It is time, therefore, to enter into a new story, and a new kind of money that embodies it. 

Reprinted from REALITY SANDWICH

This article is fourth in a series, and draws on background covered in "Money: A New Beginning," Part 1 and 2, and "Money and the Crisis of Civilization."

As the economic meltdown proceeds to its next phase, we begin to seethe unreality of much that we thought real. The verities of twogenerations become uncertain, and despite a lingering hope that areturn to normalcy is just around the corner -- in "the third quarterof 2009" or "by the middle of 2010" -- the realization is dawning thatnormal isn't coming back.

When faced with an abrupt shift in personal reality, whether the deathof a loved one, or the Gestapo coming into town, human beings usuallyreact first with denial. My first response when tragedy hits isusually, "I can't believe this is happening!" I was not surprised,then, that our nation's political and corporate leaders spent a longtime denying that a crisis was underway. Consider some quotes from2007: "The country's economic fundamentals are sound," said George W.Bush. "I don't see subprime mortgage market troubles imposing a seriousproblem. I think it's going to be largely contained," said TreasurySecretary Paulson. "A recession is unlikely." "We are experiencing acorrection in the housing sector." "America is not in recession." "Itis likely that housing prices won't recover until early 2009."

Of course, many of these pronouncements were insincere, efforts atperception management. The authorities hoped that by controlling thepublic perception of reality, they could control reality itself; thatby the manipulation of symbols they could manipulate the reality theyrepresent. This, in essence, is what anthropologists call"magico-religious thinking." It is not without reason that ourfinancial elites have been called a priesthood. Donning ceremonialgarb, speaking an arcane language, wielding mysterious inscriptions,they can with a mere word, or a mere stroke of a pen, cause fortunesand nations to rise and fall.

You see, magico-religious thinking normally works. Whether it is ashamanic rite, the signing of an appropriations bill, or the posting ofan account balance, when a ritual is embedded in a story that peoplebelieve, they act accordingly, playing out the roles the story assignsto them, and responding to the reality the story establishes. In formertimes, when a shamanic rite was seen to have failed, everyone knew thiswas a momentous event, signaling the End of the World, a shift in whatwas real and what was not, the end of the old Story of the People andthe beginning, perhaps, of a new one. What, from this perspective, isthe significance of the accelerating failure of the rites of finance?

We like to scoff at primitive cave-dwellers who imagined that theirrepresentations of animals on cave walls could magically affect thehunt. Yet today we produce our own talismans, our own systems of magicsymbology, and indeed affect physical reality through them. A fewnumbers change here and there, and thousands of workers erect askyscraper. Some other numbers change, and a venerable business shutsits doors. The foreign debt of a Third-World country, again merenumbers in a computer, consigns its people to endless enslavementproducing commodity goods that are shipped abroad. College students,ridden with anxiety, deny their dreams and hurry into the workforce topay off their student loans, their very will subject to a piece ofpaper with magical symbols ("Account Statement") sent to them onceevery moon, like some magical chit in a voodoo cult. These slips ofpaper that we call money, these electronic blips, bear a potent magicindeed!

How does magic work? Rituals and talismans affirm and perpetuate theconsensus stories we all participate in, stories which form ourreality, coordinate our labor, and organize our lives. Only inexceptional times do they stop working: the times of a breakdown in thestory of the people. We are entering such times today. That is why noneof the economic measures enacted so far to contain the crisis haveworked, and why the current stimulus package won't work either. None godeep enough. The only reform that can possibly be effective will be onethat embodies, affirms, and perpetuates a new story of the people (ifwe can agree on one). To see what that might be, let us dig downthrough the layers of failing realities and their relationship tomoney.

When the government's first response to the crisis -- denial -- provedfutile, the Federal Reserve and Treasury Department tried another sortof perception management. Deploying their arsenal of mysticalincantations, they signaled that the government would not allow majorfinancial institutions such as Fannie Mae to fail. They hoped thattheir assurances would be enough to maintain confidence in the assetsthat depended on these firms' continued solvency and prosperity. Itwould have worked if the story these symbolic measures invoked was notalready broken. But it was. Specifically, what was broken was the storyassigning value to mortgage-backed securities and other derivativesbased on unrepayable loans. Unlike camels or bushels of grain, but likeall modern currencies, these have value only because people believethey have value. Moreover, this is not an isolated belief, but isinextricably linked with millions of other beliefs, conventions,habits, agreements, and rituals.

