Reviewed by: Frank Trentmann
Author: Felix Martin
Publisher: Bodley Head
Price (RRP): £20
Money is a funny old thing. “Money, money, money,” ABBA mused, “must be funny, in the rich man’s world.” But what exactly is this thing that seduces some yet mobilises others to occupy financial centres in protest against the super-rich? Felix Martin should know – after all, he is a bond investor. He demonstrates a capacity both for wit and literary style in this engaging, timely history.
It is a story of progress followed by fog and confusion. Money was a creature of standardisation and trust, literacy and numeracy. Mesopotamian Uruk was where a new mode of book-keeping was born. Instead of putting clay tokens in a box to keep track of someone’s obligations, symbols were entered on a tablet with a reed pen. All that was now needed was a metric unit so that money stood for the same value in different places. Essentially, money was a clever way to keep track of credit and debt. It is quite wrong, Martin stresses, to think of it as a lot of coins used for exchange, as if they had a fixed value.
Ironically, it is from the 17th century, the ‘age of enlightenment,’ that the fog of fallacy started to spread. Martin pins the main burden on John Locke who, in the 1690s, opposed the recoinage and a more flexible view of value. Locke’s concerns were political. After demolishing the philosophical basis of absolute monarchy, he had no interest in letting a sovereign play with money.
For Martin, these are not historical anecdotes. They continue to cast a shadow over the present, blinding us to what money really is: a flexible technology that exists to serve society, rather than a fixed standard telling it what to do. It is not good enough to attack the rich. The true idea of money needs to be restored.
This is a compelling narrative. If there is one weakness, it is the presumed link between the idea of money and the social life of money. Locke’s ideas are given too much weight: authorities in the rest of the world were hardly won over by his liberal ideas. In England, most people continued to practise the ‘right’ idea of money, whatever Locke thought. Credit and debt held communities together, not least because there were few coins to go around.
Modern history is full of competing cultures of money. Some, such as the Victorian co-operatives, favoured cash, while others praised credit. It is a pity that Martin loses interest in anthropology once the book hits the modern world.
For many protesters today, money, banks and bonuses are one and the same. Martin makes a forceful case for money’s social virtue. It remains to be seen whether setting bad ideas right will be enough to lead us out of the current mess, but it is at least a step in the right direction.
Frank Trentmann is the author of Free Trade Nation (Oxford University Press, 2009)