82,927
edits
Debt: The First 5,000 Years: Difference between revisions
no edit summary
Amwelladmin (talk | contribs) No edit summary |
Amwelladmin (talk | contribs) No edit summary |
||
| (2 intermediate revisions by the same user not shown) | |||
| Line 1: | Line 1: | ||
{{a|book review| | {{a|book review| | ||
{{image|Debt|jpg|450px|frameless|center}} }}{{quote|“{{graeber on debt}}” | |||
}}{{quote|“{{graeber on debt}}” | |||
:—{{author|David Graeber}}}} | :—{{author|David Graeber}}}} | ||
The behavioural economist Uri Gneezy once ran a famous experiment on incentives at a chain of daycare centres in Haifa. | The behavioural economist Uri Gneezy once ran a famous experiment on incentives at a chain of daycare centres in Haifa. | ||
To incentivise parents to pick up their kids on time, the centre introduced a small but meaningful “late fee” for those who were more than ten minutes late. But rather than this reducing late pick-ups, average delinquency in those centres ''doubled''. What happened? | To incentivise parents to pick up their kids on time, the centre introduced a small but meaningful “late fee” for those who were more than ten minutes late. But rather than this reducing late pick-ups, average delinquency in those centres ''doubled''. What happened? Gneezy surmises: the fixed penalty put a ''monetary value'' on the inconvenience: it converted a ''moral'' obligation into a ''financial'' one. In doing so something meaningful was lost. | ||
That something is the motivating force behind this highly entertaining, learned, and stimulating book. David | That something is the motivating force behind this highly entertaining, learned, and stimulating book. [[David Graeber]]’s history —and there’s plenty of history, right back to the myth — yes, myth — of the foundation of money in [[barter]] — poses this central question: what happens when we reduce our sense of morality and justice to the language of a business deal? | ||
“What,” Graeber asks in the first chapter, “does it mean when we reduce moral obligations to | “What,” Graeber asks in the first chapter, “does it mean when we reduce moral obligations to [[debt]]s?” | ||
Now | Now, denizens of the financial services industry should understand that [[David Graeber|Graeber]] did not come at this question from what we would call a conventional place. He was an anthropologist, not an economist or a historian, and of the anarchist left: he was instrumental in establishing the ''Occupy Wall Street'' movement. But it would be a grave mistake to write off his book as a Marxist screed. There is so much of value here: in challenging conventional, lazy and simplistic ways we have at looking at the world. It is well researched and thoughtfully argued. Graeber perfectly understood conventional wisdom. It is just that he was ... what’s the word? — oh that’s it: a ''contrarian''. It is also beatufully, and | ||
The best thing to do is just pick out some choice points. | The best thing to do is just pick out some choice points. | ||
| Line 29: | Line 28: | ||
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. | ||
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 | 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 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. 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 | 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 owes to its parent for its upbringing. Should the child repay that debt in full? Can it? And more tellingly, if it does, what does that say about the future of the relationship between that parent 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 contract|relationship]] is necessarily greater the present value of any transaction, because if the relationship stays healthy ''there will be more transactions''. | 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 contract|relationship]] is necessarily greater the present value of any transaction, because if the relationship stays healthy ''there will be more transactions''. | ||