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This is the first of a series of essays about various subjects which involve money in one way or another.

For some reason money seems to be an important part of our lives and has a lot to do with the circumstances that we deal with daily.  That’s something I hope to explain.

For some years now, libertarians have pointed out several really serious problems with our society here in the U.S.A.  Of course socialists, communists and other statists also point to a somewhat different set of really serious problems here in the U.S.A.  Mainstream politicians of whatever stripe and party point to problems as well, some of which are insignificant and some of which are serious.  But since they are merely trying to get elected and not trying to improve the conditions under which we live or our prospects for the future, we won’t pay too much attention to them.  On the other hand, the average citizen is suffering from serious problems every day.  Those are (or should be) of great concern to all of us.  Why should the problems of the average citizen concern us?  Because we are all mutually interdependent.  That is, everyone depends on other people every day.  If you drive a car you depend on other drivers to not do something stupid and run into you.  If you eat food there’s a very good chance that you didn’t grow that food for yourself.  If you wear clothing there’s a huge probability that you did not create the fibers, weave the cloth, and sew those clothes for yourself.  If you live in a house or apartment you probably did not fashion all the building materials for yourself and assemble them for yourself using tools you created from scratch for yourself.  And none of us invented the language we speak.  So we all depend on other people.  Things which harm other people also harm us, although that harm may be indirect.  It may be in the form of higher taxes or higher insurance rates.  It may be that someone else’s illness gives us a greater chance to become ill or to spend more time in the emergency room waiting to be treated.  But that harm to other people actually does affect us, each and every one of us.  Just because someone else’s problem doesn’t seem to be directly affecting you, that doesn’t mean your life wouldn’t improve if that problem were solved.

If you have paid careful attention to what these various political groups have been saying about our national problems, economic problems, or just our problems as people you will find money to be heavily involved in some way in all of these problems; The Biblical verse which states that the love of money is the root of all evil has a great deal of truth to it.  It’s not the only root of evil but it’s certainly a major contributor to evil in our world.

Economics is the academic discipline or science which studies money as we know it:  Not so much from the anthropological point of view, but from the modern industrialized world point of view.  Economists don’t study how the Romans of ancient times made the transition from using salt as the commodity money of choice to the use of coins of silver, gold and other metals;  That’s for anthropologists and historians rather than economists.  But economics has been around for hundreds of years as many of you know, and I’m sure some of you have even read your Adam Smith.  Our scholars, politicians, and philosophers have been thinking about these issues and trying to solve problems involving money for thousands of years.  Economics has had the benefit of all that thought and all the data gathered by anthropologists, historians, and ethnographers.  Yet with all that thought and all that study and all the data collected by economists and others we still have the same problems that the ancient Egyptians had over 5000 years ago.  Where are the solutions to all these problems involving money?  Why do we still suffer from poverty, political oppression, unemployment, organized crime, war, inflation, debt, externalized costs and so on?  If you ask an economist, anthropologist, psychologist, sociologist or even your neighbor, you won’t get a satisfactory answer.  They might say something like “that’s just human nature”, “people are sinful”, “there isn’t enough to go around”, ”governments cause all our problems” or “it’s because your mother didn’t treat you right.”  But no answers of that kind really explain why we haven’t eliminated those problems even after using money for over 5000 years.  If economists understand the cause why do we still have the problems?  If economics is really a science, where’s the corresponding technology which can apply the findings and theories of economic science to eliminate these problems?  “If you’re so smart why aren’t you rich?” as the old saying goes.  Economic theories may come and go, coming into popularity and fashion and passing back out of fashion but none of them ever seems to get refuted – to hear their advocates talk.  None ever really get disproven.  None of their theories are ever tested and completely fail the test.  Have you ever heard of an economist who said, “Given what we have learned, I now know that my theory was completely wrong.”?  Sure we have economic disaster after disaster but for some reason, according to each of the schools of economic thought; those disasters merely prove to their advocates that each of those schools of thought was right.  Look at the explanations for the world-wide Great Depression of the 1930s.  Every school of economic thought will tell you why it happened and will tell you that those tragic events supported their theories and refuted the other guy’s theories.  But I don’t recall any theory that predicted the crash and its magnitude.  Of course I am not an economist, nor have I read everything ever written on the subject: so one or more economists may indeed have made such a prediction and I just missed it.

