David Graeber's Debt and balancing the books: Libra, Michaelmas, the Days of Awe

by Doctor Science

In my last post I mentioned some things I was disappointed by in David Graeber's Debt: The First 5000 Years, but that's not by any means my opinion of the book as a whole. Indeed, I found it fascinating, mind-opening and for the most part convincing in its core thesis: that money did not arise out of barter, as the story is usually told, but out of debt. Graeber argues that debt as a social obligation is much older and more universal than money, and he demonstrates it with wide-ranging knowledge of history and anthropology.

One of the many insights I got from the book was into the nature of the Jewish High Holy Days, the "Days of Awe". Not because Graeber discusses them specifically, but because of this passage, describing Early Modern England (based on the work of Craig Muldrew):

In a typical village ... everyone was involved in selling something, however just about everyone was both creditor and debtor; most family income took the form of promises from other families; everyone knew and kept count of what their neighbors owed one another; and every six months or year or so, communities would hold a general public "reckoning", canceling debts out against each other in a great circle, with only those differences then remaining when all was done being settled by use of coin or goods. [Debt, p.327]

Graeber notes that "the circular cancellation of debts in this way seems to have been quite a common practice in much of history" [p.400-01], though he gives no other details.

When I read Graeber's description of a yearly circular debt cancellation, I immediately recognized the Days of Repentance.

Book of Life painted metal sculpture by David Kracov.

For those of you who aren't Jewish: Rosh Hashanah is New Year's Day; Yom Kippur, the Day of Atonement, is 10 days later; the period that includes them both is called the Days of Repentance. The overarching metaphor for this period is expressed in the prayer Unetanneh Tokef:

On Rosh Hashanah will be inscribed
and on Yom Kippur will be sealed
how many will pass from the earth
and how many will be created
who will live and who will die ...
But Repentance, Prayer, and Charity avert the severe Decree

The Book of Life for the year is opened on Rosh Hashanah, but it's only a rough draft until it is "sealed" at the end of Yom Kippur. So the days in between are for charitable giving, prayer, and also for reconciling with anyone you may have harmed or angered in the past year. The solemn and moving Kol Nidre is (for many of us) the culmination of this "debt-clearing" process, as we ask to be released from pledges made to G-d that we should never have made, from our foolish promises or "I swears".

What Graeber describes for medieval English villages is what we Jews do before Yom Kippur: canceling spiritual debts to each other in a great circle, and adding prayer and charity to bring our spiritual balance into the black before it's finalized. It's pretty much exactly as in the translation of the Christian "Lord's Prayer" which asks G-d to

Forgive us our debts
as we forgive our debtors

Some years ago, our then-rabbi explained that balancing the spiritual books happens at this time of year -- sometime in September or early October -- because that was the custom in Babylonia, where the month of Tišritum -- equivalent to Jewish Tishrei -- was the start of the fiscal year, under the constellation of Libra, the Scales or Balance.

So at about this point in working on this post I went looking for an illustration, and googled painting weighing scales (you have to put in "weighing" because otherwise it's mostly reptile skin). Look what popped up:

Medieval image of St. Michael, weighing a soul hoping to enter the kingdom of heaven. The devil weighs down the scale on the left while the Virgin Mary weighs down the right with a rosary. source

Why, it's Saint Michael the Archangel, weighing souls! I hadn't realized that was one of his symbols and functions -- I just thought of him as "The Warrior Archangel". And then I remembered Michaelmas, and checked its date.

That's right, September 29. Under the sign of Libra.

In medieval England, Michaelmas marked the ending and beginning of the husbandman's year, George C. Homans observes: "at that time harvest was over, and the bailiff or reeve of the manor would be making out the accounts for the year."

So I fell into a research vortex, chasing St. Michael and his scales.

Spanish art historian Laura Rodríguez Peinado's study of St. Michael Psychostatia (in Spanish with images; English translation, no images) found images of St. Michael with scales from the 10th Century onward, and commonly after the 11th. She traces this representation of St. Michael to Coptic Egypt, where he absorbed the soul-weighing function of Hermes and of Thoth before him.

The scales St. Michael has in Christian artworks are for one-time use, at the end of someone's life if not indeed at the Last Judgment. The scales of Libra and of the Days of Repentance are used every year -- just as the settling of financial accounts comes around every year. And the Last Trump of Judgment Day is an amplification of Tekiah Gadolah, the final shofar blast that ends the Days of Repentance.

And yet, St. Michael's Day is still near the autumn equinox, part of the yearly fiscal cycle. Michaelmas *could* still have some of the quality of the Days of Repentance, with rituals for settling moral debts as well as monetary ones. If St. Michael's scales are only used on Judgment Day, why is Michaelmas part of the fiscal year? I see the Roman indiction or fiscal year began in September, so I'm guessing that scales and balances were already associated with that season in Egypt and the Roman Empire. I don't know how much of this was due to influence from Babylon.

Graeber says it was only in the Late Middle Ages that " all moral relations came to be conceived as debts" [p.330]. But I think the parallel between financial and moral debts must have been clear much earlier, in Babylon of the 7th century BCE at latest, for the scales of commerce and the scales of justice, moral debt and financial debt, to come together in one ritual.

May you be sealed for a good year.

I believe this papercut illustrates Hashivenu, part of the Yom Kippur liturgy. Can any Hebrew-readers help me out? My local Bat Mitzvah finds it a bit too non-uniform for her skills. source.

Comments

[bobbyp]

I see the Roman indiction or fiscal year began in September, so I'm guessing that scales and balances were already associated with that season in Egypt and the Roman Empire.

Sharp observers will note our federal fiscal year starts on or about the same time. Coincidence? I think not. Time to dust off the Illuminati tin foil hat.

[lily]

I love the layers of history behind current rituals. Events like Michealmas don't mean much to me in terms of modern religion, but do in terms of the layers of human experience in place and time.

