an important insight in this one: ---------- Forwarded message ---------- From: Great Transition Network <gtnetw...@greattransition.org> Date: Tue, Jul 11, 2017 at 8:44 PM Subject: Money for the People (GTN Discussion) To: michelsub2...@gmail.com
>From Alf Hornborg <alf.hornb...@hek.lu.se> ------------------------------------------------------- Comment on Mary Mellor’s essay “Money for the People” Mary Mellor is absolutely right that we need to understand that money is both a social construct and an active force, which means that it can be redesigned so as to promote quite different social and ecological processes than those generated by the current money system. She is justified in proposing that the creation of money should be democratically controlled through the state, and that this would make it possible not only to liberate us from the exigencies of debt and the compulsion to achieve economic growth, but also, for instance, to provide all the inhabitants of a nation with a basic income. Beyond the conceptual constraints of conventional economics, this perspective allows us to see that the rules of the economic game are as arbitrary and potentially mutable as the rules of any other game designed by humans. Nevertheless, I would like to complement Mellor’s crucial insights and proposals in a few ways. First, her assertion that it is not “money itself” that fuels exploitation and environmental destruction needs to be modified. As long as we are referring to what in economic anthropology is called “general-purpose money” (money that can be used to purchase virtually anything), money *itself* does indeed fuel exploitation and environmental destruction. If there are no constraints on what we can buy with our money, we shall naturally be looking for the best deals, which usually means the lowest-paid labor and the lowest-priced resources. The globalized capitalist market is an expression of the inherent logic of general-purpose money. This logic is the same regardless of whether such money is created by banks or states, and even regardless of the existence of interest. Mellor writes that “some form of money has been around in almost all human societies.” Yes, but not the particular form of money that developed in colonial Europe. The destructive implications of general-purpose money were evident to critics of market economies from Marx to Polanyi. [1] The logic of such money is distinctly different from the “special-purpose money” that was identified, for example, among the Tiv people of Nigeria. Precolonial Tiv, like most traditional cultures, recognized more than one sphere of value. [2] Whatever kind of money that existed, it could not readily buy *everything*. When Mellor writes that it is difficult to envisage societies without “some mechanism to facilitate comparisons of value,” she does not reckon with the possibility of recognizing such cultural limitations of commensurability. Mellor’s point that money is a social construct means that it is potentially possible to democratically design a money system that recognizes limits to commensurability. To take a couple of drastic examples, it would be possible to decide that rainforests are not exchangeable on the same market as Coca-Cola, or that food in the global South is not purchased with the same kind of money as is used for financial speculation on Wall Street. A system of separate currencies for basic needs versus global markets would insulate values pertaining to sustainability and survival from the abstract capital flows of the world-system. It could thus serve to check exploitation and environmental destruction. Second, I find it problematic to speak, as Mellor does, of things with “use value,” “social value,” or “little or no value.” Value is always in the eye of the beholder. We need to clearly distinguish between the biophysical properties of a given item, on the one hand, and its value for specific humans, on the other. There is no universal standard for judging whether a particular item has “use value,” “social value,” or no value at all. Value is a thoroughly cultural phenomenon. This means that we need to think about economy and ecology as analytically separate, even though we know that they interact in practice. In doing so, for example, we can see that we tend to value things higher the less of the original energy that is left in a set of resources transformed in production. [3] Mellor is definitely on the right track. The planet will not be saved by trying to get the colonial outlook of mainstream economics to somehow accommodate the Second Law of Thermodynamics. [4] Nor will it be saved by a socialist revolution that collectivizes ownership but continues to think in terms of money and exchange value. Money is not just a reflection of the relations of production but an artifact that operates as an active force in organizing such relations. To change the logic of the global economic game, we must change money itself. My third point, then, is that the basic income to which all of should have a right should not be paid in general-purpose money, because that would simply keep us buying the products of the lowest-paid labor and the most degraded landscapes. [5] It should be paid in a