But the point is that we have been looking at money problems and economics for hundreds or thousands of years (depending on how you define economics) and still have the same kinds of money problems – with no sign that any of those problems are going away.  We still have governments taking money by force from citizens.  We still have children going to bed hungry.  We still have at least one adult in twenty (maybe in ten!) without work even though they want to work.  We still have organized crime, political corruption, inflation alternating with deflation.  We still have no truly free markets.  I came to the conclusion that we have not correctly identified the nature of the problem.  My conclusion is that we need to look at these issues in a new way because all the old ways have not worked at all.  We are doing something wrong and all the orthodox ways of looking at these problems have failed us.  I promise you that the point of view I will present will be “outside the box,” unorthodox, “off the wall,” and not found elsewhere.  I am not ashamed to be unorthodox in my thinking.  I say this proudly:  I proclaim it.  Why?  Because every orthodox approach has already failed many times.  There is no solution in economics – there is no solution inside that box.  Our only chance of finding a solution is to look outside the box, to be unorthodox.  Fortunately the idea I stumbled across (intellectually speaking) explains not only our problems but explains why all the other proposed solutions have failed for thousands of years and why they will continue to fail no matter how many times we try them.

Naturally, outside the box ideas are very likely to be wrong as well.  Just because I am different doesn’t mean I am right.  But as Sherlock Holmes said in “The Sign of the Four” mystery, “How often have I said to you that when you have eliminated the impossible, whatever remains, however unlikely, must be the truth?”  Well we’ve spent thousands of years eliminating solutions which seemed possible but which turned out to be impossible so it’s time to look for new explanations of these problems and the new solutions which they may make obvious.

You should look upon my ideas as something to investigate fully, if what I say has something of the truth in it.  So examine each point I make thoroughly.  Please don’t automatically reject an idea just because you want me to be wrong. Of course if you really don’t want those problems solved, reject now.

So if you’re ready to stretch your mind and have your preconceived notions contradicted – if you’re ready to at least consider something really different, something that never before crossed your mind then pay attention.  Because that’s what I’ve got for you.  On the other hand, if you’ve already decided that I’m a nut case, keep reading so you can laugh at me.  Who knows, I may prove mildly amusing.

Let’s begin on a dark street in the seedy part of town.  You approach a dark alley and as you pass it someone steps out of the shadows, presses a gun into the small of your back and you hear,

“Your money or your life!”

That stern choice has been presented to millions of people over the centuries.  Go back as far as you like in human history to any part of the world that had a government and you’ll find money being taken from people against their will.  Sometimes it was the government demanding tax money.  Sometimes it was a robber holding a victim at knife (or gun) point.  Sometimes it was soldiers looting and plundering.  Sometimes it was pirates at sea.  Sometimes it’s some kind of fraud whether small like false advertising or large like the trillions in mortgage fraud by the major banks of the world in 2007-8.  But in all times and all nations you will find this pattern of money being taken against the will of the owner again and again.

You already knew about these ways of taking money by force.  But were you aware that these things happened in every nation without exception in all of history?  It doesn’t matter what form of government the nation uses. Even during the Dark Ages after Rome fell when there was almost no government as we know it today, money was still being taken by force, stealth, and fraud.  It doesn’t matter what religion the people followed.  The Pharaohs of Egypt, for example, had been taxing for over a thousand years before Moses was born.  It doesn’t matter what kind of technology people use.  It doesn’t matter what the laws and morality of a nation say.  In every nation everyone has had to worry about someone else taking their money.  And in every nation taking money from its owner against the will of that owner is considered immoral. (Unless a government or religion does it…)  I think we can all agree that what I have said here is true, that money can be taken from you against your will.

Why is this violation of law and morals universal?

While you’re pondering that poser, I’ll mention that in every nation people also lose money from time to time.  Have you ever found a coin or a bill on the ground or in the street or using one of those metal detectors on the beach?  Well somebody lost that money you found.  That’s another way the amount of money you possess can be reduced against your will.  I’ll bet I don’t need to explain why that can happen in every nation.

