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The topic of this essay is ethics. As background I will provide a brief summary of the conclusions of the first essay in this “Invisible Hand” series which examined the physical object nature of our money and some of the unfortunate consequences of that nature. I will be concise so if you have already read one or more of the earlier essays don’t worry, this review won’t take long.

All money in history (and pre-history) has been considered to be or to represent physical objects such as a basket of grain, a cow, a coin, or a paper bill. Today most money is in computer accounts and though it zips around the world from account to account at almost the speed of light, it still is treated as if it were a physical object of some sort. Because we treat money as if it were a physical object, anything which is true of physical objects in general will also be true of money. This obvious point is ignored by economists and others who talk and write about money even though it is the most important truth about money. The importance of the physical object nature of money cannot be overstated. What follows are some of the consequences of that physical object nature.

First, money is like other physical objects in that it can be taken from its owner against that owner’s will; by force, fraud, or stealth and it can also be lost or destroyed. This means that you need to suspect almost everyone of trying to get your money by fair means or foul.

Second, money must be amoral because all inanimate physical objects are amoral. Even animals are amoral, in that they have neither an ethical sense nor morality, especially when they are used as commodity money. You can use your physical object money for anything, good or bad.

Third, the money supply is independent of the supply of goods and services for sale because the supply of one physical object is independent of the supply of other objects.

Fourth, money falsely simulates a zero-sum game in monetary transactions because the money gained by one party must be lost by some other party or parties. Money makes us think that other people can gain money at our expense and that we can only gain money at their expense. It makes us treat others as if they were competitors, rivals, opponents, or even enemies.

Fifth, money is almost impossible for a society or nation to control. In every nation that attempts to limit, regulate, or tax trade a black market comes to exist; and organized crime flourishes in all nations.

Sixth, money transactions are two-party interactions. Two-party interaction is inherently unstable because if one party gets an advantage in power such as having more money, the stronger party can use that power to gain still more advantages. This is particularly true of money. The old saying “them as has, gets” is true. Possession of money does make getting more money quite a lot easier. Naturally, the weaker party in such two-party interaction will eventually want to end the interaction. Thus the relationship is unstable.

Keeping that review in mind, let’s consider ethics and ethical systems.

As usual, we’ll begin by turning to Wikipedia and its page on ethics. It turns out to be quite a large page with many concepts and many categories. We will not go over all of these concepts and categories, although I will express several qualified personal opinions based upon my own understanding of many of these ideas and classifications.

Ethics QUOTE “is a branch of philosophy that involves systematizing, defending and recommending concepts of right and wrong conduct, often addressing disputes of moral diversity.” UNQUOTE. Here I would like you to notice that ethics concerns conduct and human actions, and that there can be right and wrong conduct. I hope we can all agree that what constitutes right and wrong is subjective, that such considerations vary from person to person, from culture to culture, and from nation to nation.

Ethics is a huge field of philosophy and I really don’t want to deal with all of it, just selected parts and I am sure that you would not want to read an essay from me dealing with all of ethics. So let’s whittle down the subject to a more manageable set of ideas. First off, we can eliminate meta-ethics or considerations of how we understand and know about right and wrong. I am not really concerned with what actually is right and wrong in reality today though that’s an interesting subject.

Secondly, we can skip virtue ethics because that’s internal to the human mind and we are dealing in this series of lectures with human interaction. In fact, most of the old Greek and Roman categories of ethics such as Hedonism, Epicureanism, and Stoicism we can skip as well because these are largely attempts to tell the individual what state of mind will be most pleasant, happy, enjoyable, or what have you.

Third, we can skip those sections of ethics which purport to determine goodness or rightness such as Deontology or role ethics or postmodern ethics. Again, we are not attempting here to determine what is good or bad behavior.

So what do I propose to consider? I propose to consider ethical systems. That is, how societies bring about behavior which can be considered right or wrong. Note that in this approach, we are not considering an ethical system to be just a set of related prescriptions or proscriptions for behavior. In other words in this presentation I do not consider the Ten Commandments from the Christian Bible to be an ethical system because those commandments, by themselves, involve no social means or mechanism to bring about the required or prohibited behaviors. By itself, the Commandment to honor one’s mother and father does not result in persons honoring their parents. By itself, the Commandment thou shall not kill does not prevent killing. It is only when some social mechanism is added to such commands that we generate a system of ethics.

