Anarchist anthropologist David Graeber's Debt, the first 5,000 years is a brilliant, passionate, opinionated, thought-provoking work looking at the history and cultural meaning of debt since human records began. It has been a long time since I've read a book which stimulated so many brand new thoughts as I read it. It also has a number of flaws, some of which I'll address in separate postings, but for now, I'll concentrate on some of the more startling ideas.
Adam Smith in the Wealth of Nations invented a myth around the invention of money by postulating a historically inaccurate myth of primitive barter culture which bears no resemblance to human cultural history
This is part of a neoliberal thesis which tries to construct a history of the Market which is materially independent from the State. This separate history is a fabrication
Credit systems pre-date cash by a long time and there have been major cycles in human history where one predominates
1971 marked a possible return to a largely credit-based rather than money based world economy
Money is and has always been a politically negotiated balancing act between the commodity interpretation and the promise interpretation
For the majority of human history, power has overwhelmingly resided with the lender, to such an extent that borrowers would suffer grievously when they fell behind in their repayment schedule
In many cultures, across much of human history, lenders have cynically constructed loans which have been designed to fail, resulting in punitive and inhuman retribution on the borrower or his family
Many of money's original uses are bound up with slavery transactions, bride payments, honour payments
Money became increasingly linked with transactions which rip humans from their social context. By making them fungible and susceptible to mathematical analysis required much sustained violence. The pre-eminent example is the European involvement in the African slave trade
Slavery has been abolished many times in human history - its re-emergence coincides with the so-called bullion phases of world economic development and becomes diminished during humanity's credit phases of economic organisation Bullion cycles are associated with expansionary war efforts, the development of anonymous coinage systems, and markets develop to serve occupying armies
Bullion can be stolen by invading armies, and can be used to pay soilders who represent poor credit risks
Credit records can't likewise be stolen, but they can be smashed in revolutions, and many of the world's revolutions have been associated with destroying unbearable debt records
Modern materialist philosophy developed almost contemporaneously with widespread use of coinage in the greek city of Miletus; this heralded the possibility of radical simplifications of human motivations
Islam more than any was the world religion which most embraced the possibility of free markets
Adam Smith's famous example on the essentially human quality of exchange : that no-one ever saw two dogs exchange a bone was found in Islamic authors from the eleventh and thirteenth century. So too was the pin factory example of the benefits of specialisation
The Islamic perspective on the morality of accepting interest on a loan interest has deep Christian roots
I'll only mention one criticism which is worth mentioning now: virtually nowhere does he point out any positive cultural or economic benefits to some of those loans he decries throughout the book. If human economic history were like the history of a corporate balance sheet, the author's book is a history of the liabilities only, and not the assets. Compare this to Kaletsky's Capitalism 4.0, which is largely an economic history of the asset side of the balance sheet. Each book separately is incomplete in its focus.
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