We buy ourselves on credit

The economy is a social enterprise, and money is the blood of trust!

Words & images © Paul Ransom

I read somewhere that there’s an old Jewish proverb to the effect that money is blood. I can’t recall when or precisely where I came across this but either way – urban myth, fake news or otherwise – it’s a metaphor that rings true. Money’s potency is in its circulation. It moves, passing from hand to hand, binding spenders to vendors and debtors to creditors in a complex web of trade. Its core value is entirely rooted in its utility as a universal enabler of exchange (or in its potential for future exchange) and, as such, its function is principally social. Thus, whilst the treasure we stash in our various personal chests serves as a testament to the enduring appeal of so-called private wealth, it’s the moving river of money that flows between us every day that is the transactional lifeblood of our joint social venture and, by extension, of all personal, company and sovereign wealth.

In short, the economy is a group activity and money is its verb.      

Now, before you leap screaming from your favourite cliff of ideological outrage, let me tease this out.

  • I am not saying money and economy are the be all and end all; neither am I suggesting that economic values should automatically trump others in either the private or public realm.
  • I am neither lionising nor condemning the pursuit of financial success, nor the general practise of commerce, per se.
  • However, I am suggesting that the trading of goods and services is a naturally occurring phenomenon. It is a by-product of our evolved sociability and of our related tendencies to both compete and co-operate.
  • Furthermore, our current economic ecosystem has arisen from a combination of the pursuit of individual and group objectives, and from our capacity to moderate these behaviours for longer term self and social interest.
  • I am likewise suggesting that all private economic activity happens in a social space and, as such, all wealth (profit, loss, debt, poverty, etc) is a phenomenon generated and sustained by a complex and evolving network of social exchange; and that its ‘monetisation’ revolves around shared and individual perceptions of value and, ultimately, of the risks associated with each trade.

In addition:

  • I am not claiming for money or the economy any superior or mystical quality; but am instead suggesting that their smooth operation (or lack thereof) is a measure of individual and societal levels of trust.
  • Indeed, the so-called ‘state of the economy’ is a psycho-emotional barometer of broader social and cultural wellbeing.    
  • Thus, I am indeed suggesting the economy we have is the one we bought; and that no one is entirely innocent or blameworthy in either the process or its outcomes.  

Typically, when we speak of ‘the economy’ we conjure it as an externality – something out there, a news event, a socio-political talk point, or even a sinister web of control spun by shadowy puppet masters. We regard it as having almost mechanistic qualities, as if it were something happening to us; an inevitability we are virtually powerless to fight. In short, for most of us, most of the time, the economy acts a disempowering, abstract behemoth; a pervasive but strangely inhuman force with which we must bargain.

Indeed, with its mix of highly predictable and disruptively unpredictable outcomes, the economy is a form of environment, containing measures of threat and sustenance, much as the natural world does. And just as we have conceptually extracted ourselves from what we now call ‘nature’ (as if somehow we’re not part of it), so too we have abstracted the economy into a form of ‘other’. As something outside of us. Not human.

Hence, it is not unusual to hear it being spoken of in morally loaded terms. Its deification by free market fundamentalists and the ‘root of all evil’ memes beloved of bourgeois Buddhists and neo-medieval God botherers underline our widespread tendency to conceive of our shared economic project as a Platonic realm of relentless function. In this frame, the economy is rendered as a form of universal law; a mathematical and existential trend line imposed from an unspecified height above and beyond the understanding of mere mortals.

It acts as a force. We are simply acted upon.  

Little wonder the standard narratives springing from politics – and the endless squabbles over market regulation – either deny or blithely overlook human psycho-social factors. Our habit of abstracting the economy into an ‘invisible hand’ has effectively blinded us to our own fingers.

Yet, perhaps deep in our economic marrow, we do still remember. For money, like language and representational art, is a product of culture.

  • Think of money as a social technology, something that arose to fulfil group demand; namely, to streamline trades between group members and to provide an externally agreed measure of comparative value and account.
  • Or who owes who, how much, and when.

In fact, money is 100% social. Without us to move it around it becomes nothing more than paper or metal, or data stored on a hard drive. It is rendered inert.

