Tuesday, October 25, 2011

Day 17 - Mo' Money, Mo' Problems

Good day all, it's Day 17 here... I want to talk about money, specifically. 

We seem to be having some serious world wide issues with money, whether it is the dollar, the ruple, gems, whatever.  Many countries are falling into a "debt crisis" and are pretty much left holding the short end of the stick.  The need to beg some other country, who is accused by many with leveraging the market to keep their currency stable, to "bail them out".  In any event, this all seems very childish...

I'm going to say something that has been said many times before, but I think it needs to be revisited with a little clarity: Why don't we just get rid of money altogether?  ::gasp::  Before we start the comments/remarks/eye-rolling/page-closing, let's just talk about it first...

What is money, exactly?  We'll go to Wikipedia for this:
Money is any object or record that is generally accepted as payment for goods and services and repayment of debts in a given country or socio-economic context.[1][2][3] The main functions of money are distinguished as: a medium of exchange; a unit of account; a store of value; and, occasionally in the past, a standard of deferred payment.[4][5] Any kind of object or secure verifiable record that fulfills these functions can serve as money.
Money originated as commodity money, but nearly all contemporary money systems are based on fiat money.[4] Fiat money is without intrinsic use value as a physical commodity, and derives its value by being declared by a government to be legal tender; that is, it must be accepted as a form of payment within the boundaries of the country, for "all debts, public and private".
The money supply of a country consists of currency (banknotes and coins) and bank money (the balance held in checking accounts and savings accounts). Bank money usually forms by far the largest part of the money supply. [6][7][8]
" (Wikipedia.org)

That is directly from Wikipedia.  The most important part, to me and my point, is the second paragraph regarding "fiat money".  Now we visit Wikipedia regarding "fiat money":

"Fiat money or fiat currency is money whose value is not derived from any intrinsic value or guarantee that it can be converted into a valuable commodity (such as gold). Instead, it has value only by government order (fiat). Usually, the government declares the fiat currency (typically notes and coins from a central bank, such as the Federal Reserve System in the U.S.) to be legal tender, making it unlawful to not accept the fiat currency as a means of repayment for all debts, public and private.[23][24]"

In this excerpt, we are looking directly at this line: "Instead, it has value only by government order (fiat). ".  Now, I don't know about anyone else in this virtual room, but that seems a little ridiculous to me.  If I read it correctly, this is saying that US dollars (for example) are only valuable because the government says so.  It appears that the value is backed by taxation, for the most part, which is odd, because essentially you are saying this money is guaranteed because I am getting X% back through taxation...  In any event, we can start to see how it has no value, at all.  It is only necessary, really, for international trading.  If a country were self-sufficient (requiring no outside trade/help) it could probably do very well without money at all.

This brings me to my main point, why not just get rid of it?  I know what you're thinking, mostly: What about workers? Services? Commodities like food? Housing? etc...  My answer: free.  Listen, you want a house?  Either have someone who owns a construction business build it for you, or build it yourself.  Or, go ahead and live in a condo.  No rent, all utilities are on, there is some form of TV and Internet.  Need food?  Go to the store and get what you need.  What about my car? Go get one...

Okay, I can keep going, but there is one obviously gigantic flaw here: Why would anyone work or do anything for that matter if everything was free?  Why would people pick up the trash or cut grass or build houses or own small businesses if they didn't need money? 

Here is my answer to that: because they would have to.  There would need to be one key point in all of this.  The problem with free is that is only works under the condition that there is a producer and a consumer.  We can't have all consumers, otherwise there would be no product to be free.  So, in my opinion, there would need to be a requirement for a free society.  You need to have a job.  That doesn't mean we can all go out and be doctors because there are requirements to be a doctor, educational requirements and experience requirements.  We can't all go open coconut shops because then nobody will be around to do anything else, and in addition, not everyone wants to open a coconut shop.  I like programming, I would continue to write programs for my job, no problem, I love it.  My wife, she likes retail, she might continue to do that while she gets an education in something specific.  Perhaps I will continue to program while I educate myself as well.  The key is, everyone needs to work and some people will need to do basic jobs because they don't have any skills, but maybe they'll seek education and do that while their working. 

There is a way to make it work, and honestly it is probably less complex than our current global financial systems.  Yes, this means that everyone would be equal.  No, it does not mean everyone will go out and want a mansion (who's going to clean and maintain it when their not getting paid for it...).  I would really love some feedback, I love comments and discussions and sadly I don't get as much as I would like.  So please, feel free to comment, I open it up to Anonymous comments for that reason, even if you want to just flame the hell out of me. 


  1. I get your point to get rid of the money, but in all honesty no matter how you look at it, some form of "currency" will always be. Whether it is by trading one good or service for another, or just simply bartering, currency will always be around.

    IMO, most of the money issues come from that we (the US) tax incoming and outgoing shipments to other countries (and even between states). Instead, we should use the free trade system, where we trade one service/good for another countries service/good.

    For example, we produce tons of corn which is used in everyday foods, and we need petroleum. Why not setup a free trade where so much corn will equal a barrel of oil? Obviously, this is presuming that the countries producing the oil want our corn.

    Furthermore, the government is way too involved with private business owners and people in general. This takes a lot of resources, time, and money that the government could be using to say keep our roads, bridges, and other critical infrastructure up to par.

    Another issue, is that the American dollar is no longer rare; therefore, it has lost its value. If we print less of the American dollar than it becomes more rare and holds more value.

    All in all, getting rid of money will never work as you imagine it. Nothing will ever be *free* and some form of currency will always prevail.

    Just my two cents.

  2. @Anon 10/26/11 11:19:

    Thanks for your comment. The free trade system could certainly be a viable alternative to international currency usage. Even if, the country that supplied petroleum doesn't need our corn, maybe we could trade our corn to a different country that needs it, that can trade to the petrol country for something they need.

    I do agree that my concept of no money is far fetched and hard to swallow. However, I do feel that it truly isn't necessary. We already just print up more when we need it, it already doesn't hold any value, rendering it unnecessary except as a tool to control people and put them into specific classes and groups.

    It will probably never be the case that currency is abolished for those reasons, however, the concept is physically plausible and could be enacted in ideal situations.

    Again, I appreciate your comment, thanks.

  3. You like to post yourself as somebody smart and insightful, but in fact, you are an idiot. This article makes absolutely no sense. The only success you have is having me waste two minutes of my time today.

  4. @Anonymous 11/16/11 1258:

    You fail to make a compelling case on these two points:

    1) "...you are an idiot."
    2) "This article makes absolutely no sense."

    Perhaps it is not me who has wasted 2 minutes of your time today, rather, yourself. You could have applied a small amount of effort in explaining your perspective, but instead dropped to primal instincts of ignorance by name calling. I would suggest that if you plan on reading someone else's perspective that you plan to explain your position if you disagree.

    Thank you for your 2 minutes, I appreciate it.