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February 1, 2008: Abolishing Money Printer Friendly Version

Abolishing Money


A Proposed Research Project, with Bibliography


James Herod, February 2008

I doubt if anyone alive can tell us how to abolish money. Yet this has been a core anarchist belief ever since anarchy emerged as a distinct political philosophy (an unexamined belief as it turns out). But the idea itself is incredibly old. Zeno of Citium (333-261 b.c.) argued for the abolition of money (at least according to Robin Turner's 1997 two-page sketch of him, at <>, with information taken from Diogenes Laertius, Lives of Eminent Philosophers). I got interested in this several years ago and started looking around for substantive essays about it, only to discover to my great surprise that there weren’t any (that I have so far found).


A major theme of Proudhon's was his People's Bank, with its socialized or cooperative credit. There are two pages on money and banking in the Vernon Richard’s Malatesta anthology. There is a short chapter on consumption and exchange in Berkman's ABC of Anarchism. Other than this I'm unaware of even one book or essay that examines this proposal (the abolition of money) in any depth. I did a rapid search through some other major anarchists -- Godwin, Kropotkin, Bakunin, Goldman, Goodman, Ward -- as well as several histories and anthologies of anarchism, and several other anarchist books, and didn't see one relevant chapter, essay title, or index entry, although there must surely be scattered passages on the topic. How can this be? -- A topic so central to the anarchist vision of the good society, left unexamined. We need to get started on solving this problem. I may not succeed in getting the research done, so I’m trying to get others interested in it.


I’ve compiled a bibliography, with some possible, suggested leads on where to begin. I’ve also appended an excerpt from a report on a conference on money which I attended which represents my initial attempt to deal with the issue. I recommend the first two items as starting points.


Graeber, David. Toward an Anthropological Theory of Value. New York: Palgrave, 2001, 337 pages.
    For those who are interested in establishing an anarchist world without money, this is a good place to begin. Graeber tackles the question of the how humans assign value to things (and where prices come from and what are they based on), relying on his extensive knowledge of the anthropological literature to help answer it. A key part of the book is his long chapter on “Marcel Mauss Revisited” (the author of The Gift). Thus the book is directly relevant to the current revival of interest in the so-called "gift economy." It is an extended examination of the “value” question in non-market situations.


Ingham, Geoffrey. The Nature of Money . Cambridge, UK: Polity Press, 2004, 254 pages.
    Next. Ingham (together with a small group of economists clustered mostly at the University of Missouri in Kansas City) has been revolutionizing the study of money. They have proved that money did not originate from barter, but was instead invented by states, as a means of collecting taxes. This casts an entirely new light on the prospects of getting rid of money: if you get rid of states you might be able to get rid of money too (although they do not draw this conclusion themselves; they argue that since money reflects the power relations in the society, if you equalize the power, money would not be a problem -- to which I raise a very skeptical eye.) This book presents an excellent overview of the debate, as well as being a good introduction to various theories of money.


This new theory of money, the State/Credit theory, is also summarized in:

L. Randall Wray, Understanding Money: The Key to Full Employment and Price Stability. See also the book he edited: Credit and State Theories of Money

The UM/KC - Ingham approach is based on an earlier work, ignored until recently:
George Friedrich Knapp, The State Theory of Money.

Michael Hudson, editor, Debt and Economic Renewal in the Ancient Near East

For references to many more interesting articles on money, go to Hudson’s web site at:



Marcel Mauss, The Gift: The Form and Reason for Exchange in Archaic Societies


By most accounts the best history of money is:
Glyn Davies, A History of Money: From Ancient Times to the Present Day

A classic text is:
Georg Simmel, The Philosophy of Money

For Marx, see
"Money," Chapter 1 in the Grundrisse

Also quite useful are:
Frances Hutchinson, Mary Mellor, and Wendy Olsen, The Politics of Money
(This book has an extensive bibliography – eleven pages in small type -- on money.); and

John Smithin, editor, What Is Money?


