Brett Scott: Money consciousness and the war on cash (ep371)

Written By kamea chayne
“If you’re looking at the broad trajectory of corporate capitalism, it’s towards institutional intermediation in everything... This ‘unbanked’ concept is always presented as if [‘financial inclusion’] obviously represents a step up in the world. But [really], you’re getting captured within an institutional framework or a type of conglomeration of institutions.”
— BRETT SCOTT

In this episode, we welcome Brett Scott, a journalist, campaigner, monetary anthropologist and former financial broker. He is the author of Cloudmoney: Cash, Cards, Crypto and the War for our Wallets (2022), and The Heretic's Guide to Global Finance (2013). He publishes the Altered States of Monetary Consciousness newsletter and tweets as @suitpossum.

Some of the topics we explore in this conversation include how the banking sector functions to extract and centralize financial wealth, the questionable presumptions behind "financial inclusion," how the cash system, ironically, serves as a constraint to the acceleration of corporate capitalism, and more.

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Transcript:

Note: Our episodes are minimally edited. Please view them as open invitations to dive deeper into each resource and topic explored. This transcript has been edited for clarity.

Brett Scott: This term, “fractional reserve banking” is controversial. It's more accurate nowadays to call it credit creation of money.

One of the main problems people have, across the political spectrum, when they're thinking about this concept of fractional reserve banking, is that they imagine that there's one type of money in society. This is one form of money fallacy, and is one of the biggest conceptual errors people make when they're trying to understand how the monetary system works.

They'll say things like, “I put my money in a bank. The bank takes that money and gives it to somebody else.” In that statement, you're imagining there's a single form of money going into one institution and then out again.

The key to actually understanding the banking sector and concepts like fractional reserve banking or credit creation of money, is you have to conceptualize that there's actually more than one form of money.

I have various metaphors by which to convey this idea.

[In a] Substack piece, I was writing about fractional reserve emotion—I said that I, in my daily life, am constantly issuing promises upon myself to people. I say, “Hey, I'll see you at some point,” or, “Hey, let's go grab a drink at some time,” or, “Let's do a collaboration.” Every time I'm doing that, I'm issuing out a promise, about a future action that I'm going to be taking.

I'll often be issuing out far more of these promises upon my energy than I actually have the ability to simultaneously deal with. So, if everybody that I've given a promise to simultaneously came back to me and said, “Hey, Brett, let's go do that thing right now,” I wouldn't have the reserves of energy to be able to simultaneously deal with that. Most people issue far more promises against themselves than they actually have the ability to [have people] redeem immediately. Many institutions [also] do this, and this is a fractional reserve system. Basically, you have a reserve of energy, a pool of available resources, and then promises that you push out against that.

I use also the example of a gym to convey this idea. Any gym that you go to issues out far more memberships than they have the ability to [handle]. If everybody who had a membership simultaneously visited the gym, they wouldn't be able to accommodate them all at the same time. So, they will only have space for let's say 200 people, but they'll issue out 5000 memberships, all because they assume that what's going to happen is that not everybody will visit at the same time.

Banks are doing a similar thing. They actually have a reserve of government-issued money and they actually issue out promises against that. So they issue out what are called IOUs, which are promises saying, “Hey, you can come and get that money at some point.” But they issue out far more of these promises than they actually have in state money.

This is what's called fractional reserve banking: they have a fraction of what they actually [have] promised out.

I have another metaphor—one I use in Cloudmoney, the book. Casinos are a very useful metaphor to convey the idea of two classes of money. If I walk into a casino with $100 of state-issued money or Federal Reserve-issued money, and I hand it over to the casino cashier, they will take ownership of that money and will issue me with chips in the casino. Now I have ownership of the chips, and they have ownership of the cash behind the counter.

In this situation, you suddenly see there are actually two forms of money present. There is state or government-issued money behind the counter. Then, there's a casino-issued IOU, essentially a type of promise saying if you come back to us, we will give you back money. In the meantime, I hold this promise in the form of a chip, which I can then transfer to other people in the casino. It's actually a privately-issued form of money that will circulate around the confines of a casino—the physical chips.

The banking sector does something similar. When you hand state-issued or government money to them, they take ownership of it and issue out chips to you, except they issue it out to you in digital form. Importantly, they—the banking sector—can issue out far more of these digital chips than they actually have in government money. The vast majority of the money that we actually use in society is in the form of these commercial bank-issued digital chips, which hypothetically can be redeemed back for cash. But most of them don't actually end up doing that. Most of them circulate around the banking sector.

