Robinson Crusoe's Money

The first thing they did was to abuse poor old Robinson Crusoe, because he had advised his people, in his life-time, to make their money of gold (which can be only produced by labor, and not by hocus-pocus); and their currency of something that represented gold, and this, too, when he must have known that gold “was the machinery and relic of old despotisms;”25 and they made no account whatever of the fact that he was the father of his country and lived in a cave. Next they declared that all the opinions heretofore accepted on this subject by the rest of mankind were fallacious; that nature had done its best to make the island an isolated community; that legislation had pretty effectually supplemented whatever in this respect nature had left deficient; and, therefore, that the wants of the island, in respect to money, currency, and every thing else, were so exceptional and peculiar that the accumulated experience of all the rest of the world could not be to them either applicable or instructive. All agreed that the pernicious theory taught by Robinson Crusoe, Friday, and other men of by-gone days and other countries—that money, to be good, ought to be a universally desirable commodity, and the equivalent of that for which it is exchanged—was the real source of all financial trouble; for was it not clear, that, if such were the case, those only could ever have money who, like the bloated wheat-holders, pig-holders, cattle-holders, house-holders, or bond-holders, had through labor previously come into possession of some desirable things, which they could give in exchange as an equivalent for money? while the true end of all financial reform, and the key to the terrible problem of poverty, was obviously to devise and bring into use that kind of money which those who had no wheat, pigs, cattle, houses, bonds, or other commodities, and were not able or disposed to acquire any through an exchange of their services, could have without difficulty, and in abundance. “We mean, therefore,” said the orator-philosopher, speaking for himself and his colleague Friends of Humanity, “to have more democracy and less aristocracy in the money market; more money in every body’s reach, and less for the petted few.”26 In short, the patient having become very sick and attenuated by reason of the low (fiscal) diet upon which he had been fed, the doctors now proposed to resuscitate him by administering a still thinner gruel.

All also agreed that the word “money” was a bad name, and that the public would obtain a much clearer idea of the great problems at issue if more intelligible and scientific terms embodying definitions were used. One philosopher accordingly proposed that, as they intended to sprout it everywhere, they should go back to the Biblical designation, and call it the “root,” at the same time remarking that “the Lord showed what he thought of money by the kind of people he gave it to.” Another proposed to call it “the instrument of association” (Carey); a third, the “sign of transmission, of which the material shall be of native growth” (John Law, 1705); a fourth, “a sense of value as compared with commodities” (“British Tracts on Money,” 1795–1810); a fifth, “a standard neither gold nor silver, but something set up in the imagination to be regulated by public opinion” (ibid.).

As to what money, under the reform system, was, or should be, was also a question in respect to which there was not at first an entire agreement. One idea which found some favor, was, that money ought to be only a token, representative of services rendered at some indefinite time or place (possibly forgotten or disputed by its recipient), and “for which the holder has not received the equivalent to which he is inherently entitled under the system of division of labor.”27 The best money, therefore, according to the philosophers of this idea, was an evidence that some one person owed some other person; and, consequently, the more debt, the more money; and the more money, the more wealth, unless it is to be supposed (as is not reasonable) that this sort of money was not to have the first attribute of all other money—namely, purchasing power.

Moreover, although the philosophers did not exactly say so, the inference was also legitimate, that in a community using merely “token” or “remembrance” money, the surest way to get rich would be to get in debt, and the best way of carrying on an enlightened system of trade and commerce, to exchange commodities, the results of time and labor, for evidences of debt without interest. It is needless to say that these teachings and inferences tended to greatly strengthen the people on the island in the opinion they before entertained, that the currency they already had—namely, evidences of destruction—was the “best currency the world ever saw.”

The three leaders among the philosophers were not, however, men who were going to be contented with any half-way measures. Had they not put their hands to the plow of reform? and were they, after so doing, to allow the plow to stick fast in the furrow? They accordingly appealed first to authority, and then to untutored reason.

The following are some of the authorities to which great weight was given:

“Commerce and population, which are the riches and power of the state, depend on the quantity and management of money.”—John Law, Memoir to the Duke of Orleans, 1705.

“Does, or does not, our duty to ourselves and the world at large demand that we maintain permanently a non-exportable circulation? Such is the question which now agitates the nation, and must at no distant day absorb all others. The affirmative of this question is also in perfect harmony with the practice and experience of leading nations, and in harmony with the teachings of sound economic science.”—Letter of Henry C. Carey to Congressman Moses W. Field, of Detroit, September, 1875. Consult also Governor William Kieft, “On the Use of Wampum Money in New Amsterdam” (large folio, scarce and rare), 1659.

“Long familiarity with the practice of giving security for loans, and of paying them back at a fixed date, has blinded us to the national advantages of loans without security and payable at any date.”—Karl Marx, Secrétaire, Organisation de l’Internationale.

