MONEY

​The Poor Man's Credit Card

​Central   to  modern   psychoanalytical   theory  is  the  relation between the money complex and the human body. Some analysts derive money from the infantile impulse to play with faeces. Ferenczi, in particular, calls money "nothing other than odorless dehydrated filth that has been made to shine." Ferenczi, in his concept of money, is elaborating Freud's concept of "Character and Anal Erotism." Although this idea of linking "filthy lucre" with the anal has continued in the main lines of psychoanalysis, it does not correspond sufficiently to the nature and function of money in society to provide a theme for the present chapter. 

Money began in nonliterate cultures as a commodity, such as whales' teeth on Fiji; or rats on Easter Island, which later were considered a delicacy, were valued as a luxury, and thus became a means of mediation or barter. When the Spaniards were besieging Leyden in 1574, leather money was issued, but as ​hardship increased  the  population  boiled  and  ate  the  new currency. 

In literate cultures, circumstances may reintroduce commodity money. The Dutch, after the German occupation of World War II, were avid for tobacco. Since the supply was small, objects of high value such as jewels, precision instruments, and even houses were sold for small quantities of cigarettes. The Reader's Digest recorded an episode from the early occupation of Europe in 1945, describing how an unopened pack of cigarettes served as currency, passing from hand to hand, translating the skill of one worker into the skill of another as long as no one broke the seal.

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Money always retains something of its commodity and community character. In the beginning, its function of extending the grasp of men from their nearest staples and commodities to more distant ones is very slight. Increased mobility of grasp and trading is small at first. So it is with the emergence of language in the child. In the first months grasping is reflexive, and the power to make voluntary release comes only toward the end of the first year. Speech comes with the development of the power to let go of objects. It gives the power of detachment from the environment that is also the power of great mobility in knowledge of the environment. So it is with the growth of the idea of money as currency rather than commodity. Currency is a way of letting go of the immediate staples and commodities that at first serve as money, in order to extend trading to the whole social complex. Trading by currency is based on the principle of grasping and letting go in an oscillating cycle. The one hand retains the article with which it tempts the other party. The other hand is extended in demand toward the object which is desired in exchange. The first hand lets go as soon as the second object is touched, somewhat in the manner of a trapeze artist exchanging one bar for another. In fact, Elias Canetti in Crowds and Power argues that the trader is Involved in one of the most ancient of all pastimes, ​namely that of climbing trees and swinging from limb to limb. The primitive grasping, calculating, and timing of the greater arboreal apes he sees as a translation into financial terms of one of the oldest movement patterns. Just as the hand among the branches of the trees learned a pattern of grasping that was quite removed from the moving of food to mouth, so the trader and the financier have developed enthralling abstract activities that are extensions of the avid climbing and mobility of the greater apes. 

​Like any other medium, it is a staple, a natural resource. As an outward and visible form of the urge to change and to exchange, it is a corporate image, depending on society for its institutional status. Apart from communal participation, money is meaningless, as Robinson Crusoe discovered when he found the coins in the wrecked ship: 

I smiled to myself at the sight of this money. "O drug!" said I aloud, "What art thou good for? Thou art not worth to me --no, not the taking off the ground: one of those knives is worth all this heap: I have no manner of use for thee; e'en remain where thou art and, go to the bottom, as a creature whose life is not worth saving." 
However, upon second thoughts, I took it away; and wrapping it all in a piece of canvas, I began to think of making another raft . . . 

Primitive commodity money, like the magical words of non-literate society, can be a storehouse of power, and has often become the occasion of feverish economic activity. The natives of the South Seas, when they are so engaged, seek no economic advantage. Furious application to production may be followed by deliberate destruction of the products in order to achieve moral prestige. Even in these "potlatch" cultures, however, the effect of the currencies was to expedite and to accelerate human ​energies in a way that had become universal in the ancient world with the technology of the phonetic alphabet. Money, like writing, has the power to specialize and to rechannel human energies and to separate functions, just as it translates and reduces one kind of work to another. Even in the electronic age it has lost none of this power. Potlatch is very widespread, especially where there is ease of food-gathering or food-production. For example, among the Northwest coast fishermen, or rice-planters of Borneo, huge surpluses are produced that have to be destroyed or class differences would arise that would destroy the traditional social order. In Borneo the traveler may see tons of rice exposed to rains in rituals, and great art constructions, involving tremendous efforts, smashed. At the same time, in these primitive societies, while money may release frantic energies in order to charge a bit of copper with magical prestige, it can buy very little. Rich and poor necessarily live in much the same manner. Today, in the electronic age, the richest man is reduced to having much the same entertainment, and even the same food and vehicles as the ordinary man.

