A Perspective on Money

The "Great Recession" has brought critics of money out of the woodwork. The claim that "money is the root of all evil" has become more prevalent. Many decry the wealth of the "1%" and the needless hoarding of money when their are others that have a true 'need' that outweighs the opulent desires of the capitalist class. The ideas of "fair share" and "economic justice" are being screamed by the left and even now the right.

The first thing about the "money is the root of all evil" claim is that it is wrong. Money, or currency, is an inanimate object. It has no more power to be evil than a rock or an empty bottle. People can be evil, people can use money for evil, like they can a rock or a gun. That is, money is simply a tool, like a hammer. It facilitates transactions, as a representative for the goods and services a person can provide. Before money people bartered. A man, skilled at agriculture, traded corn for the products of a blacksmith, skilled at metalwork. Today, instead of finding a person who both desires what we can provide and can provide what we desire, we use money as a representative of our productive ability. We only need to find someone who desires what we can provide, they trade you money in exchange for your abilities. Then we can trade that money to a third person for their production. And the cycle continues on and on.

Some people have productive ability that is rarer or in higher demand than others. Doctors, lawyers, and other specialist professions earn more money because there are less of them and a higher desire for their services.

A criticism of the "1%" is that they do no productive work. Their wealth derives from owned assets, stocks, bonds, dividends, and interest. They've never had to work an assembly line or risk their lives on patrol. Why should they be so much more wealthy when there are so many others out there that have done more for society like soldiers, teachers, or even administrative assistants?

What the 1% does however, is so important to this society that removing their property would cause our standard of living, that is of the 100%, to crumble. The capitalist class takes risk with their property. Private equity, such as that of Mitt Romney's Bain Capital, provides financial backing to people who would otherwise be unable to trade their productive ability. Remember always, that a corporation is simply a group of people. Without financial capital, raised through bonds or public offerings, people would no longer be able to produce at a scale large enough to provide the goods and services to maintain any form of post-Renaissance standard of living.

The greatest thing about our economic system is that the method of wealth accumulation is simple: Consume less than you produce. Produce as much as you desire to earn. If you think someone is undeserving of the wealth they have, prove it. Convince them to trade you their money for your production. Invest your money better, finance a start-up or purchase corporate bonds. You will become an integral part of the system and make lives better.