This book, by David Graeber, is great.  Provocative, brilliant; also crankish and infuriating.


Graeber is an anthropologist, and the best parts of the book are where he does anthropology. He’s devastating on what he calls the “myth of barter”. Economists love to talk about the invention of money as freeing us from the situation where Fred has arrowheads and Madge has pots, and Fred needs a pot, but they can’t trade because Madge doesn’t need arrowheads right now.

This doesn’t happen.  There was never a “barter stage”; no societies suffer from this hangup.  There’s a number of possibilities, but the basic pre-money mechanism is that Fred goes to Madge and says “That’s a handsome pot.”  Madge gives it to him.  At some later time, if she needs arrowheads, she goes and asks for some.  These may be considered tiny little debts, or they may just be considered the way social life works: people help each other out.

Once money exists, debts tend to be enumerated in units of account– but these are rarely transferred physically, and in fact the system long predates coins and even writing.  For 2500 years, Middle Eastern civilizations had markets, checks, traders, inns, interest, and debt without coinage.  Everything was done on credit.

Coins, according to Graeber, come in with large empires.  This developed out of the existing tradition that strangers are outside the credit economy.  Once you have a large standing army, you need to pay the soldiers, and they need to buy beer and horses and prostitutes.  As they’re rarely natives of the area they’re stationed in, it’s enormously useful to provide small portable bits of currency. It’s only in the last couple hundred years that this marginal coinage-based system took over the whole economy.

And then there’s debt.  As promised, Graeber gives a history of debt from ancient times, and in his telling it’s up to no good.  Debt always gets out of hand.  Ancient societies were plagued by a cycle of debt peonage: peasants would get loans; they were unable to pay the interest; they then sold off implements and furniture, then their fields, then their wives and children, and finally themselves.  Periodically, in the Middle East, kings would decree a vast cancellation of debts– all the records would be destroyed and the debt slaves would return to their restored homes.

In his telling, this process was linked to other bad things– such as slavery and misogyny.  Slavery was once limited largely to war captives, which were a limited resource; debt created a vast and increasing population who were effectively slaves.  Women in early Sumerian society were surprisingly visible and influential, and temple sex was a respected profession; the selling of wives and daughters to repay debts, and the subsequent sexual service, degraded the position of women.  And the fear of such selling-off led to the Middle Eastern focus on honor… meaning a man’s ability to protect his womenfolk, keeping them out of his creditor’s hands– and under his control.

And then there’s the moral effects.  Debt becomes a metaphor for the relationship of children to parents, or humans to gods.  We’re told to pay our debts, and yet most human cultures have despised usurers, and the first act of any peasant rebellion was to destroy the debt records.  Not infrequently kings or religious authorities took the part of the poor against their creditors, going so far as to ban interest or slavery… though these measures didn’t often last.

In the end, Graber suggests, debt– and economic theorists– blind us to how human societies really operate.  There are at least three types of human economy, which he calls communism, exchange, and hierarchy.  ‘Communism’ is the helpful, altruistic systems that underlie all human society– it’s how families work, and entire villages in many cultures, and even how corporations work internally.  Hierarchical exchanges are largely exactions by the rich and powerful, and their salient feature is precedent: a particular tax or tribute, once levied, becomes customary, which is one reason you should be wary of offering a gift to the king.  (On the other hand, it’s rare that an elite simply does nothing but take; usually it needs to attract supporters by giving things away.)

To Graeber, economists go terribly wrong in ignoring or underestimating the non-exchange portions of the world.  The whole attitude of looking at the world in terms of rational, egoistic calculation is a vast misapplication of what was originally a very narrow part of the economy– associated with debt, war, and slavery.

All of this is fascinating and eye-opening, and can be used to deepen (and darken) your view of history, or your conworld.