The use of a commodity such as money naturally increases its production. The nonspecialist economy of Virginia in the seventeenth century made the elaborate European currencies quite dispensable. Having little capital, and wishing to put as little of this capital as possible into the shape of money, the Virginians turned to commodity money in some instances. When a commodity like tobacco was legislated into legal tender, it had the effect of stimulating the production of tobacco, just as the establishment of metallic currencies advanced the mining of metals. Money, as a social means of extending and amplifying work and skill in an easily accessible and portable form, lost much of its magical power with the coming of representative money, or Paper money. Just as speech lost its magic with writing, and further with printing, when printed money supplanted gold the ​compelling aura of it disappeared. Samuel Butler in Erewhon (1872) gave clear indications in his treatment of the mysterious prestige conferred by precious metals. His ridicule of the money medium took the form of presenting the old reverent attitude to money in a new social context. This new kind of abstract, printed money of the high industrial age, however, simply would not sustain the old attitude: 

This is the true philanthropy. He who makes a colossal fortune in the hosiery trade, and by his energy has succeeded in reducing the price of woollen goods by the thousandth part of a penny in the pound --this man is worth ten professional philanthropists. So strongly are the Erewhonians impressed with this, that if a man has made a fortune of over/2O,ooo a year they exempt him from all taxation, considering him a work of art, and too precious to be meddled with; they say, "How very much he must have done for society before society could have been prevailed upon to give him so much money"; so magnificent an organization overawes them; they regard it as a thing dropped from heaven. "Money," they say, "is the symbol of duty, it is the sacrament of having done for mankind that which mankind wanted. Mankind may not be a very good judge, but there is no better." This used to shock me at first, when I remembered that it had been said on high authority that they who have riches shall enter hardly into the kingdom of heaven; but the influence of Erewhon had made me begin to see things in a new light, and I could not help thinking that they who have not riches shall enter more hardly still. 

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Earlier in the book, Butler had ridiculed the cash-register morality and religion of an industrialized world, under the guise of the "Musical Banks," with clergy in the role of cashiers. In the present passage, he perceives money as "the sacrament of having ​done for mankind that which mankind wanted." Money, he is saying, is the "outward and visible sign of an inward and invisible grace. " Money as a social medium or extension of an inner wish and motive creates social and spiritual values, as happens even in fashions in women's dress. A current ad underlines this aspect of dress as currency (that is, as social sacrament or outward and visible sign) "The important thing in today's world of fashion is to appear to be wearing a popular fabric." Conformity to this fashion literally gives currency to a style or fabric, creating a social medium that increases wealth and expression thereby. Does not this stress how money, or any medium whatever, is constituted and made efficacious? When men become uneasy about such social values achieved by uniformity and repetition, doing for mankind that which mankind wants, we can take it as a mark of the decline of mechanical technology.

​"Money talks" because money is a metaphor, a transfer, and a bridge. Like words and language, money is a storehouse of communally achieved work, skill, and experience. Money, however, is also a specialist technology like writing; and as writing intensifies the visual aspect of speech and order, and as the clock visually separates time from space, so money separates work from the other social functions. Even today money is a language for translating the work of the farmer into the work of the barber, doctor, engineer, or plumber. As a vast social metaphor, bridge, or translator, money -- like writing --speeds up exchange and tightens the bonds of interdependence in any community. It gives great spatial extension and control to political organizations, just as writing does, or the calendar. It is action at a distance, both in space and in time. In a highly literate, fragmented society, "Time is money," and money is the store of other people's time and effort. 

During the Middle Ages the idea of the fisc or "the King's purse" kept the notion of money in relation to language ("the ​King's English") and to communication by travel ("the King's highway"). Before the advent of printing, it was quite natural for the means of communication to be regarded as extensions of a single body. In an increasingly literate society, money and the clock assumed a high degree of visual or fragmented stress. In practice, our Western use of money as store and translator of communal work and skill has depended upon long accustomation to the written word, and upon the power of the written word to specialize, to delegate, and to separate functions in an organization.

