Friday, March 31, 2006
A blue-sky thought (warning: requires socio-political criticism)
It was stupidly early in the morning, and I was on my way to Phil's
Bankruptcy Party. And I was in a filthy mood. Why I should get
out of bed at this godforsaken time, just so that the Asian half of
Phil's network could join us in a celebration that (judging
from their replies) they still didn't completely understand... well.
Idiotic. I smacked my lips together, blearily. Yuk. No prospect of
being allowed to stay on orange juice at this do, unfortunately, but
the last thing I needed was more alcohol. I swayed wearily, and let the
clatter of the tube train shake its way through my bones.
There's a definite clientele on the tube trains at five-thirty in the
morning. A few shattered clubbers, their faces leaving glitter imprints
on the windows; but mostly small men in leather jackets or industrial
high-vis tops, their chins ducked inside their collars, trying to get
to work before the world wakes up and notices them. I couldn't care
less, frankly. I hunched down and gloomily contemplated the ordeal
ahead of me.
I've been to five Bankruptcy Parties in the last month alone, and every
single time I go the bankruptee is a little more smug than the last
one. Phil would be intolerable - and I knew from bitter experience that
Phil's 'intolerable' left everyone else's far, far behind. He's a
relentless queen, a relentless, intolerable, screeching fucking pain in
the... Well. I disapprove, that's all. I'm a solvent, young, straight,
single guy, and I seriously disapprove. Call me old fashioned, but if
you can't handle money then you shouldn't be allowed any. I have had
this argument with Phil before - I think it was at his second or third
Bankruptcy Party.
"Paul, how can you be so square?" I remember him asking, wrinkling his
nose in distress and making cow eyes at me. "It's the death of the
system, that's all. How can the economy keep going if I'm not allowed
to spend money?"
"How can it operate when you don't pay your bills?" I shot back.
He looked shocked. "I do pay! I pay until I can't pay any more."
"And then some poor schmuck's business goes under."
"If I didn't pay, if I " his nose wrinkled in distaste,
"saved, then even more businesses would go under!
That's what the government says, isn't it?"
I had to concede this. That's what they were saying. They were making
it easier to declare personal bankruptcy, too. And at the same time,
they were wringing their clammy hands about the vast amount of personal
debt we were all carrying around, and trying to clamp down on the
non-money netsuke networks, where the whole thing operated on favours
and no money changed hands at all, so nobody paid tax.
I resented this. "Look, someday your debts are going to be called in, and you'll be in serious trouble."
"No I won't. I'll be bankrupt." he giggled. "Again!"
"Someday," I said darkly, "that won't be an excuse."
Phil pouted again. "You're wrong, my hirsute friend." (I had a
moustache then.) "Nations have been doing it for decades. The personal
debt market is just catching up! And goods are all made in robot
factories, so they cost next to nothing! The rest of it is money
chasing money in a panicky spiral. Well, I just stepped off the spiral
for a bit, that's all. I can get back on. Not like you, my economic
neanderthal. 'someday they'll be called in'... listen to yourself!
Someday there won't be any money at all, and I'll bet you my entire net
worth that that day will come before the day they decide to call in the
debts."
I leaned back, smiled. "And what is your entire net worth, worth?"
Phil threw back his head and squealed with drunken laughter.
Regular bankruptcy as a stepping-stone to a non-monetary economy? Any thoughts, anyone?
Subscribe to:
Post Comments (Atom)
11 comments:
Well consider him fairly warned. He'll have to learn the hard way. And he will.
Oh dear. Have you considered using a portion of your liquidity to pay someone to smack Phil in the smug chops?
Sounds like Phil is planning on doing a James Dean.
Nothing sadder than an old, wrinkly queen.
I kind of left this hanging without really explaining, didn't I?
So: barter networks aren't new, and there exist a few high-tech, internet-mediated ones. There's a great story by Bruce Sterling about a modern barter network mediated by a central server, which bites back at the tax officials trying to shut it down. And nobody used money in Star Trek. So the idea that we won't use money in the (far) future isn't new. And there's been a lot of stuff in the news here recently about how (in the UK) everybody has a very large amount of personal debt. And debt is such a strange thing, isn't it? I mean, national debts never get repaid, and if a company goes bust then the investors never see their money - and if you go far enough into debt then your creditors can't even call in the debt - the Channel Tunnel (they built a tunnel between England and France) has so much debt that the banks can't call it in because the banks would go under if they defaulted... So I was wondering, how would the change from a money society to a non-money society take place? It probably wouldn't happen overnight. And it probably wouldn't be smooth. I wondered whether a system whereby bankruptcy was a regular and commonplace occurrence might be an intermediate step on the way to not using money at all.