And that's the whole digital payment system.

Kamea Chayne: Is it true, then, that it is literally impossible for everyone to take out the cash that they saved at their banks at the same time, and also that it is literally impossible for every person and entity currently with financial debt to be debt-free at the same time? Because if banks are lending out money as IOUs for money that they never had, but then asking for an interest in payment back, that itself creates more and more debt that wasn't in the system before, which means that our collective debt is only growing, and the bottom line would be that our collective debt exceeds our collective reserves?

Brett Scott: There’s a complex answer to this.

The first thing to bear in mind is that if everyone paid back the debt, there would be no money in society. So there's nothing inherently wrong with forms of credit, or promissory systems saying, “Hey, if you give me something now, I promise to return something to you later.” For example, if you think about the simple promise structure between friends. Let's say you have nothing right now, and a friend of yours has something. You say, “Hey, would you mind just giving me some of that? Then in a week's time, I'll return something to you.” That's a reciprocity structure. That's an informal credit relationship. This is happening with friendships all the time.

As a friend gives you something, for example, say you go to dinner, they're giving you something and you're accruing an unmeasured and informal type of debt, as it were, that there's a type of mental accounting that's going on where your friend will know that they've given you dinner. If you keep on going to dinner at their place and never offering to return it to them, at some point, the friendship's going to break down. A lot of relationships are based upon these informal credit relations between people where we all give and take. There's nothing inherently wrong with being indebted to people like that.

If you took that relationship, that informal credit relationship, and formalized it and abstracted it, you create a monetary system, which is [essentially] a much more formal, legal credit structure. This is how you can have much larger networks of people interacting with each other.

So there's nothing inherently wrong with people “not being able to pay back their debt” because actually societies in general are always constantly enmeshed in types of indebtedness in an interdependent economy. Everyone is “indebted” to everybody else in the sense that you can't really survive by yourself. If you're trying to imagine a world free of debt, it's almost like trying to imagine a world free of relations. When people say stuff like, “It's impossible for us to pay back the debt,” it's, well, true. If you actually tried to pay back the debt, you would have no monetary system or there would be no actual interdependent economy.

This is quite a complex point to convey.

Kamea Chayne: I think what I'm curious about is, let's say someone borrows a million dollars, so they write negative $1 million in their own accounting. Then, when the person returns that $1 million, that's reciprocity. There's a take and a give-back.

But at the same time, the bank always issues or requires an interest payment on that. Given that the existing cash system is as it is, is it possible for everyone to be paying back what they took in reciprocity plus giving back even more to Big Finance with the interest payments that they ask for?

Brett Scott: I guess the point I was making is a broad one. Quite a lot of people get a little bit hung up on the idea of debt being a bad thing. There's nothing really wrong with debt, in principle.

The toxic elements of debt tend to be around who's issuing it, on what terms, and whether they’re doing it in an extractive way.

In the banking sector, there's often a very extractive process [through] which debt is issued.

When a bank's issuing out new digital chips into society, they, in turn, will extract back loan agreements from people which are often worth more than the chips they're issuing out.

What banks often do is they create this—sorry if this sounds very obscure—pressure differential in society, where they're actually issuing out claims against themselves to us. So, the money you hold in bank accounts is actually a claim upon the bank. It's a liability. It's something they've promised out. But in return, how they've often created that is they've often extracted a loan agreement back from society which will create a reverse flow, at some point.

Banks create these structures where they're slowly extracting money from society over the long term. The key thing to bear in mind, though, with the politics of this, is that banks are not the only ones who are able to create money here. The first issuer of money in society is the state or out of the Federal Reserve. In the case of the U.S., for example, sometimes people get hung up on the idea that there's a limited amount of money and there's more interest. There's not enough money in circulation to pay the interest. There's something fundamentally parasitic going on. But really, if there's a debt crisis, for a start, debt can just be written off frequently. It's just canceled, or alternatively, the state can create new money. So, there's not a hard limit on the money supply.

I'm going around in circles in the question, but it is true that the banking sector has this parasitic element to it that is trying to extract from society, but it doesn't have a complete chokehold over the monetary system.

There are ways of breaking [the banking sector’s] power, as it were.

Kamea Chayne: Something else I would love to highlight is this lose-lose situation that the vast majority of people may find themselves in, given our current system, that whether the economy is in a boom or bust, most workers and the planet will find ourselves perhaps overextended and unfulfilled.

