The Memory Bank

On money and method in anthropology

October 17, 2006 by Keith Hart

Introduction

This paper started out as an attempt to study the euro from an anthropological point of view; but it has ended up being more about anthropological method and money in general. Even so, a focus on the new European currency leads me to ask how we might study transnational or even global phenomena like this and still call ourselves anthropologists. For when ethnographers are not restricting their research to fieldwork in a particular place, they still tend to be limited in scope to working in one country. Social anthropology was once remarkable for the unity of its object, theory and method; but this disappeared along with “primitive” societies. Anthropologists still cling to “fieldwork-based ethnography” as their professional calling, but the study of money needs more than this. I propose as anthropology’s new object the making of world society, adopting provisionally an eclectic approach to theory and method. Anthropologists must appropriate both common knowledge and that of other specialists, if we are to identify the “historicity” (Foucault, 1973) of our own intellectual practices.

I approach the anthropology of money through four themes :

1. Money as memory, a meaningful link between persons and communities

2. Money as idea and object, the rise of virtual economy

3. Money as ‘heads & tails’, the impersonal expression of states and markets

4. Money as what people use it for, the potential for economic democracy

Following Marx, I conceive of ‘commoditization’ as a historical dialectic of social abstraction that is closely linked to the rise of money as a universal social principle. If we do things for each other in society, these services have to be separated from what we do for ourselves. This process draws us into ever-widening circles of interdependence based on calculated exchange. The money circuit is becoming detached from production, trade and politics. I ask if the euro is something new or a throwback to older forms. In future people everywhere will issue their own money instruments. Meanwhile, the euro’s movement in history offers a glimpse of where world society is heading. Money is a suitable strategic focus for anthropological study of that society.

Money and method

My first attempt to approach money as an object of anthropological enquiry was a lecture given two decades ago (Hart, 1986). Malinowski (1961 [1922]) set a trend for anthropologists to dispute economic universals in polarised terms, juxtaposing exotic facts and western folk theories, without acknowledging the influence of contemporary history on their own ideas. My lecture had three parts which, taken together, constituted a method.

First, we should be more explicitly aware of the concrete conditions which stimulate our interest in some abstract problems rather than others. This means asking what it is in the world as we experience it that informs our researches, whether directly or indirectly. Second, it is no good taking potshots at vulgar reductions of economic ideas, when the intellectual history of western economic thought is itself extremely plural, even contradictory. A constructive reading of that intellectual history might have served Malinowski’s ethnographic analysis better than the straw man he chose to attack. Finally, when historical awareness and a more sophisticated intellectual apparatus are combined with our discipline’s standby of ethnographic fieldwork, the resulting anthropological analysis offers a more secure foundation for critical understanding of the world in which we live. (Hart, 1986 : 637).

So I first located the problem of money in contemporary economic history, arguing that state control of money was being undermined in the leading capitalist societies. Then I traced two strands of western monetary theory explaining money as a token of authority issued by states or as a commodity made by markets. These strands came together in the writings of Keynes (1930). But, rather than acknowledge the interdependence of top-down and bottom-up social organization (“heads and tails”), economic policy has swung wildly between the two extremes (“hands or tails?”). Last I showed that the token/commodity pair could inform a reanalysis of Malinowski’s ethnography.

Anthropologists have to be capable of comparing their exotica with a more profound picture of ideas and realities in the industrial world that sustains us. Conventional economic reasoning fails to enlighten us because it is so unremittingly one-dimensional. The coin has two sides for a good reason – both are indispensable. Money is at the same time an aspect of relations between persons and a thing detached from persons….Today’s effort is an act of bricolage rather than brokerage, formed from a vision of the anthropologist as a handyman who can help repair the damage done by professionals. (Ibid : 638-9).

