Debt: The First 5,000 Years

by David Graeber

Money, then, had passed from a measure of honor to a measure of everything that honor was not. To suggest that a man’s honor could be bought with money became a terrible insult—this despite the fact that, since men were often taken in war or even by bandits or pirates and held for ransom, they often did go through dramas of bondage and redemption not unlike those experienced by so many Middle Eastern women.

A warrior’s honor is his willingness to play a game on which he stakes everything. His grandeur is directly proportional to how far he can fall.

Since money could be used to buy just about anything, everyone desired it. That is: it was desirable because it was non-discriminating. One could see how the metaphor of the porne might seem particularly appropriate. A woman “common to the people”—as the poet Archilochos put it—is available to everyone. In principle, we shouldn’t be attracted to such an undiscriminating creature. In fact, of course, we are.68 And nothing was both so undiscriminating, and so desirable, as money.

We might say, then, that money introduced a democratization of desire. Insofar as everyone wanted money, everyone, high and low, was pursuing the same promiscuous substance. But even more: increasingly, they did not just want money. They needed it. This was a profound change. In the Homeric world, as in most human economies, we hear almost no discussion of those things considered necessary to human life (food, shelter, clothing) because it is simply assumed that everybody has them. A man with no possessions could, at the very least, become a retainer in some rich man’s household. Even slaves had enough to eat.70

This extreme fear of dependency on others’ whims lies at the basis of the Greek obsession with the self-sufficient household.

Even more dramatically, it was ordinarily male citizens who accused one another of prostitution—with Athenian politicians regularly asserting that their rivals, when they were young boys being plied with gifts from their male suitors, were really trading sex for money, and hence deserved to lose their civic freedoms.

What we see above all is the erosion both of older forms of hierarchy—the Homeric world of great men with their retainers—and, at the same time, of older forms of mutual aid, with communistic relations increasingly being confined to the interior of the household.

On the one hand, a loan implies no ongoing responsibilities on the part of the creditor. On the other, as I have continually emphasized, a loan does assume a certain formal, legal equality between contractor and contractee. It assumes that they are, at least in some ways and on some level, fundamentally the same kind of person.

The same tensions can be observed between neighbors, who in farming communities tend to give, lend, and borrow things amongst themselves—anything from sieves and sickles to charcoal and cooking oil, to seed corn or oxen for plowing. On the one hand, such giving and lending were considered essential parts of the basic fabric of human sociability in farm communities, on the other, overly demanding neighbors were a notorious irritant—one that could only have grown worse when all parties are aware of precisely how much it would have cost to buy or rent the same items that were being given away.

With the appearance of money, it could also become unclear what was a gift and what was a loan. On the one hand, even with gifts, it was always considered best to return something slightly better than one had received.78 On the other hand, friends do not charge one another interest, and any suggestion that they might was sure to rankle. So what’s the difference between a generous return gift and an interest payment?

Honor is the same as credit; it’s one’s ability to keep one’s promises, but also, in the case of a wrong, to “get even.” As the last phrase implies, it was a monetary logic, but money, or anyway a money-like relation, is confined to this. Gradually, subtly, without anyone completely understanding the full implications of what was happening, what had been the essence of moral relations turned into the means for every sort of dishonest stratagem.

Nicostratus appears to have concluded that it was more honorable, or anyway more bearable, to try to extract the money from his lowly friend through force and fraud than to spend the rest of his life feeling beholden.

The story has everything. We see mutual aid: the communism of the prosperous, the expectation that if the need is great enough, or the cost manageable enough, friends and neighbors will help one another.81 And most did, in fact, have circles of people who would pool money if a crisis did arise: whether a wedding, a famine, or a ransom.

While everyday market transactions, at shops or stalls in the agora, were here as elsewhere typically conducted on credit, the mass production of coinage permitted a degree of anonymity for transactions that, in a pure credit regime, simply could not exist.83 Pirates and kidnappers do business in cash—yet the loan sharks at Aegina’s marketplace could not have operated without them.

what was one to make of the fact that money, that very thing that seemed capable of turning morality into an exact and quantifiable science, also seemed to encourage the very worst sorts of behavior?

clearly, his father hadn’t meant “debt” in the literal sense of returning what one has borrowed. He meant it more in the sense of giving people what is owed to them; repaying good with good and evil with evil; helping one’s friends and hurting one’s enemies. Demolishing this one takes a little more work (Are we saying justice plays no part in determining who one’s friends and enemies are? If so, wouldn’t someone who decided he had no friends, and therefore tried to hurt everyone, be a just man? And even if you did have some way to say for certain that one’s enemy really is an intrinsically bad person and deserves harm, by harming him, do you not thus make him worse? Can turning bad people into even worse people really be an example of justice?), but it is eventually accomplished.

