Science in decline

Ideas vs things, logic vs the senses, grammar vs words, objective vs subjective- this is how we make sense of the world into which we are ushered at birth. Sounds pretty dualistic, doesn't it? Much of the history of Western thought and culture is the story of what we think about these dilemmas. At the moment we are sliding down a slope, though not many know it yet. Science is a faith as much as Catholicism, with which it shares a few basic assumptions, mainly that the universe follows laws accessible to reason. Catholic thought asserts that the creation we observe is a Great Thought emanating from the mind of a Supreme Creator. Where is the evidence, the Scientific Atheist asks?

The faith scientists have in objective truth reached its high point in the 19th century. I won't go to any trouble trying to fix this point, but I would say Karl Marx and the behaviourist psychologists marked the apogee, and World War One marked the beginning of the slide. One of the articles of faith of humanists and other varieties of scientific atheist was that Reason and Objective Truth would lead to a better, saner world. With superstition vanquished, religious wars and persecutions would end. Enlightened savants would lead us to a paradise on earth. Somehow, it didn't work out. Marxism was the political wing of Scientific Atheism and it has been the most lethal political system men have yet devised. Figures are hard to calculate because many of the perpetrators, or their successors, are still in power. Without counting related damage, the number of human beings killed by their own socialist, atheistic governments in the twentieth century approaches one hundred million. I repeat 100,000,000, over three times the population of Canada. And yet atheistic socialism does not lack for enthusiastic apologists, many in places of influence, especially in schools, the media. They are especially well established in the bureaucracies of all nations, and the United Nations. How they are able to justify themselves I have no idea.

Nevertheless, their influence over the mentality of the world's societies is on the wane, as is the materialistic dogma that inspired it. And so the pendulum has begun to swing back the other way.

The most obvious example is the environmental ideology. With one foot in the materialist camp, it regards itself as scientifically based. On the other hand, it has another foot in a far more ancient world view: Pantheism. Pantheism believes that the things and forces in nature are themselves divine. The classical mythology we know from Ovid is a very beautiful version of Pantheism. But whether they know it or not- and most of them don't- scientists and especially Darwinists, are also Pantheists. They would deny it of course, replying that Pantheists believe all things have soul, and they don't believe in the soul. Actually, they have just changed the words. Instead of Proserpine and Minerva, they invoke Natural Selection and Random Mutation. Scientists don't put faces on these forces to be sure, but that may be coming as the powers of prediction they have depended on begin to wane. At that point pseudo science comes along, like the climate change hysteria. Lacking proof of the desired result, climate 'scientists' had no compunctions about falsifying the data. We'll be seeing a lot more of that. What is actually happening is a loss of faith in the possibility of being objective. This loss of faith is so severe that it is a commonplace of modern philosophy that we can't know anything, that there is no such thing as truth. This is a school of philosophy known as postmodernism and it has confused many a mediocre mind. The More confusing the better!

Although I have emphasized the problems of materialism, I don't mean to say that it is wrong and the idealist view is right. What I think is wrong is the belief that for one to be right the other has to be wrong. That's where my discussion of words and grammar in language and logic and the senses in everyday experience comes in. I have tried to show that they work in tandem. Without a grammar for a word to act upon language could not exist. It would be an impossibility. Likewise, the scientific method is sound. An idea is proposed, a hypothesis. To prove or disprove it, an experiment is devised and carried out. The idea acts on the felt world to produce a predicted result- or not. Either way the experiment is successful, as eliminating bad ideas is just as important as finding good ideas. It's a way of eliminating the noise, of separating the wheat from the chaff.

It's a very good system, but I think it there are many more implications. But it is rather dualistic and philosophers have the same attitude toward dualism as Miss Muffet had to spiders. Calm down, fellows, and take a deep breath. It's going to get a lot worse.

Beauty

Up until now I have been trying to establish the importance of reason, which is the human ability to perceive the non-material but very real logical structures of the universe we inhabit. It occurs to me to ask if those logical structures exist before they are thought of. For instance, did language exist before there was a language? Certainly there was a potential for language as living creatures very early on learned to vocalize. Birds sing, cattle bellow, elk trumpet. Hadrosaurs were a very successful and diverse type of herbivorous dinosaur. In their variety they were notable for the strange shapes of their heads which are now thought to have been echo chambers for amplifying their vocalizations. We might imagine that without cars, trucks, jet planes, leaf blowers and ghetto blasters that the cretaceous would have been a peaceful and serene time. Apparently not, with herds of gigantic dinosaurs calling to one another from miles apart. Again take note- once a behaviour is learned the behaviour influences physical change. Although they may not have had language in the sense that humans do, nevertheless the vocalizations had meanings intelligible to all members of the included group. Obviously, no hadrosaur coffee klatsch ever convened with the idea of starting down the road toward evolving a language, so we can't really say that the thought created language. But why did the hadrosaurs make such a big deal about bellowing, whistling, shrieking, for each others delectation, if that's what they did?

