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2019 | Buch

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The Power of Money

How Ideas about Money Shaped the Modern World

verfasst von: Dr. Robert Pringle

Verlag: Springer International Publishing

Enthalten in: Springer Professional "Wirtschaft+Technik" , Springer Professional "Wirtschaft"

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Über dieses Buch

Innovation in money is just as important as innovation in any other sphere of activity; money is always a “work in progress.” In fact, history shows societies have tried out a wide diversity of monetary arrangements. Ideas about money have played key roles at crucial turning points in world history and during national histories. Recently, a new global money space has been created, a joint venture between the public and private sector.

This book explores the new money society that has grown up to inhabit this new space. The book has several aims: Firstly, the book shows how beliefs about money, as well as attitudes and values towards it, have varied between societies and over time, and specifically how they have changed over the modern era. Secondly, the book shows the powerful effects that changing ideas have had on events, including wars and revolutions, recessions, booms and financial crises. Thirdly, the book recounts the creation of a global money space, dated to the last quarter of the 20th century, and explores its features. Fourthly, the book describes some characteristics of the new money society that inhabits the global money space. Fifthly, the book shows how each society, and indeed successive generations of the same society, has made its own unique arrangements to govern money – i.e. how it comes to terms with the power of money.

The author argues that we need to develop a new arrangement now and suggests that we have much to learn from recent creative work in a number of fields ranging from the sociology of money to contemporary art. This approach sheds new light on a number of controversial issues, including the rise of crony capitalism, growing social divisions, currency wars, and asset price bubbles.

Inhaltsverzeichnis

Frontmatter

1. Introduction

Abstract

The Introduction notes some caveats. The historical section examines ten episodes from 1900 to 2000, chosen to illustrate the book’s key themes and arguments. While presented broadly in chronological order, they are not intended to offer a survey of economic or financial history. The evidence is taken from literature, the arts, politics, philosophy and social sciences as well as economic history and thought. Another caveat is that the definition of ‘money’ is broader than that used by economists. The approach is eclectic, multi-disciplinary and multi-cultural. Each of the chapters is self-contained and can be read separately, but they contain a unifying idea, approached from several angles. These are brought together in the concluding chapters (Part III).

Robert Pringle

Time Past: How Ideas Drove Actions

Frontmatter

2. Europe’s Money and Culture Before 1914

Abstract

The prominent social and economic roles played by money in the modern world and our distinctive modern culture are products of many historical forces. Taking the period since 1900, these include the two world wars, the rise and fall of Communism, the experiments with economic planning and the eventual victory of a ‘Western’ liberal idea of the economy. These were all essential stages.

Robert Pringle

3. The 1920s: Lessons from Weimar

Abstract

World War I delivered a body blow to the world political and monetary order. The twentieth century witnessed various struggles to recover from that dislocation. The 1920s showed there could be no simple reconstruction of the pre-1914 order. In Germany the decade is notorious for its experience of hyperinflation and the dispute over war reparations. Despite a recovery, its economy was not strong enough to withstand the shocks of the Wall Street crash and the Great Depression. However, some thoughtful economists drew important lessons from its experiences and these would have a major impact on the formation of our contemporary world. There were also lessons that could have been drawn from the time but were not.

Robert Pringle

4. The Jazz Age: America in the 1920s

Abstract

Americans showed one way forward—innovation. Money would be a means of realising their ideals. It was an element in ‘the American Dream’. The first group of post-World War I experiments, the American way, would diverge from the old European routes. Instead of coming with rules that had to be obeyed, money, like other materials and techniques used to produce and distribute goods, could be improved. It, too, needed innovation and know-how. This would apply to central banking and the new ideas of ‘monetary policy’ as well as to new means of extending bank credit. This age put in place key building blocks of the consumer society.

Robert Pringle

5. The Money-Haters: Experiments in Socialism

Abstract

The second great class of experiments with money following World War I involved various attempts to do away with it. They were to cause, directly or indirectly, as many deaths as the war itself. But the money-haters too have left a legacy. The ideas that moved them are not dead. They come as part of a philosophy and theory of politics that continues to be drawn on by opponents of capitalism. No government today is committed to realising these ideals and, there cannot be a repeat of the scale of the crimes and murders committed in its name. But individuals and groups still look to such ideals for inspiration. Indeed, they do have merit and some form of such ideas is needed again now. As always, beliefs come first.

