Incentives of Individualism

There are some childhood studies that offer a useful insight about human nature and society. They indicate certain behaviors that appear to be inherited, rather than learned.

The specific behaviors are a natural response to be helpful and cooperative. Kids, when presented with an opportunity, want to open the door for someone with their hands full or to pick up an object someone drops. They don’t need to be told to do this. This is basic social behavior, without which early societies would never have formed.

These studies, however, demonstrated something even more telling about our present society. If you give kids a reward for good behavior, it actually ends up disincentivizing good behavior. Yet the belief in incentives is the basis of our entire capitalist society. Selfish individuals aren’t born. They are created. It is inevitable that strong communities, civic society, and culture of trust weakens as capitalism takes over more and more aspects of life.

That gave me an insight. There are various theories, Julian Jayne’s bicameralism being the most famous, that individualism as we know it didn’t always exist. What if the development of systems of incentives was a major factor in creating individuals.

This would have been a slow process. Monetary systems were developed in the ancient world. But at that time they would have had little use to the average person. And it was limited to only a few societies. Most of daily living for most people in most societies would still have involved the even more ancient traditions of gift economy and/or barter. It wasn’t until after the collapse of bicameralism (or however one wishes to explain that transition) that monetary systems became more central. It was centuries into the post-bicameral Axial Age before coins began to be minted.

Like writing, the early monetary systems would only have initially and directly effected a small number of people. Think how long it took from the invention of writing to when the majority of most societies were literate, two to three millennia. Barter was the main economic system in some American communities well into the twentieth century. It was in the major cities where these kinds of things took hold first and even there it developed first among the upper classes. Writing and currency did co-develop to some extent, as writing was earliest used for purposes of accounting. And accounting would in ancient societies would only have been a concern for governments and the elite of large-scale business owners and traders.

The trader, in particular, would have been in a position to develop individualistic behavior the earliest. Traders not only dealt most directly with the developing monetary systems, along with writing and accounting, but they also were the people who spent the most time outside of their home communities. This was at a time when most people spent their entire life never leaving the community into which they were born.

So, if my hypothesis is correct, this is where we would want to look for the initial developments of individualism. It’s also in the modern world among businessmen, stockbrokers, etc where we’d want to look for the most extreme behaviors of individualism.

It might be interesting to anthropologically study business management schools and corporations to see how they help further individualize people. Then we might want to consider what happens when a society becomes so individualistic that the social bonds that hold society together begin to fray, as we are now seeing.

US Currency: Gold & Guns

I was listening to Coast to Coast AM a couple of hours ago and the guest was discussing gold. The show in general attracts many right-wingers and libertarians which is why gold is a topic that would be discussed. I found the interview a bit educational.

At one time, US currency was backed up by gold (25% of each dollar was backed up). However, no one knows if our money is still backed by gold or not. Fort Knox still exists, but there has never been an audit of what is still kept there. Fort Knox has been used for many purposes including keeping safe items for other countries. Even if there still is gold in Fort Knox, it may be owned by private or non-American interests.

All of that is interesting enough, but the reason I wanted to write about it is that it got me thinking. The show guest mentioned that gold has little practical use. Isn’t that intriguing. Gold is valuable  because it’s worth is almost entirely subjective. Gold’s value remains stable because it isn’t dependent on any objective factors. Basically, gold is almost entirely worthless except for the fact that we pretend it’s worth something. It’s only value is that humans like shiny things.

It’s lack of any inherent value is what makes it such a good investment. Since it’s value isn’t dependent on objective factors or practical use, gold remains valuable and actually increases with value when the economy goes down. The only use gold had in the past was in making coins and jewelry. It has been used to back up currency because in the past it was used as currency and as bartering objects.

The show guest, of course, was recommending that people buy gold because it’s such a safe investment. I understood his argument, but I saw one problem. Gold will maintain its value as long as the economy is still functioning. However, if society’s infrastructure collapses, it’s pointless to own gold. In such a situation, it would be better to own stockpiles of guns and bullets that could be used for both protection and barter.

What makes gold a safe investment is exactly what would also make it completely worthless in a real emergency. If you’re truly worried about social collapse, you’d be better off building a cabin or bomb shelter in some secluded wilderness area. And, instead of filling your emergency shelter with gold, I’d recommend filling it with food and other practical supplies.

There was one other point the guest mention which really intrigued me. When the US decided to stop using gold, some Middle Eastern countries stated they wouldn’t sell us oil for mere paper money. US military might changed their opinion on the matter and they decided it was in their best interest after all to sell the US oil. What this means is that our currency is now backed up by guns rather than gold. This is the real reason the military keeps growing. The US has become an empire with military bases in countries all over the world.

It’s all rather ludicrous. All of the world’s economy is (or has been in the past) almost entirely based on US currency, but US currency is backed by nothing but guns and debt. Other countries buy our debt while we point guns at their heads. China, however, has bought our debt while becoming a military power itself. If WWIII happens, it will likely be because of this precarious gun-backed US currency. The US holds off debt at the end of a gun. Any country that challenges the US on this issue will be in a world of hurt.

Even more ludicrous is the fact that the very concept of debt is a complete abstraction. All currency and all of the world economy is based on fear of violence and trust that violence won’t be unnecessarily used. Everyone has to keep the illusion going for as long as possible, but eventually the illusion will collapse in on itself. The US deficit is ultimately meaningless. China owns most of US debt meaning all Americans are welfare recipients of the Chinese economy. Even so, there is no reason the US would ever pay China back. The Chinese government probably understands this, but they’ve used this relationship with the US to build up their own economy at the same time.

As long as there aren’t any major catastrophes to the world economy, the game can continue as it’s presently being played. If China decides to force the hand of the US government, then war will be inevitable. And if the US wins that war, all debt would be erased as if it never existed.

I don’t know what to make of all this. I just find it amusing. The economy, currency, and gold are all a game of make-believe.