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The Ethics of Money Production
This pioneering work, in hardback, by Jörg Guido Hülsmann, professor of economics at the University of Angers in France and the author of The Last knight of Liberalism , is the first full study of a critically important issue the ethics of money production. He is speaking not in the colloquial sense of the phrase "making money," but rather the actual production of money as a commodity in the whole economic life. The choice of the money we use in exchange is not something that needs to be established and fixed by government. In fact, his thesis is that a government monopoly on money production and management has no ethical or economic grounding at all. Legal tender laws, bailout guarantees, tax-backed deposit insurance, and the entire apparatus that sustains national monetary systems, has been wholly unjustified. Money, he argues, should be a privately produced good like any other, such as clothing or food. In arguing this way, he is disputing centuries of assumptions about money for which an argument is rarely offered. People just assume that government or central banks operating under government control should manage money. Hulsmann explores monetary thought from the ancient world through the middle ages to modern times to show that the monopolists are wrong. There is a strong case in both economic and ethical terms for the idea that money production should be wholly private. He takes on the "stabilization" advocates to show that government management doesn't lead to stability but to inflation and instability. He goes further to argue against even the theoretical case for stabilization, to say that money's value should be governed by the market, and that that the costs associated with private production are actually an advantage. He chronicles the decline of money once nationalized, from legally sanctioned counterfeiting to the creation of paper money all the way to hyperinflation. In his normative analysis, the author depends heavily on the monetary writings of 14th century Bishop Nicole Oresme, whose monetary writings have been overlooked even by historians of economic thought. He makes a strong case that "paper money has never been introduced through voluntary cooperation. In all known cases it has been introduced through coercion and compulsion, sometimes with the threat of the death penalty. ... Paper money by its very nature involves the violation of property rights through monopoly and legal-tender privileges." The book is also eerily prophetic of our Consider the current U.S. real-estate boom. Many Americans are utterly convinced that American real estate is the one sure bet in economic life. No matter what happens on the stock market or in other strata of the economy, real estate will rise. They believe themselves to have found a bonanza, and the historical figures confirm this. Of course this belief is an illusion, but the characteristic feature of a boom is precisely that people throw any critical considerations overboard. They do not realize that their money producer the Fed has possibly already entered the early stages of hyperinflation, and that the only reason why this has been largely invisible was that most of the new money has been exported outside of the U.S... Because a paper-money producer can bail out virtually anybody, the citizens become reckless in their speculations; they count on him to bail them out, especially when many other people do the same thing. To fight such behavior effectively, one must abolish paper money. Regulations merely drive the reckless behavior into new channels. Hulsmann has provided not only a primer in understanding our times, but a dramatic extension of the work of Menger, Mises, Hayek, Rothbard, and others to map ou
280 pages, ebook
First published September 1, 2007
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August 10, 2018
شاید کمتر کسی است که در ایران زندگی کرده باشد و تورم را با گوشت و جانش احساس نکرده باشد. البته میزان تاثیر آن بر اقشار و افراد گوناگون، متفاوت است. همانطور که بسیاری از اقتصادادنان نیز از تورم به عنوان مالیات پنهان و ناعادلانه‌ترین شکل مالیات‌گیری یاد می‌کنند و معقتدند تورم به مثابه گرفتن مالیات از ضعیف‌ترین اقشار جامعه است.
اما شاید کمتر کسی از مردم عادی باشند که علت و ریشه تورم را بدانند. عام‌ترین تعریف از تورم عبارت است از: «افزایش بی‌رویه و مداوم سطح قیمت‌ها و نابرابری عرضه و تقاضای کل جامعه، فزونی تقاضا بر عرضه.» و علت و ریشه اصلی آن نیز چیزی نیست جز «هماهنگ نبودن افزایش پول (همان نقدینگی) در جامعه با افزایش تولید.» به عبارتی چاپ بی‌رویه پول یا همان پول بی‌پشتوانه علت اصلی تورم در جوامع است.
با پایان عصر تسلط اقتصاد کینزی و ظهور پول‌گرایان، به رهبری میلتون فریدمن، کشورها متوجه شدند که چگونه باید تورم را کنترل کنند و این شروعی شد بر استقلال بانک‌های مرکزی.
علی‌رغم تشابه بسیار زیاد پول‌گرایان با اقتصاددانان مکتب اتریش اما تفاوت و اختلاف‌های آنان شاید بیش از شباهت‌هایشان باشد. علی‌رغم باور هر دو مکتب به بازار آزاد، معرفت‌شناسی و روش‌شناسی این دو مکتب دو دنیای متفاوت است.
یکی از مهم‌ترین تفاوت‌های این دو مکتب به تفاوتشان در نظریه و سیاست پولی بازمی‌گردد. هرچند مکتب اتریش نیز مکتبی یکدست نیست و در خود این مکتب نیز اختلاف نظر وجود دارد اما اختلاف اتریشی‌ها و شیکاگویی‌ها در سیاست پولی، اختلافی است بنیادین.
هدف اصلی هولسمن، که خود یک اقتصادان مکتب اتریش است، در این کتاب طرح مسئله اخلاق در حوزه اقتصاد پولی است. وی معتقد است که از حدود 300 سال پیش اتحادی نامقدس میان سیاستمدارانِ قدرت‌طلب و بانکداران موجب شده است که تولید پول رفته رفته از اخلاقیات تهی شده و از منافع عمومی فاصله بگیرد.
هولسمن نیز همانند دیگر اتریشی‌ها عمیقا معقتد به اقتصاد بازار است و آن را تنها نظام سازگار با آزادی و کرامت انسانی می‌داند، از همین رو، همچون دیگر اتریشی‌ها مخالف سر سخت بانک‌های مرکزی است و بر این رای است که سیاست‌های پولی در اقتصادهای بازارِ امروزی تبدیل به ابزار اجحاف دولتمردان و صاحبان قدرت انحصاری به عامه مردم شده است.
از نظر هولسمن؛ تولید پول در اقتصادهای امروزی به طور انحصاری در اختیار نهادهای دولتی (بانک‌های مرکزی) است و این موضوع در تضاد با مبانی فلسفی اقتصاد بازار آزاد و مالکیت خصوصی است. او معتقد است «انحصار انتشار پول توسط دولتها و استفاده سیاستمداران از آن برای حل مشکلات مالی و اهداف سیاسی موجب بروز نتایج ناخواسته و زیان‌آوری مانند تورم، بی‌ثباتی در فضای کسب‌وکار و به هم‌خوردن کارکرد درست مکانیزم قیمت‌های رقابتی و نهایتا رکود و بیکاری می‌شود.»