[FuzzyFace]

The line at the top says, ham'chadesh b'tuvo b'chol yom tamed maaseh breishis "The one who, in His goodness, renews each day, forever, the work of Creation." The four words in circles around the hamsa (the hand) say Mitsad Ze Ruach CHaim "from this side, a spirit of life." The first letters of those words spell the word MiZRaCH in the very middle, which means "east".

The line at the bottom says, shivisi Hashem l'negi tamid "I place G-d before me, always"

[Hartmut]

I guess it made sense to connect the fiscal year to the agricultural one. It would not make much sense to collect taxes before the harvest (at least not before payday loans became a favorite business model of those that also bribed the state).

[McKinneyTexas]

Graeber notes that "the circular cancellation of debts in this way seems to have been quite a common practice in much of history" [p.400-01], though he gives no other details.

Doc, not to rain on anyone's parade, but did the author footnote his factual assertions, such as this one? I ask because slavery, for example, was a significant part of western ancient life, including slavery induced by debt.

This particular discovery--cross cultural and "in much of history" debt cancellation--seems rather remarkable to have just been made. It's the kind of thing historians would, if not agree on, at least have examined carefully, under peer-reviewed circumstances.

To me the evidence seems otherwise. Coinage goes back to BCE. Trade is documented going back millenia BCE. The archeological record suggests trade predates the first known villages and agriculture. Gold was a valued commodity thousands of years ago.

Whether hunter gatherers held chits on each other is a complete unknown, but from before Phoenicia to the present, traders and merchants roamed the Mediterranean and contiguous interiors.

Unless this author's theses have been thoroughly vetted and peer-reviewed, he is better classified as someone who is writing a fairy tale that happens to fit a certain narrative.

[hairshirthedonist]

This is from the synopsis in the Wikipedia entry on Debt: The First 5000 Years:

Graeber lays out the historical development of the idea of debt, starting from the first recorded debt systems that existed in the Sumer civilization around 3500 BC. In this early form of borrowing and lending, farmers would often become so mired in debt that their children would be forced into debt peonage, though they were periodically released by kings who canceled all debts and granted them amnesty under what later came to be known, in ancient Israel, as the Law of Jubilee. Throughout antiquity, the author identifies many different systems of credit and later monetary exchange, drawing evidence for his argument from historical and also ethnographical records, that the traditional explanation for the origins of monetary economies from primitive bartering system, as laid out by Adam Smith, doesn't find empirical support. One feature first observed in this period, though - that of popular indebtedness leading to unrest, insurrections and revolts - will accompany the narrative of the whole book as it deals with the origins of the state, money, interest, taxation and slavery.

The author argues that credit systems originally developed as means of account long before the advent of coinage around 600 BC, and can still be seen operating in non-monetary economies. The idea of barter, on the other hand, seems only to apply for limited exchanges between different societies that had infrequent contact and often were in a context of ritualized warfare, rendering its conceptualization among economists as a myth.

And there's more.

This book is a couple of years old, so there's been plenty of time for peer review. I'd also say it appears not to dispute some of the things you seem to think it does, McKinney. Rather, it seems to offer explanations that differ from the conventional ones.

Are you so quick to dismiss it as a fairy tale because it is at odds with "a particular narrative"?

[russell]

Some examples:

Year of Jubilee, described in the book of Leviticus.

Solon's seisachtheia, circa 6th C B.C.

From the Qur'an:

If the debtor is in difficulty, grant him time till it is easy for him to repay. But, if ye remit it by way of charity, that is best for you if ye only knew.

There's even some stuff in Hammurabi about debt relief for folks who can't repay due to natural disasters etc.

More on debt relief in ancient Mesopotamia and Egypt.

Another discussion of debt relief in the ancient world.

Not my area of expertise, this is just stuff I found on the gizoogle.

But it appears the claim is not without merit.

[russell]

I guess it made sense to connect the fiscal year to the agricultural one. It would not make much sense to collect taxes before the harvest

Yes, and not just taxes, but settling of accounts generally. So, rendering the lord's share under the feudal system (or, sharecropping arrangements in more recent times), paying back loans, etc.

In an agricultural economy, harvest time is payday.

[bobbyp]

McKinney,

I think you rashly guessed at the yardage and grabbed the wrong club there. :) Graeber's opus caused quite the sensation when it came out a couple of years ago. This is not to say that it does not have its critics. They are legion.

So it's not as if this is news. I'd say read some reviews, both pro and con. It is a very interesting topic.

It's been on my reading list for some time.....perhaps the time is now.

[Hartmut]

A bit of reshuffling in my room has (accidentally) brought the book to the top of a stack. This may be the chance to open it at last before it sinks again to the bottom for another couple of years. But that would also endanger the reading of the other books on top of some the other stacks that I actually started.

[McKinneyTexas]

All--I read Russell's links. No footnotes to scholarly works, both with an agenda that fits neatly with the progressive narrative. Sorry, not buying it, and not just because it runs counter to my politics and philosophy. I've been a history buff since I majored in it in college, and my specific periods of interest is the western hemisphere, pre-BCE. The writers, polemicists actually, at Russell's links present as fact a level of detail going back 3500 or more years to a time period when we have only the sketchiest notion of what actually happened. We have the big picture in some places, and some detail in other places, but nothing like what is suggested as established fact in these two pieces.

Like I said, fairy tales.

[russell]

Leviticus?
Solon?
Hammurabi?

It's either there or it's not McK.

I was already familiar with the year of Jubilee, as described in the book of Leviticus. It took about five minutes of looking around to find the references to Solon and Hammurabi.

There are, as it turns out, examples of debt relief, not as a personal matter but as social or legal norms, in the ancient world.

If you wish to make an argument why those particular examples are not relevant to Doc S's point, have at it.

But discounting the historical phenomena as 'fairy tales' doesn't cut it. Likewise dismissing the actual historical phenomena because you don't like what a couple of people infer from them.