The art of medicine aims to improve health, whether or not doctors get paid for practicing it. The art of shepherding aims to ensure the well-being of sheep, whether or not the shepherd (or his employer) is also a businessman who knows how to extract a profit from them. Just so with the art of governance. If such an art exists, it must have its own intrinsic aim apart from any profit one might also get from it, and what can this be other than the establishment of social justice?

It’s only the existence of money, Socrates suggests, that allows us to imagine that words like “power” and “interest” refer to universal realities that can be pursued in their own right, let alone that all pursuits are really ultimately the pursuit of power, advantage, or self-interest.87

Clearly, then, property is not really a relation between a person and a thing. It’s an understanding or arrangement between people concerning things.

The only thing “absolute” about my rights to a chainsaw is my right to prevent anyone else from using it.92

One can imagine property not as a relation between people, but as a relation between a person and a thing, if one’s starting point is a relation between two people, one of whom is also a thing. (This is how slaves were defined in Roman law: they were people who were also a res, a thing.)95 The emphasis on absolute power begins to make sense as well.96

In other words, the master cannot claim civil damages against the ballplayers or barber for destroying his property if the real problem was that he bought a stupid slave.

In creating a notion of dominium, then, and thus creating the modern principle of absolute private property, what Roman jurists were doing first of all was taking a principle of domestic authority, of absolute power over people, defining some of those people (slaves) as things, and then extending the logic that originally applied to slaves to geese, chariots, barns, jewelry boxes, and so forth—that is, to every other sort of thing that the law had anything to do with.

the Roman elite eventually figured out the principle that most successful Mediterranean elites learned: that a free peasantry means a more effective army, and that conquering armies can provide war captives who can do anything debt bondsmen used to do, and therefore, a social compromise—allowing limited popular representation, banning debt slavery, channeling some of the fruits of empire into social-welfare payments—was actually in their interest.

whereby—since liberty meant nothing outside of membership in a community—that slave automatically became a Roman citizen. This led to some very peculiar arrangements. In the first century AD, for example, it was not uncommon for educated Greeks to have themselves sold into slavery to some wealthy Roman in need of a secretary, entrust the money to a close friend or family member, and then, after a certain interval, buy themselves back, thus obtaining Roman citizenship. This despite the fact that, during such time as they were slaves, if their owner decided to, say, cut one of his secretary’s feet off, legally, he would have been perfectly free to do so.109

(“to be the object of anal penetration is a crime in the freeborn, a necessity for a slave, a duty for a freedman”).110 What is significant here is that sexual subservience is considered the “duty” only of the freedman. It is not considered the “duty” of a slave. This is because, again, slavery was not a moral relation. The master could do what he liked, and there was nothing the slave could do about it.

As everywhere in the ancient world, to be “free” meant, first and foremost, not to be a slave. Since slavery means above all the annihilation of social ties and the ability to form them, freedom meant the capacity to make and maintain moral commitments to others.

The English word “free,” for instance, is derived from a German root meaning “friend,” since to be free meant to be able to make friends, to keep promises, to live within a community of equals. This is why freed slaves in Rome became citizens: to be free, by definition, meant to be anchored in a civic community, with all the rights and responsibilities that this entailed.111

After all, even slaves are free to do absolutely anything they’re actually permitted to do. To say a slave is free (except insofar as he isn’t) is a bit like saying the earth is square (except insofar as it is round), or that the sun is blue (except insofar as it is yellow), or, again, that we have an absolute right to do anything we wish with our chainsaw (except those things that we can’t).

If freedom is natural, then surely slavery is unnatural, but if freedom and slavery are just matters of degree, then, logically, would not all restrictions on freedom be to some degree unnatural? Would not that imply that society, social rules, in fact even property rights, are unnatural as well?

Originally, human beings lived in a state of nature where all things were held in common; it was war that first divided up the world, and the resultant “law of nations,” the common usages of mankind that regulate such matters as conquest, slavery, treaties, and borders, that was first responsible for inequalities of property as well.114

This in turn meant that there was no intrinsic difference between private property and political power—at least, insofar as that power was based in violence.

in ordinary church Latin of the time, it had come to be used equally for “lordship” and “private property.” Medieval jurists spent a great deal of time and argument establishing whether there was indeed a difference between the two. It was a particularly thorny problem because, if property rights really were, as the Digest insisted, a form of absolute power, it was very difficult to see how anyone could have it but a king—or even, for certain jurists, God.117

This is a tradition that assumes that liberty is essentially the right to do what one likes with one’s own property. In fact, not only does it make property a right, it treats rights themselves as a form of property. In a way, this is the greatest paradox of all.

