Why Money Isn’t An Accurate Measurement of Value
Currency is a means of exchanging. Pre-currency times didn’t have the dollar, pound, or ruble, instead they had to barter. Wanted a chair? Bake a cake for someone in exchange for said chair. This was a tedious process, so currency was created in order to make this process more efficient. Even though, money has made the exchange of commodities easier, it is inherently faulty and exploitative, let me explain.
Most people know what a supply-demand graph is. Entrepreneurs use supply and demand graphs to set prices for products. They set the prices somewhere around the equilibrium—the blue dot in the center. The reason they do this is to match the subjective needs of a consumer with the current supply of a commodity (D and S). This graph subscribes to the Subjective Theory of Value, which states that the value of a commodity should be determined by the needs of the consumers of said product. This system however is flawed. In order to have an S-D graph, the economy must be a market economy. A market economy restricts choice and requires theft. Think of the two top soda corporations: PepsiCo and Coca-Cola, they control pretty much all of the soda you drink. Like Sprite? Coca-Cola owns it. What about Mountain Dew? Pepsi owns it. A market economy falls to its knees due to the inevitable growth of monopolies. This in turn, restricts demand.
Market economies also rely on exploitation to create their products. If the owner of a company owned ten factories and each factory contained a hundred workers, each working 15 hours a day to make chairs, then the owner is extracting the surplus from the workers. Allow me to explain: at the end of the day, workers create products not the owner. Let’s say that the materials to create a chair costs $50. A worker assembles a chair every thirty minutes or so. Mr. Boss takes the finished chair and sells it for $65, generating a profit of $15. Some might be wondering, “What has the boss done to actually earn this profit?” The answer: stealing labor from the worker, which is immoral and workless.
Let me tie this theory of exploitation (wage-labor) back to my point as to why currency is obsolete. If we were to try to measure the value of commodities accurately, it makes sense now that we must measure them in labor-values, not subjective consumer needs (money). Profit represents the surplus and exploitation Mr. Boss generates and commits. It does NOT represent “hard work”. Modern currency does not work because it represents a surplus generated through exploitation and its whole theory of subjectivity is inherently flawed.