Could you connect the dots between the large-scale bank over-commitment and small-scale emotional burnout experienced by individuals, and talk about how a systemic optimism or a systemic withdrawal affects most people, ultimately leaving most still at a loss?

Brett Scott: This partly comes from the Substack article that I wrote called “An Emotional Guide to Fractional Reserve Banking”, where I was talking about this inverse relationship between exuberance in the banking sector at a meta scale and personal burnout at our scale.

When banks are issuing this new money and extracting loan agreements, you can almost think of them as heat-seeking missiles trying to find unexploited frontiers of production.

If there is a set of natural resources or ecology that hasn't been exploited and there's a bunch of human beings without a job, that's an inherent potential for the banking sector. They can say, “Okay, here we got a bunch of laborers who want to do something and a bunch of resources that can be exploited. But currently, the economic network hasn't reached out and commodified that frontier. So we can push out new money, which will then mobilize those workers via, for example, a corporate structure and get them to go and exploit those resources which will produce new things, which will then neutralize the increase in money pushed out.”

New money can always be created, provided that there are new resources to mobilize because the economic network will expand. This is what they're doing when they're doing stuff like fractional reserve, they're pushing out credit to mobilize production to, in theory, produce new things. This is an idealized version of what actually happens. When banks are very exuberant about the future, they're pushing out all this money. They're pushing out credit. They're saying, go and mobilize, go and build these buildings here. Go and do X, Y and Z, exploit this resource.

But this, often at a human scale in terms of people suffering, links to overwork and personal burnout. So you have this personal overwork.

When the banking sector is going into crisis, it will often retract. It'll still cool away from society. So during, for example, the financial crisis or any downturn, it does the opposite of the exuberant phase—it'll suddenly retract from society and pull stuff back. This is when you get these credit crunches and [it] retreats into itself, as it were. (Weirdly, this can give people a form of rest—but I'm reluctant about how far to push the argument.)

But when you think about politics of large-scale monetary politics with the Federal Reserve and all the banking sector, what's going on with the banking sector is all happy and exuberant. The Federal Reserve will just sit back and say, “Okay, let them do what they're doing.” But when suddenly the banking sector goes into shock and pulls back, suddenly the state will try to kick start the capitalist system again. This is where there are debates about whether there should be quantitative easing or should there be some stimulus program and so on. Basically what's happening is you get this huge interdependent network and the core players that hold the monetary system together have gone into shock, so you suddenly need the state jolted back into life again.

Kamea Chayne: This is how we know that these crises are systemic. Because when the economy is booming, it means that more and more parts of the planet are going to become financialized and commodified. It might lead to overworking and over-extraction.

As we saw with the COVID pandemic, when there is a recession, a lot of people get laid off. At the same time, some people talk about how there's less air pollution, so it's better for the environment. There might be a little less extraction in some ways, but a lot of families are struggling from not having jobs.

So in a lot of ways, this does appear to be a lose-lose situation, which means that the crisis is much deeper than viewing growing the economy as a way to improve people's quality of living.

Brett Scott: We're hostage to the system.

If you're trying to do the meta-scale analysis of large-scale economies, [you’ll realize] all human economies throughout history, regardless of what type you're talking about, revolve around interdependence. So in a very small-scale hunter-gatherer society, you're interdependent, you depend upon each other, right? But it's at a very small scale. You can see everybody is dependent upon what you're doing.

As economies scale up, you still have intense interdependence—often a lot more interdependence than you'll have in a small-scale setting—but you start to lose sight of it.

You start to entertain the illusion that you're independent, partially because you can't see the people you've become dependent on. So for example, to have this computer right now, I'm dependent upon people who are living many thousands of kilometers away, a place like Shenzhen, for example, and I have no idea who they are, but I'm dependent upon them. I can engage in the illusion that somehow I'm an independent being in this interdependent network because I can't see anything that I'm actually dependent upon.

When you're starting to analyze power in very large scale, interdependent networks, this becomes a very core thing to do during these crises, for example, in the pandemic—everyone goes into shock because sections of the system are falling down and it's affecting them.

The key question starts to become, where do the interventions get made? Who gets saved first? So, for example, [in] capitalist states, often the first thing they'll do is try to save the corporations, right? They won't try to save the ordinary person. They'll try to save the banking sector. They'll try to save the landlords because the landlords are connected to the banking sector. If the landlords go down, the banking sector is going down. So they help people pay their rent so the landlords don't go bust so the banking system doesn't go bust.