Robert Pringle

6. Europe Between the World Wars: A Ferment of Ideas

Abstract

The third cluster of monetary innovations that followed the cataclysmic destruction of the 1914–18 war took place, initially, not in the market but in the study and in the imagination of scholars. Only later did they infiltrate the corridors of power. These theories turned out to be as influential as America’s practical innovations and more enduring than the attempted elimination of money by the USSR. By the outbreak of World War II, a new approach was needed. How would trade, investment and economic relations between states be coordinated? And if money was not to be gold, what could it be? Some answers were beginning to emerge from the new theoretical ideas.

Robert Pringle

7. How Europe’s Culture Kept Money Under Control (1940s and 1950s)

Abstract

Democracies have particular needs, demands and ideas about the kind of world they want to live in and these are reflected in their money. So, this chapter is about the demand side of the relationship between money and society, with special reference to European culture in the 1940s and 1950s. Money’s power was curbed by social attitudes; government policy recognised and reflected that. People believed that money must be controlled at almost any cost—and that it should have a clear social purpose. Economists whose views accorded with this climate of opinion were influential; others, such as free market liberals, were sidelined.

Robert Pringle

8. New Money from the New World

Abstract

A new idea of money would be a central element in America’s plans for the post-war world. Beliefs came first. These would allow the United States to save the world and make money. They worked. Importantly, the new ideas of money came branded with American optimism and democratic spirit, a much-needed antidote to Europe’s gloom and failed experiments with despotism. The profit motive and use of monetary measures of success became more respectable. But this idea of money and the right use of it was still a long way from the twenty-first century’s ideals.

Robert Pringle

9. American Culture and the Dollar After World War II

Abstract

Having immersed myself in the literature, sociology and public debate of the post-war period, the sound that I hear most clearly, from all the noises that reach me, is the busy sound of America’s can-do optimism at work. It was a society with many faults and many virtues. People led lives infused with an ideal of public service, of duty as well as personal ambition. They used money to promote American (which they regarded as universal) ideals; prosperity without avarice. This was the foundation of the dollar’s preponderance as a world currency. Its unique desirability is not the product of the Federal Reserve, or Wall Street, or even of the vast American economy, though these all influence it, but rather of American values. When people anywhere acquire dollars, they hold more than a means of payment or store of value. They share in the American dream.

Robert Pringle

10. The Century’s Hinge (Mid-1960s to Late 1970s)

Abstract

International stability and material progress fostered new appetites for choice and economic freedom. The period was a critical stage in the evolution of our contemporary outlook and way of life. Perceptions of money, even the definition of it, were changing. Soon it would be viewed not merely as a tool but as a means of self-expression, an instrument to prove free will existed. It would, indeed, be endowed with almost magical properties. Governments, instead of lording it over markets, would become supplicants.

Robert Pringle

11. 1980–2000: Creation of a Global Money Space

Abstract

The renaissance of a global money space, a milestone in world history, was unplanned, unforeseen and startling. Everything would appear in a new light and perspective. It would make people feel the flow of events, the future as newly uncertain. At the same time, it would redefine the conditions of survival for all societies and individuals. True, many barriers to the free flow of money remained. Payments were slow and cumbersome by later standards. But the critical building blocks had been put in place.

Robert Pringle

Backmatter

Time Present: Actions Have Consequences

Frontmatter

12. The Global Money Culture: An Outline

Abstract

The global culture that took shape at the end of the twentieth century was distinctively Western—indeed, largely Anglo-American—in origin. This chapter describes its main features. It was linked to and—supporters would add—justified by some notion of its broader purpose, that is, how it contributed to social welfare. However, it only took its present form after the financial crash, which damaged the credibility of the underlying model. The collapse also induced central banks to turn on the money taps. Therefore, as we shall see, while the global money space survived, the global money culture has mutated under the influences of two big forces: a surplus of state-created money and a deficit of legitimacy.

Robert Pringle

13. Money Delusion and the Crash, 2000–2010

Abstract

In 2006, a book was published that mocked religion as an ‘infection’ and as the ‘great unmentionable evil at the centre of our culture’. The book was The God Delusion; the author, Richard Dawkins (Dawkins 2006). The book was an immediate sensation and became a global best-seller. But the biggest problem facing society was not the God Delusion but the Money Delusion. From stressed-out housewives, through the upper-middle-class high earners, to economists, journalists, central bankers, governments, officials, the Money Delusion had us in its grip. We should have known that to pursue aims defined in monetary terms was dangerous, but we blundered along as if blindfolded.