An evolutionist would try to explain these anatomic and behavioural features in terms of DNA, an incredibly complex molecular structure that transcribes proteins of unbelievable subtlety. The difficulty is explaining how such complexity came to be. The evolutionist has in his quiver two arrows. Random mutation and natural selection. Random mutation means that code errors will occur from time to time. Most of these will be detrimental, but a few will be beneficial. Natural selection means that the good ones will persist into the future and the poor host with the detrimental mutation will perish. Not mere death, but extinction. Cruel nature selects. Stick out your neck with some wild and crazy idea and you'll get it chopped off, chop chop.

But I have another theory. The theme of these posts is largely, how do we know what we know? And I have followed Plato in theorizing that not only do we have our usual five senses, of sight, hearing, etc, we also are able to know things through our minds, which can 'see' by the light of pure reason. I would like to propose we have another way of knowing things, and it's a way that Plato didn't particularly like. The poets raised his ire, who he accused of being liars and twisters of the truth. Many poets do distort the truth, as do many philosophers. Even nature fools us. For instance, our senses tell us unequivocally that the earth we stand on is solid and immovable, while the sun and moon are smallish objects which rise on one horizon and set on the opposite. So our eyes tell us. Similarly, the stars and planets are mere pinpricks of light that roam the night skies. Truly, human beings have venerated these celestial presences as far back as we have been human. But it took reason to demonstrate, and a long, arduous process of reasoning, that the earth is not only moving, but that it is but a tiny fragment of moist rock orbiting a star which is itself only one of billions upon billions of suns. The geometers of Plato's era started us down that road when they calculated the circumference of the earth, and Plato, a geometer, was probably contemptuous of the myths telling of gods cavorting in the sky.

What poets and artists and musicians deal with- at least they did until the twentieth century when they came unhinged- is beauty. Art isn't exactly based on reason, even though all arts are built on a highly rigorous logic, and it isn't exactly based on the senses, even though each art works through one or more of the senses. In this way, beauty is a lot like logic. It manifests itself through matter, but matter itself is not beauty. But it is unlike logic in that we perceive beauty directly. When we see a blazing sunset we don't need mathematical calculations to tell us we are witnessing something beautiful. It doesn't matter to our appreciation of the sunset that the earth revolves around the sun. We don't have to know about nuclear fusion to enjoy the sight of the sunset. When we hear a beautiful piece of music we don't need to know anything about sound waves or decibels. Perhaps knowing something about key signatures enhances our appreciation but only to the composer is that sort of knowledge essential.

This kind of beauty gives us pleasure, but not the kind of pleasure that comes from eating a tasty meal or copulating with a lover. Aesthetic pleasure is experienced through the mind more than the body. Our stomachs are soon filled, our debaucheries soon leave us depleted. Attempts to extend those pleasures much beyond their natural uses leads to a diminishing sense of fulfillment. The glutton grows fat and diabetic, the roue needs more and more perverse stimulations to achieve arousal. Those unable to attain the desired pleasurable feelings through food, sex, or other means often turn to chemicals. For these people the mind becomes the enemy. It craves satisfactions they are unable to gratify and so it must be destroyed. Drugs that deaden the pain or conversely deliver ecstatic feelings become a necessity.

But the pleasure we derive from observing a beautiful sunset never diminishes but enhances us. We feel drawn toward something. We may not know precisely what it is we are drawn to, but we know it is a good thing, that we are better for it. We also know that someone who can't appreciate the beauty of a sunset lacks some essential element needed to be fully human.

Western thought of the last few centuries has lost faith in the value of our capacity to perceive beauty. It is a train of thought that denies even the existence of anything other than material objects, and therefore every explanation for the observed world must refer to those material objects.

For the next few posts I will try to refute that view.

