Metaphysical Money

Jamie Diamond's yacht
Jamie Diamond’s yacht

Have you ever thought about money beyond the usual too-much-month-at-the-end-of mine? I mean, it seems to be very important, but what is it?

“It’s dollars: you know, those green papers in your wallet, or coins: those stamped pieces of metal.” Then what is a check? Even more weird-what exactly is direct deposited into your bank account on pay day?

Many critics of the Federal Reserve say the Fed creates money out of thin air and this bothers them, partly because what it creates is not “real.” Yet somehow this unreal Fed money can buy real things like Jamie Diamond’s yacht. Think of it, keystrokes at the Fed fly through the air to Jamie Diamond’s bank and show up as numbers on a balance sheet.

He can then transfer these numbers through the air to a yacht salesman and take possession of a real boat made of real materials from all over the world assembled with thousands of man-hours of real labor. Rather metaphysical, wouldn’t you say?

Or we might say money is what we get in exchange for renting hours of our precious lives out to others. How precious are our lives? Well some are far more precious than others. An hour of Jamie Diamond’s life is apparently worth $20,000, while an hour of a fast food worker’s life is only worth $7.50. If it takes Jamie Diamond three minutes to pee, he has made $1,000 while standing at the urinal. Trickle down indeed.

Gold bugs say only gold and maybe silver are real money. But they are actually just metals that we agree have value. We might agree that cowrie shells or tally sticks have value and it would work just the same. In upstate New York, they use hours of work, valued at the exchange rate of $10/hour, as an alternative currency. These Ithaca Hours are useful as money because locals agree that they have value.

So what gold, dollars and cowrie shells have in common, what makes them money, is that we agree they have value and will accept them in exchange for stuff. If at any time we cease to agree that any of these have value, they become worthless.

Even the most fervent materialist, who may be bothered by the fact that money exists only by consensus, wants his metaphysical paycheck direct deposited on time. I’ve noticed that Libertarians, who reject the significance of consensus on philosophical grounds, (it’s me and me against the world) are particularly bothered by metaphysical money; they insist on gold-or currency backed by gold, you know, real money.

What happens when a foreign nation that has tons of dollars shows up at the vault and says, “I want to exchange these for gold. Now.” What happens if several nations do that simultaneously?

Obviously, the one who issues the world consensus currency has a whole lot of power. They can exchange their metaphysical digits worldwide for real stuff. Any challenge to the consensus currency is an existential threat. Real humans will be sent to kill other real humans in defense of the top currency, which is only on top because everyone agrees it has value.

Consensus is obviously very important. It would be wonderful if we could come to some consensus on the value of a human life; something that makes more sense than a Wall Street CEO getting paid in three minutes what the fast food worker earns in a whole month.

Until that day, remember to be kind to fast food workers and don’t forget to tip your waitress.


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