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The Etherealization of Capitalism

William Irwin Thompson

Cross-cultural trade is as old as the hills. In Neolithic Chatalhoyuk in ancient Anatolia, we find cowrie shells from Jericho, and in Jericho we find obsidian from Anatolia. A by-product of such trade in objects is an exchange of words, ideas, animals, even humans, both male and female. Human intelligence grows as the gene pool grows larger, as the complex system of human culture moves from band to tribe to clan to town to city.

Along with this growth of settlements comes a growth of instrumentalities of exchange from barter to symbolic instruments of value such as cowrie shells. These small objects were revered because they carried, not the face of an Emperor or President, but the image of the generative vulva of the Great Goddess—an icon going all the way back to 70,000 BCE. As the Great Mother was the source of all, she was a good God in whom one could trust.

But a problem arose. When trade expands there simply aren’t enough cowrie shells around to sustain the growing economy, so exchange has to take another step to higher levels of abstraction. Around the seventh century BCE, coinage was established first in India and then in Lydia on the Greek-speaking coast of Asia Minor.  The world of precious Cowrie Shellsmetals—of gold and silver—not as objects of display in drinking cups and necklaces, but as exclusive instruments of exchange began to spread, and the Phoenician trade in the Mediterranean began to expand from the Levant to Spain, and beyond Celtic Galicia to the copper mines of Celtic southern Britain.

The problem that there simply was not enough currency to support an expanding economy arose once more. So people began to cheat by debasing the currency—filing down the edges of coins or using cheaper alloys—as we still do today with our nickels that only contain 25% nickel and our pennies that are merely plated with 2.5% copper. Gresham’s Law that stated how bad money drives out good appeared as a pattern of behavior long before the Tudor economist after whom the law is named was born.

The Chinese took the next step higher in abstraction and invented paper money. And just as the Great Goddess was needed to back up the iconic value of the Neolithic cowrie shell, so was the Emperor and the machinery of the state needed to back up the paper currency. The value of paper money derived from a magical nimbus around writing, so it is not surprising that the first paper money appeared in China where calligraphy was an exalted art.

Chinese Paper MoneyThe next step up in levels of abstraction came when the Renaissance introduced bills of exchange and invented international banking. Learning from the Knights Templar before them, who served to finance the Crusades, Florentine bankers worked with their tiny republic to produce the respectable international coinage of the Florin. But the eternal spring kept bouncing back: an economy will always grow beyond its supply of supportive instruments of exchange, be they bars of silver, gold coins, or slips of paper with the magical presence of writing upon them. What to do?

It was all well and good to put the King’s face on a coin and ridges on its edge to stop cheaters from filing them down, but the French Louis or the Spanish Real could not gloss over the fact that the illustrious crowned heads were the biggest deadbeats in Europe. The kings were always borrowing money from the bankers, the Fuggers and the Rothschilds, to pay for their armies that sustained and expanded their sovereign states.

Since the aristocratic sovereigns were always in debt, it occurred to the practical middle class Dutch to institutionalize debt and make it the ground of the new economy of stocks and bonds. The new ground was not to be land, or the precious metals buried within it, but debt itself—the bonds that tie. In institutionalizing debt, and expanding the volume of economic transactions, the Bank of Amsterdam became rich and then became the model for the new national Bank of England in the Anglo-Dutch culture of the Glorious Revolution of 1688. This step up to an even Coinhigher level of abstraction also involved the reinvention of time. Hitherto, all value had derived from the past: from the Mandate of Heaven in China to the incarnation of Jesus in Christendom or the Magna Carta in feudal England. The past was the source for the validation of human cultures.

In a dramatic shift that amounted to a transformation of worldview, the future now became the locus of value. The future was the phase-space of the new economy when “your ship came in” and you paid off your loan and still turned a profit. Not surprisingly, power and sovereignty also shifted from the king to the Parliament in the revolution of 1688. But such dizzy heights of abstraction and cultural change became too much for conservatives who still believed that all value rested upon the solid ground of land; for the Tories, the size of an economy was the sum of all the rents on the acreage of England.