You can't wave the actual historical record away.

I'm not invested either way, I was just curious because of my familiarity with the old testament doctrine.

You find the idea implausible, but you have advanced exactly nothing to support your point of view. That's fine, it just doesn't make your case a particularly strong one.

Now you've got my interest piqued, I'm gonna go snoop around in the Roman and early European antiquity areas.

There are folks here who actually have expertise in periods before the modern one, and or in cultures other than ours. Perhaps they'd like to chime in.

[dr ngo]

I have no expertise in the pre-modern period, but my cursory reading of the sources cited leads me to back Russell in this. These are not fully-cited scholarly texts, it's true, but not much on the internet is; certainly nothing on Obsidian Wings! They do refer to specific historical occurrences, and in one of the cases to scholarly texts that are supposedly in support of this. That makes the argument that general debt relief was an occasional feature of European and Near Eastern society the new default assumption, I believe, and McK may wave his hands and intone "fairy tales" as much as he likes, but that doesn't negate these sources. (We haven't jointly pursued the related idea that a certain time of each year, often around harvest, was routinely set aside for the resolution of debts, as described in the passage on Early Modern England.)

Extending this to "much of history," however, is a whole nother ballgame, as they say, since in the excerpts cited nothing is said of the rest of the world - Asia, Africa, and the Americas (and Australia, I suppose). All too typical, I fear, of most generalizations claiming to generalize from "history." McK's own interest is in the New World BCE (not "pre-BCE" ;} ); mine is in modern Southeast and East Asia. I presume he's seen nothing of this, and I have to confess that I don't recall this pattern in my readings on China or Southeast Asia, though I wasn't particularly looking for it. So "much of history" feels like a bit of a stretch.

Having said this, debt certainly plays an important part in Asian societies, and not just an economic one, at least in those with which I am most familiar. Allow me to quote myself, on the "advance system" in the 19th-century Philippines, by which the would-be purchaser of Manila hemp was obliged to pay for it before delivery, or even before harvest:

One cultural function of the system . . . was the creation of patron-client networks. In the ideal Western scheme of things each transaction, like each work of literature, is perceived as complete, with a beginning and an ending, money borrowed and money repaid in full, contracts stipulating exactly how much . . . each party must do, no loose ends. But from the indigenous Asian viewpoint the emphasis in economics, as in drama, was on continuity. A given transaction was only one manifestation of an ongoing relationship; the very act of exchange implied a future exchange. Thus an advance was a means of creating an ongoing patron-client relationship in which the debt was never totally repaid, nor the mutual obligations totally exhausted. The debtor/client was then committed to providing such goods and favors as the creditor/patron might reasonably request, while the patron owed the client protection and such further loans as might be needed. John Foreman [British traveler] was correct when he observed that 'a native considers it no degradation to borrow money; it gives him no recurrent feeling of humiliation or poignant distress of mind. . . . At most, he regards debt as an inconvenience, not as a calamity.' But his indignation was misplaced. The advance system, with its perpetuation of a debt relationship, offered certain cultural advantages to both parties, prestige and influence to the giver, security (and the status of being regarded as credit-worthy) to the recipient.

Source: "Americans in the Abaca Trade" (1984), reprinted in The Bikol Blend , 1999.

I'm not sure what, if anything, this proves, but I hope the citation is scholarly enough for McK not to dismiss it as "fairy tales."

[bobbyp]

Tex,

The book's wiki entry is here.

But why bother. I'll just dismiss Adam Smith, Freddie Hayak, and Milton Friedman for the same reasons you provide. Fair is fair, right? This will save both of us time.

And time is money (no cite).

[Priest]

For more discussion and critiques of the book, I recommend the Crooked Timber Seminar on it from about a year and a half ago.

http://crookedtimber.org/category/david-graeber-debt-seminar/

[Doctor Science]

I honestly have no idea what McT is objecting to in "Debt". Generally speaking, the book is thoroughly footnoted, mostly to sources in the academic literature, such as Muldrew.

Insofar as he as a single thesis, it's that the prehistory of money isn't barter, it's *favors*. Favors within a community create networks of debt and obligation. People start to need money when their groups get too large to be covered by such favors.

Graeber argues that the pivotal development in getting to a currency-based market is government taxation to support an army. Absent a state of that sort, markets use "money of account" to keep track of who owes what.

For instance, I often wondered why the English "pound" had the same name as the old French "livre", even though they have been separate nations for a *very* long time. Both, it turns out, are based on Charlemagne's livre, which was used as a unit of account -- to keep books, not to be exchanged -- for a thousand years, despite the fact that there was no currency to back up those accounts.

Anway, people, if you've read the book, chime in!

[russell]

The other thing I'd say here is that what McK appears to object to - debt cancellation, in the sense of debt forgiveness - isn't what I'm seeing in the excerpt from Graeber.

It looks more like 'debt cancellation' in the sense of I got three baskets from you, but you got a goose from me, plus I helped you slaughter your hogs, so we're even.

If I read it correctly what Graeber is describing is a periodic settling of accounts, with whatever indebtedness remains afterwards being compensated with money or tangible goods.

So, you go through your year, you engage in trade but don't necessarily exchange money at each transaction. On some regular basis, everybody settles up.

This works because everybody knows each other, and to some degree knows everybody else's public business, which generally keeps everyone honest. And, in the context of small to small-ish agricultural communities, it's sort of necessary because folks likely have more to work with in the way of time and goods than they do in cash.

Haven't read the book, so I could be wrong, I'm just referring to the excerpt in Doc S's original post.

If my reading here is in the neighborhood of accurate, this does in fact seem like a pretty widespread phenomenon. I hate to keep bringing up the example of My Old Man And His Rural Folkways, but that kind of arrangement was a large part of how his people lived. My wife's folks, also, at least those among them who stayed on the farm.

Cool post Doc, thank you.

