Since reading this the first time in 2009, I knew that I would be re-reading it, especially in conjunction with my putting together my anti-economics course, Economics Demystified. And so, the re-read is simply delightful, as I'm taking my time to think about her arguments and observations. (And I will be blogging, soon, I hope, a curious fushigi between something Atwood wrote and Noam Chomsky in Language and Politics.)
Very early in the book (p3-6), Atwood talks about the role of 'faith' in how money/debt functions. I am incorporating her text into my lecture notes, but it is interesting enough to post here. Given that it is a bit longer than what copyright rules allow, I've included links to the publisher for those who would like to purchase this excellent book.
ISBN 9780887848100
So, from Payback: Are banks like tooth fairies?
We kids of the 1940s did usually have some pocket money, and although we weren't supposed to talk about it or have an undue love of it, we were expected to learn to manage it at an early age. When I was eight years old, I had my first paying job. I was already acquainted with money in a more limited way — I got five cents a week as an allowance, which bought a lot more tooth decay then than it does now. The pennies not spent on candy I kept in a tin box that had once held Lipton tea. It had a brightly coloured Indian design, complete with elephant, opulent veiled lady, men in turbans, temples and domes, palm trees, and a sky so blue it never was. The pennies had leaves on one side and king's heads on the other, and were desirable to me according to their rarity and beauty: King George the Sixth, the reigning monarch, was common currency and thus low-ranking on my snobby little scale, and also he had no beard or moustache; but there were still some hairier George the Fifths in circulation, and, if you were lucky, a really fur-faced Edward the Seventh or two.
I understood that these pennies could be traded for goods such as ice cream cones, but I did not think them superior to the other units of currency used by my fellow children: cigarette-package airplane cards, milk-bottle tops, comic books, and glass marbles of many kinds. Within each of these categories, the principle was the same: rarity and beauty increased value. The rate of exchange was set by the children themselves, though a good deal of haggling took place.
All of that changed when I got a job. The job paid twenty-five cents an hour—a fortune! —and consisted of wheeling a baby around in the snow. As long as I brought the baby back, alive and not too frozen, I got the twenty-five cents. It was at this time in my life that each penny came to be worth the same as every other penny, despite whose head was on it, thus teaching me an important lesson: in high finance, aesthetic considerations soon drop by the wayside, worse luck.
Since I was making so much money, I was told I needed a bank account, so I graduated from the Lipton tea tin and acquired a red bank book. Now the difference between the pennies with heads on them and the marbles, milk-bottle tops, comic books, and airplane cards became clear, because you could not put the marbles into the bank. But you were urged to put your money in there, in order to keep it safe. When I'd accumulated a dangerous amount of the stuff—say, a dollar—I would deposit it at the bank, where the sum was recorded in pen and ink by an intimidating bank teller. The last number in the series was called "the balance"— not a term I understood, as I had yet to see a two-armed weighing scales.
Every once in a while an extra sum would appear in my red bank book—one I hadn't deposited. This, I was told, was called "interest," and I had "earned" it by having kept my money in the bank. I didn't understand this either. It was certainly interesting to me that I had some extra money — that must be why it was called "interest"— but I knew I hadn't actually earned it: no babies from the bank had-been wheeled around in the snow by me. Where then had these mysterious sums come from? Surely from the same imaginary place that spawned the nickels left by the Tooth Fairy in exchange for your shucked-off teeth: some realm of pious invention that couldn't be located anywhere exactly, but that we all had to pretend to believe in or the tooth-for-a-nickel gambit would no longer work.
However, the nickels under the pillow were real enough. So was the bank interest, because you could cash it in and turn it back into pennies, and thence into candy and ice cream cones. But how could a fiction generate real objects? I knew from fairy tales such as Peter Pan that if you ceased to believe in fairies they would drop dead: if I stopped believing in banks, would they too expire? The adult view was that fairies were unreal and banks were real. But was that true?
Thus began my financial puzzlements. Nor are they over yet (3-6).
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