By Dan Kervick
Where We Can Go from Here
I have asked the reader to follow me through a lengthyseries of reflections and thought experiments on the nature and role of moneyin modern economies. Some might ask whythis issue is so important. How canthese ruminations on the nature of modern monetary systems help guide ourthinking on the task of building a more fair and decent society of democratic equals? How can they help us create a society inwhich democratic solidarity trumps self-regarding and avaricious greed, and inwhich broad and shared prosperity replaces the concentrated economic privilegeand supremacy of the few?
It is important to keep the political problem of money inproper perspective. No one needs to bereminded that money plays an incredibly significant role in modernsocieties. But it is also important notto overrate the role of money. The mostimportant reason to reflect on the nature of money is that by doing so webetter understand all those things that are notmoney, all of the sources of real and non-instrumental value in the world thatare the ultimate ends we seek and the ultimate sources of our happiness. And as we improve our understanding of thepurposes served by money and monetary systems, our improved understanding canhelp liberate us from our dependency on monetary systems controlled by thepowerful.
Clearly money is just an instrument: a tool that helps us to organize our economiclives. It is used for assigningquantitative values to the real goods and services we produce. It assists in the production, distributionand exchange of those goods and services, and in the prudent storage of valueand purchasing power over time. Amonetary system cannot be separated from the larger economic and social orderof which it is a part. A moredemocratic monetary system will therefore be part of a more democratic economicsystem and a more democratic society.
The cause of genuine democracy will, of course, requiresteps that go well beyond reform of the monetary system. If we seek a more democratic society, one inwhich decision-making power over our everyday lives and common futures is moreevenly distributed among all of our people, it will be necessary for all of usto embrace the demanding responsibilities of democratic governance. This can be hard to do in the face of somany decades of governmental failure, where government itself has sometimes seemedto have become nothing but a tool of the plutocracy. Some of the tendency in recent history amongdissidents and reformers has been to pull away from one another other ratherthan pull together. Some of us hopeonly to liberate ourselves from government and from one another in order to beleft alone to pursue our individual happiness on our own terms.
This thoroughly individualistic approach cannotsucceed. The cravings for ever morepersonal freedom, and for ever more liberation from the responsibilities ofdemocratic government, will only lead to the eventual dissolution of democraticgovernment and the triumph of authoritarianism. Either we work together as equals to govern our lives and govern oursocieties, or ambitious and ruthless people commanding great stores of wealthwill take advantage of the vacuum to seize control and govern our societies forus. The urge for freedom is natural andpraiseworthy, but the dream of a real and durable freedom that can existoutside the cooperative efforts of a democratic people practicing vigilant andindustrious democratic governance is not the dream of a free people, but thetwilight illusion of a defeated and alienated people who have given up on thekinds of freedom and well-being that can only be achieved through socialsolidarity and teamwork. In the end, we are dependent and socialcreatures, built by nature for social and community life, and for relationshipsbased on love, fellowship and friendship.
We have been living in recent decades through an anti-socialera of greed, separation and inequality. Those of us who have lived this way for a long time might have becomeaccustomed to the norms and practices of this era, and might even haveconvinced ourselves that these norms and practices are appropriate and healthy. But the rising generation of young people,whose natural and healthy sociality and friendliness has not yet been toodamaged and disfigured by the ruthless demands of the system of greed know thatsomething is wrong. They know that our present way of economiclife is disordered and out of balance.
The anti-social era has been marked by a fatalisticpassivity in the face of unregulated commerce and market behavior. But the forlorn era of low socialexpectations is dying; we can feel it. People are tired of being on their own. The defeatist dogma about social change characterizing this dying era isthat we can’t choose our society’s future, because people are too weak andstupid and selfish and limited for collective effort to succeed on a largescale. The future can only emerge in an entirely unpredictablefashion from the crisscrossing patterns of individuals pursuing their own personalgoals without any significant degree of social cooperation orcoordination. The result of this trendin thinking has been a withering of the social imagination and the enfeeblementof the democratic practices of our people.
