Money is an excellent tool. The money-flow in an economy is directly related to what we do – to the transformative powers of what we do. To put it Richard Douthwaite’s way, money and energy are directly related. Of course in recent times the greater part of money-flow has been related to the energetic flows of coal, oil and gas. However, the money-flow in today’s anti-capitalist and anti-economic casino is related to nothing but the fanciful beliefs of its punters. Casinos can grow as fancies grow by debt-created capital and need no grounding in physics – until either physical resource capital, or labour/energy capital are unable to stretch to that spending power – Then punters lose faith and their casinos collapse – followed by banks – followed by real economies. In all cases, the only way which real economies can supply the fanciful demand of casinos is by mining the future.
By studying the physics of the terrain it settled, the great resettlement also studied the worth of its capital values – a worth which could be measured both morally and by physical weights and measures. The words, worth and value both have deeply-resonant meanings. The casino knocked over a related pack of cards as it fell. Collapsing property casinos brought economic thinkers down to the earth of capital values – and the meanings of worth and value began to resonate! For instance the value of some commons was seen as beyond measurement and so beyond saleable property – and certainly beyond the post-modern notion of “ecosystem services” delivered by “true cost accounting”.
The casino’s collapse had been exacerbated by decades of “quantitative-easing” – in which money was printed from nothingness to create further spending – a spending without regard to the needs of the times. In consequence the distance between casino money-flow and the real economy of valued capital increased – so that the coming crash had further to fall. Had money been spent into specific new deals, which answered the needs of the times and created real economic activity – such as employment in green technologies – then the real economy could have expanded as the casino shrank – so softening (or truly “easing”) the fall.
In case I fall into the trap of blaming central banks for all the going-on of the casino, we should remember that ninety five percent of money is created by private banks, which simply spend it into existence. I blame central banks for endorsing such a culture and for swelling it – even by five percent and for reneging on responsibility to the true and real economy.
Anyway, new deal spending was not the case – but the consequent case was that lessons were learned. The greatest lesson was that the powerful were powerful by exploiting the existing system, not by knowledge of the changing times. History shows that those without ethics have easy pickings. My picture is of a pond. Those with a weight of morals and self-doubt remain in the pond mud, while those without a care float like bubbles to the surface scum – Post-modern political leaders have perfectly fitted their scum – Blair, Cameron, their chancellors and shallow-water entourages, skit on the surface meniscus pulled by the strings of newspaper barons, who in turn, are pulled on corporate strings. Those who answer the pull of the strings can become (as if by magic) fabulously rich. Meanwhile, the world turns invisibly to them all.
So, the necessity to audit what capital remained after the pillage of New Labour/Tory decades, stimulated a desire for knowledge of how capital behaved – what could be owned and what should be common? – What were the physical and biological natures of that capital and how could it be both employed and protected?
Historically, money-flow (for paper money) had been restrained to the level of capital (of physical resources) by a representative standard – or otherwise (pre-paper money) simply by the weight of coinage in circulation. The gold standard was abandoned in the UK in Nineteen Thirty One, but the post-war Bretton Woods Agreement re-instated a world gold standard based on the US dollar. Bretton Woods ended in Nineteen Seventy One. Gold standards had limited the amount of printed money to the value of the gold held in the Banks of England, or America. I promise to pay the bearer of this five pound note the sum of five pounds in gold, – so said the Bank of England.
Well, what we are paid for is labour – that which transforms a resource into a new usefulness. So – we can spend at the value of our contributory powers. Our labour adds value, or if you like, transforms ecology into temporary economy and gives us social worth. A standard can be a useful restraint to unpredictable perversities and to the competitive bidding inherent in our natures. However, as we’ve witnessed with local currencies, which are retained within a community, money can also work beneficially without a standard.
We can think of the standard by which the modern casino is regulated as the whole casino – that is the whole world commodity market, comprised of the value of all its punts – not of capital values, but of numbers. Punters in the casino use numbers.
So I suppose we can think of local currencies as balanced by the standard of the desires of that community to exchange labours to buy and sell what has been, or is to be done.
I was a little distracted by other rather marvellous events, while taking my Notes from Nowhere and paid insufficient attention to the currency systems, which surrounded me. However, here are a few disconnected facts. Firstly, many towns, and also regions, used a local currency alongside the Euro. Shares and bonds were most commonly issued in local currencies, but by no means all. The Euro proved useful for many cross-cultural, but mutually beneficial trading ventures.
Secondly, because England had become independent by default and for many of her population, reluctantly so – she held on to the pound, while Ireland (of course), Scotland and Wales adopted the Euro as the standard currency for trade. The English pound proved useful as events turned out, because it focused economic thinking on English values (of terrain, resources and labour). My listeners will have heard a variety of tales relating the events which followed the English adoption of the American dollar – I’ll let those quietly resonate, because (no doubt) passions will still rise. It will be sufficient to notice that the special relationship in subterfuge and military interventions was insufficient to maintain an economic relationship of any importance – particularly because it became all too apparent that for Wales, Scotland and Ireland the India and China trades had proved so advantageous.
Close to home for this narrator, the flowering of the Welsh seaboard, coupled with the revival of legendary Welsh boat-building skills ferried prosperity and adventure and cross-fertilised a dynamism to and from the Indian Ocean and beyond. Mutual comparative advantages bore out Grigor Mendel’s thoughts on the vivacity of such a cross-fertilisation. The ancient civilizations of India and China, in re-finding their own cultural diversities, were thirsty for the knowledge of still more. With regards to the cultural identities of small nations, there is and always has been a romantic vivacity to the thought of smallness in a great and exiting world. We sail back and forth from the cradle of an intimate, small and tender cynefin.