Although Thomas Jefferson tried to base the American economy on agrarian values—in contrast to Alexander Hamilton who wanted to imitate the Dutch economic revolution of 1688 through the creation of a national bank—he was a very contradictory fellow. He wrote eloquently of freedom, but kept slaves and lived with his own slave children from his mulatto mistress Sally Hemmings.  He spoke of a Republic, but his Louisiana Purchase really set Manifest Destiny and the imperial race to and in the Pacific in motion. Without the Louisiana Purchase, the imperialism of Teddy Roosevelt would have to have been put off for another era.

With the Industrial Revolution and its growth of the world economy by orders of magnitude, the demand for currency might have stumbled along with seventeenth century habits and concepts of slavery and sexism, but along with the New World came new expanding economies of addiction—of sugar, rum, tobacco, coffee, and tea. When past-oriented China with its geometric mentality confronted futuristic England with its dynamical mentality, a global crisis emerged. The Chinese did not care a hoot for the cheap manufactured goods of England and demanded payment in gold and silver for their tea. (When you think of tea, don’t just think of polite ladies sipping tea in porcelain cups; think of working class men, women, and children needing cheap black tea to stay awake in the mines and factories for their twelve hour shifts.)

The idea that gold and silver were somewhere in the Bank of England, backing up the Pound Sterling, was like the Near Eastern myth of Virgin Birth backing up the myths of Christianity; it was something one simply could not question without bringing the whole institution down. Still, one needed some gold in storage to keep up the appearance that every Poppies & Gunsbank note was a symbol of an amount of heavy gold more conveniently stored in a national bank vault.

England responded to this collision of worldviews with China by attacking China with its navy, and seeking to addict the populace by selling them opium from its colonies in India and Afghanistan. It expanded its economies of addiction from rum, tobacco, coffee, and tea to include opium.

By now it has occurred to you that marijuana in Mexico, cocaine in Colombia and Peru, and opium in Afghanistan are still up and running as economies of addiction in which the currencies of exchange are drugs and guns.

Meanwhile, back on Wall Street in 2008, another step up on this increasingly unstable ladder of abstractions was taken in the invention of derivatives and tranches and high-frequency trading. Time was once again re-invented as the phase-space of Now became not a dimensionless point, but a multidimensional tesseract standing precariously on one point of its corners. Cornering the market took on a new meaning as information and speed in manipulating ”the difference that makes a difference” became the foundation for the generation of wealth in algorithmic trading. But if the difference between prices in milliseconds of buying and selling can generate “wealth,” one has to ask oneself what is the meaning of wealth and what is “property” when they are enfolded in invisible topologies of a multi-dimensional world.

Such a multidimensional world of complex topologies is one in which “catastrophe bifurcations” are the pulse of its life. This new world is by definition unstable. As the transactions of traders shift from brokers to computer nerds and outlaw hackers, the ability of anyone to perceive the phase-space is impossible in human time. And the vulnerability of computer banks, like space stations, to electromagnetic pulses, such as the solar maximum predicted for 2012, remains to be tested. Our computer racks and servers are not buried and encased in lead. Conceivably, some Chinese or Russian military satellite privy to information about the instant of a coming solar flare could ride the wave, and while Wall Street and London crash, they could surf the wave to get on top of the catastrophe that wipes out everyone else. Catastrophe trading is a new world that no one now understands; as the early maps of the new world warned when the explorer approached the edge of knowledge: “Here be dragons.”

Computer WallThe hypercapitalists of finance in houses such as Goldman Sachs and AIG in 2008 were so future-oriented in their worldview that pension plans were filled with bonds, based not upon debts to be paid, but bundlings of bad mortgages sliced into purchasable assets. Goldman Sachs became one of the first investment houses to indulge in catastrophe trading when it bet against some of its customers and on a mortgage crisis that could serve itself and its high rollers. (Small wonder that futurist Hazel Henderson calls the world of finance a global casino.) The meaning of property was changed as bad properties became an asset. Value was no longer a solid like gold, or a liquid currency like dollars; it had become a gas, a gas of hot air.