Some anthropologists (e.g. Parry and Bloch, 1989; Foster, 1999; Guyer, 2004) have drawn on this framework for the purposes of a dynamic ethnographic analysis, without embracing world history or the theories of economists. In other words, the academic division of labour still reigns supreme and most anthropologists prefer to stay on familiar ground rather than risk being exposed as naïve interlopers on territory made familiar through common journalism or already colonized by experts.

In Closed Systems and Open Minds (Gluckman, 1964), an anthropologist and an economist explored “the limits of naivety” in social anthropology. They argued that anthropologists, given their pretension to address humanity as a whole, are obliged to open themselves up to the full complexity of social reality. At some stage they must seek analytical closure in order to draw simple patterns from these open-ended inquiries; and these abstractions may often seem to be naïve from the perspective of other disciplines. Gluckman had in mind the rich texture of ethnographic encounters, whereas I was suggesting that conjectural history, overthrown by fieldwork-based ethnography, should be rehabilitated, even if specialists can easily show the naivety of anthropologist’s accounts. Specialization can be an obstacle to the growth of knowledge; for specialists become prisoners of their expertise (Popper, 1997). Anthropologists have long enjoyed a certain intellectual freedom that can be invigorating for the more conventional sciences. We just have to be more explicit about how this comes about.

Foucault (1973 [1966]) ended his “archaeology of the human sciences” with some reflections on why psychoanalysis and social anthropology (ethnologie) “…occupy a privileged position in our knowledge”:

…because, on the confines of all the branches of knowledge investigating man, they form a treasure-hoard of experiences and concepts, and above all a perpetual principle of dissatisfaction, of calling into question…what may seem, in other respects, to be established. (1973 : 373)

[They] are not so much two human sciences among others, but they span the entire domain of those sciences, they animate its whole surface…[They] are “counter-sciences”; which does not mean that they are less “rational” or “objective” than the others, but that they flow in the opposite direction, that they lead them back to their epistemological basis, and that they ceaselessly “unmake” that very man who is creating and re-creating his positivity in the human sciences. (Ibid:379)

Foucault attributed anthropology’s originality to its being both “traditionally the knowledge we have of the peoples without histories” and “situated in the dimension of historicity”, by wh
ich he meant “within the historical sovereignty of European thought and the relation that can bring it face to face with all other cultures as well as with itself” (ibid : 376-7). He was sure the human sciences had reached their limit and this was doubly true of a discipline whose premises were being undermined by the collapse of European empire. Given the disappearance of the traditional object of anthropology, we have to find not only a new one, but also a theory and method appropriate to it. This means identifying the historicity of our own moment, as well as complementing ethnographic fieldwork with world history and humanist philosophy (Hart, 2003).

I propose that the object of anthropology should be the making of world society or the human universal. One name for this is “humanity”, at once a collective noun, a moral quality and a historical project for our species. Another is “the people”, whom contemporary ethnographers have studied assiduously in all their difference, but without much sense of what makes them the same. Anthropology’s object in the nineteenth century was world history, but this became discredited by its evolutionary racism. Before that, the liberal philosophers found speculation about humanity as a whole indispensable to the making of democracy. Kant (2006 [1798]) established “anthropology” as the scholarly name for this project. How might these older traditions be reconciled with the fragmented cultural relativism of twentieth-century ethnography? We should not repudiate the revolutionary principle of joining the people where they live in order to find out what they think and do. Contemporary anthropologists have justly celebrated cultural variety in the here and now; but they have neglected longer term perspectives on human history and have privileged collective norms over the personal experience of individuals.

In addition to drawing on the historical sequence of paradigms for anthropology, I would add the existentialist or romantic quest for understanding how individuals make sense of their relationship to the human predicament in general (Hart, 2003). Humanity is after all facing a highly uncertain future affecting all life on this planet; and we are increasingly aware that each of us is a unique personality with the chance to make a difference. Such a focus could be labeled “self in the world” or “subjects in history”; and it should lead anthropologists to take a greater interest than before in biography, autobiography and fiction.