هولسمن منتقد سرسخت پول دستوری و انحصاری بوده و معتقد است بانک مرکزی با منطق اقتصادی خودجوش و درونی نظام بازار شکل نگرفته است و وجود آن به شکلی کنونی نه تنها ضرورتی ندارد بلکه در ماهیت امر مضر، خلاف اصول بازار آزاد و در نهایت غیراخلاقی است. او معتقد است دلیلی ندارد که پول نیز در بازار آزاد خلق نگردد، چیزی که پیش از آغاز عصر مدرن و در قرون پیشین در جهان رواج داشته است.
هولسمن در این کتاب، که به نوعی نقد اقتصاد جریان اصلی است، از اردوگاه طرفداران اقتصاد بازار به نقد سیاست‌های کلان بر این اقتصادها می‌پردازد. کتاب علاوه بر نوآوری‌های نظری و رویکردی نو، اطلاعات مفیدی درباره تحولات نظام پولی در دوران مدرن نیز می‌دهد.
وی با استفاده از سنت واقع‌گرایی فلسفی به تحلیل پول و بانکداری می‌پردازد. «یکی از پیشگامان این رویکرد ریاضی‌دان، فیزیکدان، اقتصاددان و اسقف قرن چهاردم میلادی یعنی «نیکولاس اورسم» بوده است که اولین رساله درباره تورم یا به عبارتی دیگر اولین رساله درباره یک مشکل اقتصادی را نگاشته است.» هولسمن در جای‌جای این کتاب از رویکرد و رساله هولسمن برای بیان نظرات خود بهره می‌گیرد.
اگر علاقه‌مند به اقتصاد و فلسفه آن هستید این کتابی است به غایت خواندنی و روشنگر. رویکرد این کتاب، رویکردی سلبی و نه ایجابی است. خود هولسمن نیز معتقد است که کار و تحقیق باید روی این موضوع بیشتر و بیشتر انجام گیرد و این کتاب صرفا سعی می‌کند تلنگری باشد برای پژوهشگران این حوزه.
اگر طرفدار اقتصاد آزاد هستید و علاقه دارید درباره رویکردهای منتقد و خلاف جریان اصلی بیشتر بدانید مکتب اتریش شاید بهترین گزینه باشد. دکتر غنی‌نژاد، که خود ایشان نیز یکی از پیروان مکتب اتریش است، در مقدمه این کتاب نوشته‌اند:
«روشنگری‌های هولسمن در این کتاب گرانبها و راه‌حل‌هایش واقع‌بینانه است، گرچه ممکن است برای اذهان گرفتار در بند پارادایم غالب غریب به نظر آیند.»
اما شاید کمتر کسی از مردم عادی باشند که علت و ریشه تورم را بدانند. عام‌ترین تعریف از تورم عبارت است از: «افزایش بی‌رویه و مداوم سطح قیمت‌ها و نابرابری عرضه و تقاضای کل جامعه، فزونی تقاضا بر عرضه.» و علت و ریشه اصلی آن نیز چیزی نیست جز «هماهنگ نبودن افزایش پول (همان نقدینگی) در جامعه با افزایش تولید.» به عبارتی چاپ بی‌رویه پول یا همان پول بی‌پشتوانه علت اصلی تورم در جوامع است.
با پایان عصر تسلط اقتصاد کینزی و ظهور پول‌گرایان، به رهبری میلتون فریدمن، کشورها متوجه شدند که چگونه باید تورم را کنترل کنند و این شروعی شد بر استقلال بانک‌های مرکزی.
علی‌رغم تشابه بسیار زیاد پول‌گرایان با اقتصاددانان مکتب اتریش اما تفاوت و اختلاف‌های آنان شاید بیش از شباهت‌هایشان باشد. علی‌رغم باور هر دو مکتب به بازار آزاد، معرفت‌شناسی و روش‌شناسی این دو مکتب دو دنیای متفاوت است.
یکی از مهم‌ترین تفاوت‌های این دو مکتب به تفاوتشان در نظریه و سیاست پولی بازمی‌گردد. هرچند مکتب اتریش نیز مکتبی یکدست نیست و در خود این مکتب نیز اختلاف نظر وجود دارد اما اختلاف اتریشی‌ها و شیکاگویی‌ها در سیاست پولی، اختلافی است بنیادین.
هدف اصلی هولسمن، که خود یک اقتصادان مکتب اتریش است، در این کتاب طرح مسئله اخلاق در حوزه اقتصاد پولی است. وی معتقد است که از حدود 300 سال پیش اتحادی نامقدس میان سیاستمدارانِ قدرت‌طلب و بانکداران موجب شده است که تولید پول رفته رفته از اخلاقیات تهی شده و از منافع عمومی فاصله بگیرد.
هولسمن نیز همانند دیگر اتریشی‌ها عمیقا معقتد به اقتصاد بازار است و آن را تنها نظام سازگار با آزادی و کرامت انسانی می‌داند، از همین رو، همچون دیگر اتریشی‌ها مخالف سر سخت بانک‌های مرکزی است و بر این رای است که سیاست‌های پولی در اقتصادهای بازارِ امروزی تبدیل به ابزار اجحاف دولتمردان و صاحبان قدرت انحصاری به عامه مردم شده است.
از نظر هولسمن؛ تولید پول در اقتصادهای امروزی به طور انحصاری در اختیار نهادهای دولتی (بانک‌های مرکزی) است و این موضوع در تضاد با مبانی فلسفی اقتصاد بازار آزاد و مالکیت خصوصی است. او معتقد است «انحصار انتشار پول توسط دولتها و استفاده سیاستمداران از آن برای حل مشکلات مالی و اهداف سیاسی موجب بروز نتایج ناخواسته و زیان‌آوری مانند تورم، بی‌ثباتی در فضای کسب‌وکار و به هم‌خوردن کارکرد درست مکانیزم قیمت‌های رقابتی و نهایتا رکود و بیکاری می‌شود.»
