is something about money I do not get. I understand bartering. Two
people exchange things that have roughly equal value. But modern
money as a concept makes little sense. Milton Friedman, in Money
Mischief, writes that money, as we know it, has no intrinsic value
and what gives it value is that it is used for exchange. He goes
on to say that the value is what we attribute to it, and all money
is credit money, a contractual IOU for an incomplete
exchange. As Aristotle said, the value of money is derived
not from nature, but from law.
money is made by the meaning we give it yet, at the same time, it
apparently makes the world go around. If you do not have it, your
life can be miserable. Nevertheless, money or, to be precise, currency,
which is the physical embodiment of the idea of money, cannot buy
happiness only a new iPod or a fridge. But the more money
one is talking about the less concrete the notion gets. Bill Gates,
for example, is apparently worth $27-billion, but he does not have
$27-billion dollars in the same way a person has 1 000 cattle.
is a rich man with jets and houses but, mainly, he has more IOUs
than the rest of us. His bank does not have a vault with $27- billion
crisp $100 bills in it, ready for Bill to dive into whenever the
urge takes him.
have enormous amounts of unseen money. At a government level, finance
is based on promises and IOUs. It is about shuffling budgets of
virtual money and meeting obligations. These obligations boil down
to where they want to commit make-believe dosh. These choices can
have tragic and visible consequences.
means different things to different people. I recall working with
a community group in South Africa and discussing a grant to support
people around the truth commission. One community member commented:
We have been thinking that we dont want to use the money
for that rather, we want to share the grant out between us.
The group would have preferred an instant R500 each rather than
a long-term, less-tangible benefit. Money as a thing, or at least
the objects R500 could buy when you are poor, was more important.
The man had a point, but the donor would have seen it differently.
Donor and grantee had conflicting desired outcomes. But what determines
these outcomes? Who controls these fantasy purse strings? A recent
report in the UK claimed that lack of resources in the security
services led to the London bombings last year. But at the same time
the country spends £3-billion a year on the occupation of
Iraq. The US government finds $100-billion a year for its Iraq folly.
When the amounts of money get this astronomical, the meaning of
the money becomes even more ephemeral. The only way to make sense
of it is to break figures down into numbers we think we can compute.
My calculations go like this: the UK and US governments are spending
roughly $110-billion a year in Iraq. This is five times the gross
domestic product (GDP) of Mozambique and is the equivalent of about
20% of the annual GDP of South Africa.
even more staggering is that the money invested in making this war
is more than the Iraqi GDP, estimated at $97-billion in 2005. Does
this incredible statistic make sense to anyone? I once met a businessperson
who told me he owed his bank half a million pounds, or R5-million.
I remember thinking he was the only person I knew who was rich enough
to be half a million pounds in debt. Does that make sense to anyone?
Answers on a postcard, please.
Hamber writes the column "Look South": an analysis
of trends in global political, social and cultural life and its
relevance to South Africa on Polity, see http://www.polity.co.za/pol/opinion/brandon/.
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