Currencies of Daily Life

SLIDE “Money is the god of this world,” the young Engels wrote; “the bourgeois takes the proletarian’s money from him and so makes a practical atheist of him.” (MECW 4:412) The marxist theory of money usually begins with Marx’s account of the social origins of money. In this part of our presentation, I will begin instead with Engels’ account of the cultural effects of money. BLANK SLIDE
For Engels, the worship of money is a bourgeois affliction.  “The working-man…knows nothing of this feeling of reverence for money [and] is therefore less grasping than the bourgeois…who sees in the accumulations of his money-bags the end and aim of life.” Though Engels writes of the world of small change—farthings and ha’pennies—and of the struggle to insist on money wages rather than company scrip—the “truck system”—he argues that working people want money for what it buys, not as an end in itself. Working people are financial atheists, with no faith in savings banks or government bonds. To this day, professors of finance lament the economic illiteracy of ordinary people, their lack of interest in interest. However, like other confident assertions of working class “atheism” by the young Marx and Engels, the notion that ordinary people would remain immune to the seductions of money now seems wishful. Just as labor historians have rethought the “withering away” of working-class religion and nationalism, so they have been driven to reconsider the cultural effects of money.
There are two distinct traditions of thought regarding the cultural effects of money. One insists that money reduces human relations to the cash nexus. The monetization of social relations homogenizes and quantifies every aspect of life. Its social meaning is to erase social meaning; SLIDE the psychologist Daniel Kahneman argues that the very “idea of money primes individualism: a reluctance to be involved with others, to depend on others, or to accept demands from others.” (55-6) BLANK SLIDE The other tradition insists that money creates a wealth of social meanings. We don’t live amidst a single undifferentiated money but among many monies: gift monies and death monies. Moreover, national and transnational currencies are a “minimalist media” (Fornas, 9) that create peculiar symbolic universes: it’s all about the Benjamins. Since Marx’s critique of what he called the “religion of everyday life” highlighted both reification and fetishism, marxist analyses tend to draw from both traditions: if money is an instance of reification, the quantification of all qualities, it is less an invisible hand or a hidden god, than an animated superhero.
If the absence of money in early industrial cities created Engels’s monetary atheists—he cites teenagers who don’t know who Jesus is nor how many farthings make up two pence—this changes when, as David Graeber puts it, “coins and paper money were…produced in sufficient quantities that even ordinary people could conduct their daily lives without appeal to tickets, tokens,” or tally sticks (354). Two moments emerge in this history. In the era of Fordism, working class households came to depend on cheap goods purchased with cash wages: the nickel loaf of bread, the dime novel, and the nickelodeon, their  names taken from small change. The “family dollar” was not an abstract universal equivalent but a locus of contested meanings. What SLIDE Viviana Zelizer calls “domestic money” and Susan Porter Benson calls “household accounts” became the site of struggle over distribution—the housewife’s “pin money,” the workingman’s “pocket money,” children’s “allowances”—and the way money was “earmarked” (Zelizer’s term): “tin can money,” “cash stashes,” “treats.” SLIDE Labor apparatuses began investigating “household budgets” to reform working-class spending.
This working-class Fordism has been transformed over the last half century. SLIDE “The most striking aspect of financialization is the penetration of financial transactions into the circuits of personal revenue,” writes Costas Lapavitsas  (238). Earlier financial profit was based on loaning capital to merchants and manufacturers; now it depends on what he calls “financial expropriation”: the financialization of privatized housing, health and retirement, and the fees extracted from everyday transactions by payment processors.   
This SLIDE “financialization of daily life,” as the late Randy Martin called it, produced the prosaic currencies behind the exotic derivatives: credit cards, home equity loans, 401(k)s, and subprime mortgages. Indeed, as Lapavitsas argues, “the historic crisis that commenced in 2007 was triggered by the poorest layers of the U.S. working class defaulting on mortgage debt” (276). The “practical atheism” of today’s working class took the form of a mortgage strike.  BLANK SLIDE
Oddly, in this new world, there is no evidence that digital currency is replacing cash. The rise in debit and credit card use is correlated with a decline in the use of checks, not of cash. (Lapavitsas, 88-96) Cash persists for two reasons. First, cash has paradoxically become the currency of the “unbanked,” the tokens and talley sticks of the informal sector.
This is highlighted by two new forms of mobile money aimed at the wageless: the mobile phone-linked currencies like M-Pesa in Kenya SLIDE; and the first state-sponsored “electronic money” SLIDE initiated by Ecuador. The debate over these SLIDE subaltern forms of Bitcoin replays the controversy about the origins of money itself. M-Pesa appeals to those who think money naturally appears in the market as a frictionless substitute for barter. Developed by Safaricom so borrowers could pay back micro-loans, it allows the “unbanked” to buy phone credit that can be sent to others, and has turned small shops SLIDE which sell phone minutes into micro-bankers. But it is a form of corporate money, an effort by telecom companies to challenge the duopoly of Visa and Mastercard, as well as Western Union’s stranglehold on remittances, and the shadow world of payday lenders and check cashers.
If M-Pesa in Kenya and elsewhere is an emblem of a new “neutral” market currency, the SLIDE electronic money being unveiled this year by Ecuador’s post-neoliberal populists appeals to the chartalist tradition that sees money as the creation of the state. It is aimed at the 40% of Ecuadorian adults who do not have a bank account (Money from Nothing, Economist), and seems to have two state-related functions. On the one hand, it seeks to formalize much informal economic activity, making it subject to regulation and taxation; on the other hand, it is a new way to distribute the $50 cash transfer that the government’s anti-poverty program makes to almost two million poor households every month. (1.9 million Economist article).
The struggle over these forms of digital currency has just begun. Are these digital wallets on mobile phones merely a safe and transparent form of money transfer, a form of “financial inclusion,” as the Gates Foundation argues? Or are they another way of extracting micro-fees from everyday transactions, a new stage of financial expropriation?
There is another reason cash persists, figured by the ever-expanding circulation of the Benjamin, the US hundred-dollar bill. Somewhere between a third and 80% of them are held outside the US as a store of value, a world money, a new gold standard, displacing national monies in “dollarized” countries like Ecuador. But that takes us to the offshore currents and currencies that Tao will explore. SLIDE