In fact (as Medieval jurists were well aware), one man’s right is simply another’s obligation. My right to free speech is others’ obligation not to punish me for speaking; my right to a trial by a jury of my peers is the responsibility of others to maintain a system of jury duty. The problem is just the same as it was with property rights: when we are talking about obligations owed by everyone in the entire world, it’s difficult to think about it that way.

one man’s right is simply another’s obligation.

“For a Gersonian, liberty was property and could be exchanged in the same way and in the same terms as any other property”—sold, swapped, loaned, or otherwise voluntarily surrendered.119 It followed that there could be nothing intrinsically wrong with, say, debt peonage, or even slavery. And this is exactly what natural-rights theorists came to assert.

Government was essentially a contract, a kind of business arrangement, whereby citizens had voluntarily given up some of their natural liberties to the sovereign. Finally, similar ideas have become the basis of that most basic, dominant institution of our present economic life: wage labor, which is, effectively, the renting of our freedom in the same way that slavery can be conceived as its sale.121

To say that we own ourselves is, oddly enough, to cast ourselves as both master and slave simultaneously. “We” are both owners (exerting absolute power over our property), and yet somehow, at the same time, the things being owned (being the object of absolute power).

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The most popular solution—to say that each of us has something called a “mind” and that this is completely separate from something else, which we can call “the body,” and that the first thing holds natural dominion over the second—flies in the face of just about everything we now know about cognitive science.

we seem to be trapped between imagining society in the Adam Smith mode, as a collection of individuals whose only significant relations are with their own possessions, happily bartering one thing for another for the sake of mutual convenience, with debt almost entirely abolished from the picture, and a vision in which debt is everything, the very substance of all human relations—which, of course, leaves everyone with the uncomfortable sense that human relations are somehow an intrinsically tawdry business, that our very responsibilities to one another are already somehow necessarily based in sin and crime. It’s not an appealing set of alternatives.

This is why I developed the concept of human economies: ones in which what is considered really important about human beings is the fact that they are each a unique nexus of relations with others—therefore, that no one could ever be considered exactly equivalent to anything or anyone else. In a human economy, money is not a way of buying or trading human beings, but a way of expressing just how much one cannot do so.

it is only by the threat of sticks, ropes, spears, and guns that one can tear people out of those endlessly complicated webs of relationship with others (sisters, friends, rivals …) that render them unique, and thus reduce them to something that can be traded.

All of this, it is important to emphasize, can happen in places where markets in ordinary, everyday goods—clothing, tools, foodstuffs—do not even exist. In fact, in most human economies, one’s most important possessions could never be bought and sold for the same reasons that people can’t: they are unique objects, caught up in a web of relationships with human beings.124

In heroic societies, the role of violence is not hidden—it’s glorified. Often, it can form the basis of one’s most intimate relations. In the Iliad, Achilles sees nothing shameful in his relation with his slave-girl, Briseis, whose husband and brothers he killed; he refers to her as his “prize of honor,” but almost in the very same breath, he also insists that, just any decent man must love and care for his household dependents, “so I from my heart loved this one, even though I won her with my spear.”127

Kings surround themselves with slaves for the same reason that they surround themselves with eunuchs: because the slaves and criminals have no families or friends, no possibility of other loyalties—or at least, in principle, they shouldn’t. But, in a way, kings should really be like that too. As many an African proverb emphasizes: a proper king has no relatives either, or at least, he acts as if he does not.128 In other words, king and slave are mirror images, in that unlike normal human beings who are defined by their commitments to others, they are defined only by relations of power. They are as close to perfectly isolated, alienated beings as one can possibly become.

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At this point, we can finally see what’s really at stake in our peculiar habit of defining ourselves simultaneously as master and slave, reduplicating the most brutal aspects of the ancient household in our very concept of ourselves, as masters of our freedoms, or as owners of our very selves. It is the only way that we can imagine ourselves as completely isolated beings.

Most of our most precious rights and freedoms are a series of exceptions to an overall moral and legal framework that suggests we shouldn’t really have them in the first place.

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It is one of the great ironies of history that modern racism—probably the single greatest evil of our last two centuries—had to be invented largely because Europeans continued to refuse to listen to the arguments of the intellectuals and jurists and did not accept that anyone they believed to be a full and equal human being could ever be justifiably enslaved.

If we look at Eurasian history over the course of the last five thousand years, what we see is a broad alternation between periods dominated by credit money and periods in which gold and silver come to dominate—that is, those during which at least a large share of transactions were conducted with pieces of valuable metal being passed from hand to hand.