Economic Anthropology: David Graeber Meets the Noise Machine...

…and is annoyed at having his summary of anthropological findings dismissed as "nonsensical":

David Graeber: On the Invention of Money: I mentioned that the standard economic accounts of the emergence of money from barter appears to be wildly wrong. Since this contradicted a position taken by one of the gods of the Austrian pantheon, the 19th century economist Carl Menger, [Robert M.] Murphy apparently felt honor-bound to respond….

I’m simply referring to arguments made in my book, ‘Debt: The First 5000 Years’. In his response, Murphy didn’t even consult the book; in fact he later admitted he was responding at least in part not even to the interview but to an inaccurate summary of my position someone had made in another blog!

We are not, in other words, dealing with a work of scholarship. However, in the blogsphere, the quality or even intention of an argument often doesn’t matter. I have to assume Murphy was aware that all he had to do was to write something—anything really—and claim it rebutted me, and the piece would be instantly snatched up by a right-wing echo chamber, mirrored on half a dozen websites and that followers of those websites would then dutifully begin appearing across the web declaring to everyone willing to listen that my work had been rebutted…

Graeber's summary:

[W]hat anthropologists observe when neighbors do engage in something like exchange with each other, if you want your neighbor's cow, you'd say, "wow, nice cow" and he'd say "you like it? Take it!" — and now you owe him one. Quite often people don't even engage in exchange at all — if they were real Iroquois or other Native Americans, for example, all such things would probably be allocated by women's councils.

So the real question is not how does barter generate some sort of medium of exchange that then becomes money, but rather, how does that broad sense of "I owe you one" turn into a precise system of measurement — that is: money as a unit of account?

By the time the curtain goes up on the historical record in ancient Mesopotamia, around 3200 BC, it's already happened. There's an elaborate system of money of account and complex credit systems. (Money as medium of exchange or as a standardized circulating units of gold, silver, bronze or whatever, only comes much later.)

So really, rather than the standard story — first there's barter, then money, then finally credit comes out of that — if anything its precisely the other way around. Credit and debt comes first, then coinage emerges thousands of years later and then, when you do find "I'll give you twenty chickens for that cow" type of barter systems, it's usually when there used to be cash markets, but for some reason — as in Russia, for example, in 1998 — the currency collapses or disappears.

Indeed. It really looks from the anthropologists that Adam Smith was wrong--that we are not animals that like to "truck, barter, and exchange" with strangers but rather gift-exchange pack animals--that we manufacture social solidarity by gift networks, and those who give the most valuable gifts acquire status hereby.