Galbraith has a nice little survey:
John Kenneth Galbraith, Money: Whence It Came, Where it Went

Another essential study is:

Karl Polanyi, Conrad M. Arensberg, and Harry W. Pearson, editors, Trade and Market in Early Empires: Economies in History and Theory

For understanding the international financial system, see the following two items:
Michel Chossudovsky, The Globalization of Poverty and the New World Order, and

Michael Hudson, Super Imperialism: The Origin and Fundamentals of U.S. World Dominance

For Wall Street, see:

Doug Henwood, Wall Street: How It Works and For Whom


Anarchist Economics Series, compiled by Jon Bekken. List of articles published in the Libertarian Labor Review (which became the Anarcho-Syndicalist Review), with additional references, plus introductory remarks. Online at:



Werner Bonefeld and John Holloway, editors, Global Capital, National State, and the Politics of Money. 1995


Also relevant is the long standing debate over the labor theory of value. The basic question of course is how we are to determine the value of something, in comparison to something else, to serve as a basis for exchange? Or is determining value even necessary for exchange? What about gifts and mutual aid? To begin with, see:

I.I. Rubin, Marx's Theory of Value, and

Ronald Meek, Studies in the Labor Theory of Value


McNally, David. Against the Market: Political Economy, Market Socialism, and the Marxist Critique. London: Verso, 1993, 262 pages.
    This is a brilliant reconstruction of the decades-long dispute between Marx and Proudhon over the market. Marx rejected the market, McNally claims, while Proudhon didn’t. This is an insightful book, and is very helpful in getting a handle on so-called market socialism, of which Proudhon's theories were the first example, McNally claims.


Rubel, Maximilien, and John Crump, editors, Non-Market Socialism in the Nineteenth and Twentieth Centuries. (St. Martin’s Press, New York, 1987, 187 pages.) "In the nineteenth century, socialists as different as Marx and Kropotkin were agreed that socialism means a marketless, moneyless, wageless, classless, stateless world society. Subsequently this vision of non-market socialism has been developed by currents such as the Anarcho-Communists, Impossibilists, Council Communists, Bordigists, and Situationists." (from the publisher). Included are essays by Adam Buick, Stephen Coleman, Alain Pengam, and Mark Shipway, which ferret out this thin thread of revolutionary thought. There is a postscript describing other resources for each of the five currents discussed, as well as a four-page bibliography. This is a very important book.


On the Idea of a Gift “Economy”


A lot of work is now being done on the idea of a gift economy. Here are some references:


David Graeber, “Give It Away,” online at:


This essay also includes an account of the group formed in France, of which Graeber is a member, to build off the theories in Marcel Mauss’ The Gift.


Lewis Call, “Anarchistic Gift Economies in Contemporary Science Fiction,” Anarchist Studies, Vol. 10, No. 2, 2003


Terry Leahy, “Sociological Utopias and Social Transformation: Permaculture and the Gift Economy,” online at:


See also the links on his web site at:



Carol Brouillet, “Reinventing Money, Restoring the Earth, Reweaving the Web of Life,” online at:



David J. Cheal, Gift Economy. 1988


Genevieve Vaughan, For-Giving: A Feminist Criticism of Exchange. 1997


Richard M. Titmuss, The Gift Relationship: From Human Blood to Social Policy. 1971



On Local Currencies


The best book on alternative currencies is

Richard Douthwaite, Short Circuit: Strengthening Local Economies for Security in an Unstable World. See also his The Ecology of Money.

But see also,
Thomas H. Greco, Jr., Money: Understanding and Creating Alternatives to Legal Tender

Community Currencies. (a list of resources and references), online at:



Local Currency Resources, online at:



Reinventing Money. Another web site, established by Thomas H. Greco



Complementary Community Currency Systems and Local Exchange Networks. (A list of resources.) Online at:



Susan Meeker-Lowry, "The Potential of Local Currency," Z-Magazine, July/Aug, 1995, pp. 16-23.


David Boyle, Funny Money. In Search of Alternative Cash. 2000


Local and Interest-Free Currencies, Social Credit, and Microcredit. An extensive list of resources on the above, as well as alternative money systems, LETS (Local Employment Trading Systems), usury. Online at:



Bernard Lietaer, The Future of Money: Creating New Wealth, Work, and a Wiser World. 2001


Susan Witt, “Printing Money, Making Change. The Promise of Local Currencies.” Online at:



Tim Cohen-Mitchell, “Community Currencies at the Crossroads.” Online at:



Paul Glover, “Grassroots Economics.” Online at:




Other References  (from various political perspectives)


Moses Hess, “The Essence of Money,” [1845], online at:



George Caffentzis, “The Power of Money: Debt and Enclosure,” online at the Commoner, No. 7, Spring/Summer 2003 [].


