David Graeber – Debt Seminar

I was rereading David Graeber’s Debt over the weekend. The intervening two years, since our book event, have not caused it to be the case that Graeber doesn’t owe Henry an apology, after all. But the life of the mind goes on. We do not freeze intellectual accounts due to outstanding personal debts. That is to say, the free market of ideas is baseline communist, in Graeber’s sense. If I have a bright idea, I do not expect to be paid back, by those who receive it, in the form of two half-insights – or 100 comments, each containing but a grote’s worth of thought; none of that. (I expect intellectual credit, of course.)

My bright idea for the day is that I have no idea what the difference is between reciprocity and baseline communism. [click to continue…]

A coda to the coda – Mike Beggs’ [piece](http://jacobinmag.com/2012/08/debt-the-first-500-pages/) on Graeber’s Debt in _Jacobin_, and the ensuing discussion in comments [here](https://crookedtimber.org/2012/08/29/debt-the-first-five-hundred-pages/) at CT, has given rise to a further exchange in which J.W. [Mason](http://jacobinmag.com/2012/09/in-defense-of-david-graebers-debt/) defends Graeber on money, and Mike [Beggs](http://jacobinmag.com/2012/09/on-debt-a-reply-to-josh-mason/) restates and extends his position.

Mason:

> Mike sees _Debt_ as “a move in an interdisciplinary struggle: anthropology against economics.” But most of the key arguments of Debt are better seen as part of an intradisciplinary struggle within economics. Admittedly it takes some unpacking, but Debt‘s key themes are in close harmony with the main themes of heterodox economics work going back to Keynes; while the “economics” that Beggs opposes to him represents only the discipline’s more conservative wings. … Debt‘s demonstration that money obligations are historically prior exchange of goods maps onto the insistence of Marx, Keynes and their successors that under capitalism, money values are logically prior to the production and consumption of real goods and services. … Debt‘s distinction between money and credit systems is not just an exercise in classification, but corresponds to a distinction that has has preoccupied many classical and modern economists, and has important implications for monetary policy in addition to the vaster cultural and political-economic ramifications Debt focuses on. … when Mike says that Debt exaggerates the importance of the system of payments, it is because he is coming from a narrowly orthodox view of what monetary economics is about, and why money matters. If your economic vision is shaped by more heterodox traditions — or by the responses to the financial crises of the past few years — the economics of Debt will seem more congenial.

Beggs:

> The debate between Josh and I centers on the question of whether or not the distinction between a ‘commodity/fiat money economy’ and a ‘credit money economy’ is a useful one in understanding our present economic system and its history. He thinks it is so useful as to be the central dividing line in economics; I think it is liable to mislead. The rest of the disagreement comes, I think, because Josh conflates the commodity/fiat-credit money economy divide with other divides in economic thinking. So he seems to that if I challenge that distinction, I must be a quantity theorist, must believe that money is simply a veil, neutral in its economic effects, and must misunderstand how banking works. In fact we are on the same side in all those other dichotomies, but Josh for some reason continues to maintain that if I disagree over the core distinction, I must be standing on the other side of all the others. … I think the ‘commodity/fiat money economy’ – ‘credit money economy’ divide is a problem; and … that the rest of his criticisms rest on the conflations with other theoretical dichotomies.

Given past history, I’m probably not the best person to write disinterestedly about David Graeber’s _Debt_. Still, I think that both critics and fans of his work ought to read this “comprehensive critique”:http://jacobinmag.com/2012/08/debt-the-first-500-pages/ by Mike Beggs in the new issue of _Jacobin._ Begg admires the energy and ambition of the book, but is also blunt.

bq. _Debt,_ then, does not need any more kind words from me. It’s enough to say that there is a lot of fantastic material in there. The breadth of Graeber’s reading is impressive, and he draws from it a wealth of insightful fragments of history. The prospect of a grand social history of debt from a thinker of the radical left is exciting. The appeal is no mystery. I wanted to love it.

bq. Unfortunately, I found the main arguments wholly unconvincing.

bq. The very unconvincingness poses the question: What do we need from our grand social theory? The success of the book shows there is an appetite for work that promises to set our present moment against the sweep of history so as to explain our predicament and help us find footholds for changing it. What is wrong with Graeber’s approach, and how could we do better?

