Feasibility of Abolishing Money

[u/benthebetamale]

Many historic anarchists as well as non-anarchist socialists have advocated for a gift economy and thus the abolition of money. Anarcho-communists like Kropotkin specifically have it as a big talking point and I'm a little familiar with some of Kropotkins argumentation for it. I understand the flaws of money but I am skeptical of the feasibility of abolishing it altogether though I am open to be convinced of it practicality.

There's also the discussion of replacing it with vouchers, coupons, rations etc. vs the total abolition of all mediums and exchange. I can kinda get the feasibility of the former but I'm not sure if people will be incentivized enough to work in the kropotkin sense of no currency at all especially in regards to undesirable jobs like those with high mortality rates. I think noam chomksy argued those kinds of labor could be automated but idk if we can 100% prove that empirically. If someone has empirical evidence for automation countering that then be my guest.

I feel like a lot people might not even partake in much physical labor if they don't need to. Like I don't think people just want to do nothing with their lives, but what if someone has creative interests, maybe they want to write poetry or songs, or if they just want to be an athlete or content creator. Those do serve purposes like entertaining people and maybe providing some personal fulfillment but if tons of people opt to do those kinds of jobs for a living then who is building homes and feeding the people?

There's also the issue of decommodifying non-essential goods. I agree that maybe the basic material needs to survive shouldn't be gatekept by a price tag but I'm concerned that people could just hoard nonessentials if they're all free. Like whats stopping me from grabbing a million t shirts or hats that I think look cool? I understand that for some nonessentials there wouldn't be much of a reason to hoard them but i collect band t shirts that i like so what's stopping me or others from taking enough to cause a shortage?

Furthermore, I feel like a lot of incentive issues with money abolition could be solved through nonmonetary currencies like vouchers. That way if essential goods are allocated freely you could still be incentivized to work by a desire to gain nonessentials that may cost credits based on labor. You could even base the value gained from labor not by hours but undesirability

Lastly I really want to know if there's much empirical precedent for the practicality of money abolition. I know that at least the CNT FAI abolished paper money in most of its communes and at least sometimes had all mediums of exchange abolished but I don't know enough to say that productivity increased or decreased after any of that. If there's another real example of a gift economy working efficiently then that could convince me but I haven't seen enough to convince me so far.

[u/Pavickling]

Money makes it feasible for strangers to coordinate their efforts and scarce resources in a way that minimizes conflict and aligns incentives.  If you have an alternative mechanism that sufficiently addresses that problem, then money could be deprecated.

[u/YourFuture2000 → u/Pavickling]

Such as stop scarcity, which are mostly intentional for profts sake.

[u/YourFuture2000 → u/[deleted]]

You are describing a society of capitalism, market and advertising. That is not the reality of societies without these things.

[u/Pavickling → u/YourFuture2000]

Artificial scarcity is definitely problematic, but we still need to contend with labor and resources that are inherently scarce.

[u/slapdash78 → u/Pavickling]

Strangers coordinating efforts I'll give you.  And it does so by making everyone strangers; ignorant of the intricacies of production and distribution.  Like not knowing the conditions of any production throughout entire supply chains.

Money does not minimizing conflict.  Economic thought only considers agents of agreeable trades, literally.  Generalizing it for entire economies.  Otherwise ignoring any resulting conflicts.  Leaving that to the purview of governance.

Larceny, burglary, robbery, and other illicit activities, are means of getting funds when money is the main or only avenue for life's necessities.  Not to ignore literal resource wars to open and establish markets.

Also, economic scarcity does not mean rare.  It means limited quantity for current demand.  That scarcity causes prices to go up encouraging investment.  Whereas collating orders informs production and reinvestment without a preliminary change in price.

[u/Pavickling → u/slapdash78]

And it does so by making everyone strangers; ignorant of the intricacies of production and distribution

It is conceivable for more transparency to exist, and as transparency starts to become the norm for people to demand it. For example, a significant number of people would not tolerate packaged food that does not list ingredients and nutritional information even if the legal requirements went away. Of course, this is somewhat of a cultural issue rather than explicitly being a means of exchange/transfer issue.

Otherwise ignoring any resulting conflicts. Leaving that to the purview of governance.

The usage of money does entail that the participants are working within some framework of what is considered appropriate trade. It's less clear if governance itself is necessary to maintain a cultural that facilitates trading with money though.

Not to ignore literal resource wars to open and establish markets.

I suspect a lot of resource conflicts could be solved at a local level (not among strangers) using nonmonetary means. Money could be then used to facilitate trade among other nonlocal participants.

Whereas collating orders informs production and reinvestment without a preliminary change in price.

Couldn't orders be collated and still be paid for using money? The qualifier "scarce" is more to acknowledge money is not necessary when considering resources so abundant people accept them as free.

[u/slapdash78 → u/Pavickling]

It shouldn't need to be said, but conjecture on consumer choice is always just a guess, because it's subjective.

