The other day I was for some reason reading about the early Egyptian dynasties and – Wikipedia being terribly well organized for these sorts of things – kept going back in time until I struck pre-history. The Egyptians started building monuments a very, very long time ago – call it, oh, six thousand years – and by “monuments” I mean spectacular creations which had to harness the productive output of some ridiculous proportion of society. The thought occurred to me “how much did these cost?” and immediately it dawned on me that they cost nothing. That is to say, the very notion of cost was totally irrelevant to ancient Egyptian despots. It likely didn’t even make any sense; what do you mean, something “costs” a certain amount? Amount of what?
But nevertheless, a ruling class harnassed the resources of the Nile River basin to create immense and wholly useless objects in the valleys off the basin and the near desert plateaus. They were not stores of wealth at all – they could not be exchanged and while they could be raided, they were only subsequently raided by peoples who no longer had any recognizable (to the Egyptians) concepts of value. This is obviously not a capitalist society. It’s a society which stores and conceives of value in some very different way, and which is really lost to us entirely at this point. Was value in land? Was it in rhetoric – which is another way of saying in religious belief, which after all is fundamentally some kind of spoken incantation? Was it in power – but if it was in power, how was it maintained and exercised? We really don’t know, except to say that it wasn’t money.
I also am reading a rather interesting book about the East India Company, The Anarchy by William Dalrymple. He does something rather strange, which whenever he remarks upon the looting of some treasury of South Asia, he first quotes its value in contemporary money – 1780 pound sterling or whatever – and then in footnotes translates that into 2018 equivalents. They are laughable translations, which I suppose is to be expected from a noted historian but nevertheless: Robert Clive returns to England with a fortune of £234,000, quoted as being equivalent to £262 million today. Rubbish, but Dalrymple shouldn’t be expected to understand that. Clive returned to England with a fortune equivalent to roughly 1% of the cost of fighting the American revolutionary wars. Let’s assume England’s war costs were approximately similar as a percent of GDP as America’s adventures in the Middle East over the last couple of decades; we spent $1.6 trillion, roughly. So 1% of that would be $16 billion, or £12 billion (depending on your approximate exchange rate). Clive looted India for far more than a few hundred millions, which wouldn’t even qualify him for a membership in most West End clubs.
So that begs the question: was the world of Clive, of early modern Europe, capitalist – which, by the way, is more or less Dalrymple’s foundational principle in his history of that fascinating private corporation of adventurers, the EIC? No, clearly, it was not. Money was interesting but power, clearly was based on something else – I’ll posit land and tradition, but it is as nebulous to us today as the power base of the Egyptians. Ancient Egypt despotism was based on something, but it wasn’t money. And early modern English power was based on something, but it also wasn’t money.
Today, though, I would argue that we do live in a world in which power is, at least in the liberal West, based on money. We are capitalist in the political sense of the term. Capital and its concentrations drives the ability to exercise power; its diffusion, indeed, is what makes it so, as it can be deployed, and shifted, and destroyed and created and lost and found with rapidity and with elan. The term “capitalism” is apropos for our era for that reason – but what is it to be compared with, as an alternative or as a competitor? That question has been bothering me lately in the current political discourse, especially here in the US where “socialists” are threatening our “capitalist” system, according to both the Sanders and Cruz camps. The avalanche of central bank and fiscal money unleashed in the Covid-19 stimulus programs worldwide also seem to bow at the altar of capitalism, if only in their recognition that “capital” is what makes the world go in the twenty-first century.
Reading some Walter Benjamin recently as an additional stop on this intellectual board game, I’m reminded of the more titanic battles of the early twentieth century between capitalism and communism. But the capitalism of 1930 polemics bears little resemblance to the capitalism of 2021, while the communism of 1930 seems to have more in common with ancient Egyptian despotism than anything modern or even Marxist. So in the midst of all of this swirling contemporary confusion and historical evolution, I’m going to propose a hypothesis here which I think is unusual. I’d like to argue that mankind is in the midst of the endpoint of capitalism as a political system, but that “capitalism” has existed as a political system for only a very limited period of time compared to what we give it credit for. And if we see that narrative as having some core of truth, we’ll may realize something about what will come next – not to say we’ll predict it with precision, but we can maybe see the colour or tone of what’s over the horizon.