There are all these interdependent webs and it's very, very hard to see them. The core challenge of progressive politics is around how you deal with the fact that we are stuck in these vast interdependent capitalist systems, and we can't really get out of them, and intervene in them to create progressive outcomes.

Kamea Chayne: To go deeper into where we're headed, you note: "Five thousand years ago, monetary systems were small and isolated, but have come to engulf our civilization…money facilitates access to all the other things we are dependent upon, making it an ultimate object of dependence. This takes on a whole new dimension, however, when we lose the ability to directly hold our money."

We are at a time when, as you name it, there are conspirators working synergistically to eliminate cash: the banking sector, payment companies, the fintech industry, and states and central banks. This really feels so immense that it can feel conspiratorial. I'm not sure it's about anyone orchestrating this per se, but I think the bigger point is how the profit-driven system itself incentivizes the continued centralization of power and wealth.

But to explore the motives here, what is the relationship between the digitization of money and global corporate capitalism? Why would the corporate world see cash as a form of constraint to the acceleration of their growth and control, which leads people not necessarily to choose digital payments out of their free will, but maybe more so being pulled in that direction?

Brett Scott: This is what my new book is all about—the cash systems, the system of physical, government-money issued in physical form, versus this bank-issued digital money. This is what Cloudmoney is largely about, and the politics of all the different types of money.

One of the big arguments is that when you zoom out and look at the current configuration of the economic system, the broad trajectory in any large-scale capitalist system is toward concentration of what's a profit accumulation impulse. Especially when a system gets to a very, very large scale, it becomes very hard to control that impulse.

I’m probably taking a few steps ahead here, but in a very small-scale society, you tend to be able to exercise a degree of control of your economy. It's embedded in your world. You're able to see what everyone else is doing.

The larger the scale of your economy becomes, the more disembedded it becomes, the more disembodied it becomes, or the more disassociated it becomes.

Large parts of the financial sector often feel that they're very disassociated from the underlying, ground-level reality of the economy. When you look at global corporate capitalism, it has this inhuman feel to it, largely because it's detached from this community foundation. The only real thing that corporations are actually able to act upon in the final analysis is profit accumulation because they're detached from anything else. If you take this analysis seriously, you start to see that the global capitalist system operates in ways that—this can sound trippy—there's a certain inhuman impulse going on. It's doing things that aren't really in the interests of a small-scale person. It's doing things that are in the interest of large-scale corporates.

When you start to analyze, for example, the decline of the cash system, in the physical money systems we use, you can easily see that actually the cash system slows down, and profit accumulation slows down speed, scale, and complexity. If you're a very large player, with speed and scale and automation of things, you need to become even bigger. So the cash system exerts drag upon the overall consolidation impulse within corporate capitalism. This is why I'm arguing the cash system is currently being destroyed, not because ordinary people desire convenience and so on. It's being destroyed because it's slowing the system down.

That will manifest in your consciousness, perhaps via hegemonic cultural processes, as you might imagine yourself, as choosing to move to digital payments…

But in reality, [moving to digital payments has] nothing to do with what you want. It's got to do with what the system requires.

That's one of the big arguments in terms of this move away from cash. But it’s important to note that capitalist systems go through multiple phases. In an earlier phase, if we rewind a few hundred years, the cash system would have been one of the mechanisms via which capitalism extended itself. It would have been at the leading edge.

If you arrive in a pre-capitalist society where people don't even use money, in the old colonial times, you see that one of the ways you would incorporate people into the market economy was to force them to pay taxes in cash, actually in physical units of money.

There was a point in time when the cash system was the leading edge of the expansion of market economies. But in the current phase of global capitalism, the cash system has almost become anti-capitalist in the sense that it's slowing things down. It's become a site of resistance.

People who still insist on using cash in a way are rejecting the trajectory towards ever-increasing scale and automation from big players like Amazon and the banking sector.

This is what I'm writing about—the weird ambiguities of how the cash system is actually strangely standing in the way of the fusion between Big Finance and Big Tech at a global scale, which is one of the reasons why I think it should be protected.

Kamea Chayne: It's certainly interesting. The cash system was a tool of centralization, but it is [now] much slower than digital money.

Brett Scott: It actually enables—and this is all relative again, depending on what standpoint you look at it—in the current phase of capitalism, decentralization.