هولسمن منتقد سرسخت پول دستوری و انحصاری بوده و معتقد است بانک مرکزی با منطق اقتصادی خودجوش و درونی نظام بازار شکل نگرفته است و وجود آن به شکلی کنونی نه تنها ضرورتی ندارد بلکه در ماهیت امر مضر، خلاف اصول بازار آزاد و در نهایت غیراخلاقی است. او معتقد است دلیلی ندارد که پول نیز در بازار آزاد خلق نگردد، چیزی که پیش از آغاز عصر مدرن و در قرون پیشین در جهان رواج داشته است.
هولسمن در این کتاب، که به نوعی نقد اقتصاد جریان اصلی است، از اردوگاه طرفداران اقتصاد بازار به نقد سیاست‌های کلان بر این اقتصادها می‌پردازد. کتاب علاوه بر نوآوری‌های نظری و رویکردی نو، اطلاعات مفیدی درباره تحولات نظام پولی در دوران مدرن نیز می‌دهد.
وی با استفاده از سنت واقع‌گرایی فلسفی به تحلیل پول و بانکداری می‌پردازد. «یکی از پیشگامان این رویکرد ریاضی‌دان، فیزیکدان، اقتصاددان و اسقف قرن چهاردم میلادی یعنی «نیکولاس اورسم» بوده است که اولین رساله درباره تورم یا به عبارتی دیگر اولین رساله درباره یک مشکل اقتصادی را نگاشته است.» هولسمن در جای‌جای این کتاب از رویکرد و رساله هولسمن برای بیان نظرات خود بهره می‌گیرد.
اگر علاقه‌مند به اقتصاد و فلسفه آن هستید این کتابی است به غایت خواندنی و روشنگر. رویکرد این کتاب، رویکردی سلبی و نه ایجابی است. خود هولسمن نیز معتقد است که کار و تحقیق باید روی این موضوع بیشتر و بیشتر انجام گیرد و این کتاب صرفا سعی می‌کند تلنگری باشد برای پژوهشگران این حوزه.
اگر طرفدار اقتصاد آزاد هستید و علاقه دارید درباره رویکردهای منتقد و خلاف جریان اصلی بیشتر بدانید مکتب اتریش شاید بهترین گزینه باشد. دکتر غنی‌نژاد، که خود ایشان نیز یکی از پیروان مکتب اتریش است، در مقدمه این کتاب نوشته‌اند:
«روشنگری‌های هولسمن در این کتاب گرانبها و راه‌حل‌هایش واقع‌بینانه است، گرچه ممکن است برای اذهان گرفتار در بند پارادایم غالب غریب به نظر آیند.»
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December 16, 2017کتاب خیلی خوبی بود از این نظر که به مبانی ایجاد پول در جوامع پرداخته بود. در مابقی کتاب که سعی شده بود مضرات ایجاد پول کاغذی و دستوری توسط دولتها رو بررسی کنه همه نکات جالبی بود. همچنین در مورد تورم .
March 13, 2024
This is a mustread to understand the origins and properties of money.
June 3, 2009
This book covers how money is produced in a theoretical/historical context and the ethical implications of money production. It certainly satisfied an intellectual craving and Hulsmann's religious perspective was interesting and not heavy handed. After all, he's using Catholic writings to criticize the state, not his reader's personal behavior (unless his reader is Bernanke)! However, this book was difficult - it is not for beginners and I may have picked it up a little too early in my amateur studies. I fully expect to read it again at a later date.
The book is short, so it necessarily assumes a certain amount of background knowledge. This includes: libertarian theory, especially the ethics of Rothbardians; basic economic theory, specifically Misesian economics. I could follow the Christian reasoning, but I am unable to make an informed judgment of Hulsmann's accuracy and logic in this area. The book has a narrow focus, so you will not see here a history of money production - it is much more theoretical. Also, as the author points out in his introduction, he is not discussing the ethics of money or capitalism - only the ethics of money *production*. It leaves one wanting, in a good way, to learn more about these peripheral areas.
If you've been studying Austrian economics for years, I highly recommend this book. Approach it with an open mind if you are not Christian/Catholic - although much of the book dwells on these areas, it is in an effort to show the long history of ethical thought in this area. Since the author is passionate about his faith, as well as liberty, there is much to learn from him.
The book is short, so it necessarily assumes a certain amount of background knowledge. This includes: libertarian theory, especially the ethics of Rothbardians; basic economic theory, specifically Misesian economics. I could follow the Christian reasoning, but I am unable to make an informed judgment of Hulsmann's accuracy and logic in this area. The book has a narrow focus, so you will not see here a history of money production - it is much more theoretical. Also, as the author points out in his introduction, he is not discussing the ethics of money or capitalism - only the ethics of money *production*. It leaves one wanting, in a good way, to learn more about these peripheral areas.
If you've been studying Austrian economics for years, I highly recommend this book. Approach it with an open mind if you are not Christian/Catholic - although much of the book dwells on these areas, it is in an effort to show the long history of ethical thought in this area. Since the author is passionate about his faith, as well as liberty, there is much to learn from him.
July 31, 2011
Great read about the history of money production. You can see that the author has a strong catholic background, but that does not seem to bias his logic and thoughts about the inner workings of money debasement and inflation. It is a very recommended read.
December 30, 2021
NOTE: the page numbers are for the Large Print Edition.
The manner and structure of Hülsmann's presentation and argumentation is top-notch, and so it makes it a bit easier to refute his asseverations. While I cannot vouch for the veracity of his historical breakdowns, I can definitely say a few things about the ethical bedrock on which he has scattered his rhetorical regolith.
In other words, this review will mostly concentrate on the Ethics, not the Money Production. I'm also going to warn you in advance that despite the good rating, my review will be rather critical and even vitriolic at times (I can't pretend that I wasn't a bit provoked at some of the contradictory conservatism displayed herein).
The whole of The Ethics of Money Production is based on the moral precept that private property should be inviolable. If a society and the economy thereof are based on this principle, they are "completely free" in Hülsmann's books. I don't think anyone dares to declare that property rights are something innate in humans, and thus it should be obvious that they have come about through legislation and the founding of societies - hence Hülsmann thinks that the government or whatever legislative body has to establish such rights, yet they should place no restrictions on them whatsoever.
