The recent publication of an excerpt from my newest book in London’s Guardian newspaper set off a huge amount of discussion on social media, blogs and news sites around the world. Not surprisingly, opinion divided. Among economists in particular, those outside the mainstream welcomed it as a breath of fresh air, those closer to the neoclassical orthodoxy repudiated it as a cheap diatribe against their profession.
It isn’t quite that. Oh sure, some economists come in for their share of criticism. Yet my book is really a challenge to all of us to examine the way we think about money and the doctrines associated with it. You see, we in the West like to think of ourselves as modern. Declaring ourselves atheists because we don’t need a god to do what we can do for ourselves, we have abandoned the old religions. Instead, we say, we trust in science.
But this is just one of those reassuring stories we tell ourselves. Take one currently-popular narrative, popularised by the ‘new atheists’ like Richard Dawkins, which maintains that Charles Darwin’s discovery of evolution eliminated god’s role in creation and shattered the Biblical narrative. In its place came a new, enlightened narrative based on facts.
In truth, although fundamentalism emerged in reaction to evolutionary theory to assert the old gospels, most churchmen actually embraced Darwin’s theory. Famously, Darwin himself did not consider it incompatible with the old religion, becoming an atheist only when his beloved daughter died and he lost his faith in a caring god. Even today, research on ‘scientific literacy’ has found that few of us know much if anything about science and the way it works. One British survey discovered that half of this highly secularised country believes that humans and dinosaurs coexisted (apparently we we got our paleontology lessons from Flintstones reruns).
No, what really enabled us to put aside belief in god was that money stepped into the breach left by the decline of the old religions. Money has become our god. I don’t mean that in a new-agey, self-help kind of way. I’m merely speaking about the function it performs in our lives. Our ancestors looked to the heavens for health, wealth, security and justice, we look to money to buy us all that.
Fittingly, therefore, we organise our lives around money. If you’re like the average person in a Western country, you spend about three hours each day thinking about how to get money – how to pay your debts, invest wisely, get a new job or increase your savings. You then pass roughly the same amount of time spending the money, online, in shopping malls, paying bills, sitting on the phone with your bank or cable provider or some other help-line which is probably managing to elicit as many religious oaths out of you as a defrocked priest. Add it all up, and you probably devote nearly half of your waking life to pondering money, and most of the rest to making it. Our ancestors mortified their flesh to gain access to heaven, we’ll take a job we can’t stand or add more hours we don’t need to our workday if it enables us to rise the income-ladder and thereby gain more status.
Money is virtually as old as humanity, but it only assumed this godlike quality in the modern period. What made that possible was capitalism. The development of capitalism, in turn, was inseparable from the rise of empire – the European empires at first, and latterly the US-dominated global order. The improvements in technology and organization that helped facilitate the explosion in living standards of the last three centuries were real, but at the base of our prosperity lay a good deal of oppression, even barbarism, as I document in the book. But rather than acknowledge this as a breach with the Christianity that had shaped the West, we opted for a new moral narrative which attributed our wealth to our superior creed and efficiency. Economics thus grew up alongside the empires, giving us a new code for living.
But here’s the funny thing. Although economics devotes itself to the study of money, as David Orrell indicated in one of his contributions to the discussion around my book excerpt, few economists actually understand money. In most models, it is a numeraire, a representation of underlying value, a mere medium of exchange that exists to lubricate transactions.
However, money is more, so much more than that. And when you really begin to understand it, many economic models begin to break down. For as I write in Twilight of the Money Gods, money is both a personal relation and an act of faith. Economists emerged as the modern priests who would help us improve our access to that spiritual entity, but of late, we’ve begun to suffer a crisis of faith. That makes ours a troubling time – but also an exciting one.