How Credit-Money Shapes the Economy: The United States in a Global System

This is a book about money. If you expect to find advice in these pages about the safest or quickest routes to wealth, however, you will be disappointed. All I can say about those how-to-get-rich books, especially the best-sellers among them, is that their authors have found a quick way to riches themselves. Their sales confirm that a great many people want to be told how to "make money." I am more interested in the "why" than in the "how to." Why are we so obsessed with getting rich? What is it about money that makes it so attractive?

Apart from the most basic human emotions of love and fear, there is probably no more powerful motivating force in our lives than money. Its attraction stems from an ironic combination of exclusivity and omnipresence. Money is the only means through which we may lawfully gain access to goods, services, and assets. This monopoly position as the one socially accepted representative of income gives its owners command in the marketplace, power, and social status. We all need a minimum of it and want a maximum of it. There is enough money around for many of us to be well off but never enough for all of us to live comfortably. In that setting of relative deprivation, we are all forced to pursue its acquisition in competition with each other. To the extent that we expend our income, we are continuously forced to repeat the pursuit.

Given that we spend most of our days earning income and spending it, we tend to take the role of money as "the only thing that counts" for granted. We learn early on that having money is prerequisite to satisfying most of our needs and desires. Soon we internalize its representation and stop questioning its existence. At that point we easily forget that money is not a natural but a human construct, something we created and refined to regulate a wide range of interactions among ourselves. We use it to price goods and services, to pay for them, to acquire assets that produce even more income, and to settle debts. All of these activities are essential to the proper functioning of our economic system.

Most economists understand these functions of money only in a purely descriptive manner. They approach the object as if it were a good, with its own

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