A case in point: Hülsmann argues that the government is depriving him of his property rights if he cannot make money with his equipment. Or if he cannot drive a car on Sundays. Now, what's ridiculous about his statement is that since property rights are always established by a body, that establishment by definition also sets restrictions on such rights. And if a body has the right to establish such rights, why doesn't it suddenly have an equal right to restrict such rights even further - especially if this has been agreed on democratically? And besides, treating property rights as the holiest of all imposes severe moral dilemmas on the ideology - if someone is deemed unfit to drive a car (on Sundays or at all), I don't see any problem in precluding them from doing so - if such property rights could actually be exploited at the expense of far more important rights, like bodily and mental inviolability. (My rationale doesn't necessarily affect what Hülsmann proposes in his book, but it does cast aspersions on his ethical stance.)
Now, let's take a look at this "completely free society" - the Plutopia, if you will. In Plutopia, the citizens together decide on which monies they want to use, which products they would produce and what are the quantities and prices set for such products. There would be no taxation, because centralisation of governments is immoral - let people decide what they want to patronise, and so the necessary entrepreneurs, corporations and institutions prevail while all the impractical relics of the past remain where they belong. There would be a lot more to it, but I'm not entirely sure of the full implications myself.
Hülsmann thinks that Plutopia is the dog's bollocks, and perhaps it does have its advantages. Ideally, it would be jolly good if I could allocate my resources in solely such things which I regard valuable. Or that no one would tell me what to value and depreciate my valuables indiscriminately. But I think that Plutopia would only be a happy place for the financially/economically minded. The people who are not so disposed, like myself, would be terribly confused at the whole system: one would have to ascertain the currencies used in every region, one would have to have lots of different currencies available (depending on the people's choices, of course), one would have to do twice as much work in figuring out the trustworthiness of different actors, and weigh carefully the pros and cons of the providers of essential services. Now, while the inflationary system we live in does definitely have its grievous shortcomings, at the very least it (and other, less "free" systems as well) it allows the people to focus on what they're good at and what they truly are interested in. H��lsmann actually had the gall to state the opposite: "Money and financial questions [under inflation] come to play an exaggerated role in the life of man. Inflation makes societies materialistic." (etc. on p. 187). I think this balderdash could've been avoided, if Hülsmann would admit that there are more important moral points than simply the sacredness of private property - people definitely have other things on their plates than simply finances. Not to mention the fact that people generally focus on short-term goals if they're concentrating on their personal needs.
What's really intriguing and somewhat ludicrous about Hülsmann is that while he champions more or less untrammeled liberty of private property rights (at least he never pointed out anything to the contrary), his views on ethics remain very myopic. As a good Catholic, he obviously sees the current world as a nest of vice, where libertines hold sway and moral relativism stalks the land. It never even once seems to occur to him that morals, too, are open to freedom of choice (I'm sure the Catholics would love to hold on to "free will", after all) - just like how Christians pick their favourite bits from the Bible, or leave out the nasty ones; or even choose how the Scriptures ought to be interpreted; or even which books belong to the canon. Furthermore, people have a perfect right to choose between Christianity's Code of Ethics and the others - not that Christianity doesn't have good values, but the overall Code is very, very problematic, because it actually turns people into cherry-pickers of morals that can never rest on a proper, understandable foundation due to the Biblical inconsistencies.
[DIGRESSION: However, though I said that morals are open to freedom of choice, I did not mean to imply that there's a moral market out there, where people simply choose the flavour of the day. Like Hülsmann, I too believe that there are some time-tested moral precepts and that there are good moral principles (like the Kantian maxim with the inclusion of respecting people's dignity), but it would be silly to imply that such morals are inherent to humans: if they are, then we've done a bloody cock-up of the whole thing with our mental obfuscations. Rather, I believe that there are good principles, and they must be found and established. (The human rights, incidentally, are in my opinion a great set of such precepts, even though there are some superfluities in there as well, like the marriage bit.)]
Obviously, H. blames most of the current moral degradation on inflationary economic systems. He goes even as far as to say that "welfare state is inefficient - it provides comparatively lousy services at comparatively high costs" (as a Finn, I'd heartily like to disagree). Then he also laments how traditional families have been deprived of their most important functions, like edification and education - as if there ever was a time in the history of Mankind when the edification was mainly done by families! And if Hülsmann would prefer to burden the parents with pedagogical matters and pretend that pedagogical qualifications aren't important, then I must declare him off his rocker.
But let's hear from the man himself!
"The excessive welfare state of our day is an all-out direct attack on the producers of morals. But it weakens these morals also in indirect ways, most notably by subsidizing bad moral examples. The fact is that libertine "lifestyles" carry great economic risks. The welfare state socializes the costs of morally reckless behavior and therefore gives it far greater prominence than it would have in a free society. Rather than carrying an economic penalty, licentiousness might then actually go hand in hand with economic advantages, because it frees the protagonists from the costs of family life (for example, the costs associated with raising children). With the backing of the welfare state, these protagonists may mock conservative morals as some sort of superstition that has no real-life impact. The welfare state systematically exposes people to the temptation of believing that there are no time-tested moral precepts at all." (pp. 190-191).
By the "producers of morals", Hülsmann primarily refers to families, those great moral units who best understand the needs of their loved ones. Now, what he is driving at is that societies should comprise people who generally just mind their own business - but this is exactly the opposite of why societies (most likely) came to be in the first place: because they couldn't just mind their own business! And as a society, restrictions are perforce applied to its members so they could live more safely with their compromised rights (as opposed to the true liberty of the natural state). What truly makes a sustainable society, then, is not that we have lots of little independent units with minimum impact from the public sector, but rather a more unified society that shares its values (or is at the very least willing to discuss them) and passes them on to the next generations.
(Incidentally, it's somewhat strange that the crime rates have actually gone down during our times of inflationary systems as opposed to the previous ages, where the economic policies have been more sound in Hülsmann's terms. Could it be that a certain centralised stronghold of morality with its tithes and indulgences did not provide enough moral stability and meaning to people after all - or that the economic system itself is not directly responsible for people's morality? The question is, obviously, rhetorical.)