Did you ever see someone in a cartoon light a cigar using a large denomination bill?  The idea is that such a person is so rich that the amount of money lost thereby is trivial to them.  But paper currency can burn and coins can melt in a fire.  Currency can be destroyed accidentally or on purpose.  So hiding money under your mattress does not necessarily keep that money safe.  This also has been true in every nation throughout history.  Have you spotted the common characteristic yet, the thread that runs through these several examples?

I’ll bet you have.  The answer is that in every case the thing being taken or lost or destroyed was a physical object, something you could touch and with modern currency even pick up.  Physical objects have always been something which other people could take from you.  When you were a baby perhaps people took candy from you.  When you were in school perhaps a bully took your lunch money.  When you study martial arts you learn how to take a knife away from an attacker.  It is a property of physical objects that they can be taken from you against your will.  It is a property of physical objects that they can be lost or destroyed.  That’s true everywhere and at every time.

I think you will agree that because money is either a physical object or is treated as if it were a physical object; it can be taken from you against your will even when the money is just numbers in a computer somewhere.  (Your bank takes money from you in fees every month, or at least lately they do!)

So because people love money (if they didn’t love money it wouldn’t be used as money) everyone that loves what money can buy has a motive to get as much money as possible, however they can.  One of the ways people can get money is by taking it from other people – even if it’s against the will of the owner.  No matter how you get money from someone else it spends the same.  Now most people are honest, at least most of the time, so you don’t steal or defraud the people you deal with.  But the fact remains that there are people out there in the world who are not as honest as you are, people who do steal money, swindle people, or use force to take other people’s money.

Because money can be taken from you against your will, doesn’t that give everyone else in the world a motive to take your money?  Think about it.  Has your teenager ever taken money out of your purse or off the dresser without your permission?  Yes, even people you love have a motive to take your money.

If you’re lucky none of them will ever take your money against your wishes.  But if you aren’t that lucky, it will happen and may happen more than once.  And that’s just the people you love.  What about all those strangers out there in the world?  Some of those strangers are even willing to kill to get money.  Don’t they want your money, too?  Yes, I agree that most people will resist the temptation to take money against the owner’s will.  But the temptation is always there and people have off days.

You have to be careful, don’t you?  You have to look out for pick pockets and purse snatchers.  You may have a gun to protect your home and family.  You may hire a lawyer when you buy a house.  You have to read the fine print.  You have to be careful about trusting that email that popped up in your inbox.  “A fool and his money are soon parted.”  But there are some really smart people out there who are trying to get your money.  Even people who are not foolish at all can still be fooled.  “You can fool some of the people all of the time and all of the people some of the time” …and that’s enough to make you rich.  To make things worse, if you have a bank account, the bank can take your money and there’s little or nothing you can do about it.  They charge fees for all sorts of things.  And they also have expensive lawyers writing those contracts you sign when you open those accounts.  You don’t have to be a fool to be soon parted from your money.  And there’s nothing at all fair about how powerful interests go about getting your money either.

If you’re rich you’ll probably have to hire people to help guard your money.  But can you really trust them?  After all, they want and need money, too.  And you’ve let them inside the defenses you have set up for your fortune.  And what about all those great unwashed masses of poor people out there?  You know some will do just about anything for money including attacking you and your family.  It’s no wonder you prefer to live in a gated community.

So just because money is or represents physical objects, and we treat even money in computer accounts as if it were physical objects, just because of that we have to suspect almost everyone else of trying to cheat us or of being a threat to our well-being, even to the  point of suspecting people whom we love.

That’s a pretty sad state of affairs.  You get taxed by the state, you get robbed, you get swindled, you get cheated by the businesses you patronize, you lose your coins, and, well, it’s just one thing after another.  And all these problems exist because money is or represents a physical object.  These problems exist because that’s the nature of the money we use.  I can’t emphasize that too strongly.  These problems exist because of the nature of the money we use.