The next step was to begin injecting massive amounts of cash intofailing financial institutions, either in exchange for equity(effectively nationalizing them, as in the case of Fannie Mae, FreddieMac, and AIG), or in exchange for essentially nothing whatsoever, as inthe TARP program. In the latter, the Treasury Department (using yourtax dollars) guaranteed or bought banks' toxic assets in hopes ofimproving their balance sheets so that they would start lending again,thus keeping the credit bubble expanding. It didn't work. The banksjust kept the money (except what they paid to their own executives asbonuses) as a hedge against their exposure to untold quantities ofadditional bad assets, or they used it to acquire smaller, healthierbanks. They weren't about to lend more to consumers who were alreadymaxed out, nor to over-leveraged businesses in the teeth of arecession. Property values continued to fall, credit default ratescontinued to rise, and the whole edifice of derivative assets builtupon them continued to crumble. Consumption and business activityplummeted, unemployment skyrocketed, and people in Europe began riotingin the streets. And why? Just because some numbers changed in somecomputers. It is truly amazing. It only makes sense when you see thesenumbers as talismans embodying agreements. A supplier digs minerals outof the ground and sends them to a factory, in exchange for what? For afew slips of paper, or more likely, in exchange for some bits movingaround in a computer, which can only happen with the permission of abank (that "provides credit").

Before we become too alarmed about the impending giveaway of $8trillion dollars on top of the $2 trillion we have already given to thewealthy, let us touch back again upon the reality of money. Whatactually happens when this money is given away? Almost nothing happens.What happens is that bits change in computers, and the few people whounderstand the interpretations of those bits declare that money hasbeen transferred. Those bits are the symbolic representation of anagreement about a story. This story includes who is rich and who ispoor, who owns and who owes. It is said that our children andgrandchildren will be paying these bailout and stimulus debts, but theycould also simply be declared into non-existence. They are only as realas the story we agree on that contains them. Our grandchildren will paythem only if the story, the system of meanings, that defines thosedebts still exists. But I think more and more people sense that thefederal debt, the U.S. foreign debt, and a lot of our private mortgageand credit card debts will never be repaid.

We think that those Wall Street tycoons absconded with billions, butwhat are these billions? They too are numbers in computers, and couldtheoretically be erased by fiat. The same with the money we owe China.It could be gone with a simple declaration. We can thus understand themassive giveaways of money in the TARP, TALF, and PPIF programs as yetanother exercise in perception management, though this time it is anunconscious exercise. These giveaways are ritual acts that attempt toperpetuate a story, a matrix of agreements, and the human activitiesthat surround it. They are an attempt to uphold the magical power ofthe voodoo chits that keep the college grad on a career path and themiddle-aged man enslaved to his mortgage; that give the power to a fewto move literal mountains, while keeping the many in chains.

Speaking of China, I find it instructive to look at the physicalreality underlying the trade deficit. Basically what is happening isthat China is shipping us vast quantities of stuff -- clothes, toys,electronics, nearly everything in Wal-Mart -- and in return werearrange some bits in some computers. Meanwhile, Chinese laborers workjust as hard as we do, yet their day's wages buy much less. In the olddays of explicit empires, China would have been called a "vassal state"and the stuff it sends us would have been called "tribute." Yet Chinatoo will do everything it can to sustain the present Story of Money,for essentially the same reason we do: its elites benefit from it. Itis just as in Ancient Rome. The elites of the imperial capital and theprovinces prosper at the expense of the misery of the people, whichincreases over time. To keep it in check, in the capital at least, themasses are kept docile and stupid with bread and circuses: cheap food,cheap thrills, celebrity news, and the Superbowl.

Whether we declare it to end, or whether it ends of its own accord, thestory of money will bring down a lot with it. That is why the UnitedStates won't simply default on its debt. If it did, then the storyunder which the Middle East ships us its oil, Japan its electronics,India its textiles, and China its plastic would come to an end.Unfortunately, or rather fortunately, that story cannot be savedforever. The reasons are complex, so I'll just point you in the rightdirection if you want to research it yourself. Essentially, at somepoint China (and other creditor nations) will have to appreciate itscurrency, replace exports with domestic demand, and raise interestrates in order to combat disastrous inflation caused by its pumpingyuan into its economy in exchange for all the dollars flowing in fromits exporters. The result will be a run on the dollar, a globalcalamity that will put an end to money as we have known it. When thathappens, our government will have only two choices: extreme austeritymeasures such as those we have long perpetrated on other countriesthrough the IMF, or a bout of currency-destroying hyperinflation. Thelatter is probably inevitable; austerity would only stave it offtemporarily. That would be the end of our current story of money, forit would render all financial wealth (and debt) worthless.

