Notes on Gift Economics and Money

Charles Eisenstein’s Sacred Economics   

A. The Spirit of the Gift  

1. Sacredness and Money - Uniqueness and Relatedness versus money as abstract, comparative, quantitative, anonymous. Money as destroying sacredness of things and beings: Money as homogeneous, purely quantitative, homogenizes everything it touches. Money turns things into commodities - things equal (in value) to the money that can buy/replace them. Money turns unique individuals into producers and consumers - people who despite all their complex differences and unique motivations all want the same thing: money. Biology infected with the same ideology: selfish genes maximizing reproductive self-interest.

2. The Spirit of the Gift: Life as a Gift - gratitude as a response; talents as gifts, meant to be developed, giving life purpose; gifts are meant to be shared. 

3. Gift economies as the origin of money, not barter; Adam Smith’s story from The Wealth of Nations (1776) fails to find confirmation by economic anthropology. Barter/money as forms of exchange versus gifting as circulation (e.g. The Trobriand Islanders’ kula system.)

4. Surplus is always shared. “Gifts flow continuously, only stopping in their circulation when they meet a real, present need…. “Our generosity may leave us empty, but our emptiness then pulls gently at the whole until the thing in motion returns to replenish us. Social nature abhors a vacuum.” (Lewis Hyde quoted by C.E. p.7)

5. Gifts create connection (bonding and obligation - open-ended) versus exchange (money/barter) which maintains equality as separateness (closed out-finished). Gifts widen the ‘circle of the self.’ System coherence as a ‘web of gifts.’

6. The word "community" is derived from the Old French communité which is derived from the Latin communitas (com, "with/together" + munus, "gift"), a broad term for fellowship or organized society.

B. Scarcity

7. Is the lack of money necessary for “making a living” the result of greed or of the design (intended or otherwise) of the monetary system? 

8. Is scarcity a true premise of economic/biological realities or a protection of the false ideology of modern economics (modern materialism, the modern ‘story of the separate self (ego)’? 

9. Is the world economy unable to support the human population due to scarcity or due to waste? Does greed lead to wealth or does wealth make people greedy?

Forms of waste: military, McMansions, industrial food system, planned obsolescence, overconsumption.

10. Scarcity as a creation of economic growth: e.g. free and abundant versus costly bottled water, childcare as abundant in village life versus a costly expense for modern families; time as infinite versus never enough.

C. Money

11. Theories of the origin of money: markets (evolving from limitations of barter), governments (legal tender for tax purposes/financing standing armies), religion (offering to the temple), extension of the gift economy (money as a token of gratitude). 

12. Functions of money as a tool/ technology

(a) A medium of exchange

(b) A store of value

(c) A unit of measurement

(d) Source of political and social power

13. Essence of money

(1) as a commodity, such as gold or silver - Money as a thing

(2) as a legal concept created by legislation - Money as an agreement, I.e. an IOU.

14. “Money has value because of skilled people, resources, and infrastructure, working together in a supportive social and legal framework. Money is the indispensable lubricant that lets them “run.” It is not tangible wealth in itself, but a power to obtain wealth. Money is an abstract social power based in law; and whatever government accepts in payment of taxes will be money. Money’s value is not created by the private corporations that now control it. As Aristotle wrote: “Money exists not by nature but by law.”

C. Source of money: fractional reserve banking

15. “In our present system, the Federal Reserve Bank of New York, one of the 12 private Federal Reserve branch banks, begins the process by creating money out of thin air. Then using this money as a reserve base, the rest of the banks create about ten or more times that amount of money out of thin air by what’s called “fractional reserve banking.” When banks issue loans, they are creating money (as debt). By deciding who gets the money, and how cheap that money is, they get to decide the direction our society grows in.”

I.e. Banks turn private IOUs into money by guaranteeing your IOUs to the larger market. 

16. “The power to create money is an awesome power – at times stronger than the Executive, Legislative and Judicial powers combined. It’s like having a “magic checkbook,” where checks can’t bounce. When controlled privately it can be used to gain riches, but much more importantly it determines the direction of our society by deciding where the money goes – what gets funded and what does not. Will it be used to build and repair vital infrastructure such as the New Orleans levees and Minneapolis bridges to protect major cities? Or will it go into warfare and real estate loans creating the real estate bubble – leading to a crash and depression…” (HR6550)