But the thing which the philosophers relied on more than any thing else to sustain their views before the people was a judicial decision recently made in a neighboring country, by its highest court, before whom the question as to what constituted money was officially brought for determination. This decision, expressed in the very peculiar language of the country, was as follows: “What we do assert is, that Congress has power to enact that the Government promises to pay money shall be, for the time being, equivalent in value to the representative of value determined by the coinage acts, or to multiples thereof.” All of which, translated into the language of the island, meant that Government has the power to make a promise to pay, containing an acknowledgment in itself that the promise has not been paid, a full satisfaction that the promise has been paid. That this decision, furthermore, covered no new points of law, was indirectly conceded by the learned judges, inasmuch as, in giving their opinions, they cited, as precedents worthy of being ever remembered, the decisions of that eminent old-time jurist, Cade (Jack), who ordained that “seven half-penny loaves should be sold for a penny;” and that “the three-hooped pot shall have ten hoops.” The same court also strengthened its position by saying that “it is hardly correct to speak of a standard of value. The Constitution does not speak of it. Value is an ideal thing. The coinage acts fix its unit as a dollar; but the gold and silver thing we call a dollar is in no sense the standard of a dollar. It is a representative of it. There might never have been a piece of money of the denomination of a dollar.”28

[Note.—This last remark of the learned court embodied a great discovery; for how can there be a representative without something to represent? In the case of Peter Schlemihl, there was a man without a shadow; but here we have a shadow without any substance to make it. A gold dollar is not a specific and mechanically formed coin; but 25.8 grains of standard gold is a dollar. Did the court mean that these grains of gold may never have existed, and yet have representatives?—Author.]

The moment this decision was received, all the philosophers got down their dictionaries, and searched for the meaning of the word “ideal.” As was anticipated, its definition was found to be “visionary;” “existing in fancy or imagination only” (Webster); and from this time forth there was no longer any doubt in the minds of the reformers of the truth and strength of the position they occupied. For, to descend to reasoning, were not two intricate questions definitely settled by the highest of human tribunals? 1st. That the representative of a thing may be (and if those in authority say so, shall be) equivalent to the thing itself. 2d. That value is an ideal thing, and therefore imagination, which creates all ideal things, can create value.

It followed, of course, that to have and enjoy any thing and every thing, it is only necessary to create and use its symbol or representative; and to pay for value received, it is only necessary to imagine a corresponding and equivalent value, and pass it over in exchange and settlement. On these conclusions of law and reason, then, it was decided by the three leaders of the philosophers and their friends, who had control of the Government, that the future money of the state should be based. The former inscription on the currency in use, “promise to pay,” they were clear, was entirely unnecessary; for why promise money when the store on hand of money was to be made practically unlimited, or, at least, always equal to the wants of every body who desired to have it, whether he traded or not? Mathematical calculations were also made by a scientist, which proved that the amount of labor which would be actually saved to the community, and made available for other purposes, by using something as money which cost little or no labor to produce, in place of gold or commodities which represented much labor, would be so great as to require the immediate enactment of a law prohibiting any one from working over six hours per day, in order to guard against the evil of too great abundance. The same scientist had previously been so carried away by his demonstrations of the utility of a new stove which saved half the fuel, that he had recommended the purchase of two stoves in order to save the whole.

With few exceptions, to be hereafter noted, the whole population of the island were jubilant, and proceeded as rapidly as circumstances would permit to adjust all their commercial transactions to the new basis. But joy at the prospect of the coming millennium did not extinguish feelings of gratitude in the hearts of the people, and they resolved to send ample testimonials to all, in foreign lands, to whom they had been indebted for wisdom.

To each of the judges who had so intelligently defined value they accordingly voted an ideal castle and estate, possession of the same conferring nobility upon their owner, with the title of “Baron Ideality,” to which, by special patent, the recipient was authorized to use (if he pleased) the prefix of “damn.”

To the most notable advocate, in foreign lands, of the idea of non-exportable money a gift of one million of “instruments of association,” represented by ideal currency, was voted. But as this currency, both by law and the fitness of things, could not be exported from the island, it became impossible to pay this gift, and in its place a letter was written explaining the circumstances, and requesting that the resolution to pay might be accepted as a “sign of transmission.”

To the eminent financier who defined money, “as a sense of value in reference to currency as compared with commodities,” there was sent a plaster image of the “What Is It;” while to his colleague, who had given the opinion that “the less costly the material out of which money was made, the better for the community which uses it,” was sent a large box, containing contributions of the most worthless things every body could think of, with a polite note requesting the recipient to make his choice out of the collection of what seemed to him best adapted as a token, and forward a detailed report of his experience in attempting to use it as a representative of unrequited service.

