? Because system dynamics constitutes a common (objective) framework for determining "reality" that is amiss in economic theory. That is to say, most all if not all economic and finance theories share no common framework to evaluate themselves against each other, what they do instead is to treat "money" as if it were of independent nature that we must simply adapt to its imperatives and never question as "no one yet understands its nature fully". This of course is nonsense, we created the thing and can modify as we wish and need to, for which economic and finance theory currently lack the requisite curriculum of knowledge to even approach any system definition and specification endeavour.
"...But demand has come to be conventionally represented by money; this is why money is called nomisma （customary currency）, because it does not exist by nature but by custom （nomos）, and can be altered and rendered useless7 at will. [12] " - Aristotle, Nicomachean Ethics 5.5
https://www.perseus.tufts.edu/hopper/text?doc=Perseus:text:1999.01.0054:book=5:chapter=5&highlight=nomisma