Re: [OPE] Dialectics for the New Century -money

From: Paul Cockshott (
Date: Wed Apr 09 2008 - 11:34:26 EDT

The account you are giving looks to me like laiser faire mythology, with 
money arising spontaneously from
truck barter and exchange. It involves, I think, a back projection of 
bourgeois notions of the economic onto the structures of much more 
ancient and stable civilisations. This is brought out in your opposition 
of economics/politics, where economics corresponds to a world of free 
and voluntary exchange, and politics a superstructure on top of that.

But if one looks at ancient civilisation, this model is inappropriate. 
The state/temple economies were, according to Polanyi,
redistributive economies, where the dominant movements of goods were 

It does not, in such a society, make sense to oppose politics to 
economics in the way you do, since the state/temple system
regulated the flow of a large part of the product. Were the temples with 
their storehouses then economic or political

There is dispute by historians as to whether money existed in 
Mesopotamian society, and it depends on what
one takes to be the distinguishing features of money. These societies 
had a universal unit of account, in the
shekel of barley - a volumetric measure. But it was a unit of account in 
a litteral sense, since these
were literate and numerate societies with durable systems of records. 
Shekels were accounting units in which
obligations to deliver crops to the temple and royal warehouses were 
measured. A delivery could be
made in dates or some other crop rather than barley, subject to official 
published rates of equivalence.

Such rates of equivalence would not be arbitrary any more than market 
prices are arbitrary. Both have
a common underlying cause in the varying amounts of labour required to 
produce different crops.

The objection to the idea that barley was a 'money commodity' in your 
sense, rather than a unit of
account, is that a circulation of the form C-M-C would not generally 
take place. A farmer would not
sell dates for barley which would in turn be sold for sheep. Instead the 
farmer would have a tax obligation
in terms of barley, for which he could proffer dates, honey, flax etc, 
as alternatives.
These tax obligations would be written in record tablets, and the 
meeting of the obligations
likewise. If the calculations were all done in shekels, that does not 
mean that a physical
stock of barley moved about, only that marks on clay tablets used that 
as their unit.

We are talking here about an economic model that lasted for thousands of 
years, and within
which the greater part of the flows of goods did not take the form of 
commodity exchange. This system
had an internal need for a scale of equivalences which was distinct from 
the need that
arises in commodity producing society. It is unrealistic to have the 
tail of foreign trade wagging
the dog.

If one looks at Homeric Greece, cattle are a common unit of account, or 
measure of wealth but that does not indicate
that cattle were actually used as money. They may constitute brideprice 
or the units in which blood debts
are settled, but for a sea-going people, they hardly made a convienient 
trading currency.

Money in the modern sense of tokens having an independent physical 
existence come into existence
with the dawn of classical Greece, paralleling the establishment of city 
states. The problems that
the commodity money theory has here are

1. To account for the fact that these coins were initially of far to 
high a denomination to be practical
   for daily trade - whereas they were practical to meet an annual tax 
debt for instance.
2. To account for the fact that they had from the outset a fiduciary 
character, and typically
   circulated above their intrinsic worth.

paul bullock wrote:
> By posing the question this way you are asking if the regular use of a 
> money commodity could exist WITHOUT  some social and political 
> structure. Thus you imply not only that societies had to be political 
> before the evolution of money, but that  - wrongly - politics per se 
> provides an  explanation for the nature of the money commodity.
> Whilst it is possible to imagine a certain level of 'accidental' , 
> spontaneous and coincidental  use of the most convenient commodities 
> as money commodities (plural) in very poorly developed  societies, the 
> reality is that the two processes go together, and money first evolves 
> at the margin of  early society. So your question disguises the real  
> need to find a money commodity to overcome the contradictory nature of 
> the traded good ( that it is, without the money commodity any 
> commodity  is both a use value and a money commodity). The early role 
> of the state was simply to prevent abuse and cheating with the 
> commonly used money because the money commodity  had ALREADY achieved 
> social validity.
> Later on the forced circulation of paper money, the use of the 'state' 
> stamp, arose because of the desire to promote commodity exchange and 
> so that the state could more easily gather in surpluses. BUT this 
> doesn't explain why the money commodity exists.
> paul b.
> ----- Original Message ----- From: "Paul Cockshott" <>
> To: "Outline on Political Economy mailing list" <>
> Sent: Tuesday, April 08, 2008 11:51 PM
> Subject: RE: [OPE] Dialectics for the New Century
> That is not quite the question.
> The question is whether commodity exchange alone without the state 
> ever gave rise to money.
> Paul Cockshott
> Dept of Computing Science
> University of Glasgow
> +44 141 330 1629
> -----Original Message-----
> From: on behalf of paul bullock
> Sent: Tue 4/8/2008 1:04 PM
> To: Outline on Political Economy mailing list
> Subject: Re: [OPE] Dialectics for the New Century
> Dave,
> I know of no evidence that money was issued by any state in the 
> absence of
> some form of commodity exchange.
> Paul
> ----- Original Message ----- From: "Dave Zachariah" <>
> To: "Outline on Political Economy mailing list" <>
> Sent: Saturday, April 05, 2008 9:26 AM
> Subject: Re: [OPE] Dialectics for the New Century
>> on 2008-04-05 00:16 paul bullock wrote:
>>> Marx demonstrated through a dialectical method, why money came into
>>> existence and what it represented. Then he demonstrated why a 
>>> concept of
>>> price at one stage in the development of commodity production had to 
>>> give
>>> weay to another concept ie 'simple price' to 'price of production'. 
>>> Here
>>> I use the term concept as an idea that actually properly grasps a real
>>> process.
>> Paul, I think you need to be careful with the word 'demonstrated' here.
>> You can demonstrate logically, i.e. deduce certain consequences, and you
>> can demonstrate things empirically. They are not the same thing. It does
>> not matter if the logical demonstration was consistent and elegant, 
>> if it
>> is contradicted by empirical evidence one discards the theory in the
>> search for a better one.
>> Marx deduced the origin of money, but it is a prediction that lacks
>> empirical support. Money did not emerge from commodity production but 
>> from
>> pre-capitalist states.
>>> (Incidentally since Marx died when my own grandfather was already 16, I
>>> feel you should play down the 'too many years ago' bit as if it were an
>>> argument ;-)
>> It was just a reminder that Karl Marx was a human being in a long 
>> line of
>> great thinkers but with knowledge and concepts conditioned by the
>> historical circumstances of his day. If you put Marx at par with other
>> great thinkers of that century, such as Darwin and Maxwell and 
>> compare how
>> their scientific theories were refined with time as empirical evidence
>> accumulated and new theoretical concepts were introduced, then you will
>> have a sober reading of Marx, the social scientist.
>> //Dave Z
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