Neil Birrell, “Some Notes for an Anarchist Theory of Trade,” The Raven, No. 31, pp. 247-261. Online in Spunk Archive at:



Christopher J. Arthus, “The Concept of Money,” Radical Philosophy, No. 134, Nov/Dec 2005. Abstract online at:



Kenneth Couesbouc, “A Short History of Lending and Borrowing Money, It’s a Gas,” online at Counterpunch, September 21, 2007.


“A World Without Money,” Socialist Standard, July 1979. Editorial Committee.


Rodger Mitchell, Free Money. Plan for Prosperity. 2005
Two books building on the ideas of Henry George are:

Michael Hudson,, A Philosophy for a Fair Society. 1994. And

J.W. Smith, Money. A Mirror of the Economy. 2006


Life Beyond the Market. Special issue of Greenpepper Magazine, out of Amsterdam. See the web site at:



Norman Angell, The Story of Money. 1929


Paul Bohannan and George Dalton, editors, Markets in Africa: Eight Subsistence Economies in Transition. 1965


Marshall Sahlins, Stone Age Economics. 1972


Victor Perlo, The Empire of High Finance. 1957


William Greider, Secrets of the Temple. How the Federal Reserve Runs the Country. 1987


Andrew Hacker, Money. Who Has How Much and Why. 1997


Niall Ferguson, The Cash Nexus: Money and Power in the Modern World 1700-2000. 2001


Gregory Claeys, Machinery, Money, and the Millennium. From Moral Economy to Socialism, 1815-1860. 1987



- - - - - - - - - - -

Excerpt from my paper: The Conference on Money. A Report from an Onlooker.

(Comments on The Nature, Origins, and Role of Money, a conference held on March 31 and April 1, 2004 at the University of Missouri at Kansas City, which was organized by the Center for Full Employment and Price Stability, a nonpartisan, nonprofit policy institute at the University. This is a memorandum addressed to the staff, faculty, and guest speakers at the Center’s conference.)

Thanks first of all to those who organized this conference, for the free lunches, and for the complimentary copy of Wray’s book on Understanding Modern Money. It was all very well done. The conference proved very interesting to me, although not in ways that I had originally expected. Thanks also for the display of some excellent looking books on money. I will definitely study them.

I was interested in attending only to get some general background knowledge about money because in the near future I’m hoping to undertake a study of the topic in order to write an essay on Abolishing Money. I have collected a few books, such as Davies’ History of Money, Galbraith’s book on Money, Simmel’s Philosophy of Money, Marx’s chapter on "Money" in the Grundrisse, and several others. Abolishing money has been an item of anarchist belief for a long time. I got interested in this not long ago and started checking into it. I was surprised to discover that almost nothing of substance has been written about the idea, at least that I have found so far. Even though my study of the literature on money and gifts has hardly begun, and at the risk of appearing foolish, I’m going to respond to what I heard at the conference anyway, based on my general knowledge, as a way of getting myself started on the issues….

I regret that I did not find the courage to raise my concerns during the meetings themselves. In addition to my natural (late-life) timidity in such situations, it did seem to me that my interests fell completely outside the framework of the conference, and that I would have been intruding to ask the questions I was interested in. Too bad though that I could not have suffered myself to be a little bit rude and asked them anyway. They might have added a dimension to the discussion which was missing.

In any case, I did manage to ask about abolishing money to several of the featured speakers during the breaks between talks. I had cryptic exchanges with Michael Hudson, Franklin Wray, and Geoffrey Ingham, and brief, but more substantive discussions with Mathew Forstater, Stephanie Bell, and Mark Peacock. I wish I had a photo of the bemused little smiles I got from some of you when I asked about abolishing money. I’d attach it to this report.

Nevertheless, some headway was made. I’m appreciative of that. So let me get right to it.