[Slartibartfast]

Insofar as he as a single thesis, it's that the prehistory of money isn't barter, it's *favors*.

Sounds rather a lot like "obs". Which I would think would be rather unobjectionable to Mr. McKTx.

[hairshirthedonist]

What I'd like to see, which I haven't after poking around a bit, is someone present empirical evidence that currency arose directly from bartering to solve the difficulties of barter, primarily the double-coincidence problem. Everything I've seen is theoretical on that front. And it's a logical, coherent, intuitely appealing idea, but that doesn't necessarily make it correct.

It's not that bartering didn't occur. It's not that currency-based money didn't largely end the barter economy that did exist to a far greater extent than it now does. It's that the idea of money arose from the need to assess debts rather than the need to lubricate the markets that were based on bartering.

I haven't read the book, but my understanding from reading about the book is that the author looked for evidence that money arose from barter, as according to conventional wisdom, but he couldn't find it.

Not having read the book, I can't say how well the thesis is supported, but I can say that someone else who hasn't read it can't say that the thesis wasn't supported. What I also can't say is that, if the thesis (or main theme, maybe) as I understand it is correct, that it should lead me to advocate some policy over another. So, yeah, people may base objectionable agendas on the conclusions reached in this book, but it doesn't make those conclusions wrong. And even if those conclusions, if secondary to the main thesis, are wrong, it doesn't make the main thesis of the book, upon which those conclusions were based, wrong.

AFAICT, money arising from barter is an economic theory, not a matter of historical or anthropological investigation. And, like I said, it's an appealing one, which is why it's probably become so entrenched.

[McKinneyTexas]

Graeber notes that "the circular cancellation of debts in this way seems to have been quite a common practice in much of history" [p.400-01], though he gives no other details.

I am repeating my initial extract from Doc's post above. As noted, Graeber gives no other details. Further, a broad, sweeping statement like this without footnotes is highly suspect and almost certainly unsupported by any primary or peer-tested secondary sources.

In googling Graeber and his book, one learns that he is hardly an objective academic, but rather he is very much a partisan of the far left. That may make him all the more authoritative in some quarters, but elsewhere, he looks like a quack. His book is cited by like-minded bloggers for the notion that large scale debt forgiveness is a standard, recurring historical occurrence. Factually, this is BS.

If this were the case, it would have been noted long ago by people who, you know, make their living at being historians. There is a whole subset of history known as "economic history". Graeber is nowhere close to settled history in his assertions.

As for Solon, Leviticus and Hammurabi, Solon was a one-off result of unique circumstances in Athens. One might was well cite the American Revolution for the proposition that revolutions end in democracy. Leviticus says what it says: whether it is historical fact, allegory, etc is a matter for debate. I read as much as I could about the Code of Hammurabi and what I read jibed with my dim memory from college--it is anything but the proto-progressive model Graeber and his fans would have it be.

If someone can quote me the specific Code provision that granted widespread debt relief, have at it.

Insofar as he as a single thesis, it's that the prehistory of money isn't barter, it's *favors*

This may be a part of his thesis, but he and those who cite him are committed to debt forgiveness, and not as a voluntary act, but rather as something compelled by the state.

That said, if you look at the Code of Hammurabi and what it implies about the complexity of Babylonian society almost 3800 years ago, there is nothing in the Code which supports this notion. The farther back you go in time, the more incomplete the record becomes until it fizzles down to grave sites and the neolithic equivalent of garbage dumps.

There simply isn't enough in the historical record to support even the limited assertion you say he is making.

Graeber argues that the pivotal development in getting to a currency-based market is government taxation to support an army. Absent a state of that sort, markets use "money of account" to keep track of who owes what.

And how does Graeber know that governments first taxed to support an army? Has he looked at the remnants of the Ur and subsequent early civilizations? Religion and temples were at least as significant a government undertaking as war. Moreover, war then, as now, was both defensive and offensive. The luxury of peacefully planting and harvesting crops free from outside interference simply wasn't there. In fact, it was historically nonexistant until only very recent times and then only in some parts of the world.

If Graeber had done his homework, he would know that the recurring reality of western civilization is invasion and often conquest by tribal/folk movements, mostly migrations from east to west or north to south. The Roman empire produced a lull in that pattern for that part of the world it controlled, but eventually Rome too succumbed to migrating tribes.

[hairshirthedonist]

I just found a NYT review that focuses almost entirely on debt forgiveness as the main thesis of the book, rather than where money came from. While I think debt forgiveness makes economic sense under a number of circumstances, the history of it doesn't get me a juiced as that of where the idea of money came from. Maybe McKinney and I are just on about two different things.

[liberal japonicus]

In googling Graeber and his book, one learns that he is hardly an objective academic, but rather he is very much a partisan of the far left.

That's interesting, cause what I know of the book was the discussion at Crooked Timber, which is pretty amenable to people on the left, and it got pretty heated. While there were a lot of undercurrents there, and often times, the most bitter fights are between people who are on the same side of the political spectrum, but differ in small points, I'm not sure your claim is true. I haven't read the book, so I don't know if compelled debt forgiveness is part of it, but it seems like your knee is jerking a bit.

If Graeber had done his homework, he would know that the recurring reality of western civilization is invasion and often conquest by tribal/folk movements, mostly migrations from east to west or north to south.

I'm not sure if I get this, and I'm not sure how you are are classifying western civilization. If it is east to west, I'm not sure who is doing the conquering if you define it as Europe. Or is Western civilization the successful defense from incursion? If that is the case, I'm not sure if I understand the north to south reference.

[hairshirthedonist]

And how does Graeber know that governments first taxed to support an army?

From the wikipedia entry (again - sorry!):

The extreme violence of the period marked by the rise of great empires in China, India and the Mediterranean was, in this way, connected with the advent of large-scale slavery and the use of coins to pay soldiers, together with the obligation enforced by the State for its subjects to pay its taxes in currency.