In other words, I don't agree with Hülsmann's conservative views at all. They're naive and shortsighted. But that doesn't mean that what he propounds in this book is completely discardable. He does a very good job at dissecting the evolution of inflationary systems, and quite rightly points out the questionable practices like the suspension of payments or the reckless printing of paper money. But as can be gathered from my review, I don't think the overall structure holds very well. The best thing about this book was, though, that Hülsmann walks the reader through the whole evolution very thoroughly, and so the reader can either accept Hülsmann's moral views or forge their own opinions. Hence 4 stars - it was all beautifully presented and argued, and thus it will be a great boon for someone like me who wants to figure things out for themselves - at least until a better theory is presented.
Finally, what's truly admirable is that despite his Catholic background, Hülsmann doesn't ram religion down the reader's throat. He does defer to his scholastic and papal authorities, not to mention the Scriptures, but he does in a very matter-of-fact fashion. In that regard, I do think he reserves some credit. (At least up until his unfortunate spew about traditional families.)
The manner and structure of Hülsmann's presentation and argumentation is top-notch, and so it makes it a bit easier to refute his asseverations. While I cannot vouch for the veracity of his historical breakdowns, I can definitely say a few things about the ethical bedrock on which he has scattered his rhetorical regolith.
In other words, this review will mostly concentrate on the Ethics, not the Money Production. I'm also going to warn you in advance that despite the good rating, my review will be rather critical and even vitriolic at times (I can't pretend that I wasn't a bit provoked at some of the contradictory conservatism displayed herein).
The whole of The Ethics of Money Production is based on the moral precept that private property should be inviolable. If a society and the economy thereof are based on this principle, they are "completely free" in Hülsmann's books. I don't think anyone dares to declare that property rights are something innate in humans, and thus it should be obvious that they have come about through legislation and the founding of societies - hence Hülsmann thinks that the government or whatever legislative body has to establish such rights, yet they should place no restrictions on them whatsoever.
A case in point: Hülsmann argues that the government is depriving him of his property rights if he cannot make money with his equipment. Or if he cannot drive a car on Sundays. Now, what's ridiculous about his statement is that since property rights are always established by a body, that establishment by definition also sets restrictions on such rights. And if a body has the right to establish such rights, why doesn't it suddenly have an equal right to restrict such rights even further - especially if this has been agreed on democratically? And besides, treating property rights as the holiest of all imposes severe moral dilemmas on the ideology - if someone is deemed unfit to drive a car (on Sundays or at all), I don't see any problem in precluding them from doing so - if such property rights could actually be exploited at the expense of far more important rights, like bodily and mental inviolability. (My rationale doesn't necessarily affect what Hülsmann proposes in his book, but it does cast aspersions on his ethical stance.)
Now, let's take a look at this "completely free society" - the Plutopia, if you will. In Plutopia, the citizens together decide on which monies they want to use, which products they would produce and what are the quantities and prices set for such products. There would be no taxation, because centralisation of governments is immoral - let people decide what they want to patronise, and so the necessary entrepreneurs, corporations and institutions prevail while all the impractical relics of the past remain where they belong. There would be a lot more to it, but I'm not entirely sure of the full implications myself.
Hülsmann thinks that Plutopia is the dog's bollocks, and perhaps it does have its advantages. Ideally, it would be jolly good if I could allocate my resources in solely such things which I regard valuable. Or that no one would tell me what to value and depreciate my valuables indiscriminately. But I think that Plutopia would only be a happy place for the financially/economically minded. The people who are not so disposed, like myself, would be terribly confused at the whole system: one would have to ascertain the currencies used in every region, one would have to have lots of different currencies available (depending on the people's choices, of course), one would have to do twice as much work in figuring out the trustworthiness of different actors, and weigh carefully the pros and cons of the providers of essential services. Now, while the inflationary system we live in does definitely have its grievous shortcomings, at the very least it (and other, less "free" systems as well) it allows the people to focus on what they're good at and what they truly are interested in. H��lsmann actually had the gall to state the opposite: "Money and financial questions [under inflation] come to play an exaggerated role in the life of man. Inflation makes societies materialistic." (etc. on p. 187). I think this balderdash could've been avoided, if Hülsmann would admit that there are more important moral points than simply the sacredness of private property - people definitely have other things on their plates than simply finances. Not to mention the fact that people generally focus on short-term goals if they're concentrating on their personal needs.
What's really intriguing and somewhat ludicrous about Hülsmann is that while he champions more or less untrammeled liberty of private property rights (at least he never pointed out anything to the contrary), his views on ethics remain very myopic. As a good Catholic, he obviously sees the current world as a nest of vice, where libertines hold sway and moral relativism stalks the land. It never even once seems to occur to him that morals, too, are open to freedom of choice (I'm sure the Catholics would love to hold on to "free will", after all) - just like how Christians pick their favourite bits from the Bible, or leave out the nasty ones; or even choose how the Scriptures ought to be interpreted; or even which books belong to the canon. Furthermore, people have a perfect right to choose between Christianity's Code of Ethics and the others - not that Christianity doesn't have good values, but the overall Code is very, very problematic, because it actually turns people into cherry-pickers of morals that can never rest on a proper, understandable foundation due to the Biblical inconsistencies.
[DIGRESSION: However, though I said that morals are open to freedom of choice, I did not mean to imply that there's a moral market out there, where people simply choose the flavour of the day. Like Hülsmann, I too believe that there are some time-tested moral precepts and that there are good moral principles (like the Kantian maxim with the inclusion of respecting people's dignity), but it would be silly to imply that such morals are inherent to humans: if they are, then we've done a bloody cock-up of the whole thing with our mental obfuscations. Rather, I believe that there are good principles, and they must be found and established. (The human rights, incidentally, are in my opinion a great set of such precepts, even though there are some superfluities in there as well, like the marriage bit.)]
Obviously, H. blames most of the current moral degradation on inflationary economic systems. He goes even as far as to say that "welfare state is inefficient - it provides comparatively lousy services at comparatively high costs" (as a Finn, I'd heartily like to disagree). Then he also laments how traditional families have been deprived of their most important functions, like edification and education - as if there ever was a time in the history of Mankind when the edification was mainly done by families! And if Hülsmann would prefer to burden the parents with pedagogical matters and pretend that pedagogical qualifications aren't important, then I must declare him off his rocker.
But let's hear from the man himself!
