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Debt: The First 5,000 Years: Difference between revisions
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The distinction between a [[debt]] — quantifiable obligation to pay a sum of money on a certain date; which in its [[fungibility]] and transferability is an impersonal thing — and a personal obligation in the wider sense (the same distinction between a [[liability]] and an [[obligation]]) is profound, and we lose something important when we ignore it. | The distinction between a [[debt]] — quantifiable obligation to pay a sum of money on a certain date; which in its [[fungibility]] and transferability is an impersonal thing — and a personal obligation in the wider sense (the same distinction between a [[liability]] and an [[obligation]]) is profound, and we lose something important when we ignore it. | ||
This, it seems to me, goes deep. It resonates strongly with observations by a diverse range of impressive writers – James Scott, Jane Jacobs, Rory Sutherland, W. Edwards Deming Nassim Taleb — that far from being indicators of of weakness and a feeble governance, a certain looseness — planned slack and redundancy — in fact speak to confidence in one’s purpose. They are vital to the durability and flexibility of any enterprise. | This, it seems to me, goes deep. It resonates strongly with observations by a diverse range of impressive writers – {{author|James C. Scott}}, {{author|Jane Jacobs}}, {{author|Rory Sutherland}}, {{author|W. Edwards Deming}}, {{author|Nassim Nicholas Taleb}} — that far from being indicators of of weakness and a feeble governance, a certain looseness — ''planned'' slack and redundancy — in fact speak to ''confidence'' in one’s purpose. They are vital to the durability and flexibility of any enterprise. | ||
This is Graeber’s point: we should always leave something on the table. | This is Graeber’s point: we should always leave something on the table. To leave something unsaid builds trust; it strengthens ties; it reinforces the sense of relationship and personal obligation. By way of reductio ad absurdum Graeber takes the debt that a child goes to its parent for its upbringing. Should the child repay that debt in full? Kennett? And more tellingly, if it does, what does that say about the future of the relationship between that parrot and that child? Is it over? Thus, the absurdity of treating interpersonal relationships as some kind of ledger of account. Yet what ''is'' business if it is not a complex web of interpersonal relationships? | ||
Yet this is what our current [[modernist]] orthodoxy promises to do: to convert what should be interpersonal relationships — life — into a sterile ledger of account — to comprehensively ''monetise'' it. But you literally cannot put a value on “doing the right thing”. The economic equivalent — “discharging one’s obligations” is to do the bare minimum. It is is a “cheapest to deliver” option. When the bare minimum fully discharges your contractual obligation, your relationship is moot. As we have observed many times in these pages, the ''potential'' forward value of a business [[relationship]] is necessarily greater the present value of any transaction, because if the relationship stays healthy ''there will be more transactions''. | |||
But the point goes even deeper | Of course, the smartest firms realise this; only, over their accountants’ objections. | ||
But the point goes even deeper, for we cannot, even if we want to, fully articulate the financial value, or risk, of our commercial situation, imperfect as our information is, and shifting as the dynamics of the landscape necessarily are. The redundancy commerce lack and overlap is the fat we burn to adapt to our changing circumstances. | |||
===Exchange and cancellation of debts=== | ===Exchange and cancellation of debts=== | ||
An ongoing relationship implies a complicated web of reciprocal obligations (in the wider sense): these are not an imposition of a cost to the relationship, but its fuel: in a sense a relationship is a preparedness to grant, and accept, indulgences over time. That one is “obliged” is a ''good'' thing: literally, to be in a relationship is to be ''bound'' to one another. Thus, to exactly reconcile one’s outstanding obligation to another exactly — to leave nothing on the table — is to indicate that one wants the relationship to end: one wants the freedom to leave. | An ongoing relationship implies a complicated web of reciprocal obligations (in the wider sense): these are not an imposition of a cost to the relationship, but its fuel: in a sense a relationship is a preparedness to grant, and accept, indulgences over time. That one is “obliged” is a ''good'' thing: literally, to be in a relationship is to be ''bound'' to one another. Thus, to exactly reconcile one’s outstanding obligation to another exactly — to leave nothing on the table — is to indicate that one wants the relationship to end: one wants the freedom to leave. | ||