special-purpose, complementary currency that can only be used to buy products and services produced within a specified radius of the point of purchase. This is not “local money” in the sense of geographically restricted currencies, but one single, national currency – issued by the state – that is only for local use. There is no space here for listing the many social and ecological benefits of such a reform, but it would be quite in line with Mellor’s general understanding of money as our main – perhaps only – chance of achieving sustainability, justice, and resilience. [6] [1] In his book “The Great Transformation” (1944), Karl Polanyi argued that the idea of the self-regulating market, unless checked by society, would logically lead to increasing exploitation, environmental degradation, and economic instability. [2] The economic anthropologist Paul Bohannan in the 1950s showed that the Tiv economy was organized around three separate “spheres of exchange,” and that some conversions between separate spheres of value were morally discouraged. [3] This was pointed out by Nicholas Georgescu-Roegen in his 1971 book “The Entropy Law and the Economic Process.” [4] The Second Law of Thermodynamics, also called the Entropy Law, states that the energy and matter of an isolated system will become more disordered over time. As Georgescu-Roegen showed, this implies that an economic production process will simultaneously increase economic value and physical disorder. [5] In choosing the least expensive products, consumers inadvertently encourage production processes that show the least concern for the environment, which often means the most lax environmental legislation. [6] I have elaborated this proposal in an article called “How to Turn an Ocean Liner,” in volume 24 of the Journal of Political Ecology (2017). Professor Alf Hornborg Human Ecology Division, Lund University +46 222 3113 +46 708 122433 www.palgrave.com/cn/book/9781137567864 ************************************************************ ***************** Från: Great Transition Network Skickat: den 11 juli 2017 01:03 Till: Alf Hornborg Ämne: Money for the People (GTN Discussion) >From Gwendolyn Hallsmith ----- Report from the Front Lines of Monetary Democracy Thank you for the opportunity to comment on Mary Mellor’s thoughtful essay about Money for the People. Her call for public money and robust, democratic, transparent money issuance can be seen as what Star Trek refers to as “the final frontier” in our efforts to create a resilient, sustainable world. I wholeheartedly agree with her public money solution, yet sadly lack her confidence in centralized, party-driven, representative global governance. I imagine she might be a Star Trek fan, with a secret hope that the Federation can save the day. I have to confess that I was immediately on guard with her abstract’s first sentence, which relegated “local initiatives” to the sidelines, claiming that they can only lead to modest gains, not large-scale transformation. Why are we so enamored with large scale in the first place? I have begun to see anything larger than human scale as part of the problem, not part of the solution. Particularly when it comes to democracy. (I am writing from the U.S., where we are suffering from extreme inequality’s impact on large-scale democracy – and the best government our corrupt and debt based money can buy). Beyond the initial assumption about local initiatives, she actually doesn’t talk at all about why large scale is needed, even in the quest for public money – she seems to conflate “public” with large, central states. Public comes in many flavors, after all, and the Sparkasse public banks in Germany have demonstrated that some level of public money is possible at a small scale – there is no town too small in Germany to host one of these independent, networked public banks. Here in bucolic Vermont, we have been working with some success to get a Vermont State Bank, which would wrest a portion of the money issuance authority from the large, private banks. My experience here, however, has shown me that the large powers – the globalized corporations, their partners in globalized banks, and their hapless cronies in neoliberal academia – have set numerous obstacles on the road to Money for the People, and these obstacles need to either be overcome or rendered obsolete before a large-scale transformation is possible. Overcoming them is nearly impossible – they control the media, the money supply, the armies, navies, courts, and legislatures. The rewards they offer their adherents – unlimited wealth, power, and privilege - is too strong a potion, even if it is only a pipe dream. Three years ago, 20 towns and cities in Vermont voted to direct the state legislature to establish a Vermont State Bank. Our towns and cities make decisions using the closest thing to direct democracy, where every registered voter has a right to vote on budgets, laws, and other propositions. Did the legislature take this democratic input and act? Not really. We still do not have a state bank, even though they threw us a bone where 10% of the money in the big banks is now loaned directly into the Vermont economy. This year, when we went to the legislature with the successful (and