Ethical principles without some means to generate the appropriate behavior are mere air castles. They may be fun or even rewarding to think about, to discuss, or even over which to have debates. But they don’t bring about moral behavior. It’s like having a car with wheels including a steering wheel, brakes, windows, a fine stereo speaker system and a beautiful shape and color but no engine. Without the engine the car is pretty useless for getting around.

When looked at in this way, we can see that modern societies and nations have quite a few ethical systems. We can consider the legal system to be such an ethical system. A nation will produce laws, often through the use of a legislature or, perhaps, through a ruler making demands. The nation will have some sort of criminal justice system in which human behavior is observed, some of that behavior is considered to be in violation of the law however propounded, and action is taken to punish in some way the person (or other person-like entity) who committed the “crime.” Thus we have a set of required behaviors and a social mechanism to punish failures to act in accordance with those required behaviors.

We also have the Church in many nations. Or we could have a nation with many different churches. In either case, the Church will have a set of required behaviors for its members. This may include many behaviors which are also regulated by the laws of the nation. But typically, the ethics of the Church will include many behaviors ignored by the law. Of course, many years ago in ancient Egypt, for example, the Church and the State were one so the ethical system of the Church was the law. But as you might imagine, it may be that the Church and the State may conflict in their ethical systems.

Within a nation there will be many layers of ethical systems. Each family will have rules which its members are expected to follow. “It’s your job to take out the garbage.” These rules and the sanctions which follow compliance or non-compliance are aspects of the family’s ethical system.

Again, the rules of the various ethical systems may clash. The ethical system of the NFL may clash with the ethical systems of the Church. The ethical system of Wall Street may clash with the law’s ethical system. The ethical system of Congress may clash with the U.S. Constitution.

You can see from the examples above that ethical systems abound. In hunting-and-gathering societies there may be only the family’s ethical system. But with the development of cities and the great increase in the division of labor, ethical systems for different groups and categories of people came to exist with a corresponding potential for a clash of requirements.

This change in technology from hunting and gathering to agricultural, from agricultural to industrial, and from industrial to information economies has resulted in changes to ethical systems and in ever greater clashes among and between people with differing ethical systems. Things have become far more complicated ethically speaking, and this complication has resulted in each generation bemoaning the lack of morality of the younger generation, of kids just not being as ethical and moral “as they were when I was a child”. This common sentiment is a product of the changes brought about by progress in technology. The situations and conditions in which we live are simply different from those of previous generations.  Ethics will change and adapt whether we like it or not.

Some ethical systems are clearly more important and others less important. The ethical system in your family is extremely important to your happiness and well-being. The ethical systems at your place of work are also very important to you. The Church and State ethical systems are probably of lesser importance to you in your daily life. The ethical systems of occupations that are not your own, of groups of which you are not a member, or with which you have only occasional contact are probably not going to be very important to you.

I imagine at this point you must be asking, “When are you going to relate all this ethics stuff to money?” I was beginning to wonder myself. But now seems to be a good time.

Remember that an ethical system is both a set of rules for behavior, whether formal or informal, plus a means by which that behavior is brought about. Well, it turns out that the use of physical object money or POM constitutes just such a system. POM use, believe it or not, is an ethical system.

“Now wait a minute” I hear you cry. “Didn’t you start this lecture off by writing that the second consequence of a POM was that it was amoral?” And I must agree that I did write exactly that. But there can be all sorts of amoral things in any ethical system. I am sure you have noticed that there are many rules for accounting and bookkeeping. If you embezzle money from your company by violating those rules your company will attempt to punish you in some way. Even though the physical objects or representations of physical objects are amoral, the rules for the use of and handling of those amoral objects can constitute the rules part of an ethical system.