The power of limitations

Life, language, money all have a material nature. Proteins in the case of life, words in the case of language, gold or silver in the case of money. However the physical facts alone are insufficient to explain the essence and meaning they represent. Each system (like little universes each with its own laws and entities) has a logic without which it is useless. The logic of life lies in its genetic structure which operates in a similar way to grammar in language. Money has a logic too, as a unit of value so humans are able to exchange goods and labour efficiently. If the logic- the relationship of value to the standard represented by gold- is violated, then money dies, and so does a modern economy along with its elaborate arrangements devised for keeping accounts. It's not possible for money to be whatever we want it to be any more than it's possible for a flesh and blood creature to do whatever it wants. It isn't possible for a tuna to live on land. It isn't possible for a human to breathe underwater. Likewise, a word has to have a settled meaning. It would be absurd if I should define a tuna as a fish in one sentence and as a pound of butter in another. A word needs a meaning agreed upon by all the speakers of the language or else the language becomes useless.
Strangely enough these limitations aren't weaknesses but strengths. All of the adaptations that make it impossible to live on land endow a tuna with a superbly sublime ability to function in the sea. Almost all creatures vocalize, but only humans have learned how to transmute sound into a full-fledged language. In a sense, we decided we didn't need tooth and claw. The ability to speak made it possible to have a complex culture which has made it possible for us to swim as well as a tuna, fly as well as an albatross, and kill with an efficiency far exceeding T. Rex. We take in air to supply oxygen to our blood which delivers it to our individual cells, and also to remove the waste gas, CO2, which is produced as our mitochondrial organelles burn sugar. Speech utilizes this escaping gas through vibrations in our larynxes amplified by the echo chambers of our sinuses. A neat trick which no scientific theory based on a materialist set of assumptions could possibly predict. Most other animals use chemistry to communicate with one another, but we use sound, just like birds. Only we have developed that logic much further than any other creature.
I didn't use the trope of "little universes" lightly. Only when a limiting set of principles is established is it possible for one of these little universes to come into existence.
The universe of living things seems to be possible through limiting itself to the properties of the carbon molecule. Culture is possible by limiting itself to to the properties of language. By assigning to a unit of currency the role of measuring worth the enormous potential of human ingenuity has been unleashed.
It even seems as if the universe itself is a limiting set of principles, but I'll try to remember to get to that later. Science has gained great power by limiting itself to the study of the physical facts as we are able to perceive them and mathematics has gained its power by limiting itself to numbers.
Games provide a seemingly trivial illustration of how a set of limitations can create a new set of possibilities. There are fifty two cards in a standard deck, and by limiting the way those fifty two cards can be deployed an almost inexhaustible plethora of games has been invented. Random doesn't work in card games, just as random doesn't work in the construction of an organic creature. From the limitations structure is created. Structure is the opposite of random. Structure is limitation, definable as much by what it isn't as what it is. In order to create a card game, it is necessary to place limits on what a card may do. The rules of a game are those specifications. They are what makes poker different from gin rummy. How many players. How many cards to a hand. How dealt. How played. The cards are like vocalisms, the rules providing meanings to the vocalisms and a grammar. A given card has a certain meaning. There are certain things it is allowed to do. Card games can be classified according to species and class. Is the game a whist variant or does it belong to the genus rummy? Or poker?
This same rule can be applied to any game. Ball games. Baseball and football are both ball games requiring players with the ability to throw and catch but they could hardly be more different. The rules for each game are radically different and to do well a player must adapt himself to those rules. There is always a temptation to cheat, but if the boundaries are stretched than the whole game changes and it is no longer truly baseball or truly football. Therefore, a player is not allowed to put a hunk of lead in his bat or ride a motorcycle to steal second base. Just as in living things innovations are not allowed.
When a set of limitations is initially imposed it may not be at all clear to the originators exactly how things will play out. The true possibilities of the game only become clear as experience is gained. Even when experience is accumulated, especially obvious in a game like chess, no one person can know all the permutations. Each separate game is a new adventure… in effect a new universe. The players learn to navigate the universe by accepting the conditions imposed by the rules. One can say of an enthusiastic bridge player that he is a devotee of the game, appropriating a word from religious terminology.
This is all very peculiar when you think about it. Consider: a card game is an invention of the human imagination, and yet individual human beings are incapable of grasping the universe of possibilities the card game presents. Otherwise it would be possible for someone to play an absolutely perfect game. However the community of bridge players is a repository of bridge wisdom of which each player may partake. Bridge is even more interesting than most card games due to it being played by partners so that each player must take into account the expertise of his team mate. Some games are so well played they become famous. Devotees of the game study them. They become objects in the real world just as much as a chair or a theorem in geometry.
This is also true of language. No speaker of a language can know the entire range of possibilities of his language whether it's an advanced literary language like Latin or English or an oral language known only to a community of a few thousand. In other words, the language has an almost independent being. Individual speakers partake of it. Moreover, language constantly changes, just like genetic information constantly changes, so it not only has a community of living speakers, but a larger community of speakers who are no longer alive and who have yet to be born. When a master of language comes along whole communities of scholars arise to study his words. Think of Shakespeare and try to imagine what the English language would be like if he had never been born. It's impossible. The most unlettered speaker of English owes him his means of communication without even knowing it. Not confined to the enrichment of language, a great national poet shapes the very thought patterns of his culture. If it's difficult to imagine English without Shakespeare, it's impossible to imagine the Hebrews without the Bible. I think it's fair to say that without the Bible they would not exist. And so it is with language as a whole. Language is our invention, what makes it possible for us to be human. Without it we could not exist in our present form. All our other attainments are contained within the possibilities of language.
All of these cultural manifestations might be thought of by mathematicians as a subset of language. Would that include their own discipline? But can we really say culture is a material object as much as a chair? Well, obviously I can't look out the window and see a big cloud of English floating by. I can't smell or hear this abstract entity from which I draw the words on this page. Nevertheless the life of every human being is based on communing with it. I don't know if any other word will do. We are ready at birth to commune with the language of our people. The capability is inborn, but the specific language must be learned. We may not be able to see, hear, touch or smell it, but while we can function in society without one of those senses, we cannot function without the ability to perceive and interact with our language which is a thing exists independently from our individual selves. We create it, we use it, but it is not possible for any individual to contain the entirety of it.
If a language or a game or any sort of logical system could be any arbitrary thing we might imagine then we could conclude that it was just a mental artifact with no independent existence. It could be whatever we wanted it to be. But as soon as a vocabulary and a grammar are devised it declares its independence. From then on we become communicants with its mysteries and must puzzle out its nature.
Which brings us back to the question of how we know a thing, and if the senses we commonly use to perceive the external world are supplemented by another type of sense, another type of perception.
I think this was the central question Plato was trying to work out when he proposed another type of light, the light of pure reason. Of course this raises a number of other questions. He tried to answer the one about where the light came from by saying it came from the Good and he tried to answer the question of what it was that we saw through our sense of reason by saying that the objects of our everyday experience had a greater, more perfect being in a higher existence. These 'forms' have been the subject of debate ever since. They are a conjecture that quickly ran into trouble, but maybe there do exist structures in the universe that are only amenable to reason and maybe we can learn more about them and more about ourselves and the universe in the bargain. Maybe nothing is quite what we have come to believe.

