Marx, Money and Mammon
Marxism: a divide and conquer strategy
In 2000 I joined the nascent Green Party embracing the idea of “not left, not right, but out front.” I thought that was an important distinction for challenging the left/right duopoly of the major political parties. At an annual meeting in 2007, Stephen Zarlenga, founding director of the American Monetary Institute gave a presentation on monetary reform explaining how money was an instrument of power and that the power to create it greatly multiplied that power. The institute had even written a legislative proposal for a sovereign monetary system. This prompted Greens, who saw its possibilities for revolutionary change, to adopt monetary reform into the party’s platform in 2010. Despite this, the party has never put the proposal forward as part of its national campaigns, largely, I think, because they never felt knowledgeable enough to talk about it or it was an issue that would have to be explained to people since most people have never heard of it. And so today it remains languishing at the very bottom of the Green’s platform.
However, when Congressman Dennis Kucinch met Stephen, learning of his proposal and the history of monetary reform, he recognized the enormous possibilities to solve many of the nation’s problems. Having spent years trying to get beneficial legislation passed, he was familiar with how the power of money corrupted the system. In response to the banking crisis of 2008, he immediately began to draft legislation to change the monetary system from a private for-profit system, commanded by the elite bankers, to a debt-free public money system dedicated to the general welfare of the nation.
After three years of vetting by the Office of Legislative Counsel, he introduced The National Emergency Employment Act (The NEED Act) HR2990) in 2011. As one might expect, the most revolutionary proposal in over 200 years was not allowed out of committee for a debate and a vote. He was also gerrymandered out of his office the next cycle by his own party for having the audacity to propose such legislation.
One might ask, what does any of this have to do with Marx? Well, not much really, but in the political discussions I have had over the years, the most vociferous opponents were Greens who considered themselves Marxists, though the party as a whole does not identify as Marxist. I had read some of Marx when I was young but finding no actionable solution continued my search for solutions.
Once while I was explaining monetary reform and how it would eliminate capitalism to a young self-proclaimed Marxist, he suddenly stood up and said “but I thought capitalism was supposed to continue to its end” and he left in a hurry, refusing to speak to me anymore. I later discovered that Marx didn’t require any reform because he postulated an inevitable progression toward his desired outcome. Capitalism would either collapse or the workers would get so fed up with it they would kill all the capitalists.
However, the Green Marxist’s opposition to money seemed to be based more on ideological belief than on any genuine understanding of how the monetary system worked. They seemed to assume it was Mammon, an evil to be done away with. They seemed to embrace the idea that “The master’s tools will never dismantle the master’s house.” (An unfortunate quote from Audre Lorde who did not intend it to be interpreted in such a defeatist way.) As a former builder I can tell you that the same tools used to build a house can just as easily be used to tear it down. In fact, depending on which tools you choose it can be torn down faster than it was built, though many of the materials would then be unsuitable for reuse.
Mammon has been portrayed much like Tolkien’s Golam, a pathetic creature clutching his gold and, just as often, a giant scary monster hoarding golden treasures. The Bible conception is that of an evil force, a spirit or demon that deceives people into putting their trust and faith in riches instead of God, or in this case, instead of Marx. While Mammon has mistakenly been regarded as money itself, it was the love of money that was the evil to be avoided.
As a student of monetary science and political economy, I was somewhat taken aback at their rejection of this ancient human innovation that emerged with the division of labor to facilitate exchange eliminating the inconveniences of barter. Because money at that time was a commodity, it eventually became dominated by the elites who owned most of that commodity. Their rejection of money made me want to review what Marx believed about money. While Marx never quite figured out what to do about the monetary system, he at least understood the problem with the banks.
Karl Marx was heavily influenced by Adam Smith whose work he had studied for 20 years reading about economics at the British Museum’s Library. Marx best-known works were with Friedrich Engels, the 1848 pamphlet The Communist Manifesto and his three-volume Das Kapital (1867–1894). Marx’s ideas and their subsequent development, collectively known as Marxism, have had an enormous influence on modern intellectual, economic and political thought.
Smith and Marx were both internationalists rather than nationalists. Like Smith, Marx began his magnum opus with a discussion about money. Like Smith, Marx’s method was theoretical analysis. Like Smith he believed in the primitive commodity concept that money was gold, or based on gold, or other precious metal and paper money was a token for gold. Both Smith and Marx thought that the value of gold was based on the amount to labor to obtain it. This, despite Marx being aware of a study that showed mining costs to be higher than the values assigned to the money. Consistent with their materialistic view of money they failed to recognize the legal nature of money as well.
“Money exists not by nature but by law.” Aristotle.
Marx was also a journalist and was for a time the London economic correspondent for the New York Tribune. The image of Karl Marx as a socialist revolutionary opposed to democracy arose largely as a product of later propaganda. As the merchant economist praised by both Maynard Keynes and Irving Fisher in the 1930s, Silvio Gesell noted, Marxism was a divide and conquer strategy of the capitalist financiers, that it was popularized to drive a wedge between labor and the industrialists to distract them away from the real culprit behind both of their problems, the capitalist monetary/finance system.
However, as a friend of mine noted, it is important to “differentiate between Marxist diagnosis and Marxist therapeutics, the first one hitting the nail in many instances, and in the second one, missing the nail disastrously. Marx did well in graduating utopian socialism to scientific socialism, but that later the meaning of scientific got a second or third seat to ideological interpretations.”
As we have seen today, science has been politicized and put in service to maximizing corporate profits at any cost that could be externalized. If we are to have a strong, stable and sustainable economy this will have to change. Mammon will have to be ostracized.