When money evaporates as it is doing in the current cycle of debtdeflation, little changes right away in the physical world. Stacks ofcurrency do not go up in flames (but even if they did, that is not toomomentous a physical event). Factories do not blow up, engines do notgrind to a halt, oil wells do not dry up, people's economic skills donot disappear. All of the materials and skills that are exchanged inhuman economy, upon which we rely for food, shelter, transportation,entertainment, and so on, still exist as before. What has disappearedis our capacity to coordinate our activities and focus our commonefforts. We can still envision a new airport, but we can no longerbuild it. The magic talisman by which the pronouncement, "An airportshall be built here" crystallizes into material reality has lost itspower. Human hands, minds, and machinery retain all their capacities,yet we can no longer do what we once could do. The only thing that haschanged is our perceptions.

Clearly, the TARP program and other bailouts are also an exercise inperception management, but on a deeper, less conscious level. Becausewhat is money, anyway? Money is merely a social agreement, a story thatassigns meaning and roles. The classical definition of money -- amedium of exchange, a store of value, a unit of account -- describewhat money does, but not what it is.Physically, it is now next to nothing: slips of paper, bits incomputers. Socially, it is next to everything: the primary agent forthe coordination of human activity and the focusing of collective humanintention.

The government's deployment of trillions of dollars in money is thuslittle different from its earlier deployment of empty words. Both arenothing but the manipulation of various types of symbols, and both havefailed for an identical reason as well: the story they are trying toperpetuate has run its course. The normalcy we took as normalcy wasunsustainable. It is unsustainable on two levels. The first level isthe debt pyramid, the exponential growth of money that inevitablyoutstrips the real economy.

The first level of unsustainable normalcy is based on what MichaelHudson calls "the miracle of compound interest." Interest rates alwaystend to exceed the rate of real economic growth, which in the absence of defaultsmeans that money grows faster than the volume of goods and services itbuys, and that debt grows faster than gross domestic product (GDP).This has indeed been the case in the last 60 years in the UnitedStates, as private debt has risen from about 50% to about 350% of GDP.This cannot go on forever: to take an extreme example, a dollarinvested at only 3% interest in the year 1 A.D. would be worth about$100,000,000,000,000,000,000,000,000 today. Such sustained exponentialgrowth is obviously impossible, so what happens? What must happen isthat from time to time, some of this money must disappear through oneof two ways: defaults, or inflation. Both of these results areultimately good for debtors and bad for creditors; they transfer wealthto those who owe from those who own. Inflation means that the realvalue of loans shrinks over time: loans are repaid with cheaperdollars. Defaults mean that some creditors don't get paid back at all,and have to take a loss.

U.S. fiscal policy for the last two generations has attempted toprevent both, but the narrow road between them is shrinking to nothing.If income from production of goods and services is insufficient toservice debt, then the creditors begin to seize assets instead. This iswhat has happened both in the American economy and globally. Mortgages,for example, were originally a path toward owning your own home freeand clear, starting with 20% equity. Today few ever dream of actuallyone day repaying their mortgage, but only of endlessly refinancing it,in effect renting the house from the bank. Globally, Third Worldcountries find themselves in a similar situation, as they are forced tosell off national assets and gut social services under IMF austerityprograms. Just as you might feel your entire productive labor is in theservice of debt repayment, so is their entire economy directed towardproducing commodity goods to repay foreign debt.

Eventually, debtors run out of seizable assets. The crash underwaytoday should have actually happened many years ago, except that variousphony and inflated assets were created to keep it going a little longeras the financial industry cannibalized itself, covering debt with moredebt. The efforts to shore up this edifice cannot work, because it mustkeep growing -- all those debts bear interest. Yet the authorities keeptrying. When you hear the words "rescue the financial system,"translate it in your mind into "keep the debts on the books." They aretrying to find a way for you (and debtor nations too) to keep payingand for the debt to keep growing. A debt pyramid cannot grow forever,because eventually, after all the debtors' assets are gone, and alltheir disposable income has been devoted to debt payments, creditorshave no choice but to lend debtors the money to make their payments.Soon the outstanding balance is so high that they have to borrow moneyeven to pay interest, which means that money is no longer flowing, and canno longer flow, from debtor to creditor. This is the final stage,usually short, though prolonged in our day by Wall Street's financial"wizardry." The loans and any derivatives built on them begin to losetheir value, and debt deflation ensues.