Pending the slow preparations of the Government of the island to provide the requisite laws for the issue and use of the new money, various enlightened individuals attempted to anticipate official legislative action by putting into practical operation, on their own account, the principles involved in the new fiscal system. The first of these who thus acted was a secretary for the interior part of the island, whose chief business was to supply the heathen—for whom, it will be remembered, Robinson Crusoe took up contributions—with beef. There had been a suspicion for some time past hanging over this official that the heathen did not get all the beef that they were entitled to; but the suspicion probably had no further foundation than the inability of the heathen to make the sense of completion harmonize with the sign of transmission. To satisfy the heathen, and at the same time effectually clear up his character, the official in question now hastened to have prepared a large number of pictures of fine, fat cattle, which he dispatched by a Quaker to the heathen, with a request that they would kill and eat, and be satisfied, adding in a postscript that they would do well to begin to learn economy by saving the skins. As the Quaker never came back, it was deemed reasonably certain that, at least, the first part of the request had been complied with.

The managers of the Island Provident Society also promptly determined to develop and apply the ideal system in their sphere of usefulness to the full extent that circumstances permitted. Thus a large part of the business of this old and respected society was the distribution of clothing to the destitute; and, as is always the case when times are hard, the extent of the demands made upon it for aid tended to exceed the means of supply contributed by the charitable. The managers, however, knew that it never would answer in using the ideal system to subserve the work of charity, to put the locally needy on the same footing as the heathen, and in answer to appeals for raiment distribute to them elaborate pictures of fine clothing, cut from the fashion-plates; for there was this essential difference in the situations, that the needy were at their doors, while the heathen were a great way off. They, therefore, hit upon this happy mean: they employed a competent artist, with a full supply of paints and brushes, and when any destitute person applied for clothing, they painted upon his person every thing he desired in way of clothing of the finest and most fashionable patterns, from top-boots to collars, and from blue swallow-tailed coats to embroidered neck-ties, with jewelry and fancy buttons to match. Of course, the first man who appeared in public thus arrayed created a profound sensation. But the idea was so novel, and had obviously so many advantages over the old way of clothing one’s self, that the supremacy of the ideal over the real was at once greatly strengthened. For example—and here was one of the greatest merits of the new system—it not only symbolized, but practically applied, the views of the most advanced financial philosophers; favored (as the orator-philosopher wished) “more democracy and less aristocracy in the clothes market;” and encouraged the use of the least costly material out of which the community could make clothes; while the painted cotton, silk, wool, and leather could be made to look so exactly like the real articles, that it was only when the attempt was made to exchange the representative for the real that the difference was clearly discernible. Furthermore, every garment devised in accordance with the new system was, in all cases, a perfect fit. The plague of buttons was annihilated. Every man could save time enough in dressing and undressing to enrich himself, if he only employed his economized moments usefully. Every man might, without embarrassment, sleep in his clothes; and if he desired to change his monkey-jacket three hundred and sixty-five times in a year for an overcoat, or an overcoat for a monkey-jacket, he could do it most expeditiously, without the waste of any raw material more expensive than paint; and thus the system, after a time, by a happy thought, got the name of the “three-sixty-five interchangeable.” Of course, this answered very well so long as the weather continued mild and pleasant; but later in the season, when it became cool and frosty, experience soon showed that the warming qualities of different kinds of paint were not essentially different; that something more than confidence was necessary to keep out the cold; and that the temperature and circulation of the body physical remained unaffected, whether a man painted himself sky-blue one day and pea-green the next.29

Again, two shrewd fellows, Peter von Scrapehem and Israel Double, owned each a farm worth ten thousand dollars. Peter sold his farm for its full value to Israel, and took a mortgage for the total purchase-money; and Israel, in turn, sold his to Peter, and took a mortgage also for its full value. By so doing, each of these worthy persons clearly doubled the property in his possession, inasmuch as while each had at the outset only ten thousand dollars’ worth of real estate, each now had ten thousand of real estate and ten thousand of personal property; or an aggregate of forty thousand between them, in the place of twenty thousand originally. This method of multiplying property by multiplying titles was so easy, and the result so apparent, that the example was very generally followed; and when the census came to be taken, a few months afterward, all were amazed at the enormous increase of wealth that had followed the discovery and simple recognition of the true nature and value of titles.

Up to this time the supply of milk on the island had been mainly controlled by a single corporation, which, under the name of the “Lacteal Fluid Association,” owned all the cows, and, for the purpose of facilitating supply, had long been in the habit of issuing tickets, each good for a pint or a quart of milk, and disposing of milk to those only who had tickets. These tickets revolved perfectly in the closed circle of exchange between the milk-men and their customers, satisfying all demands, and being accepted as the same thing as milk; for the more tickets, the more milk; and no tickets, no milk.