The universe as a great thought

Materialists of whatever variety think they have simplified all those abstruse problems of existence that have troubled philosophers and theologians for as long as creatures of that ilk have existed. Forget about unprovable speculations, like God, the immortal soul-they are nothing more than the fevered imaginings of the human race in its primitive, unenlightened stages, they say. Now that humanity has reached its maturity, we have science and mathematics which have helped us resolve all those ancient questions, and we have found out that the universe needs no explanation. It just is and that's all there is. We can learn everything there is to know by picking it apart, examining its components and searching out the laws that govern interactions among those parts.
It reminds me of what Jesus said on the cross: "Father forgive them for they know not what they do." My guess is that he was speaking not only of the rejection by the Judeans of his message of love, redemption and peace, but of their failure to perceive the miracle of their own creation. Likewise modern materialists. The kind of proof they demand, based on the rules they have set forth, is not forthcoming...not because proof is absent, but because the way the question is framed there can be no proof. As I've tried to explain in metaphorical language, there is nothing in the internal evidence of a movie to suggest the complex process of conception, organization, technology and hard, tedious labour that goes into making it. The content, or the meaning, of the movie has even less to do with the physical facts of manufacturing the physical artifact, whether on film or digitally encoded. The movie itself has a meaning entirely different from its physical facts. A young Judy Garland sings, "You made me love you, I didn't want to do it, I didn't want to do it...' Nothing can be learned about the meaning of the song, of her voice, the beauty of her youth, her performance from studying the properties of acetate. Charm, youth, beauty- how can that be measured anyway? Materialists will rightly point out that nobody would have seen or heard Judy without the acetate. They might even say that Judy no longer exists, and the only reality she has is the shadow cast by a beam of light shining through that acetate film.
So one can neither find in the shadows on the screen direct evidence for the existence of cameras, film, means of distribution- the kind of proof atheists demand for the existence of God- nor can one find in the materials of the film the purpose of the film- its meaning, ie, plot, characters, emotion.
This is why if I were trying to justify the materialist position I would be frightened by the difficulties of my task. Even more so when it is obvious that at least when it comes to human activity the thought, desire, intention often precedes the coming into existence of a new reality.
When we move into the more abstruse realms of scientific investigation things get worse. Theoretical physicists speak of the arrow of time and puzzle over why it only points in one direction when their equations can find no reason why it shouldn't point toward the past as well as the future. We don't experience time as an arrow so much as a wave. We are caught in it and it bears us along willy nilly on it's crest. We live in the perpetual now. Nothing in the past or the future exists in the sense that we can touch it. Yesterday is gone, persisting only in our memories and in artifacts which might be termed a kind of memory. The future we anticipate with anxiety but no sure knowledge. Perhaps we build things to make the future more knowable. If we had the prescience of a god, perhaps time would then appear to us as a landscape appears to us now, composed of mountains and valleys, seas and plains, full of times to which we can travel as easily as we can to a neighboring town. But since we are not gods we can never travel to yesterday, nor even see or touch it in any way. In the eternal now it simply doesn't exist. Another way to think of it is that the entire cosmos and everything in it is in a continual state of creation. How can a materialist explain time which is not a thing at all? It's true that theories have been devised to explain how time works in relationship to speed and acceleration, but the explanations seem to raise more questions than they answer and seem to deal mainly on a cosmic scale. Quantum theory seems to deal with phenomena on the atomic, submicroscopic scale. We earthlings occupy a territory in the center.
The materialist dogma not only proposes that everything can be explained by examining the physical facts of the universe, but that the process by which these facts- solid matter, heat, light, distance, ourselves, others- come about is mindless. This is the true distinction between the traditional assumptions of Christian thinkers and the new model proposed by the atheistic materialists. Because even the new model still assumes a consistent pattern to the fundamental laws of science. But it can't even begin to explain why it should.
However, I have long been convinced of the truth of the dictum that says the universe is more like a great thought than anything else. I would go further and say that the universe has a personality. Not that this is an explanation. But looked at in this way the universe makes a lot more sense. Things come into focus. New lines of inquiry are suggested. It also makes me feel better. The universe is the product of a mind, and it is the product of a mind not unlike my own, although vastly greater than mine can ever be.

