Cap on debt

Peter Bierl

Book review: David Graeber,
Debt: The First 5000 Years.
New York: Melville House, 2012.

Like many critics of globalization, David Graeber does not seem to understand what capitalism is. Otherwise he would not emphasize time and again that a market economy is something fundamentally different, as he does in his book, Debt: The First 5000 Years. Graeber’s distinction fits with a lot of left-wing currents, from old-fashioned anarchists in the tradition of Proudhon to young militants of Attac. All too many people assume that capitalism simply means financial speculation, intransparent bank dealings, monopolies, or interest as a way to garner income without work, all of which place a burden on the middle class. A market economy, on the other hand, is associated with “honest” labor and fair exchange.

Sociologically, this has been the ideology of a petit-bourgeois middle class — of small artisans, merchants, peasants, self-employed doctors, attorneys, engineers, public officials, high-salaried workers, and skilled laborers — since Proudhon coined the famous phrase, “property is theft.” Of course, his fans often willingly overlook that Proudhon aimed at people who exploit others by lending money for interest, and that he blamed the Jews especially for doing so.

In Debt, which has drawn praise from bourgeois reviewers and parts of the Left, Graeber begins by stating that we do not know what debt really means (5). He distinguishes debt and credit: Debts are abstract and quantifiable, establish “simple, cold, and impersonal” relationships between human beings, are connected with coined money, and based on violence, whereas credits imply personal, emotional relationships and moral foundations, as if they were some sort of mutual aid or charity (13, 21). In the beginning of human history, Graeber claims, people made gifts reciprocally or gave things away on simple and non-quantifiable credit. Throughout the book, Graeber describes long cycles of history in which societies based on credit alternate with those based on money and debt.

Graeber skips around between ages and continents as he sees fit. When he wants to prove that adscript peasants were indeed well off since they did not have to supply their produce to townspeople, he points to sparsely populated Europe. When he wants to make us believe that the Middle Ages were an absolutely peaceful era, he declares Europe, with its eternal feuds among its noblemen, as irrelevant, and points to Asia (297). Of course, the ruling powers in the Islamic world as well as in India and China waged endless war against each other and against their subjects too. Continue reading