In the neoliberal world of the past few decades, politicshas become small, unambitious and managerial. This dispirited managerial government presides over a society in whichpathologies of social living are promoted as virtues: radical individualism,greed, ambitions of supremacy, cravings for isolation, hatred of community, anda debasement of healthy human relationships into commercial and exploitativetransactions come to be seen as normal. But the gloomy religions of self-seeking isolation are not justdebilitating; they are dispiriting. AsDavid Graeber has written, “the last thirty years have seen the construction ofa vast bureaucratic apparatus for the creation and maintenance of hopelessness,a giant machine designed, first and foremost, to destroy any sense of possiblealternative futures.”
The fading era of market fundamentalism andhyper-individualism was trumpeted as the “end of history.” But history is starting up again. In theshadow of the current recession, we are beginning to recapture the optimistic sensethat the future is something we can envision and choose. We can work to build a social consensus aboutthe future we want, make large and ambitious choices about the shape of thatfuture and then work with one another in the task of creating the future we haveenvisioned. We need not sit back, wait,and just see what turns up. Thepossibility of a mass democratic movement for profound social change beginswith the recognition that the machine of despair is a lie, and that success isactually possible.
It is starting. Peopleall over the world, frustrated by the dismal and meaningless pursuit ofindividual achievement and material gain alone without larger social purpose, andfatigued by the insecurity, stresses and manic busyness that afflict the neoliberalindividual, are reaching out to re-forge the social contract, establish a newsense of justice based on teamwork and equality, and articulate visions of thehuman future that are a match for the inherent human dignity we sense inourselves and recognize in our fellows. The world that we have passively allowed to be built around us bycommercial frenzy devoid of higher purpose is an assault on that dignity.
It is notable and inspiring that as the Occupy Wall Streetmovement took shape around the United States and other parts of the world, theparticipants in the occupations organized themselves as communities of equals,in which every voice is equally prized and harmonious consensus is avidlysought. The hunger for democraticcommunity and self-determination is palpable. This is not the laissez faire form of self-determination, in which eachindividual strives only to determine the course of one individual life, but amore encompassing phenomenon, in which people strive to build and sustain communitiesand then work together as equals in order to make well-founded, democratic decisionsto determine the direction of the community. It’s hard work. But the work is inspiring and ennobling, andpeople are naturally drawn to it.
In both the United States and Europe, policy-making elites –whose allegiances are to the plutocrats who are responsible for funding andsustaining the political operations of these elites – are aggressively workingto take advantage of the stress and confusion caused by the present globaleconomic crisis to dismantle progressive social systems. They are targeting systems of publicownership and organized social cooperation, and are working to undermine thecapacity for democratic governance. Forthe very wealthy, democratic governments represent nothing butcompetitors. These governments have sometimesacted in the past to diminish some of the formidable power the wealthy wouldotherwise possess over entire societies, and they sometimes even strip them ofsome of the wealth that they have earned from the sweat of others. Plutocrats would like nothing better than toput real democracy out of business, and to leave behind nothing but a toyfacsimile of democracy – something like a high school student government thatis allowed to engage in a little democratic role-playing inside an adult socialinstitution that the students really don’t control.
So the plutocrats have put out a stark and coordinatedmessage through the media channels they control, and through the opinion-leadersthey own and influence. It is a messagedesigned to invoke fear and panic, and to achieve democratic surrender: The message is that we are out of money,that our governments are bankrupt, that they must opt for austerity anddownsizing and contraction, and that we must hand over even moredecision-making to bankers, bond markets and technocrats – the functionaries ofthe plutocracy.
This message is preposterous. Societies build their futures and commonwealth out of the real resources they possess, not out of money. Money is only a tool, and it is the simplestand most inexpensive tool we can make. Modern democracies are very rich in human, material and technologicalresources. We are not “out of” anythingimportant of real and fundamental value. The plutocrats might be out of ideas; and they are running out oftime. But the democratic peoples overwhom the plutocrats are trying to reassert control are only out of patiencewith the plutocracy.
And this brings us back to the issue of monetarydemocracy. The time has come to considersome specifics: What role can money playin building a more democratic society? How should we organize our monetary system so that the public’s money isruled by the public and made to serve public purposes, and is not instead pervertedinto an instrument that primarily serves plutocrats in their drive to rule overthe public? In the final installment inthis series I will propose six tasks for democratic economic reform, each ofwhich has some dependence on the democratic reform of our monetary system.