Value

Language is about conveying images from one mind to another. Things and actions are denoted by words. How words interact with each other is conveyed through grammar. Thousands of languages are spoken in the world and each language is a world unto itself closed off to anyone outside that linguistic community. The language in turn shapes the members of the community, shapes the very mind of the community. Thus a language, an exceedingly abstract construct, has the power to shape how people think. The language of the community also serves to signal whether someone is a member of the community or not, because languages aren't so easy for an outsider to learn. Nevertheless, every normal human learns to speak his own language effortlessly. Without any help from a grammarian, any five year old can perfectly well express complex thoughts in his own language.
Money is a far simpler thing to use than language, and yet it is far more difficult for the average person to understand. It crosses, even erases cultural boundaries and reduces economic relationships to a single number. At an every day level money is comprehensible to anyone who can count. At the level of abstract theory the monetary system seems incomprehensible. Money is described as debt. What does that mean? It means that when you have ten dollars in your pocket the world owes you ten dollars worth of goods or services. But money has a far more basic definition. It is a unit of value.
Everyone understands price tags. In the supermarket it says, "russet potatoes, $.50 per pound. Easy. The shopper has five dollars to spend on potatoes for which he can obtain ten pounds of potatoes, fifty cents being worth a half dollar. But how is it decided that a pound of potatoes at the supermarket is valued at a half dollar? There's the mystery. What is a dollar and how does it translate into potatoes, tractors, an hour's worth of a plumber's time? Who decides? Not even the strictest of tyrannical regimes can enforce the value of a dollar relative to a pound of potatoes, although many have tried, usually with ruinous results. Only the market can do that. And how does the market establish a value? Every individual who makes a decision whether to pay $.50 for a pound of potatoes helps decide. Let's say the price was $.25 per pound yesterday, and the shopper had every intention of buying twenty pounds with the ten dollars he has in his pocket and spending the other five dollars on two pounds of pork chops and a bunch of carrots and some onions. What does he do when he finds out the price has gone up? He might buy fewer potatoes. He skips the pork chops. He might buy rice instead of potatoes. He might go to a different store. In any event the store owner may not be able to sell as many potatoes as he expected. He might lose money instead of turning the fat profit he had hoped for. The market decided it would rather do without potatoes than pay $.50 a pound. So the next day he marks them down to $.39 to get rid of them. That's the way the market works.
In truth, the buyers and sellers are not negotiating how many dollars a given quantity of potatoes are worth so much as how much a dollar is worth. It may seem to amount to the same thing, but it doesn't. What's true of potatoes is also true of oil, lumber, a toaster, a hat, and especially gold. If you read the financial section of the paper and you look up the price of gold for that day, you might see it quoted at $500.00 per ounce. In reality, it doesn't really mean that. It means a dollar is worth one five hundredth of an ounce of gold. This is because the supply of gold doesn't fluctuate that much because it is a rare metal. Neither does the demand fluctuate that much. In times when the unit of currency is in a state of declining value the demand for gold does increase because nobody wants their stores of cash to depreciate. A rush to exchange worthless paper for solid gold ensues. But the actual value in terms of assets does not fluctuate very much unless there is a shortage of those assets. For many years the value of a dollar was pegged at $35.00 per ounce of gold, but in the end the value of gold is the bedrock of any currency even without official endorsement. This had the effect of enforcing discipline on the money markets. As soon as the central authority tries to issue more paper than gold is worth, inflation will begin to distort the economy. Ignore the fundamentals and catastrophe follows, as in Zimbabwe where a cup of coffee now costs billions of Zimbabwe dollars.
Unbundling the value of a currency from gold often results in economic chaos as schemers like George Soros and Warren Buffet figure out how to game whatever system is in place. This prompts capitalists to promote a return to the gold standard and socialists to politicize the banks. The twentieth century provides numerous examples of what happens when socialists try to fit the market to their own theories.