Of course, there are those who still cling to the notion that money is a commodity – that a dollar is a slip of paper or the gold that apparently backs it. In my view, this is clearly false. A coin is simply a token – a handily available and easily tangible cipher of universally transferable credit/debt. It is a form of IOU; but rather than being merely bilateral (between you and me) it is passable from stranger to stranger (anyone) without the need for exhaustive provenance. It is a truly liquid phenomenon, flowing easily between individuals, trade for trade.

However, its true underpinning isn’t precious metal, (or even beads or boulders1), but trust – the belief that it will be redeemed, that it will serve to clear our debts and make purchases and that, if stored for later use, it will still be usable.

And right there at the heart of money’s trust proposition, and of the economy more broadly, is the idea of us.  

… in the regular economy, when we drill through all the obscuring layers, the dollar is effectively backed by our trust in one another. Indeed, the economy is a social contract signed with the blood of money.

In the modern context, where the ‘us’ part has become impersonal and abstract, (as opposed to the more personal and concrete clan identities of our pre-agricultural forebears), this means that the ultimate backstop is the vast tribal ‘us’: the sovereign/state and its linchpin role as regulator and guarantor.

Even if we expand our horizons and look to trade globally, (or if we’re tempted by the recently emerged crypto and blockchain space), we still find bounded ecosystems of trust with an inbuilt umpire. So, although crypto advocates frequently prefer the term ‘trustless’ to describe their currency platforms, in effect what they are saying is that their systems of exchange are so transparent that the vaguer trust relationships that underpin the regular economy are rendered obsolete by a more readily visible and neutral external marker; in their case, the machines that log each trade.

To put it another way – in the regular economy, when we drill through all the obscuring layers, the dollar is effectively backed by our trust in one another. Indeed, the economy is a social contract signed with the blood of money. We trust that debts will be honoured in an agreed and timely fashion, that financial arrangements will be either be upheld or that a third party umpire will enforce them, and we act on the belief that every retailer in the land will accept our coins as cash. Meanwhile, in the more contained crypto world, our tokens are backed by our trust in the accuracy and impartiality of digital tracking and of our belief in the design of the ecosystem – which, drilling down, means our trust in the folks who created it and those who participate.

While this may strike some of you as woolly-headed and ridiculous, let’s look at some of the more commonly used terms in finance and economics.

  • Currency – it is both a current and something that is current (or, is happening now)
  • Liquidity – it flows, it is not frozen
  • Credit – from the Latin credo, meaning believe – I believe (trust) you will repay me
  • Consumer confidence – our beliefs about the sustainability of personal finance and our trust in the overall health of the economy as a whole – is now a good time to take the risk of spending?


  • Trust – as in trust fund – in other words, a person or organisation trusted to keep assets secure for nominated beneficiaries

What is clear from this language is that beneath the often lurid spectacle of our economy (and the injustices and ideologies it fuels) are some basic and resoundingly human factors. We are a social species that exchanges items of value; and money is like the blood flowing around the tribal body. If we can trust each other and keep the blood pumping, the body thrives. If not, it gets sick – maybe even dies.

Therefore, stepping back from the clutter of drama and detail, we can pare it back to this:

  • The economy is a dynamic social network of trust relationships, with money as its universally transportable, tribally guaranteed carrier and storer of value. The lender of last resort is, therefore, the universal body corporate. Us.

In saying this, let me stress that the baseline communal reality of economy neither legitimises nor excuses any of the multiple cruelties – social and environmental – that market zealots and neo-liberal sorts seek to paper over with their one dimensional money fixation or their extremist ideology. Their attempts to reduce all politics to economy and to trade off the environment for short term profit represent not only the rationalisation of greed but a kind of suicidal myopia. Likewise, the structural inequalities, corrupt practises, blatant exploitation and other (nigh psychopathic) corporate predation that global capitalism has produced need to be called out.

In fact, when we understand that the economy is social, the selfishness and fundamentalist individualism that drives so many of the worst excesses of the market can be seen more clearly for what they are. These ideologies, and the behaviours they promote and entrench, undermine the essential fabric of the economy and, by extension, of society itself; because they work to erode the core commodity we trade. Our trust in each other.2

Bank runs, credit crunches and GFCs are simply the more spectacular symptoms of mistrust. Collapsing currencies and the ‘junk rating’ of government bonds are the same again; only on a national scale.