Robert Pringle

14. Money as a Tool of the State

Abstract

Contemporary culture takes its mature but most dangerous form in the years following the financial crash of 2007–09. There is no shared vision of how societies should function or how money and monetary institutions can help to achieve social aims. This is a new situation. The last link to any such theory was shattered in the crisis. Modern money is a weapon in the international tug of war. Monetary manipulation increases inequality, distorts new investment, fuels asset price bubbles, encourages monopolies, and is itself protectionist. Currency wars are endemic.

Robert Pringle

15. The Euro: The Biggest Money Project

Abstract

The euro is surely the most ambitious official experiment with money ever made. It is typical of our age—at least, of the age in which it was born—in showing the limitless confidence political leaders can have in imaginary money. They promised to realise a particular monetary dream and implicitly assumed that it would lead to the construction of the necessary political and institutional framework to make it work. There is no better illustration of the power of money, ‘our money’, indeed, of a specific idea of money to make history.

Robert Pringle

16. Crony and Criminal Capitalism Since 2010

Abstract

The global money culture and the fallout from the global financial crisis help to explain the growth of several disturbing modern phenomena, including crony capitalism. Money is desired increasingly for its political rather than its purchasing power. This trend has been aggravated by the sheer amount of money flooding into the system, courtesy of the central banks, and fears among the wealthy elite of a political backlash. The combination of these factors has delivered a killer punch to classical capitalism.

Robert Pringle

17. Global Money: Insiders and Outsiders

Abstract

Most people find their own way of living with modern money in the global money space; however, some do not. These are the Outsiders; they include sub-groups that I call the Opponents, the Outcasts and the Others. Taken together, they form what I call The Resistance. Insiders usually assume that Resisters will gradually be absorbed into the mainstream, possibly leaving a remnant that can be safely ignored. Such sentiments echo the attitudes of pre-industrial Christian Europe to infidels. Against this, I argue that the Resistance will remain a significant force.

Robert Pringle

Backmatter

Part III

Frontmatter

18. The Jealous State and the Future of Money

Abstract

Virtual money has given rise to a classic asset bubble, but does it hold out realistic hopes that society can reclaim money? It faces numerous obstacles. The modern state is a jealous god. It combats obstacles to the scope of its powers, as seen in its campaigns against cash, gold and cryptocurrencies.

Robert Pringle

19. The New Sociology of Money

Abstract

Recent work by sociologists has added to our understanding of the nature of money, notably in analysing the power relationships between the state, financial interests and the wider society in the production of money; why money is often used (and misused) as an instrument of social progress; and why modern money exercises such a large influence on our society and culture.

Robert Pringle

20. Money and the Decline of Classical Liberalism

Abstract

The liberal intelligentsia facilitated the rise of the money culture by their onslaught on classical liberalism, which had legitimated money as an instrument of ownership. They bear some of the responsibility for present discontents. They have both the responsibility and opportunity to make amends.

Robert Pringle

21. What Can We Learn from Japanese Culture?

Abstract

Society should set the direction of travel: what we want money, as a social institution, to be for. We can learn by studying cultures that have, in the past, enabled people to keep money in a given place; I discuss the example of Japan.

Robert Pringle

22. Contemporary Art: Towards New Ways of ‘Seeing’ Money

Abstract

I explore possibilities of learning new ways of ‘seeing’ money through contemporary art.

Robert Pringle

Backmatter

Concluding Remarks

Frontmatter

23. The Money We Deserve

Abstract

This collection of essays has aimed to open up the debate about a subject matter that is a vital ingredient in all our lives, in our society and in the world. Money is our product; it reflects our values; at the same time, it influences our ways of relating to one another. As a pervasive presence, money can and should be a part of our efforts to improve the human condition. Money is backed by values and beliefs. As these change, new arrangements are needed.

Robert Pringle

Backmatter

Titel: The Power of Money
verfasst von: Dr. Robert Pringle
Verlag: Springer International Publishing
Electronic ISBN: 978-3-030-25894-8
Print ISBN: 978-3-030-25893-1
DOI: https://doi.org/10.1007/978-3-030-25894-8