What does it mean to be ruled by money? It means being controlled by the need to claw as much money as you can from the system in order to purchase, on a market, the means necessary to survive—either as an individual, or as a whole country run by a government (or a State). To be ruled by money is to need to use all the powers at your disposal to get more money, in order to stay alive. It is to pursue money at the expense of other needs—like the cultivation of virtue in leisure time. So why does money rule the world?
Money rules the world, firstly, because production still needs people. By “production”, I mean the use of technology and labour in order to get the resources—like food, shelter, and transport—that meet our basic needs and desires. Some production is automated—run on robot-controlled technology alone, like the printing press. But a lot of production still requires labour—people working to use the technology, like a farmer overseeing a combine harvester. Some work has been automated, but this has just produced more skilled work.
If production were fully automated, people could be given a universal basic income—even more than the $1,000 Trump income Americans initially received due to the coronavirus crisis—which is enough to live off, without needing to work for a wage. In a post-work society, your money doesn’t determine whether your needs are met—because no-one has too much more money than anyone else. But we’re not yet at the stage where all work—and all production—can be automated.
So, whether people can satisfy their needs depends a lot on their class position (whether they have to work for a living, or whether they receive their income from shares) and, if they do have a job, their workplace position (precarious employment, traditional working-class employment, or professional-managerial employment). That is to say, whether people can satisfy their needs depends on money. So, the fact that production still needs people means people are run by money.
Money also rules the world because markets are global—but governments are national. We live in a world that has become economically integrated since World War II, with a lot of trade mobility in capital, goods, and labour (though the coronavirus crisis significantly reduced these last two, for a time).
But the world has not also become more politically integrated. While some make out the United Nations to be a world government, it doesn’t have an army, police-force, or a centralised executive—so it doesn’t count as a State. Governments remain national; only diplomacy (governments talking to each other, often via “experts” and specialised “agencies” nowadays) is global.
In this world economy with no world government, minor powers like most eastern European, African, and Latin-American States have to remain open to global flows of goods and capital investment. Due to trade and capital dependency, these small States are run by money. Minor powers are collectively too weak to revise trade rules in their favour.
Major powers like France, Germany, Russia, Japan, and China are collectively quite strong. But individually, they’re still too weak to change the world economy. That would require a grand coalition of major powers—which seems unlikely, given the intense rivalry between a lot of these States. Major powers, in practice, are run by money.
Great powers, the most powerful States in the system, are few and far between. Perhaps the only great power left is the USA, which isn’t run by money by virtue of global markets, since US demand anchors the world economy, making the dollar dominant and the Federal Reserve the most important financial institution on the planet. This gives the USA leeway to depart from the diktats of global money flows. Other factors make the USA run by money—like inequality, arising from its domestic market, divided political institutions, and uneven legal code.
Money rules the world, lastly, because the rich buy politicians—particularly in the United States. Wealth inequality since the 1970s has skyrocketed, such that the top 0.1% of the wealth ladder possessed a whopping 22% of total wealth in 2012, versus only 7% in 1979 (according to University of California’s Emmanuel Saez and the London School of Economics’s Gabriel Zucman).
Inequality has risen for a lot of reasons, such as the decline in labour unions, the outsourcing of manufacturing overseas, the fall in taxes on the rich, the growth of finance at the expense of other parts of the economy, and the rise in more restrictive policy on interest rates by the Fed. But one crucial reason is the role of money in politics.
The rich use their money to “buy” politicians—through super-PACs, party donations, and campaign financing. The rich also use their money to buy media outlets—which are overwhelmingly owned by billionaires. Media outlets “manufacture consent” for Establishment politics. They do this by giving “flack” to potential anti-Establishment candidates like Bernie Sanders, and rallying people around a common object of terror. This could be terrorists, immigrants, or simply different parts of the country.
The rich are able to buy politicians and voters alike, by bribing politicians directly with money, and by manipulating voters due to private media ownership. The rich use their economic power to buy political power. There’s a term political scientists, since Aristotle, have for that kind of power: oligarchy—rule by the class that has the most wealth, which today comes in the form of money.
Money rules the world, therefore, for three reasons:
1. Production still needs people—work isn’t all automated yet;
2. Markets are global—but governments are national; and
3. The rich buy politicians—particularly in the USA.
But if the world is ruled by money, is it truly free? Or are we little more than slaves to our true ruler: money? If America, and the world, is to be made truly great, the first step is freeing ourselves from the shackles of monetocracy. On this blog, I want to ask how.
Edmund Wilson 