What Are the Disadvantages of Money Economies?

I have no objection to profit. I’ve started and run several successful businesses. But I’ve come to understand that the profit motive flourishes in younger cultures—the cultures in which people see themselves as separate from each other and from the rest of existence. Profit exists only if you draw a circle between “me” and “not me,” then measure how much goes out of your circle and how much comes in. That simply doesn’t happen in the older cultures where people don’t isolate themselves but instead feel “we’re all in this together.” —Thom Hartmann, The Prophet’s Way

 In order for one person or entity to receive money, another person or entity usually must lose money. There is usually an exchange of goods and/or services when money is exchanged. Sometimes, one or both parties feels cheated when the exchange occurs. For example, if someone has to pay a fixed high price for something he thinks he really needs, and cannot get it anywhere else, he may feel powerless or resentful. It is unusual for both parties to be satisfied with an exchange.

Money economies are built upon the idea that people should accumulate as much money and/or possessions as possible. One usually does this by selling a service or a product. People go along with this economic system because they are born into it, or they feel that they benefit from it. Few people question it.

What are the pros and cons of such an economic system? The advantages of the system are that people can transfer goods and services quickly and they can easily take their money wherever they go. It can be seen that, through these advantages, money economies have greatly expanded and the selection of goods and services available has greatly increased.

However, there are some disadvantages to such an economic system based on money and the profit motive. First, most of the things that a person produces do not directly benefit the person who made them. This can make a person feel that his work is only going to benefit someone that he has never seen and will never know. A person can feel like his purpose for working has been diminished. He becomes alienated from the results of his labor. He is disconnected from the consumer and the consumer cannot usually show his appreciation to the producer.

Second, when business is conducted, both parties of the transaction may feel used or undervalued. The one who receives the money may think, “He is only giving me this money because of what I can do for him. He doesn’t really care about me as a person.” The other one may say to himself, “This man only recognizes me because of the money I give him. Otherwise, he wouldn’t give me the time of day.” The transaction can be a selfish and isolating one.

Third, money economies seem to require specialization in order to increase efficiency. Someone might spend a lot of time training for a certain position, and then later feel trapped in this same position. He might not be able to leave his position because he cannot afford more training for another position. Another person might have to work on an assembly line, and have to do the same thing day after day, just to keep himself alive. Some people find security in that kind of job, but many others find little meaning in it.

Why have money economies spread over most of the world? One of the reasons is that they cater to an insatiable greed and desire for possessions that many people have. Another reason is the very fact that they allow for impersonal transactions. When people do not have to be concerned about each other, they can make transactions with anyone anywhere, even their so-called enemies.

Money economies work well with the isolation of individuals, families, and larger groups. When people think of only themselves and their close relations, they perpetuate the isolation and alienation that money economies enable. Because people tend to hurt each other, it is often easier for people to live with isolation and alienation than to risk getting hurt. (This reminds me of the book The Great Divorce, in which C. S. Lewis describes a hell in which people continually moved farther and farther away from each other.) Can people hurt each other less, and thus lessen the need for isolation? That is a question for another article.