More of money's dark secrets this week. We begin with Edward Griffin on the connection between debt, central bankers and their direct financial interest in perpetuating war and the threat of it. We conclude by reading The Myth of Barter, chapter 2 of David Graeber's Debt, The First 5000 Years.
We start the show this week with Edward Griffin continuing where we left off last week, explaining the mechanics of the money creation process, and the relationships between governments, central banks and commercial banks, between war, debt and the profit of a few.
By examining the origins of central banks in Europe, Griffin suggests a template to understand just how an elite, whom he calls international financiers, profit from perpetual war. This strategy, which he calls The Rothschild Formula, is basically the international organisation of financiers. Presenting a unified front allows them to exert power over individual national governments, provided they could be kept on hostile terms with one another (a topic which is expanded upon further in a A Brief History of Plutocracy). Focussing particularly on the first half of the 20th century, he recounts some extraordinary events which point to the hidden hand of these financiers, such as the involvement of foreign capitalists in the 1917 Russian Revolution.
Griffin continues into our second hour, after which we read The Myth of Barter, chapter 2 of David Graeber's Debt, The First 5000 Years. He soundly refutes the 'myth of barter', which was proposed by Adam Smith in 1776 to be an intermediate stage in the evolution of money, a misapprehension which is still widespread today.
"Rarely has an historical theory been so absolutely and systematically refuted [as that of money evolving from barter]. By the early decades of the 20th century, all the pieces were in place to completely rewrite the history of money... [but] the curious thing is that it never happened. This new history was never written... Textbooks did not change their story â even if all the evidence made clear that the story [of money evolving from barter] was simply wrong" â David Graeber, on the Myth of Barter, Chapter 2 of Debt, The First 5000 Years
As he explains, the story of barter holds a pervasive hold over the limited imagination of economists, since it obscures the role of centrally controlled money systems in extracting tribute and is used to justify the position of 'economics' as a discipline in itself, as separate fromn politics, anthropology or other fields of study.
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