I don't think the point was that this is what originally lead to taxation in any form, rather that it lead to taxation specifically through the use of coinage (or currency).

[russell]

If someone can quote me the specific Code provision that granted widespread debt relief, have at it.

The claim (on my part) was not "widespread debt relief", but simply debt relief.

The specific code provision is item 48 from here:

If any one owe a debt for a loan, and a storm prostrates the grain, or the harvest fail, or the grain does not grow for lack of water; in that year he need not give his creditor any grain, he washes his debt-tablet in water and pays no rent for this year.

So, if you incur a debt but are unable to repay due to circumstance beyond your control, your debt is forgiven.

Assuming, of course, that you wash your debt-tablet in water.

It seems to me that there are two things on the table:

1. A claim by Graeber that some kind of "circular cancellation of debt" is historically widespread, where for "cancellation of debt" we can read "an accounting of the value of mutual favors rendered and obligations undertaken".

2. Widespread cancellation of public or private debt as an act of public policy.

It also seems to me that McK is objecting to (1) under the mistaken understanding that Graeber was making the claim that (2) was what was quite common in human history.

At least I think that's what's going on.

The kind of practice described in (1) seems, to me, not only common "in history", but among any circle of people who are known to each other, and who engage in any kind of give and take involving anything of value. Certainly in any kind of agrarian culture, where goods and services are more available than cash, and where payday comes at most a couple of times a year, it must be dead normal.

From my somewhat perfunctory googling around, I would also say that (2) pops up *a lot* in the historical record, usually when levels of public or private debt reach a point where it becomes socially disruptive.

It's not a fairy tale, or a weird bizarre invention of modern-day lefties.

[McKinneyTexas]

I'm not sure your claim is true.

Google Mr. Graeber and let me know if you still believe this is the case.

I'm not sure if I get this, and I'm not sure how you are are classifying western civilization. If it is east to west, I'm not sure who is doing the conquering if you define it as Europe. Or is Western civilization the successful defense from incursion? If that is the case, I'm not sure if I understand the north to south reference.

There are various references that can give you a more complete picture than the one I am going to take a shot at giving: Western Civilization traditionally began with the Ur civilization in Mesopotamia roughly 5000-5500 years ago (when I was a college student). Since then, a lot of digging in what is now modern Turkey and elsewhere shows village life going back roughly 11,000 years give or take depending on who is doing the talking. So, "the West" for purpose of my statements is roughly a line running diagonally from modern Iran north to eastern Austria then north through eastern Poland. This is somewhat arbitrary but is generally in line with the tribal migration phenomena.

The time period for (mostly) east to west migration runs from late neolithic to roughly 1000 years ago. Examples, BCE, are the Hyksos, the Celts and the Sea Peoples. This is the tip of the iceberg, but they are names some here may recognize. Tribal migrations from east to west are so thoroughly documented in the archeological and recorded historical record as to be beyond serious dispute. A good example of this, because it is independently corroborated by later events, is the Celtic migration from Central Europe outward and ultimately into England and Ireland roughly 500 BCE give or take. The Celts also moved east during a 300-400 or so year period, but that move was temporary and they were largely pushed west as repeated waves moved from east to west.

As for north to south migrations, Italy and Greece were populated in that fashion. The Sea Peoples moved in that direction, the Danes into England, ditto.

[McKinneyTexas]

If any one owe a debt for a loan, and a storm prostrates the grain, or the harvest fail, or the grain does not grow for lack of water; in that year he need not give his creditor any grain, he washes his debt-tablet in water and pays no rent for this year.

I suspected this was the example of debt relief you were referring to earlier. It is not debt relief and it certainly isn't circular. It was a law that apportioned 'risk of loss'--a common commercial concept--in the specific area of renting one's land to another for agriculture. Rent was not owed if the crop failed. This is not debt forgiveness in any meaningful sense, it is simply an early version of force majeure. Anyone who owned land and wanted to rent it out knew the deal in advance.

where for "cancellation of debt" we can read "an accounting of the value of mutual favors rendered and obligations undertaken".

Ok, is 'cancellation' synonymous with 'repayment' here? I don't think that's how Graeber uses the term. Yes, if I pay back a loan, I cancel the debt. I accomplish that by discharging my obligation. Graeber is being cited, as I said before, for the proposition that there is a notable degree of historically precedented cancellation of debt by fiat as opposed to repayment.

There may be recent examples of default, but cancellation? I'd like to see examples of that.

[Hartmut]

Looking at Roman historians it seems that they attribute calls for debt relief to each and every revolutionary and count that as their main bait to get the unwashed masses to support them. Often it is also implied or explicitly stated that the main drivers of those revolutions were themselves drowning in debt and that it was their primary goal to get rid of their own (everything else just being lies and means to that end). Well, Rome's system was dysfunctional enough to a) keep that problem a permanent threat and b) to know only one (always only temporary) solution: bloody violence.

[Hartmut]

It's news to me that Denmark is to the North of Britain ;-)

[hairshirthedonist]

I thought the circular debt cancellation was just a netting out of debts among a group. The simplest analog would be Bob owing Bill $10, while Bill owes Bob $4, netting out to Bob simply owing Bill $6.

Now, if you have 20 people involved, all owing each other different stuff from exchanges at different times, you get together and simplify it all as much as possible by netting out and transferring as best you can. Maybe you get all the guys who borrowed chickens to owe each other to make the netting out simpler - same for goats, same for bushels of grain and same for whatever else.

If I owe russell a goat and McKinney a chicken, but McKinney owes me a goat and russell owes me a chicken, I'm even. But now russell owes McKinney a chicken and McKinney owes russell a goat. We just went from 3 parties to 2, and from 2 goats and 2 chickens down to 1 of each.

Is anyone else hungry?