Gold has one big problem. It is inert. Profit is good thing. Someone with a talent for growing the economy should be rewarded and profit is a perfectly good measure of that reward. Reduce this to basic terms. A farmer to be successful has to at least have enough grain left beyond what he can consume to save for seed, and if he is prudent he will set aside another share for bad years, just as in biblical times. But suppose his crops are so bountiful he still has a surplus of grain. It does him absolutely no good to save it until the mice eat it. He looks to do something else with it. He might trade some of his surplus with someone else, say a shepherd in the hills who has more wool and cheese than he knows what to do with but lacks grain for bread. If the farmer and the shepherd make an exchange they are both better off than they were before. Notice that one did not have to suffer loss in order for the other to profit. They both profit. They can concentrate on what each does well with the resources at his disposal. They are better off together than they were separately. This is very easy to understand. The inevitable problems arise when cleverly predatory people who don't want to farm or herd grab the surplus for themselves, perhaps destroying the source of wealth in the process. Socialists are very good at destroying wealth and so are the linear descendants of bandits. They do this by punishing the people who produce wealth.
Gold coinage for all its advantages had the distinct disadvantage that it was possible to hoard it. No spoilage to worry about. Unfortunately, when gold is hoarded it is out of circulation and therefore inert. It does nobody any good, not even the hoarder. It just makes him extremely attractive to thieves and robbers. And why not? What good does it do locked up in a chest somewhere? Better to grab it and spread it around, except that it's always been far easier to rob poor people of what little they have. When gold is hidden away in a vault the wealthy man's savings cannot be used as seed money to increase the wealth of the community as a whole. This is why the transition away from coinage to paper notes and numbers in ledgers caused such a rapid expansion of the economic base in the west. All of a sudden it was possible to use money to make more money.
What held things back for some centuries was the distrust by the Church of interest bearing loans. I am a great admirer of the Church but in this the patriarchs were mistaken- at least if a prosperous and well fed populace is considered a good thing. Intuitively, it seems somehow immoral that a wealthy man should grow even wealthier merely by putting his excess money out to rent. But the wealthy man doesn't just toss his money to the winds. He chooses where to put it. This is the skill he has. He knows where it will do the most good. At the same time, he takes the risk of losing his investment. This is also a good thing as failure is one of nature's best teachers. It not only starkly illustrates bad decisions, it also separates the rabbits from the lions.
But without gold as a reference point it is exceedingly difficult to establish the value of any given good or service. Today the US dollar has largely supplanted gold as the reference point, but since the general public is largely ignorant of the arcane art of monetary policy, it's entirely possible for all sorts of shenanigans to take place without anybody but insiders being cognizant...until everything blows up in their faces. At the time of this writing we have been afforded an opportunity to witness a meltdown of the financial system as a result of shenanigans known as hedge funds, derivatives, sub-prime mortgages each of which attempts to do one thing in its own way: pretend there is value when none exists. This prompts average investors and savers, like home buyers, to transfer their earnings to something they think will grow in value but which is overpriced in the first place. Eventually the bubble will burst. There are a lot of smoke and mirrors involved in setting the value of something when the unit of value is chimerical. Nevertheless, wherever it has been adopted the modern system of money capitalism has ushered in prosperity and ease unprecedented in the human experience. It is not reserved for the few, but available to the many, to anyone who is willing to participate. We like to think of technology, science, democracy, social factors like a work ethic, whether protestant or Confucian, as the drivers of this prosperity, but without the modern banking and monetary system there would be no way to organize this economic activity. Socialists have proven over and over that they can't do it. Every socialist system ends up impoverishing its subjects. This is because socialists, try as they might, are unable to make the value of something be what they think it should be.

