Money is imaginary. Like the high definition screen in your living room, it is a complete creation — a human creation. We use it as a symbol for exerted human energy.
Before our industrialized world came into being, there were complex civilizations that exchanged human energy without money. Some people hunted, some made tools and pottery, others were healers.
An individual would exert energy to create a good or service. The society would then exchange these goods and services from one person to another.
The Inca Empire was one of these civilizations. It stretched across the Andes Mountains through modern Colombia, Chile, Bolivia, Ecuador, Argentina and Peru.
Across this territory, which spanned over 770,000 square miles, they connected cities rich in resources to one of the most complex highway systems of the Old World; and they did it without spending a dime.
In a world where the concept of money did not exist, the Incas managed to create a vibrantly rich society — one that was rich enough to assign hundreds of architects and planners for the building of a single city.
There was no economic class because there was nothing to buy. So the Incas paid their government in effort. In exchange for their work, everyone was supplied with farming tools and food when local crops failed, though this rarely happened. Considered master agriculturists, the Incas staggered crops at different altitudes up the mountainside in order to thrive in the correct temperature. They even built high stone retaining walls that captured the sun’s heat during the day so the crops did not freeze at night.
Although a culture without currency sounds alien to us, the Incas were doing something that continues to sustain our lives today — they were exchanging human energy.
This exchange arose naturally, because the exchange of energy is Natural. You can see it in pollination between plants and insects, or the interdependence of predator and prey.
Every living system must transfer energy to survive.
But as human civilization grew larger, so did the complexity of the goods and services it created; and the need for a system that could overcome the inefficiencies of bartering was born. Human beings needed a standardized medium of exchange — one that could symbolize the value of a good or service — instead of trying to trade the goods and services themselves.
1. Any generally accepted medium of exchange which enables a society to trade goods or services without the need for barter.
Fast forward several centuries, and money has become so intertwined with our lives that it’s hard to imagine a world without it. But beneath the credit card numbers and electronic bank accounts, money is just a symbol of value. We use it to exchange goods and services, and these goods and services are created by human beings.
By that logic, money is just a symbol for exerted human energy. The Incas were exchanging this energy. They just didn’t use the symbol.
The difference between the Incas and the United States was their ability to identify the goods and services that their citizens needed to survive and grow.
Once they identified and delegated these resources, the empire went through massive expansion. They became master architects, engineers and agriculturists. They understood incredible amounts of astronomy and mathematics. All of this was possible because they managed to create a state of physical security for their people.
Human beings who are concerned with physical security live in a psychological state of survival. Each day, their focus is to acquire the resources necessary to live. Meanwhile, those who believe that they are physically secure have the space to grow and evolve. Instead of exerting energy to survive, they exert energy to follow their passion and create.
Everything — from the water that is pumped through your faucet, to your phone’s constant connection to the World Wide Web — is created by human energy. Money is just a symbol that we use to exchange this energy from one person to another.
It is the exchange of human energy, not the money itself, that creates the increasingly complex world we live in, where every product or service imaginable has been created.
Money is made up, but the exchange of human energy is real and vital for our industrialized lives to function. Without its flow, the grocery store goes empty and the electricity shuts down.
But this modern system — where human beings exert energy to create a good or service, then use money to exchange these goods and services from one person to another — is breaking down, because we’ve tied money to everything.
Without enough money, you cannot feed yourself, or go to a doctor. Your electricity and water shuts down, and you are pushed out into the night.
Instead of ensuring that everyone in our society has what they need to survive and grow, we have allowed fundamental goods and services to become privatized; and a large group of Americans have been tricked into thinking that cutting off these basic resources to U.S. citizens is somehow serving them.
The question for us as American tax payers is whether this belief is creating the society that we want.
But in order to really examine this problem, we have to cut through some tricky rhetoric that has been stopping us in the first place.
The vital issue of identifying and delegating resources to U.S. citizens has become compressed into a single phrase that we have all heard a million times — “the distribution of wealth.”
