The Power Play To Eliminate The Petrodollar

Saturday, March 22, 2014
By Paul Martin

Callum Newman
Saturday, 22 March 2014

Anthropology isn’t the profession that springs to mind when wondering how to turn a buck in the financial markets. But the marauding armies of antiquity may tell you more about the shifting Saudi-US alliance than you can read about in The Wall Street Journal. The petrodollar standard couldn’t exist, after all, without the example of Rome.

Throughout history, cash markets – money itself – arose through war. This is linked to the premise that it is credit, not money, which is the main constant in human affairs. We wish we could lay claim to this idea, but it’s not ours. It belongs to David Graeber, an anthropologist, who wrote the intriguing book Debt: The First 5000 Years:

“Say a king wishes to support a standing army of 50,000 men. Under ancient or medieval conditions, feeding such a force was an enormous problem… On the other hand, if one simply hands out coins to soldiers and then demands that every family in the kingdom was obliged to pay one of those coins back to you [to pay taxes], one would, in one blow, turn one’s entire national economy into a vast machine for the provisioning of soldiers, since now every family, in order to get their hands on the coins, must find some way to contribute to the general effort to provide soldiers with the things they want.”

One of the themes of Debt is that the history of the world can be broken into yin and yang periods of dominance between credit style economies and bullion/cash ones. Money springs up, Graeber argues, in periods of generalised violence.

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