I just finished reading Religion: The First 5,000 Years by anthropologist David Graeber. The book takes a look at the history of money and debt and how they relate to societal structures from a lens that departs significantly from the conventional wisdom of economic thinking.
Conventional wisdom paints a picture of people inefficiently bartering goods and services directly with each other, and money naturally arises as a result of the problems inherent in this. Graeber unpacks this narrative by looking at anthropological history. Simply put, primitive societies shared their resources freely with each other, living a communal lifestyle, rarely bartering, and only in the context of separate communities interacting with each other. It played no role in the internal affairs of early societies.
Money, as in commodity money, only began to be used in rare interactions between castes over great distances. The economy in local areas did not begin to use such mechanisms of exchange. They used credit. Credit is operated and supervised by the government, as in ancient Sumer. This system arose from the informal “credits” that people took into account when sharing resources in more primitive societies. But it was formalized and maintained through the power structure of the Sumerian government and temples. No money would change hands during the exchanges, as people would simply record debts stored in the temple, periodically settling their obligations with actual consumer goods.
Religion came before coinage, and was created and maintained on a large scale by the state. Commodity money did not come until later, minted and distributed by the state again, as trust-based civilizations on a large scale collapsed and gave way to warring imperial states. Debt and credit have little meaning in a time period of constant war and roaming armies, with no certainty at all that they will come back to settle the debts moving on.
Since then, with the anomalies of the modern era and central banks, human societies have oscillated between virtual credit money and coins depending on whether or not the era at the time was mostly based on large-scale wars and conquests. The same patterns repeated across the ages as well, as people created their own informal and local credit networks after the fall of large coin-using empires, and government slowly inserted itself into these networks to mediate, and coins inevitably returned with the rise of violent empires.
Bartar, as traditionally taught, was not actually part of this process of money development, and the state always had a direct involvement in shaping monetary systems and markets.
I’m sure a lot of people have been incredibly moved to read this, but Graeber’s case is very strong and built on actual historical and anthropological evidence, rather than speculation. Especially the idea that Chartism has a more valid basis than many in the field would like to admit.
This actually makes Bitcoin more profound for me. Bitcoin is not simple Back to Stateless money, I don’t think anyone was really there after reading Debt. Bitcoin is the first Stateless money ever existed. To me, this makes it a tremendous achievement and a historic transformation.
Regardless of your economic leanings, I recommend you read this book. It will give you a lot to think about in the context of Bitcoin.
This article is a takes. The opinions expressed are entirely those of the author and do not necessarily reflect the opinions of BTC Inc or Bitcoin Magazine.
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