- Published on Saturday, 13 June 2015 10:59
The UK government announced its intention to run a budget surplus in "normal times". This announcement reveals the almost universal ignorance about money: where it comes from and where it goes. Debt is money and money is debt. Pay off all the government debt and money disappears. The UK government is not alone in its ignorance; economics teaching is woefully deficient and most "experts" around the world are similarly afflicted.
David Graeber, in his book Debt the First 5000 Years, points out that conventional understanding of the origins of money is the complete opposite of what anthropological and historical records show. Money did NOT follow barter as a convenient means of exchange and debt did NOT follow money.
Debt and Credit pre-date physical money by millennia as evidenced by tablets from ancient Sumerian and other civilisations. Such methods of accounting for transactions were found throughout ancient civilisations including in China and India. Graeber's recent podcast series for BBC Radio 4 is essential listening if you want to understand money in its historical, theological, classical, commercial, military and political context.
Promises, promises: A History of Debt (10 fifteen minute audio podcasts)
Anthropologist David Graeber explores the ways debt has shaped society over 5,000 years
This matters because money underlies all our assumptions about economics. Our money system is gravely flawed because of this ignorance and it is the mechanism by which power has been concentrated in the hands of a few, plunging the rest of us into debt slavery.
The first step to salvation for the political economy is understanding money!