Decisions we make about spending and saving, or whether to lend a friend a few bucks, are not only an investment in our own wellbeing but in that of others. Every coffee we buy employs a barista. Every purchase we make on our credit cards literally creates money (because that’s all money is, credit and debt in motion) .

When confronted with this – and the manifest injustices and distortions created by money and the economy – some are tempted to lurch into a reactive and paranoid brand of simplistic opposition. Like their other-blaming brethren in the Nazi Party and IS, the cookie cutter conspiracist sheets home all culpability to a nominated and thoroughly evil enemy that only a select few ‘awakened’ warriors of truth are keen to confront. Whether it’s the Rothschilds, the Tri-lateral Commission or Rupert Murdoch, conspiracists tend to prefer their targets easily categorised and without redeeming features. In fact, so thoroughly do some of them partake in the dehumanisation of their foe that they cast them as shape-shifting lizards posing as European royalty and other so called elites.

Clearly, these constructions are little more than dystopian fantasies and, like all fundamentalist beliefs, are glaringly one-sided and built upon the rationalisation of various fears and the related urge to blame others for pretty much everything. They also rest upon an underlying view that things unfold in a linear fashion, like a story or movie plot.

Whilst we might argue that the narrative or dialectic model works as a means for understanding the sweep of history, the economy – in its everyday practise – is an entirely different beast. The economy is a (vertically and laterally scaled) network, and all of us are nodes in its intricate lattice of inter-connection. And this is where you and I come in.

Even down here at the level of the ordinary citizen, we participate in the tribal exchange. Decisions we make about spending and saving, or whether to lend a friend a few bucks, are not only an investment in our own wellbeing but in that of others. Every coffee we buy employs a barista. Every purchase we make on our credit cards literally creates money (because that’s all money is, credit and debt in motion).3

Yet, however small our individual participation in the economic order is, between us we have bought the world we find ourselves in. Think of it thus:

  • By buying that $5 t-shirt from the chain store I am saying yes to the practise of moving textile industry jobs to cheap labour markets
  • By preferring only the perfect looking fruit I am encouraging retailers and growers alike to do whatever it takes to create cute apples; which means spraying, waxing and lots of waste
  • By voting for low-tax parties I am voting to abolish, cut or restrict social services, reduce public infrastructure spending, sell off public assets to private companies and, as a result, to accept the consequences of the ‘user pays’ model, even if I can’t afford it.

Clearly, I could list countless examples here – but the point is obvious. Everything in the economy affects everything else. Demand stimulates supply. My expenditure is your income. Profit makes hiring viable. Wages subsequently get spent and so it goes. Wealth is generated by the very fact of exchange. Even the entrepreneurship and risk taking beloved of capitalist cheer leaders would be useless without the vast social network of trade.

This would be a trivial observation were it not for the fact that it rarely occurs to us. By neglecting or forgetting this we effectively cede the ground to narrower ideologies, to the myths of market puritans and the idiotic babble of what passes for ‘debate’ in modern democracies. What’s more, by refusing to accept responsibility for our part in the money matrix, we make ourselves vulnerable to those who would exploit our blindness (and the fears it can fuel) for profit, persuasion and power. Demagogues, conspiracy peddlers and opportunistic politicians bank on our failure to join the dots.4

Whereas some will regard this as evidence of the aforementioned conspiracy, I would argue that it arises from psycho-emotional factors much closer to home. We are an opportunistic animal. Leave a door ajar and someone will open it. Express a wish and, if there’s a quid in it, someone will try to make it come true. Or, in strictly economic terms, supply mostly follows demand – and when it doesn’t there’s advertising, with its mission to ‘create desire.’

What emerges from this are a few simple but profoundly empowering realisations. The so-called economy is a monetised version of social transaction. It is a whole-of-herd conversation about what is of value, who can be trusted, and the risks associated with that trust. Money is the oil, the blood, the literal flow of trust and risk throughout the tribal body.  