History of money II

When I was younger my favourite type of reading after science fiction was history and I don't know how many histories of the Roman Empire I read. I tried to understand how a civilization that was so powerful in its day could collapse. From its beginning in mythological legend to its historic demise at the hands of Germanic invaders, Rome is an engrossing story, one that begins in dreamtime and ends in collapse and ruin, a real life tragedy. The histories I read were primarily popular narratives which emphasized the doings of armies and emperors, and each writer had his own particular explanation for why it fell. One common theme running through many of the accounts was the debasing of the currency. Debasement means, of course, that the precious metals used in the coinage are diluted with metals of lesser value, mainly copper. While the historians all had different theories about what caused the debasing they all agreed it was a bad thing.
But let's back up a little and ask why the currency was always and ever under pressure to be debased. The short answer is that the emperors needed money to pay off their debts and they incurred their debt in order to pay the legions. The long answer then as now is that there is never quite enough money in the system to finance expansion. In recent times the desire to pump more money into the system has led to orgies of canal and railroad building in the nineteenth century, dotcom bubbles in the twentieth, and a mortgage bust in the twenty-first. In Roman times it was the army that kept the commerce routes open and made everything else possible. It was the Roman army that built the roads, the aquaducts, the port facilities, and the strongholds at the edges of the empire. Within the empire thus protected a rule of law was enabled to flourish. It was possible for a Roman trader to travel from Syria, through North Africa, across to Iberia, and eventually make his way to the borders of the wild Picts in the north of Britain. He could then continue on back to Gaul, crossing the Alps to Italy, take ship to Greece, Asia Minor and back to Syria, buying, selling and trading all the way. Language was no problem as long as he spoke Latin or Greek. The coinage of Rome was good wherever he went and he was protected by Roman law. It was thanks to this Pax Romana that Paul of Tarsus was able to spread his message, whether through personally visiting the newly founded churches or using the Roman postal system to convey his epistles along the roman roads or in Roman ships.
Try to imagine what it would be like to shop if the smallest denomination was a thousand dollar bill. That was roughly the case in the early days of coinage. It was good for large items like the purchase of land and slaves but not much good for buying a loaf of bread. I think this may have been another one of the pressures leading to a debasement of currency. As money became more common, smaller and more numerous economic transactions could be conducted with it. And money is much more convenient than barter so when more money is in circulation trade will increase. Economic activity migrates from the home to specialized shops and tradesmen. Penelope no longer weaves her husbands winding sheet in the palace loft. She buys it from a cloth merchant, to the detriment of literature perhaps, but she has more time for politics. Everybody wins. I think.
This is why the money supply has grown almost continuously in the centuries since coinage was invented. When it does fail, as it did at the end of the empire, so does civilization as we understand it. In Europe a dark age lasting centuries followed. Long distance trade virtually ceased. People could only consume what was produced locally. Civic life ceased. When money slowly came back into circulation it allowed central monarchies to begin to reduce the strength of local military warlords. Money expands the reach of economic activity. People become richer. Taxes flow into government coffers. The prince who adapted to the monetary model prospered and grew powerful, his court turning into a magnet for impoverished knights and lesser nobility who now owed their standing to the largesse of the prince.
In Italy the Renaissance was ushered in by merchant princes like the Medici in Florence who had the wherewithal after hiring mercenaries to fight their incessant wars to commission works by Leonardo and Michaelangelo. A mania took hold among them to amass collections of Greek and Latin manuscripts.
It was during the Italian Renaissance that pieces of paper began to replace coin. This is a major milestone in the evolution of money. Promissory notes, letters of credit, and many other instruments were invented to reduce the ever present danger of robbery in a world no longer protected by a central authority. The political of Europe was hopelessly fragmented with every jurisdiction issuing its own coinage. This provided an opportunity to money changers in Italy who took on the chore of converting one currency to another while taking a commission for themselves. As they accumulated capital they were able to get in the business of advancing loans. The Church prohibited interest at the time so the money changers had to be rather creative in how they earned income from loans. These money changers soon realized that it wasn't necessary to ship coin every time a commercial transaction took place. An entry in a book would do the job quite well. Before long entries in books represented by pieces of paper in circulation, backed by the reputation of the banker, substituted for real gold and silver. Our word 'credit' comes from the Latin word for belief. Money was distancing itself from a connection to gold and silver and becoming a figment of the bankers imagination. This marked an enormous increase in the money supply available for economic activity but it also made it difficult for the non banker to comprehend. In essence, banking had become a kind of priesthood. Our modern banking and currency system is in direct descent from those Florentine money changers.
Even after all these years the priesthood is still prone to making catastrophic blunders but because the system has grown more and more arcane, fewer and fewer people understand it. Cast loose from its gold and silver moorings when the world's major economies went off the gold standard, money became a purely imaginary construct. Those who grasp its dynamics can grow fabulously wealthy and are able to influence world events- even going so far as precipitating a money market crash in order to propel a favoured (malleable?) candidate into the most powerful political office in the world. A trimmer was a name applied to a person who trimmed the edges off coins and saved the gleanings to his own profit. The art of trimming has come a long way since the old days.