If you think about how the cash gets issued by central players, but you think what the way it actually moves through the society from hand to hand and local settings and physical settings, that's totally antithetical to the business model of large-scale digital corporates like Amazon, which require you to destroy time and space. Amazon cannot be its size unless you reject localism and slowness. It basically requires these huge scaled systems where you basically send messages across the globe.

In terms of the ideological structure of our society right now...

We're constantly told that what we all desire as human beings are evermore scale, speed, and convenience. But that's actually just a corporate profit-maximization impulse being channeled through the culture.

I sometimes analyze things in terms of the term “hegemony”. Gramsci came up with this concept, which is the situation when your culture starts to present the interests of a very powerful group as being the interests of all. When you walk through the streets right now and you speak to people and say, “Hey, do you like Apple Pay?” A lot of people say, “Yeah, that's cool, it's nice and convenient,” and so on. There's a very uncritical way of talking about this—that's a hegemonic structure. You basically have internalized the worldview of Big Tech and you believe that really it's for your own interests. Many, many people will experience this. I get a huge amount of flak when I'm trying to talk about why the cash systems are important because so many people have internalized the message that ever more scale, speed, and complexity are in their interests.

Kamea Chayne: There are certainly a lot of dominant framings and messaging to question.

I remember reading about how the Gates Foundation awarded an $11 million grant to MasterCard in 2014. This is MasterCard, with an annual net income of 8 billion in 2021, receiving an $11 million grant from the Gates Foundation. The purpose of that grant was to support one of their projects of “financial inclusion,” as MasterCard was working to financialize Nairobi, Kenya, and into West Africa and beyond, meaning to get these communities into their financial systems, moving them from their cash-based communities to bank money-based systems.

You talk about how “Practitioners in this field often use the term ‘unbanked’ (or ‘underbanked’) to refer to those who do not use formal financial institutions in their day-to-day lives… It’s a descriptor that carries a value judgment."

What is implicit in this framing of “financial inclusion” that we should maybe challenge and question? And we touched on this, but what does it mean for local communities through the lens of control and sovereignty as they become financialized by Big Finance?

Brett Scott:

If you're looking at the broad trajectory of corporate capitalism, it's towards institutional intermediation in everything.

If you don't abide by that, you will start to get presented as if you're out of sync with everything. Imagine you're a person in a rural area who rides a bicycle to a small outpost shop and you use cash to buy something. That's actually a very normal interaction. There's nothing wrong with that interaction. But through an institutional lens, through a particular ideology, you could present that in a particular way. You could say the person is using their own transport, they're not using a corporation's hyper-efficient, digitally intermediated form of transportation. So they are unbanked. The fact they're buying from a shop, you could say they haven't been absorbed into Amazon. The fact that they're using cash is because they're unbanked—they're not using a bank.

So, this “unbanked” concept is always presented as if somehow it obviously represented a step up in the world. But [really], you're getting captured within an institutional framework or type of conglomeration of institutions.

The reason why some institutions or some people believe that this is in your best interest is that if you indeed are captured as a hostage within corporate capitalism and you lack access to its core institutions, you might indeed start to find yourself being rejected and excluded from the economy. If indeed everyone else is being absorbed and you're not, you're going to find yourself, in relative terms, being disadvantaged, right? Which will subsequently lead to this mentality that you can be saved by joining everybody else.

This is what they call financial inclusion. Often it's like, “Oh, well, lots of other people have been absorbed into dependence upon Visa and MasterCard. Now you must also be absorbed. Otherwise, you will be rejected.” Because really that trajectory of the global economy is not controlled by you. It's controlled by these big players. If they are rejecting you right now, you're disadvantaged. It leads to this Stockholm Syndrome type of mentality. What’s happening is you’re entering a state of capture where you're being absorbed. Because if you don't enter that state of capture, you will be, in a sense, marginalized.

We can present the state of capture as if it was a positive thing, and somehow the act of incorporating you is doing some great revolution, or is some great wonderful act of humanitarian aid that at least the mainstream part [of the financial inclusion folks] often do. Visa and MasterCard and all the big players, like Bill and Melinda Gates and so on, they all carry this mentality that is obviously desirable to bring you in.

This becomes very controversial because if you're looking at the history of capitalist systems, sometimes the worse position to be in is to be partially integrated into a capitalist system. People who are totally detached can often be better off than a person who is partially attached to it. So if you're half-dependent on these institutions and you sometimes get access and you sometimes don't—this is often where some justice systems of poverty lie.