Each of us embarks on a journey outward into the world and inward into the self. We are, as Durkheim (1965 [1912]) said, at once collective and individual. Society is mysterious to us because we have lived in it and it now dwells inside us at a level that is not ordinarily visible from the perspective of everyday life. Writing is one way we try to bring the two into some mutual understanding that we can share with others. Ethnographic fieldwork, requiring us to participate in local society as we observe it, adds to our range of social experience and brings lived society into our sources of introspection. One method for understanding world society would then be to make an ongoing practice of trying to synthesize these varied experiences. This is to some extent what I attempted in The Memory Bank (Hart, 2000).

I asked there what future generations would consider distinctive of our times and came up with the digital revolution in communications, manifested as the rise of the internet in the 1990s. The half-century begun by the anti-colonial revolution had seen the formation of world society as a single interactive network. How was the digital revolution affecting the forms of money and exchange? I concluded that the impersonal conditions of personal economic agency were shifting in profound ways (see also Hart, 2005).

I had previously written a draft of a text-book showing how anthropologists can and do address the economic institutions of modern society. But I rejected this effort because it was too impersonal. I could not identify myself in it. I based the successor volume on personal memory – on my own teaching and research over three decades and especially on my own encounters with the economy as a gambler, journalist, consultant, publisher and academic entrepreneur. The idea of a memory bank comes from computing; but banks are also where money is kept. I came to see that the two great memory banks, language and money, were converging as information in the internet; and of course the book itself was my memory bank. Soon afterwards I developed a website for the diffusion of my writings under the same name (www.thememorybank.co.uk).

There are as many worlds as there are individuals and their journeys. This could be our starting point; but it will not do for the study of world society. For this anthropologists need to enter the objective world of money, markets, digital communications, ecology, cities, population statistics, trading blocs, nation-states, corporations and networks, all the while risking exposure of our professional naivety. Making a better society also means using the imagination for purposes of fiction, the construction of possible worlds out of actual experience. Thinking about the macrocosm is made easier through contemplation of microcosms. Novels and movies compress the world into a narrow format that we enter subjectively on our own terms, allowing us to make a meaningful connection with history. In the past, human universals have sought to extinguish or dominate the cultural particulars through which human beings live. The principle of the new universal is, I believe, already revealed to us in great literature. It is that human universals must not just tolerate cultural particulars, but can only be realized through them. Thus, the most creative writers reach general truths by digging deeply into particular places and personalities. This has always been the great strength of ethnography.

The success of British social anthropology in the interwar period derived from the unity of its object, theory and method (Hart, 2004). The object was “primitive societies”, far-flung peoples of the empire encountered in the here and now. The theory was “functionalism”, the idea that customary practices, however bizarre, make sense and fit together, since daily life would be impossible otherwise. And the method, as their successors repeat in an unchanging mantra, was “fieldwork-based ethnography”, joining people where they live to find out what they do and think, then writing it up in universities back home. Even if I consider that anthropology has one ultimate object (to study and help create world society), I have been compelled to make a virtue of being methodologically and theoretically eclectic. Like many of my contemporaries, I have been drawn into the long struggle to reinvent our discipline in the face of post-colonial realities. Studying money has become for me the object and means of this re-invention.

The anthropology of money: some themes

(a) The meaning of money

The word money comes from Moneta, whose temple in Rome was their mint. Moneta was the goddess of memory and mother of the Muses. Her name was derived from the Latin verb moneo whose first meaning is “to remind, bring to one’s recollection”. For the Romans, money was an instrument of collective memory that needed divine protection, like the arts. It was both a memento of the past and a sign of the future.

Money’s prime function could thus be said to help us keep track of those exchanges we wish to calculate. But a lot more circulates by means of money than what it buys. Money conveys meanings and these tell us a lot about the way human beings make communities. Money expresses both individual desires and the way we belong to each other. In this i
t resembles language, the other great means of communication (Hart, 2007b). How do meanings come to be shared and memory to transcend the minutiae of personal experience? Memory was central to Locke’s philosophy of money (Caffentzis, 1989 : 53). For him property belonged to a person who made it his own by performing labour on what nature gave humanity in common. But for a claim on property to endure, that person has to remain the same; and this depends on memory. So money helps us to stabilize personal identity by holding something that embodies the desires and wealth of all.

