Sean Meriwether's Reviews > Debt: The First 5,000 Years

Debt by David Graeber
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bookshelves: ecomomics, history

It would be impossible to sum up this tome in a few paragraphs; Graeber’s history of money (not just the debt in the title) is a comprehensive and thoroughly-researched book.

The first half poses a question about our modern interpretation of debt, for instance how society has linked indebtedness to poor morals or as a social failing. He traces the origins of the economy, and the shifting concepts of credit and debt, back to its roots for an answer. He disputes the widely held belief that the early economy was a one-to-one barter exchange (where I have something you want and you have something I want of a similar value), and replaces it with a more nuanced system of credit (where you have something I want and I will accrue a debt until I pay you off in an agreed upon method, or my debt to you is passed on to someone else who has something you want). The economy as we know it today shifted from the credit relationship between buyers and sellers who knew each other to include different types of currency (including coinage, people, written IUOs, and notched tokens), when the trading parties were strangers and less trusting. Currency has a notional value determined by the ruling party, or between trading partners, in the same way that they we can have the same understanding of a definition of a word. To this end, whatever might be understood as currency can be used to "translate" value between dissimilar things, and expedite the transaction, similar to the way a currency may be pegged to the value of the US dollar, or the irrational value placed on BitCoin.

The second half of the book traces the history of the economy from its early foundations of a credit-based economy, through centuries of warfare in which coinage grew in popularity. History shows that in times of turbulence, particularly when armies are tasked with invading their enemies for spoils, that coinage facilitates diving up the loot; Graeber also argues that coinage may have originated with the need to pay soldiers who were plundering their enemies, and then grew outward with travelling merchants moving from port to port. In times of peace, where there is more trust between parties, credit is more commonly used. He traces the origins of three of the major religions and their influence on the economy, slavery, usury (charging excessive interest on loans), and the exploration and exploitation of the world; they are all inexorably intertwined. Nowhere does this intersection have more transparency than in Cortes’s devastation of Latin America, in which untold numbers of indigenous people were enslaved, exploited, tortured, and exterminated in the ceaseless drive to extract silver, which fed the Spanish economy as it traded with China for exotic goods. The modern interpretation of debt can also be ruinous, as those with money can hold power over those without by keeping them financially subjugated.

Graeber backs up his ideas with documentation from the periods he is discussing, and for the math-wary, very little equations, and credits Islam for origin of many of our financial arrangements, which were adopted during the Crusades. I turn to a Dickens' character to sum up one part of his economic theory, John Wemmick from Great Expectations Great Expectations underscored the value of portable property when dealing with an uncertain future.
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Reading Progress

December 5, 2011 – Shelved
December 5, 2011 – Shelved as: ecomomics
February 12, 2019 – Started Reading
August 9, 2019 – Shelved as: history
August 9, 2019 – Finished Reading

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