One of the crudest ways to show this is to look at uncontacted Indigenous groups in the Amazon. In many ways, uncontacted groups are fine. They have a world. They have structural integrity in their world. It hasn't been broken by the intrusion of a capitalist system. But if you were half stuck in Indigenous society and half in a market economy, you're like mist. You're really screwed over. This is often what's happening even, for example, the places like the Amazon where you'll have these incursions going on.

The deep politics of this is [whether] it is really in your interest to get absorbed by the system and on what terms are you going to get absorbed. Will you be on the lowest subordinated rungs of the market economy when you're getting "included" in it?

Kamea Chayne: That really speaks to how there are different forms of “poverty” as well. Because if someone is monetarily poor while living in a financialized city, that's going to be extremely difficult. But somebody else could be living in a land-based subsistence economy and be monetarily poor, but not be hungry and [actually be] very food secure and have access to community, to relationships, to land that can provide real health-enriching food, and so forth.

Brett Scott: That's a very good way of conveying that partial integration concept because the partial integration is really where you get screwed.

Kamea Chayne: Right. It's really worth questioning when NGOs and so forth will determine a community's quality of life based on their average wage or their daily income because that doesn't account for the full picture of the maybe different forms of economies that they already have.

In my conversation with Dr. Vandana Shiva, I recall she gave this example that was really helpful, of how in a cash-based economy, when someone goes to the market and pays $20 for a bag of produce, the farmer receives that $20 in its entirety. But when one uses a credit card to pay for the same thing, a certain percentage from every transaction gets extracted and into the hands of Big Finance.

We can imagine, from every monetary transaction in the world between people becoming financialized, what that would mean for the extraction of wealth from the bottom up and from decentralized places to centralized corporations. That, to me, made it very clear why there are incentives for Big Finance to try to make more and more people dependent on them.

I know you're well aware of the contradictions of technology, though. As you share: "Technology is double-sided. We experience it as empowering, and yet it increases our dependency. The external gadgets that support us come to mold our actions and thoughts as innovations that are initially received as new options but go on to become mandatory necessities."

This leads me to believe that the broad judgment of anti-tech or anti-innovation really needs to be teased out more because resistance against these changes taking place is often framed, as a broad stroke, as anti-tech, anti-advancement.

But for me, there's always an important distinction to be made—innovation for what purpose, to benefit who, and at what cost? And who gets to decide what advancement even looks like, and to what ends it's oriented? Maybe it's not so much the idea of innovation or our capacities for creativity, but the underlying incentives guiding those imaginations and realizations. I wonder what else this might stir up for you at this moment.

Brett Scott: Doing tech critique is notoriously difficult, because you're often going against a dominant hegemonic ideology that more tech is always better. Bear in mind: The reason why that ideology is in place is that there's a particular type of technology promoted by capitalist institutions, which is all about profit accumulation.

Most mainstream futurism where people are imagining a future is basically just taking the corporate profit interests of companies and putting a futuristic spin on them.

Often when you look at tech-futurism, there's a very specific type of technology that will be seen as valid, and the others won't be seen as valid. What we don't see is as important as what we do see. That's a complex thing to say, but there are many types of technology that won't get built precisely because they don't operate along the rungs of corporate profit accumulation. Often, we'll never get to see what those technologies are because they don't get built.

The dominant cultural ideology we live under is this idea that somehow [there is] this inevitability to a certain trajectory of technological development, which is often that's the type of technology that's appropriate to large-scale capitalist networkers, either automation to cut costs for corporates, or it's about being able to sell some new products, or it's about military power, which is often what underpins these systems. Those are the types of technologies that we're used to.

Within the ideology of technology, for example, if you go to Silicon Valley, there will be this idea that there are no trade-offs involved. Technology only expands your world, it doesn't take something away, it only brings something new. In reality, what actually happens in human society is not only are there trade-offs in technology, when you get something, it takes something away. But also, they often get neutralized. You will only temporarily experience the joy of new technology for six months, maybe, if you're lucky, before it becomes neutralized and becomes a baseline standard in your world [through] which you will then perceive everything else.

One of the examples I use to convey this is cars in cities like Los Angeles. So, within the capitalist system, technology is never used to save you time. It's used to expand production and increase speed. For example, if you were living in a tribal society and a car was introduced. Let's say you previously had to walk one kilometer to get somewhere, suddenly you gained a bunch of leisure time because the car enables you to get there much faster. But in reality, in a capitalist economy that would never happen. What would actually happen is that you would use the car to expand production, so you would basically extend your community much further.