[Hartmut]

After WW1 Germany had to pay reparations to Britain and France. Britain and France used the money to pay their war debts to the US. And the US lent Germany money to keep the cycle running. In theory that system would have stayed in place up to the 1980ies. For some inexplicable reasons it didn't. But iirc it was in the papers when that theoretical final day came at last. Not as page 1 news though.

[dr ngo]

I haven't read Debt and don't expect to soon - my spare time is devoted to learning Gilbert & Sullivan chorus parts for an October concert - but I've noticed a couple of things in the thread so far, esp. WRT McK's contributions.

1) Graeber is a radical (yes, everyone says this, even lefties who disagree with him), which McK believes disqualifies him as a scholar. On this latter proposition, we must agree to disagree, I suspect.

2) Graeber's work is wielded by proponents of widespread compulsory (?) debt forgiveness, a movement that has gained impetus of late, and that McK seemingly deplores. McK holds Graeber responsible for the sins (in McK's mind) of his followers: His book is cited by like-minded bloggers for the notion that large scale debt forgiveness is a standard, recurring historical occurrence. Factually, this is BS. it is anything but the proto-progressive model Graeber and his fans would have it be.

Now we all know, in our calmer moments, that we cannot simply disqualify any book or philosophy by the extreme uses people have made of it. No, not Marx, or the Qur'an, or the Bible, or The Origin of Species, or Wagner's Ring. If there's a fatal flaw, it must be located in the work itself, not in the excesses of those who follow it.

3) McK keeps chastising Graeber's lack of citations, but a relatively hostile (or at least "unconvinced") review of the book has this to say: it is a book in which endnotes and references make up almost 20 percent of the page count. So it's not unscholarly in that sense. He also tries to appeal to scholarly authority, to people who, you know, make their living at being historians. . . . Graeber is nowhere close to settled history in his assertions. Well, I'm one of those people who made my living at being a historian, and I'm not convinced that someone needs to have done a doctorate and earned a professorship in the field to make useful contributions to it. The more so if the author deliberately sets out to confound "settled history," as Graeber apparently does, trying to write "the sort of book people don’t write any more: a big book, asking big questions, meant to be read widely and spark public debate."

On all these counts I fear that McK's animosity toward debt relief and/or leftists has led him into exaggerations that actually weaken his position. (I'll say nothing for now of his musings on the role of migration in Western civilization, because I'm damned if I can figure out the point he's trying to make.) I have to caution myself not to believe that Graeber is right just because McK's treatment of him is so unfair. ;}

The fact is: I still don't know. I haven't read the book, and my particular historical expertise does not allow me to confidently assess arguments made about it. But most critics who have read it acknowledge that it pulls together an impressive amount of historical evidence that should challenge some of our conventional views about economics, even if they remain unconvinced by its conclusions.

As always, YMMV.

[bobbyp]

dr ngo is citing the review in Jacobin which is a very good read if you're a lefty, and perhaps even if you are not.

[Slartibartfast]

I think Graeber's background as a (radical, anarchist, what have you) may cause him to selectively focus and interpret, but as long as it doesn't result in him getting the facts wrong, I can live with that.

[russell]

Rent was not owed if the crop failed. This is not debt forgiveness in any meaningful sense

Hey, my bad. IANAL, so "you don't have to pay back what you borrowed" sounded like debt forgiveness to me.

Ok, is 'cancellation' synonymous with 'repayment' here? I don't think that's how Graeber uses the term. Yes, if I pay back a loan, I cancel the debt. I accomplish that by discharging my obligation.

Briefly, no, I don't see 'cancellation' as meaning 'repayment' in the brief paragraph that Doc S cites. In that specific paragraph, what 'cancellation' appears to mean is people figuring out what, if anything, they owe each other at the end of some chronological cycle.

There may be repayment if somebody finds they actually owe something, or they may decide that they're even, or close enough to it to not worry about it.

I ground your corn, but you dug my well, so we're good. Something like that.

And it makes sense to do that at particular times in an agricultural economy, because people have the means to settle up at particular times, and not at others.

Mid to late September is payday, in the temperate latitudes of the northern hemisphere.

They probably did / do this stuff in March south of the equator.

That's my reading.

I can't speak to what Graeber means by 'cancellation' in any other context because I haven't read his stuff, and am otherwise unfamiliar with his work.

Graeber is being cited, as I said before, for the proposition that there is a notable degree of historically precedented cancellation of debt by fiat as opposed to repayment.

Again, I'm not seeing that. I don't see it in the brief bit of Graeber that is quoted above, nor do I find it in Doc S's very thoughtful post.

I see interesting analogies being drawn between the social institutions of mutual reckoning of both moral and financial debt as they appear in different places, times, and contexts.

I do not see a discussion of, or an advocacy of, mandatory forgiveness of financial debt by state fiat.

I see you arguing with mandatory forgiveness of financial debt by state fiat, perhaps because you have a bone to pick with Graeber, for reasons outside the scope of Doc S's post, but with the possible exception of me I don't see anybody arguing the other side.

And I'm not even arguing the other side, I'm just saying that, contrary to your claims of 'fairy tales', mandatory forgiveness of debt by state fiat is not unknown in human history.

In fact, it pops up fairly often, not usually as the normal way to do things, but rather as a specific action to address a specific issue.

The exception being the Year of Jubilee, which was more of a recurring practice.

Or, at least, intended to be so, the prophets leading up to the captivity have relevant things to say about that.

[CharlesWT]

Debt: The First 5000 Years (.pdf)

I can't tell if this is legit free copy of the book or not.

[Doctor Science]

Those of you who guessed that the circular debt cancellation Graeber describes is getting a "net" for the community are correct: he's talking about a yearly exercise is cancelling debts out against each other.

I assume that McTX will agree that this is a widespread and reasonable practice. My only quibble was that I'd like documentation of it being done at a set time of year, *as a community* -- which has the advantage of making the process go much quicker, but the disadvantage (in some eyes) that no-one debts are secret.

[liberal japonicus]

Google Mr. Graeber and let me know if you still believe this is the case.

