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12 September 2013

A Social Theory of Money

A totem is an object that takes an abstraction and makes it concrete. Le Durk wrote about how one tribe of Aboriginal Australians took the abstract idea of "our group" and made in concrete with the depiction of an emu, for example. In the United States, we wrap up the abstract sentiment of "freedom" and the distant memory of the blood of fallen patriots in the American flag. I think that we can see that money is a totem as well. Yes, money is a symbol for value, but that's not what I mean. Instead, money takes the abstract feelings of organic solidarity (from a complex division of labor) and puts them in a concrete, tangible form. Holding coins and paper money, seeing it, smelling it, even hearing it, all remind us in some unconscious way about our integration with the group.

In bartering systems of the past, no shared symbol of cohesion existed like this. A cow was a cow, and magic beans were magic beans. The means of exchange were inherently valuable and, thus, had no capacity for the symbolic. The political economy of these types of societies, however, were much less complex (i.e. had simpler and less fragmented divisions of labor); in other words, the mechanical solidarity that dominated such groups was insufficiently abstract to necessitate a totem. Increasingly today, minted money is being replaced with virtual monies (e.g. credit/debit cards and Bitcoin), which are incapable of serving the same totemic function since they are themselves abstractions. I wonder what the consequences might be of an increasingly abstract political economy that is no longer supported by a concrete symbol.

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