Money is Law

The problem with any theory on the origins of money is the assumption that money has always served the purposes it serves today. Store of value, medium of exchange, unit of account. These are functions, not things. An “Origins of Money” from the vantage point of 1491 America might start with money as a display of status in the form of feathers and beads, and end as a history of wearable jewelry.

In 2019, credit has the greatest moneyness, thus any modern history of “money” involves the origins of debt and violence.

Let’s indulge the Fed and assume that the US dollar is the epitome of money. Well that’s not a store of value. In fact, it’s specifically designed to NOT be a store of value — ZIRP renders the dollar a depreciating asset to encourage investment and consumption. Medium of exchange? That’s mostly done with credit.

Today, the most important use case for USD is to advance foreign policy objectives by sanctioning those that have fallen out of political favor. Money, then, is an instrument of persuasion.

Financial Imperialism
You know what else is an instrument of persuasion? A gun. If I point a barrel at your head, you might relinquish the contents of your wallet to persuade me to go away. Traditionally, the state is defined by whatever party has a monopoly on violence, be it the military or the mafia or the mob. But an entity with a monopoly on money can achieve the same persuasive capacity.

Yap stones are frequently used to fiatsplain how something with no intrinsic value can be used to tabulate debt. That the stones weigh four tons apiece and remain in circulation after sinking to the bottom of the ocean just goes to show how easily a population ascribes value to an arbitrary token.

A less often told story is that traditional Yap stones were actually small limestone discs. There are no limestone deposits in Yap, so stones had to be quarried 400 miles away by canoe. The larger the stone, the dicier the journey; a man-high stone was so rare it could buy a village or a plantation [1].

In the 19th century, Irish-American David O’Keefe showed up with a Chinese cargo ship and steel tools, fetched thousands of massive stones and turned the entire island into his debtors. Massive inflation ensued, which is why the Yapese ended up with ginormous boulders for money.

When you have the ability to loan out infinite amounts of money, you can enslave a population with no violence at all. See also: The entire banking industry.

References:
1. A.H.Quiggin. A Survey of Primitive Money: The Beginnings of Currency.
Routledge Library Editions: History of Money, Banking and Finance, 2017.

Eat the Cats

The best way to get rid of an undesirable is to convince people it’s delicious. That’s what we did for corn syrup, passenger pigeons, and little Irish children.

Australia is awesome. Feral cats are killing native marsupials like koalas and wallabies, so locals eliminate the invasive species by eating them.

This is exactly what I think of when I read about places like Key West and Kauai struggling with feral chickens. They’re chickens! They belong in a stew pot, not an animal shelter.

They’re safe here. Chickens know that Whole Foods shoppers won’t touch any meat that hasn’t been processed into unrecognizable slabs

Hong Kong has feral cows? I can think of twelve different ways to solve this problem, all of them delicious.

Sadly, Australian ecologists are sometimes criticized for killing feral cats:

“I can’t help but use terms like ‘xenophobia’… It’s gobsmacking how much hatred there is.” Adherents to compassionate conservation say that Australia should embrace cats as an element of its environment, rather than trying to restore ecosystems to an arbitrary point in history whose selection is dependent on the whims of those doing the choosing.

Reminds me of those old-school environmentalists who would use conservation as an excuse to justify immigration restrictions. Who are we to try to restore ecosystems to an arbitrary point in history? Climate change is progress, you racists.

Welcome, Huawei!

The Powers That Be would rather consign us to mediocre mobile connectivity than allow 5G networking equipment from China. Boo.

Ostensibly we’re worried about China using Huawei’s equipment to spy on us. (Hi, where were you guys when we outsourced all our manufacturing to China?) Funny, the Chinese government uses the same excuse to ban Google and Facebook in their own country. It’s not about censorship, they say. China bans American internet services to shield its citizens from foreign surveillance!

It’s protectionism. If China hadn’t preemptively banned Google and Facebook, Baidu and Tencent might not have gained enough market share to grow into massive conglomerates.

So we’re blocking Huawei to give Qualcomm, Nokia, and Ericsson a chance to catch up. I don’t know, I’d rather roll the dice and gamble on the off-chance China might spy on me, than the guarantee that the US government will. Remember PRISM? Germany seems more amenable to having Huawei build their 5G infrastructure after the NSA was caught monitoring Angela Merkel’s cell phone.

Besides, Chinese surveillance is less concerning than the NSA because there’s a distribution of power. China can’t punish an American for wrongthink the way it disappears its own citizens. On the other hand, political incorrectness in the US can result in the loss of bank accounts and other privileges. When it comes to domestic service providers, the witness is in cahoots with the judge, jury, and executioner.