Preliminary throat-clearing: as promised, a reply to David Graeber’s reply below, or rather, to the particular bits of it that concerned me. Before getting into the substance, let me briefly clear up that I won’t be talking at any length about what I think of his general conduct, style of argument in which he claims that serious critics are liars out to delegitimize him and so on. As you may imagine, I am very unhappy with his behavior – but I also believe that for purposes of analysis one ought to separate the person from the work. Worse people have written better books. I will, however, note (since Gabriel Rossman is too nice to do this himself) that Graeber’s account of their Twitter interactions is extremely tendentious, to the point of being more or less unrecognizable to me.

Warning: what comes below is rather long. The first section will look at the specific complaints in Graeber’s reply, each in its turn. The second will return to the book chapter in question. The third will look at broader issues of how to study imperialism.

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Let me begin with an apology—for two things, actually. First, for the fact this response to the seminar on my debt book was so long in coming. It happening that at the time the seminar was going on I was desperately trying to finish a book with a very firm deadline (not to mention I was also struggling with a flu, which added all sorts of interesting complications. I did finish it though. Only just.) Second, for the fact that, to make up for the delay, I seem to have overcompensated and the response became… well, as you can see, a little long.

Sorry.

Allow me also to remark as well how flattered I am by so much of this discussion. When I wrote the book it never occurred to me I would end up being compared with the likes of Polanyi, Nietzsche, or even Ernest Mandel. I shall try very hard not to let this go to my head. Now how shall I start? It would be ungracious not to respond to each in some way. But I think it might be best to start by clarifying a few issues that seem to crop up pretty frequently, both in this seminar and in other reviews and comments I’ve seen on the internet. Then I will take on the specific responses.
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Fortunately I didn’t contract with Chris in advance to contribute to the Graeber seminar, so I’m not in debt on this score, paying late and therefore a bad person.

Right. I’m only about halfway through the book – on audiobook: must have something to do on the bus – and quite enjoying it. Some skepticism about Graeber’s scholarship has been expressed in the wake of revelation of that embarrassing bit about Apple computers that he got totally wrong. I am not an expert on all the ancient and exotic anthropological and etc. evidence Graeber cites, but I’m not an absolute beginner. I started studying the history of ideas of debt, and related subjects, a few years back. See here and here. I started because it occurred to me the Plato I was teaching was, to a surprising extent, about debt, reciprocity and, generally, the convertability of moral into monetary categories, and vice versa. Euthyphro on piety. It’s ‘care of the gods’, which – this is his final suggestion – turns out to be the capacity to enter into healthy exchange relations. Meno on whether being good boils down to getting your hands on the goods. Cephalus, the old man, launches the mighty ship, Republic, with the thought that justice is ‘speaking truth and paying debts’, which morphs into the lex talionis thought that justice is payback – doing good to friends and harm to enemies. Plato, like Graeber, is really really concerned to shred this stuff, if he can. So I find Graeber interesting. I haven’t gotten to the bits where Graeber discusses Plato, but I see he does discuss him. And I haven’t found any flagrant inconsistencies between what he says about other ancient stuff and what I have read in other authors about ancient stuff. So I’m inclined to think the Apple slip was a one-off accident, not indicative of larger problems. As to the tribute system stuff. It sounds like Henry is right about that and Graeber is wrong. I haven’t gotten to that part of the book yet.

Right. Getting down to business. Here’s what seems to me a fundamental tension in the book. On the one hand, Graeber wants to emphasize that debt is a very specific relation. Everything isn’t debt, human relations-wise. More generally, everything isn’t exchange. For him, this is the larger significance of defeating the myth of barter and the double-coincidence and all that (go read the other posts if you don’t know what I’m talking about.) Money emerges as a way of accounting for debt, but not everything is debt. So money isn’t a way of accounting for everything. I’m simplifying, but this is the gist. (One of many gists, but enough for one post.) [click to continue…]

We’ve now received and published all the contributions in our online seminar on David Graeber’s _Debt: The First 5000 Years_ . For those wanting a handy index the posts are:

Chris Bertram, “Introduction”:https://crookedtimber.org/2012/02/22/seminar-on-david-graebers-debt-the-first-5000-years-introduction/
John Quiggin, “The unmourned death of the double coincidence”:https://crookedtimber.org/2012/02/22/the-unmourned-death-of-the-double-coincidence/
Henry Farrell: “The world economy is not a tribute system”:https://crookedtimber.org/2012/02/22/the-world-economy-is-not-a-tribute-system/
Barry Finger “Debt jubilee or global deleveraging”:https://crookedtimber.org/2012/02/22/debt-jubilee-or-global-deleveraging/
John Quiggin (slight return): “The end of debt”:https://crookedtimber.org/2012/02/22/the-end-of-debt/
Neville Morley: “The return of grand narrative in the human sciences”:https://crookedtimber.org/2012/02/22/the-return-of-grand-narrative-in-the-human-sciences/
Malcolm Harris: “The dangers of pricing the infinite”:https://crookedtimber.org/2012/02/23/the-dangers-of-pricing-the-infinite/
Daniel Davies “Too big to fail: the first 5000 years”:https://crookedtimber.org/2012/02/25/too-big-to-fail-the-first-5000-years/
Lou Brown: “Good to think with”:https://crookedtimber.org/2012/02/26/good-to-think-with/
Richard Ashcroft: “Money out of place: ‘debt’ and incentives”:https://crookedtimber.org/2012/02/26/money-out-of-place-debt-and-incentives/
Rob Horning: “Debt on the 12th planet”:https://crookedtimber.org/2012/02/28/debt-on-the-12th-planet/

Stay tuned, as we’re hoping that David Graeber will be able to write a response to some of this soon, but that won’t happen for at least a week or so.

In his 1976 book The Twelfth Planet, independent scholar Zecharia Sitchin drew on his heterodox studies of archeology, biology, anthropology, and ancient Sumerian to put forward the thesis that an alien race from the planet Nibiru came to earth thousands of years ago and enslaved the human species and forced them to mine precious metals, instilling in our ancestors a religious respect for metallurgy and an insatiable love for gold. As I remember it from Sitchin’s appearances on the Art Bell show in the 1990s, the original political hierarchies in ancient times derived from the appointed intermediaries to the Nibiru people (known in various human mythologies as the Nephilim or the Annunaki); these became the earliest human kings, with access to supernatural power that justified their rule, the purpose of which was essentially to expedite the greatest amount of precious metal extraction possible.
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My interest in David Graeber’s extraordinary book “Debt: The First 5, 000 Years” stems from my work on incentives in healthcare. I don’t have much to say about debt and political economy. On these matters I am an ordinary citizen-punter and the most sophistication I can muster is to parrot John Lanchester’s better lines. But I know a little bit about incentives, and here I want to say a few things about the connections.

The current debate about incentives in healthcare can be split in half. One half concerns the use of incentives to motivate professionals and institutions to provide better, or different, care and services to patients and clients, citizens and customers. This is a very important debate, with roots in Adam Smith’s suspicion of professions as conspiracies against the public, the public choice theorists’ suspicion of regulation by rule-making, and the management consultant’s belief that people’s behaviour at work is driven principally by the available rewards.
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On a recent edition of the public radio show “The Story” (air date February 21, 2012), the interviewee, Kenan Trebincevic, a Bosnian Muslim, describes the relationship his family had with a neighbor woman, Petra, a Bosnian Serb. Muslims were being rounded up and placed in concentration camps, and Trebincevic’s family lived in fear. Petra would stop by for a visit, commenting to Trebincevic’s mother, “I like your rug,” or “That’s a pretty dress.” She would then invite the mother over for coffee, all the while talking about how nice the rug would look in her apartment or how good the dress would look on her. Within a context where Petra was known to have betrayed other Muslim residents to patrolling soldiers, Trebincevic says Petra’s message was very clear: “Either agree with what I’m asking you to do, or I’m going to turn you in.” His mother would dutifully fold up her rug or her dress or whatever other possession Petra had tacitly demanded, and give it to her neighbor when she went for coffee. This is an example of a type of relationship David Graeber describes as constitutive of a human economy, an economy “concerned not with the accumulation of wealth, but with the creation, destruction, and rearranging of human beings” (p. 130). In this case, Petra is demonstrating that Trebincevic’s mother owes her a debt that can never really be repaid. The mother must continue to make payments, with both parties fully aware that no payment will ever be enough to match the value of the original “gift”, the lives of Trebincevic’s father and older brother. This story also resonates with another of Graeber’s key points, the role of violence in the creation of a system in which human lives can be thought of as objects of exchange. [click to continue…]

“The notion of infinite debt comes in when this logic slams up against the Absolute, or, one might perhaps better say, against something that utterly defies the logic of exchange. Because there are things that do. This would explain, for instance, the odd urge to first quantify the exact amount of milk one has absorbed at one’s mother’s breast, and then to say that there is no conceivable way to repay it.”
– David Graeber, Debt

“Could all of this be thought ‘a normal upbringing’? Everyone seemed to think so and my parents, bless them, paid for it. So much that my father proudly presented me with a complete set of receipts on my twenty-first.”
– Derek Jarman, At Your Own Risk

It’s worth stating from the outset that this seminar and the rest of the deserved attention this book has received in all likelihood would not have occurred if we weren’t in a sequence of global debt crisis. David’s status as an “out” anarchist and the role that alignment plays in his theory and practice would most likely have (continued to) exclude his ideas from these kinds of forums under more stable circumstances. But these are not more stable circumstances. For that reason I want to leave the scholarly refutation to the scholars, and put the book to work.