I have just described the leadup to a deflationary depression. As itdawns on our leaders that we are not experiencing a mere"retrenchment," "correction," or "recession," but are at the brink of afull-fledged deflationary depression, they are now beginning to actaccordingly. When debts become unpayable, one can either reduce oreliminate the debt entirely, or one can try to increase the income ofthe debtor so that he can continue to make payments. The holders ofwealth, whose interests determine government policy, would obviouslyprefer the latter, since a reduction in your debt is a reduction intheir wealth. Consequently, the first response of the Obamaadministration to the deflationary crisis is economic stimulus. It willbe more reluctant to adopt the second option, although we are beginningto hear calls for bank nationalizations, debt writedowns, and debtforgiveness now as well.

Both responses have as their ultimate goal the reigniting of economicgrowth, something nearly everyone agrees on. Here we enter into asecond, deeper, story of money. I believe that even the most radicalmeasures proposed today can have at best only a temporary effect: ifthey instigate economic growth it will be anemic and short-lived. Thatis because economic growth as we define it today, and money as wedefine it today, is part of a Story of the People that too is becomingobsolete. Reflecting this obsolescence, the true nature of the crisiswill become apparent as each progressively more radical solution failsto restore the status quo. What we are facing today is not merely aMinskian bubble collapse, nor merely, even a deflationary unwinding ofcredit: it is nothing less than a Marxian "historical crisis ofcapital," resurging now at a time when all the measures that have keptit at bay for two centuries have finally been exhausted.

The Marxian crisis is deeply related to the depletion of social,cultural, natural, and spiritual capital I describe in previous essaysof this series. I will now describe this relationship, and then recastthe Revolution in terms of a metamorphosis of the Story of the People.

First, a simplified description of a Marxian crisis. Consider anindustry, say automobiles, comprising a number of competing firms. Ascompetition forces profit margins lower and lower, each firm strives tocut costs and improve efficiency to avoid going out of business. Theydo this by reducing labor costs, adopting new technology, andincreasing manufacturing capacity to take advantage of economies ofscale. Several vicious circles begin. For one, increased capacitydrives prices and profit margins per unit still lower, forcing eachfirm to expand capacity still more to compete. The policies thatbenefit each firm harm the industry as a whole: the response toindustry-wide overcapacity is to build yet more capacity. Second,reducing labor costs through wage cuts, layoffs, and labor-savingtechnology reduces the purchasing power of workers, leading to weakerdemand, lower profits, and the need to reduce labor costs stillfurther. Weaker firms go out of business, capital is concentrated intofewer and fewer hands, and unemployment rises, leading to socialbreakdown and revolution.

More generally, once the fulfillment of essential human needs isremoved from its organic matrix of nature and community and taken overby machine processes, it becomes subject to economies of scale andtechnological improvements in efficiency, allowing these needs to bemet with decreasing human effort. Marx, believing that profit comesfrom the expropriation of the added value of labor, concluded thatprofits will inevitably fall in any mature industry. In other words,marginal return on capital falls, price competition increases, profitsdrop and wages drop along with them. Needs can be met with less effortthan ever before, yet because of the polarization of wealth, fewer andfewer of them actually are met. A minority is awash in cheap junk itbarely needs, while the majority lacks for the basic necessities itonce enjoyed, without exchange of money, a generation or two before.

What is this overproduction that is so central to the crisis ofcapital? It means production in excess of human needs. Therefore, oneway to delay -- perhaps forever -- the Marxian crisis is to find newneeds to meet. Technology is the agent of this process: for example,the telephone met a need for long-distance communication, opening a newindustry -- telecommunications -- for rapid growth and high profits.The ideology I call the Technological Program says that there is nolimit to technology's ability to discover and meet new human needs.Economists cite this as the primary flaw in Marx's reasoning: he didn'taccount for our technological ability to innovate, to constantly createnew high-profit industries to supplant mature ones. This is an ideologyof endless growth, an economy of onward and upward. It scoffs at anynaysayer who would question the infinite human capacity to create andinnovate. It says there are no limits to growth: certainly not energy-- we will invent new energy technologies and reduce demand throughminiaturization and efficiency. Certainly not food supply -- we willincrease it through biotechnology while limiting human populationgrowth and/or colonizing new planets and eventually engineering wholenew ecosystems. Marx was only right if human inventiveness is finite.

According to this understanding, the restless anxiety and competitioninherent in our money system is a good thing, impelling us to fulfillour destiny as lords and masters of the universe. As I have explainedin earlier essays, money as we know it today has a built-in imperativeto grow endlessly. Its growth carries the underlying real economy alongwith it, motivating the endless creation of new goods and services, andtherefore (our ideology concludes) the endless creation of new andundreamed of forms of wealth. From within that ideology, the presenteconomic crisis is seen as merely a financial crisis, caused by theexpansion of credit outstripping the expansion of the real economy. Atworst, after a wave of bankruptcies and defaults, the excess money willhave cleared away, and growth can begin anew. The possibility anddesirability of renewed growth is seldom questioned, except bycommitted environmentalists.