Plus, if Chinese telecoms ignore USG subpoenas the way Chinese banks ignore FATCA, that’s a big win for data privacy.

Either way, we’ve already been infiltrated by foreign spies. Our biggest tech companies aren’t US companies. As far as accounting goes, Apple’s IP resides in Ireland, Facebook’s platform is owned by an Irish subsidiary, IBM and Google’s profits are booked by a Dutch company in Bermuda, and so on with Microsoft, Intel, and Oracle. Why are we okay with Irish and Dutch companies spying on us, but not Chinese companies? Clearly the US government is racist. I, for one, welcome our Chinese overlords.

Inflation

A couple years ago, Mark Perry published a chart showing the change in prices of goods and services over time.

The chart has become something like a Rorschach test, where people magically interpret it as confirmation of what they already believe. Globalists point out the low-cost benefits of outsourced manufacturing; Libertarians blame government intervention for price increases in healthcare and education; Socialists see the same price gains and attribute it to Baumol’s Cost Disease, because they believe that human labor confers some irreproachable value regardless of productivity.

I was in Cuba X years ago, where X is some number greater than the statute of limitations for OFAC violations. What struck me was how closely the Cuban economy mirrors that of the US. And by “mirror”, I mean everything is the exact opposite.

In Cuba, health care and education are Free, and toys and food are expensive. Well technically toys and food are free too, if you don’t want very much. Every Cuban receives a ration book that entitles them to five eggs a month and, for those with children, three toys a year. If you want more than that, you pay up on the black market.

(Don’t @ me — Cuba trumps the US in terms of literacy rate, life expectancy, and infant mortality.)

Toys in Cuba

Turns out everyone is absolutely right about that inflation chart. Globalization has indeed made manufactured goods dirt cheap in the US. A quick way to similarly reduce health care and education costs might be to send students and patients offshore, like the Mariel boatlift in reverse. As for Libertarian complaints of regulatory capture — if we rationed toys the way we ration physicians and college diplomas, toys would be expensive too. But the Socialists are smartest of them all. Baumol was right — Healthcare and education are overpriced because the opportunity cost of labor is high.

Cuba gets it. By running an authoritarian commie state, they don’t waste human resources on politics and media and bankers and other parasites. That frees up a lot of manpower for people to become doctors.

In Capitalism’s defense, well, free-market capitalism has never really been tried.

Protectionism

As usual, I waited until the last possible minute to do my taxes. I was thinking about not doing them at all, cuz you know, #Resist.

No, that’s just an excuse. Taxes are a pain in the ass. I do mine by hand because I’m ethically opposed to paying for tax preparation software. Every other civilized nation provides taxpayers with a prefilled tax filing, yet here in the US we put our citizens through needless agony because H&R Block and Intuit lobbied to make taxes as onerous as possible. Thanks to TurboTax, Congress is about to permanently ban the IRS from offering free online tax filing.

I hate rent-seekers. That’s why I get all my legal advice from the internet and buy prescription drugs straight off the dark web.

Speaking of rent-seekers — We issue 85,000 H1-B visas a year and 0% go to physicians. Why? Because the American Medical Association lobbies to make it so. Even if a foreign doctor does find her way into the US, she still has to pass three separate Board exams, get certified by the Educational Commission for Foreign-Trained Medical Graduates, undergo a three-to-five year residency program, and then take a third licensing test. That’s why we end up with so many immigrant doctors working as cab drivers.

As an occasional consumer of medical services, part of me wants to lower costs by importing lots of foreign doctors. On the other hand, my brother just embarked on his first year as an attending physician after twelve years of training and residency. He’s starting his career in his thirties with over six figures in student debt. After taxes and rent, he’ll be lucky to have his loans paid off by the time his kids go to college. This is the norm for medicine.

Maybe the rent-seekers at TurboTax also have bills to pay and children to feed.

So I don’t begrudge anyone their protectionism; I just want some for myself.

Computer programmers need supply restrictions too! Bad code can make airplanes fall out of the sky and unconscious biases persist in AI, it shouldn’t be left to just anybody.

For decades, industry employers pushed a false narrative about impending engineer shortages to secure a flood of H1-B workers. Now we have STEM workers rotting in the fields because there aren’t enough engineering jobs that pay a living wage. IEEE published some lukewarm refutations of the STEM shortage, but what they really should have done is lobby for occupational licensing. Like, no one should be able to write a line of code without a PhD and certification from IEEE. Anyone who does so is practicing code without a license. Code is law, man, and should be regulated as such.

Everyone’s a NIMBY in their own backyard 😀