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Saturday, January 23, 2010

Money and Virtue

When money is sound, it is a measure of virtue.

What does this mean? Money is sound when it can only be obtained by creating value. Its sole purpose is a medium of exchanging positive values with other people who create value, and storing value for use in the future.

Under these conditions, contempt for money is contempt for virtue.

What is virtue? Simply: is the creation of value.

What, then, is value? At the most basic level, it is simply those things that keep the valuers alive and make their lives more worth living from the standpoint of their personal judgment. This latter clause can lead to inconsistent valuation of given thing between individuals. Rather than posing a problem for the theory of value, this diversity of values allows valuers to more fully explore the space of possible values and keep from getting stuck in local maximums.

Its important to emphasize that there is no single standard of value for all valuers. Each valuer has a potentially unique standard. How then can individuals communicate? How can they exchange values when they have no common language of value between them? This is the function of currency: to communicate personal standards of value between individuals with differing standards.

So: can it be said in our current politco-economic environment that money is sound? Hell no! There are myriad and sundry ways it can be obtained without creating value; just as many (if not greatly more) of them are legally sanctioned than otherwise. Should this trigger contempt for money? No; money is just the medium. Should this trigger contempt for the wealthy? No, but it precludes automatic reverence of the wealthy. Most wealthy people are so because they have indeed contributed positively to the well-being of their fellow, but the presence of dishonestly obtained wealth among them confuses the issue.

What we should be working towards is a world where wealth is always an indication of virtue; where people are justly rewarded for making the world a better place to live in.

3 comments:

Paul Murphy said...

Yes money is an exchange of value. A medium used for exchange. As a virtue is money not also used as expression of your outward desires, For example I look to help people in Haiti while Haitians are providing no valued service in return. Yet the exchange is an expression of my view on hummanity. Which by reason could it also held in evidence as to the true inner pillers that defines who you are, your virtue.

Matthew J Peterson said...

i suppose hatred of money comes from the attribution of dishonesty or callousness to the rich. Regardless where it comes from, the feeling that the rich have an unfair advantage allows the person to give up without shame. if only more of us could realize that virtue is not just for the rich, and that we can become rich through our actions, then we would feel shame with ourselves at not trying harder.

perhaps what's more expensive than a mansion is spending the effort to live virtuously.

but I have to second your point about how the system allows and encourages some dishonest means of making money (GSEs and prisons for drug offenders). but we can't let that stop us.

TJ Murphy said...

With regards to:

"if only more of us could realize that virtue is not just for the rich, and that we can become rich through our actions, then we would feel shame with ourselves at not trying harder."

I think the belief that virtue is rewarded in life is one of the most positive developments in the modern world. I can't speak authoritatively, but I think that as a widespread belief its a relatively recent cultural development. Reference the fatalism of most of the world's old religions and of modern existentialism. I'm also reminded of Hugo's characters: they were incredibly virtuous, but their environment was so twisted that they were crushed rather than rewarded. This cynicism is in contrast to the almost child-like enthusiasm that modern productive people seem to exhibit.

Positive as this optimistic belief is, I think its still pretty fragile. It lacks a codifying support, it lacks a body of cultural understanding that can be used as justification. It lacks even a name, as far as I can tell.

With regards to:
"perhaps what's more expensive than a mansion is spending the effort to live virtuously."

I think a missing fundamental notion here is the understanding of expenditure for investment vs expenditure for consumption. Buying status symbols like mansions is (almost) purely consumptive (and therefore does not increase a person's virtue), whereas expending the effort to live virtuously increases one's capacity for virtue.