​When we look at the nature and uses of money in nonliterate societies, we can better understand the ways in which writing helps to establish currencies. Uniformity of commodities, combined with a fixed-price system such as we now take for granted, does not become possible until printing prepares the ground. "Backward" countries take a long time to reach economic "takeoff' because they do not undergo the extensive processing of print with its psychological conditioning in the ways of uniformity and repeatability. In general, the West is little aware of the way in which the world of prices and numbering is supported by the pervasive visual culture of literacy. 

Nonliterate societies are quite lacking in the psychic resources to create and sustain the enormous structures of statistical information that we call markets and prices. Far easier is the organization of production than is the training of whole populations in the habits of translating their wishes and desires statistically, as it were, by means of market mechanisms of supply and demand, and the visual technology of prices. It was only in the eighteenth century that the West began to accept this form of extension of its inner life in the new statistical pattern of marketing. So bizarre did this new mechanism appear to thinkers of that time that they called it a "Hedonistic calculus." Prices then seemed to be comparable, in terms of feelings and desires, to the vast world of space that had yielded its inequities earlier to the ​translating power of the differential calculus. In a word, the fragmentation of the inner life by prices seemed as mysterious in the eighteenth century, as the minute fragmentation of space by means of calculus had seemed a century earlier. 

​The extreme abstraction and detachment represented by our pricing system is quite unthinkable and unusable amidst populations for whom the exciting drama of price haggling occurs with every transaction.

​Today, as the new vortices of power are shaped by the instant electric interdependence of all men on this planet, the visual factor in social organization and in personal experience recedes, and money begins to be less and less a means of storing or exchanging work and skill. Automation, which is electronic, does not represent physical work so much as programmed knowledge. As work is replaced by the sheer movement of information, money as a store of work merges with the informational forms of credit and credit card. From coin to paper currency, and from currency to credit card there is a steady progression toward commercial exchange as the movement of information itself. This trend toward an inclusive information is the kind of image represented by the credit card, and approaches once more the character of tribal money. For tribal society, not knowing the specialisms of job or of work, does not specialize money either. Its money can be eaten, drunk, or worn like the new space ships that are now designed to be edible.

​"Work," however, does not exist in a nonliterate world. The primitive hunter or fisherman did no work, any more than does the poet, painter, or thinker of today. Where the whole man is involved there is no work. Work begins with the division of labor and the specialization of functions and tasks in sedentary, agricultural communities. In the computer age we are once more totally involved in our roles. In the electric age the "job of work ' yields to dedication and commitment, as in the tribe.

In nonliterate societies money relates itself to the other organs ​of society quite simply. The role of money is enormously increased after money begins to foster specialism and separation of social functions. Money becomes, in fact, the principal means of interrelating the ever more specialist activities of literate society. The fragmenting power of the visual sense, as literacy separates it from the other senses, is a fact more easily identified now in the electronic age. Nowadays, with computers and electric programming, the means of storing and moving information become less and less visual and mechanical, while increasingly integral and organic. The total field created by the instantaneous electric forms cannot be visualized any more than the velocities of electronic particles can be visualized. The instantaneous creates an interplay among time and space and human occupations, for which the older forms of currency exchange become increasingly inadequate. A modern physicist who attempted to employ visual models of perception in organizing atomic data would not be able to get anywhere near the nature of his problems. Both time (as measured visually and segmentally) and space (as uniform, pictorial, and enclosed) disappear in the electronic age of instant information. In the age of instant information man ends his job of fragmented specializing and assumes the role of information gathering. Today information gathering resumes the inclusive concept of "culture," exactly as the primitive food-gatherer  worked   in  complete   equilibrium   with   his   entire environment. Our quarry now, in this new nomadic and "work-less   world, is knowledge and insight into the creative processes of life and society. 