In April of last year I wrote an article for N+1 on the astronomic growth of student debt in America since the 70s. At the time, student loans had just passed credit cards as the largest source of consumer debt at $800 billion. Less than a year later, the total has topped $1 trillion with no real signs of slowing, while the other measures I referenced, including youth unemployment, have increased to new record levels as well. The conclusion that “the most indebted generation in history is without the dependable jobs it needs to escape debt” is more valid than ever.
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David Graeber’s Debt is, in the most positive sense, rather an old-fashioned book, in its conception and approach if not in its matey and approachable style.  It ignores disciplinary boundaries within the human sciences, especially those between economics, history and social studies, in a manner that recalls polymaths like Max Weber or the free-wheeling early years of political economy with figures like Smith and Malthus.  In its search for the connecting thread between an astonishing diversity of cultural practices and texts from across time and space, it resembles the early classics of speculative anthropology – not Malinowski but J.G. Frazer.  In its ambition to offer an account of the trajectory of the whole of human history, it undoubtedly runs the risk of being confused with the likes of Jared Diamond or Niall Ferguson, but it strikes me rather as in the vein of Arnold Toynbee, not least in the weight of scholarship that underpins this work of imaginative reconstruction. I feel the need to stress again that I don’t offer these comparisons as a criticism…

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In ordinary language, a debt is a morally and legally binding obligation to (re)pay somebody. But that’s not the only commonly-used definition of debt. In corporate finance, “debt” refers to a class of securities with a fixed interest payments, senior to equity in claims on assets. Until late C20, this description carried with it much of the freight associated with the ordinary definition – failure to repay debt would involve the end of the corporation as a legal person, so any honest and prudent corporate manager sought to avoid this, and to keep a good credit rating. That all changed with junk bonds and Chapter 11 – corporations now routinely restructure, to wipe out debt (particularly debt owed to employees).

Then there’s sovereign debt, which has always been a special category. Historically, loans to sovereigns debt were more like the reciprocal obligations described by Graeber than like the debts owed by subjects to sovereigns. If you lent to a king (your own, or a foreigner) you gained favor, and hoped to be well paid, but couldn’t do much about it. That attitude extended more generally to aristocratic debtors (exemplified by Becky Sharp and Rawdon Crawley in Vanity Fair).

What happens when this view of debt becomes more general As I’ve written previously, current trends imply that most Americans will sooner or later go bankrupt, and of course millions more have defaulted on mortgages in the current crisis. For most of those involved, this event has been catastrophic, and has carried with it a burden of shame and guilt. But, as with divorce, it’s hard to maintain a moral stigma for a life-event that is so commonplace (the fact that bankruptcy is private, while divorce is public, cuts both ways here).

I don’t have an answer on this, only a question. If everyone treated debt as a financial instrument, to be managed in whatever way suited them, how would/will society and the economy change?

Fifty years ago, another ambitious examination of historical development was published. This too drew abundantly from “economists, economic historians, ethnologists, anthropologists, sociologists and psychologists” in order to elucidate patterns of social existence and institutional evolution. This too promised to locate in the remote past of humanity, experiences that have “penetrated into unconsciousness of individuals, there to encounter the echoes from the primitive-communist past, which have never been completely buried by the effects of 7000 years of exploitation of man by man.” This too argued, in effect, that a lost social consciousness would be key to the reassertion of a future freed from economic oppression. David Graeber asserts that communism is in fact one of the basis for all human societies. But, while Ernest Mandel’s Marxist Economic Theory was written in the context of a cold war in which the fundamental question of social organization was ever present, David begins his quest 2000 years beyond the mist (and myth) enveloped origins of ancient communalism to the beginnings of society already differentiated by class and social function. The current social context is one permeated by a crushing global financial collapse, where – unlike Mandel’s time — the fundamental questions of the class organization of society no longer present themselves as urgent political propositions.
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