Communities exist by virtue of their members’ ability to exchange meanings that are substantially shared between them. People must understand each other for practical purposes. And that is why communities operate through culture (meanings held in common). Money is an important vehicle for this collective sharing as well as for the differentiation of individuals by wealth and status.

Communities operate through implicit rules (customs) rather than state-made laws. In the nineteenth century, few believed that the state, an archaic institution of agrarian civilization, could govern the restless energies of urban commercial society. Accordingly, “primitive” communities were studied to throw light on the task of building modern societies along democratic lines. After the First World War, the modern state was seen as inevitable and small-scale alternatives became irrelevant. But now large states are in disarray. The word is out for devolution to less rigidly organized “communities”. Market networks seem to offer more direct access to the world at large. Cheap information allows relations at distance to be made more personal. So we have to rethink how societies can best be organized for their development.

The meaning of money is that each of us makes it, separately and together (Hart, 2006). It is a symbol of our individual relationship to the community. This relationship may be conceived of much as in existing states — as a durable ground on which to stand, anchoring identity in a collective memory whose concrete symbol is money. Or it may be viewed as a more creative process, allowing each of us to generate personal credit linking us to multiple forms of association. But few people are ready to accept that society rests on nothing more solid than our transient exchanges.

(b) Money as idea and object

Keynes (1930) held, against the myth that traces money to the barter of commodities by savages, that states invented money. He distinguished how purchasing power is expressed (“money-of-account”) from the currency that is actually held (“money-proper”, what Dodd (2005) calls “the monetary medium”). These are money’s insubstantial and substantial forms, respectively. It was thus always both an idea and an object; we might say, virtual and real. The convenience of using money for exchange on the spot seemed to Keynes less important than the emergence of a money standard named by law. Moreover, the acknowledgment of private debts (“bank money”) has long been used to settle transactions expressed through the money of account.

Modern state money is currency of little or no worth offered to a people by their government in payment for real goods and services, with the obligation to pay taxes on all transactions using the sole legal means of exchange within the territory. Central banks jealously guard the national monopoly, policing the banks who actually issue most of the money. Most currencies today are a hybrid between commodity-money (based on gold for example) and fiat-money (paper money). From the beginning, states and markets were symbiotic. Rulers needed the revenues from taxation of trade and some imported commodities as symbols of power; merchants needed the protection of law and the establishment of a public standard. Each excluded the possibility of society being conceived of as persons belonging to particular communities.

(c) Heads or tails?

The coin has two sides (Hart, 1986). One contains a symbol of political authority (heads); the other tells us its quantitative value in exchange for other commodities (tails). The two sides are related to each other as top to bottom. One carries the virtual authority of the state; it is a token of society, the money of account. The other says that money proper is itself a commodity, lending precision to trade; it is a real thing.

Victorian civilization based its market economy on money as a commodity, gold. For much of the twentieth century, under Keynes’s influence, political management of money was normal. Now there is talk again of “the markets” reigning supreme and of states losing control over national currencies in a process of globalization. Yet the evidence of our coinage is that states and markets are or were each indispensable to money. What states and markets share is a commitment to founding the economy on impersonal money. If you drop a coin and someone else picks it up, they can do exactly the same with it. This absence of personal information from the currency is what recommends cash to people who prefer their transactions to be invisible. But economic democracy requires people to participate in exchange as themselves, not just as the anonymous bearers of cash.

What if money came from the people instead (Hart, 2006)? The German romantic, Adam Müller (1931 [1816]) thought money expressed the accumulated customs of a nation (Volk); while Simmel (1978 [1900]) and Mauss (1990 [1925]) conceived of money as an expression of trust within civil society, locating value in personal management of credit and debt. In the age of digital communications, other possibilities present themselves. If money is a measure of transactions, it might even become more meaningful than it has been of late.