As I am sure you have noticed, there are rules for how one is to handle and deal with money. Because money is involved in many conflicts among and between people, the law in every nation concerns itself with what is permitted and what is required with respect to money interactions. Foremost among these legal interactions is the body of tax law. The Church will also typically have expectations for giving money to the Church expressed as required behaviors. There is both law and custom or informal expectations concerning the use of money within the family. One is required to care for one’s children and other dependents, for example. So it’s clear that ethical systems in our societies of the world which use money do have ethical and unethical views of how one acquires and uses physical object money.

Perhaps you recall those consequences of the physical object nature of money that I rattled off at the beginning of this lecture. Those consequences affect and influence the society’s ethics and how those ethics are enforced in all of a society’s ethical systems. Our many societal ethical systems will address what one is to do with money and what one is not to do with money because the interactions among human beings involving money are seen as being important. But the influence of POM is also subtle. It shapes how we define our situation, our context, and our circumstances.

So let’s take a simple case and examine how the nature of POM influences events. We’ll start with “Thou shalt not steal.” The Ten Commandments, taken by themselves, are a set of moral prescriptions or commands for behavior. The Christian Church takes actions to make the Commandments part of its ethical system. It attempts to get people to not steal. We are aware that theft, stealing, has existed for many thousands of years. We have evidence of stealing in many cultures. In fact, stealing takes place in all cultures which have property. (There appear to be a few cultures which don’t bother with that concept.) So the question arises, did the Commandment to not steal have any effect on the incidence of theft? So far as we can determine, the Commandment has had no discernible effects on the incidence of theft. In fact, as time has gone by, the rate and frequency of theft has increased over the years. Note that we are not talking just about stealing money but also about stealing other kinds of property including intellectual property. If some item of property is valuable, then that property can be exchanged for POM. In this way, the thief no longer possesses the property which would be evidence of his guilt and has acquired POM which can be exchanged for the many things the thief may want or need. POM thus provides an increased motive for theft and makes the detection of the guilty more difficult. But let’s say that the thief is caught. The thief can attempt to bribe the arresting officer: This subverts the ethical system. Assuming that attempt fails, the thief is imprisoned. This is very expensive and greatly reduces the potential for productivity of the thief and the economy. The thief is brought to court and is represented by an attorney. If the thief has enough money, that attorney will be highly skilled. If the thief is poor, the attorney will most probably provide a very weak defense. Some attorneys might attempt to bribe one or more members of the jury or the judge. Organized criminal groups often have considerable influence along these lines.

At each step in the process from original temptation to steal all the way through to the ending of years in prison, POM has its effects and influences. In no case is the influence one of which the ethical system would approve. POM prevents and subverts the efforts of those who work to support the “theft is illegal” law. Now let’s see how POM affects the Church with respect to violations of the Commandment. We have ample evidence that over the hundreds of years that a Christian Church has existed, people who possess abundant wealth and property have been treated better by the Church than those who are poor. Perhaps one of the most blatant examples of this favoritism is the selling of indulgences by the Catholic Church hundreds of years ago, before Martin Luther’s time. Historically, one of the most common means of becoming rich has been to steal. Alexander the Great stole a huge amount of gold and silver from the Persians. Spain stole tons of gold and silver from the Native Americans. The Robber Barons of the U.S. in the late 19th century stole their way to wealth in a variety of ways. All these people who became wealthy by theft were praised and rewarded by the Churches of their day and place. In other words, POM seduces the Church into supporting and rewarding those who steal.

Well those were and are blatant instances and examples of POM subverting ethics. But POM is subtle and ubiquitous as well as blatant. POM seems to be involved in places and circumstances where one would least expect it. Picture, if you will, a tragedy with children homeless and hungry. It would appear that any ethical system, legal, religious, family, even business or political, would have aid and assistance rushing to help those poor children. But what do we find? We find people vociferously objecting to helping those children. I see images of people gathered together carrying signs with hateful messages of rejection. Those frightened adults with their messages of hate have been convinced by POM that those children, homeless and hungry as they are, constitute a threat. Those adults fear losing money, physical object money because POM can be taken from them against their will.

