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Will Rant For Debt

David Graeber attacks economists for their views on the origins of money — in particular, Adam Smith’s ideas that the market is an outcome of the natural human pursuit of self-interest that needs no government interference.

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In Debt: The First 5,000 Years, David Graeber, a professor of anthropology, takes the reader on a journey through various ancient and medieval civilisations across the globe, describing the use of ‘virtual’ or ‘physical’ money through these eras and providing excellent insight into exactly how people transacted in earlier times. His book does a much better job than most others on economic history in helping a reader understand exactly how money-less economies of the past actually worked. He also makes a compelling argument on the causes that led to the rise of coinage, and fascinatingly, how wars and the creation of armies created the need for a shift to ‘money’ from credit
economies.

In doing so, Graeber attacks economists for their views on the origins of money — in particular, Adam Smith’s ideas that the market is an outcome of the natural human pursuit of self-interest that needs no government interference. Graeber argues that governments created markets and, by disproving Smith, attempts to debunk the worship of his theory that the ‘invisible hand’ of the market promotes general welfare. (Many economists have responded by suggesting that Graeber hasn’t fully understood their views). However, regardless of whose economic history is more accurate, the book’s subsequent attempts to deduce from its description of the history of debt that modern capitalism is a flawed is wholly unconvincing.

Graeber clearly has an agenda. However, it is unclear what his point is. His book, while interesting as a historical description of the role of debt through various times, seems to be stridently making many arguments at once, although it isn’t obvious — or convincing — what those arguments are. For instance, it describes the violence and slavery that has followed the debt financing of the various expeditions in history. But is Graeber suggesting we ban debt as a result? Or while exalting the ‘human’ economies of the past, which gave way to the ‘money’ economies that he seems so critical of, is he suggesting a return to those primitive, simpler lifestyles? It isn’t clear because we get the rant, but not the conclusion.

Similarly, the book painstakingly compares financial debts to moral obligations, and shows their etymological roots to be similar across various cultures. And while it very interestingly shows how obligations to other members of society, to God, our ancestors, and to society itself can never be fully repaid — and in fact, our mutual indebtedness is what makes society — the reader is left unsure whether Graeber is suggesting that financial debts are similar? And if so, what would a world without the need for repayments of debts look like?

In the final chapters, the book rails against modern capitalism and dismisses it as a model doomed to fail. However, we aren’t told what might follow, or even what a better system might be. Graeber even argues — unconvincingly, again — why he needn’t do so.

As a description of the role of debt in history — and in particularly as a descriptor of how people in ancient societies transacted — the book is quite illuminating. If you can manoeuvre through the incoherence of Mr Graeber’s tirades, that is.
 

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