I just listened to this podcast talking with professor David Hawkes about money, finance, and the power of symbols. Highly recommended. Here are some of the main points:
1. Because people sell their time in exchange for a symbol of the work performed during that time (money), they begin to see themselves as a commodity.
2. When we give money the power to reproduce, it becomes “alive”. When money is ascribed the characteristics of a living thing it consequently gains its own needs, desires, values, interests etc., which may conflict with the needs, desires, wants and interests of real people and things. By giving the behavior of living things to a dead object, people assume powers that should only be granted to God, which is why all the major religions prohibited usury. The subjective is assigned an objective existence, with everything that entails.
3. Money is a collective delusion, so there is no way any one single person can make it go away by refusing to believe in it. It has no material existence outside of the human mind, yet it is the most powerful force in the modern world. We destroy the real world of human relationships and the natural world for these symbolic tokens which have no real objective existence.
4. All capital is alienated labor in external symbolic form.
5. In a system of wage labor what the worker is selling is his time, rather than his labor. Time is indistinguishable from life, so what we are really selling is our lives. Selling one’s life piecemeal gives one a materialist outlook essentially indistinguishable from that of a slave.
6. Societies newly introduced to the workings of money often experience witchcraft panics (medieval Europe, modern sub-Saharan Africa, etc.) because people are achieving power by nontraditional means. The rich seem to make money out of thin air, which is why in African societies "big men" are thought to be practicing a sort of witchcraft (e.g. Duvalier in Haiti). The money economy takes a medium of symbolic representation and causes it to influence the actual physical world of objects and people. In this way, it is exactly analogous to traditional ceremonial magic.
7. The Economy is a relatively recent invention. The idea of something called “An Economy” as distinct from the larger society was invented by political philosophers in the eighteenth century as a way of rationalizing certain self-interested, avaricious and greedy behaviors that take place in a market economy which were formerly sanctioned by ethical and moral systems. A totally arbitrary distinction is made between behaviors that are “economic” and hence outside all other spheres of human relationships - political, social, ethical, religious etc. where naked self-interest is expected and justifiable.
8. Aristotle distinguished between use value and exchange value. The use value is inherent in the material of the object itself – a pen for writing, a watch for telling the time. Exchange value is symbolic, not material. Aristotle believed that the purpose of economic activity was to produce use value. Exchange value is simply a means to an end – the end being the use value. When economic activity is divorced from any use value: making money from money with no ultimate beneficial purpose, it is unnatural. (i.e. financial profits). This is why usury is unnatural. In market economies exchange value completely dominates the economic system.
9. The distinction between the proletariat and the bourgeoisie in traditional Marxism is no longer valid in modern society – nearly all workers receive some sort of unearned “investment” income in addition to their wages, whether it be a mortgage, a pension, bonds, etc., and most people who receive income from investments also sell their labor power as well.
10. The central idea of Marxist revolution was one of workers of taking up arms against the bourgeoisie and seizing control of the means of production in advanced capitalist economies to expropriate their own alienated labor power. Attempts to overthrow capitalism by socialist politics universally failed. Where Socialist revolutions did take place, they were peasant rebellions in pre-capitalist societies (Russia, China, Cuba, Vietnam).
11. Our society is completely based on usury. Because of usury, Capitalism is committed to unceasing growth. If you borrow at interest you have to pay back more than you borrowed, that is, you must grow. But you cannot grow forever since you have limited resources. This will make capitalism psychologically untenable. Will we do away with it before it does away with us?
12. The use of money has caused Postmodern philosophers see the world as just symbolic, divorced from any hard and fast concrete reality. There is no ultimate truth, everything is fluid with no inherent identity. To some this is exciting, to others troubling.
13. It took a long, persistent ideological campaign to make people see usury as anything other than unnatural. Every previous system of thought in human history has claimed that usury is the tool of the devil and usurers are evil. People are naturally inherently resistant to the idea of usury.
I find number 7 to be particularly interesting. We're told Adam Smith "invented" economics in 1776. Really, there were no economies before then? What he really invented was a way to justify self-interest. Adam Smith was actually a professor of moral philosophy. In his lifetime he was much more known for his work The Theory of Moral Sentiments, which tried to explain the origins of human morality, than he was for The Wealth of Nations. In fact, the first person to hold the "official" position of an economist was none other than Thomas Malthus, whose conclusions have been soundly rejected by mainstream economists ever since!
Adam Smith's central question was how self-seeking behavior could lead to positive outcomes. In theory, according to all known moral codes, people acting out of selfish reasons should lead to only negative outcomes. To explain this discrepancy, he invented the "economy" through which works the famous "invisible hand." As Wikipedia puts it, "by trying to maximize their own gains in a free market, individual ambition benefits society, even if the ambitious have no benevolent intentions."
And once "The Economy" was invented, all other human endeavors became subsumed by it. Now there is nothing but "The Economy." And what is the purpose of "The Economy?" To grow eternally, by any means, full stop. The needs of society, and of the natural world, became subsumed to the needs of money, and naked self interest became not an abomination, but a laudable goal for everyone. Turning moral sentiments on their ear, Ayn Rand proclaimed that altruism was harmful, and that people should act for no other motivation than pure selfishness. Margaret Thatcher famously proclaimed that there is no such thing as society, only individuals. This philosophy has now become the guiding ideology of the capitalism.
Over time, economists decided that all people were were merely atomized individuals seeking to benefit themselves. They made complex mathematical models of symbolic abstractions like prices and interest rates and assumed it told them something about the actual underlying world of physical objects. Even now politicians of all persuasions turn to their favorite economists to tell them what's going on while at the same time muzzling scientists.
I also like the concept that money serves to mystify human relationships. Because we no longer see any relationship between money and what it does, it allows myths like the ownership class creates all our wealth and that workers are merely parasites sponging off of their greatness to go unchallenged. It creates the idea that money can be made without some sort of work being done or value being created. We buy a house or a stock, and we magically get back more money than we put in, like a slot machine that always works. No wonder we're awash in magical thinking. It even infiltrates our language when we say things like a hedge fund manager "earned" twenty million dollars last year. By doing what, exactly? Since money mystically reproduces itself and obscures all the blood, sweat and tears that make the real economy work, we are convinced that the rich "earn" their money, rather than collect it. And of course they need ever more tax breaks and less regulations to keep it coming. Abracadabra!