Thursday, March 7, 2013

Debt: The First 5,000 Years, by David Graeber (author), Grover Gardner (narrator)

Gildan Media, January 2012

This is an amazingly lively, interesting, and provocative history of debt, money, and credit systems that may upend assumptions and beliefs you've taken for granted.

One of the most basic of those assumptions is that, prior to the invention of money, people relied on barter to trade the things they had in excess for the things they needed. This would have been enormously cumbersome, and that, in the traditional version, is why money was invented. The problem is that there is no evidence to support this theory. No society has ever been found, anywhere, that relies on barter as a primary way of trading within the community. Barter is only ever used with strangers, or in societies that normally use money but have experienced a temporary  break-down in the availability of money. It's stop-gap, not something people do routinely.

How do people trade among themselves when their society doesn't have money? Oddly, the same way we do now: through elaborate credit arrangements. Henry needs a pair of shoes; John makes shoes. Henry has potatoes, which John doesn't need right now, but Henry, John, and all their neighbors are perfectly capable of remembering that Henry owes John the value of a pair of shoes. Traditional societies have many faults and are by no means idyllic Edens of perfection, but there is an assumption that of course everyone needs to have the essentials of survival, and that this is a community concern, not solely an individual concern. Everyone helps others, because everyone is going to need help from others. What goes around, comes around. Competition, anger, greed, resentment all exist, but sociability is the key to survival.

The really interesting bit, and the meat of this book, is how we get from that, to money-based economies, and how this affected not just economics but every part of human life. One crucial factor is the connection between armies and militarism, and the need to supply those armies, and the invention of coin. The three basic ways of supplying your army are to maintain really long supply lines, to loot the countryside they're marching through, or to buy supplies along your army's route.

But the people in the country you're marching through mostly have no reason to share resources with your army, who aren't part of their community. And carrying trade goods in quantity is just a different version of the "long supply lines" problem.

Small and portable bits of gold and silver, though, are usually acceptable and tradeable everywhere.

Once coinage is invented and accepted, everything gradually acquires a price, including people--and even intrinsically non-tradeable things, like parent-child relations, begin to be talked about in terms of credit, debt, and price.

This is a thoughtful, interesting, informative, and highly readable book, well worth reading regardless of whether you ultimately agree with Graeber's thesis.

Highly recommended.

I borrowed this book from the library.