Book: Debt: The First 5,000 Years
Quotes of Book: Debt: The First 5,000 Years
I am not speaking strictly of slavery here, but of that process that dislodges people from the webs of mutual commitment, shared history, and collective responsibility that make them what they are, so as to make them exchangeable--that is, to make it possible to make them subject to the logic of debt. Slavery is just the logical end-point, the most extreme from of such disentanglement. But for that reason it provides us with a window on the process as a whole. What's more, owing to its historical role, slavery has shaped our basic assumptions and institutions in ways that we are no longer aware of and whose influence we would probably never wish to acknowledge if we were. If we have become a debt society, it is because the legacy of war, conquest, and slavery has never completely gone away. It's still there, lodged in our most intimate conceptions of honor, property, even freedom. It's just that we can no longer see that it's there. book-quotewarpropertyslaveryThe most remarkable thing is that even in Adam Smith's examples of fish and nails and tobacco being used as money, the same sort of thing was happening. In the years following the appearance of the Wealth of Nations, scholars checked into most of these examples and discovered that in just about every case, the people involved were quite familiar with the use of money, and in fact, were using money- as a unit of account. Take the example of dried cod, supposedly used as money in Newfoundland. As the British diplomat A. Mitchell pointed out almost a century ago, what Smith describes was really an illusion, created by a simple credit arrangement: In the early days of the Newfoundland fishing industry, there was no permanent European population, the fishers went there for the fishing season only, and those who were not fishers were traders who bought the dried fish and sold to the fishers their daily supplies. The latter sold their catch to the traders at the market price in pounds, shilling and pence, and obtained in return a credit on their books, which they paid for the supplies. Balances due by the traders were paid for by drafts on England or France. It was quite the same in the Scottish village. It's not as if anyone actually walked into the local pub, plunked down a roofing nail, and asked for a pint of beer. Employers in Smith's day often lacked coin to pay their workers; wages could be delayed by a year or more; in the meantime, it was considered acceptable for employees to carry off either some of their own products or leftover work materials, lumber, fabric, cord, and so on. The nails were de facto interest on what their employers owed to them. So they went to the pub, ran up a tab, and when occasion permitted, brought in a bag of nails to charge off against the debt. The law making tobacco legal tender in Virginia seems to have been an attempt by planters to oblige local merchants to accept their products as a credit around harvest time. In effect, the law forced all merchants in Virginia to become middlemen in tobacco business, whether they liked it or not; just as all West Indian merchants were obliged to become sugar dealers, since that's what all their wealthier customers brought in to write off against their debt.The primary examples, then, were ones in which people were improvising credit systems, because actual money- gold and silver coinage- was in short supply. book-quoteFor centuries now, explorers have been trying to find this fabled land of barter- none with success. Adam Smith set his story in aboriginal North America {others preferred Africa or the Pacific}. In Smith's time, at least it could be said that reliable information on Native American economic systems was available in Scottish libraries. But by mid-century, Lewis Henry Morgan's descriptions of the six nations of the Iroquois, among others, were widely published- and they made clear that the main economic institution among the Iroquois nations were longhouses where most goods were stockpiled and then allocated by women's councils, and no one ever traded arrowheads for slabs of meat. Economists simply ignored this information. Stanley Jevons, for example, who in 1871 wrote what has come to be considered the classic book on the origins of money, took his examples straight from Smith, with Indians swapping venison for elk and beaver hides, and made no use of actual descriptions of Indian life that made it clear that Smith had simply made this up. Around that same time, missionaries, adventurers, and colonial administrators were fanning out across the world, many bringing copies of Smith's book, expecting to find the land of Barter. None ever did. They discovered and almost endless variety of economic systems. But to this day, no one has been able to locate a part of the world where the ordinary mode of economic transition between neighbours takes the form of "I'll give you twenty chickens for that cow. book-quoteFrank Baum's book the Wonderful Wizard of Oz, which appeared in 1990, is widely recognized to be a parable for the Populist campaign of William Jennings Bryan, who twice ran for president on the Free Silver platform- vowing to replace the gold standard with a bimetallic system that would allow the free creation of silver money alongside gold.As with the Greenbackers, one of the main constituencies for the movement was debtors: particularly, Midwestern farm families such as Dorothy's, who had been facing a massive wave of foreclosures during the severe recession of the 1890s. According to the Populist reading, the Wicked Witches of the East and West represent the East and West Coast bankers {promoters of and benefactors from the tight money supply}, the Scarecrow represented the farmers {who didn't have the brains to avoid the debt trap}, the Tin Woodsman was the industrial proletariat {who didn't have the heart to act in solidarity with the farmers}, the Cowardly Lion represented the political class {who didn't have the courage to intervene}. The yellow brick road, silver slippers, emerald city, and hapless Wizard presumably speak for themselves. "Oz" is of course the standard abbreviation for "ounce. book-quoteLooking over world literature, it is almost impossible to find a single sympathetic representation of a moneylender- or anyway, a professional moneylender, which means by definition one who charges interest. I'm not sure there is another profession {executioners?} with such a consistently bad image. It's especially remarkable when one considers that unlike executioners, usurers often rank among the richest and most powerful people in their communities. Yet the very name, "usurer," evokes images of loan sharks, blood money, pounds of flesh, the selling of souls, and behind them all, the Devil, often represented as himself a kind of usurer, an evil accountant with his books and ledgers. book-quote
