Money Matters - Book review

This is a great little book. Great, because it reveals the mystery of money to any intelligent person that wants to understand the supreme power in charge of our planet. Little, because it is an easy read. It has no graphs, no jargon, no formulae and no incomprehensibly long sentences.

It demystifies the dismal science of economics, handing its understanding back to the ordinary person. The sub-title reads "putting the eco into economics". This is the key realisation that ecology - the study of the inter-relatedness of an organism (that's us) with its surroundings - is the bedrock of real economics. This realisation is a revolutionary insight, that is set to transform economics in the 21st century in a way comparable to the Enlightenment of the 18th century.

David Boyle is an environmental journalist, which enables him to write in a simple, unchallenging way. His chapters are typically two or three pages long. He writes a series of stories, short anecdotes of the many perverse things that money has done and is doing to people and environment - and the beneficial things that a well-designed monetary system could do.

These stories carry the central message that money is a human invention that is usually designed to serve the needs of the rich and powerful, while in the process, it usually succeeds in making life more difficult for the poor and disempowered. The most important conclusion is that things do not have to be like this, and that there are forms of money that are more fit for the purpose of benefiting regular human beings as well as for the biosphere.

There are eight sections each devoted to one aspect of money:
· metal
· information
· Measurement
· debt
· Mad
· local
· DIY
· Spiritual

Boyle understands the central truth about the present form of money: it is created by the banks out of thin air in the act of creating an interest-bearing debt. This truth is denied and obscured by accountants, financiers and their dupes as vigorously as climate change is denied by Exxon Mobil and their dupes. But it is undeniable, because the amount of money in the world has been doubling every ten years, so somebody is creating it, and it ain't the Government because they only get to create the metal and paper money, about 3% of the total. All the rest is created by the banks through loans. End of argument. Period.

The resultant unstable, towering, inverted pyramid is founded on the belief that the debts will be paid. When this belief turns out to be ill-founded, the result is a crash, such as the one which the world is currently passing through.

The book is a sustained fountain of killer facts: for instance, two thirds of new money is created as mortgage loans, and mortgages eat up one third of our working life. Pensions have been ripped off. Crime pays. A corporate takeover of the whole world is under way.

Some of the facts offered in passing beggar belief; for instance, is it truly the case that the UK is still paying to Germany the ransom money for Richard the Lionheart incurred in 1193? (p 89) I think we should be told.

Boyle's case is a detailed exposition of the Cockney song, "It's the same the whole world over, It's the poor what get the blame, It's the rich what gets the pleasure, Ain't it all a bleeding shame?" He shows how money multiplies in the hands of those who hold it, and debt multiplies for those who do not hold it. A continuous theme is the amount of human work, real, creative, life-sustaining work such as parenting and caring, that is currently done for no money.

Most importantly, he offers solutions. He gives an array of instances where money has successfully been created by local people for local needs, often at times when the internal contradictions of official money has caused it to become unfit for purpose. We may be entering one of those periods in the next few months, and this book could prove to be a handy manual for getting a new money started at local level.

Nothing is perfect. Boyle sometimes is too brief, referring to events which could do with a bit more explanation. There is no index, though there is a rich bibliography, and a page of web references, which is a first as far as I know.

In conclusion, Money Matters is an easy-to-read introduction to finance and alternative finance to anyone who finds money a mysterious business. As such, it should find a readership approaching six billion on this planet alone.

Money Matters, ISBN 978-1-906136-20-8 David Boyle, Alastair Sawday Publishing, 2009. 220pp, £7.99