First off, let’s go back to Egypt. It seems to be the case that Egypt had no clear concept of exchange value at the base level, but then again, we should remember that it didn’t need it. Think about it: a dematerialised concept of value – that is, money – has utility when you’re in a society with two of at least three operating conditions:
- Lots and lots of people – that is to say, a massive diversification of individual utility and demand functions;
- Lots and lots of potential demands – that is to say, a massive diversification of goods and services which can be offered for consumption or acquisition; and
- Lots and lots of change – that is to say, a rapid turnover of potential demands and potential exogenous sources and sinks for internal production.
Egypt, of course, had really none of those. It had quite a few people, but really, modern day Belgium probably has a larger population. If you stuck Belgium in the middle of the Sahara, with no easy communication or transport to any other country anywhere, it would suddenly seem like a pretty small place. Ancient Egypt also had a limited set of potential demand objects – basically it was a subsistence economy for the individual producer, and even the powerful had almost no knowledge of potential luxury goods to be viewed as objects of ambition. And change, well, didn’t happen; for over two millenia – four times longer than North America has been known to Europeans or Asians – Egypt was essentially self-referential. What possible utility would money have in such a society? Easy: none. So of course it was not capitalist – of course it would not evolve a power allocation process based on an intangible representation of intertemporal value exchange. While we don’t know what it was based on – my guess is some combination of the lazy habitual exercise of intimidation – it was not capitalist.
Let’s move forward a bit: the Roman and South Asian and Chinese empires were also not capitalist. Both started to evolve a concept of the use of an intangible for use in intertemporal value exchange, but both still lived comfortably in the tradition of the lazy habitual exercise of intimidation. Rome, however, gave birth to Christianity, which at least began a process of asking “really? this intimidation crap is sustainable?” And the South Asians had a similar insight in Buddhism, which then spread to China along with a strong Taoist intermingling. Granted, human habits die hard – the lazy habitual exercise of intimidation is straightforward – but the walls were starting to erode. Each area infected by this axial transformation of self-reflection on the bullshit inherent in lazy tradition, however, begins to evolve intangible institutions which allow for alternative power centres. In the West, this largely becomes institutionalised in law – contracts – and eventually in the dematerialisation of the differential power relationships and future potential transfer values inherent in those contracts into a fully dematerialised tradable form – fiat money. In China and Japan most generally, however, it is institutionalised in “knowledge” – not facts and the like, mind you, but Confucian concepts in China, Brahmanism and yogism in India, social codes and artistry everywhere. Maybe “culture” is a better word: it is not money, not by any means, but it is intangible.
As a brief aside: this isn’t intentionally a Global North-centric analysis, but I think it may serve to explain some world-historical trends, for tragic reasons of course but I’ll come back to them. The Eurasian power centres have been moving towards intangible representations of power for two millenia, with varying degrees of speed and momentum. I don’t know enough about African trends pre-colonialism to know whether or in what direction they were moving towards intangible representations of power. In the New World, it was largely irrelevant as to what direction they were moving pre-Columbian era: disease wiped their civilisations out, and any attempts to reestablish a civilised society was constantly attacked and undermined by European expansion and colonial rule. So the trend towards dematerialising power has maintained itself primarily in Eurasia – and the areas where it has successfully and fully displaced other groups, like the Americas and Australasia.
This evolution, though, took a long time, on both sides of Eurasia. To the west, Europeans first detached the notion of simple intimidation into land. If one owned land – which admittedly is a fairly permanent object – then one had power. Ownership was, of course, initially established via intimidation, and it took centuries for that to evolve into the concept of law, but nevertheless, when you think about it, “possessing” land is not really a valid reason to control others and, in an Egyptian concept, make them construct monuments to your future death. But let’s go back to the starting premise: Europe – and China – both are starting to graduate in this era. For China, there are increasingly lots and lots of people, and lots and lots of potential demand sources. For Europe, there are increasingly lots and lots of potential demand sources, and lots and lots of change from exogenous impacts. Both are marching down the road towards a world where dematerialised intertemporal value exchange mechanisms make sense, are scalable and sustainable. Arguably so is Africa – again, I plead ignorance here – but the New World, even if it was moving in the right direction, suddenly loses most of its population just as exogenous impacts and a revolutionary expansion of demand sources suddenly shows up.
So really, the last couple of millenia have been a rapid – rapid on geological and evolutionary biological timescale, not a human lifespan timescale – evolution towards human societies moving away from what I’d call naturalistic expressions of power – based on physical intimidation – and towards intangible expressions of power. Those intangible expressions are not the same in every place at once, but the move towards intangibles seems to be the high level trend, and indeed the trend that has enabled each of the various Eurasian power centres to dominate (admittedly, along with some additional immune response success, likely borne somewhat by item three on my list of foundational causes, exposure to exogenous change).