Or a young couple on their honeymoon is deeply in love. They think ahead to the future, and as they discuss their plans it becomes apparent that she wants a career but he wants her to say at home and raise children. Here we have POM dividing and conquering. She concedes because she loves him and cannot bear to see him angry with her. He promises to provide for her bountifully. To earn more money he cuts corners at work and does other things to get ahead that violate the ethics of his profession. She scrimps and saves to make ends meet in the home. She must ask for money and he resents not being able to spend the money he earns on expensive toys like the executives above him in the company hierarchy do. So he becomes grumpy and they argue over money thus eroding their love. The expenses of having a baby surprise them both but they know they will need insurance, both health and life in the event of disaster or just bad luck so they cut back on their standard of living and go into debt even further. After several years love is gone. The husband is not getting the affection from his “spendthrift wife” he feels he deserves so he begins a series of affairs which further erode the family finances. The wife takes her revenge in various ways, most of which cost the husband money. Eventually, the couple divorces. The wife tries to get back into the work world but her skills have become outdated, and she is forced to take work far below her ability level. The child support payments, often late, are a serious bone of contention, and occasional trips back to court maintain the anger and resentment by both parties. Naturally, the children cannot avoid becoming involved and feeling guilt for the anger over their support payments and feel fear of being abandoned and doing without. That zero-sum game simulation is hard at work and benefiting from the two-party interaction from which he gains all the power. It’s hard to maintain love with high levels of stress and the feeling that the other person is not on your side.

POM makes people feel like enemies, rivals, competitors. “Winning” becomes more important than being ethical. None of the ethical systems – whether state, religion, workplace, or family – is able to actually bring about consistent compliance with the ethical norms. In every case throughout history, these ethical systems have failed consistently and repeatedly.

But POM has succeeded as an ethical system in maintaining itself at the expense of those other ethical systems. POM easily produces the behavior associated with its rules. People count their money frequently. People seek high-paying jobs. People will do almost anything for money. The fundamentals of accounting and bookkeeping are well known and taught around the world. There are all sorts of customs and traditions relating to money that are followed, like it’s rude to ask someone how much money they have or how deeply in debt they are. In other words, the POM ethical system is more powerful than the law, the church, the job, and the family. As money interaction has become more common over the centuries the power and influence of money has similarly increased. Hundreds of years ago a person might engage in a money transaction only a couple of times a year since working on the farm and trading with neighbors provided almost all the goods and services one might need. Even churches and doctors would accept farm products as contributions and payments. As a result the family tie was much stronger. The Church could dominate behavior in the community. The state was far away and a remote consideration. The guild dominated tradesmen. So these various ethical systems were much better able to resist the powers of money. If you had a problem, your many friends would help. If you lost the good will of your neighbors you might as well leave the community. This isn’t the case today.

Today one spends money every day. If you have utilities in your home you incur debt and probably pay those bills monthly. If you have credit card debt or mortgage debt the interest you owe increases daily. You buy groceries and meals in restaurants. Almost all of your needs are met via financial transactions. To get this money you must have a job or some other source of income. But however you get by, money is of vital interest to you. Our tremendous, obvious, mutual interdependence is mediated through money: through a POM. People who do not have or control money are considered to be dependents. Therefore POM is pretty much the most important thing in the lives of most people in a modern economy. Would you be surprised to overhear any of the following comments?

“I can’t come home and take care of the kids tonight, dear, my boss wants me to work late.”

“I’m just doing my job.”

“That’s not my job.”

“I can’t quit. I’d lose my health insurance.”

“I’d like to major in English but I’d never be able to get a job with an English degree.”

“I hate my boss.”

I think you can see how the POM ethical system is able to overwhelm the requirements of other ethical systems. And since POM gives the impression that others are our enemies, that others will try to take our money by any means fair or foul, that if you give them an inch they’ll take a mile… it’s no wonder we treat each other badly even though other ethical systems say that we should treat each other nicely.