Right off, in the first lecture, by John Henry on the Social Origins of Money in Ancient Egypt, it was established that money appeared only after the original egalitarian traditional society had broken down, with the emergence first of the hydraulic engineers as an elite and then of an elite priestly class and finally of a centralized government. Money, in the form of the debben, was at first merely an accounting device, with no coinage, and it remained that way for hundreds of years. So you theorize that money is state created, and reflects the social relations, the power relations, of a class society. The government in effect places the population in a state of indebtedness. It says, you owe me. So the population, at this time as whole villages not individuals, has to scramble to pay off the debt. The debben was invented as an accounting device to keep track of the payments. It would seem then that, according to the Credit and State Theories of Money, that most of us, as subjects of governments, have been forced into a state of indebtedness ever since the emergence of the first state. Who wants to be perpetually in debt?

This raises an obvious question. Why not get rid of states, abolish them, dismantle them? There is a corollary question. Why not get rid of classes, and establish once again an egalitarian, classless society? But you weren’t asking these questions. Why not? You can hardly be unaware that there have been massive grassroots movements, world wide, for over two hundred years now, ever since the French Revolution (and even before, in the English Revolution of 1640, and earlier) to do precisely this, abolish the state and establish a classless society. Even the marxist-leninist communist movement, which got derailed for over a hundred years into the two stage strategy of capturing the state as a way of getting to communism, nevertheless held on to the ultimate goal of establishing a stateless, classless society. Abolishing the state has been a central goal of the anarchist movement since at least 1793 with the publication of Godwin’s book on Political Justice.

This history doesn’t seem to enter your thinking, however, at least not in a prominent way. The automatic response from all of you, upon being asked about the possibility of abolishing money, was that this could only be done in a small scale, traditional, self-sufficient, egalitarian society. We would have to go back to that, you said. This accounts for your dismissal, because you do not believe that this is possible (or desirable). Only one person, Franklin Wray, said that well you could also go forward to communism. How come you discount, and do not relate to, at least in your theorizing, this centuries-old struggle for an egalitarian society?

Your Credit/State Theory of Money, which sees money as a social relation reflecting the hierarchical power structure of a class society, has only enhanced my interest in abolishing money. Fred Lee, when asked about abolishing money, recounted for me this theory of money and said that if capitalism were gone, everything would be different. That is, the power relations would change. Money as we know it couldn’t exist. This got me up to my starting point. Would there be any kind of money in a stateless society? How would goods and services be exchanged? Or would they? Mark Peacock did admit, in one of my short discussions with him, that abolishing money and abolishing the state would probably have to go hand in hand. (Mark also tried, on several occasions, and to his credit, to introduce the topic of exploitation into the discussions at the conference, but to no avail.)

One question I wanted to ask in the meetings, but didn’t, but which I asked of Stephanie Bell, was: Can you describe for me a noncredit theory of money (leaving to one side the orthodox barter theory of money)? She said there was no such thing. All money is based on debt. I told her I had read once about a non-debt kind of money, by the Irish economist Richard Douthwaite, but that I couldn’t remember what it was. She said that she wished I could. I have since dug up the reference. It was in a small book called The Ecology of Money. I have sent her a copy. Upon examining this text further though, I’m not sure Douthwaite thinks of money in quite the same way as you do. He sees bank money as debt based, and government money as tax based, but seems to think that we could have a people-issued money which was not debt based. He apparently does not believe that the various alternative currencies that are being tried out are debt based. I suspect you would disagree with this. By the way, how come you did not have at least one paper on alternative currencies? It’s a fairly substantial movement.

One bit of analysis, made by one of the speakers, would tend to undermine Douthwaite’s position. He said that the Credit Theory of Money applies even to everyday commodity exchanges. As soon as you accept an object or service from someone, you are placed in a state of indebtedness, and have to pay it off. So all exchange has a Credit-Debit character. Money is not a neutral medium of exchange between equals, but has this power dimension inherent in it.

Advocates of alternative currencies are not trying to get rid of money. They are just trying to get money that is not controlled by, and which works for the benefit of, governments and banks. They want money controlled by people in their local communities. But I guess the debit-credit theory of money holds for these alternative currencies too. That is, measured exchange itself involves us in the debt relationship. Indebtedness is inherent to exchange. Have I understood the theory correctly?

