Money as Foundational Social Technology Driving Civilization

Key Quotes

"It may not be the most romantic origin story but one of our most ingenious technologies writing came about because of another groundbreaking technology money money was the first thing we wrote about."

David McWilliams introduces the profound connection between money and writing, suggesting that the invention of money predates and perhaps even necessitated the development of writing. This highlights money's foundational role in human civilization, not just as a medium of exchange but as a catalyst for other key innovations.

"Economists have certainly in my lifetime taken it upon ourselves to explain money to people and I noticed this in central banking then investment banking then doing a little bit of hedge fund work and then of course over the last number of years working as an academic working as a journalist making documentaries all that sort of stuff right and two things struck me first is I'd never met a rich economist and that kind of struck me as kind of unusual if these guys are so good if our tribe my tribe are so good with cash well then number one why don't you see that many incredibly wealthy economists number one but number two and more importantly I think the economic profession has narrowed the scope of explaining money and has taken not just the fun out of money but the reality that money is sexy it's dangerous it's mendacious it makes us do the strangest things it's a force it's a power when you have it you don't want to give it away when you don't have it you want to get more of it it is a motivating power in our economy in our society but much more importantly within humans."

McWilliams expresses a critical view of economists, noting a perceived disconnect between their profession and personal wealth, and more importantly, their failure to capture the true, multifaceted nature of money. He argues that economists often reduce money to a technical concept, ignoring its powerful, often irrational, influence on human behavior and society.

"What I'm much more interested in is what I call social technologies which are technologies that we look at in economics but we actually don't give them I believe their primary status these are technologies that allow humans to collaborate and cohabitate at scale and cooperate at scale and the one thing we know meb is that the history of humanity is the history of this incredibly successful ape that is expert at solving problems and we solve problems together and we solve problems using technology and if you look at money as this foundational social technology then a whole new vista opens up to you."

McWilliams posits that money should be understood as a "social technology," akin to fire or language, which enables large-scale human cooperation. He suggests that viewing money through this lens, rather than purely as an economic tool, unlocks a deeper understanding of human progress and societal development.

"The essential elements of money have been there for a long long time but what is fascinating is why societies willingly adopted money as the way in which we organize ourselves and the societies that initially adopted money seemed to have been conferred with some competitive advantage over others and that's because as an organizational technology it's almost impossible to beat."

McWilliams highlights that while the fundamental principles of money have remained consistent, its widespread adoption is due to its effectiveness as an organizational technology. He suggests that societies that embraced money gained a significant competitive advantage, leading to its pervasive influence on global organization.

"So what you see is the beginning of what I would describe as meritocratic societies I've always been intrigued as why the greeks for example why did the greeks break the intellectual ceiling like why was it the greeks that came up with democracy they came up with theater they came up with geometry they came up with logic they came up with rationality you know these are huge extraordinary leaps of mental agility and they all happened in this civilization in a very short period of time now why was that and can we divorce that from the fact that the greeks were the first monetized society and I don't think we can."

McWilliams proposes a link between the rise of monetized societies, specifically ancient Greece, and their unprecedented intellectual and cultural advancements. He questions whether the flourishing of democracy, philosophy, and science can be separated from the economic framework provided by money.

"So what I think is fascinating about this story is that in the fulcrum of central europe in germany you have the hustler who comes up with the machine which you think is going to give the church its iron grip and solidify it but a weirdo called martin luther figures out that this is the way to spread an anti church message and in effect what you're talking about was that martin luther was the first blogger he would be the he would have been a podcaster if he'd existed now and he was a disruptor and the technology was the printing press."

McWilliams illustrates how technological innovation, like Gutenberg's printing press, can have unforeseen consequences, particularly when combined with social and economic factors. He frames Martin Luther's use of the printing press to challenge the church as an early example of disruption, akin to modern blogging or podcasting, driven by a reaction to existing power structures and financial practices.