I think, though, we’re at a somewhat new point. All of my foundational elements have reached an inflection point. Human population has exploded in the last century, far beyond anything envisioned by, say the mid-nineteenth century thinkers who gave birth to many of our philosophical revolutions (evolution, pragmatism, the death of God, insert your preferred anti-traditionalist creed here). We have reached an almost infinite liftoff point in our ability to create new desires, new demands, new potential sinks for human desire. And the world is now completely interconnected, and as we’ve seen, that means that the potential for both self-generated change and our ability to create physical change on the planet have also reached stages of maximum impact. So we’re not dealing any longer with relatively distinct societies having one or two or three factors which might lead us to want to dematerialise power: we have a global, self-contained system which almost demands it, because simple intimidation won’t work without engaging in dematerialised value itself.
So I’m going to throw up a straw man here: money, as we know it, will go away in the next few decades. What will replace it will be some more encompassing notion of value, which encapsulates more of us that – likely – we’re comfortable admitting to today. For example: we don’t really value old people, and yet Covid-19 has exposed that we really, really are terrified of death from uncertain causes. Those two frankly contradictory notions will combine to make access to health care contingent on, not so much money, as a complex mix of stored value (money) and values, and we’ll be fighting possible actual violent battles until we figure out how those interplay effectively. Beauty will be another battle point: the beautiful will be granted a claim on access to resources, but the ugly will push back. The immediate forum will be taxes and economic claims – much as the forum for dispute in early modern Europe was territorial claims and in 8th century China was in poetry and violence – but this will evolve, and over time we will adapt to teach one another a strange dance of factors which determine who wins, who has access to desirable demand goods which will change almost instantaneously, and who has to wait and see if they can evolve or surrender to despair.
What I think is happening, in other words, is an evolution away from capitalism which has nothing to do with today’s political dialogue or New Left hangups about the failure to evolve towards “socialism”. Humanity has been shifting, slowly but inexorably, towards a world of dematerialised expressions of power. The last century has just seen an acceleration of this, due mostly to technology enabling more of us to survive, to allow for the proliferation of our imaginations to create new objects of desire, and to make more of us accessible to one another so as to embrace the whole of the human community and not leave some of us in isolation. Having achieved a completion of the maximisation of these foundations, I’d posit, we’ll evolve an even more nuanced, complex, and further dematerialised expression of how to store and exchange value and power. This isn’t about bitcoin, mind you, or the Chinese Communist concept of “social value”: this is a more diffuse concept which will evolve on its own, which traditional power centres can’t really capture.
In this new world, fashion – as the transformative notion of change – rises to the fore. Past societies evolved money first to deal with lots of people – that is, lots of anonymised transactions – and gold or physical currency made sense there. Adding to it the idea of lots of potential desires, fiat money made more sense – because any commodity that one might choose to be money could potentially become an object of desire itself. But a piece of paper, or a contract, or an electronic blip, would never adhere to desire. Now, though, we add the third element and with almost limit-infinity speed: the potential for desires and people and even exogenous events to change. For that, we need something different, not just fiat money but potentially a value construct which embraces an infinite dynamic.
Ideally, though, we’ll drop the idea of power entirely. I mean really: why try to control in a world where control is still not possible – the world is still not ours, it is still subject to randomness – so isn’t control, which is at the root of power, an absurdity? This next concept of exchange value – and value storage – almost by definition needs to embrace the idea that we have no control over tomorrow’s recognition of importance or meaning. But in the evolution of power functions towards intangibles, I don’t observe any parallel release of control. Indeed, every step seems to be a rearguard action to keep some ownership over that which I have. This strikes me as arch irony: power is dematerialised, it becomes released from physical violence and lazy acceptance, and yet we still foolishly expect that we will control the forces of nature and mankind on the one hand, and lazily succumb to the willful exercise of control by others. Power seems to be persistent, regardless of how absurd it becomes over time.
As an unlovely, relatively unlanded individual who has no wish to manufacture desires in others, yet who remains fascinated about what mysteries remain to be explored, I don’t know where to go from here. In the world of today, I have enough dollars, and pounds, and Loonies, to survive and even prosper. I’m hopeful that going forward, I’ll generate the right currency to pay for the ticket to the other side.