One problem with this model, is that as the monetary model moves further and further into the red, more and more is offered on credit, and less and less is available (or affordable) as cash - if you declare yourself bankrupt, your possessions are repossessed (not that they actually belonged to you in the first place) and the debt written off.
However you will thereafter find the things available to you on trust dwindling considerably (mortgage, credit cards, bank accounts etc) leaving you with no choice but to rent, pay cash, and shop locally (because you'll probably find it difficult to purchase things on-line)
Good credit buys you a smoother ride through your economic life.
That's true; but you're assuming a money-only system. The idea of a separate, non-money system isn't new. If such a system existed, and was a bit more sohpisticated, you could maybe exist on that system for long enough that your credit was wiped clean?
I'm basically assuming that the entire economy is a mess and is relying on credit to operate. So the stigma of bankruptcy and bad credit is severely reduced, simply because the money's needed to keep the economy running.
The basic problem is why an economy would be so dependent on debt, and how that would work without leading to either massive deflation or inflation. I dunno.
A money-less system? I'm not sure it can exist - at least not while capitalist, pyrimidal rob-Peter-to-pay-Paul brand of consumerism we are fostering in the west exists.
I suppose our economy has shifted towards debt - simply because it looks better on the balance sheet that way (in a scarily Enronesque kind of way) I suppose the driver is the rate of production, how far forward the point of acquisition is (i.e. do you have to save, be nice to the people you're buying from, and then pay in cash, in advance - or do you take the item, buy now, pay nothing till next century) is something that must be driven by balance sheets - and I guess, balance-sheet pressure is going to push the 'point of acquisition' ever further into the future, or at least as far as it can go before other pressures become more dominant. The balance is maintained, I suppose, on the balance sheet anyway, by the 'bad debt provision' and 'Insurance Expenses' - as long as you keep an eye on these figures, everything *should* keep itself ticking along nicely.
At some point, the capitalist model has to fall apart - the same way any pyramid scheme falls apart. The only way to postpone that is to have regular catastrophic destructive events (read wars) or to somehow shift onto a new model. But how? What model provides a cohesive social framework, while still keeping people engaged and interested in expending their energies in gainful employment. We've already seen (I hope) the death of Nationalism, Communism - and I guess, it's only a matter of time before Consumerism goes the same way - but what comes next?
That's an interesting question. It's like Winston Churchill said about democracy - it's the worst possible system except for all the others! I see capitalism as dependent on growth - when the system can no longer grow, then we're in trouble. Catastrophes help this, by creating space. This is one reason why I feel passionately about the space program - because in the long term we need it to continue growing.But that's by the by.
A money-less system.. well, service networks aren't new, although most of them work on labour units - you swap an hour of your time for an hour of someone else's - which is kind of like currency anyway. There was one where I used to live in Bristol. And gift economies aren't new - in many parts of the world the exchanging of gifts is a very important part of life - notice that this is an exchange rather than a selfless act. So all we have to do is assume that at some point material goods will be so cheap to manufacture that it almost won't be worth charging for them, and that technology will allow us to quanitfy our goodwill and make gift economies more far-reaching and complicated, and we're nearly there.
The story that really inpired me to think about this is Bruce Sterling's Maneki neko.
Credit-based societies are neither new nor doomed. A standardised currency unit will be around in one form or another for a long time to come. Assuming that manufactured goods are the basis of our economies is your first mistake.
Most value is now generated by the gathering and dissemination of information. Growth of that trend will continue, in my view.
I don't think anybody living in the UK, with its vanishing manufacturing base, could assume that the economy is based on manufactured goods! But I'm forced to agree. I don't see how a successful system could work without some standard unit of exchange. Having said that, I do find the image of people giving up on the standard system of money - with its taxation, speculation, and inevitable links to corruption and its disregard for the environment - I find that a very compelling image. Maybe it's just the anarchist in me ;)
I'm not sure that we'll ever revert to a barter-based economy. It happens at a micro level, but it's difficult to maintain at a macro level. I do suspect there will be a fundamental change in the international arbitrage industry. There is little in the way of intrinsic value to support it. "Cloud Cuckoo Land" on steroids.
I think the change will come if and when China overtakes the US and we see the economic fallout of the lack of stability that will precipitate.
Post a Comment