Augment this with our preference for simple either/or explanations and the prevalence of entitlement thinking and blame shifting, and you have a recipe for the kind of wilful blindness that requires relatively few clear sighted folks to exploit.

The manner of its circulation – is it efficient or obstructed, what is the cost of a transfusion and who gets to have one? – tells us how much trust we have and, on the flipside, how suspicious and fearful we are. Thus, if we look around and observe an economy rife with injustice, if credit is too hard to find or too opaque to understand, and short term profit wins out over the ecological viability of our species, what we’re really looking at is a mathematical snapshot of the soul of humanity. Economics is group psychology in numbers. It is the denomination of belief and behaviour. And the bottom line is that it shows us how much we value one another.

On the face of it, this may seem depressing – but when we extricate economic activity from the noise of politics and the jargon of the financial sector, and return it to the shared tribal space, we can begin to reclaim joint ownership. Then, as shareholders in the multinational company called civilisation, we are prompted to accept responsibility for what the company produces and where its dividends flow.

We are familiar with the image of the passive consumer; yet most of us in the First World have the capacity to become active consumers. If we are conscious of the nexus between spending and what it produces we can begin to send market signals that foster the kind of economy and society we prefer. Although the majority of us will only ever make a relatively tiny impact, our psychology and behaviours change when we remind ourselves of the core social reality at work in the economy. So, even if our spending habits remain, we understand that we are accountable for what our dollar truly buys, and that we are neither powerless nor disconnected.

In a culture rife with the ‘slave narratives’ of the helpless/righteous victim of oppression and inevitability, our shared ownership of the economy and our responsibility for it seem counter-intuitive. This is because we don’t really trust one another that much, and we still routinely divide into crude us/them groups. Augment this with our preference for simple either/or explanations and the prevalence of entitlement thinking and blame shifting, and you have a recipe for the kind of wilful blindness that requires relatively few clear sighted folks to exploit.             

Ultimately, whether we like it or not, the economy is a fundamental part of human society. It is the process of trading the things we either need or desire. Money is simply the blood in the veins of all our transactions, and the interest we charge on it is the price we pay for the risk of extending trust. Indeed, in tribes too big to be personal, like cities and countries, society itself is a credit purchase, with laws and moral injunction as the interest rate.

So, when we say that money is the root of all evil what we’re really suggesting is that society, that people, that we ourselves are the source of all the cynicism, vampirism and unsustainable hubris so typical of our communal balance sheet.

Money is blood; and if there really is a blood borne virus in our system, we know how it got there.


1: Before switching to the $US the Pacific island of Yap famously used rocks as currency, some of which weighed tonnes and were clearly impractical as movable tokens. Thus, although these heavy limestone discs were not physically exchanged, the value (or purchasing power) they represented in the island economy was transferable. The key here is that the rocks’ value is less that of a commodity and more that of a tribally agreed account of credit and debt.    

2: To be fair, let’s also acknowledge that repressive regimes, of whatever ideological flavour, also have the effect of creating economies and societies of fear and mistrust. The free market is not alone in throwing up anti-social psychopaths and lionising their exploits.  

3: Since money is not physical (but psychological) there is no hard ceiling on how much of it we can ‘print’ and although there are obvious reasons to prudently constrain supply, every time we borrow money from a bank it is literally created because debt (and credit) is money. So, if buy a $25 t-shirt on my credit card I immediately incur a $25 debt, which my bank then transfers as a $25 credit to the retailer, who can then spend it as money on anything they choose. That $25 didn’t require an amount of gold or a handful of beads to be lodged in a vault somewhere; all it required was that between us (me, bank, shop) a smooth transfer of debt/credit be agreed. Then, provided that $25 is universally recognised as being worth $25…voila, it instantly becomes money.                

4: This is sometimes referred to as the exploitation of asymmetries. In other words, where one party has more power, knowledge, etc and utilises that advantage to manipulate the choices and thinking of the other, less informed, more powerless party. It is, in my view, ubiquitous in both the market and the political space. The inane garbage that media and politicians routinely spout in Western democracies is perhaps the most egregious example of this.  

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