Money is not wealth.
Wealth is the things we want – and money is used to purchase the things we want.
But you CAN have wealth without having money. Money is supposed to make transactions of wealth easier. It gives us a common currency so that we don’t need to engage in a system of direct barter. I need potatoes but I make clocks. The farmer doesn’t need a clock, therefore I don’t get potatoes. However, money can be used to represent something we all want (traditionally gold – currently the dollar).
Money is therefore a tool, and a means to an end, not an end in itself – or at least that is how it supposed to be. At this point it starts to become painfully clear that the notion of having an economy that relies so heavily on financial services, where no wealth is being created only money, and on top of that, money that is in fact nothing but debt/credit is ridiculous. The majority of money creation is therefore the total opposite of wealth but it is what we wholeheartedly base our entire system around. And yes, it is as scary and stupid as it sounds.
There are places in the world where money gets you nowhere. However, knowledge and skill are the wealth that keep you alive (the tundra for example). Wealth is relative and fluctuating, depending on how much we need and how much of what we need there is/how difficult it is to get.
“Unless you plan to get rich by counterfeiting, talking about making money can make it harder to understand how to make money… Money is a side effect of specialization. In a specialized society, most of the things you need, you can’t make for yourself. If you want a potato or a pencil or a place to live, you have to get it from someone else.” (Paul Graham)
So the notion of making money is a false start – what we are really talking about is making wealth – we want to make the things we and others want, not just an abstract and meaningless notion. A world based on the creation of money rather than wealth will leave us with lots of numbers but no food, houses, clothes, new technology etc.
Art is a prime example of wealth creation separate from money. You create something out of thin air and suddenly it has value (ideally).
Money restricts wealth and its creation by limiting people to its power. All that we create is restricted to the funds available and thus the creation of wealth can only occur if there is enough money to pay for it, or enough potential monetary return on the wealth at the end. It doesn’t matter if it’s the most revolutionary invention ever, if it is not going to make money then it is probably not going to get made – unless its creator has unrestricted pre-existing financial backing and believes in his creation enough to go bankrupt for it.
So, here we can see how money and wealth are in conflict.
This is why we are at such an interesting point within the music world, because the ways in which business can make money from their wealth (artists) has been turned on its head. Where in the past it was very easy to neatly package the wealth and sell various aspects of it to desiring consumers, now we can consume the music we desire for free. We have such a huge library of amazing artists that the money we do spend on this incredible wealth is spread more evenly and widely to whom we decide our support will go, rather than to those/the labels of those we are told to consume.
When wealth is created without being sold – or moreover, when it is created without any intention of being sold, it is much freer to be much better. Wealth comes from passion and a longing to make the world a slightly better place – scientists traditionally donated their wealth, there is lots of open source software created by hackers so that it can be used for free and adapted, art was created to appease the heart and not the market etc. And when we create wealth like this we really do get wealthy. When we let money decide on what wealth is going to be created we head towards cultural poverty and intellectual suicide.
Sales and management have become so prominent over the years because they can be measured. They are not creating wealth – the real wealth creators who work in the companies can’t be measured because there is an element of luck and lots of time that needs to be given to create it. But the people who sell the wealth and those who manage the running of the company can be measured and rewarded accordingly. Therefore those who make money from wealth for the company will be seen as the most valuable.
The effects of a salesman working harder are obvious and completely objective as the number of sales he makes. The artist or programmer who works harder will not be so easy to measure in such terms, and as a result might not be seen as the creator of wealth despite it being their sole role. This is where money and wealth are confused – an artist can produce wealth regardless of whether it is/can be sold so that money can be made or not. A salesman or manager must produce money, which is then fallaciously perceived as wealth by those at every stage of management above and success is judged by profit and not real wealth.
Wouldn’t it be great to live in a world where wealth and not money is what we value. Do you create wealth in your own life and the lives of others regardless of whether you will receive any money for it? Or does what you do, produce and acquire mainly revolve around its ability to produce money?