"The excessive welfare state of our day is an all-out direct attack on the producers of morals. But it weakens these morals also in indirect ways, most notably by subsidizing bad moral examples. The fact is that libertine "lifestyles" carry great economic risks. The welfare state socializes the costs of morally reckless behavior and therefore gives it far greater prominence than it would have in a free society. Rather than carrying an economic penalty, licentiousness might then actually go hand in hand with economic advantages, because it frees the protagonists from the costs of family life (for example, the costs associated with raising children). With the backing of the welfare state, these protagonists may mock conservative morals as some sort of superstition that has no real-life impact. The welfare state systematically exposes people to the temptation of believing that there are no time-tested moral precepts at all." (pp. 190-191).
By the "producers of morals", Hülsmann primarily refers to families, those great moral units who best understand the needs of their loved ones. Now, what he is driving at is that societies should comprise people who generally just mind their own business - but this is exactly the opposite of why societies (most likely) came to be in the first place: because they couldn't just mind their own business! And as a society, restrictions are perforce applied to its members so they could live more safely with their compromised rights (as opposed to the true liberty of the natural state). What truly makes a sustainable society, then, is not that we have lots of little independent units with minimum impact from the public sector, but rather a more unified society that shares its values (or is at the very least willing to discuss them) and passes them on to the next generations.
(Incidentally, it's somewhat strange that the crime rates have actually gone down during our times of inflationary systems as opposed to the previous ages, where the economic policies have been more sound in Hülsmann's terms. Could it be that a certain centralised stronghold of morality with its tithes and indulgences did not provide enough moral stability and meaning to people after all - or that the economic system itself is not directly responsible for people's morality? The question is, obviously, rhetorical.)
In other words, I don't agree with Hülsmann's conservative views at all. They're naive and shortsighted. But that doesn't mean that what he propounds in this book is completely discardable. He does a very good job at dissecting the evolution of inflationary systems, and quite rightly points out the questionable practices like the suspension of payments or the reckless printing of paper money. But as can be gathered from my review, I don't think the overall structure holds very well. The best thing about this book was, though, that Hülsmann walks the reader through the whole evolution very thoroughly, and so the reader can either accept Hülsmann's moral views or forge their own opinions. Hence 4 stars - it was all beautifully presented and argued, and thus it will be a great boon for someone like me who wants to figure things out for themselves - at least until a better theory is presented.
Finally, what's truly admirable is that despite his Catholic background, Hülsmann doesn't ram religion down the reader's throat. He does defer to his scholastic and papal authorities, not to mention the Scriptures, but he does in a very matter-of-fact fashion. In that regard, I do think he reserves some credit. (At least up until his unfortunate spew about traditional families.)
October 17, 2020
It was interesting to see a book like this written from a Christian natural law perspective (which is basically my own perspective)... and yet to see the author get pretty much everything wrong about monetary theory! I agree with him fully regarding the ethical principles in question, but the author fundamentally misunderstands what money *is* and how banking works, and therefore his ethics are not applied properly. I recommend skipping this book. What is true in the book is already obvious to any Christian (do not steal, do not lie), and what is mistaken in the book is unhelpfully confusing and misleading. Monetary theory is hard enough to understand without books like this one muddling the matter and making it harder to sort through.
In reality, money is credit. This is true both empirically and theoretically. "Fractional reserve" banking is also an archaic misnomer, and a bit misleading conceptually, because money today is fully backed by collateral and loans (the "reserve" today refers to more liquid loans, as opposed to less liquid loans). Personally I am in favor of decentralized free market contract-based money. In other words, I am in favor of pretty much what we have in the USA today, except I think that legal tender laws should be abolished (like they are in Australia... it wouldn't make much difference practically getting rid of legal tender laws, just as it doesn't make much of a difference in Australia, but it would be better in principle in the long-term, and certainly better pedagogically too!).
Monetary theory is widely misunderstood, both inside academia and outside it. Rather than just panning this book, I feel obligated to point to good resources instead. So here you go:
Cullen Roche wrote some papers on monetary theory which are very helpful. He explains in good detail how modern banking and currency works, and he also has some basic rebuttals against the some of the emphases of socialistic 'modern monetary theory' folks make when they talk about this subject:
https://papers.ssrn.com/sol3/cf_dev/A...
I gave a lecture on monetary theory at the 2019 Davenant Institute Convivium designed to be an introduction to the subject. I couldn't find any easy to understand introduction anywhere, so I wrote one myself. I designed it to be accessible to highschoolers... hopefully I succeeded! You can listen to the talk here:
https://soundcloud.com/user-240690980...
There are also two classic essays by Alfred Mitchell Innes. They're good, but a bit dated (published in 1913 and 1914)
First essay: https://www.newmoneyhub.com/www/money...
Second essay: https://www.newmoneyhub.com/www/money...
Finally, Ruben Alvarado's book "Follow the Money" is also excellent. However, it's mainly an application of this theory to history. His book will probably make more sense after reading the various essays above.
In reality, money is credit. This is true both empirically and theoretically. "Fractional reserve" banking is also an archaic misnomer, and a bit misleading conceptually, because money today is fully backed by collateral and loans (the "reserve" today refers to more liquid loans, as opposed to less liquid loans). Personally I am in favor of decentralized free market contract-based money. In other words, I am in favor of pretty much what we have in the USA today, except I think that legal tender laws should be abolished (like they are in Australia... it wouldn't make much difference practically getting rid of legal tender laws, just as it doesn't make much of a difference in Australia, but it would be better in principle in the long-term, and certainly better pedagogically too!).
Monetary theory is widely misunderstood, both inside academia and outside it. Rather than just panning this book, I feel obligated to point to good resources instead. So here you go:
Cullen Roche wrote some papers on monetary theory which are very helpful. He explains in good detail how modern banking and currency works, and he also has some basic rebuttals against the some of the emphases of socialistic 'modern monetary theory' folks make when they talk about this subject:
https://papers.ssrn.com/sol3/cf_dev/A...
I gave a lecture on monetary theory at the 2019 Davenant Institute Convivium designed to be an introduction to the subject. I couldn't find any easy to understand introduction anywhere, so I wrote one myself. I designed it to be accessible to highschoolers... hopefully I succeeded! You can listen to the talk here:
https://soundcloud.com/user-240690980...
There are also two classic essays by Alfred Mitchell Innes. They're good, but a bit dated (published in 1913 and 1914)
First essay: https://www.newmoneyhub.com/www/money...