I did when the discussion started up at Crooked Timber, but my point is that at CT, where lots of people of leftish persuasion hangout, the reaction was by no means laudatory. That might have you reconsider whether Greaber's ideas are something firmly in the mainstream of the left.

[Doctor Science]

About the Jubilee and similar broad debt-liberation events:

Graeber has masses of historical documentation about this, really. It's not clear that it was every done as regularly as the Jubilee regulations imply, but it certainly did occur from time to time historically.

McTX is wrong that about the Hammurabi cite being necessarily about rented farmland. "pays no rent for the year" means "pays no interest for the year". This provision, and many others in ancient law codes, are designed to prevent debt peonage and debt slavery, which were *huge* problems. That's why widespread, fiat cancellation of debts was so often a response to times of unrest. The people making the demands weren't trying to get "something for nothing", they were trying to keep from being enslaved.

One important point that Graeber makes is that uncancellable debt, especially the kind that rolls over from one generation to the next, almost always goes along with slavery. Saying that the creditors should never be forced to cancel debts but should only do so of their own volition is to basically give creditors the right to enslave debtors -- but only if they feel like it.

[Nigel]

Michael Hudson's work, which is cited in one of russell's cites, appears worth a look:

http://en.wikipedia.org/wiki/Michael_Hudson_(economist)
In 1984, Hudson joined Harvard’s archaeology faculty at the Peabody Museum as a research fellow in Babylonian economics. A decade later, he was a founding member of ISCANEE (International Scholars Conference on Ancient Near Eastern Economies), an international group of Assyriologists and archaeologists that has published a series of colloquia analyzing the economic origins of civilization. This group has become the successor to Karl Polanyi’s anthropological and historical group of a half-century ago. Four volumes co-edited by Hudson have appeared so far, dealing with privatization, urbanization and land use, the origins of money, accounting, debt, and clean slates in the Ancient Near East (a fifth volume, on the evolution of free labor, is in progress). This new direction in research is now known as the New Economic Archaeology....

McKT will probably think him something of a leftie, but a leftie with serious credentials - and smart/practical enough to have (successfully) run his own sovereign debt fund.

[hairshirthedonist]

Here is a discussion of the book from the NY Review of Books (not NYT, as I wrote earlier), which focuses almost entirely on debt relief. So McKinney doesn't seem to have a beef with something that isn't in the book, though I don't think he's demonstrated anything as being factually wrong.

[hairshirthedonist]

Well, I should say that his beef with debt relief appears to be based on something that is in the book. There was a bunch of other stuff he mentioned that came from I-don't-know-where.

[bob mcmanus]

Michael Hudson's work, which is cited in one of russell's cites, appears worth a look:

Michael Hudson is also prolific, and has a (searchable) blog. He is in my RSS feed, and I have been reading him for years.

I think he might categorize his politics as being old-style progressive, circa 1900. On the radical side of that, maybe. Not Marxian.

I haven't read the Graeber, and don't plan to, although his Direct Action is on my to-read list.

[hairshirthedonist]

Oh, that Michael Hudson! For some reason, it didn't click right away.

(Linking directly to the comment doesn't seem to be working, so see Posted by: hairshirthedonist | February 18, 2011 at 10:49 PM referring to Posted by: bob mcmanus | February 18, 2011 at 03:37 PM. That is, if you care...or I could just quote myself 2-1/2 years ago: "The Michael Hudson blog bob mcmanus linked to is fabulous.")

I haven't read him in a while, but used to at New Economic Perspectives when he was posting his stuff there frequently. He's awesome. For whatever reason, I re-directed myself at some point to NEP, rather than his blog. I'll have to get back to his blog directly.

[dr ngo]

The NYRB "review" of Debt linked to by hairshirthedonist a few hours ago is not really a review. Robert Kuttner, described by Wikipedia as "a liberal American journalist," simply uses the book as a pretext to write a lengthy essay in favor of debt forgiveness. You may or may not find the essay convincing, but it should not - I would hazard a guess - be used as a guide to what the book itself is "about."

[hairshirthedonist]

I agree. The first time I read the NYRB, um, article, I only got about 2/3 through it and assumed he would, at some point, get back to, you know, the book. That's why I didn't call it a review, but a discussion, in my recent comment. It's also why I didn't write that debt relief was what the book was about, rather that debt relief was in it.

I wonder if McKinney googled Debt and found that, which may be what set him off in the first place.

[bob mcmanus]

The CT book forum dissolved in acrimony over Graeber's final chapter and his assertion that the world pays tribute to the US enforced by the American military advantage. The IR folks, economists, and poly sci mavens didn't like that one.

The Global Minotaur by Yanis Varoufakis, 2013 is recommended for anyone who wants to explore the idea of tribute.

It is a fairly quick and easy read, and is something of a popularization of his (with co-authors) earlier more academic book Modern Political Economics

[liberal japonicus]

Bob, that's probably a better way to describe the discussion, but it seemed like there were some other disagreements baked in there, but I had neither the time nor the inclination to sort it out. I can understand that McT might not like the suggestion of tribute enforced by military advantage, but I don't think it's fair to claim that is something that defines the left as a group.

[hairshirthedonist]

Dead thread? Maybe. But I'm going to put a little Michael Hudson out, just because reading him again reminded me of how much I like reading him.

First, something most relevant to the post and subsequent thread:

But what is “liberty”? America’s Liberty Bell is inscribed with a verse from Leviticus 25: “Proclaim liberty throughout all the land, and to the inhabitants thereof.” The biblical Hebrew term was d’r’r (deror), cognate to Babylonian andurarum used by rulers to annul the population’s personal and agrarian debts, liberate bond-servants and restore self-support lands to citizens who had forfeited them to foreclosing creditors or sold them under distress conditions. These royal Babylonian proclamations evolved into the Jubilee Year that Judaism placed at the center of its religion in an epoch when rulers had come to protect rather than check the power of creditors and absentee landlords.

