The constant advancement of mobile telephony brings with it an exponential increase in the effort required to communicate. The phones don’t help save time by simplifying everyday communication; on the contrary – they are time killers. It’s nearly impossible to tear yourself away from your smartphone. At times, you may find yourself sighing at the thought of how people ever managed in the old days to coordinate their schedules, stay in touch with each other, exchange information, or arrange meetings before they even had mobile phones, much less smartphones. If we can barely manage, how bad must it have been for them back then!
It sounds like a bad joke, but where is the fallacy? It seems to be a misinterpretation of cause and effect: one envisions the wildly proliferating, confusing, time-consuming communication structure that we are stuck with today, extracts the smartphone from this tangle, and then looks back and sees a wildly proliferating, confusing, time-consuming communication structure lacking a prime method of coordination: the smartphone. The smartphone had to be invented in order to get to the state we find ourselves in today.

We might call this circular reasoning “absence as argument” (Why do we have mobile phones today? Because we didn’t have them back then and their absence made their invention necessary.). Or, inversely, we might call it the “expediency argument” (the mobile phone was invented in order to simplify communication). This example makes it very clear that the mobile phone’s achievement – the services it provides – is mistaken for the reason for its existence, whatever that may be.

This sounds very simple. However, it becomes incomprehensibly difficult when the subject is a different “medium”: money. In fact, the textbook explanations of what money is and why it exists are constructed using the same kind of circular reasoning involved in “absence as argument”:
“According to the most common explanation of money in the mainstream economy, it works as follows,” elaborates the economic critic Alexander Schomandl. “A money economy implies a complex trade structure. If we remove the ‘organizing principle’ of this economy, namely the money, this economy regresses to the ‘unwieldy’ barter system and becomes ‘inconvenient.’ Therefore, money is supposed to have been created as a way to simplify trade. The mistake in this ‘deduction’ of a circumstance being defined by something absent within it is the assumption of absence. How should the one who imagines the absence know what it was that was missing? He only ‘knows’ because he pulled the ‘last puzzle piece,’ whatever it was that the circumstance lacked, out of the ‘finished puzzle,’ the complete circumstance, only to fill the hole again by replacing what he had pulled out in order to make the picture ‘complete’ again. But the only lack was in his abstraction.”

Adam Smith attempted to use historical examples to show that money actually originates from barter, because without money, exchanging goods would be much too complicated. His historical examples, however, have long since been exposed as imaginary. The historical origins of money lie not in barter, but rather in religious sacrifice – money was originally intended for use as a symbol in sacrificial offerings. And Marx was not alone in his understanding that the term “wares” is inseparable from the concept of money. There cannot have been a trading of wares before the money economy, because money and the associated thought patterns are what create in the first place the classification of any given object or service as a ware, a purchasable thing whose value can be calculated. Last but not least, the financial crisis of the past several years has demonstrated to even the most casual observer that money is not some cleverly imagined value reference to help bring order to unclear market proceedings, but rather an end in itself. For how could a mere referential tool ever bring a real economy more or less independent of it into such dire straits?

Evolutionary Explanation
David Graeber starts off his book Debt: The First 5000 Years with a critique of Smith’s barter paradigm. He links the historical rebuttal of Smith with the logical one. This is undoubtedly one of the most solid chapters in the book. What is maddening, however, is that although Graeber’s 500-page tome was undoubtedly the top work of nonfiction of the past year (earning its shy yet shrewd author a huge wave of media hype), and reviewers welcomed his presentation of debtor-creditor relationships as a form of dominion, the decisive chapter refuting Smith went virtually unnoticed.

This might have something to do with the inconsistency of Graeber’s analyses. The book itself focuses its attention primarily on debt. More precisely, it examines how something that promotes community – everyone is in everyone else’s debt – can instead provoke the exact opposite effect: the destruction of community. Reading with this intention in mind, the examination of Adam Smith comes across like a college prep course, or like ideologically critical foreplay, after which things get hot and heavy. Nonetheless, Graeber has de facto written a book about the enforcement of state power. At times, debt is the medium of power, and at other times, it exists only as an inferred value; and sometimes debt is what makes state power possible in the first place. Here, Graeber mixes various narratives. The reviewers, perhaps understandably in light of today’s economic crisis, flock to the analysis of debt. Consequently, the derivative general critique obliterating Smith’s idyllic vision of the genesis of markets and complex trade relations recedes from view. Although Graeber does criticize the barter paradigm, he replaces it with the debt paradigm. Along the way he stumbles into a circular trap or two himself, or, better, into the cul-de-sac of eternal linear evolutionary explanations. This is hardly noticeable, because Graeber has made his book so entertaining – so entertaining that it can in turn become tiring as he switches rapidly between anecdotes of all kinds and theoretical reflections and discussions of other research literature. He falls short of the radicalism of the Smith chapter time and again, forcing us to assume that it is less of a central topic.

