Debt – David Graeber

Debt – Updated and Expanded: The First 5,000 Years

Author claims that credit systems arose much before the rise of money. Money was typically used to finance wars, as a way to feed soldiers and to be able to pay them while they were on the road.

For every belief or value system we take for granted in the western world, there are different value systems in other parts of the world. The Tiv women believed in communal giving, a woman would give a house a gift, and you had to pay back that gift with another gift of same value or higher. The cycle kept going on.

Another example from a different community – if you saved someone’s life, you basically ‘owed’ that person and he could come to you asking for gifts.

Chinese tradition – you owed a milk-debt to your mother for the milk she provided you at birth.

Hindu tradition – society divided into classes, the brahmin classes were the ones who owed their debt to god and roughly symbolified that everyone below owed their debt to the class above their own. Concepts of Karma etc. introduced as a way to symbolify debt.

Spanish Conquistadors was an example of the invaders who were actually ruined by debt by the creditors who financed the wars. Eventual debt led to their decline.

Author argues that family living is based of communism – people caring for each other. But societal living is currently capitalism. Author is strongly anti-capitalistic, and makes the point that a lot of capitalism was based of debt peonage. And throughout history, debt peonage was enforced by violence and holding people at gunpoint to sign debt contracts. Also believes that speculative behaviour rampant in capitalism will lead to it’s downfall and that we are on the brink of something yet to be determined.

While the author makes a lot of interesting historical points about the rise of money and how credit systems existed long before money grew, the strong anti-capitalistic sentiment in the end is where the book breaks down a bit. Capitalism does have a directional view of the flow of money from rich, idle creditors to the industrious poor. Graeber makes the argument asking about the non-industrious poor, and what they stand to gain in capitalism.

I do agree that capitalism enforces a single minded view towards the creation of ‘value’ resulting in wealth. However, I am an optimist and I see the technological progress and improvement in life we have achieved over the last 200 years. Just 30 years ago, we did not have the internet. And capitalism does stand to gain credit for a lot of those achievements, and has evolutionary basis for improvement of things. And that precisely, can be brutal. I do see that it does not work for everyone, but it has been working on aggregate. Perhaps we will find a better way to enhance sharing the spoils of victory with the larger society, instead of single mindedly rewarding the creation of value.