Money Notes. Toward a Sociology of Money

August 21st, 2008 Posted in Money

Money is an old human discovery continually revised. It has changed according to era and ideology. In our time it has been stripped of intrinsic value. It is no longer a commodity as well as a universal numerical sign. It is a price tag whose own value does not affect the value of the object it labels. Paper money, base coins and electronic bits that now physically are money, have a trivial cost of production at most. Gold, silver, copper and a variety of substitutes (products and trinkets) that have been used as the universal mark in the past had commodity value themselves. The value of the goods and services marked were buffeted by the fluctuations of two markets. Money is a clean tag now closely approximating nothing.

Current universal markers approach being pure cultural artifacts–the value given them is in the arbitrary cultural consensus (supported by law and the force of the state authority.) The sign almost does not exist. It is like the space beyond space–an act of joint social imagination.

But even so, and paradoxically, this empty tag is itself treated as a real object (like a good or service) and used in transactions where the exchange of this for that involves only the empty sign. There are markets for money alone… (1) in the exchange of different sets of money (foreign exchange) . (2) in the lending of money to be repaid with interest (money begetting money). (3) in institutions represented by formal social organizations that deal exclusively in money. (4) in the speculative trade for stocks and commodities whose material base is of marginal interest only. Money, looked at in its current form separated from its cultural base, truly would seem to be much ado about nothing. And these activities involve much, much ado.

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Caveat. I am speculating from my own ordinary and limited experience. My objective is to outline the various possible sectors of a sociology of money. Like a batter in baseball I will miss the ball with some swings but perhaps get an occasional hit. No matter. The challenge to others is to correct faults and to improve on any successes. The act establishes the game–in this case the socio-cultural appreciation of money. One can only strike out if the game exists.

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So money is a sign and a commodity. Its production, maintenance and management is instituted in banking and associated organizations that include the government treasury department and the mints and the central Federal Reserve. A large industry of many workers who are managed by trained, skilled economists who act as specialized servants to the cadre regimes in power. Their objective is to keep the money system working evenly and with minimal turbulence.

But when there is a crisis these leading servants are expected to respond quickly and to minimize any disruption and to bring the system back to stability. The idea of stability varies but it generally involves expanding economic activity called growth, increases in income, jobs, productivity throughout the entire society. We think of the system that works as being in a state of prosperity.

At the center of a sociology of money is the economic institution–the organizations and people who carry out the money work. We are all involved but most of us at the simple level of accepting things as they are in everyday life–buying and selling, saving, lending and borrowing, paying taxes, receiving stipends, subsidies, rebates, wages and so on. But the center (but not a totally singular center) has the greatest impact. Drama and significance and scale emerge with amounts of money in circulation, interest rates, tax policy, the issuance of subsides and grants and so on. The agents at the center of these centers (along with the political cadres) have the critical roles in the money process.

One of the tasks of a sociology of money-economics is to describe this class of managers and the organizational means and processes through which they operate. I would guess that they now are professional economists (trained in specialized schools) who have been selected and nurtured upward through a variable career path to eventual placement as senior servants in key organizational slots. Usually there are a lot more qualified people for the key jobs than are actually needed. There is a rotation through commercial, academic, and governmental positions and people within the field can spot the more skilled and creative operatives. The challenge of fitting maximally the creative and responsive person to senior responsibility during a particular kind of crisis is unending.

Similar coteries of trained and skilled public servants are in all institutions. The phenomena goes beyond money and economics: in the military, the diplomatic corps, in merchandising, manufacturing, espionage and so on. The ideal and comic model is in the form of the famous bumbling British civil service, but in the U.S.A. it is more informal and open though there is a tendency to be closed off to outsiders with unconventional careers. Many of these servants/savants labor anonymously (as do most of the rest of us) in non-famous sectors. Most of us though have a fair idea of how, where and when what we do counts. This kind of accounting is not a money-thing.

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These servants-savants can be thought of as experts in the means (how to get where we want to go). They can set up the agencies and processes that get specific things done. The directives that govern the choice of goals and policies come from the currently governing cadre who funnel selected requests for advantage from various sectors of the society whether these make sense to the managers or not. So tax law and subsidies and enforcement policies are set mainly by the legislature and executive (the sovereign functions) and become part of the situation that confronts the managers. Traditionally the servants have an independent influence. They can facilitate or thwart the will of the political cadres. The more they go in this direction the more political they become and the more vulnerable.

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Responding to threats to the money-economy is a key responsibility of the servant managers aided or hampered by the governing politicos. These crises take two (not quite independent) forms:

(1) The endemic glitches that are part of the system itself that are constant threats. Ideally the neo-capitalist system in place works placidly over ever expanding eras. With division of labor, the free labor and commercial markets, the availability of resources and tools, and an equitable money marker scheme in place the economy should fall into a continually expanding nirvana–the best of all possible worlds. But there are tendencies, obvious because they are continually repeated, that lead to alarms and crises and threaten possible disintegration and chaos. We are all familiar with inflation, boom and bust cycles, falling rate of profit, development of a surplus and its distribution, default of debts, class struggle, and such.

(2) There are challenges of alternate visions and ideologies that represent tendencies suppressed in our current way that the savants and their supporters are continuously mobilized against. Presumptions about property rights, the nature of debt, the definition of the good and proper life are highlighted and unchallenged as though the parts selected for emphasis were the whole. The contradictions and opposites are always with us: self versus the collective (or egoism and altruism), the universal versus the particular, the achieved versus the inherited, wealth versus poverty, equality versus exploitation, and such. The rejected in any established way continue as process and as contradiction. They surface in critiques and complaints and in political and moral movements, and as crime, discontent, neuroses (a form of psychological adjustment). The process is most clearly seen in distant societies. The denial of civil rights in China for example. For their leading cadres these rights seem divisive and anti-social as well as against the advantaged sectors of an on-going order. The specialist savants are involved in these partisan ideological struggles. Their science tends to be organized around a very specific and limited world (and this very fact is part of their struggle agenda.) What they do is support (acknowledged or not) a particular governing ideology.

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Please note that our continuing argument through these posts that sociology can not be a hard science is supported by any attempt to formulate a sociology of money. If you do not fall into values and morals you miss the mark.