Graeber is an anti-authoritarian, a critic of domination; he is not appeased by the buzzwords of Western progress such as “freedom” and “justice” and continually questions what power structures they embody. He invariably depicts debt as negative, in discordance with “debtism” theorists whose arguments are quite similar to his. The most elaborately described form of debtism can be found in the countless works of the “property economists” Gunnar Heinsohn and Otto Steiger, the most popular in Paul C. Martin’s Der Kapitalismus. Ein System das funktioniert (Capitalism: A System That Works, 1986, with Walter Lüftl). Incidentally, Martin was once the vice editor-in-chief of the German tabloid BILD. Debtists put forth the idea that money was preceded by credit: before money, there was a fictional currency of credit bridging the gap between now and the future, which made it possible for property-owners to put their property to productive use. Debt, therefore, is a principle of progress, but in the form of sovereign debt it can conversely be paralyzing. This happens when sovereign debt blocks the unregulated freedom of private initiatives.

The step from there to Graeber is small, but the political differences are enormous. Even so, Graeber doesn’t exceed the level of structural argumentation applied by the debtists. He describes the collision of “human economies” and “commercial economies” thus: human economies also use money, but only on their fringes or extremes (debts can be represented with money, but this money can never be measured in real bodies; one is never forced to sell his children). Commercial economies recognize the universal structure of money and can thus honor debts using money, and money can also buy slaves. This tells us, says Graeber, that slavery is the logical consequence of taking a human out of his network of mutual obligations. In commercial economies, mutual obligations have been replaced by money, which is involved in every social decision one makes, either directly (labor for money) or indirectly (reproduction, consumption). The dissolution of the human economy thus assumes a commercial one, as Graeber himself says. But how, whence and when, did it come about? What external pressures were applied to transform it into the terror machine that in turn goes after other communities?

The same problem comes up when discussing how legal tender came to prevail. Alexander the Great pares his army down, and that is what makes it effective. He spares himself the laborious task of feeding his troops by simply paying them. They are then able to feed themselves in the conquered lands. Because the troops utilize money, the conquered lands and the wealthy must bow to this logic: markets emerge, communal economies are dissolved. Here too, though, it’s a chicken vs. egg mystery: Did Alexander implement money to better exercise dominion over other lands? Or is he able to implement money because he had already conquered those lands?

Graeber’s analyses could have been more stringent had he, if you will, kept his original anarchist agenda more clearly in mind: Market economies are not possible without state power and their accumulation of capital is not the result of clever managerial decisions to develop untapped markets; rather, such economies come about before the (historical) backdrop of slavery, which could only have been acted out by a (foreign) centralized power. The state cannot exist without capital, and capital cannot exist without the state – we could thus brutally abridge the book’s formula. At least that way, one would have something in hand to combat the recent outbreak of derivation-mania amongst Marxists (an exhausting “state derivation debate” that already took place in the 1970s).

Graeber wants to do more, though; namely to pin down the historical innovation called money, which defies all linear evolutionary explanations. In his attempt, he overshoots the mark, skipping over the form of money and landing at debt, which predates money. The debts Graeber hunts down and so virtuously cordons off from the moral/existential attitude that “everyone depends on everyone else and is therefore also obligated to everyone else” are, however, transmitted monetarily. He tries to construct a causal relationship when one must in fact speak of equiprimordiality, to use a word of Heidegger’s. “In this debt theory of money, one thing is constantly being overlooked. Debtor-creditor interactions are endlessly being created through buying and selling and are therefore part of the concept of money itself, yet are also inferred phenomena resulting from it. If one invokes earlier historical forms of ‘debt’ before monetary transactions, they have a completely different significance and cannot explain the meaning of money as money. However, if they are monetary forms of debt, they trivially and circularly presume the concept of money and are unable to explain it. It’s the other way around: only when we have understood the debtor-creditor relationships formed by monetary transactions can we recognize historical precursors.” Thus did Karl-Heinz Brodbeck comment on the dilemma. He has addressed the cul-de-sac of the derivation of money in numerous publications, most recently in Phänomenologie des Geldes (Phenomenology of Money).

Debt: The First 5000 Years is without question currently the most attractive offering for those interested in exploring anarchist theory. Yet it waters down its own agenda by swinging back and forth between a critique of state power and attempts at evolutionary explanations. Graeber evidently doesn’t want his book to be seen as a fundamental critique of money. And for that reason his critique of domination is likewise subject to scrutiny.

References
David Graeber, Debt: The First 5000 Years, Melville House, New York 2011.
On sacrifice theory, see Bernhard Laum, Heiliges Geld. Eine historische Untersuchung über den sakralen Ursprung des Geldes, Berlin 2006 (first published in 1924) and Wilhelm Gerloff, Die Entstehung des Geldes und die Anfänge des Geldwesens, Frankfurt am Main 1947.
The quote from Alexander Schomandl is from his brochure Die neue trinitarische Formel: Eigentum schafft Zins schafft Geld, which can be ordered at mmrgmbh@aol.com. It is based on Schomandl’s doctoral thesis: Wert, Geld und Kredit in der Theorie von Karl Marx. Zu monetären Aspekten der “Kritik der politischen Ökonomie” (Neuried 1985).
Karl-Heinz Brodbeck’s Phänomenologie des Geldes, from which the above quote was taken, is available to download at www.khbrodbeck.homepage.t-online.de (menu: Downloads/Ökonomie). Brodbeck’s main work is Die Herrschaft des Geldes. Geschichte und Systematik, 2nd edition, Darmstadt 2012.
The fundamental work by Gunnar Heinsohn is Privateigentum, Patriarchat, Geldwirtschaft. Eine sozialtheoretische Rekonstruktion zur Antike, Frankfurt am Main 1984.

 

Translated by Jennifer Taylor

 

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