Men left the closed world of the tribe for the "open society," exchanging an ear for an eye by means of the technology of writing. The alphabet in particular enabled them to break out of the charmed circle and resonating magic of the tribal world. A similar process of economic change from the closed to the open society, from mercantilism and the economic protection of national trade to the open market ideal of the free-traders, was ​accomplished in more recent times by means of the printed word, and by moving from metallic to paper currencies. Today, electric technology puts the very concept of money in jeopardy, as the new dynamics of human interdependence shift from fragmenting media such as printing to inclusive or mass media like the telegraph. Since all media are extensions of ourselves, or translations of some part of us into various materials, any study of one medium helps us to understand all the others. Money is no exception. The primitive or nonliterate use of money is especially enlightening, since it manifests an easy acceptance of staple products as media of communication. The nonliterate man can accept any staple as money, partly because the staples of a community are as much media of communication as  they are commodities. Cotton, wheat, cattle, tobacco, timber, fish, fur, and many other products have acted as major shaping forces of community life in many cultures. When one of these staples becomes dominant as a social bond, it serves, also, as a store of value, and as a translator or exchanger of skills and tasks. 

​The classic curse of Midas, his power of translating all he touched into gold, is in some degree the character of any medium, including language. This myth draws attention to a magic aspect of all extensions of human sense and body; that is, to all technology whatever. All technology has the Midas touch. When a community develops some extension of itself, it tends to allow all other functions to be altered to accommodate that form. 

Language, like currency, acts as a store of perception and as a transmitter of the perceptions and experience of one person or of one generation to another. As both a translator and storehouse of experience, language is, in addition, a reducer and a distorter of experience. The very great advantage of accelerating the learning process, and of making possible the transmission of knowledge and insight across time and space, easily overrides ​the disadvantages of linguistic codifications of experience. In modern mathematics and science there are increasingly mere and more nonverbal ways of codifying experience. 

​Money, like language a store of work and experience, acts also as translator and transmitter. Especially since the written word has advanced the separation of social functions, money is able to move away from its role as store of work. This role is obvious when a staple or commodity like cattle or fur is used as money. As money separates itself from the commodity form and becomes a specialist agent of exchange (or translator of values), it moves with greater speed and in ever greater volume. 

Even in recent times, the dramatic arrival of paper currency, or "representative money," as a substitute for commodity money caused confusions. Much in the same way, the Gutenberg technology created a vast new republic of letters, and stirred great confusion about the boundaries between the realms of literature and life. Representative money, based on print technology, created new speedy dimensions of credit that were quite inconsistent with the inert mass of bullion and of commodity money. Yet all efforts were bent to make the speedy new money behave like the slow bullion coach. J. M. Keynes stated this policy in A Treatise on Money: 

Thus the long age of Commodity Money has at last passed finally away before the age of Representative Money. Cold has ceased to be a coin, a hoard, a tangible claim to wealth, of which the value cannot slip away so long as the hand of the individual clutches the material stuff. It has become a much more abstract thing--just a standard of value; and it only keeps this nominal status by being handed round from time to time in quite small quantities amongst a group of Central Banks, on the occasions when one of them has been inflating or deflating its managed representative money in a different degree from what is appropriate to the behavior of its neighbours.

​Paper, or representative money, has specialized itself away from the ancient role of money as a store of work into the equally ancient and basic function of money as transmitter and expediter of any kind of work into any other kind. Just as the alphabet was a drastic visual abstraction from the rich hieroglyphic culture of the Egyptians, so it also reduced and translated that culture into the great visual vortex of the Graeco-Roman world. The alphabet is a one-way process of reduction of nonlit-erate cultures into the specialist visual fragments of our Western world. Money is an adjunct of that specialist alphabetic technology, raising even the Gutenberg form of mechanical repeatability to new intensity. As the alphabet neutralized the divergencies of primitive cultures by translation of their complexities  into  simple  visual  terms,  so representative money reduced moral values in the nineteenth century. As paper expedited the power of the alphabet to reduce the oral barbarians to Roman  uniformity of civilization, so paper money enabled Western industry to blanket the globe. 

Shortly before the advent of paper money, the greatly increased volume of information movement in European newsletters and newspapers created the image and concept of National Credit. Such a corporate image of credit depended, then as now, on the fast and comprehensive information movement that we have taken for granted for two centuries and more. At that stage of the emergence of public credit, money assumed the further role of translating, not just local, but national stores of work from one culture to another. One of the inevitable results of acceleration of information movement and of the translating power of money is the opportunity of enrichment for those who can anticipate this transformation by a few hours or years, as the case may be. We are particularly familiar today with examples of enrichment by means of advance information in stocks and bonds and real estate. In the past, when wealth was not so obviously related to ​information, an entire social class could monopolize the wealth resulting from a casual shift in technology. Keynes' report of just such an instance, in his study of "Shakespeare and the Profit Inflations," explains that since new wealth and bullion fall first to the governing classes, they experience a sudden buoyancy and euphoria, a glad release from the habitual stress and anxieties that fosters a prosperity, which in turn inspires the starving artist in his garret to invent new triumphant rhythms and exultant forms of painting and poetry. As long as profits leap well ahead of wages, the governing class cavorts in a style that inspires the greatest conceptions in the bosom of the impecunious artist.