When a hot gas reaches a critical level of heat, a star is born. In this century, I believe, we will reach the flashpoint of ignition of the star of a new economy. We, however, now live in the turbulent time of the phase-shift from one economy and world-view to another.

A hot gas gives birth to stars, and dying stars give birth to planets, providing them with the heavy metals that can sink to the core where they reach the criticality of the flashpoint to create a planetary magnetic field. This magnetic field creates protection from solar radiation; it serves to keep an atmosphere surrounding the planet and protects the membranes of living cells from being destroyed by the sun. Mars, it now seems, may once have had a magnetic field and atmosphere, but in losing one, it also lost the other.

In human culture we are reaching criticality when the Earth will flash with a new economy and a new planetary culture. Rather than thinking of this new economy as a hot gas, we should think of it as an atmosphere. And what an atmosphere does is to enliven creatures by providing the phase-space of their metabolic exchanges. The old capitalist economy was a periodic attractor; it oscillated between the two states of boom and bust, wealth and poverty. The emerging economy will be a strange attractor, a bolt out of the blue, and will become much more like an atmosphere of living processes than a market of physical objects.

In a philosophy of identity in which “You are what you own,” Capitalism assumes that the poor have no inherent right to wealth; they have to earn the right to exist by accumulating property. Communism assumed that the rich had no right to wealth; it was the workers who produced objects and property that, in their definition, belonged to all. “Property is theft,” said Proudhon before Marx became more well-known.

The great experiment of communism failed in the twentieth century because it had a feeble mathematical imagination. It thought in terms of the geometry of empire with its single center of command and control, and its periphery of resources. With this sort of worldview, communism was archaic and Pharaonic, and it was no wonder that it got taken over by genocidal tyrants like Stalin and Mao.

Capitalism outlasted communism because its mathematical imagination was one of complexity and self-organization from noise. From the arts to the economy, capitalism was a noisy and jazzy creative system of innovation and transformation. Ronald Reagan and Cap Weinberger were wild risk takers who decided to play economic “chicken” with the Soviets by outspending them on defense and betting that the Soviet economy would run out of gas before ours would. To bring this development about, these conservatives in name only had to abandon all thought of good old fiscal responsibility.  Reagan shifted to profligate deficit spending as if he were a Democrat like Harry Truman. Reagan and Weinberger guessed that the American economy, stimulated by defense spending, would expand and eliminate the deficit, or at least bankrupt the social democratic state with its maternalistic concerns for health, education, and social welfare. But the deficit exploded without succeeding in destroying the social democratic state. Social Security and Medicare survived Reagan. It took a good old Rockefeller Republican calling himself a Democrat like Bill Clinton to pay off Reagan’s gambling debts. (Notice here how the Republicans are Democrats and the Democrats are Republicans, and then you will begin to appreciate how capitalism is running out of explanations for what it is really doing.)

What the hypercapitalist traders have failed to understand in their manipulations of time is how evolution works. Nature never throws anything away, but acts like a bricoleur junk artist, using old industrial objects to make new artistic architectures. Consider the evolution of the cell with a nucleus. By shifting to meiosis, the cell packs its DNA in the nucleus, but opens itself to novelty by throwing half its genetic endowment away. But such a shift from prokaryotic to eukaryotic cells also came with an integration of the little in the large by matching the acceleration of time in sexual reproduction with an incredibly conservative preservation of mitochondria with their ancient DNA inside the new membrane. The ATP cycle of the mitochondrion produced the energy the larger cell needed and consumed the toxic oxygen that could have dissolved it.

Capitalists who think of physical objects in markets, and hypercapitalists who think of algorithmic trading and accelerations of time and manipulations of price and currency differences do not understand life.  Capitalism as well as hypercapitalism will both fail in this century because a market is not a good model for a planetary ecology. In the shift from economics to ecology as the governing science of a new planetary culture, we will also experience another transformation of values. When something is alive, we do not ask if it has a right to exist and seek to deny it air. We only do so when a life is ending, and we let life takes its course to death by unplugging the respirator of the patient.