Second essay: https://www.newmoneyhub.com/www/money...
Finally, Ruben Alvarado's book "Follow the Money" is also excellent. However, it's mainly an application of this theory to history. His book will probably make more sense after reading the various essays above.
November 19, 2022
After reading this book, you will think very differently about money: what it is, what it means, what kind of ethical framework should surround it, and why inflating the money supply is one of civilization's great moral and ethical failings. The author asserts, convincingly, that money can and should be private, competitive, not centralized, and never under the monopoly control of the state. The temptation to inflate (and thereby steal) is too great.
Inflation is a feature, not a bug, of mo... [see the rest on my book review site.]
Inflation is a feature, not a bug, of mo... [see the rest on my book review site.]
May 22, 2022
paper money exposed
This book gives a background analysis of what has constituted money over the ages. It also does a good job of describing the ultimate flaws of paper money. Inflation big government wealth disparity and ultimately a collapse of the currency and of the economy in a hyperinflationary crash or a uncontrollable economic freeze due to price credit and trade controls
This book gives a background analysis of what has constituted money over the ages. It also does a good job of describing the ultimate flaws of paper money. Inflation big government wealth disparity and ultimately a collapse of the currency and of the economy in a hyperinflationary crash or a uncontrollable economic freeze due to price credit and trade controls
August 15, 2022
Dr. Hullsmann successfully bridges the gap from the Austrian analysis of the theory and history of Money and Banking to Catholic social ethics.
A must read for those with decision making power in state governments as they discern their proper relationship to the federal reserve and the central government.
A must read for those with decision making power in state governments as they discern their proper relationship to the federal reserve and the central government.
March 17, 2019
Wonderful book on the consequences of moder money production; nice intersection of history, ethics and economics. Goes very well together with Rothbards's Mystery of Banking, which is more focused on some technical details of banking, e.g. fractional reserves.
May 4, 2020
Great Overview
Book was published pre-bitcoin, so reading it while also bring aware of Bitcoin makes the discussions even more relevant. For example, when problems with the classical gold standard are raised, it is easy to see that "Bitcoin fixes this".
Book was published pre-bitcoin, so reading it while also bring aware of Bitcoin makes the discussions even more relevant. For example, when problems with the classical gold standard are raised, it is easy to see that "Bitcoin fixes this".
October 8, 2018
Definitely worth reading. His study of money productions gives you a great overview of its effects. Just met him one week ago in Krakow. Great academic and person!
April 22, 2022
Inflation got us all messed up.
This entire review has been hidden because of spoilers.
March 14, 2023
Very interesting
October 7, 2016
A quote which is often attributed to Einstein is that, 'if you can't explain it simply enough, then you don't understand it.' In this book Jorg Guido Hulsman takes the complex subject of money, how it is comes into being, and how it circulates in the economy and what happens when human action interferes with the processes with which money comes in and out of existence. I especially liked that Prof. Hulsman discusses not only money as an abstract concept but the various types of money (physical and electronic)... an added bonus of this book is that it is also in many ways simultaneously a study of the history of money and economics. I have included links below which added to my experience of the book.
Resources:
1. E-Book: https://mises.org/sites/default/files...
2. Lecture by the Author: https://www.youtube.com/watch?v=8zYg4...
Resources:
1. E-Book: https://mises.org/sites/default/files...
2. Lecture by the Author: https://www.youtube.com/watch?v=8zYg4...
July 16, 2019
It is a work written by representative of the Austrian school of economics on the production of money by the banks and the state. The author presents different problems associated with these issues from the point of view of his economic school and Christianity. Hülsmann presents throughout the book the economic problems and quotes popes and theologians. The book therefore concerns of both economics and ethics. The first chapters deal with the beginnings of banking and its problems. In subsequent chapters the author describes the problems of the modern monetary systems and associated inflation. At the end you will find a description of international money standards.
I think this book is very good extension of What Has Government Done to Our Money? and The Case for the 100 Percent Gold Dollar. I would recommend it to anyone. But if you advanced in this subject, you don't find many new things.
//polish
Jest to praca przedstawiciela austriackiej szkoły ekonomii na temat produkcji pieniądza przez banki i państwa. Autor przedstawia różne problemy związane z tą tematyką z punktu widzenia swojej szkoły ekonomicznej oraz chrześcijaństwa. Hülsmann przez całą książkę przedstawia problemy ekonomiczne oraz cytuje papieży i teologów. Książka dotyczy więc zarówno ekonomii, jak i etyki. Pierwsze rozdziały dotyczą początków bankowości i jej problemów. W kolejnych rozdziałach autor opisuje problemy związane z nowoczesnymi systemami monetarnymi i związaną z nimi inflacją. Pod koniec znajdziemy także opis międzynarodowych standardów walutowych.
Myślę, że książka jest bardzo dobrym rozszerzeniem Złoto, banki, ludzie - krótka historia pieniądza Murraya Rothbarda. Polecam ją każdemu. Jeśli jesteś jednak obeznany z tym tematem, to nie znajdziesz tutaj wielu nowych informacji.
I think this book is very good extension of What Has Government Done to Our Money? and The Case for the 100 Percent Gold Dollar. I would recommend it to anyone. But if you advanced in this subject, you don't find many new things.
//polish
Jest to praca przedstawiciela austriackiej szkoły ekonomii na temat produkcji pieniądza przez banki i państwa. Autor przedstawia różne problemy związane z tą tematyką z punktu widzenia swojej szkoły ekonomicznej oraz chrześcijaństwa. Hülsmann przez całą książkę przedstawia problemy ekonomiczne oraz cytuje papieży i teologów. Książka dotyczy więc zarówno ekonomii, jak i etyki. Pierwsze rozdziały dotyczą początków bankowości i jej problemów. W kolejnych rozdziałach autor opisuje problemy związane z nowoczesnymi systemami monetarnymi i związaną z nimi inflacją. Pod koniec znajdziemy także opis międzynarodowych standardów walutowych.
Myślę, że książka jest bardzo dobrym rozszerzeniem Złoto, banki, ludzie - krótka historia pieniądza Murraya Rothbarda. Polecam ją każdemu. Jeśli jesteś jednak obeznany z tym tematem, to nie znajdziesz tutaj wielu nowych informacji.