When, however, profits and wages keep in reasonable touch, this abounding joy of the governing class is correspondingly diminished, and art then cannot benefit from prosperity. Keynes discovered the dynamics of money as a medium. The real task of a study of this one medium is identical with that of the study of all media; namely, as Keynes wrote, "to treat the problem dynamically, analyzing the different elements involved, in such a manner as to exhibit the causal process by which the price level is determined, and the method of transition from one position of equilibrium to another." In a word, money is not a closed system, and does not have its meaning alone. As a translator and amplifier,   money has exceptional powers of substituting one kind of thing for another. Information analysts have come to  the conclusion that the degree to which one resource can be substituted for another increases when information increases. As we know more, we rely less on any one food or fuel or raw material. Clothes and furniture can now be made from many different materials. Money, which had been for many centuries the principal transmitter and exchanger of information, is now having its function increasingly transferred to science and automation.

​Today, even natural resources have an informational aspect. They exist by virtue of the culture and skill of some community. 

​The reverse, however, is true also. All media –or extension of man -- are natural resources that exist by virtue of the shared knowledge and skill of a community. It was awareness of this aspect of money that hit Robinson Crusoe very hard when he visited the wreck, resulting in the meditation quoted at the beginning of this chapter.  When there are goods but no money, some sort of barter --or direct exchange of one product for another --has to occur. When, however, in nonliterate societies goods are used in direct exchange, then it is easiest to note their tendency to include the function of money. Some work has been done to some material, if only in bringing it from a distance. The object, then, stores work and information or technical knowledge to the extent that something has been done to it.  When the one object is exchanged for another, it is already assuming the function of money, as translator or reducer of multiple things to some common denominator. The common denominator (or translator) is, however, also a time-saver and expediter. As such, money is time, and it would be hard to separate labor-saving from time-saving in this operation. 

​There is a mystery about the Phoenicians, who, although they were avid maritime traders, adopted coinage later man the landed Lydians. The reason assigned for this delay may not explain the Phoenician problem, but it draws sharp attention to a basic fact about money as a medium; namely, that those who traded by caravan required a light and portable medium of payment. This need was less for those who, like the Phoenicians,  traded by sea. Portability, as a means of expediting and extending the effective distance of action, was also notably illustrated by papyrus. The alphabet was one thing when applied to clay or stone, and quite another when set down on light papyrus. The resulting leap in speed and space created the Roman Empire.

In the industrial age the increasingly exact measurement of work revealed time-saving as a major aspect of labor-saving. The ​media of money and writing and clock began to converge into an organic whole again that has brought us as close to the total involvement of man in his work, as of native in a primitive society, or of artist in his studio. 

​Money in one of its features provides a natural transition to number because the money hoard or collection has much in common with the crowd. Moreover, the psychological patterns of the crowd and those associated with accumulations of wealth are very close. Elias Canetti stresses that the dynamic which is basic to crowds is the urge to rapid and unlimited growth. The same power dynamic is characteristic of large concentrations of wealth or treasure. In fact, the modern unit of treasure in popular use is the million. It is a unit acceptable to any type of currency. Always associated with the million is the idea that it can be reached by a rapid speculative scramble. In the same way, Canetti explains how the ambition to see numbers mounting up was typical of Hitler's speeches.

​Not only do crowds of people and piles of money strive toward increase, but they also breed uneasiness about the possibility of disintegration and deflation. This two-way movement of expansion and deflation seems to be the cause of the restlessness of crowds and the uneasiness that goes with wealth. Canetti spends a good deal of analysis on the psychic effects of the German inflation after the First World War. The depreciation of the citizen went along with that of the German mark. There was a loss of face and of worth in which the personal and monetary units became confused. 

excerpt from the book: Understanding Media (The extensions of man) by Marshall McLuhan

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