Which brings us to Gift Giving as a basis for society. Couldn’t gift giving take the place of money as a basis for organizing our social lives? There was no hint of this in the conference. Is anyone in the department even interested in this idea? Of course, gift giving could rapidly degenerate into a kind of measured exchange if accounts were kept. I helped you build your barn, so now you have to help me build mine. I did a favor for you, now you owe me one. We’ve given you this and this and this, but you never give anything back. And so forth. Gift giving would have to be free of strings I think, with no expectation of reciprocity, for it not to become just another form of measured exchange, in which case why not just use money. (It is also true of course that gift giving can become a sort of power play of its own. Those who give and give but refuse to receive, set up a kind of power relation. Those on the receiving end can come to feel obligated.)

There is another reason for keeping gift giving non-reciprocal and free of expectations. As soon as we start keeping track of gifts given and gifts received, then we are back to the equivalencies problem, that is prices. Are the gifts that we received worth approximately the same as those we gave. I have long believed that prices are completely arbitrary. This is because objects do not have an inherent value. Something that is worth the world to one person may be considered worthless by everyone else. That is, an object has value only for those persons who want it; it has no value for those who don’t. The value of an object is simply a measure of our subjective desire for it. Nor is labor time a useful measure of value. Someone may spend many hours making an object no one wants. Plus there are differences in skill levels, energy levels, health, and a host of other factors. Nor is the socially average labor time any better to my mind. Why get bent out of shape trying to find a way to measure the value of something when it has no inherent value? We are pressed to assign a value to it only because we want to exchange it. But what if we didn’t want to exchange anything?

Henry in his paper on ancient Egypt and Hudson in his paper on Sumeria, both reported that the price problem was solved in these societies by the government or temple, which issued lists of equivalencies. One goat is equal to so many bushels of grain, and on through a long list of items. In this way they achieved price stability through centuries, or until a new government came to power and published a new list.

In a perfect, unregulated, capitalist market, with many producers and many buyers, the price is supposedly set by the cost of production. But this just means that the producer who succeeds in paying his workers less than everyone else will have the lowest price. How can the value of something be established by what is paid to the most exploited wage-slaves? But of course, these kinds of markets don’t exist and never have, at least if we look at capitalism as a whole (there may be sectors which come close to such a market). Monopoly has always been a big factor in the capitalist system from its inception. Moreover, monopoly sectors always produced the greatest profits; capitalism as a system could not have survived without these monopoly profits based on made up prices. Prices are essentially arbitrary. Producers charge whatever they want, or whatever they can get away with.

Returning however to the matter of the non-reciprocal gift, Mary Douglas (in her Foreword to a 1990 new translation of Marcel Mauss’ classic, The Gift: The Form and Reason for Exchange in Archaic Societies [1950] ), firmly condemns the idea. She writes: "It is not merely that there are no free gifts in a particular place, Melanesia or Chicago for instance; it is that the whole idea of a free gift is based on a misunderstanding. There should not be any free gifts. What is wrong with the so-called free gift is the donor’s intention to be exempt from return gifts coming from the recipient. Refusing requital puts the act of giving outside any mutual ties. Once given, the free gift entails no further claims from the recipient.... According to Marcel Mauss that is what is wrong with the free gift. A gift that does nothing to enhance solidarity is a contradiction.... Even the idea of a pure gift is a contradiction. By ignoring the universal custom of compulsory gifts we make our own record incomprehensible to ourselves: right across the globe and as far back as we can go in the history of human civilization, the major transfer of goods has been by cycles of obligatory returns of gifts.... There are no free gifts; gift cycles engage persons in permanent commitments that articulate the dominant institutions." Evidently, all the historical cases of gift giving systems have been deeply entwined with the status and power structures of the society. Obviously, for this to work, value had to be assigned to the objects being given and received. (Michael Hudson claimed that Mauss has been superseded, at least with regard to his theory of interest.)

Is being in debt bad? One of the speakers said that government deficits are not bad, according to the Credit Theory of Money. On the contrary, debt is normal and essential for the monetary system to work properly. But surely this doesn’t apply to non-governmental debt, by individuals or communities. A generally held norm is that it is bad to be in debt. Whether this norm also holds for obligations incurred in reciprocal gift giving I don’t know.

So, in trying to imagine a social order based on mutual aid, without markets or measured exchange, all these concepts -- money, prices, value, gifts, debt -- have to be ironed out.