How Money Created Liberty

Flint blades may have been one of the earliest forms of currency.  Photo Credit to Travis S.

I need to start out this article with a simple statement.  Money is neither good nor evil, it simply exists.  As we have stated several times now money is simply “an agreement of common value between members of an economy”.  That said in our society and across the world money has served both noble and evil pursuits.  Today we examine one of the most noble things money has ever done for mankind, the creation of true liberty.

I am not talking about political liberty in this sense.  I am more talking about liberty from the limitations of our environmental constraints as human beings.  To understand this we have to go back to that world of 10,000 years ago we talked about in the last article.  Remember the initial trade was one of dried meat in return for tubers but one party didn’t want the tubers.  So a monetary unit in the form of flint knife blades acted as a unit of exchange.  Even though one band didn’t need the blades they knew they had lasting value and could be traded for other items they needed or wanted.

So one band ended up with a surplus of blades, a profit, a store of value.  The beauty was if this band was a band of hunters they now could focus on hunting and use the blades to trade with other bands for items hunting didn’t provide.  This was still a crude form of money with limited stability.  Find a band with an expert flint napper and they were technically “wealthy” but only to the extent that they could find others that needed blades.  Also they wouldn’t be that keen on taking knives as currency from others.

Again over time trade was refined and units like gold coins and other more standardized items came into existence.  It was during this time that humans first began to know freedom from their place in the ecosystem.  This seems complicated but it is remarkably simple.  In the days before money, there were only small societies, tiny bands like our meat hunters above.  A young person in this group was going to be a hunter and a gather, not much more.  To trade effectively your band had to have a surplus of somethings but you had to provide a little bit of everything for yourselves.

Perhaps the flint napper was actually an artist waiting to happen.  A guy who could make not only blades but statues and other beautiful items.  If you know anyone who is really an artist you know that they love their work and seldom want to do much else.  Perhaps the expert tuber gatherer in another band might notice that certain varieties are sweeter, store longer and grow larger specifically in certain conditions.  This is our first farmer, a man who wants to domesticate wild plants, learn what works, learn to grow bigger stronger plants, etc.

In a world with out money people like our flint napper and expert forager will remain hunter gathers and they will have to be jacks of all trades.  There is no way for a person to truly specialize on one thing because any individual only needs so many blades, sculptures, tubers, bowls, etc.  Yet when we begin to build groups the size of villages and towns and add a common currency to a region everything changes.

At once our best “traders” begin to import and export items between towns, others set up the very first malls and “flea markets”.  Now the expert knife maker can make knives all day long and sell them into the economy and use money to buy all his necessities.  The farmer can focus on growing better grain.  The artist can focus on art, the builder can construct houses and in time society evolves.

Money Can Effectively Act Like a Battery, Storing Reserves of Human Energy.

Today despite many limits on our liberty people can pretty much pursue any profession they wish.  Think about your job, how much “barter value” does it really produce?  This isn’t a question of your personal worth as a human but when you think about it many of us produce no “commodity” for trade.   Yet money lets us convert our talents and labor into currency that we can use to provide for needs and luxury.

Take away money, take away a stable currency and we once again become slaves to our individual needs, just a few steps above advanced primates like chimps and gorillas.   No longer can the writer weave stories, the musician create music or the programmer write code.  Money is in effect nothing but a symbol for energy and in this respect if our energy is spent in a way that others appreciate we can earn a return.  We use money to  store  the surplus almost exactly the way a battery does.  When we need a sandwich or a car or a house we tap those reserves and pay for our needs and wants with our own energy.

Money isn’t all sunshine and rainbows though, next time we will look at one of the many ways money has been used to enslave people.

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