You'll build big cities because suddenly you have the ability to live very far away from your place of work. Places like Los Angeles, for example, are these gigantic urban sprawls because you have car technology introduced in a particular context which will then sprawl everybody out. You'll end up living really far from everything because the car enables it and the car will expand production. Now, if you find yourself born into a situation on the outskirts of Los Angeles and you don't have a car, you will start to perceive yourself as being disadvantaged if you don't have it.

Let's say you're a teenager and you want to get to your girlfriend across the other side of town and it looks so far away. It's ten kilometers. It's so inconvenient to walk that far. All right, I need a car. The car empowers me. The car industry acts on my behalf. But really, what's happened there is the car industry has a chokehold over your economy. You cannot operate unless you use its products. It's this Stockholm Syndrome thing. You believe that your captor somehow has your best interest at heart. You desperately want a car because it will enable you to operate in this society.

But if some time traveler that came to you from the past, say from a much earlier society, they would just say to you, “why are you living so far away from your girlfriend? Why are you in this situation to begin with? Why don't you just live next door to her? Then you could walk.” Walking would not be inconvenient if it was 200 meters. It's only inconvenient because it's 30 kilometers away. The reason it's 30 kilometers away is that you have cars.

This is the really complex thing to convey to people about technology often that people with digital money say to me, “Oh, well, but it's so convenient.” Then I'll say, “And yet you're busier than ever before.” The reason why you perceive this as convenient is that if you don't adopt it, you start to get shafted within this accelerating economic network and you're basically stuck in the situation. It's really hard to convey to people the contradictions and ambiguities of technology.

Kamea Chayne: It seems like we're increasingly locked into the system so that they become inevitable. It's really important to take a step back to contextualize and to think about how we even got to where we are in the first place, where so many of these things have become unavoidable parts of our daily lives.

We don't have too much time to give this the proper exploration it deserves, but I still wanted to bring this up with you. Cryptocurrency has often been propped up as a radical, decentralized alternative to disrupt centralized monetary systems. But how is it that something that started out as this imagined antithesis to Big Finance and Big Tech became something that is increasingly embraced by financial institutions and mega-corporations? And how might it instead, far from being revolutionary, as you say, even further dystopian trends rather than combat them?

Brett Scott: To contextualize that: There are a couple of things going on… There's the cryptocurrency world, which is people trading Bitcoin and stuff like that. But then there's the cooptation of the underlying technology which has been happening in the corporate sector. Bear in mind that the original Bitcoin system in broad strokes was a system for coordinating action between strangers, and people who don't know each other on a large scale.

We're stuck in these super large-scale economies where we don't know each other. This was a system historically, you needed large institutions that mediate between people, because that's the only way human beings could operate at scale. The crypto world had an ideological excitement because it was basically saying, “Okay, we figured out a way to take super large-scale networks of people who don't know each other and allow them to coordinate action between themselves without going through these overt central institutions.”

But in terms of the corporate sector, the corporate sector already basically is the dominant set of players within our global economic system. Corporations have to coordinate actions between themselves all the time across large-scale mining. A corporation has vast supply chains and so on. Banks have these huge interconnected systems between themselves. So big oligopoly players have to coordinate action between themselves as well, and they often struggle to do that.

A lot of the cooptation of blockchain technology has been them saying, “Hey, here's a coordination technology that ordinary people could use, but we could also use it.” We can figure out new ways to coordinate action between ourselves because we already have to do that. What's called private blockchains or consortium blockchains stuff is basically just business as usual, reframed in a new way. So that's the corporate use of blockchain technology.

It has provided a lot of fascinating new opportunities for people in the sense of there are some actual things that it's doing, but also it is promoting extremely conservative thinking and monetary systems, sometimes downright right-wing thinking of monetary systems. Actually, that's [even] being absorbed by previously progressive thinking groups. I've seen lots of hippies, for example, getting really sucked into a right-wing monetary theory via their exposure to crypto token trading, so this is a worrying ideological tendency.

Kamea Chayne: We could spend hours talking on cryptocurrency alone.

What's really interesting for me is that we know diversity lends itself to resilience, and yet we're experiencing the illusion of increased diversity in many ways, while in actuality experiencing a decrease in diversity in all aspects of life and biodiversity, cultural diversity, the diversity of actual currencies of life and decentralized financial systems.

As you've shared, "Major oligopolies (conglomerations of mega-firms) are forming out of this process [of the merging of Big Finance and Big Tech], but they are concealed behind a proliferation of apps that give the superficial appearance of diversity."

