Abstracting framework for monetary values

Fascinating to me functionally defining money as an abstraction enumerating a favor is that you can then more easily frame values in a way that makes sense. Why? Because most I assume do favors for people or receive favors all the time.

Like you give your best friend a ride. Versus your friend calls a service to get a ride.

One thing--you giving the favor--requires no money, while the other, enumerates the monetary value of the favor, which of course you would never charge a friend!

Now then, money lets you monetize favors for strangers, relying on what I call limited social trust, which allows you to trust a stranger to give you a ride, and limits the obligation of that stranger.

But money abstracts a favor which society guarantees will be returned, so if you give a ride for a stranger, using say some modern social company then notice, the money is just a promise that you will get value later. Maybe you will spend that money on a date with your girlfriend, where you will give it in exchange for ambiance and a meal, and the restaurant staff will get their value from it later.

Society guarantees this process. And society has mechanisms in place to keep it going, like prosecuting people who try to print their own money, which is now seen to be trying to steal favors! That is, counterfeit money is a claim that you did something for someone when you did not! So it is simply a lie.

People can claim they have done favors in real life as well, when they have not. And communities learn ways to deal with such things.

So, remarkably, you can look at a person with a lot of money and ask yourself: what favors were done for this wealth? And by whom? And how did it flow?

In a perfect system, which we do not have, and which is an ideal for which we can only strive, every bit of money would trace back to something someone did for someone else in a socially accepted transaction.

Why socially accepted? Because society provides the framework for money, defends the system, and guarantees the promise of a return.

Without society, you need trust, or as I like to say, deep social trust.

So that best friend you gave a ride? You know he's good for it.

Of course in the best society we don't nickel and dime each other over favors. But when someone is just using his friends that rankles.

At our best we support each other to the best of our ability as best we can, within our best society.


James Harris