Money by Felix Martin Page B

first seem, it is from Locke’s revolution in monetary thinking that the awful failings of economic thought that were on display in this shameful episode originated. It was only once money had gone, with Locke’s assistance, through the Looking-Glass, that the traditional ethical dilemmas over monetary society had magically disappeared. Foremost amongst these was the question of the extent to which money should really be the co-ordinating mechanism for social life. This question was rendered obsolete by the new view of money as a thing—a harmless fact of nature. The new discipline of economics boldly claimed to reduce what had once seemed vital questions of moral and political justice to the mechanical application of objective scientific truths. The complicity of this new worldview in ethical disaster was not lost on all contemporary observers. It was Nassau Senior—the Drummond Professor of Political Economy at Oxford and one of the government’s chief advisers on Irish economic policy—whom Benjamin Jowett, the great Master of Balliol College, Oxford, had in mind when he said years later: “I have always felt a certain horror of political economists since I heard one of them say that he feared the famine of 1848 in Ireland would not kill more than a million people, and that would scarcely be enough to do much good.” 17
    Fortunately, the conventional view of money is not the only one. There is, as we saw earlier, another tradition in monetary thought that never stepped through the looking-glass—a tradition that never flinched from interrogating the ethical consequences of the concept of universal economic value and the political and economic realities implied by the choice of the monetary standard. And it is a tradition that started right back when money was first invented, with the Greeks.

16 Taking Money Seriously

    “So!” interrupted my friend the entrepreneur, “I always knew it!”
    “Always knew what?” I answered.
    “That you were a closet revolutionary. You don’t like capitalism or capitalists like me. And what your story about money boils down to is that you want to soak the rich and hang all the bankers from lamp posts.”
    “Where did you get that idea?”
    “Well, allow me to summarise your argument—or maybe I should call it your murder mystery. You said it would be an unauthorised biography. To me it sounded more like an Agatha Christie novel.”
    “Oh yes? Who’s the victim?”
    “Common sense—according to you. But let’s see if I’ve got it straight. You began by explaining that, contrary to first appearances, money is not a thing but a social technology—a set of ideas and practices for organising society. To be precise, you explained that in essence, money comprises three things: a concept of universally applicable economic value; a system of account-keeping whereby that value can be measured and recorded; and the principle of decentralised transfer, whereby that value can be transferred from one person to another. You used that story about Yap to show how absurd it is to think that coins, or any other tokens, are themselves money.And you used that story about the Irish bank closure to show that although money is usually issued by governments, it doesn’t always have to be. I bought all that—but then I asked you what difference it makes to take this view of things. You said a lot—which is why I’ve been sitting here listening to your so-called unauthorised biography.”
    “Sounds fair so far.”
    “Then you began to investigate these ideas that make up money—and especially the most important one: the concept of universal economic value. You explained that a dollar, or a pound, or a euro, or a yen is not a physical thing but a unit of measurement. You explained how some old Polish professor—”
    “Witold Kula.”
    “—that’s the one—had looked into the history of physical units of measurement and discovered that both the concepts they measure and the