In Eugen Rosenstock-Huessy's, The Origin of Speech, Rosenstock postulates a significant difference between pre-formal, informal, and formal speech.
He calls pre-formal speech the type of speech along the lines of "showing a man the direction to the next farm on the road, or stopping a child from crying." Pre-formal speech is the same as animal speech, the human version.
Of informal and formal speech he says, "Informality is a rebellion against formality. Never can 'informal"be called pre:-formal. To be informal means to neglect forms which exist." He illuminates these differences to show that the progression of language is NOT pre-formal to informal to formal. Rather, pre-formal is a different thing altogether, and formal speech must exist before informal.
So what does language have to do with money? Maybe nothing. But maybe money works the same way. What if currency is the formal language of exchange? Language itself is an exchange between multiple parties through a shared context. So it is not so far-fetched to see money belonging to the same category.
The Native American tribes did not have money. They valued things, they had trade, but they did not have money. For century upon century their economy would be described as pre-formal. We might wonder why they never developed a formal currency. But if Rosenstock is right then pre-formal cannot develop into formal. Formal comes first. The history of wampum currency in northeast America suggests a formalization upon the arrival of Westerners in the 1600s.
Rosenstock asserts that for formal speech to exist first, as he contends it must, formal speech must be spoken into the world that doesn’t have it from outside. He would contend that formal speech was initiated and taught to humans by God, and I would agree. If formal money works the same way then this too would have to be initiated and taught to humans by God. The Bible doesn’t explicitly describe this moment. Money isn’t referenced until after the flood. But Genesis 2 does mention lands of precious metals and stone in a curious way.
Speech is not static. It evolves and transforms over time. Yet it would be without meaning if it also wasn’t fixed. Formal speech is much more fixed than informal speech. Two ways of guarding speech is through ritual and through the written word. Ritual speech and writing makes speech exists in history in a tangible and reference-able way. These become the foundations upon which more formal speech, and the other forms of speech develop.
What is money then? What are the formal foundations that formal money exchange, and the other forms of exchange develop upon? We know that money, like speech is not static, that it evolves and transforms over time. There has always been inflation and deflation. But what is the formal money that exists in history behind it all, the thing that keeps it stable, the tangible money that exists in time and space and is the foundation for economies?
Modern economies have developed a formal currency upon mutual agreement. The elastic nature of money is artificially (and some would say nefariously) managed by authorities and institutions so that the everyone keeps to the mutual agreement. It is tempting to deny this as being true money. It might be best described as an informal currency masquerading as formal. As such it is true money, but fundamentally temporary. Our money today is much like a language once rich in the written word that has burned all its books. Eventually it will become meaningless and smaller groups will rebuild formal structures upon new foundations.
I find the analogy of money and language demonstrating common traits interesting. On many levels money can act as a method of communication and I would agree that they share many similarities.
ReplyDeleteHowever, I think that your premise uses money and currency interchangeably and that is leading to a clouded conclusion that money is a cultural phenomenon that ebbs and flows with time and space when actually the money is the constant and it is the currency that changes. There is no doubt that several types of currency have been used over time. In your example looking at the Native American economy you made the initial conclusion that they did not have money until the introduction of the Westerners, which they then adopted the wampum. This transfiguration represents a change in currency not a change in money. Even in their trading they used money, just a primitive version.
Currency is the culturally adopted method of exchange. In our current word that may be U.S. Federal Reserve Bank Notes or the Euro or the Peso. Money is the payment for goods and service irrespective of the currency used.
While all currency is money (debatable, but I will ignore that for now), not all money is currency.
The parallel in your analogy would be that all language is communication, but not all communication is language.
No doubt that over time we have developed more and more complex and sophisticated currency methods, but I do not think the characteristics of money have actually changed.
I agree that language and currency have much in common, but I am lost when that imagery is applied to money.
Thanks for the comments. Looks like I did not do enough to clarify terms. I probably should have avoided using the word currency altogether.
ReplyDeleteIn reference to pre-formal money, This would be trading and other types of exchange without reference to formal money. Trading cards with my friends as a 7-year old would fall into this category. After discovering price guides most of my trades would belong in an informal category. These trades are a whole new thing because they are a improvisation from formal money, even though it looks much the same. Native Americans valued wampum and used it in trade before westerners arrived, but as pre-formal money. But Westerners spoke formal money into that world and turned wampum into formal money.
This was offered as a proof that Rosenstock's equations about language are true of money as well.
If the part about pre-formal and formal is correct then it might follow that his thoughts on formal speech originating from outside the system, being spoken into the system, is also true of money. If this is the case then money, as dynamic and complex as it can be, has a fundamental foundation upon something fixed. It's "it-ness" has an existence apart from the system. This relates to what you said about money having "inherent value."
From this foundation money can have new formal expressions as well as informal expressions. Gold and silver backed dollar bills would fall into the formal category, credit is debatable, trading baseball cards according to a price guide would be informal.
The concluding point is very similar to the one you made about the dangers having fiat money. If Rosenstock's view of speech works for money, then a system of money that abandons its formal character and builds its system upon its own self cannot survive (placing informal expressions in the place of formal ones). Specifically, if it falls, and it will, it will not be able to revive. New money, with a foundation on formal money, will be required for a new working system.