A memorable book about money sparks memories of an in-flight conversation
by Geoff Olson
• Back in 1998, I was sitting on a plane at Heathrow airport, thumbing through a volume on finance I had picked up in a London bookshop. It wasn’t my usual area of interest, but the title caught my eye: Frozen Desire: An Inquiry Into the Meaning of Money.
This nonfiction work by former Financial Times writer James Buchan turned out to be an appropriate choice for in-flight reading. As the jet began to taxi onto the runway, a white-haired man in the seat next to me struck up a conversation. Let’s call him Ted. “I always fly coach even though I can afford first class,” Ted said. A resident of the Lower Mainland, he described his boat, his travels and his post-retirement consulting work, which involved buying up companies around the globe and “making them more profitable” by taking them apart.
Ted’s job was to identify functioning companies that were worth more to investors in pieces. This meant outsourcing, downsizing and smashing pension funds like kids’ piggy banks. Although the tern “vulture capitalism” was not in currency at the time, Ted sounded like one of the carrion feeders. Essentially, he was in the same kind of business, at the same time, as Republican presidential candidate Mitt Romney, who’s been taking heat for his “disaster capitalism” tenure at Bain Capital.
With a wry smile, Ted told me he hadn’t paid taxes in Canada in 18 years. He said he directed most of his money into offshore investments, but Revenue Canada eventually took note of the gap between his living standards and his tax statements and audited him. The case went to court where Ted protested his innocence. “But you pay no taxes!” replied the judge, who released him after finding no technical violations of any laws.
From one angle, this amiable guy was simply a rational actor in the booming, Clinton-era market. Adam Smith’s invisible hand was guiding his money to a safer berth while he played Where’s Waldo with Revenue Canada. From another angle (mine), Ted was a corporate welfare cheat. By the late nineties, the de-industrialization and financialization of the western economy was in progress and this character was playing his bit part by wrecking functioning companies for profit. I was alternately fascinated and repelled by my airline companion’s remarks and eventually the conversation petered out, replaced with the muffled howl of wind rushing against the fuselage. I returned to my salted peanuts and Buchan’s book.
The Stephen Hawkings and Niall Fergusons of the publishing world are rare and Buchan is not among them. Nonfiction studies of deep topics don’t usually fly off the shelves and in spite of some stellar reviews in 1997 for Frozen Desire, it had about as much impact as a Post-It note dropped into the Grand Canyon. Yet the lucid and luminous volume deserves a wider audience, especially now that money has come to dominate every sphere of human experience from the boardroom to the bedroom.
Most writers and thinkers on the left limit their criticism of money to its allocation, rather than its nature. Buchan isn’t concerned about who gets how big a slice of pie; he questions the pie itself and the oven it was baked in. In his mix of memoir and historical survey, he identifies money as “frozen desire,” an abstract representation of human wishes that sheds old forms to take on new ones, from cowrie shells to precious metals to various kinds of surrogate money such as bill of exchange, local cheques, marketable securities and certificates of deposit, municipal bonds, annuities and derivatives.
Buchan is the Eton-educated son of William Buchan, 3rd Baron Tweedsmuir. According to a Wikipedia entry for the author, in 1986 he married Lady Evelyn Rose Phipps, daughter of Oswald Phipps, 4th Marquess of Normanby. A novelist and former contributor to the Financial Times, Buchan is that rare bird, a blueblood conservative that has lost faith in money even though he doesn’t lack for it. He sees the market as a false idol and this golden calf – or bronze bull if you prefer – is cut with fool’s gold. (Buchan’s musings are supported by the investigations of anthropologist David Graeber. In his 2011 book, Debt: The First 5,000 Years, Graeber determines that money did not have its beginnings as a replacement for barter, but mostly as a means of transacting the business of slavery and war.)
In the 1970s, at the height of the Arab oil embargo, Buchan’s career as a business reporter took him to a sweltering outpost in Jordan. His status as a writer grew along with his savings and in an illuminating moment he recognized how interest-bearing investments can overtake an hourly wage. “The money… began to breed, first slowly, then convulsively. While I slept, or was drunk, or made love, or smoked a Dunhill on the porch, my money worked; and far as I could tell, with smaller effort and for greater reward than I did.”
Like most of us, the author’s feelings about money are mixed, although you can probably guess what side of the delight/disgust side of the spectrum he’s on. From the photograph on the dust jacket of Frozen Desire, it seems as if the photographer had just held something foul under Buchan’s nose. The stench has a long pedigree. Most of the world religions nurse a deep ambivalence about money and credit. For centuries, the Catholic Church made usury a crime and, to this day, Islamic banks strictly limit interest. In the New Testament, Jesus recognizes money as a competitive authority, with the understanding that “in embodying happiness and reward in tangible, earthly form, money is more impressively heaven than heaven.”
In the New Testament, Christ’s birth in Bethlehem was presided over by the gift economy, with the Three Wise Men bearing gold, Frankincense and Myrrh. His death was sealed by the money economy, in the form of 30 pieces of silver the Romans paid to the turncoat apostle Judas.
Jesus is also remembered in the Gospels for kicking over the moneychangers’ tables in the temple. While the author is not explicitly endorsing religion over secularism, he insists the Biblical tale of market-mediated crucifixion anticipates the effect of capital on cultures of the west. Money can stand in for human relations as a substitute for trust in people. “It will displace trust in all human relations except those of the inner family,” Buchan writes, summing up the problem in one memorable sentence: “Money enters into the system of values, and then displaces all other values like the cuckoo’s egg in a nest.