(d) People’s money

The bureaucratic power of states rests on coercion. Revenue collection, both public and private, depends on the authorities being able to force people to pay through the threat of punishment; and territorial monopoly is indispensable to both. This, for all their conflicts of interest, underlies the continuing alliance between large corporations and national governments. Will borderless trade at the speed of light permit governments and corporations still to compel payment of their dues? Contemporary conflicts over intellectual property hinge on this question (Hart, 2005).

How might public economies be organized without effective means of coercing payment? Some Swiss cantons have recently released their stock exchanges from government supervision, because the threat to punish offenders was idle. Exchanges were asked to draw up their own rules with the sole sanction being to exclude transgressors. With the erosion of territorial power, people will have to turn to more informal means of regulation within their own forms of association. The forms of money and exchange are likely to be no exception.

Modern bureaucracy, as embodied in law, markets and science, has undermined the meaningful attachment of persons to the social order. So, when bureaucracy fails, the means of personal connection will have to be reinvented. There are many antecedents for building communities on the basis of individual members’ moral and religious commitment. The growth of NGOs financed by charitable donations supports this point. Mauss (1990 [1925]) was far-sighted when he traced the origin of the modern economy to the gift, rather than to barter.

Mauss’s emphasis is consistent with the idea of money as personal credit, linked less to the history of state coinage than to the acknowledgement of private debt. Our need to keep track of proliferating connections with others is mediated by money as a means of collective memory. People will increasingly enter circuits of
exchange based on special currencies. At the other extreme, we participate as individuals in global markets of infinite scope, using international moneys of account (such as the euro), electronic payment systems of various sorts or even direct barter via the internet.

It is a world whose plurality of association will resemble feudalism more than the Roman Empire. In such a world, one currency cannot possibly meet all the needs of a diversified region’s inhabitants. The shift to ever more intangible versions of currency — from metals to paper to bits — has exposed the limitations of central bank monopolies. In response, people have already started generating their own money in the form of a variety of community currencies often using sophisticated electronic payment systems (Hart, 2006).

Even when they don’t issue their own money instruments, people do make their own social uses of it. Zelizer (1994; 2005) argues that monetary flows are best approached through understanding the social practices of ordinary people. This too is the dominant perspective of Parry and Bloch’s collection, Money and the Morality of Exchange (1989). The anthropology of money must build on this perspective, since economic democracy has its origin in such practices. But I have been concerned mainly with the prospects for people to make money rather than take it for their own ends.

Commoditization: the dialectics of social abstraction

One common strand informing these several lines of inquiry into money has been Marx’s analysis of the historical relationship between people, machines and money in Capital. People ought to control machines and through them money, to be distributed in the general interest; but it is the other way round — money controls the machines and the people, with unequal and often socially disastrous results. Our political task is to reverse this situation. His book was a means to that end and he began it with the famous chapter on “commodities” which deserves our close attention, especially the opening section : “The two factors of a commodity: use-value and value (the substance of value and the magnitude of value)” (Marx 1970 [1867] : 35-41).

Marx defines the commodity as a useful product of labour which, by means of social abstraction, is endowed with value in exchange. In an earlier article (Hart, 1982), I sought to improve on this definition, first by making the historical dialectic more explicit and then by taking up developments since Marx’s time. I recast the commodity as a process, “commoditization”, defined as “the progressive abstraction of social labour”. When we do things for each other in society, these services have to be detached from what we do for ourselves. This process of abstraction draws us into ever-widening circles of interdependence, the most inclusive of which are exchanges using money.