Of course with a non-POM everything would be different. (That doesn’t surprise you, does it?) Non-POM is also an ethical system. To place the non-POM ethical system in the right category of ethical systems we would have to say it was a consequentialist system with strong utilitarianism overtones. With non-POM, however, most other ethical systems are supported. There’s almost no state left with a non-POM so other than international relations, there are no legal or governmental ethics to worry about. But the ethical systems of the Church, involving the Ten Commandments in the Christian religions, those systems would be supported. Non-POM rewards being kind to others. Non-POM cannot be used to harm others. Therefore people who are earning lots of money are most likely being ethical in line with the Church’s ethical system. If we consider occupational ethical systems, we find a similar result. Every occupation earns non-POM by benefiting others. Being efficient, careful, thoughtful, and accurate helps in almost every occupation and maximizes benefits and thus earnings. Within the family, being good to each other and taking good care of each other – especially the children – earns money also.

But viewing it on a far more fundamental level, down at the subconscious level, the differences between a POM economy and culture and that of a non-POM economy and culture: the contrast is striking. What does your subconscious say about strangers? I’ll bet that there’s some fear there. How about persons of a different faith. Does your subconscious trust them? What about someone who doesn’t look like you, someone of a different skin color or hair type or different clothes or, well, whatever distinguishes between how we look and how they look? Those others are scary, right? All the reasons for discrimination and ethnocentrism are based upon that subconscious fear. That fear begins young. Babies at about 8 months of age have learned to notice that momma looks different than other people and those others are scary. It’s called 8th month anxiety. It takes a while for the child to learn to have confidence that other people will also be nice. In school, children who are different get picked on and made fun of. When teachers grade, or job applications are considered, or club memberships offered, the appearance of the subject matters. This discrimination has subconscious roots and is then justified or rationalized by the conscious mind. One could therefore say that it’s a part of human nature. One could say that but one would be wrong. You see there are an enormous range of differences among and between human beings, even identical twins. Yet we employ only a few of those differences when we discriminate against others. If it were human nature to always discriminate no matter the circumstances then we would say it’s just human nature at work. But when the discrimination is very context-dependent then it isn’t just human nature. It’s human nature in that context. If we change the context, we change or eliminate the discrimination. Non-POM changes the context fundamentally.

Let’s say you see a stranger approach. How does that make you feel? Scared? Excited? Hopeful? How you feel depends on the context. If you are alone on a dark street in the bad part of town you should reasonably feel scared. But what if that stranger is dressed as a nun or as a policeman? If you are a black teenager perhaps that policeman is a reason to be scared. If you are a white businessman probably that policeman is a reason to feel relieved. If you are a salesman and that stranger is a potential customer entering your shop then you will probably feel hopeful. How you view a stranger is extremely context-dependent. Remember how POM shapes the context? Well non-POM shapes the context in the opposite direction. Non-POM says that stranger is able to earn money by helping you and will lose money by harming you. Non-POM says every stranger is an opportunity to earn money. Non-POM says that you can always get help from other people. Non-POM says that the more other people know about you the more likely they are to be able to help you effectively. Non-POM says we’re all on the same side. Non-POM says that no one can take your money against your will. Non-POM says no one will try to cheat you. Non-POM says your identity is something to reveal rather than to keep secret.

So the expected behavior, the good things to do with non-POM ethics are those actions which benefit others. And the system part of non-POM ethical systems is the means, the social mechanism by which people earn non-POM for producing net benefit for others. That converts the mere injunction to do as much good for others as you can and do as little harm to others as you can into an ethical system. The knowledge that good behavior will be rewarded in the here and now and that bad behavior will not be rewarded and will, in fact, reduce one’s rewards not only gives each person a motive to behave well but tells them that everyone else has that same motive. That last part, that you know that everyone else has the same motive, is of major importance in understanding your context and circumstances. That part of the non-POM system is what makes your subconscious mind view the world and other people quite differently. Your subconscious will learn that almost anyone can be trusted and can be expected to help willingly and happily.

This change in your subconscious point of view of is huge in its favorable consequences. Your stress level will be reduced significantly, and your health will be better as a consequence. You’ll be able to learn things more quickly and easily, focusing better on what you need to do. You’ll be less prone to anger because you will be less fearful.

Try thinking of all the things you are afraid might happen during the next year. How many of those things involve money? What if you knew for sure that none of those bad things that involved money could happen? Would you have less stress in your life? Yes, that’s true for me, too.

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