Economics in the 21st Century

Money. It's a wildly theorized phenomena. It makes trade across commodities and spaces possible. For some theorists, it is merely the grease in the economic wheels. For others, it is a strange phenomena that is both tradeable and facilitates trade. Historically, it arose organically out of pure necessity, but allows those with the power and means to accumulate large quantities. For centuries it was or represented precious metals, but during the late 20th century it became a commodity that arose spontaneously in response to demand. The shift from fixed currencies (like gold) to floating currencies exchanged internationally created a commodity (money) that embodied no labor, basically the trade of a commodity strictly based on the collective belief that it was valuable. While this may not seem important on an everyday level, money still buys groceries and gas, on larger scales the effect is signficant and under theorized.

Let's back up to the idea of embodied labor. As labor produces it produces value in the commodity being produced. That commodity is said to contain dead labor - it embodies the work done by laborers. With fixed currency like gold, the gold embodies that dead labor as it is mined, shipped, and shaped. In contrast, floating currencies embody no labor and only gain their value through the market, in which they are compared to other currencies. The value of our money is only valuable in comparison with the value of other currencies. So, how is this value established?

The value of currency is established based on the perceived productivity or consumptive ability of the nation which that currency represents. Or, more accurately, currency is valued based on the belief in the future productivity or consumptive ability of the respective nation. In other words, the value of a currency is related to that of the credit rating of the country that currency represents. Now, how is money produced spontaneously?

On the nation-state level, money is produced when treasury departments or central banks seek to spur economic growth through stimulus, or printing money. Central banks or treasury use national credit ratings to sell national debt to other nation-states and investors and use those sells to print more money. Basically, they borrow money from one nation to print money in their nation. Money is also printed through consumer and business loans. When an individual or group applies for a loan, they apply against their credit rating and receive an amount deemed appropriate to that credit rating. The money is then created and given to the borrower. Of central importance, is the function of the credit rating in the post-modern economy.

As shown previously, fixed moneys embody dead labor, while floating moneys do not. Floating moneys embody the value of future labor or unborn labor, the ability to produce commodities in the future and thereby repay the created money. Instead of in late capitalism, where money greased the wheels of production, post-modern capitalism prints money as a strategy to open possibilities for the future expansion of capitalist production. The function of opening these possibilities was primarily accomplished by primitive accumulation, or accumulation by force (de-unionization; creation of private property through enclosure of lands, etc). The act of creating money now serves as the primary form of primitive accumulation in post-modern capitalism and labor no longer sells its labor, it borrows its future through its credit rating.

Debt-money ensures that capital has no limit to its expansion and ensures the indentured servitude of the multitude of the world's workers.