From the impact of the coming environmental catastrophes and diebacks of billions of human beings that I think are coming in this century, life will take on a new value. Just as the Black Death almost halved the population of Europe and reduced the work force, so did it also increase the value of the individual. The price of labor went up. So in the not too distant future the shift from an industrial growth mentality of accumulation in an economy to an ecology of symbiosis will enhance the value of consciousness, a consciousness not just of humans, but of the bacteria in our guts, the whales in the sea, and the clouds—thermodynamic and electronic—on our new horizon.

The identity of the individual will derive not from territorial nation-states, but from states of consciousness. The noetic polity will replace the industrial nation-state. The noetic polity will probably be something like a hybrid crossing of what I called the “meta-industrial village” in my 1977 book, Darkness and Scattered Light, a university town and a religious order—something more along the lines of Herman Hesse’s Castalia than Wall Street’s idea of New York.

Like the child of a billionaire, the individual in a noetic polity will inherit upon her birth a fellowship/stipend to support her growth, development, and education. And with this venture Cellcapital, she will invent and invest in new cultural processes in biomes of exchange.

Plastids, chloroplasts, and mitochondria find new roles for themselves inside larger eukaryotic cells. So it is likely that these new evolutionary noetic polities will miniaturize and restructure previous levels of organization. Foraging, gardening, artisanal aeteliers, and Wes Jackson’s agriculture of perennials will replace the fossil fueled factories of agribusiness. Manufacture will through the power of nanotechnologies be scaled down as nature is scaled up with the use and further development of John Todd’s “living machines,” and Sim Van der Ryn’s and William McDonough’s new symbiotic architecture. Thanks to the leadership of David Orr, Oberlin College is already moving down this chreod of evolutionary development.

Outside these superconducting domains of noetic polities, the warlord bad lands predicted by James Lovelock will also probably exist, but history is a spiral and not a circle, so this transitional dark age condition will not be a simple repeat of the previous one. The difference that makes a difference will be consciousness. Our consciousness of the system will affect the behavior of the system.

A transformation of consciousness will dawn on us when we realize, in the etherealization of capitalism, that if money is a consensual instrument—whether cowrie shells, coins, writing on paper, or pulses in a computer–that allows a cultural process to come into being, then one can transcend the physical instrument to proceed directly to the consensual cultural process. This transformation of worldview is like the shift in mathematical mentalities from Arithmetic to Algebraic.

In religious terms, it is like the shift from the economy of men to the ontology of angels, or what the Neoplatonists called the Celestial Intelligences. So on this Epiphany of a new decade, let us think of the wise men bringing the gold of the past, the incense of the present, and the myrrh of the future—to the starchild marking in the zodiacal precession the beginning of a new era.

William Irwin Thompson’s column, Thinking Otherwise, appears monthly in the online magazine, Wild River Review, www.wildriverreview.com.  Wild River Review seeks to raise awareness and compassion as well as inspire engagement through the power of stories.

William Irwin Thompson is a poet and cultural philosopher who has made significant contributions to cultural history, social criticism, the philosophy of science, and the study of myth. Early in his career he left academia to found Lindisfarne, an association of creative individuals in the arts, sciences, and contemplative practices devoted to the study and realization of a new planetary consciousness, or noosphere. Thompson lived in Switzerland for 17 years and describes his most recent work, Canticum Turicum, as “a long poem on Western Civilization, that begins with folktales and traces of Charlemagne in Zurich and ends with the completion of Western Civilization as expressed in Finnegans Wake and the traces of James Joyce in Zurich.” With mathematician Ralph Abraham he has designed a new type of cultural history curriculum based on their theories about the evolution of consciousness. Thompson now lives in Portland, Maine. www.williamirwinthompson.org

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26 January 2011


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Earth, philosophy, transformation, economy, economics, international commerce,
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