Why does money exist?
What is capitalism? and what do the various forms of currency really represent?
And what would we do if there were no coins or dollar bills?
I’ve seen a lot of people arguing recently, caught in a swell of hatred triggered by this year’s US presidential election.
Otherwise reasonable or even mild mannered people taking on the persona of a medieval crusader off to slaughter the “infidels”; there blood soaked armor eternally self justified by feelings of righteous indignation.
And it seems to me that this disgusting landscape painted with bodies of those wounded by spiteful lashings from there friends and families is centered around money related issues ever so ethereal as the word “economy”.
I feel compelled to attempt dispelling a few of the rumors and misconceptions about money by explaining what exactly it is and it’s intended purpose, poor as I am in both knowledge and writing prowess.
When you add value to the life of another person either by preforming for them a service or providing to them a thing or “product” (a thing that is a product of labor, craftsmanship or manufacturing) then they naturally are grateful as any sane person would be and recognize that you are worthy of receiving something in return.
However, because in this day in age we are all of us very specialized in our chosen professions they may not have something that can be agreed upon as of equal value to that which we have given them and also meets or wants or needs.
And if we wish to receive the fruits of our goodwill from another person who can offer goods or services that better meet our needs or desires then we would have to get the person we our selves served to vouch for us that we have indeed provided value to there life and thus deserve there services on merit of our effort for there benefit.
This whole interaction becomes very messy when bartered through third parties via word of mouth. And humanity has taken to the practice of using currency as a means of quantifying the value that one adds to the life of another with there goods or services.
This is then tendered as proof of merit for receiving the effort of others; in other words the money I give you for your services is proof that I deserve them because I have myself served someone else. It is merely a quantification of the value or goodwill that you have given to others.
THE most common misconception I have heard on the subject of money is that you deserve to be compensated in proportion your investment of time and/or effort.
THIS IS FALSE.
Remember the thing money represents? The amount of value you have added to the life of another person. If you work very hard to provide only a little value to there life then you do not deserve very much compensation.
This system rewards serving others, providing them with the maximum amount of value with the least amount of effort, not working hard in and of itself. It isn’t about you, how long or how hard you work; it is about serving others.
A brain surgeon makes a lot of money because he saves peoples lives, gives fathers, mothers, sons and daughters back to there families. And with every effort made to avoid debilitating brain damage. That is a lot of value!
Made all the more valuable because the skill and expertise required to preform brain surgery is quite rare due primarily to the difficult of the training and education. Don’t give me some crap line about how everyone would be a brain surgeon if med school were cheap, that stuff is difficult. =P
By comparison the work of a cashier or burger flipper offers little value to the lives of others, usually an unhealthy mediocre tasting meal or simply enabling a purchase with a few simple motions. The value that these jobs offer to a group of people serving others corporately is small, and the pay is rightly proportionate to the impact of there contribution.
I offer no education in economics to back up my beliefs or understanding, only my own plain and simple reason has brought me to the conclusion that “compensation proportionate to the value you provide to others” is the ideal that defines the un-perverted spirit of capitalism.
My next post will address how these principles are to be applied when a group of people are serving others cooperatively (a.k.a corporately, a.k.a. as part of a corporation). Please hold all counter arguments about rich CEOs until after that one. xD