For those of you that cringe when you read “distribution” and “wealth” in the same sentence, let me be clear — your wealth is already being distributed.
We all pay taxes. Some less than others. But we all pay them.
We create wealth by exerting energy to create a good or service. In return for our exerted energy, we get our own, personal energy in the form of money. And like the Incas before us, a portion of this effort goes directly to the government.
If you make 50k, you are paying around 11 thousand dollars in federal taxes alone.
Writing that check each year is painful. And it is the discomfort with paying taxes that makes the conservative argument of “stopping big government” so attractive. Big government is creating a culture of dependency. So if we cut it down, we pay fewer taxes and people start taking responsibility for their lives. It makes perfect sense.
The problem with this story is that all of us, no matter how wealthy we become or what we achieve, are completely dependent on other people. We are born children, and we die elderly. We all go through a period when we cannot create goods or services — i.e. human energy — that adds value to other people’s lives; and even when we are at the peak of our careers, we are absolutely dependent on the exchange of other people’s energy to survive.
Like any living system, the multimillionaire’s life is sustained by energy. This energy is first produced by the elements of the earth. It is then organized and transferred to him by other people. Although he may like to believe he is self-made, his life is sustained by the migrant worker who picks his produce, or the engineer that ensures that the water pumps into his home. We are all connected. We live off of goods and services created by other human beings.
This is a Natural Law, but it has become manipulated and compressed into the “the distribution of wealth” phrase, which fundamentally fails to make the distinction between wealth and resources.
Resources are the goods and services, created and sustained by the exchange of human energy, that are vital and necessary for every American to reach his or her fullest potential. Resources are food, shelter, health care, and education.
Wealth, on the other hand, is excess. It buys you golf clubs and a new car, and it’s neither necessary nor vital for personal survival or growth.
What we are increasingly seeing in the United States — a government entity that collects massive amounts of human energy in taxes each year — is an attack on the distribution of resources, not wealth; and a number of studies have emerged that put the systematic stifling of human resources front and center.
“the life chances of a child [in the United States] are more dependent on the education and income of his parents than in any other advanced countries for which there is data.”
Stiglitz is referring to a study that looked at data from ten of the worlds wealthiest nations. It concluded that American children had the lowest chance of any other nationality in overcoming the economic circumstances of their parents.
Meanwhile, child poverty in the United States is higher than what exists in virtually all other rich nations. In a study that examined 41 of the worlds richest countries by the Stanford Center on Poverty and Inequality, the United States ranked 37th, with a child poverty rate of 21% over the last decade; and the majority of these impoverished children are going hungry.
According to the USDA, 14.9% of all Americans are food insecure — that’s 50 million citizens, 17 million of which are children, who worry everyday about putting food on the table.
When you look at the data, the fact that American children find themselves frozen in the fate of their parents comes as no surprise.
We have created an environment where your parents income determines everything, from the quality of your education to your chances of eating another meal.
This occurs because, in a world where basic human resources are sold like other private goods and services, the money in your parents savings account determines your level of physical security.
Meanwhile the costs of providing this security are made exponentially more expensive by the companies and individuals who control them, because they are selling goods and services that we need to survive. So we have no choice other than to buy them.
This is why a plastic IV bag in an American hospital, which costs less than 50 cents to produce, costs over 500 dollars for the sick patient using it, and why the cost of getting a college education, which ideally gets you a good job to provide for your family, has risen two to three times the rate of inflation.
While we pay huge portions of our income to the U.S. government, we have created a world where it is increasingly impossible for normal citizens to provide for themselves; and the odds are especially stacked against children born in low income families.
Although the United States’ per pupil spending on education is on par with other advanced nations, the way we distribute these funds stands apart from anywhere else in the world.
According to PISA, a well known study by Organization of Economic Cooperation and Development (OECD), “all OECD countries except the United States, Turkey, and Israel now devote equal if not more resources to schools facing greater socio-economic challenges.” 5
While the rest of the world funnels the most resources to schools located in the poorest regions, in the United States the opposite is the case; the majority of the resource go to wealthiest districts while the poor ones get left behind.
