Debt: The First 5,000 Years is my preferred introduction. Critically this New Yorker account is missing the word 'usury' which was largely agreed to be evil by early religions and societies that experienced its effects...
Apple Computers is a famous example: it was founded by (mostly Republican) computer engineers who broke from IBM in Silicon Valley in the 1980s, forming little democratic circles of twenty to forty people with their laptops in each other’s garages.
Reading around, it seems like the rest of the book is similarly accurate.
I've been trying to think of a more compact/dense incorrect sentence for a bit now, and I can't really think of an alternative. (Although some of the political screeds from the election of 1800 might have been close, and I have yet to go mine twitter for examples)
> For those who don't know how the Fed works: technically, there are a series of stages. Generally the Treasury puts out bonds to the public, and the Fed buys them back. The Fed then loans the money thus created to other banks at a special low rate of interest ('the prime rate')...
Also from "Debt, The First 5000 Years".
Just before the Apple Computers example, Graeber writes "The greater the need to improvise, the more democratic the cooperation tends to become. Inventors have always understood this, start-up capitalists frequently figure it out, and computer engineers have recently rediscovered the principle: not only with things like freeware, which everyone talks about, but even in the organization of their businesses."
It should be noted that the reasons we borrow money today is different than why it was done in the past.
In the past, the "average" person was usually a farmer, and if they needed to borrow money, it was probably because their crops had failed and they needed to money to buy food to feed themselves. It was unseemly to lend money to someone who, without it, would die.
Borrowing money nowadays is usually for mortgages and consumer spending. Very different situations, with different moral contexts.
Of course some people do still need money to survive, which is where payday loans tend to come in, and I think a lot of people find them distasteful--and the fact that people in our society may need to use them also a sad reflection on our society.
So "usury" was/is considered morally wrong not because of the charging of interest, but of the moral context under which it used to be done. There are of course 'usury laws', but they reflect the idea that charging more than x% interest unseemly because there should be no need for it (to produce a reasonable ROI).
"Medical debt is a uniquely American phenomenon, a burden that would be unfathomable in many other developed countries."
"Nearly 60 percent of people who have filed for bankruptcy said a medical expense 'very much' or 'somewhat' contributed to their bankruptcy."
https://www.theatlantic.com/health/archive/2019/03/hospital-...
Not sure that changes the relevance of the usury discussion, even if you personally are insulated from medical bankruptcy.
So the question should be - can we as a society afford decent late 20th-Century-standard care to every person? The answer is yes, we can, but we don't.
Some events are extremely rare and extremely expensive. We shouldn't expect every individual to have enough savings to pay for every eventuality.
Sharing that risk allows nearly everyone to live better.
The question here is whether that insurance should be provided by a profit-making corporation or a government agency.
Though the US system of private insurance is badly broken, evidence from other countries shows that both approaches can work.
Payday loans:
> In fact, U.S. consumers borrow almost $90 billion every year in short-term, small-dollar loans that typically range from $300 to $5,000, according to a 2018 report from the Office of the Comptroller of the Currency (OCC). [1]
> “Right now, 80 percent of payday loans are taken out within two weeks of a previous payday loan.” [1]
Much smaller by comparison, but yeah, the moral context is still there and it's egregious.
[0] https://www.magnifymoney.com/blog/mortgage/u-s-mortgage-mark...
[1] https://www.bloomberg.com/news/articles/2019-02-14/expensive...
(edit: not in the UK, which is rapidly sailing away).
This is proved untrue with minimal searching online. Here's one example: https://www.msn.com/en-gb/money/other/just-when-you-thought-...
Also search "payday loan $EU_COUNTRY" to see some pretty insane rates (>1000%).
So yes, it was 'unfair' to farmers to charge interest because it's pretty much required, but also farmers had a vested business interest in getting money lent for low interest rates.
Could you please suggest good books about economic history. I'm looking to expand my knowledge in that domain.
https://www.amazon.com/Ascent-Money-Financial-History-World/...
https://www.amazon.com/Splendid-Exchange-Trade-Shaped-World/...
https://www.amazon.com/Cash-Nexus-Money-Modern-1700-2000/dp/...
https://www.amazon.com/Devil-Take-Hindmost-Financial-Specula...
Academic but readable:
https://www.amazon.com/Manias-Panics-Crashes-History-Financi...
https://www.amazon.com/Rise-Financial-Capitalism-Internation...
A few takeaways I have from that book: 1) In rural/traditional societies, debt (measured and stored in people's heads) and other reciprocal social obligations were enough to run an economy. Simple example: you give your neighbor some grain when the harvest comes, and you neighbor repairs your tools the whole year long. The classic economy-textbook idea that we invented currency so we don't have to barter with the goods we produce has never been observed in history. 2) Governments induce the creation of currency. Any government can change the currency by requiring the repayment of taxes in that new currency. Often this is for the purposes of paying armies. 3) Traveling merchants need to use currency because they can't rely on social obligations at each place along where they travel. Money allows anonymity.
http://icm.clsbe.lisboa.ucp.pt/docentes/url/jcn/ie2/0POWCamp...
Cigarettes were the numeraire for all transactions for the sake of efficiency.
Maybe I suppose.
I read the book, though I was pretty familiar with the material already. To me it seemed immediately he adopted a hectoring, moralizing tone that was quite unnecessary and distracting. From the outset, he seemed unable to see past the framework of political power structures, and because of that basically missed the point of modern financial capitalism.