I was reading the Economist today when I was granted a flash, a fleeting glimpse, at insight into the tenuousness hold on reality that we give money.
There was a passage in an article on the Anthropocene, the geological period in which a growing number of geologists assert we are living, a time where the geological processes of Earth are subject to massive and artificial influence by human activity, so much so that we have pushed ourselves into a time in Earth’s history that, when examined thousands or millions of years hence by future geologists, will be marked as distinct from others. Why not make that distinction now?, ask some geologists. That was their flash of insight; mine was based, again, on the tenuousness of money.So the passage I came across had something to do with people shipping fossil fuels from one part of the planet to another. And, reasonably though uncharacteristically, I asked myself exactly why one would send a tanker vessel on the high seas from, say, Oman to New Orleans? Well, money, of course, is the correct answer. The person in New Orleans is willing to pay the person in Oman for that oil in dollars or perhaps a basket of currencies. But what led me to ask that question was a glimpse at the lopsidedness of the deal: The oil can be burned and the heat energy used to power useful machines. The money cannot be.
Of course the person in New Orleans importing crude oil will not burn it himself; he will sell it to refineries for their dollars, which he will use to buy more oil and perhaps a nice car, boat or RV. Up to the far end of this money spectrum, not too far from New Orleans, is the clear winner in this transaction, the person who ultimately exchanges paper dollars in return for useful refined oil, put to work in his or her zippy automobile.
On the other side of the world, the people in Oman will likely have not dug up the oil themselves, they will have used their dollars to pay someone else to do it for them. And it is here that we reach the losingest end of the spectrum, the person who carries out the most useful labor — extracting the highly useful oil — while receiving in return what would be, without the tacit agreement of almost every man, woman and child in the world, useless paper dollars.
There is no agreement among humankind of whether oil or food or water or clothing has value; we agree on fluctuations in these things’ costs, but that they have value is made implicit when we put them to work. They require no agreement, no legal fiction among people to work, they are not promissory notes; they just work.
There have sprouted, from this agreement that money can be useful, any number of obstacles to a clear, concise indictment of its use. The person who extracts oil from the ground puts his work (in the definition of physics) to use in return for dollars which have value and are useful in that they can be exchanged for things of inherent value like food and shelter. I do not mean to say that money is useless, just that its usefulness is entirely fabricated, a human construction that has become so ingrained in almost every culture in the world that we now easily confuse it as at least as valuable as oil and food.
I was merely afforded a glimpse of its true nature is all.
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