At this point, it appears that I have finally mapped out the current extent of all known rivals to the Work-Standard’s Theory of Money (WTM). Compared to the Theories of Value, the Theories of Money have been easier to identify and catalogue for future reference. Most of the commonly known Theories of Money to my knowledge have been discussed in form or another on The Fourth Estate. Every discussion of them included a critique, followed by a discussion about why the Work-Standard has functions distinguishable from its rivals. Currently, the opponents of the Work-Standard’s WTM are:
- Commodity Theory of Money (Bimetallism)
- Credit Theory of Money (Chartalism)
- State Theory of Money (Chartalism)
- Quantity Theory of Money (Keynesianism & Monetarism)
- Modern Monetary Theory (related to Credit and State Theories of Money)
- Debt-Free Fiat Currencies (related to Credit and State Theories of Money)
- Cryptocurrencies
- Time-based Currencies
Cryptocurrencies, based on how they were conceptualized, represented an outgrowth of the Commodity Theory of Money. Time-based Currencies, meanwhile, are derived from those 19th century Utopian experiments that tried to base a Currency around Zeit itself. I still cannot fathom why there are still people today who remain convinced of its feasibility. It is in respects related to my disappointment with Marxism lacking a unified Theory of Money that best complements the Labor Theory of Value (LTV).
There is another Theory of Money that I have yet to discuss here and it has something to do with my discussions of Fordism-Taylorism in The Third Place. Everyone who has read that treatise will know that the “Fordism” in Fordism-Taylorism is in reference to Henry Ford, the man behind the Ford Motor Company. Interestingly, Ford did propose his own alternative currency that would embody the production processes of Fordism-Taylorism.
Ford was a known critique of Bimetallism, believing that the Gold Standard had contributed to the onset of the First World War. He suggested that instead of replacing the Gold Standard with the “Debt Standard” of Fiat Currencies, the alternative should be an “Energy Currency.” The argument posited by Ford was that by introducing the Energy Currency, there would be fewer wars waged by governments. This Currency would be backed by a fixed amount of electricity per kilowatt hours (kWh). The more electricity consumed, the more valuable the Currency becomes. It is noteworthy that Ford meant electricity consumption as opposed to electricity production because proponents of Cryptocurrencies have interpreted his statements to imply that he had anticipated the rise of Bitcoin a century earlier during the 1920s.
The reason why Ford never succeeded in implementing it was because he was specifically counting on acquisition of the Muscle Shoals Dam in Tennessee. Since he defined the Energy Currency’s Value in terms of energy consumption, he needed access to its energy production capabilities. And because he never succeeded in bidding for the government contract, Ford never got his chance to develop the Energy Currency concept further.
Aside from that historical proposal from Henry Ford, there is another variation of the Energy-based Currency concept that deserves mention here. Some critics of the Fractional-Reserve Banking System and Fiat Currencies have led to discussions about whether Currency could be backed by renewable energy production instead of non-renewable energy production. The proponents believe that Neoliberalism could not have sustained its worldwide hegemony without access to cheap sources of energy such as crude oil and natural gas. As Environmentalism and Climate Change are becoming key issues in 21st century political discourse, they have posited an Energy-based Currency whose Value would backed by renewable energy. Such a Currency would allow humanity to adjust to the conditions of Climate Change and Peak Oil whilst retaining some semblance of a national economy.
Compared to Ford’s conception, this particular version of the Energy-based Currency raises some important questions and implications. How do we go about gauging Currency Depreciation/Appreciation? If the Central Bank needs to devalue the Currency, would that entail raising renewable energy production and vice versa in the case of revaluation? Can we make some important value judgements between the different forms of renewable energy?
That third question is an important one. Renewable energy can come from a variety of sources ranging from wind power and solar power to hydroelectric power and geothermal power. Given the current direction of Environmentalist movements around the world, nuclear power in general has already lost enough credibility that it would not too difficult for me to imagine its valuation being on par with natural gas and crude oil.
Arguably the biggest distinction that sets the Energy-based Currencies apart from the Work-Standard is that too much emphasis is placed on the State. Our average Self within the State of Total Mobilization does not possess the production capabilities of a hydroelectrical dam, a geothermal plant, or an electrical power substation. Most energy production facilities are either controlled by large corporations, governmental bodies or some combination thereof. If anything, an Energy-based Currency might restrict the capabilities of the Self and the Totality as easily as the Gold Standard prior to the Great Depression and World War I.
A Work-Standard critique of Energy-based Currencies has yet to be written. That will definitely happen once I have gathered enough information about them and how it relates to the Sociable Currency posited in The Work-Standard and The Third Place.
Categories: Politics
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