The commodity is progressively (but not necessarily in a historical sequence):

1. Some useful thing external to the producer;

2. Made social by becoming available to outsiders;

3. Specialisation extends exchange to an inter-community level;

4. Sometimes persons circulate, not things (e.g. marriage exchange);

5. Products of socially divided labour are circulated by means of gift-exchange, barter or payments of rent;

6. This may be elaborated as markets, exchange at negotiated rates, not the gift;

7. Then special- and general-purpose monies enter into the circuit of exchange;

8. Money is the commodity crystallized as pure exchange value (Marx);

9. Now money can take the form of capital to make profit;

10. Eventually “industrial capital” employs human labour, as opposed to finance and merchant capital;

11. Passing beyond Marx’s time, services come to outweigh goods in the world market (things are replaced by what people do for each other);

12. Now commodities are often ideas and work for society is recognized as wholly abstract ciphers; money is information flying around cyberspace as bits;

13. The world market for money is dominated by derivatives – secondary contracts that gamble on the future prices of commodities actually bought and sold;

14. But people still do many things for themselves; make gifts; use old-fashioned cash; join computerized barter networks etc.

This is, of course, a bourgeois just-so story; but it is based on Marx’s and it does illuminate a basic trend that he predicted, the apotheosis of capital as money exchanged for money in a pure form detached from what people do. It is consistent with Mauss’s (1990 [1925]) argument that gift-exchange and market contracts rest on a shared logic of reciprocity; but not with the opposition between “gift economies” and “commodity economies” that animates so much anthropological discussion today (Gregory, 1982; 1997 : chapter 2; Hart, 2007a).

In his introduction to Grundrisse (1973 [1859]:100-108), Marx states that we must start from the concrete conditions of our moment in history and then draw some analytical abstractions from them. Some are content just to achieve abstract ideas; but for Marx the point is to insert these simplified abstractions back into their concrete starting-point. Yet he opens Capital with this abstract discourse on “commodities” and the three volumes never get to where he was aiming for in Grundrisse, “the world market and its crises”.

Both Marx (1970 [1867]) and Simmel (1978 [1900] : chapter 6) noticed that social abstraction through capitalist markets seemed to go along with intellectual abstraction as philosophy and science in ancient Athens, Renaissance Florence, England in the seventeenth century and, we might say, the USA in the twentieth. But we should not lose sight of the dialectics involved. The commodity remains something useful and in that use lies its concrete realization. The reality is the mutual determination of the abstract and the concrete and our method has somehow to reproduce that.

We rely on the products of abstraction to engage with others in highly concrete ways; and information-based trade in commodities and money allows us to interact with increasing specificity at great distances. Thus I once had a service contract for my website with a firm in Bangalore, India. I could talk to the webmaster there by internet telephone, while he showed me various design possibilities through our browsers– all in real time and at no cost. This is getting close to what we could do to if we were in the same room together. Working with a PC will be a lot less lonely in future.

The digital revolution in communications is as radical as any in human history, comparable to the invention of agriculture (Hart, 2000, 2005). The internet went public only a dozen years ago and the basic technologies were invented in the mid-twentieth century. We are like the first digging-stick operators who stumbled into a revolution whose culmination thousands of years later in Chinese agrarian civilization was unimaginable to them.

A case study: the euro

The euro is, with the US dollar, an example of the “homogenization” of money in recent times, the tendency for currencies to become more alike and for national currencies to take shelter with a global one (Dodd, 2005). As a very recent experiment, it lost 20% of its value against the dollar when it was only virtual (money of account), regaining more than that after its launch as notes and coins (monetary medium), only to slide back in 2005 and recover in 2006. With the dollar’s role as world currency coming under increased pressure, the euro offers one of the few alternative refuges for the free flow of capital worldwide.

The European Union is the most dynamic political experiment in the world, with its rapid enlargement giving rise to intense debate over economic policy. The French and Dutch rejection of the new constitution revealed a popular concern that European governance is too remote, elitist and bureaucratic. I see the European project as an antidote to reactionary nationalism; but it could surely do with being more flexible and accountable. The “no” votes highlighted the issue of Europe’s “social model”, specifically of its ability to withstand the neo-liberal world economy. The monetary union agreed at Maastricht is too rigid and the Dutch in particular found they had imported inflation with the euro, partly because the governments of larger countries overspent their limits to shore up depressed economies. Some Italians, faced with Asian competition for their manufactures, now express nostalgia for lira devaluation.