At the same time… well, for Graeber history is full of villains, and he’s often so busy flinging mud at them that he loses track of who’s worse and who we should be rooting for.  E.g. he talks about the rise of coinage as something of a disaster, destroying the credit economy and ultimately turning the Roman citizens into slaves.  Yet he’s already shown that debt slavery functioned with its full horribleness in pre-coinage societies, and turned the Mesopotamians into slaves.  Later he provocatively suggest that the Dark Ages weren’t so dark, as the Europeans ended slavery, resisted usury, and ended the militarism of the Roman Empire.  But the Middle Ages, as he well knows, replaced slavery with serfdom, and threw out the political and technological advances of the ancients.

The last half of the book is a breezy retelling of history which grows increasingly polemical and tedious.  A particular low point is where he talks about the Iberian traders engaging in the arms trade, the slave trade, and drug trade, and a moment later explains that the “drugs” meant coffee, tea, sugar, and tobacco.  He’s often a bracing cynic and amusing contrarian, but this is just propaganda.

The last chapter, on the world since 1971, is a weird political diatribe of the Everything Is Horrible school.  He’s mostly mad at the US, and throws everything he can at it, no matter how contradictory: the US military is overwhelming, yet is easily resisted; the national debt can’t be eliminated, except it totally could if we didn’t spend so much on the military; the US oppresses everyone economically, but it was forced to grant favorable trading terms to Europe; buying US treasury bonds is a sign of empire, except when the Chinese do it.  Or there’s a bit where the US creates “a vast apparatus of armies, prison, police” to create an atmosphere of fear and jingoistic conformity… er, sorry, Dave, but those two things are pretty much opposites; people celebrating American power are not also afraid of it.  He even inserts charts to show how things are out of control!! with the propagandist’s tool of not correcting for inflation.  Plus his frequent references to “wage slavery” only cheapen his earlier discussion of real slavery.

As an anthropologist, he’s very good at criticizing the fantasy history that economists create; it doesn’t make him an expert on economics.

He’s also an anarchist activist, and was involved with anti-globalization protests, but he’s missed the biggest story of the new century: the fact that the Third World has become far, far better off.  He keeps asserting that capitalism can’t include everyone… and yet it seems to be doing just that.

The problem with a worldview where everything is horrible is that there’s no room for progress at all, including in the future.  A contrarian can point out truthfully enough that living standards stayed the same for most people– that is, on the edge of starvation– until about 1800. But even in that period there were advances, such as the abandonment of absolute monarchy, the rise of science, and the development of a vast array of progressive philosophies.  (The thing about idealisms is that somebody eventually will take them seriously… e.g., you pass a Bill of Rights and then, a couple centuries later, courts start to make it real.)  Plus, even in Graeber’s own telling, not infrequently the authorities found it useful to cancel debts, repress usurers, or free serfs.

And after 1800, it’s hard to deny (though Graeber does his best) that the average American is better off than the average Babylonian.  Knowing more about the world helps; tamping down the claims of kings and priests is valuable; rural villages don’t seem like such paradises to the people who live in them.

Graeber likes to detail how many of our institutions arose in war, debt, and slavery.  And they did!  However, things don’t remain forever tainted because of their bad origins.  He’s fond of pointing out that governments went into debt and issued coins and taxed people largely to finance wars, and that a huge portion of US spending is still military.  But it’s now far from the majority of spending– most government spending is education, roads, social security, health insurance. and so forth.

(The problem with criticizing an Everything Is Horrible person is that some people will get the impression that I’m instead saying that Everything Is Great. It’s not, of course. I understand the impulse to think that the whole system is rotten and has to be thrown out. But sometimes our impulses aren’t so smart. Throwing the whole system out rarely goes well.)

After all that, I should emphasize that I don’t disagree with all of his cynical remarks.  He’s pretty acute, for instance, about the disaster of neoliberalism… the insistence that with every crisis, Third World governments implement “reforms” that favored First World creditors and clawed back social progress for the poor.

He doesn’t say much about what he’d like to do instead; but in his concluding section he does make a practical suggestion: cancel debts!  And he has a point.  High-debt systems generally lead to reforms that do just that; the irony is that under the current plutocratic system, rich debtors get government relief and poor debtors are screwed.  As he points out, we’re trained to say “People should pay their debts!”, and never to ask why people get so far in debt and whether we really want that to be the system we live under.