July 27, 2016
This is one of the gems of monetary theory. This book cleared so many concepts that were nagging my mind for a long time. As the articles and paraphernalia available on monetary system seemed to confuse me more than illuminate about the subject.
Pros:
1. Start the topics from the basic of money production right to use of metals as money.
2. Takes from the advent of metallic money(Gold/Silver) to paper notes and involvement of government and bankers at each step.
3. While reading this book it appears conspicuous why centralization of Banks occur and also the cause of hyperinflation in our society. As this book was written before sub-prime crises so the authors stand vindicated.
4. Easy explanation of all concepts based on people's interaction in free markets and free from economic jargon, which is a basic tenant of Austrian School of Economics.
Cons:
1. Lack of more examples to clear every concept. It could have drive the point home more thoroughly. I have to make mind maps along the way to keep track of explanations, which is necessary as each chapter builds on the previous one to explain the consequences of new policies.
2. The author is a christian apologist so you have to bear with the mentions of Christ and Saints and theologians throughout to understand the sinful nature of crimes :). Crimes will be crimes under any moral principal. You have to bear if you want to understand the concepts.
3. The German hyperinflation of 1919-1923 or Chinese Hyperinflation of 955-1405 could have been highlighted to explain the dangerous consequences of fail of Breton Woods system.
4. Author could have highlighted the need of educating people in government and public to need to know this basic economics in order to deal with the consequences but he have merely clubbed everybody in group of wrongdoers purporting misery.
Overall a great book, its short and concise and if you retain the facts presented in the books you could become perspicacious enough to cut through all the legal jargon available for any new policy.
Pros:
1. Start the topics from the basic of money production right to use of metals as money.
2. Takes from the advent of metallic money(Gold/Silver) to paper notes and involvement of government and bankers at each step.
3. While reading this book it appears conspicuous why centralization of Banks occur and also the cause of hyperinflation in our society. As this book was written before sub-prime crises so the authors stand vindicated.
4. Easy explanation of all concepts based on people's interaction in free markets and free from economic jargon, which is a basic tenant of Austrian School of Economics.
Cons:
1. Lack of more examples to clear every concept. It could have drive the point home more thoroughly. I have to make mind maps along the way to keep track of explanations, which is necessary as each chapter builds on the previous one to explain the consequences of new policies.
2. The author is a christian apologist so you have to bear with the mentions of Christ and Saints and theologians throughout to understand the sinful nature of crimes :). Crimes will be crimes under any moral principal. You have to bear if you want to understand the concepts.
3. The German hyperinflation of 1919-1923 or Chinese Hyperinflation of 955-1405 could have been highlighted to explain the dangerous consequences of fail of Breton Woods system.
4. Author could have highlighted the need of educating people in government and public to need to know this basic economics in order to deal with the consequences but he have merely clubbed everybody in group of wrongdoers purporting misery.
Overall a great book, its short and concise and if you retain the facts presented in the books you could become perspicacious enough to cut through all the legal jargon available for any new policy.
September 6, 2017
2 stars for gold nuggets found in an otherwise chaotic disappointment
With precious little written on the topic, and billed as a pioneering work, I was excited to get my hands on this book....Overall I found this book hard to follow and not completely organized. Much of the material is explained more clearly and concisely in other works. It is an introduction, yet it is a poor summary. Both the organization of the monetary technical concepts, and the emphasis and categorization of ethical problems, the point of the book, are lacking. The poor format and loose discussion were disappointing.
That said, this book is still valuable. These merits make it worth the read:
- There are a few new thoughts, and a smattering of interesting points are made.
- The introduction to Nicholas Oresme.
- Ch13 is the highlight. "The Cultural and Spiritual Legacy of Fiat Inflation"
Note: Exclusively Catholic ethics considered. This is fine overall since ethically Catholics are pretty solid, but occasionally Church doctrine rather than Christian doctrine may be an issue and must be watched for. Just something to note. Though from an academic perspective it might be helpful to constrain the discussion by using statements of Catholic popes, this probably isn't the most accurate representation of true Christian ethics.
With precious little written on the topic, and billed as a pioneering work, I was excited to get my hands on this book....Overall I found this book hard to follow and not completely organized. Much of the material is explained more clearly and concisely in other works. It is an introduction, yet it is a poor summary. Both the organization of the monetary technical concepts, and the emphasis and categorization of ethical problems, the point of the book, are lacking. The poor format and loose discussion were disappointing.
That said, this book is still valuable. These merits make it worth the read:
- There are a few new thoughts, and a smattering of interesting points are made.
- The introduction to Nicholas Oresme.
- Ch13 is the highlight. "The Cultural and Spiritual Legacy of Fiat Inflation"
Note: Exclusively Catholic ethics considered. This is fine overall since ethically Catholics are pretty solid, but occasionally Church doctrine rather than Christian doctrine may be an issue and must be watched for. Just something to note. Though from an academic perspective it might be helpful to constrain the discussion by using statements of Catholic popes, this probably isn't the most accurate representation of true Christian ethics.
July 27, 2017
"The Ethics of Money Production" is a fantastic integration of Austrian economics and Catholic moral teachings as it relates to the production of money. The book consists of three parts: 1) the natural production of money on the free market, 2) the production of money through inflation; and 3) applying the earlier theoretical work towards the analysis of monetary orders, which is "the total network of persons, firms, and other organizations involved in the production of money." Hulsmann's conclusion is that modern-day "capitalism" is not based built upon respect for the institutions of private property, freedom of association, and the division of labor, but rather relies, in far too great an extent, on paper money and fractional-reserve banking, both of which rely on government dictate instead of the voluntary decisions of individuals through the nexus of economic exchange. Hulsmann's prose is patient, straightforward, and understandable to the layman interested in understanding the effects of monetary policy not only on economic activity in general, but also on the ethics and morals subjected to inflation.
November 4, 2016
I do wish the author went a little deeper on some of the historical discussions, but this is still an excellent read. I have never really thought about the ethics of how money is produced. It seems obvious to me the importance now after having read this. The book is missing a discussion on forms of money like Bitcoin, but that's only because it was published prior to the development of the monetary technology.
February 9, 2011
Asks questions about monetary policy not usually addressed. Is is stealing to simply print money and buy real things with it?
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