profitable) experience of that program as the wind at our backs, we ran into a stone wall. This is precisely because in addition to the growth imperative and inequality machine the current monetary system imposes, as Mellor very carefully and accurately documents, the artificial scarcity and hoarding the system requires pits the “haves” against the “have-nots” and the people in power – the elite – know on which side of the toast their bread is buttered, and do not lift a finger to help us, even when their political party has public banking as a plank in their platform. My faith in parties has died with my faith in large-scale democracy, I’m afraid. They are not public, they are not democratic, and they need to die a rapid and final death. Lest you imagine that my despair at the progress on the road to Money for the People has left me bereft, take heart. I believe we are on the cusp of the old system being rendered obsolete, much, much easier on some levels than overcoming the powers by fighting them directly through democratic organizing and legislative action. I am not giving up on that; just saying it is necessary but not sufficient. I have seen the future, and it is block chaining its way into the heart of the human value system, where things with true meaning and value can thrive again. The advent of new value-embedding technologies is something that Mellor does not even mention. While they are encrypted now in the labyrinthine interwebs, their principles and practices can apply universally, and I would argue even without the complex and sometimes impenetrable technology. My prediction: these systems will restore sovereignty to human-scale communities once again, and we will be free from large-scale totalitarian domination and impoverishment. They can be at once both private and public – the new transparency makes it possible to keep watch on their “amplification” and development. The distributed ledger is at once both local and global. Local iterations can spring into existence using highly democratic and time-tested issuance and conflict management practices. Their identity certification and transaction transparency can pave the way for direct, not party, democracy at all scales. The UN has just issued payments in a refugee camp in Ehters, for example, demonstrating that global and local can work together directly and effectively for the common good. Public, private, global, local, large and small – all of these demand definition and rethinking if we are to transcend the bitter and outdated paradigm that is driving the planet toward rapid human extinction. Neoliberal economics and their elitist partner in representative democracy are well past their shelf life – let’s bring on the new day already. Beam me up, Scotty. Gwen Hallsmith ************** On Sat, Jul 1, 2017 at 9:31 AM, Great Transition Network wrote: >From Paul Raskin ________________________________________ Dear GTN, The old proverb—money is the root of all evil—may overstate the case, but money is, indeed, implicated in the iniquitous debt/growth spiral now degrading Earthland. Mary Mellor explains in her new GTI essay, “Money for the People,” that it needn’t be so. The modern money system is a social construct that evolved to spur capital accumulation, but lingers on in an era needing, instead, to throttle consumerism, debt, and the economic growth machine. Rather than creating money privately through bank lending, as the current system does, an alternative approach—public money—can undergird an economy oriented toward people and use value, not profit and exchange value. I think you’ll find Mary’s vision of a critical institutional pillar of a Great Transition economy illuminating, intriguing, and inspiring. Please read it at www.greattransition.org/publication/money-for-the-people, and let the comments and questions begin! How would public money work in practice? How would it interface with the market? How might its pursuit contribute to strategies for system change? Comments are welcome through JULY 31. Looking forward, Paul Raskin GTI Director HOW WE WORK Odd-numbered months are for internal GT Network discussions; even-numbered months are for public dissemination. You will receive all comments via email, and can review the entire thread online at www.greattransition.org/forum/gti-forum. The essay will be published alongside a “Roundtable,” comprised of selected comments from the GTN discussion and a response from the author. ----- Hit reply to post a message Or see thread and reply online at greattransition.org/forum/gti-discussions/191-money-for-the-people/2369 Need help? Email jc...@tellus.org ------------------------------------------------------- Hit reply to post a message Or see thread and reply online at http://greattransition.org/forum/gti-discussions/191- money-for-the-people/2370 Need help? Email jc...@tellus.org -- P2P Foundation: http://p2pfoundation.net - http://blog.p2pfoundation.net Connect: http://p2pfoundation.ning.com; Discuss: http://lists.ourproject.org/cgi-bin/mailman/listinfo/p2p-foundation Updates: http://del.icio.us/mbauwens; http://friendfeed.com/mbauwens; http://twitter.com/mbauwens; http://www.facebook.com/mbauwens
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