As European and American foreign policy have diverged since the end of the Cold War, this has led to growing public discussion of their respective economic models. Market liberals see only decadence in Europe and a euro that was a dead duck before it even got started. Some American radicals, on the other hand, claim that Bush invaded Iraq because Saddam was switching his oil money into euros. In the meantime, no-one knows how long Japan and China will finance the USA’s trade and budget deficits nor what will happen to the world economy if they sell off their dollars. The rise of the so-called BRIC countries (Brazil, Russia, India and China) as producers of agriculture, minerals, manufactures and information services is the biggest shift in global capitalism since the USA and Germany challenged Britain’s commercial ascendancy a century ago. A focus on the euro is a way of simplifying this complex situation. That is after all one of money’s principal functions. So is the euro a new form of money and what difference has it made so far?

An editorial in Libération, of 1^st January 2002, celebrated the euro as a revival of the spirit of the Roman Empire under the heading “Rubicon”:

La marche de César sur Rome fut l’acte fondateur d’une Pax romana qui étendit son empire plusieurs siècles durant d’un bout à l’autre de l’Europe, garantissant au continent prospérité et civilisation. Les Européens n’ont jamais tout à fait perdu le souvenir de cet âge d’or….L’euro, véritable icône de l’Union européenne, est une nouvelle réincarnation de l’éternel projet d’unité d’un vieux continent hanté par sa longue histoire de conflits sanglants… (p. 3)

Moneta returns to claim her cultural legacy and a newspaper of the left temporarily abandons its republicanism to invoke the idea of empire. If money is memory, then the euro provokes very long memories indeed, as well as a degree of amnesia. Whatever we may think of Rome’s political system, the promise of overcoming the fragmentation of European sovereignty inherited from feudalism is indeed the huge symbolic prize conferred by monetary union. The EU is a community, not a state; and its founding principle of “subsidiarity” ensures that there is room for many levels of community underneath. Ironically, by suppressing their own national currencies, some countries may encourage the formation of parallel exchange circuits, employing virtual deutschmarks or francs as community currencies. There is scope for less inclusive monetary instruments to complement the euro. After all, the identity of the French is hardly erased by a currency that crosses borders.

Has the euro made any difference to the personal memory of individual Europeans? Their travels between member countries have been simplified, but not much else has changed. In most respects the system of banking remains the same and this reflects the conservatism of Maastricht and of the European central bank it eventually created.

The technical form of money is becoming ever more insubstantial — from precious metals and ledger entries to paper notes and electronic digits. In the process money is revealed as pure information and its function as an accounting device (money of account) takes precedence over its form as circulating objects (the monetary medium). The euro began life in a wholly virtual form, without an objective existence as currency. Since money futures markets were invented in 1975, international exchanges of money no longer mainly pay for traded goods and services, but rather consist of money being exchanged for money in another form. In this way the money circuit (known as “the markets”) has become almost wholly detached from real production, trade and political management.

In this world of runaway intangibles, the arrival of the euro notes and coins in January 2000 had a tangible objectivity. The banks of course still create over 90% of all euros in the form of paper loans (or more often as bits in cyberspace), but the actual currency was seen to be a symbol of a new political era. Almost all suppliers took advantage of the switch to round prices upwards. Otherwise, since the participating national currencies had been linked together within EMU for a decade, the euro has made little difference to people’s experience of money either as an idea or as an object.

What about “heads or tails”? Has the euro altered the balance between states and markets? The euro may not be a national currency, but it does aim to be federal, like the dollar, and the twelve participating countries represent in effect a league of states. Joining a larger currency bloc is a way of trying to cope with “the markets” — the global tide of virtual money that threatens to swamp the independence of national economies. But the euro is still a form of state money and its management is likely to be even less democratically accountable to the public than its national precursors. The euro is in principle a throwback to the Bretton Woods era of fixed parity exchange rates; and it does not take much imagination to figure out that some parts of the European economy will suffer from its rigidity. At least the euro coins have generally dispensed with the heads of rulers.

