Money: The Unauthorized Biography by Felix Martin

Rating: ★★★

Money: The Unauthorized Biography, Felix Martin emphasizes that money is a social technology, and that it's counterproductive to treat it as some kind of scientific phenomenon. I think I would have gotten more out of this book if I hadn't read Debt by David Graeber only a few months earlier. Debt is a more detailed account of the emergence of money than Money is, and Graeber is better equipped to write about social dynamics.

Still, there are some great historical examples in this book. The 1970 bank shutdown in Ireland and subsequent community workarounds and the laissez-faire justifications for witholding aid during the Great Famine in Ireland were both totally new to me.

Here are some of the ideas I found most interesting:

John Locke and the folly of "naturalness"

Locke said that rights exist by nature, so he reasoned that the theory of money had to be altered to also be somehow natural and scientific. He said that money should be a pure measurement of previous metal.

"Locke's understanding of money led not to a new age of objectivity in economic affairs" but to arbitrary prejudices with their tracks covered with "a veil of apparent scientific objectivity"

Locke's understanding of money paved the way for economics claiming to reduce "moral and political justice to the mechanical application of objective scientific truths"

Banks and trust

Bankers needed to trust each other a lot to operate a private money network, but they had no force to threaten each other with. This means that they had to operate like an exclusive club and select who they did business with very carefully. One way to make this selection is by choosing business partners who share your religious background. Surprisingly to me, many of the largest banks in England in the 19th century were controlled by Quakers!