During the war the cannibals, in lack of any other meat, had eaten a large number of the cows belonging to the “Lacteal Association.” Many had been also taken by the Government for the soldiers; so that after the war was over there were really no more cows than the island absolutely needed. All at once, the “foot-and-mouth disease” invaded the island, and, attacking every cow belonging to the association, rendered her unable to give milk. Then arose such a piteous cry from every household where there were babies as carried a pang to the stoutest hearts. There was no need of any concerted action, for the people assembled spontaneously and demanded action. An immense public meeting was at once organized. A highly popular and humane man, a special friend of children, familiarly known as Uncle Dick, was called to the chair. He was supported by a long list of leading citizens as vice-presidents and secretaries, none of whom, however, had had any practical acquaintance with milk since their childhood, except in the form of punch. The chairman made an eloquent speech. He did not know whether he was most agitated by pity or indignation—pity for the poor babies, whose sufferings had become intolerable; indignation at the cruelty of the chartered monopolists, who had wantonly refused to issue more tickets at the very time when the demand for milk was most imperative. The assembly was of one mind with the chairman, and unanimously resolved that the Lacteal Association should immediately increase their supply of tickets, and that, in default thereof, their charter should be altered and amended. Unable to resist the storm of popular indignation, the association at once complied, and every patriotic citizen went home to the bosom of his afflicted family, carrying an abundant supply of milk-tickets, and feeling conscious that for once at least he had risen to the level of the occasion.

That night the babies were all supplied with milk-tickets in the place of milk. Milk-tickets hot, milk-tickets cold, milk-tickets sweetened, milk-tickets plain, milk-tickets with their backs printed green, and interchangeable with milk-tickets drawing cream skimmed from other milk-tickets. But, strange to say, the babies, one and all, with that same sort of instinctive perversity which induces children of a larger growth to refuse to accept shams for reality, and be grateful in addition, refused to take to milk-tickets. The uproar of the night preceding was as nothing to the disturbances of the night following, and morning dawned upon an unrefreshed and troubled population.

As soon as the necessary arrangements could be made, another meeting assembled. But the meeting this time was composed of babies, backed by their mammas and nurses. There was no theory in their sentiments; and though young in years, one and all felt that they had lived long enough to know what their fathers apparently did not know—namely, the difference between milk and paper. The resolutions voted were brief, but to the point, and were, substantially, as follows:

First, that the exigencies of the times demanded more milk, and not more milk-tickets; second, that the way to get more milk was to have more cows; third, that the way to get more cows was to go to work and raise them, or raise something else equally valuable, and then with this something else buy cows; fourth, that there are certain eternal verities against which it is useless for either babies or men to contend. A committee was appointed to procure a mill of the gods, to grind up those who disbelieved in the last resolution, and the meeting then adjourned.

This was the first indication of any thing like popular dissent from the views of the Friends of Humanity. Others, however, soon followed. Value having been declared to be an ideal thing, and ideal measures of value having been substituted in the place of the real and tangible measures formerly in use, it had been deemed proper to substitute ideal measures of length, weight, and capacity in the place of the foot-rules, yard-sticks, pound-weights, and bushel-measures formerly employed. Shop-keepers, plumbers, charcoal-men, gas corporators, and all others who had any thing to sell accordingly provided themselves with slips of paper, upon which were printed, respectively, “This is a foot,” “This is a bushel,” “This is a pint,” “This is a pound;” and the services of the arithmetic-man were again called for, to prove how much more cloth, beer, charcoal, gas, and all other measurable things the community would certainly have by the saving of labor and capital contingent on the avoidance of the necessity of further manufacturing, purchasing, and using the old measures.

But the new system did not work smoothly. There was no harmony of sentiment between buyers and sellers; and what was one man’s ideal of what he should give or receive in trade was always different from every other man’s; and, before the community were well aware of what they were about, they found themselves drifting back to the adoption of the old system of barter, which had been tried and abandoned in the early days of the island’s history. Instead of one price, every one who had commodities or services to sell adopted a scale of at least four prices: “pay price,” “money price,” “pay as money price,” and a “trusting price;” and the seller, before fixing his price, invariably asked his customer how he would pay.30 “Pay price” was barter; “money price” was payment in foreign coin; “pay as money” was in the ideal money of the island; “trusting” was an enhanced price, according to time. Thus, supposing a customer wanted a knife, its price in “pay” would be a bushel of corn; in “money price,” a fifty-cent gold or silver coin; in “pay as money,” sometimes as much as he could bring in a basket, at other times as much as he could bring in a wheelbarrow; and before the ultimate abandonment of the use of ideal money, a cart had to be employed to bring the money. Trade in this way became “most intricate.”