The economic destiny of 300 million Europeans is now tied to the fortunes of a single currency whose management cannot possibly meet their varied needs and interests. If government of modern societies from a fixed central point has always been anomalous, this is even more likely to be true of Europe in the near future. Its constituent states will come under pressure from their own people for more flexible instruments of economic management. The euro cannot do the job all by itself. National monopolies of money have in any case only been around since the 1850s. Now would be a good time to recognize the need for a variety of monetary instruments, for as many in fact as our communities.

Is the euro a step towards money that better reflects the interests of people in general? The technical forms of currency are relatively insignificant — notes, coins, cheques, ledgers, plastic, digits — and the euro embraces them all. The form of the money of account is more important and, after several thousand years of state money linked to markets for scarce commodities (Keynes, 1930), it will take some effort to embrace another form, people’s money. Territorial states are an anachronism today. Digitization encourages a growing separation between society and landed power. The euro involves only a limited break with the territorial principle. Its logic is still that of a central bank monopoly within an expanded territory. The national governments of Euroland are likely to be more constrained in their ability to raise taxes beyond the norm for the region. And of course, travellers throughout Europe will
be less subject than before to usurious exchange rates. But against this, the management of the European economy from a single fixed point will impose costs on regions ill-suited by the common monetary policy. And it is still the case that people will finance governments and the banks through the imposition of a monopoly currency as sole legal tender.

There are other democratic possibilities. We can make our own money rather than pay for the privilege of receiving it from our rulers (Hart, 2006). Already social experiments involving community currencies are breaking new ground, thanks to the possibilities inherent in the new information technologies. The next chapter of monetary history will be written by new approaches addressing the parts that the euro alone cannot reach. But the euro itself will probably be with us, well, for as long as European people think of themselves as a community for some purposes. Meanwhile its movement through our turbulent world offers us a glimpse of where human society is heading – perhaps to a totalitarian and fragmented future, but just possibly towards greater economic democracy and human unity.

Conclusion: money and the making of world society

The euro is the most tangible symbol of the European Union, but not co-extensive with it. For the last century or more, member states had supplied their citizens with a monopoly currency that served both as the reification of the national economy and as their principle link to the world market. The move towards political and monetary union in Europe is the most striking example of a general trend. Everywhere nation-states are coming together into regional trading blocs as one kind of response to globalization: NAFTA, Mercosul, ASEAN, ECOWAS etc. At the same time, many states have hitched their waggon to the sinking dollar. In the meantime, the sheer size and volatility of global money markets and internet commerce undermine the credibility of existing national polities as an effective bridge to world society. The international settlement after 1945 looks increasingly inadequate. Before long, calls for a world currency will become louder than at present (Frankman, 2004).

Money is a universal measure of value, but its specific form is not yet as universal as the method humanity has devised to measure time all round the world. It is a store of memory linking individuals to their various communities, a kind of memory bank and thus a source of identity (Hart, 2000). If you have some money, there is almost no limit to what you can do with it, but, as soon as you buy something, the act of payment lends finality to your choice. Money thus links us imaginatively and practically to the widest reaches of society, while lending precision to the fulfillment of our most concrete desires and obligations. Money’s significance thus lies in the synthesis it promotes of impersonal abstraction and personal meaning, objectification and subjectivity, analytical reason and synthetic narrative. Its social power comes from the fluency of its mediation between infinite potential and finite determination.

If the object of anthropology is to become the making of world society, the substantial intellectual gains made by ethnography in the twentieth century must be married somehow to humanistic, historical and philosophical inquiries adequate to the task. The study of money offers one strategic focus for this, since money, more than most institutions, links each of us directly with the contemporary world as a whole.

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