That’s not the only consequence of our using a POM, a physical object money.  Not by a long shot.  Think about it.  If it’s a property of physical objects generally, it’s a property of money, too.  For example, a rock or a piece of wood or a gun has no ethics or morality.  It has no mind, no concept of right and wrong.  So it can be used for any purpose whether that purpose is good, bad, or indifferent.  The same thing is true of physical object money.  Those coins and bills in your pocket can be used for any purpose you can think of.  That money in your checking account can be used for good or evil.  That’s true of every physical object ever used as money and will be true of anything which we treat as a physical object even if it’s just a virtual currency in a computer memory.  Most money transactions today don’t involve currency.  But we still treat that account money as if it were a set of physical objects being moved from one account to another.

Some of the most horrible events in history came about because of how money was used.  The guns that slaughter innocent children are bought using money.  The bombs that destroy people and livelihoods are paid for with money.  The Nazi gas chambers were built by people for pay.  Invading armies must be paid using money.  Money doesn’t do evil things by itself but it is both a motivation and a means for many evil actions.  That’s pretty obvious to everyone.

But wait, there’s more!  I’m sure you have heard of hyper-inflation, situations in which a government simply prints lots more money with large numbers on the bills causing prices to rise to astronomical heights.  You also know about the Great Depression when so many banks failed and prices dropped to very low levels while unemployment soared because the money supply was so depleted due to those failed loans and bank failures.  You see, the supply of one physical object is independent of the supply of other physical objects.  Because money has always been a physical object or represented a physical object, we have had increases or decreases in the supply of money with no corresponding increase or decrease in the supply of goods and services for sale.  In other words we have had inflation and deflation caused by changes in the money supply.  Again, these changes in prices and money supply have been happening for thousands of years and in all nations around the globe.  If the money used is a physical object money inflation and deflation will happen.

Still, if you have a dollar in your hand you can at least control that, right?  Or can you?  It can be taken from you against your will.  But let’s say you have children and you don’t want them spending your money to buy candy.  If they have money in their hands, how do you prevent their buying candy?   You can’t do it, can you?  Eventually they will slip away from you and trade that money for candy.  They can also buy illegal drugs.  Your church may want its members to refrain from drinking alcohol.  (Some do, anyway.)  Can your church prevent your buying alcohol?  Can the state government prevent people from buying illegal drugs or alcohol or sex or anything else by passing laws and hiring lots of police?  No.  Black markets exist in every nation that attempts to regulate and restrict trade in any way.  Prostitution is called “the oldest profession.”  So it would appear that vice for money has been going on in every nation since prehistory.  The only logical conclusion is that a POM cannot be controlled.  If you are using a physical object money in your nation, that money will not be controllable by any person or group or organization.  It just can’t be done.  I think you will find yourself in agreement with that as well.

Even If you have lots of money, if you are wealthy, how do you control the large amount of money you have.  You need help with that problem.  Can you really prevent those you hire from doing things with your money that you’d rather they didn’t?  Employee incompetence and just plain accidents by themselves will cause you problems with control even if your employees don’t try to cheat you.  Those big government budgets are really difficult to control even with the power of the state and all those laws about low bidders and so forth.  When the amount of money involved is large the power of the people who go after it is likely to be large, too.  Lawyers make a lot of money helping people who are trying to control their wealth while other lawyers are helping those who are trying to take that money from the wealthy.  You can’t even control your own money.

I’m sure you have seen a movie or TV show in which some guys are playing poker.  Each player has some poker chips in front of him or perhaps actual currency instead.  So let’s imagine that each of five players has $1000 dollars when they sit down to play.  After playing a while, one or more of the players may have more than $1000.  If that is so, then one or more of the others must have less than $1000 since the amount of money at the table is still $5000.  If someone wins in this situation, someone else must lose.  The only way one of the players can win money is by some other player or players losing money.  The sum total of the money won and the money lost is always zero.  The winnings are always exactly matched by the losses.  This is called a zero-sum game situation.  It is obvious that such a situation, a situation in which for one person to gain some other person has to lose, makes the participants each other’s opponents, rivals, competitors, enemies.  It makes each of them act against the best interests of the others.