I would like to point out a fatal flaw in this logic, one that does notdeny the infinite creativity of the human spirit. I find mostlimits-of-growth arguments dispiriting, as they imply an arrest of ourunique human gifts, culture and technology. But there is a flaw in thecritique of the inevitable Marxian crisis that does not depend ondenying our gifts. You see, generally speaking, technology does notactually meet new needs; it merely changes the way in which existingneeds are met.

Consider telecommunications. Human beings do not have an abstract needfor long-distance communication. We have a need to stay in contact withpeople with whom we share emotional and economic ties. In past times,these people were usually close by. A hunter-gatherer or 14th centuryRussian peasant would have had little use for a telephone. Telephonesbegan to meet a need only when other developments in technology andculture spread human beings farther apart, splintering extendedfamilies and local communities. So the basic need they meet is notsomething new under the sun.

Consider another technological offering, one to which my children, tomy great consternation, seem irresistibly attracted: massivelymulti-player online fantasy role playing games. The need these meet isnot anything new under the sun either. Pre-teens and teenagers have astrong need to go exploring, to have adventures, and to establish anidentity via interactions with peers that reference this explorationand adventure. In past times, this happened in the actual outdoors.When I was a child we had nothing like the freedom of generationsbefore us, as you might read about in Tom Sawyer,yet still my friends and I would sometimes wander for miles, to a creekor an unused quarry pit, an undeveloped hilltop, the train tracks.Today, one rarely finds groups of kids roaming around, when every bitof land is fenced and marked with No Trespassing signs, and whensociety is obsessed with safety, and when children are so overscheduledand driven to perform. Technology and culture have robbed children ofsomething they deeply need, and then, in the form of video games, soldit back to them.

I remember the day I realized what was happening. I happened to watchan episode of the Pokemon television show, which is basically aboutthree kids roaming around having magical adventures. These on-screen,fictitious, trademarked characters were having the magical adventuresthat real children once had, but now must pay for the privilege ofwatching. As a result, GDP has grown. New "goods and services" (bydefinition, things that are part of the money economy) have beencreated, replacing functions that were once fulfilled for free.

A little reflection reveals that nearly every good and serviceavailable today meets needs that were once met for free. What aboutmedical technology? Compare our own poor health with the marvelous health enjoyed by hunter-gatherers and primitive agriculturalists,and it is clear that we are purchasing, at great expense, our abilityto physically function. Child care? Food processing? Transportation?The textile industry? Space does not permit me to analyze each of thesefor what necessities have been stolen and sold back to us. I will offerone more piece of evidence for my view: if the growth of money reallywere driving the technological and cultural meeting of new needs, thenwouldn't we be more fulfilled than any humans before us? As HenryMiller wrote in The World of Sex,

We devise astounding means of communication, but do we communicate withone another? We move our bodies to and fro at incredible speeds, but dowe really leave the spot we started from? Mentally, morally,spiritually, we are fettered. What have we achieved in mowing downmountain ranges, harnessing the energy of mighty rivers, or movingwhole populations about like chess pieces, if we ourselves remain thesame restless, miserable, frustrated creatures we were before? To callsuch activity progress is utter delusion. We may succeed in alteringthe face of the earth until it is unrecognizable even to the Creator,but if we are unaffected wherein lies the meaning?

Despite what the GDP statistics say, what has happened is not thecreation of new wealth at all. What has happened is the conversion ofexisting wealth into money. We have converted nature into commoditiesand relationships into services. From time to time throughout modernhistory, our ability to do this has reached a temporary impasse.Whenever that happens, a Marxian crisis of capital looms: fallingreturns on capital investment (falling profit margins), falling realwages, transfer of investment into financial speculation, risingindebtedness, and so on in a self-reinforcing circle of misery that canonly end in systemic collapse. So far, the powers that be havesuccessfully postponed the crisis each time. There are several ways todo so, but each is a temporary solution unless it can escalateindefinitely. One is colonization: to find distant people who stillmeet their own needs without money, stripmine their natural resourcesand social capital from them, and sell enough back to them to keep themalive. This strategy manifests as low wages and commodity exports.Another strategy is war, which consumes vast amounts of production anddestroys productive capacity and infrastructure so that it may berebuilt again. That was how WWII ended the Great Depression, and thatis why so many companies lined up hungrily behind the United Statesarmed forces hoping to get a piece of the reconstruction contracts forIraq. However, war too is becoming obsolete as a solution to the crisisof capital. For one thing, productive capacity rises faster than themilitary industry's ability to absorb it. Secondly, with the advent ofnuclear weapons, total war is no longer an option.