Even on a smaller scale, I find this to be true for our experiences at the supermarkets as well. The continued centralization and homogenization of our food systems are masked behind a proliferation of food brands that give the illusion of diversity.

So how might we actually decentralize? How might we actually decentralize and diversify the representational and real currencies of life and not become locked further into something that may appear to be empowering, but in the long term really disempower us? And are there even possibilities to dream beyond cash-dependent systems that you've thought about, given that they're representational, and the reductive monetary currency itself is incapable of fully and properly capturing the true value of care, fulfillment, relationships, and our planetary riches?

Brett Scott: I've been involved in alternative economy movements for quite a long time, and I've worked many alternative currencies, alternative banking, alternative everything in economies.

There are often two competing intuitions that go on in economic reform, should we say, or people interested in this so-called new economy. On one hand, there's a recognition that we live in a vortex of corporate capitalism, and it is a vortex. It sucks people in. Everyone is sucked into the digital payments and card systems—literally like gravity pulling you into a vortex system.

If you look at all these anarchist communes or people setting up permaculture gardens and whatever, many different these things where there's a recognition of the economic system pulling away from human society and you pull back. Despite the fact that the market economy doesn't incentivize me to build a community garden, I'm going to do it anyway. I'm going to try and set out to slack this type of system, against the vortex.

But it's very hard to sustain these because they go against the grain of the profit accumulation impulse that governs our system. The history of alternative economy movements is littered with all these dead projects because they can't—it's too exhausting to hold them in play. Sometimes I visualize it [this way]: you're in this hurricane and there are all these little groups trying to bed down tents against the hurricane. They just get sucked up and destroyed and you're left with these empty tent sites.

Now, the other impulse that you'll find is people who say, let's work with the dynamics of the system. Let's go with the vortex. People like you working in green finance or working in profitable forms of entrepreneurism where they believe they can change stuff. Social entrepreneurism has a bit of this element to it. Let's work with the dynamics of the system and then try to Trojan Horse in changes. Often those things can be totally ineffective, because they don't really actually change anything.

I think the most interesting stuff a person going forward in terms of thinking about how do you change systems is to try and navigate some space between that to say, “Okay, the reality is if you're trying to survive in a market economy, you have to figure out ways to sustain yourself and make money.” If you're not working along the grain, you're going to get screwed. But if you work too much with the grain, you're not going to do anything. So a large part of the Web3 community right now, a lot of the crypto-progressive parts of the blockchain community have some of this intuition. They're like, “Maybe if we work with a profit accumulation impulse to these speculative token markets, we can pull into being some new economy somehow.” There's a lot of hypocrisy and doublethink that goes along with that, but it's an interesting impulse.

What's interesting is thinking about the intersection between what's considered realistic in a market economy and what's considered idealistic.

There's an interesting space to navigate, walking a tightrope, as it were, which might actually authentically create some positive changes in an economy. But if you go too far in either direction, you basically end up nowhere. That's an interesting challenge for anybody trying to run a new project to say, “Yeah, can we work with the grain yet simultaneously change the dynamics of the system?” I don't have the specific answers for how you do that, but maybe that'll be my next book.

[Musical offering: The Witness by Rowan Rain]

Kamea Chayne: Thank you. Onto our concluding questions. What has been an impactful book that you've read or a publication that you follow?

Brett Scott: Doughnut Economics, by Kate Raworth.

Kamea Chayne: What is a personal motto, mantra, or practice you engage with to stay grounded?

Brett Scott: I play a lot of guitar and sing.

Kamea Chayne: What are your biggest sources of inspiration at the moment?

Brett Scott: People who really inspire me right now are those who embrace contradiction. I found myself not very inspired by people who are too noncontradictory in their thinking to be these very subtle black or white views. [It’s] very enlivening to meet people who recognize that the world is characterized by contradiction as a basic ground-level foundation. That makes me excited.

Kamea Chayne: I share that excitement as well, and I really enjoy these conversations that involve a lot of messiness and contradiction. So, thank you so much for joining me on the show today. You've given us so much more to ponder and think about.

For now, Brett, what final words of wisdom do you want to leave us with as green dreamers?

Brett Scott: Keep on dreaming and embrace the contradictory ambiguities of our glorious and troubled world.

 
kamea chayne

Kamea Chayne is a creative, writer, and the host of Green Dreamer Podcast.

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