An economy is not a zero-sum game.  In the days of barter that was obvious.  Each party to the trade of goods gained as a result of the trade.  It was a win-win situation.  The persons trading could become friends and cooperate with one another.  They might even want their children to marry so that the trade could continue to benefit both parties for many years to come.

So we know trade is a good thing.  Trade makes us all richer, or at least trade can make us all richer.  When we bring a physical object money into the trade it changes the very nature of that trade.  Just by that very act we convert cooperation into competition.  The buyer wants to give up as little money as possible in gaining the product.   The seller wants to get as much money as possible in exchange for the product.  Each party to the trade will try to get the best of the other.  In this context, fraud in its various guises comes to the fore.  The buyer, for example, may pretend to not really care as much for the product.  The seller, on the other hand, will try to hide any flaws and laud the best features of the product.  You have all seen lying ads whether they lie subtly or blatantly.  We are so used to lies in ads that we tell ourselves to not believe ads.   Meanwhile, the advertisers attempt to work on our sub-conscious minds in various ways.  And it’s all because a physical object money simulates falsely a zero-sum game situation because we tend to see only the money part.  We notice only the money for some reason.  Look at the balance of trade statistics for nations.  One nation will get more money and give more goods and services and that nation we think of as somehow winning while the nation that gives up more money and gets more goods is seen as losing.  But it’s trade.  Both parties are winning.  POM lies to us.  It tells us that we can gain at the expense of others.  It tells us that everyone else is trying to cheat us.  It tells us that we cannot trust those with whom we do business.  It gives us a powerful motive to work against others.  You may have noted, for example, how huge are the externalized costs passed on to the public by the major corporations.   That’s the zero-sum game simulation at work against everyone.

You may have noticed that every money transaction using POM is a two party transaction.  That is, money goes from one party to another party no matter how many persons are in each party.  So what’s wrong with money transactions being two party transactions?  You see, if one party gains an advantage over the other party that more powerful party can use that advantage to gain a still greater advantage.  It’s like when you played Monopoly.  One player gets ahead and gains a money advantage and can use that advantage to gain a still greater advantage.  That’s why, even though a Monopoly game can take hours, it will almost certainly result in one player getting all the money and all the property and the game ends.  That’s instability.  It happens within economies and between nations.  When a new kind of business starts (say automobiles back in 1900) there are usually quite a few organizations and even individuals who enter that new business.  As time goes by, some of those organizations will gain an advantage in one way or another.  It may be just good luck.  It may be a better version of the product.  It may be fraud.  It may be favorable legislation.  It could be any or all of these things and more.  But those businesses which get ahead now have more money to use to advertise, to improve the product, to lobby with government, to bribe inspectors, to hire lawyers to attack or defend against rivals’ or customers’ lawsuits, to hire spies to check out the competition, and even to sabotage rivals’ operations.  The result is that the economy of every nation which uses physical object money is inherently unstable.  Those who have wealth will gain more and more wealth just as in Monopoly until the structure collapses in one way or another.  You might try looking at some of the tables and charts in that new book “Capital in the Twenty-first Century” by Thomas Piketty.  You can see that capital tends to accumulate in fewer and fewer hands.  That ever increasing concentration of wealth is the underlying instability that is at the root of economic collapse.  When the poor have money the economy booms.  When the poor can’t spend the economy busts.

You can see that no matter what we try to do with the economy of nations and the world, this inherent instability will create the busts that wreck whole nations and, with globalization, can wreck the world economy.

All in all it sort of makes you wonder how humanity ever got as far along as it has.  We really do have to have money.  We could not have gone beyond a hunting and gathering level economy without money.  The great division of labor we employ in the world economy has made us all the richer.  But we have paid a huge and terrible price for our progress in pollution, poverty, war, environmental destruction, resource depletion, and needless death and suffering.  And we are not finished paying either.  All those problems and all that suffering occurs because the money we use is or represents physical objects.  POM is the problem that is at the root of money’s evil.

You’ve read what I had to say about how money being a physical object has caused all sorts of pain and suffering but your subconscious mind still remains to be convinced.  Your subconscious still thinks money is wonderful.  The nature of our money may well kill us all in any one of a number of ways yet you still desire money.

So you still face a choice that humanity shares, “Your money, or your life.”

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