To maintain the exponential growth of money, then either the volume ofgoods and services must be able to keep pace with it, or imperialismand war must be able to escalate indefinitely. All three have reachedtheir limit. There is nowhere to turn.

The credit bubble that is blamed as the source of our current economicwoes was not a cause of them at all, but only a symptom. When returnson capital investment began falling in the early 1970s, capital began adesperate search for other ways to maintain its expansion. When eachbubble popped -- commodities in the late 1970s, S&L real estateinvestments in the 1980s, the dotcom stocks in the 1990s, and realestate and financial derivatives in the 2000s -- capital immediatelymoved on to the next bubble, maintaining an illusion of economicexpansion. But the real economy was stagnating. There were not enoughneeds to meet the overcapacity of production, not enough social andnatural capital left to convert into money.

Today, the impasse in our ability to convert nature into commoditiesand relationships into services is not temporary. There is little morewe can convert. Technological progress and refinements to industrialmethods will not help us take more fish from the seas -- the fish aremostly gone. It will not help us increase the timber harvest -- theforests are already stressed to capacity. It will not allow us to pumpmore oil -- the reserves are drying up. We cannot expand the servicesector -- there are hardly any things we do for each other that wedon't pay for already. There is no more room for economic growth as wehave known it; that is, no more room for the conversion of life and theworld into money. Therefore, even if we follow the more radical policyprescriptions from the left, hoping by an annulment of debts and aredistribution of income to ignite renewed economic growth, we can onlysucceed in depleting what remains of our divine bequeathment of nature,culture, and community. At best, Obama's policies as they stand todaywill allow a modest, shortlived expansion as the functions that weredemonetized during the depression are remonetized. For example, becauseof the economic situation, some friends and I cover for each other'schild care needs, whereas in prosperous times we sent our kids topreschool. Our reciprocity represents an opportunity for economicgrowth: what we do for each other freely can be converted intomonetized services. Generalized to the whole society, this is only anopportunity to grow back to where we were before, at which point thesame crisis will emerge again. "Shrink in order to grow," the essenceof war and deflation, is only effective, and decreasingly so, as aholding action while new realms of unmonetized social and naturalcapital are accessed.

The story that is ending in our time, then, goes much deeper than thestory of money. I call this story The Ascent of Humanity. It is a storyof endless growth, and the money system we have today is an embodimentof that story, enabling and propelling the conversion of the naturalrealm into the human realm. It began millennia ago, when humans firsttamed fire and made tools; it accelerated when we applied these toolsto the domestication of animals and plants, and began to conquer thewild, to make the world ours. It reached its glorious zenith in the ageof the Machine, when we created a wholly artificial world, harnessingall the forces of nature and imagining ourselves to be its lords andpossessors. And now, that story is drawing to a close, as theinexorable realization dawns that the story is not true. Despite ourpretenses, the world is not really ours; despite our illusions, we arenot in control of it. As the unintended consequences of technologyproliferate, as our our communities, our health, and the ecologicalbasis of civilization deteriorate, as we explore new depths of misery,violence, and alienation, we enter the final stages of a story nearingcompletion: crisis, climax, and denouement. The rituals of ourstorytellers are to no avail. No story can persist beyond its ending.

It is time, therefore, to enter into a new story, and a new kind ofmoney that embodies it. Just as life does not end with adolescence,neither does civilization's evolution stop with the end of growth. Weare in the midst of a transition parallel to an adolescent's transitioninto adulthood. Physical growth ceases, and ones vital resources turninward to foster growth in other realms. In childhood, it is right fora person to do what is necessary to grow, both physically and mentally.A good mother provides the resources for this growth, as our MotherEarth has done for us. We began in the womb of hunter-gathererexistence, in which we made no distinction between human and nature,but were enwombed within it. An infant does not have a strongself-other distinction, but takes time to form an identity and an ego,and to learn that the world is not an extension of the self. So it hasbeen for humanity collectively. Whereas the hunter-gatherer had noconcept of a separate "nature" distinct from "human", theagriculturist, whose livelihood depending on the objectification andmanipulation of nature, came to think of nature as a separate category.In the childhood of agricultural civilization, humanity developed aseparate identity and grew large. We had our adolescent growth spurtwith industry, and on the mental plane entered through Cartesianscience the extreme of separation, the fully developed ego andhyperrationality of the teenager who, like humanity in the Age ofScience, completes the stage of cognitive development known as "formaloperations", consisting of the manipulation of abstractions. But as theextreme of yang contains the birth of yin, so does the extreme ofseparation contain the seed of what comes next: reunion. Because inadolescence, you fall in love, and your world of perfect reason andperfect selfishness falls apart as the self expands to include thebeloved within its bounds. Fully individuated from the Other, you canfall in love with it, and experience a reunion greater than theoriginal union, for it contains within it the entire journey ofseparation. The environmental movement and numerous spiritual movementsare all evidence that we are falling in love again with planet earth.