History of money I

Money. Somebody recently wrote that he had a love affair with money but that it was an unrequited love. That about sums up my relationship with money. In other words, me and money are not on intimate terms. If money is a dame she's a high maintenance gal to whom I don't pay enough attention. Truthfully, I don't love her enough and in return she declines to honour me with her favors. In other words I have been spared, as O Henry put it, "those ills attendant on superfluous wealth." In still further words, I am not exactly an authority on money.
I hope the old gal won't be too insulted if I poke around in her private parts for a few posts.
Maybe I'll start out with a nutshell history of money. Money is essentially a medium for storing and distributing wealth. Itinerant pre-agricultural societies could accumulate no more wealth than what they could carry but wherever settled agriculture established itself seed grain had to be set aside from the present harvest and saved or there would be no more harvests. The very fact that grain is relatively imperishable compared to most other foods is one of the main reasons civilized society succeeded and grew wealthy. So it's entirely fair to say that farmers were the first capitalists, their stored grain being the first form of capital. But money hadn't been invented yet, so a way was needed to organize the distribution of capital, and the ancient temple priests took on that task. They learned writing to keep track of who owed what to whom, they learned arithmetic to calculate how much, they learned geometry to resolve disputes over land ownership, they learned how to build cities and grain storage facilities, and they organized armies to protect themselves from people who would take it away. Evidence seems to point to Mesopotamia as the area where this sudden change in human destiny occurred, and it was not long afterward that war between Mesopotamia (present day Iraq) and the nomads of the plateaus and mountains to the east (present day Iran) began.
I say suddenly, because all these developments, writing, cities, a priestly class of scribes, settled agriculture, arithmetic, were invented within a few generations and the world has never been the same since.
But they didn't invent money and this was a handicap. Then as now gold, silver, jewels, and other things humans covet represented value, and they were used as standards of value by which the relative worth of other forms of wealth could be measured but it was a cumbersome system. Nevertheless, it took another 3000 years before somebody in the kingdom of Lydia in Asia Minor got the bright idea of issuing disks of gold and silver, of standardized units of size and weight, stamped on each side with images of kings and deities as symbols of trust.
This was another monumental change in human affairs. All of a sudden a man's wealth could be stated in terms of how many of these disks were in his possession, regardless of how he had come by his wealth.
A few words here about gold and silver. It's commonly thought that these metals are intrinsically valuable. They are not. They are useless. They can't be eaten, they are too soft to be made into tools or utensils, and gold is too heavy to carry around. However, gold and silver are shiny and people like shiny things. They are rare, which arouses innate human covetousness. "Aha, I have one and you don't." And they don't (especially gold) deteriorate over time. These are the qualities that make those metals ideal for use as a currency.
Is it an accident that Greek and Roman dominance of the Mediterranean world coincided with the adoption of coined money or is it a consequence? I don't mean to minimize the importance of Greek ideas and culture or Roman engineering and military genius, but how far would it have gotten without the enormous increase in trade and commerce made possible by coined money?