Summary
The term “social money” suggests that some money, such as the form we are familiar with, is not social, even anti-social. With Mauss, I consider that money’s principal function, like that of the gift, is the extension of society, just as Simmel saw society’s potential for universality reflected in money. People have always made money personal and social by adapting it to their own special purposes, but this was in dialectical tension with its ability to reach the most inclusive levels of association. It is therefore mistaken for proponents of “Local Exchange Systems” (SEL) to imagine that the principles they wish to introduce are something new; and, by designing money as a closed local circuit, they have failed to harness money’s global potential. Too often, in unconscious mimicry of national currencies, these introverted initiatives stand alone and fail as a result. The movement to reform money needs to embrace the power of federation more wholeheartedly in future. This in turn requires us to engage with the virtual society opened up by the internet. Money’s ability to make social connection has been vastly expanded by the “network of networks” and those who wish to work for economic democracy cannot afford to turn their backs on these developments. Michael Linton, who founded LETS 25 years ago, is now pioneering this next phase — developing smart-card technology, new software and multiple domain naming systems as the means of sustaining money on an open source basis. (more…) The classical economists focused on the commodity’s higher-order ability to enter into abstract relations of exchange with other commodities through money (quantity) rather than on its concrete value in use (quality). But the commodity remains something useful and in that use lies its concrete realization. The reality of markets is not just universal abstraction, but this mutual determination of the abstract and the concrete. If you have some money, there is almost no limit to what you can do with it, but, as soon as you buy something, the act of payment lends concrete finality to your choice. Money’s significance thus lies in the synthesis it promotes of impersonal abstraction and personal meaning, objectification and subjectivity, analytical reason and synthetic narrative. Its social power comes from the fluency of its mediation between infinite potential and finite determination. It is not enough to retreat into the local; we urgently need to develop more effective institutions at the level of world society too. Money’s ability to sustain local meaning and universal connection at the same time is an indispensable means to that end. Local money without global pretensions is as sexy as kissing your sister. If money is global as well as social, we must also recognize that it is virtual. Keynes (1930) distinguished between its abstract function as ‘money of account’ and the thing that passes between hands, ‘money proper’. Identification of currency with precious metals – either as coinage or later as the gold standard – lent credence to the idea of money as a scarce natural resource, obscuring its more fundamental role simply as a measure. We may lack the raw materials to build a house, but we can never be short of the metres, kilos and litres to measure the wood, cement and paint. So too it is with money; and this has become more evident as transactions have become increasingly virtual. The society opened up by the digital revolution now offers universal means for the expression of universal ideas. Money’s ability to make social connection has been greatly amplified by the internet, “the network of networks”, so that markets, world society and virtual reality feed each other’s explosive growth at this time. Those who wish to work for economic democracy cannot afford to turn their backs on these developments. Yet many of them are unfortunately wedded to reactionary ideologies that owe more to Aristotle and the medieval schoolmen than to contemporary social possibilities. Linton has always regretted the narrow localism that has plagued the movement for ‘social money’ in its first two decades. He is working with a number of colleagues (http://openmoney.info) to pioneer the next phase — developing smart-card technology, new software and multiple domain naming systems as the means of sustaining money on an open source basis. Some of the principles remain the same – the design of money as a closed circuit, the money issued by each participant as a promise to contribute their own goods and services – but others, such as sophisticated communication between circuits, are new. Now individuals may join any number of these circuits at once, reflecting their interests at several levels, not just the local, with a single smart card able to support simultaneously 15 or more of the circuits. It is lonely work and there is still much to be done; but without it ‘social money’ will remain an irrelevance to a world rapidly moving in a different direction. 5:25 AM
The term “social money” suggests that some money, such as the form we are familiar with, is not social, even anti-social. With Mauss, I consider that money’s principal function, like that of the gift, is the extension of society, just as Simmel saw society’s potential for universality reflected in money. People have always made money personal and social by adapting it to their own special purposes, but this was in dialectical tension with its ability to reach the most inclusive levels of association. It is therefore mistaken for proponents of “Local Exchange Systems” (SEL) to imagine that the principles they wish to introduce are something new; and, by designing money as a closed local circuit, they have failed to harness money’s global potential. Too often, in unconscious mimicry of national currencies, these introverted initiatives stand alone and fail as a result. The movement to reform money needs to embrace the power of federation more wholeheartedly in future. This in turn requires us to engage with the virtual society opened up by the internet. Money’s ability to make social connection has been vastly expanded by the “network of networks” and those who wish to work for economic democracy cannot afford to turn their backs on these developments. Michael Linton, who founded LETS 25 years ago, is now pioneering this next phase — developing smart-card technology, new software and multiple domain naming systems as the means of sustaining money on an open source basis. (more…) The classical economists focused on the commodity’s higher-order ability to enter into abstract relations of exchange with other commodities through money (quantity) rather than on its concrete value in use (quality). But the commodity remains something useful and in that use lies its concrete realization. The reality of markets is not just universal abstraction, but this mutual determination of the abstract and the concrete. If you have some money, there is almost no limit to what you can do with it, but, as soon as you buy something, the act of payment lends concrete finality to your choice. Money’s significance thus lies in the synthesis it promotes of impersonal abstraction and personal meaning, objectification and subjectivity, analytical reason and synthetic narrative. Its social power comes from the fluency of its mediation between infinite potential and finite determination. It is not enough to retreat into the local; we urgently need to develop more effective institutions at the level of world society too. Money’s ability to sustain local meaning and universal connection at the same time is an indispensable means to that end. Local money without global pretensions is as sexy as kissing your sister. If money is global as well as social, we must also recognize that it is virtual. Keynes (1930) distinguished between its abstract function as ‘money of account’ and the thing that passes between hands, ‘money proper’. Identification of currency with precious metals – either as coinage or later as the gold standard – lent credence to the idea of money as a scarce natural resource, obscuring its more fundamental role simply as a measure. We may lack the raw materials to build a house, but we can never be short of the metres, kilos and litres to measure the wood, cement and paint. So too it is with money; and this has become more evident as transactions have become increasingly virtual. The society opened up by the digital revolution now offers universal means for the expression of universal ideas. Money’s ability to make social connection has been greatly amplified by the internet, “the network of networks”, so that markets, world society and virtual reality feed each other’s explosive growth at this time. Those who wish to work for economic democracy cannot afford to turn their backs on these developments. Yet many of them are unfortunately wedded to reactionary ideologies that owe more to Aristotle and the medieval schoolmen than to contemporary social possibilities. Linton has always regretted the narrow localism that has plagued the movement for ‘social money’ in its first two decades. He is working with a number of colleagues (http://openmoney.info) to pioneer the next phase — developing smart-card technology, new software and multiple domain naming systems as the means of sustaining money on an open source basis. Some of the principles remain the same – the design of money as a closed circuit, the money issued by each participant as a promise to contribute their own goods and services – but others, such as sophisticated communication between circuits, are new. Now individuals may join any number of these circuits at once, reflecting their interests at several levels, not just the local, with a single smart card able to support simultaneously 15 or more of the circuits. It is lonely work and there is still much to be done; but without it ‘social money’ will remain an irrelevance to a world rapidly moving in a different direction. 5:25 AM
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