From this perspective, it is obvious that a money system that compelscontinued physical growth, that compels taking more and more from theearth, is obsolete. It is incompatible with love, with reunion. That iswhy no financial or economic reform can possibly work that does notinclude a new kind of money. The new money must embody a new story, onethat treats nature not as a mother but as a lover. We will still have aneed for money for a long time to come, because we need magical symbolsto reify our Story of the People, to apply it to the physical world asa creative template. The essential character of money will not change:it will consist of magical talismans, whether physical or electronic,through which we assign roles, focus intention, and coordinate humanactivity.

I have described the currency of Reunion in previous essays in this series, as well as in The Ascent of Humanity.I want to emphasize that there is a personal, some might say spiritual,dimension to the metamorphosis of stories that we are entering. Today'susury-money is part of a story of separation, in which "more for me isless for you." That is the essence of interest: I will only "share"money with you if I end up with even more of it in return. On thesystemic level as well, interest on money creates competition, anxiety,and the polarization of wealth. Meanwhile, the phrase "more for me isless for you" is also the motto of the ego, and a truism given thediscrete and separate self of modern economics, biology, andphilosophy. Only when our sense-of-self expands to include others,through the process called love, is that truism replaced by itsopposite: "More for you is also more for me." This is the essentialtruth embodied in the world's authentic spiritual teachings, fromJesus's Golden Rule, which has been misconstrued and should read: "Asyou do unto others, so also do you to unto yourself", to the Buddhistdoctrine of karma. However, to merely understand and agree with theseteachings is not enough; many of us walk around with a divide betweenwhat we believe and what we live. An actual transformation in the waywe experience being is necessary, and such a transformationusually comes about in much the same way as our collectivetransformation is happening now: through a collapse of the old story ofself and world, and the birth of a new one. For the self, too, isultimately a story, with a beginning and an end. Have you ever gonethrough an experience that leaves you, afterward, hardly knowing whoyou are?

The transition from the small, rational, ego self to a larger, moreconnected one normally happens in late adolescence and, according toJoseph Chilton Pearce, corresponds to developments in the mysterious"fourth brain": the prefrontal cortex, whose functions are largelyunknown. Ancient tribal cultures had various coming-of-age ceremoniesand ordeals that purposely shattered the smaller identity throughisolation, pain, fasting, psychedelic plants, or other means, and thenrebuilt and reincorporated it into a larger, transpersonal identity.Though we intuitively seek them out in the form of drinking, drugs,fraternity and military hazing, and so on, modern men and women usuallyhave only a partial experience of this process, leaving us in a kind ofperpetual adolescence. It ends only when fate intervenes to tear ourworld apart. Then we can enter a wider self, in which giving comes justas naturally as taking. Naturally, you give according to your abilitiesand, linked with others of like spirit, you receive according to yourneeds.

Not coincidentally, I have just paraphrased a fundamental tenet ofsocialism: "From each according to his abilities, to each according tohis needs." This is a good description of any gift network, whether ahuman body, an ecosystem, or a tribal gift culture. As previous essaysdescribe, it is also a good description of an economy based ondemurrage currency -- money that, like all things of nature, decayswith time. Demurrage currency contributes to a very different story ofthe people, of the self, and of the world than usury-money. It iscyclical rather than exponential, always returning to its source; itredefines wealth as a function of one's generosity and not one'saccumulation; it is the manifestation of abundance not scarcity. It hasthe potential to recreate the gift dynamics of primitive societies on aglobal scale, bringing forth human gifts and directing them towardhuman needs. It nullifies the discounting of future cash flows thatenables us to destroy the future for the sake of the present: underdemurrage, the best business decision is the best ecological decisionand the best social decision. It is thus a currency of sustainability.Because it is not compelled to grow over time, neither does it dragmore and more of the world into the realm of commodities and services.

