Money is just a token that we use to “keep score” of the debts we owe one another. It is just a unit of account that helps us keep track of who has given who what. Having a central quasi-governmental power in the form of a central bank simply helps us to do this and allows governments to extend deficit-financing in order to keep economic activity stable.
So, what accounts for the visceral reactions we see toward the system? Why do some bow down as if to a deity, while others recoil in horror as if confronted with a demon? The hint to this lies in the way we moderns relate to government and power. The fiat money system is an embodiment of arbitrary power and we in the modern world distrust this. Money is accepted largely by edict in that it is fiat money in which we can pay our taxes and it is also fiat money in which contracts can be legally settled.
Lying behind every dollar, euro and yen is a jailor and a judge who are ready to deprive us of our rights and our freedom should we choose not to play by the rules of the game. It is this aspect of the system that accounts for the strange reactions we see surrounding it. It is this aspect of the system that leads some to hide from themselves the reality of the system and imbue it with an auratic glow and leads others to hysterically attack it as a grave injustice and evil. To get to the heart of this matter we must understand better how we relate to political power today.Naked Capitalism
Philip Pilkington: Kill The King – Why Are We So Scared of Fiat Money?