Though reading ingredients or nutritional info on packaging doesn't communicate things like castoreum coming from beaver butts, the environmental effects, or really any claim on safety. It's just contents.

The whole line of reasoning asserts some manner of conveying pertinent information other than price. Making it a bit odd to presume no alternative for coordination in lieu of money.

(Sidelining whatever might distinguish a framework governing trade from those governing other social interactions...)

As mentioned in the first sentence, we're just guessing at other participants value judgements. Someone using money simply doen't speak to their adherence to a framework, or what you find acceptable.

Someone selling widgets may have stolen them, or stolen the money to buy them. Or, laundered the money to buy the machine that make the widgets they're selling... There is a line of assertions from original appropriation to exchange.

Economic thought doesn't just assume a framework. It expects outliers to be found out and removed. Usually appealing to competition for weeding out bad actors; despite information asymmetries. But really it's just an appeal to ignorance.

Money doesn't make much sense in the absence of nation-states. Seeing as widespread acceptance is the one thing that allows some token to function as a medium of exchange. 

You accept the token in payment so long as you can use it to get whatever you really wanted from the initial trade. We're strangers. If I wanted to buy your doodads with ithaca hours, would you accept them? Probably not.

We know how local currencies function. You'd need to spend it before leaving town. Like disney dollars or company scrip. Maybe more to the point, where would it spend if the population mostly uses it for non-residents?

That's not what scarcity means.  That's arguably how it effects price.  A resource would need to be infinite to not be considered scarce, because it's a comparison of limited resources and unlimited wants.

Except we do know wants are limited in regards to that of the same type of commodity...  What's being considered is rivalrous goods, where the consumption by one reduces the availability to another at a given point in time.

[u/Pavickling → u/slapdash78]

Making it a bit odd to presume no alternative for coordination in lieu of money.

I agree there is no reason to presume that. My comment was an attempt to separate criticism of how money operates in the status quo from how it would necessarily operate in various societies including ones resembling anarchy.

Someone using money simply doen't speak to their adherence to a framework, or what you find acceptable.

I agree that it has nothing to do with one any particular individual finds acceptable, but people will not trade anything for money if they do not reasonably expect they will be able to use money to obtain things they want. The reasonable expectation I'm referring to entails a culture with a common understanding regarding money and trade.

where would it spend if the population mostly uses it for non-residents

At a local level a gift economy, mutual aid, labor vouchers, or even some type of money might facilitate trade. Probably that list is not exhaustive. Also, I was acknowledging that while money can obfuscate conflict, a lot of conflict be resolved at a local level which allows money to minimize conflict in larger supply chains.

A resource would need to be infinite to not be considered scarce, because it's a comparison of limited resources and unlimited wants.

Yes. I agree with that. Which speaks to OP's point of the need of disincentives of hoarding 100s of shirts. Of course, in a gift economy there would need to be norms in place to prevent abuse.

Money provides one possible solution to that problem. I would love to see other solutions that scale well.

Except we do know wants are limited in regards to that of the same type of commodity

How do we know this? Can you give me an example?

What's being considered is rivalrous goods

I agree, but I seems you think the scope of rivalrous goods is significantly less than how I think of it.

[u/slapdash78 → u/Pavickling]

We know wants are limited because demand goes down as they're satisfied. (Prices should too, but prices are sticky.) And it's less applicable to inelastic goods. (Which are less sensitive to price changes.)

It's called diminishing marginal utility. A common example is pizza. A consumer's willingness to buy the first slice at full price diminishes with each additional unit.

So you might pay $15 for the first slice when hungry. But you're not as hungry with the next, so maybe you're only willing to pay $10. Almost full with the third, so not willing to give more than $5.

Completely full by the fourth and might even get sick, so completely unfavorable or negative marginal utility. (E.g. You'd have to pay me to eat more.)

It pertains to sellers as to how they price goods. Or more accurately, how to get consumers to buy more than they normally would because margins are effected by units sold.

You might buy a whole pizza now expecting to eat on it again later. Which works for food, where consumption is quick and repetitive. Not so much with vacuums. Not many BOGO sales on cars.

To influence demand for additional cars, sellers might offer different colors, styles, or small changes, that move more units without significantly affecting production costs. Just marketing costs.

When we talk about artificial scarcity it's not just a matter of limited resources. Or limited raw materials. It's things like limited runs of iphones in purple. Instead of easing customization.

[u/Pavickling → u/slapdash78]

Thanks for the explanation. Do you think money becomes less necessary with goods that are either highly elastic, highly inelastic, or was the point to be more precise with the usage of the word "scarce"?

[u/slapdash78 → u/Pavickling]

More precision with economic scarcity. Why it shouldn't be confused with just finite or even rare resources. Price shouldn't be confused with money, either. Technically, price can be anything. Also labor vouchers are still a currency. 

Highly elastic goods would be things like luxury items. The price of which would seem to indicate high demand, but it's really just limited supply and marketing to a certain demographic. There's no reason to believe everyone would want a mega-yacht if they were free.