I remember as a teenager reading Ayn Rand's Atlas Shrugged,whose black-and-white characters, hyperrationality, and moralabsolutism appealed strongly to my adolescent mind. The book is amanifesto of the discrete and separate self, the mercenary ego, and itappeals to adolescent minds to this day. Alan Greenspan is a great fan,though perhaps he too is going through a transformation as the worldfalls apart. In any event, the book devoted its most vitriolic ridiculeto the phrase "From each according to his abilities, to each accordingto his needs," painting a picture of people outdoing each other intheir self-portrayals of neediness so that they could be allotted agreater share of resources, while producers had no motivation toproduce. This scenario, which was in certain respects played out in thecommunist block, echoes a primal fear of the scarcity-conditionedmodern self -- what if I give, and receive nothing in return? Thisdesire of an assurance of return, a compensation for the risk ofgenerosity, is the fundamental mindset of interest and, as I havedescribed, an adolescent mindset to be superseded by a more expansiveadult self that has matured into full membership in the community ofbeing. But don't just take my word for it. A little reflection revealsthat no one can be fulfilled without the opportunity to give fully ofher gifts. What makes a job unfulfilling? No matter how highly paid, ifyou lack the opportunity to fully apply your gifts toward a purposethat inspires you, any job eventually becomes soul-destroying. We arehere to express our gifts; it is among our deepest desires and wecannot be fully alive otherwise.

The Marxian crisis of capital offers another perspective on theexpression of human gifts. Most needs have been monetized, while theamount of labor needed to meet those monetized needs is falling.Therefore, in order for human gifts to receive their full expression,all this excess human creativity must therefore turn elsewhere, towardneeds or purposes that are inimical to the money of Separation. Forindeed, the regime of money has destroyed, and continues to destroy,much that is beautiful -- indeed, every public good that cannot be madeprivate. Here are a few examples: a starry night sky free of lightpollution; a countryside free of road noise; a vibrant multi-culturallocal urban economy; unpolluted lakes, rivers, and seas; the ecologicalbasis of human civilization. Many of us have gifts that wouldcontribute to all of these things, yet no one will pay us to give them.That's because money as we know it ultimately rests on converting thepublic into the private. The new money will encourage the opposite, andthe conflict between our ideals and practical financial reality willend. The era of taking will be over. The era of the Gift will begin.

Usury-money is the money of growth, and it was perfect for humanity'sgrowth stage on earth, and for the story of ascent, of dominance andmastery. The next stage is one of cocreative partnership with earth.The Story of the People for this new stage is coming together rightnow. Its weavers are the visionaries of fields like permaculture,holistic medicine, renewable energy, mycoremediation, local currencies,restorative justice, attachment parenting, and a million more. To undothe damage that the Age of Usury has wrought on nature, culture,health, and spirit will require all the gifts that make us human, andindeed is so impossibly demanding that it will take those gifts to anew level of development.

Just as usury-money has mobilized humanity's gifts for the purposes ofgrowth and domination, the new money will mobilize them for healing andbeauty. Because money will not be under compulsion to grow, no longerwill art be under compulsion to sell itself. Today, any endeavor thatdoes not involve an expansion of the realm of monetized goods andservices must go against the economic current. Such is the character ofexponential money. But cyclical money has a different character:anything that violate's nature's law "Waste is food" will go againstthe economic current. The division between work and art will disappear,and it will no longer be possible to be a sellout. The conflict betweenour idealism and economic necessity will vanish.

This might seem hopelessly naive, vague, and idealistic. I draw out thelogic in The Ascent of Humanity and the previous essays in this series.My upcoming book will flesh it out in greater detail. For now, weighthe competing voices of your idealism and your cynicism, and askyourself, "Can you bear to settle for anything less?" Can you bear toaccept a world of great and growing ugliness? Can you stand to believethat it is inevitable? You cannot. Such a belief will slowly but surelykill your soul. That is because it is not true. The mind likescynicism, its comfort and safety, and hesitates to believe anythingextraordinary, but the heart urges otherwise; it urges us to beauty,and only by heeding its call can we dare create a new Story of thePeople.

We are here to create something beautiful; I call it "the morebeautiful world our hearts tell us is possible." As the truth of thatsinks in, deeper and deeper, and as the convergence of crises pushes usout of the old world, I think that more and more people will live fromthat truth: the truth that more for you is not less for me; the truththat what I do unto you, so I do unto myself; the truth of living togive what you can and take what you need. We can start doing it rightnow. We are afraid, but when we do it for real, the world meets ourneeds and more. We then find that the story of Separation, embodied inthe money we have known, is not true and never was. Yet, the last tenmillennia were not in vain. Sometimes it is necessary to live a lie toits fullest before we are ready to take the next step into the truth.The lie of separation in the age of usury is now complete. We haveexplored its fullness, its furthest extremes, and seen all it haswrought, the deserts and the prisons, the concentration camps and thewars, the wastage of the good, the true, and the beautiful. Now, thecapacities we have developed through this long journey of ascent willserve us well in the imminent Age of Reunion.