Money: Root of all evil or time saving device?
There's no such thing as "inherent value". Value only exists as the individual expression of subjective preference. Since value judgments vary by individual, no two individuals will the make same value judgment with regard to any given good or service.
This is extremely fortunate. It means that exchanges can be mutually beneficial. In fact, all other things being equal, consensual exchanges ONLY happen when involved parties expect to benefit. For example, if I trade you my pen for your stapler, the trade happens because I value your stapler more than my pen and because you value my pen more than your stapler.
However, if I want your stapler but you don't want my pen, I have two options:
- Take your stapler without your consent
- Trade my pen or my time for something else that you want more than your stapler.
Let's say you're willing to give up your stapler for a bag of apples. Let's say I know someone with apples, but they won't give the apples up for anything other than oranges. Let's say I know a guy with oranges, but he won't give them up for anything other than salt. Let's say I know a guy with salt, but he won't give it up for anything other than wheat. Luckily, I know someone who will trade wheat for my pen. I can then trade my pen for wheat, wheat for salt, salt for oranges, oranges for apples, and apples for a stapler.
This is a fairly burdensome and time consuming Legend of Zelda-esque trade sequence. A lot of people would find plunder less burdensome than such a trade sequence - extremely if they have an extremely high time preference for acquiring the stapler.
Wouldn't it be great if there was a common medium of exchange that isn't consumed in the process of exchange and which is accepted by all market actors regardless of whether or not they have a direct, practical use for it? You know... Something like gold or silver? Then I could trade my pen for some gold or silver. I could trade the gold or silver to you for your stapler, and you could then trade the gold or silver for the apples you want. Boy oh boy! Look how much time we saved! And now I don't even have a reason to steal your stapler because consensual exchange is suddenly less burdensome than plunder!This is the function of real money: to save time and make exchange less burdensome. Gold and silver are great too because they can't be counterfeited. When money is counterfeited, the goods and services "purchased" with the counterfeited money are technically stolen. That's where currency comes in. Currency exists because money is heavy and hard to transport. Currency works like a warehouse receipt that can be redeemed for money. When these warehouse receipts are counterfeited and redeemed for money, this is theft. Likewise, the paper notes in your pocket are fiat currency that can't be redeemed for anything. The fact that they are counterfeited into existence and circulated at gunpoint as a loan at interest means that everything "purchased" by the people calling themselves "government" is actually STOLEN.
The failure to make this differentiation between money, currency and fiat currency is why leftists call for the abolition of money, which could only be accomplished through theft, and which would only make consensual exchange more burdensome than plunder, thereby causing even more theft.
Want to free the people? Free the markets. Call for complete separation of economy and state.


Money/Currency is far more than a time saving device. It does save a tremendous amount of time. I understood the need for currency when I started looking at things in the world and trying to plan how they would become accomplished without currency. It's simple nature of being a universal form of exchange makes some rather complex events trivial to deal with.
Example: I've often considered a cell phone. If I am making a cell phone it has all of the components which I must source from somewhere, and those sources must source the components somewhere all the way down to where the minerals and such are pulled out of the ground and up thru that entire chain. That is complex and immense even with just a single cell phone. Yet this happens with EVERY product we have and with EVERY new product that comes into existence.
Without currency it would be left up to some central planner that must keep track of resources and decide how much is needed, and where it should go. If a disaster happens to part of the chain there is immense planning on how to solve the problem of some resource in that chain no longer being available, and shifting everything else around requires immense planning. It is beyond the capabilities of a human, and it is beyond the capabilities of our current computers if your goal is any sort of quick and realistic response time.
If you believe in God and his omniscience then perhaps there is a being that could know where everything is at a given time and make the necessary adjustments. Sorry humans and computers are not omniscient.
Luckily we have currency as a universal exchange. The individual links in the chain when they fail can go out on their own with this exchange mechanism and find a new source for their link. They do this without requiring all the other links in the chain to be involved.
It is quite beautiful.
Money is not the root of all evil. I am starting to think that might actually fit better with the term Envy. Coveting or Envy seem to be ultimately what most conflicts stem from. Yet people don't consider the problem with ENVY is in themselves and they need to control it. Instead they think the solution is outside of them, it is not their fault, they are not responsible. So they will force change and rules upon others rather than dealing with the problem that started in their mind.
Someone having multi-trillion dollar bank account really doesn't mean shit to me. I can't benefit from it, I don't want someone to steal it from them and give it to me. For that starts a vicious cycle. You steal from them today, how long before you think you should steal from me too. As your stolen wealth acrues how long before someone thinks they can steal from you.
All from looking for a scapegoat rather than owning up to envy.
Wonderfully stated
"If you believe in God and his omniscience then perhaps there is a being that could know where everything is at a given time and make the necessary adjustments. Sorry humans and computers are not omniscient."
That's the thing that socialists and RBE'ers don't seem to realize: it's not possible to centrally plan a way to meet the ever changing preferences of all individuals absent naturally discovered prices. To abolish money is to abolish the means by which consumer demand is expressed in terms of finite supply, which leads to short term eating of the seed crop and long term shortages. Cue starvation. I wonder what will happen to the entire economy as a result of socialist price fixing in money markets... To price fix a single industry is one thing. To price fix the cost of borrowing money across all industries... cascade incoming.
What I find amusing is you can see this effect on the US economy over the last sixty years with the accelerating trend of booms and busts. The greater the level of market intervention by the central bank and government via regulation, the faster these booms and corresponding busts have happened.
But never mind that. We need lower interest rates, and if we hit 0%, we need to institute negative interest rates. You know, for financial stability. Or something.
The funny thing is this same debate already happened many decades ago and they couldn't defend against this fact.
You know what they say about those that don't know history...
They are doomed to repeat it. :)
Thanks for the reply.
Jared, what does "RBE'ers" stand for?
I love the article and commentary!
RBE = Resource Based Economy. An RBE'er is someone who wants one. It's basically socialism with computers.
I agree. Money is not the root of all evil. Lack of money is the root of all evil :) Thanks for your contribution.
I'll have nickname you Necromancer. :) A reply to a post from days ago. It's alive!!!! Haha
It is actually refreshing to know people are looking at the older posts too. Thanks.
I'm failing to see how the supply chain for any good/service would be different or how it would be less fool proof should money not be involved. It seems to me that if the current available options for any given area in need during a break in the chain is superior to the centralized planning you mention; we would keep those lines in tact should a RBE be implemented.
I can certainly agree that the currency system is far superior to trade. In the same way though, an RBE is far superior to the currency system. Money, like trade, imposes many limitations on what is possible for us to accomplish in a given period of time. Of course, an RBE would also require a completely different mindset from the consumer. In fact, I doubt the word consumer would be used at all. I'm not claiming to be an expert on economics or RBE. I'm simply curious to hear more. It seems that you're quite happy with currency and that you may also believe it is the end all be all of resource management and distribution. I would like to understand.
Your assessment of the money meme "Money is the root of all evil" is interesting. Certainly, evil existed far before money. Envy as well. In our current society envy is much more likely to take root in money matters, but I wonder why you decide to include this at all in your statement. What do you have to gain from pointing this out? It's just a meme. If it triggers you that's your problem right?
Overall, it seems like your logic makes a good case FOR an RBE. Strange how that works out in my mind. I feel like I'm missing something.