That’s because, unlike the rest of the world, school funding in the U.S. is dependent on local rather than federal funding. Look at the single tax payer who makes 50k annually. Of the $11,000 that she pays in federal taxes, only a portion of 3%, or around 133 dollars, goes to education. Contrast that with what she spent on National Defense, which is over $1,800 or 17%, and you can see why schools from impoverished neighborhoods struggle.
At the federal level, we are spending nearly 14 times more on maintaining a massive military force rather than educating our children.
During the Iraq war, the United States spent more than half of the total military spending on planet Earth. Today, we pay for around 40%.
Meanwhile U.S. citizens are living in an increasing state of survival.
“We lose in Chicago more black kids than the solders in Iraq,” said Illinois Senator Jaqueline Collins in a riveting episode of Vice. “There are consequences, I believe, to failed economic and political policies that most communities of color in Chicago are facing. High unemployment — 23 percent or more — and failing schools. We have the closing of mental facilities…the foreclosure crisis. This is decades of a lack of resources flowing into these communities.”
Allowing whole sections of the US population to fall into a state of survival stifles innovation at every level of society.
When you look at the technology that we have created, it is clear that we are complex beings capable of extremely creative thought. Within each of us is the potential of creating the life that we want; and we all hold dreams of the highest, most creative expression of ourselves.
These inner-visions are showing us the potential of our lives pursuing the things that bring us the most excitement and joy; and within them are the keys to creating a more sustainable world.
But in a world where there is no bottom to how far you can fall — where failure can lead to extreme poverty and desperation — thoughts of survival often smother these higher visions.
For U.S citizens, these thoughts have become a reality. They are the hidden drivers behind staying at a job that you do not enjoy. They are the force that sabotages the college student with the next big idea. They are the resistance that causes us to choose the safer route over pursuing our dreams.
We have forgotten that these fears are illusions; and as crazy as it may sound, they are completely self-created.
We live in a society that has created unquestionable material abundance. The problem is not our supply of resources, but that these resources have been overtaken by industries that no longer serve us. Rest assured, war is one of the most profitable enterprises on Earth. According to a study by Brown University, the Iraq war costs U.S. tax payers over 2 trillion dollars. This undoubtedly made the private contractors, oil companies and weapons producers involved incredibly wealthy. Meanwhile it is estimated that over 190,000 people died in the Iraq war alone.
While defense spending is considered untouchable, 217 House Republicans recently voted on one of the largest cuts to Food Stamps in U.S. history. Right now, some 47 million food stamps recipients, many of whom were laid off during the financial crisis and subsequent recession, live on just 4 dollars a day.
When we remember that money is just a symbol for exerted human energy, and that we collectively pay the U.S. government massive amounts of it, the idea that we should delegate this energy to anything other than ourselves goes out the window.
Like the neural connections of the human nervous system, or the network connections of the World Wide Web, our universe is one of ultra-connectivity. It is a place where the success of one person creates ripples that can affect the lives of millions of others. But unless we create a state of physical security and well being for our citizens, this reality is stifled by fears of survival.
Just like money, these fears are imaginary. They were created by the belief that we are separate from each other. But once we see through this mirage, and we collectively demand that every dollar given to the US government is spent on creating physical and psychological security for our citizens, these fears that have been holding us back will fall away.
If you don’t believe me, ask yourself this question. What if you woke up tomorrow knowing that, no matter what, you and the people you care about were physically secure. What if you knew that there would always be a place to stay, food to eat, and a doctor to see if you needed it. How would that change your choices?
You might discover that the company that you wanted to start, or the book that you wanted to write, or the film that you wanted to create, but didn’t, because of fears that you wouldn’t be able to support yourself or your family, becomes your first priority. You might discover that risk becomes fun for you, because you know that it is a vital step to creating something of value. From that space, we will truly unlock human creativity and potential.