Liberty in today’s world has come to connote freedom for predators to exploit the economy at large, in contrast to the Enlightenment’s idea of freedom from the rentiers. A free market is said to be one in which government regulation is dismantled, “free” of public protection of consumers. Such protection has been re-christened “interference” and characterized as the Road to Serfdom. Diderot’s “greatest good of the people” has come to be defined as wealth and output that accrues mainly to the rentiers whom France’s Physiocrats and fellow reformers set out to tax. Today, the taxation of landed property and finance is deemed an encroachment on the liberty of wealth.

Here's something more on economic rent:

Classical economists defined rent as unearned income, a property claim that did not reflect a corresponding expenditure of labor, which was the sole source of value. But as our postindustrial society has evolved into a “service economy,” the national income and product accounts count interest and rent as a product – an output of services. Landlords thus are depicted as providing a useful service, not merely charging access fees for sites created by nature and given value by the community’s overall prosperity. The classical value judgment that deemed some business activities unproductive – or even “sterile,” as France’s Physiocrats put it – has been rejected by today’s value-free economics.

This one gets at one of my pet peeves with economics, or maybe economists, or both (garbage in/garbage out?):

Universities have followed “free-market” economists in taking refuge in a mathematical mode of expression, aping the natural sciences’ use of higher calculus as a means to conceal the over-simplifications of their assumptions. One might say that the more complex the math, the more simplistic and banal the relationships being drawn tend to be. The aim is to imbue mathematical symbolism with the sanctifying role that Orwell observed was once afforded by Latin. The economic curriculum effectively has been turned into an advertisement for the rentier claims – the economic overhead of rent and interest payments – almost as a “law of nature” as Diderot and his contemporaries had put it.

This one's for russell:

Adam Smith (1723-90): Campaigner against public debts and the wars that gave birth to the taxes to carry their interest charges. In a typical if bitter irony of history, Smith’s opposition to war taxes has led neoliberal economists to appropriate him as the patron saint of free markets. Yet he accused landlords of reaping where they had not sown, and business men of forming predatory schemes wherever they were able. The moral is that if one is to select a patron saint, it is wise to co-opt a well-known icon so as to forestall opponents from citing his authority. (He criticized Dutch finance and applied the term Invisible Hand to the workings of laissez faire.)

And this makes me think of Mitt Romney, job-creator at large:

Asset stripping: Corporate raiders take over companies, cut back research and development spending and other lines of business that do not produce short-term returns, and downsize their labor force in order to make the remaining employees work harder to pick up the slack. This practice is euphemized as wealth creation when its effect is to improve reported earnings. This raises stock prices over the short term, but undercuts long-term growth in production and competitiveness. (See Free Market.)

Good stuff.

[bobbyp]

Good stuff indeed. Maybe if you could find a way to tie guns or drones to this topic you might strike a spark.

[Countme-In]

Didn't comment on this thread because of time and because I hadn't read the book.

Have started it ... now on page 87 of my 391-page copy. I read a chapter a day, in the living room, for those who wonder what room I use for books of great heaviosity.

Just would note, without commenting on what I think about Graeber's thesis beyond that its observations seem to be based on wide reading and an ability to reconsider long-held beliefs about fundamental assumptions, that my 393 pages are footnoted 881 times (listed at the end over 60 pages, and the bibliography (which doesn't include Lefty Monthly), carry on for another 37 pages.

So, we can conclude, unless the book is a complete put-on, that homework was done (not that Graeber is correct in his thesis or in the conclusions he derives from the evidence) and that as a lefty, he at least has done what so many conservatives criticize lefties for, which is having their heads stuck in books a lot of the time.

Michael Hudson, whom I've not read, but will, is cited 17 times across the full text, footnotes, and bibliography.

[Countme-In]

Additionally, my copy of Adam Smith's "The Theory of Moral Sentiments" is footnoted not once, although some 86 writers/thinkers are referred to in the text.

I don't have a copy of The Wealth of Nations (just ordered from Amazon) but I found this quote just begoogling a minute ago:

"The problem is that he originated nothing that was true, and that whatever he originated was wrong; that, even in an age that had fewer citations or footnotes than our own, Adam Smith was a shameless plagiarist, acknowledging little or nothing and stealing large chunks, for example, from Cantillon. Far worse was Smith’s complete failure to cite or acknowledge his beloved mentor Francis Hutcheson, from whom he derived most of his ideas as well as the organization of his economic and moral philosophy lectures. Smith indeed wrote in a private letter to the University of Glasgow of the ‘never-to-be-forgotten Dr. Hutcheson,’ but apparently amnesia conveniently"

Harsh, doesn't mean Smith was wrong in his theses, which by the way, Graeber claims some of which Smith made up out of whole cloth without real-world historical evidence, but footnoter he was not.

In this vein, several of the verses/phrases in John Lennon's song "Julia" are cribbed wholesale from Khalil Gibran, but you can still dance to it.

[Countme-In]

Is it news to anyone that David Graeber is a leftist and Milton Friedman is a conservative?

[hairshirthedonist]

Check this out. Here's the intro:

This past May, marked the one hundredth anniversary of A. Mitchell Innes’s (1913) publication of a paper titled, “What is Money?” in The Banking Law Journal. In it, this British diplomat, then living in the US, reviewed the history and usage of money and its forms in credit and coinage. On both historical and logical grounds, he asserts that the “modern science of political economy” rests on a series of assumptions regarding money and credit that are “false.” One of the most important of these assumptions is the belief that “under primitive conditions men lived and live by barter.” Who should we blame for this false assumption? According to Innes, it is Adam Smith (1776), the father of economics, who in turn rests his arguments on the words of Homer, Aristotle, and those writing about their travels to the New World.

I suggest reading it all. It's not very long.

[Countme-In]

The Innes paper is cited early on in Graeber's "Debt".