I just finished reading Debt, The First 5000 years by anthropologist David Graeber. The book examines the history of debt and money in relation to societal structures through a lens that departs from conventional economic thinking.
Conventional wisdom portrays a picture where people barter goods and services inefficiently directly with each other and that money is a natural result of the problems associated with this. Graeber eviscerates the narrative by looking at anthropological histories. Primitive societies shared freely their resources with each other. They lived in a communal way of life, and bartering was rare. It only took place when separate communities interacted with each another. It played no part in the intra-communal matters of early societies.
Money, as in commodity currency, was first used in rare interactions between communities across large distances. Local economies did not use such mechanisms of exchange. They used credit. Credit controlled and supervised by the government as in Ancient Sumer. This system evolved from the informal “credits”, which people used to share resources in more primitive cultures. It was formalized by the power structure and temples in Sumer. No money was exchanged during the exchanges. Instead, debts were recorded at the temples and people paid their debts periodically using actual commodities.
The state created and maintained debt at large scale before coinage. Commodity currency was only created later by the state. As large scale trust-based societies collapsed, they gave way to warring states. In a period of constant warfare and roving army, debt and credit make little sense. There is no guarantee that the roving armies will return to settle their debts.
Since the advent and rise of central banks in the modern age, human societies have been oscillating between virtual money and coins depending on the period of time. This is based on whether the era at the time was primarily based on war and conquest. People have followed the same pattern throughout history, creating their own informal localized credit networks when large Empires that used coinage fell. The government then slowly inserted themselves into these networks to mediate and, eventually, coinage returned as violent Empires rose.
Bartar, contrary to what is taught in conventional education, was never a part of the process of developing money. Instead, the state had a direct role in the formation and development of monetary markets and systems.
I’m sure that many people are incredibly triggered by this, but Graeber is presenting a very solid case, based on actual historical and anthropological data, not speculation. I’m particularly interested in the idea that Chartalism is more grounded than many people would like to admit.
Bitcoin is a very profound concept. Bitcoin isn’t just a currency. Back to the beginning After reading Debt I don’t believe that stateless money has ever existed. Bitcoin is First, you can read about the first Never existed stateless money To me, this makes it even more of a historical shift and an incredible accomplishment.
This book is worth reading, regardless of your economic views. You will have a lot to consider in relation to Bitcoin.
This article is about a Take. Opinions are those of the author and not necessarily those of BTC Inc. or Bitcoin Magazine.