“For some time, in many places, money was thought to be bad, but it is now thought, on the whole, to be good. That inversion is the greatest to have occurred in the moral sentiments of the West. Desires that resisted incorporation into money turned pale and lost their power to convince: disinterested friendship, love and philanthropy became as suspect as the goals of once passionate wishes, honour and salvation. Miserliness, which places potential above actual gratification, had once seemed the disease of money… gradually, it lost its pathology and became the condition of moral health.”
From the Enlightenment on, as the lure of filthy lucre mated with technical advances in communication and printing, money became the yardstick for all that is good and true. “Only money would measure success or failure, happiness or misery. Only money could reward or punish. States and governments must just stand back and money – which reconciles all clashes of human will – would see us right,” Buchan notes.
The identification of the almighty dollar with the imperial ego came to fruition in the eighties, during the reign of Reagan, Mulroney and Thatcher and the latter’s TINA doctrine (“There is No Alternative”). The Iron Lady’s parallel dictum, “There is no such thing as society,” served as both as a ‘Dear John’ letter to the public sector and a greeting card to Moloch. By the time I was 30,000 feet above the Atlantic reading Frozen Desire for the first time, the game was well underway in the AngloAmerican world: socialism for the rich and capitalism for everyone else. One year after my return from London, President Bill Clinton would sign away the firewall between commercial and investment banks, the Glass-Steagall Act, freeing Wall Street robber barons for even greater plunder.
In a world governed by money, private vices are reinterpreted as public virtues “and the old private virtues – prudence, thrift, kindness – become public vices in the market economy.” For Buchan, this is the great sadness at the heart of our civilization: that “by using money, we convert our world into it.”
That conversion is ongoing. In the 2003 film The Corporation, former Fraser Institute chairman Michael Walker enthused about a future where there is a sticker price on everything, down to every stream and rock on the planet. A mere nine years later, the fever dream of privatizers and profiteers is turning into a waking nightmare for the planet. With the growing global market in carbon credits, financial institutions have partnered with governments and captured environmental groups to put a price on the very air we breathe.
When Buchan’s book was first released, the financial elite still concealed their deepest desires and darkest doings in coded language. No longer. “Plutocracy” is a word that means rule by the rich and in 2005 Citigroup coined a variation of it with the term “plutonomy.” This shiny, new term, minted in the bowels of a megabank, refers to a system in which the rich side with government to ensure the continued domination of their class. The following year Citigroup decided to bang the drum for the elite by releasing an “equity strategy” for investors entitled “Revisiting Plutonomy: The Rich Getting Richer.” Among the quotes from this document is this giveaway: “…the top 10%, particularly the top 1% of the US – the plutonomists in our parlance – have benefited disproportionately from the recent productivity surge in the US… from globalization and the productivity boom, at the relative expense of labour.” Karl Marx couldn’t have put it any better.
This brings me back to Ted. It seemed he regarded Canada as little more than a country club with acceptable green fees and moorage, but lacking a place to properly stash his cash. “The IMF almost shut down Canada last year,” he told me with a look of shared confidence, suggesting the country was close to being taken apart like a bankrupt sawmill. The irony was thicker than the mystery-meat of my in-flight meal. Whatever the merit of his IMF anecdote, he had no interest in making the connection between his own sociopathic behaviour and the nation’s solvency.
Since my first and last acquaintance with this high-flying plutonomist, the world of finance has become more invasive into our daily lives even as its practices have become more nakedly criminal and the philanthropy of business titans more desperately public. My airline companion’s sentiments are, arguably, now even closer in line with the values of Wall Street and Bay Street.
Of course, the reader might object that Ted’s tax evasion could have been reigned in by tighter regulation. Straighten out the loopholes and plug any gaps that sociopaths can wriggle through and we will have the revenue necessary to fund our dwindling social programs. Even if North American leaders were willing and able to back-engineer accountability, I imagine Buchan would applaud the idea in one sentence and condemn it as a halfway measure in the next. He sees the problem in capital itself, or at least its current form, that favours the plutocrats over the rest of the populace. At the very least, money talks and those with the most of it have the biggest megaphone. Strangely, Frozen Desire does not address the most problematic form of money – fiat currency, which can be printed on demand and leveraged to insane levels.
Five years after Citigroup’s scented letter to its investors, the one percent/ninety-nine percent has gone from a political slogan to a placard-scrawled cliché. By November of last year, the streets of New York, Athens, Santiago, Vancouver and hundreds of other cities across the world filled with millions of protestors against the criminality of unregulated finance. Plutonomy is on the move across the globe and rising awareness of its social costs is on the move with it.
Today, money utterly dominates politics, social policy and the media. We may rail against the commodification of our lives, yet money remains the measure of all things, whether it’s in the mirrored canyons of the world’s financial districts or in the poorest shantytowns of the developing world. “And that is precisely why the untrammelled pursuit of money is imprudent: one does not issue handguns to the inmates of overly crowded prisons. We need to break the compulsory nature of money and make possible a future in which we are not at permanent war with nature and one another,” Buchan observes.
In all my wanderings across the great cities of the world and all my myopic scans across acres of newsprint and vellum, I’ve come to appreciate the need for forms of social organization that aren’t governed by the whims of fiat currency. The Occupy movement was and is, I believe, a rough draft of more humane social arrangements. We are not talking about just a protest movement, but also an eruption of a communal desire to honour human values that extend beyond the “frozen desire” of precious metals and their surrogates. This is hardly a pipe dream. Canada alone is home to thousands of cooperatives, including credit unions, which serve purposes other than the sole pursuit of profit.
Buchan himself believes money will eventually fail us, as it failed others so many times in the past, from the tulip bulbs of 17th century Holland to the German Marks of the Weimar Republic in the 1920s and beyond. The dreams of high finance will eventually dissolve, he insists, and “The Age of Money, which came after the Age of Faith, will itself draw, as all things under the sun, to an end.” What the author imagines will replace it, he does not say.